TCR_Public/030729.mbx         T R O U B L E D   C O M P A N Y   R E P O R T E R

             Tuesday, July 29, 2003, Vol. 7, No. 148

                          Headlines

8X8 INC: Red Ink Continued to Flow in Fiscal First Quarter 2004
ADELPHIA COMMS: Elects Bigelow & Wolfe as Independent Directors
ADELPHIA COMMS: Brings-In BDO Seidman as Forensic Accountants
AIR CANADA: Canadian Court Dismisses Global Payments' Appeal
AK STEEL: Secures New $400 Million Revolving Credit Facility

ALLEGIANCE TELECOM: Postpones Annual Shareholders' Meeting
AMERCO: First Meeting of Creditors to Convene on August 11, 2003
AMERICAN CELLULAR: Prices Private $900MM 10% Sr. Debt Offering
AMSTED IND.: S&P Assigns BB- Corp. Credit & Bank Loan Ratings
ANC RENTAL: Wants to Obtain $12MM Postpetition Bonding Facility

ASIA GLOBAL CROSSING: Chapter 7 Trustee Hires Golenbock Eiseman
BEA CBO 1998-1: S&P Junks Ratings on Class A-2A & A-2B Notes
BOFA ALTERNATIVE LOAN: Fitch Rates 4 Note Classes at Low-B Level
BOISE CASCADE: Elects Robert Strenge to Vice President Position
BURLINGTON: WL Ross Pitches Bid to Acquire Assets for $620 Mil.

CABLE SATISFACTION: Files CCAA Plan of Arrangement in Canada
CONSTELLATION BRANDS: Prices Common & Preferred Stock Offerings
CUMMINS INC: Reports Solid 2003 Second Quarter Financial Results
DELTA AIR LINES: Commences Exchange Offer for M-T and Sr. Notes
DELTA AIR: Gen. Counsel Robert Harkey Plans to Retire by Dec. 31

DYNAMOTIVE ENERGY: Moving Forward with Restructuring Activities
DYNEGY INC: Second Quarter 2003 Net Loss Hits $290 Million
EAGLE FOOD CENTERS: Will Padlock Four Underperforming Stores
ENRON CORP: Liquidation Analysis Will Show Chapter 11 Plan is Best
FEDERAL-MOGUL: Wants Lease Decision Deadline Moved to December 1

FLEMING COMPANIES: Earns Nod to Pay $15 Million C&S Break-Up Fee
GE HOME: Fitch Ratchets Junks Class B-3 Rating Down to C
GENCORP INC: Preparing to Offer $175MM Senior Subordinated Notes
GENCORP INC: S&P Rates Proposed $175MM Senior Sub. Notes at B+
GENCORP: Fitch Assigns BB- Rating to Proposed $175M Senior Notes

GERDAU AMERISTEEL: Q2 Conference Call Scheduled for Friday
GLOBAL CROSSING: Court OKs Greenberg Traurig as Special Counsel
GRUPO IUSACELL: Second Quarter Net Loss Narrows to $124 Million
HAIGHTS CROSS: S&P Drops Corporate Credit Rating a Notch to B
HAWK CORP: Hosting Second Quarter 2003 Conference Call Today

HEADWAY CORPORATE: Disclosure Statement Hearing Set for Aug. 7
HERCULES INC: Shareholders' Committee Terminates Proxy Contest
INFOUSA INC: S&P Places Lower-B Ratings on CreditWatch Positive
INTERNATIONAL PAPER: Declares Regular Quarterly Dividend
INVESCO CBO: Fitch Affirms BB- Rating on Class B-2 Notes

IT GROUP: Removal Period Extension Hearing to Convene on Monday
KMART: Sues Philip Morris for $8 Million Compensatory Damages
LA QUINTA: Will Publish Second Quarter 2003 Results on Thursday
LEAR CORP: Names Daniel A. Ninivaggi as VP and General Counsel
LORAL SPACE: Taps Weil Gotshal for Chapter 11 Legal Services

LTV: Court Okays McDermott Will as Copperweld's Labor Counsel
LYONDELL CHEM: S&P Lowers Ratings over Weak 2nd Quarter Results
LYRTECH INC: Inks Debt Restructuring Pact via Debt Conversion
MEOW MIX: S&P Places BB- Credit & Debt Ratings on Watch Negative
MIRANT: Court Approves Notice Protocol for Securities Trading

MIRANT: Wants Blessing to Continue Intercompany Asset Transfers
MORGAN STANLEY: S&P Assigns Low-B Rating to Class D Notes
MOTIENT CORP: Morgens Waterfall Discloses 5.8% Equity Stake
MSX INT'L: Caps Price of Private Senior Secured Debt Offering
MUTUAL RISK: Completes Scheme of Arrangement with Creditors

NATIONAL CENTURY: Signs-Up Long & Foster as Real Estate Brokers
NOBEL LEARNING: Brings-In George H. Bernstein as New Company CEO
OMEGA HEALTHCARE: Second Quarter Results Enter Positive Zone
OMI TRUST: S&P Drops Subordinate B-1 Class Note Rating to D
PG&E NATIONAL: Wants Nod to Hire Ordinary Course Professionals

PILLOWTEX CORP: Banks Extend Forbearance Agreement to Thursday
POSSIBLE DREAMS: Security Capital Sells 25% in Parent Company
QUAIL PIPING: Seeks Authority to Hire Gadsby Hannah as Counsel
QUANTUM CORP: Sells $160 Million of 4.375% Conv. Sub. Notes
REINK CORP: Court Converts Bankruptcy Case to Chapter 7

REUNION IND.: Hires Wiss & Co. to Replace Ernst & Young as Auditor
RIDGEWOOD HOTELS: Moore Stephens Expresses Going Concern Doubt
ROSSBOROUGH-REMACOR: Turning to Parkland for Financial Advice
SAFETY-KLEEN: Court Okays Settlement with Heritage Environmental
SEITEL INC: Looks to FTI Consulting for Restructuring Advice

SINGING MACHINE: Grant Thornton Airs Going Concern Uncertainty
SK GLOBAL AMERICA: Bringing-In Togut Segal as Bankruptcy Counsel
SPIEGEL: Gets Go-Signal to Implement Key Employee Retention Plan
STILLWATER MINING: Reports $19 Million Net Loss for 2nd Quarter
TELEMARK INC: Canadian Receiver Solicits Bids for Retail Assets

TEXAS PETROCHEMICAL: Wants Nod to Use Lenders' Cash Collateral
TRANSDIGM: Completes Merger Transaction with Warburg Pincus Unit
TRITON PCS: Appoints Glen Mella as Senior VP Marketing & Sales
TRUDY CORP: Net Capital Deficit Raises Going Concern Uncertainty
UNIFORET: Canadian Court Nixes Leave to Appeal May 16 Decision

UPC POLSKA: Secures Blessing to Sign-Up FTI for Financial Advice
US AIRWAYS: Resolves Claim Dispute with Allegheny County Airport
US AIRWAYS: Asks Court to Establish Distribution Reserve
US DATAWORKS: Board of Directors Adopts Shareholder Rights Plan
VAIL RESORTS: Decentralizes Marketing and Sales Organization

VANTAGEMED: Will Webcast Q2 Conference Call on August 8, 2003
WASHINGTON MUTUAL: Fitch Rates Class B-4 & B-5 Certs. at BB/B
WEIRTON STEEL: Files Schedules & Statement in W. Virginia Court
WELLNESS PLAN: Gets R Fin'l Strength Rating over Rehabilitation
WESTPOINT STEVENS: Committee Hires Stroock & Stroock as Counsel

WORLD AIRWAYS: Reaches Tentative Pact with Flight Attendants
WORLDCOM: CAGW Applauds Rep. Sweeney for Addressing MCI Bailout
WORLDCOM INC: Hires Cushman & Wakefield as Real Estate Broker
ZI CORPORATION: Names Michael Donnell New President & CEO

* Large Companies with Insolvent Balance Sheets

                          *********

8X8 INC: Red Ink Continued to Flow in Fiscal First Quarter 2004
---------------------------------------------------------------
8x8, Inc. (Nasdaq: EGHT) announced financial results for its first
fiscal quarter ended June 30, 2003.

Total revenues for the first quarter of fiscal 2004 were $1.6
million, compared with $3.3 million for the same period of the
prior year. The net loss for the quarter was $1.5 million,
compared with a net loss of $2.1 million for the same period last
year.

At Jun 30, 2003, 8x8, Inc.'s balance sheet shows that the
Company's net capital continues to dwindle to about $847,000 from
about $2 million recorded 3 months ago.

For detailed financial results and other disclosures, see 8x8's
Report on Form 10-Q for the quarter ended June 30, 2003 as filed
with the Securities and Exchange Commission on July 25, 2003.

Additionally, the company announced that it has promoted Dr. Barry
Andrews to President, and Marc Petit-Huguenin to Chief Technology
Officer and Vice President, Engineering. Dr. Andrews most recently
served as Chief Technology Officer and Vice President,
Engineering, and Mr. Petit-Huguenin formerly served as Packet8's
Chief Software Architect. Huw Rees, in addition to his role as CEO
of Centile, Inc., will assume the role of Vice President, Sales
and Marketing of 8x8, Inc.

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

                          *     *     *

                 Liquidity and Capital Resources

In its Form 10-Q for the period ended March 31, 2003, the
Company reported:

The possibility that the Company will not be able to meet its
obligations as and when they become due over the next twelve
months raises substantial doubt about the Company's ability to
continue as a going concern. Accordingly, the Company has been
pursuing, and will continue to pursue, among other things, the
implementation of certain cost reduction strategies and the
licensing or sale of its technologies or projects. Additionally,
the Company plans to seek additional financing and evaluate
financing alternatives during the next twelve months in order to
meet its cash requirements for the remainder of fiscal 2004. The
Company has sustained net losses and negative cash flows from
operations since fiscal 1999 that have been funded primarily
through the issuance of equity securities and borrowings.
Management expects to experience negative cash flows for the
foreseeable future and such losses may be substantial. There is no
assurance that the Company will be able to obtain financing on
terms favorable to the Company, or at all. If the Company issues
additional equity or convertible debt securities to raise funds,
the ownership percentage of the Company's existing stockholders
would be reduced and they may experience significant dilution.
Failure to increase revenues, to manage net operating expenses and
to raise additional financing through public or private equity
financing or other sources of financing may result in the Company
not achieving its longer term business objectives. The
consolidated financial statements do not include any adjustments
that might result from the outcome of this uncertainty.

In connection with efforts to improve its liquidity, in June 2003
Netergy entered into an agreement whereby it would sell certain
assets and license/sell certain technology related to its next-
generation video compression semiconductor product for cash. The
closing of this transaction is subject to certain conditions
beyond the Company's control and there can be no assurance that
the transaction will close. Even if the transaction closes,
additional cash resources may be necessary for the Company to
sustain its operations. The Company does not expect to incur a
loss on this transaction.

In July 2003, the Company announced that Netergy had licensed its
voice over IP Audacity-T2 and T2U semiconductor products and
Veracity software. The customer obtained rights to sell T2 and T2U
based semiconductor products bundled with the Veracity software,
and, in return, will pay Netergy a license fee and royalties for
each T2 and T2U semiconductor it sells.


ADELPHIA COMMS: Elects Bigelow & Wolfe as Independent Directors
---------------------------------------------------------------
As part of its previously announced commitment to reconstitute its
Board of Directors with broad expertise in cable television,
finance and corporate governance, Adelphia Communications
Corporation's (OTC: ADELQ) Board of Directors has elected two new
independent members: E. Thayer Bigelow, Jr. and Kenneth L. Wolfe.
They will replace outgoing board members Leslie Gelber and Pete
Metros, two of the four remaining directors who served before the
company's Chapter 11 filing.

William T. Schleyer, chairman and chief executive officer of
Adelphia, made the announcement. Pursuant to an order of the
bankruptcy court overseeing Adelphia's Chapter 11 case, Adelphia
is required to provide certain constituencies with five business
days' advance written notice of such elections. As a result, the
appointments will become effective on August 2, 2003.

"Thayer Bigelow and Ken Wolfe each bring strong business and
financial backgrounds to our board and we look forward to
benefiting from their expertise and counsel," said Schleyer.
"Their appointments continue Adelphia's commitment to build an
independent board of directors possessing great depth of knowledge
in corporate finance, corporate governance and relevant industry
experience."

Adelphia previously announced in June that four carry-over board
members had indicated their intention to resign from the board as
new members were appointed. Once the appointments of Messrs.
Bigelow and Wolfe become effective, Messrs. Gelber and Metros will
resign from the board. The company has retained the search firm
Spencer Stuart, which identified Bigelow and Wolfe, to help it
identify additional candidates for the board.

Bigelow is managing general partner of Bigelow Media, an
investment company with emphasis on the media and entertainment
industries. Before that he was interim president and CEO of
Courtroom Television Network LLC, president and CEO of Time Warner
Cable Programming, president of Home Box Office, Inc. and
president of American Television and Communications Corp. He also
served four years as chief financial officer of Time, Inc.

Wolfe is the recently retired former chairman of Hershey Foods
Corporation. During his tenure at Hershey Foods, he served as its
Chairman and CEO, President and COO, CFO and Senior VP of Finance
and as its Treasurer, among other titles.

Schleyer also expressed thanks to outgoing carry-over board
members Gelber and Metros. "Les and Pete played important roles
positioning Adelphia for a successful reorganization. They took
decisive action to remove the Rigases and conduct investigations
while working to preserve as much value as possible and maintain
customer service. We are grateful for their hard work and
dedication and appreciate their support of Adelphia's transition
to a new team. We wish them well."

E. Thayer Bigelow, Jr., 61, is a highly experienced senior
executive in the cable TV industry with a background in general
management, marketing, finance, operations and programming that
spans nearly the entire history of cable TV, from the early 1970's
to today. Since 1998 he has been managing general partner of
Bigelow Media, LLC, a media investment and consulting firm. From
1997 to 1998 he was interim CEO of Court Room Television Network,
with overall operational responsibility for maintaining the
network's viability while its ownership was restructured.

Bigelow spent six years as president and CEO of Time Warner Cable
Programming, which led the development of several 24-hour local
news channels, music choice channels, interactive television
ventures and a multi-channel pay-per-view service that later
became In Demand. For three years as president and COO of HBO he
was responsible for marketing, finance, affiliate sales,
operations, international and business development, including
launch of the Comedy Channel.

Bigelow was president of American Television and Communications
and for four years chief financial officer for Time, Inc. He has
also held positions with Manhattan Cable Television, Time Life
Films, Time Life Video and the Time, Inc. corporate finance
department.

Bigelow serves on two corporate boards: Crane Company and Huttig
Building Products, Inc. and serves as an independent director of
the Lord Abbett Family of Mutual Funds. He is a trustee or advisor
to several charitable organizations, including Trinity College and
The Boys' Club of New York. He received his Bachelor of Arts
degree in 1965 from Trinity College and a Masters of Business
Administration in 1967 from the Darden Graduate School of Business
at the University of Virginia. He served two years in the U.S.
Marines.

Kenneth L. Wolfe, 64, is a distinguished and seasoned corporate
leader with 35 years experience in key leadership positions at
Hershey Foods Corporation. Most recently he served as Chairman
until his retirement in January 2002. He was chairman and CEO of
Hershey Foods from 1993 to 2001 and president and COO from 1985 to
1993.

Wolfe served as Hershey's chief financial officer and senior vice
president of finance, its vice president of finance and
commodities, its vice president of finance and administration, its
treasurer, its director of operations and financial analysis and
its budget director.

Wolfe serves on two other corporate boards: Bausch & Lomb, Inc.,
where he sits on the corporate governance committee, and Carpenter
Technology Corporation. He is a former director of the Hershey
Trust Company and a member of the Board of Managers of the Milton
S. Hershey School and the M.S. Hershey Foundation.

Wolfe received his Bachelor of Arts degree from Yale University in
1961 and his Masters of Business Administration from the Wharton
School at the University of Pennsylvania in 1967. While at Yale,
he played football on the school's last undefeated team. He also
served four years in the U.S. Navy.

The Yale University School of Management and the Chief Executive
Leadership Summit recently presented Wolfe with its "Legends in
Leadership" award, citing him as a "role model for current and
future leaders" and noting his commitment to "areas that are now
so crucial: integrity, reliable numbers and forecasts, enviable
product quality and genuine community responsibility."

Adelphia Communications Corporation is the fifth-largest cable
television company in the country. It serves 3,500 communities in
32 states and Puerto Rico, and offers analog and digital cable
services, high-speed Internet access (Adelphia Power Link), and
other advanced services.


ADELPHIA COMMS: Brings-In BDO Seidman as Forensic Accountants
-------------------------------------------------------------
Shelly C. Chapman, Esq., at Willkie Farr & Gallagher, in New
York, notes that the Adelphia Communications Debtors are in the
process of reviewing and analyzing various claims, issues and
disputes that relate to their relationship with the ABIZ Debtors.
In addition, the ACOM Debtors are analyzing what, if any,
potential claims ABIZ may assert against their estates.  These
determinations are highly complex and require the assistance of
professionals with specialized knowledge of forensic accounting,
Ms. Chapman says.

PricewaterhouseCoopers LLP has been retained in these cases to
perform certain forensic accounting services and conduct an
external audit.  However, Ms. Chapman reports that PwC is
precluded from providing the forensic accounting services needed
as it will affect its independence in conducting the ACOM
Debtors' audit.

Accordingly, the ACOM Debtors seek the Court's authority to
employ BDO Seidman, LLP to perform the necessary forensic and
investigative accounting services, pursuant to Sections 327(a),
328, 330 and 331 of the Bankruptcy Code, Rule 2014 of the Federal
Rules of Bankruptcy Procedure and Local Bankruptcy Rule 2014-1.

Carl W. Pergola, a partner at BDO Seidman, LLP, informs Judge
Gerber that BDO is a firm of independent public accountants as
defined under the Code of Professional Conduct of the American
Institute of Certified Public Accountants.  With BDO's diverse
experience and extensive knowledge in the fields of forensic
accounting, litigation support and other general bankruptcy
related accounting services, the Debtors believe that BDO is well
qualified to serve as special forensic accountant in these
Chapter 11 cases.

Pursuant to an Engagement Letter, BDO will:

    (i) provide a detailed review and analysis of the Debtors'
        cash management system, including documenting the cash
        management system functions and controls and evaluating
        the nature of the cash management system from its
        inception through to day of the ABIZ/ACOM separation and
        beyond;

   (ii) provide extensive analysis of all intercompany accounts
        between ABIZ and ACOM;

  (iii) review documentation relating to the debt allocation
        methodologies between ABIZ and ACOM;

   (iv) assess the flow of funds between and among the various
        ACOM/ABIZ joint ventures;

    (v) provide analysis relative to payments made in connection
        with management agreements between ACOM and ABIZ;

   (vi) serve as either a fact witness or expert witness in
        these proceedings;

  (vii) render assistance in connection with reports and
        financial statements the Court require;

(viii) conduct interviews;

   (ix) gather and review documentary and digital evidence;

    (x) assist with digital evidence recovery and preservation of
        electronic documents, which may include recovery and
        analysis of digital data from workstations, network
        environments, and other digital devises in accordance with
        Court-accepted guidelines for the search, seizure, and
        processing of digital evidence; and

   (xi) perform other forensic accounting tasks as the Debtors
        may require.

Ms. Chapman tells the Court that the Debtors intend to share with
the Committees the result of the analysis BDO performed.  Even
though the Creditors' Committee already retained a forensic
accountant to investigate certain claims and transactions that
the Debtors' estates may possess, the Debtors require BDO's
assistance to conduct a thorough analysis of the Debtors'
relationship with ABIZ as it is incumbent on the Debtors to take
the lead in investigating ABIZ claims and related issues.

BDO will seek Court approval of the compensation for the services
rendered and the reimbursement of out-of-pocket expenses incurred
in performing the services.  BDO's hourly rates are:

    Partners/Directors         $375 - 475
    Managers                    250 - 350
    Associates                   80 - 250

Mr. Pergola states that the current hourly rates are subject to
periodic adjustments based on economic and other conditions.
According to Mr. Pergola, BDO has not received any compensation
from the Debtors or any other party-in-interest in connection
with these Chapter 11 cases.

Ms. Chapman says that to the extent BDO provides advisory
services to Willkie Farr & Gallagher or any of the Debtors' other
retained counsel in these cases in connection with litigation
matters, BDO's work will be performed at the sole direction of
the Debtors' counsel and will be solely and exclusively for the
purpose of assisting the Debtors' counsel in their representation
of the Debtors.  Hence, BDO's work may be fundamentally important
in the formation of mental impressions and legal theories by the
Debtors' counsel, which may be used in advising the Debtors and
in the representation of the Debtors.  For BDO to carry out its
responsibilities, it may be necessary for the Debtors' counsel to
disclose its legal analysis as well as other privileged
information and attorney work product.  Thus, it is critical that
the Court order that the status of any writings, analysis,
communications and metal impressions formed, made, produced or
created by BDO in connection with its assistance of the Debtors'
counsel or any of the Debtors' other retained professionals in
litigation be deemed to be the work product of the Debtors'
counsel in their capacity as attorneys for the Debtors.
Moreover, the Debtors ask the Court to provide that the
confidentiality or the privileged status of the BDO Work Product
will not be affected by the fact that BDO has been retained by
the Debtors rather than by their counsel.

Mr. Pergola assures Judge Gerber that BDO, with respect to any
matters relating to these cases, has not represented and has no
relationship with:

    -- the Debtors and their counsel;

    -- the creditors, equity holders and their counsel;

    -- any other parties-in-interest in these cases; and

    -- the U.S. Trustee or any person employed in the Office of
       the U.S. Trustee.

Moreover, the BDO principals and professionals:

    (a) do not have any connection with the Debtors, their
        creditors, or any party-in-interest, or their attorneys;

    (b) do not hold or represent an interest adverse to the
        estate; and

    (c) are "disinterested persons" within the meaning of Section
        101(14) of the Bankruptcy Code. (Adelphia Bankruptcy News,
        Issue No. 36; Bankruptcy Creditors' Service, Inc.,
        609/392-0900)


AIR CANADA: Canadian Court Dismisses Global Payments' Appeal
------------------------------------------------------------
Air Canada provides this update on the airline's restructuring
under the Companies' Creditors Arrangement Act:

The Court of Appeal for Ontario issued a decision unanimously
dismissing an appeal by Global Payments Canada Inc., relating to
arrangements for processing of credit card payments.

Global Payments was seeking an order requiring Air Canada to post
security for credit card processing services. Mr. Justice James
Farley's order of May 7,2003, rejecting that request was upheld by
the Court of Appeal.


AK STEEL: Secures New $400 Million Revolving Credit Facility
------------------------------------------------------------
AK Steel (NYSE: AKS) has entered into a $400 million, five-year
senior secured revolving credit facility with a syndicate of
lenders. The new facility is secured by the company's inventory
and borrowings would be used for general corporate purposes. The
company also has a $300 million revolving credit facility secured
by accounts receivable. Credit Suisse First Boston LLC acted as
lead arranger and book running manager and is serving as
administrative agent for the new facility.

AK Steel, headquartered in Middletown, produces flat-rolled
carbon, stainless and electrical steel products for automotive,
appliance, construction and manufacturing markets, as well as
tubular steel products.  AK Steel has steel producing and
finishing facilities in Middletown, Coshocton, Mansfield,
Walbridge, and Zanesville, Ohio; Ashland, Kentucky; Rockport,
Indiana; and Butler, Pennsylvania. AK Steel also produces snow and
ice control products, and operates a major industrial park on the
Houston, Texas ship channel.

As reported in Troubled Company Reporter's July 24, 2003 edition,
Standard & Poor's Ratings Services 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.


ALLEGIANCE TELECOM: Postpones Annual Shareholders' Meeting
----------------------------------------------------------
Allegiance Telecom, Inc. (OTC Bulletin Board: ALGXQ), a
facilities-based national local exchange carrier (NLEC), announced
postponement of the Company's annual stockholders' meeting,
originally scheduled for today. A new date for the stockholders'
meeting will be determined and announced in the future.

Allegiance Telecom is currently pursuing financial restructuring
plans under Chapter 11 of the U.S. Bankruptcy Code, as previously
announced on May 14, 2003. The Company continues to conduct
business as usual -- offering high-quality, reliable
telecommunications services to its customers in major markets
across the United States.

The bankruptcy filings were made in the U.S. Bankruptcy Court in
the Southern District of New York. The Company's bankruptcy case
number is 03- 13057(RDD) and its Bankruptcy Court filings are
available via the court's website, at www.nysb.uscourts.gov .
Please note that a PACER password is required to access documents
on the Bankruptcy Court's website.

Additional information regarding the Company's reorganization is
available at http://www.algx.com/restructuring

Allegiance Telecom is a facilities-based national integrated
communications provider headquartered in Dallas, Texas. As the
leader in competitive local service for medium and small
businesses, Allegiance offers "One source for business
telecom(TM)" -- a complete package of telecommunications services,
including local, long distance, international calling, high-speed
data transmission and Internet services and a full suite of
customer premise communications equipment and service offerings.
Allegiance serves major metropolitan areas in the U.S. with its
single source provider approach.


AMERCO: First Meeting of Creditors to Convene on August 11, 2003
----------------------------------------------------------------
The United States Trustee has called for a meeting of AMERCO's
Creditors pursuant to 11 U.S.C. Sec. 341(a) to be held on August
11, 2003 at 10:00 a.m.  The Meeting will be held at C. Clifton
Young Federal Building, 300 Booth Street, Room 2110 in Reno,
Nevada.

All creditors are invited, but not required, to attend.  This
Official Meeting of Creditors offers the one opportunity in a
bankruptcy proceeding for creditors to question a responsible
office of the Debtor under oath. (AMERCO Bankruptcy News, Issue
No. 3; Bankruptcy Creditors' Service, Inc., 609/392-0900)


AMERICAN CELLULAR: Prices Private $900MM 10% Sr. Debt Offering
--------------------------------------------------------------
American Cellular and ACC Escrow Corp., jointly announced the
pricing of a private offering of $900 million aggregate principal
amount of 10% senior notes due 2011. The senior notes will be
issued at a price of 100 percent of par.

The notes will be issued by ACC Escrow Corp., a recently formed
corporation that was organized to merge into American Cellular
Corporation as part of a previously announced plan to restructure
American Cellular's capital and indebtedness. Upon consummation of
the restructuring, including the merger, the net proceeds from the
offering will be used to fully repay American Cellular's existing
bank credit facility and to pay all or a portion of the expenses
of the restructuring, with any remaining net proceeds to be used
for general corporate purposes. Closing of the transaction, which
is scheduled for August 8, 2003, is subject to the satisfaction of
customary closing conditions.

American Cellular is jointly owned by Dobson Communications
(Nasdaq:DCEL) and AT&T Wireless (NYSE:AWE). ACC Escrow Corp. is a
recently formed, wholly owned, indirect subsidiary of Dobson
Communications Corporation.

The notes are being sold only to qualified institutional buyers
under Rule 144A and to persons outside the United States under
Regulation S. The notes have not been registered under the
Securities Act of 1933 or under any state securities laws, and,
unless so registered, may not be offered or sold in the United
States except pursuant to an exemption from, or in a transaction
not subject to, the registration requirements of the Securities
Act and applicable state securities laws.

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

As reported in Troubled Company Reporter's July 17, 2003 edition,
Standard & Poor's Ratings Services lowered the corporate credit
rating on American Cellular Corp. to 'SD' from 'CC' and the
subordinated debt rating on the company to 'D' from 'C'. The
ratings have been removed from CreditWatch, where they were placed
April 5, 2002.

The rating actions followed the company's announcement of its
proposed restructuring, which would involve a tender offer of less
than full value for the company's approximately $700 million of
9.5% senior subordinated notes due 2009. The deal also proposes a
prepackaged bankruptcy plan if the tender offer is not successful.

The 'CC' bank loan rating on the company had been affirmed and was
also removed from CreditWatch. The outlook on the bank loan rating
is negative. The debt exchanged is viewed by Standard & Poor's as
tantamount to a default on the original debt issue terms.


AMSTED IND.: S&P Assigns BB- Corp. Credit & Bank Loan Ratings
-------------------------------------------------------------
Standard & Poor's Ratings Services assigned its 'BB-' corporate
credit rating and stable outlook to Amsted Industries Inc. At the
same time, Standard & Poor's assigned its 'BB-' bank loan rating
to the company's $525 million bank facility and 'B' senior
unsecured debt rating to the company's $275 million senior
unsecured notes due 2011. Proceeds from the notes issue will be
used to repay existing bank debt and for working capital and
general corporate purposes.

Privately held Chicago, Illinois-based Amsted Industries
manufactures highly engineered industrial components for the
railroad (33% of revenues), vehicular (31%) and construction (37%)
industries. Total rated debt will be $800 million.

The senior secured bank facilities consist of a $125 million
revolving credit facility due 2008 and a $400 million term loan B
due 2010 and are secured by a first-priority perfected security
interest in all assets owned by Amsted, the capital stock and
assets of its domestic subsidiaries, and 65% of the capital 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.

Amsted Industries, with total sales of about $1.5 billion, is the
market leader in the undercarriage of freight cars in North
America and also has leading niche positions in certain vehicular,
construction, and industrial markets. About 80% of its sales base
comes from the U.S., while Canada and the rest of the world
account for about 14% and 6%, respectively.

Apart from expected demand improvements in the rail and vehicular
markets, Amsted is seeking to enhance revenues through selective
price increases and increased content per unit sold. The
construction industry remains subject to an improvement in general
economic conditions, and sales in this area are expected to remain
fairly flat in the interim, constrained in part by pricing
pressures. However, the segment's steady volume is expected to
partially balance the cyclical nature of the company's other
markets.

"Amsted's cash flow generation will improve as the company's key
end-markets bottom and gradually recover and should allow the
company to reduce debt levels over time," said Standard & Poor's
credit analyst Linli Chee. "Enhanced levels of liquidity over time
could provide some flexibility for limited, moderate-size, bolt-on
acquisitions. However, expected annual repurchase obligations
under the employee stock ownership plans, relative to expected
cash flows, currently limit upside ratings potential."

Given Amsted's success in managing costs amid difficult end-market
conditions, the company should be able to maintain profitability
and cash flow protection measures that are in line with the
rating.


ANC RENTAL: Wants to Obtain $12MM Postpetition Bonding Facility
---------------------------------------------------------------
Bonnie Glantz Fatell, Esq., at Blank Rome LLP, in Wilmington,
Delaware, informs the Court that ANC Rental Corporation, and its
debtor-affiliates are required to support various aspects of their
business with surety bonds, which allow them to operate their
business.  Currently, the bulk of the Debtors' bonding needs is
met by Liberty Mutual Insurance Company.  Additionally, Travelers
Casualty and Surety Company of America issued $9,400,000 in surety
bonds pursuant to certain existing indemnity agreements.

In recognition of the Debtors' critical need for Travelers'
support and future bonding, as well as Travelers' concerns and
requirements with respect to the bonding, representatives of both
parties negotiated the terms and conditions applicable to the
issuance by Travelers of certain surety bonds to the Debtors
postpetition.

The Debtors and Travelers have agreed to a term sheet, pursuant
to which Travelers has agreed, subject to its normal underwriting
requirements, to provide certain postpetition bonding to the
Debtors up to $12,000,000.

The Debtors have provided Travelers with, and seek to continue to
provide it with, adequate and sufficient protections to secure
all of the Debtors' obligations to it in respect of any surety
bonds that have been or may be issued by Travelers for any Debtor
or pursuant to any indemnity agreements between any Debtor and
Travelers.

Travelers currently holds $12,000,000 in cash collateral, which
supports existing bonds in the face amount of $9,400,000,
exclusive of certain expenses and other obligations of the
Debtors to Travelers.  Travelers has agreed to issue $2,600,000
in additional bonds and to utilize, as security for those bonds,
existing unencumbered collateral they currently hold in lieu of
requiring additional collateral for these bonds.

In the Debtors' business judgment, the Travelers' Bonds will
create a benefit to the estate, and will ultimately be beneficial
to its creditors.  Under and pursuant to the Term Sheet, the
Debtors will be able to secure essential bonding that will permit
them to continue necessary business operations, and the terms and
conditions proffered by Travelers to the Debtors are unavailable
from any other source.  In return for its agreement to provide
postpetition surety bonds to the Debtors, Travelers will be given
certain protections in recognition of the financial risks it has
taken, continues to take and will undertake on the Debtors'
behalf.

Pursuant to the terms of the Term Sheet, the Debtors will provide
Travelers with a new indemnity agreement, which is in addition
to, and not in lieu of, existing indemnity agreements.  In
addition, the Debtors will ratify all existing Travelers indemnity
agreements.

To induce Travelers to provide additional postpetition credit in
the form of surety bonds and to renew, continue or issue new
surety bonds on the Debtors' behalf, the Debtors seek the Court's
authority, with respect to all new or renewed bonds, to grant to
Travelers the protections set forth in the Term Sheet and
Indemnity Agreement.  These protections include granting Travelers
a security interest pursuant to Section 364 of the Bankruptcy
Code, and allowing Travelers to retain the cash collateral it
currently holds with respect to the existing Travelers' Bonds,
reimbursing Travelers for its fees and expenses incurred in
connection with the negotiation, preparation, and documentation of
the postpetition bonding facility requested by the Debtors, and
granting to Travelers certain other protections.

In addition, the Debtors ask Judge Walrath to permit Travelers to
utilize any collateral the Debtors have previously provided to
Travelers to secure Obligations incurred by the Debtors as a
result of the issuance by Travelers of any surety bonds
postpetition in an amount of up to the amount of any of the
collateral currently held by Travelers in lieu of demanding
additional collateral for the Obligations.  The Debtors also ask
the Court to allow Travelers to cross-apply any of the collateral
to any bonded Obligation or to any loss, cost, expense or unpaid
premium incurred in connection with any Travelers bonds issued on
the Debtors' behalf or the Indemnity Agreement or the existing
indemnity agreements, or the enforcement of the Indemnity
Agreement or existing indemnity agreements.  Furthermore, the
Debtors seek the Court's authority to provide as security
additional cash or letters of credit to Travelers, in the amount
of 100% of the Obligations associated with any additional bonds
issued by Travelers on the Debtors' behalf.

Pursuant to Sections 105, 363, and 364 of the Bankruptcy Code,
the Debtors seek the Court's authority to:

    1. enter into and perform the Term Sheet in order to obtain a
       postpetition bonding facility from Travelers for the
       issuance of surety bonds, which are absolutely essential to
       the Debtors' ability to operate their businesses and to
       reorganize successfully;

    2. enter into and perform the Indemnity Agreement and to
       ratify all existing indemnity agreements; and

    3. afford to Travelers all the protections set forth in the
       Term Sheet and Indemnity Agreement with regard to any new,
       renewed, or existing bonds.

As noted, pursuant to the terms of the Term Sheet and the
Indemnity Agreement, the Debtors will obtain a postpetition
bonding facility from Travelers for the issuance of surety bonds,
which are essential to the Debtors' ability to operate their
businesses and to reorganize successfully.  The Debtors have been
unable to obtain from any other source unsecured postpetition
surety bonds nor to obtain postpetition surety bonds on terms and
conditions as favorable as those agreed to by Travelers in the
Term Sheet. (ANC Rental Bankruptcy News, Issue No. 36; Bankruptcy
Creditors' Service, Inc., 609/392-0900)


ASIA GLOBAL CROSSING: Chapter 7 Trustee Hires Golenbock Eiseman
---------------------------------------------------------------
Pursuant to Section 327(a) of the Bankruptcy Code and Rule 2014
of the Federal Rules of Bankruptcy Procedure, Asia Global Crossing
Ltd.'s Chapter 7 Trustee, Robert L. Geltzer sought and obtained
the Court's authority to employ Golenbock, Eiseman, Assor, Bell &
Peskoe as general counsel, nunc pro tunc to June 20, 2003.

Mr. Geltzer informs Judge Bernstein that he selected Golenbock
because of its experience in matters of this nature.

As Mr. Geltzer's general counsel, Golenbock will render legal
advice and services, including, without limitation:

    (a) provide legal advice in connection with the Trustee's
        investigation of the Debtors' affairs;

    (b) file appropriate pleadings to obtain a bar date for
        claims incurred in the predecessor Chapter 11 cases;

    (c) investigate and prosecute the complaint filed by Asia
        Global Crossing Ltd., against the Bank of New York, to
        recover a preferential transfer and all matters related
        to it; and

    (d) provide legal advice and prosecute objections to claims,
        including to investigate and litigate the disputes among
        the Debtors and the "Pacific Crossing Companies,"
        including PC Landing Corp., Pacific Crossing, Ltd.,
        Pacific Crossing UK, Ltd., PCL Japan, Ltd. and SCS
        Bermuda, Ltd., including objecting to claims asserted by
        those entities against the Debtors' estates.

Mr. Geltzer assures the Court that Golenbock's work will not
duplicate the work of other special litigation counsel to be
retained in these cases.

Jonathan L. Flaxer, Esq., a member of Golenbock, Eiseman, Assor,
Bell & Peskoe, reports that the firm will seek compensation in
accordance with its hourly rates:

    Paralegals           $100 - 125
    Associates            200 - 270
    Partners              350 - 425

Golenbock will also seek reimbursement of reasonable expenses
incurred in connection with performing the services, including
copying charges, word processing charges, travel charges and long
distance telephone charges.

Mr. Flaxer relates that to the best of his knowledge, neither the
firm nor its employees, have:

    -- any relationship to these Chapter 7 cases;

    -- any business association with these Chapter 7 cases; or

    -- any relevant relationship to any attorney, creditor or any
       other party in these Chapter 7 cases.

Thus, Mr. Flaxer concludes, Golenbock is a "disinterested person"
within the meaning of Sections 101(14) and 327(a) of the
Bankruptcy Code. (Global Crossing Bankruptcy News, Issue No. 44;
Bankruptcy Creditors' Service, Inc., 609/392-0900)


BEA CBO 1998-1: S&P Junks Ratings on Class A-2A & A-2B Notes
------------------------------------------------------------
Standard & Poor's Ratings Services lowered its ratings on the
class A-2A and A-2B notes issued by BEA CBO 1998-1 Ltd. and co-
issued by BEA CBO 1998-1 (Delaware) Corp., and removed them from
CreditWatch with negative implications, where they were placed
May 30, 2003.

The lowered ratings reflect factors that have negatively affected
the credit enhancement available to support the notes since the
ratings were previously lowered Sept. 26, 2002. These factors
include continuing par erosion of the collateral pool securing the
rated notes and a decline in the credit quality of the performing
assets in the collateral pool.

According to the July 2, 2003 trustee report, the transaction is
carrying an aggregate of $59.64 million in defaults, or
approximately 21.72% of the collateral. As a result of asset
defaults, the overcollateralization ratios for the transaction
have deteriorated. According to the July report, the class A
overcollateralization ratio was at 80.94%, versus the required
ratio of 126%, and compared to its ratio of 95.08% at the time of
the September 2002 rating action. The ratio has been out of
compliance since November 2000. The transaction is also currently
failing three out of four categories in Standard & Poor's issuer
rating distribution test.

The transaction paid down all of the class A-1 notes on the
December 2002 payment date.

Standard & Poor's has reviewed the results of the current cash
flow runs generated for BEA CBO 1998-1 Ltd. to determine the level
of future defaults the rated tranches can withstand under various
stressed default timing and interest rate scenarios, while still
paying all of the rated interest and principal due on the notes.
After the results of these cash flow runs were compared with the
projected default performance of the performing assets in the
collateral pool, it was determined that the ratings currently
assigned to the class A-2A and A-2B notes were no longer
consistent with the amount of credit enhancement available,
resulting in the lowered ratings.

Standard & Poor's will remain in close contact with Prudential
Investment Management Inc., the collateral manager, and will
continue to monitor the performance of the transaction to ensure
the ratings assigned to all the notes remain consistent with the
credit enhancement available.

    RATINGS LOWERED AND REMOVED FROM CREDITWATCH NEGATIVE

     BEA CBO 1998-1 Ltd./BEA CBO 1998-1 (Delaware) Corp.

                    Rating                Current
        Class   To          From          Balance (mil. $)
        A-2A    CCC-        B/Watch Neg            152.31
        A-2B    CCC-        B/Watch Neg             26.63

                OTHER OUTSTANDING RATING

     BEA CBO 1998-1 Ltd./BEA CBO 1998-1 (Delaware) Corp.

                         Current
        Class   Rating   Balance (mil. $)
        A-3     CC                 26.00


BOFA ALTERNATIVE LOAN: Fitch Rates 4 Note Classes at Low-B Level
----------------------------------------------------------------
Banc of America Alternative Loan Trust 2003-6 mortgage pass-
through certificates are rated by Fitch Ratings as follows:

   Group 1 certificates (Group 1CB and Group 1NC):

     -- $379,028,000 classes 1-CB-1, 1-NC-1, 1-NC-2, 1-NC-3,
           1-NC-4, 1-NC-5, 1-CB-WIO, and 1-NC-WIO 'AAA';
     -- $100 class CB-R 'AAA';
     -- $8,610,000 class 1-B-1 'AA';
     -- $4,005,000 class 1-B-2 'A';
     -- $2,001,000 class 1-B-3 'BBB';
     -- $2,003,000 class 1-B-4 'BB';
     -- $1,401,000 class 1-B-5 'B'.

   Group 2 certificates:

     -- $100,612,000 classes 2-A-1 and 2-A-WIO 'AAA';
     -- $1,137,000 class 2-B-1 'AA';
     -- $362,000 class 2-B-2 'A';
     -- $362,000 class 2-B-3 'BBB';
     -- $206,000 class 2-B-4 'BB';
     -- $104,000 class 2-B-5 'B'.

   and certificates of both groups:

     -- $2,211,773 class A-PO 'AAA'.

The 'AAA' rating on the group 1 senior certificates reflects the
4.90% subordination provided by the 2.15% class 1-B-1, 1% class 1-
B-2, 0.50% class 1-B-3, 0.50% privately offered class 1-B-4, 0.35%
privately offered class 1-B-5, and 0.40% privately offered Class
1-B-6. Classes 1-B-1, 1-B-2, 1-B-3, and the privately offered
classes 1-B-4 and 1-B-5 are rated 'AA', 'A', 'BBB', 'BB', and 'B',
respectively, based on their respective subordination.

The 'AAA' rating on the group 2 senior certificates reflects the
2.25% subordination provided by the 1.10% class 2-B-1, 0.35% class
2-B-2, 0.35% class 2-B-3, 0.20% privately offered class 2-B-4,
0.10% privately offered class 2-B-5, and 0.15% privately offered
Class 2-B-6. Classes 2-B-1, 2-B-2, 2-B-3, and the privately
offered classes 2-B-4, and 2-B-5 are rated 'AA', 'A', 'BBB', 'BB'
and 'B', respectively, based on their respective subordination.

The ratings also reflect the quality of the underlying collateral,
the capabilities of Bank of America Mortgage, Inc. as servicer
(rated 'RPS1' by Fitch), and Fitch's confidence in the integrity
of the legal and financial structure of the transaction.

The transaction is secured by three pools of mortgage loans. The
loan groups 1CB and 1NC within group 1 are cross-collateralized.
Group 2 is not cross-collateralized with group 1. The class A-PO
consists of three separate components which are not severable.

Approximately 34.73%, 83.49%, and 40.85% of the mortgage loans in
group 1CB, INC and group 2, respectively, were underwritten using
Bank of America's 'Alternative A' guidelines. These guidelines are
less stringent than Bank of America's general underwriting
guidelines and could include limited documentation or higher
maximum loan-to-value ratios. Mortgage loans underwritten to
'Alternative A' guidelines could experience higher rates of
default and losses than loans underwritten using Bank of America's
general underwriting guidelines.

The Group 1CB collateral consists of recently originated,
conventional, fixed-rate, fully amortizing, first lien, one- to
four-family residential mortgage loans with original terms to
stated maturity ranging from 240 to 360 months. The weighted
average original loan-to-value ratio for the mortgage loans in the
pool is approximately 69.85%. The average balance of the mortgage
loans is $139,457 and the weighted average coupon of the loans is
6.037%. The weighted average FICO credit score for the group is
735. The states that represent the largest portion of mortgage
loans are California (43.85%), Florida (11.89%), and Virginia
(4.04%).

The Group 1NC collateral consists of recently originated,
conventional, fixed-rate, fully amortizing, first lien, one- to
four-family residential mortgage loans with original terms to
stated maturity from 240 to 360 months. The weighted average OLTV
for the mortgage loans in the pool is approximately 66.73%. The
average balance of the mortgage loans is $464,239 and the weighted
average coupon of the loans is 6.072%. The weighted average FICO
credit score for the group is 734. The states that represent the
largest portion of mortgage loans are California (71.83%), Florida
(6.61%), and Illinois (3%).

The Group 2 collateral consists of recently originated,
conventional, fixed-rate, fully amortizing, first lien, one- to
four-family residential mortgage loans with original terms to
stated maturity ranging from 120 to 180 months. The weighted
average OLTV for the mortgage loans in the pool is approximately
61.35%. The average balance of the mortgage loans is $106,555 and
the weighted average coupon of the loans is 5.457%. The weighted
average FICO credit score for the group is 736. The states that
represent the largest portion of mortgage loans are California
(35.05%), Florida (14.13%), Texas (6.34%) and Virginia (6.20%).

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

Banc of America Mortgage Securities, Inc. deposited the loans in
the trust, which issued the certificates, representing undivided
beneficial ownership in the trust. For federal income tax
purposes, elections will be made to treat the trust as a real
estate mortgage investment conduit. Wells Fargo Bank Minnesota,
National Association will act as trustee.


BOISE CASCADE: Elects Robert Strenge to Vice President Position
---------------------------------------------------------------
Boise Cascade Corporation (NYSE: BCC) announced that Robert E.
Strenge has been elected vice president and region manager,
Louisiana Operations, Boise Paper Solutions.

Strenge joined Boise in 1988 as production manager at the
company's Vancouver, Washington, pulp and paper mill.  From 1990
to 1994, he was production manager at Boise's pulp and paper mills
in West Tacoma, Washington, and, subsequently, DeRidder,
Louisiana.  From 1994 to 1997, Strenge held the positions of
engineering services manager and production manager at the paper
mill in DeRidder and senior staff engineer, Paper Engineering, at
the company's headquarters in Boise, Idaho.  In 1997, Strenge was
named manager of Boise's pulp and paper mill in St. Helens,
Oregon.  He was named region manager, Louisiana Operations, in
2002.

Strenge received a bachelor's degree in pulp and paper technology
from Syracuse University in 1976 and is a 2002 graduate of the
Stanford Executive Program.

Boise delivers office, building, and paper solutions that help our
customers to manage productive offices and construct well-built
homes - two of the most important activities in our society.
Boise's 24,000 employees help people work more efficiently, build
more effectively, and create new ways to meet business challenges.
Boise also provides constructive solutions for environmental
conservation by managing natural resources for the benefit of
future generations.  Boise had sales of $7.4 billion in 2002.
Visit the Boise Web site at http://www.bc.com

                        *   *   *

As previously reported, Standard & Poor's assigned its 'BB+'
preliminary rating to Boise Cascade Corp.'s (BB+/Stable/--) $500
million shelf. Rating outlook is stable.

Standard & Poor's assigned its double-'B'-plus rating to Boise
Cascade Corp.'s $150 million 7.5% senior unsecured notes due
February 1, 2008.


BURLINGTON: WL Ross Pitches Bid to Acquire Assets for $620 Mil.
---------------------------------------------------------------
Burlington Industries, Inc. (OTC Bulletin Board: BRLG) entered
into an agreement with WL Ross & Co. LLC by which Ross'
acquisition proposal has been designated the highest and best of
several bids received in connection with the sale process approved
last May by the Court in its reorganization proceedings.  The
agreement contemplates the sale of Burlington to WL Ross & Co.,
with a concurrent sale of Burlington's Lees carpet business to
Mohawk Industries Inc. (NYSE: MHK)

The terms of the Burlington-Ross agreement calls for a $614.0
million payment to Burlington in cash at closing plus a $6.08
million credit for enhancement of a negotiated break-up fee.

George W. Henderson, III, Chairman and CEO, commented, "We are
pleased [with] the bidding process . . . and we believe it will
enable us to maximize the value of the company and produce the
best results for our customers, employees, suppliers and
creditors."

Ross' winning bid at an auction that concluded yesterday is
expected to be submitted for approval of the Bankruptcy Court at a
hearing scheduled for July 31.  If approved at this hearing, the
sale transaction will be incorporated into a plan of
reorganization to be submitted for approval to the creditor
constituencies of the Company following a hearing on a disclosure
statement describing the sale and other provisions of the
emergence plan.

Burlington estimates that distributions to unsecured creditors
will be approximately 40% of allowed unsecured claims and that
secured creditors will be repaid in full. That estimate is based
upon various assumptions, however, and the actual recovery may be
different.

The parties contemplate a closing in October.  The completion of
the Ross transaction is subject to various conditions in addition
to completing the auction process. Accordingly, there can be no
assurance that it will occur.

Wilbur L. Ross, Chairman of WL Ross & Co. LLC, said, "Lees will
benefit from Mohawk's financial strength and business synergies.
Burlington's other operations also will be deleveraged and as
privately owned businesses will function even more efficiently and
responsively to meet the needs of their customers. Employees will
no longer have to worry about the financial viability of their
company."

Bob Lee, Managing Member of Sheffield Merchant Banking Group, the
financial advisor to the Official Committee of Unsecured
Creditors, commented, "The Burlington management team and its
advisors ran a very full and effective process. The Committee
supports the proposed transaction and is pleased that this process
indicates an improvement from prior offers."

With operations in the United States, Mexico and India and a
global manufacturing and product development network based in Hong
Kong, Burlington Industries is one of the world's most diversified
marketers and manufacturers of softgoods for apparel and interior
furnishings.


CABLE SATISFACTION: Files CCAA Plan of Arrangement in Canada
------------------------------------------------------------
Cable Satisfaction International Inc. (TSX: CSQ.A) has filed in
Quebec Superior Court its plan of arrangement and reorganization
under the Companies' Creditors Arrangement Act. The plan is
similar in all material respects to the recapitalization plan
announced by the Company on June 13, 2003. The Plan in its final
form and related materials are expected to be sent to creditors on
or before September 15, 2003, in anticipation of a creditors'
meeting in October. There can be no assurance that the plan of
arrangement and reorganization will be completed successfully or
on the terms announced.

Csii builds and operates large bandwidth (750 Mhz) hybrid fibre
coaxial networks and, through its subsidiary Cabovisao - Televisao
por Cabo, S.A. provides cable television services, high-speed
Internet access, telephony and high-speed data transmission
services to homes and businesses in Portugal through a single
network connection.

The subordinate voting shares of Csii are listed on the Toronto
Stock Exchange (TSX) under the trading symbol "CSQ.A".


CONSTELLATION BRANDS: Prices Common & Preferred Stock Offerings
---------------------------------------------------------------
Constellation Brands, Inc. (NYSE: STZ), a leading international
producer and marketer of beverage alcohol brands, has priced the
concurrent public offerings of its Class A common stock and
mandatory convertible preferred stock.  The offerings are expected
to raise net proceeds, excluding the over-allotment options
granted to the underwriters, of approximately $399.5 million,
before expenses.

Constellation has agreed to sell 9,500,000 shares of Class A
common stock at $28.00 per share and 6,000,000 depositary shares
at $25.00 per depositary share.  Each depositary share represents
1/40th of a share of Constellation's Series A mandatory
convertible preferred stock which is convertible into shares of
Constellation's Class A common stock.  The mandatory convertible
preferred stock will have a dividend yield of 5.75% and a
conversion premium of 22.0% over the Class A common stock offering
price of $28.00 per share.  In connection with these offerings,
Constellation has granted the underwriters options to purchase up
to 1,425,000 additional shares of Class A common stock and 820,000
additional depositary shares to cover over-allotments, if any.

Closing of the offerings is expected to occur on July 30, 2003.
The net proceeds of these offerings, together with available cash,
will be used to repay all amounts outstanding under the bridge
loans incurred to finance a portion of the consideration for the
acquisition of BRL Hardy.

Citigroup Global Markets Inc. and J.P. Morgan Securities Inc.
acted as the joint book-running managers and UBS Securities LLC
acted as joint lead manager for the offerings.  The securities may
be offered only by means of a prospectus, including a prospectus
supplement.  A copy of either prospectus including the prospectus
supplement may be obtained from: Citigroup Global Markets Inc.,
140 58th Street, Brooklyn, New York 11220 or J.P. Morgan
Securities Inc., 277 Park Avenue, New York, New York 10017.

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

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

At the same time, Standard & Poor's affirmed its 'BB' corporate
credit and senior unsecured debt ratings on Constellation Brands,
as well as the 'B+' subordinated debt rating on the company.


CUMMINS INC: Reports Solid 2003 Second Quarter Financial Results
----------------------------------------------------------------
Cummins Inc. (NYSE:CUM) reported second quarter earnings of $.34
per share, or $14 million profit after taxes, on sales of $1.54
billion.

The stronger than expected earnings reflect record performance by
the International Distributor and Filtration and Other Businesses.
The quarter also represents significant improvement in the Engine
Business, particularly due to increased sales in the Dodge Ram
truck and a rebound in sales in the North American heavy-duty
truck market. The performance in these three businesses bolstered
profits significantly and the Power Generation Business moved
closer to breakeven while absorbing $5 million of restructuring
costs.

"We believe this quarter's results demonstrate that we are well
positioned for the market upturn. Three of our four businesses are
performing well, and the fourth business has taken necessary
actions to return to profitability," said Tim Solso, Chairman and
Chief Executive Officer. "We are delivering the right products to
the market for our customers. We are generating positive cash
flow, while funding important product development programs. We
remain committed to paying an attractive dividend to our
shareholders and providing a good return to all our stakeholders.
We will continue to tightly manage spending and believe we will
benefit strongly as our markets continue to recover."

                         Engine Business

Total sales for the Engine Business in the second quarter were
$889 million, a 5 percent increase from sales of $850 million a
year ago. Revenues in automotive markets were 6 percent higher
than the second quarter of 2002, with increases in our light-duty
automotive business more than offsetting sales declines in medium-
duty truck and bus engines. Overall revenue from Industrial
markets was up 2 percent year-over-year, with increases in mining
and government markets and decreases in revenues from rail and
marine engines.

The Engine Business continues to benefit from the successful
launch of our complete line of emission-compliant engines. There
are now more than 16,000 of the new ISX and ISM heavy-duty engines
in the field, with almost 450 million miles of service
accumulated. By October, the Company expects to have more than
25,000 engines in service, with close to one billion miles of
reliable performance.

The award-winning Cummins Turbo Diesel engine made for the Dodge
Ram truck continues to perform very well and has strong market
acceptance. Engine sales volume for the Dodge Ram over the last
three quarters creates a new shipment record for Cummins. For the
second consecutive year, our engine was named the best among all
Chrysler engines and first among diesel engines for heavy-duty
pickup trucks, as recently reflected in a report released by J.D.
Powers and Associates.

                         Power Generation

Sales in the Power Generation Business for the second quarter were
$307 million, essentially flat with the second quarter of 2002.

In North America, revenues were down 2 percent compared to a year
ago, with continued weak demand in our commercial genset business.
Demand in our consumer business remained strong, with sales 2
percent higher than the second quarter of 2002. Outside North
America, revenues increased 3 percent in total, with decreases in
Latin America and parts of Asia more than offset by increases in
Europe and Australia.

                        Filtration and Other

Revenues for the Filtration and Other Business were $265 million
for the quarter, a 9 percent increase compared to the second
quarter of 2002. This marks a record sales quarter for the
segment, despite continued weakness across most markets it serves.

Fleetguard secured another long-term supply agreement in the
quarter with CNH Global N.V. and continues to pursue similar
agreements with other major original equipment manufacturers. The
segment also continues to benefit from the profitable growth of
the Emission Solutions business. Emission Solutions continues to
achieve growth targets, while funding technologies necessary to
meet future emissions requirements.

                     International Distributor

Sales for the International Distributor Business were $169 million
in the second quarter, an increase of 17 percent compared to sales
of $145 million last year, with improvement across most regions.

The International Distributor Business continues to demonstrate
its stable earnings capabilities. Earnings performance reached a
record level in the second quarter. This business is increasing
parts and service revenues and is benefiting from best-practice
sharing across distributors.

                            Guidance

Cummins expects third quarter earnings in the range of $.60 to
$.70 per share. Our earnings guidance for the year remains in the
previous range of $1.20 to $1.40 per share. The Company's free
cash flow for the year is still expected to be in the range of $70
to $80 million - sufficient to fund our dividend and provide for
some modest debt reduction in 2003. Cummins expects capital
expenditures for the year to be below $110 million.

                       Restatement Update

On April 14th, the Company announced that it would restate prior
period financial statements. This restatement required a re-audit
of the 2000 and 2001 financial statements by the Company's new
auditors, PricewaterhouseCoopers, LLP since Arthur Andersen, LLP
was Cummins auditors for those periods and is no longer providing
auditing services. The Company is pleased to announce that the re-
audit and restatement work is substantially complete.

Cummins is completing financial statements and disclosures and
expects to file the Company's 2002 Form 10-K as well as first and
second quarter Form 10-Qs for 2003 in the near future. Until the
Form 10-K is filed, the Company will not release comparisons with
prior periods. Once Cummins files the 2002 Form 10-K, the Company
will announce the date of its Annual Shareholders Meeting.

Cummins Inc., a global power leader, is a corporation of
complementary business units that design, manufacture, distribute
and service engines and related technologies, including fuel
systems, controls, air handling, filtration, emission solutions
and electrical power generation systems. Headquartered in
Columbus, Indiana, (USA) Cummins serves its customers through more
than 500 company-owned and independent distributor locations in
131 countries and territories. With 23,700 employees worldwide,
Cummins reported sales of $5.9 billion in 2002. More information
can be found at http://www.cummins.com

                           *   *   *

As previously reported in Troubled Company Reporter, Fitch Ratings
downgraded the senior unsecured notes of Cummins Inc., to 'BB-'
from 'BB+', assigned a rating of 'BB-' to the $200 million in new
senior unsecured notes being issued, and assigned a rating of
'BB+' to the newly established $385 million secured revolving
credit agreement. The company's mandatorily redeemable convertible
preferred securities have also been downgraded to 'B+' from 'BB-'.

The downgrades reflect persistently weak end markets, longer term
concerns related to the company's competitive position and
profitability, weak credit measures, increasing pension
obligations and the granting of security to the company's
revolving credit lenders (resulting in the subordination of the
unsecured notes and preferred securities). The Rating Outlook
remains Negative.


DELTA AIR LINES: Commences Exchange Offer for M-T and Sr. Notes
---------------------------------------------------------------
Delta Air Lines (NYSE: DAL) intends to make an exchange offer for
$300 million outstanding principal amount of its 6.65 percent
Medium-Term Notes, Series C due 2004, and $500 million outstanding
principal amount of its 7.70 percent Senior Notes due 2005.

In the exchange offer, Delta is offering to exchange $545 in
principal amount of its new 10 percent Senior Notes due 2008 (or
$525 principal amount of new notes if the 2004 notes are tendered
after the early tender date) for each $1,000 principal amount of
2004 notes tendered, and $500 in cash.  For each $1,000 principal
amount of 2005 notes tendered, Delta is offering to exchange
$1,040 in principal amount of new notes (or $1,020 principal
amount of new notes if the 2005 notes are tendered after the early
tender date).

The early tender date will be 5:00 p.m., New York City time, on
August 8, 2003, unless extended, and the exchange offer will
expire at 5:00 p.m., New York City time, on August 25, 2003,
unless extended.

The exchange offer will be subject to customary conditions,
including the receipt of valid and unwithdrawn tenders of old
notes that would result in issuance of at least $200 million in
aggregate principal amount of the new notes.  Tenders of
outstanding old notes pursuant to the exchange offer may be
withdrawn at any time on or prior to the withdrawal deadline,
which will be 5:00 p.m., New York City time, on August 8, 2003,
unless extended.

The new notes offered in the exchange offer will not be registered
under the Securities Act of 1933, as amended, and will only be
offered in the United States to qualified institutional buyers in
a private transaction.

Delta Air Lines, the world's second largest airline in terms of
passengers carried and the leading U.S. carrier across the
Atlantic, offers 5,734 flights each day to 444 destinations in 79
countries on Delta, Song, Delta Express, Delta Shuttle, Delta
Connection and Delta's worldwide partners. Delta is a founding
member of SkyTeam, a global airline alliance that provides
customers with extensive worldwide destinations, flights and
services. For more information, go to http://www.delta.com

As reported in Troubled Company Reporter's July 10, 2003 edition,
Standard & Poor's Ratings Services affirmed its ratings on Delta
Air Lines Inc. (BB-/Negative/--) and removed them from
CreditWatch, where they were placed on March 18, 2003. The ratings
were lowered to current levels on March 28. The outlook is
negative.


DELTA AIR: Gen. Counsel Robert Harkey Plans to Retire by Dec. 31
----------------------------------------------------------------
Delta Air Lines' (NYSE: DAL) Chairman and Chief Executive Officer
Leo F. Mullin announced that Robert S. Harkey, Delta's general
counsel since 1988, plans to retire on Dec. 31, 2003, after 35
years with Delta.

"Bob Harkey has been an outstanding general counsel who combines
sound legal advice with a deep understanding of Delta's business,"
Mullin said. "Bob's earned his unmatched perspective on our
company and our industry as he has provided advice and counsel for
every CEO of Delta except our founder, C. E. Woolman.  We wish him
well."

"I have had an incredibly interesting and rewarding career at
Delta, and I will miss it and all of the wonderful and capable
people I've had the opportunity to work with," Harkey said.  "I
look forward to a seamless transition to a very strong team over
the new few months, and then to an exciting new phase of my life,
with particular emphasis on my family."  Harkey will be 63 when he
retires.

The role of general counsel will be assumed by Greg L. Riggs, 55,
currently vice president and deputy general counsel, who is a 24-
year veteran of Delta.  His promotion to senior vice president --
general counsel will be effective Sept. 1.  As of that date,
Harkey's title will be changed to senior vice president -
corporate affairs and secretary, and he will retain that role
until retirement at the end of year.

Also effective Sept. 1, Walter A. Brill, 54, currently vice
president - associate general counsel and Lesley P. Klemperer, 48,
currently vice president - associate general counsel and assistant
secretary, both will be promoted to vice president - deputy
general counsel.  John J. Varley , 47, who is currently assistant
general counsel, will be promoted to associate general counsel as
of that date.

Delta Air Lines, the world's second largest airline in terms of
passengers carried and the leading U.S. carrier across the
Atlantic, offers 5,734 flights each day to 444 destinations in 79
countries on Delta, Song, Delta Express, Delta Shuttle, Delta
Connection and Delta's worldwide partners. Delta is a founding
member of SkyTeam, a global airline alliance that provides
customers with extensive worldwide destinations, flights and
services. For more information, go to http://www.delta.com

As reported in Troubled Company Reporter's July 10, 2003 edition,
Standard & Poor's Ratings Services affirmed its ratings on Delta
Air Lines Inc. (BB-/Negative/--) and removed them from
CreditWatch, where they were placed on March 18, 2003. The ratings
were lowered to current levels on March 28. The outlook is
negative.


DYNAMOTIVE ENERGY: Moving Forward with Restructuring Activities
---------------------------------------------------------------
DynaMotive Energy Systems Corporation (OTCBB:DYMTF) provided an
update on activities for the second quarter of 2003 and its going-
forward plan for the year.  Mr. Andrew Kingston President and CEO
reviewed the Company's achievements in the quarter:

"The focus of management activities for the second quarter was
towards the re-establishment of shareholder value and to position
the Company for accelerated growth. I am pleased to be able to say
that these objectives have been met at both the corporate and
project levels. Restructuring of operations is nearly complete,
and has resulted in significant reductions of commercial and
technical development costs totaling US$ 2.75 million for 2003.
The Company also expects to meet its overhead run-rate estimates
for 2003 of under US$2 million.

"Financing Activities: In January, the Company announced that it
was initiating a US$2 million financing to meet working and
development capital needs for 2003. The Company expects to
complete this placement at the time of filing its overdue
financial statements in mid August.

"Auditing of 2002 Financial Statements: The Company is progressing
with the audit process that should be completed by mid August. The
Company then expects to be up to date with filings with the
British Columbia Securities and Exchange Commission and US
Securities and Exchange Commission at that time.

"Strategic Alliances and Project Development: The Company
continued to progress towards a commercial demonstration program
in Canada. A site has been identified for a project capable of
hosting a 100 tpd plant for the production of BioOil which will be
designed to generate both heat and power in an industrial setting.
The integrated plant will utilize wood residue from Erie
Flooring's Ontario operations and will be comprised of wood
conditioning equipment, pyrolysis plant and power island.
Pyrolysis and generation equipment are to be provided by
DynaMotive and Magellan Aerospace division-Orenda Industrial
respectively. Erie Flooring is to provide wood residue for the
project and will receive electricity and process heat for its
operations. The project will also provide green power to Ontario's
grid system. Ontario Power Generation has entered into an
agreement with the Company to partner in this project. More
progress has been made including the signing of a MOU with Ramsay
Machine works Ltd. that will establish the basis for the
fabrication and design of multiple pyrolysis systems. UMA
Engineering Ltd. would act as project engineers. The Company has
also entered into a MOU with Bruks-Klockner Inc., a world leading
company for wood processing equipment to participate in the
development of this project. Furthermore, in June 2003, the
project was approved to receive a funding contribution from
Sustainable Development Technology Canada. Total amount of the
funding will be announced in Q3 upon completion of contract
negotiation.

"Once completed, the Erie project should demonstrate that the
technology will meet the commercial criteria required for the
future development of many other commercial projects. Assuming the
success of this project and the generation of similar
opportunities, the Company expects to meet its target of reducing
its capital investment requirements by up to $4,000,000.

"Product R & D: Following the launch in Q1 of the Company's Lime
Kiln program to validate the use of BioOil as a fuel for lime
kilns in the pulp and paper industry, DynaMotive confirmed that
BioOil match natural gas performance in test conducted under the
supervision of Professor Paul Watkinson of the University of
British Columbia. The program is expected to be completed in Q3
this year. DynaMotive's objective through this program is to
provide an environmentally friendly and economically viable
alternative to fossil fuel consumption, and to reduce or eliminate
waste disposal costs and provide green house gas credits to the
users. DynaMotive estimates that the market worldwide within this
industry could exceed 160 plants, each producing 1860 barrels of
BioOil per day (or 1000 barrels of oil equivalent (BOE)).

"Intellectual Property Protection: A cornerstone of the Company's
value is its capacity to protect technology secrets and
improvements. The Company, following the completion of its pilot
plant programs, has undergone a complete evaluation of technical
and process improvements. The Company has completed an IP review
in Q2 and is in the process of applying for new patents for
improvements to its technology and processes.

"The Company continues to execute in accordance to its business
plan. Having completed the restructuring and streamlining of
operations, the Company expects to further accelerate its
development in the third and fourth quarters. Interest in the
Company's technology is growing rapidly as are the potential
applications for BioOil. Corporate fundamentals are strong and the
market opportunity is outstanding."

                            *    *    *

In its most recent SEC Form 10-K filing, the Company reported:

"In May 2001, the Company announced its intention to divest its
metal cleaning subsidiary, DynaPower, Inc., to focus all of its
resources on its BioOil production technology. This divestiture
was completed April 11, 2002.

"These financial statements have been prepared on the going
concern basis, which presumes the Company will be able to
realize its assets and discharge its liabilities in the normal
course of operations for the foreseeable future.

"As at December 31, 2001, the Company has a working capital
deficiency of $2,069,212, has incurred a net loss of $6,838,264
for the year-ended December 31, 2001, and has an accumulated
deficit of $25,773,048.

The ability of the Company to continue as a going concern is
uncertain and is dependent on achieving profitable operations,
commercializing its BioTherm(TM) technology and continuing
development of new technologies, the outcome of which cannot be
predicted at this time. Accordingly, the Company will require,
for the foreseeable future, ongoing capital infusions in order
to continue its operations, fund its research and development
activities, and ensure orderly realization of its assets at
their carrying value. The consolidated financial statements do
not reflect adjustments in carrying values and classifications
of assets and liabilities that would be necessary should the
Company not be able to continue in the normal course of
operations.

"The Company is not expected to be profitable during the ensuing
twelve months and therefore must rely on securing additional
funds from government sources and by the issuance of shares of
the Company for cash consideration. The Company has received
commitments from the Canadian and UK governments and subsequent
to the year-end, the Company has received a subscription
agreement for up to $1.6 million in equity financing."


DYNEGY INC: Second Quarter 2003 Net Loss Hits $290 Million
----------------------------------------------------------
Dynegy Inc. (NYSE:DYN) reported a net loss of $290 million for the
second quarter 2003. Although the company's operating businesses
demonstrated solid performance, quarterly results were impacted by
an aggregate net loss of $240 million from its customer risk
management segment, which Dynegy continues to exit, and its former
communications business.

After eliminating the impact of these losses, the after-tax loss
for the quarter was $50 million. This reflects the results of the
company's power generation, natural gas liquids and regulated
energy delivery businesses and an after-tax charge of $32 million
for legal reserves recorded in connection with certain pending
litigation matters.

"The quarter was marked by significant progress in our self-
restructuring, including the completion of a $1.66 billion bank
refinancing well before its scheduled maturity," said Bruce A.
Williamson, president and chief executive officer of Dynegy Inc.
"We were also successful in maintaining our strong liquidity
position and further reducing collateral -- two of the most
significant indicators of our ongoing financial viability -- while
announcing a long-term refinancing and restructuring plan.

"However, our second quarter results were significantly affected
by charges associated with our remaining customer risk management
business and an additional reserve for pending litigation,"
Williamson added. "These charges will not affect our ongoing
operational performance, and we remain focused on exiting the
third-party marketing and trading business and resolving our
outstanding legal issues in a thorough and deliberate manner."

For purposes of this news release, the commodity pricing forecasts
referred to below represent the assumptions provided by the
company on Jan. 7, 2003.

                         Power Generation

Earnings before interest and taxes from the power generation
business was $61 million for the second quarter 2003. This
segment's performance benefited from continued favorable commodity
prices during the quarter, with a weighted average on-peak power
price of $44.96 per megawatt-hour, a 25 percent increase over the
company's forecasted price of $36.

This segment generated 8.3 million net megawatt-hours of
electricity for the second quarter 2003, representing an 8 percent
decrease from the second quarter 2002. This is primarily due to
the deferral of scheduled maintenance of some units from the first
to the second quarter. All of the spring 2003 scheduled
maintenance was completed by the end of May.

                       Natural Gas Liquids

EBIT from the natural gas liquids business was $35 million for the
second quarter 2003. This segment's performance benefited from
higher commodity prices, with an average natural gas price of
$5.63 per MMBtu, a 41 percent increase over the company's
forecasted price of $4. The average crude oil price of $29.31 per
barrel represented a 9 percent increase over the company's
forecasted price of $27 and the average natural gas liquids price
of $0.51 per gallon was a 13 percent increase over the company's
forecasted price of $0.45. Approximately three-quarters of the
production volumes for the natural gas liquids segment are
contracted for on a percent of proceeds/percent of liquids basis,
which enabled this segment to benefit from the higher commodity
prices offered by the market.

These results were partially offset by reduced fractionation
volumes and lower keep-whole fractionation spreads. Natural gas
liquids fractionation volumes were 188 thousand barrels per day
for the second quarter 2003, representing a 22 percent decrease
from the second quarter 2002. Fractionation volumes associated
with percent of proceeds/percent of liquids plants were in line
with the company's forecast, while keep-whole plant volumes were
below forecast due to the economic decision to shut-down certain
plants or bypass gas due to compressed fractionation spreads.

                    Regulated Energy Delivery

EBIT from the regulated energy delivery business totaled $35
million for the second quarter 2003. This segment's performance
was adversely affected by the lower customer demand traditionally
associated with the second quarter and weather conditions in the
Midwest that interrupted service toward the latter part of the
period.

During the quarter, electric and natural gas demand was slightly
lower than the company's forecast. This segment delivered total
electricity of 4,387 million kilowatt-hours for the second quarter
2003, compared to 4,648 million kilowatt-hours for the second
quarter 2002. Total natural gas delivered for the quarter was 126
million therms, compared to 140 million therms for the second
quarter 2002.

                    Customer Risk Management

Losses before interest and taxes for the customer risk management
segment totaled $368 million for the second quarter 2003. This
segment's results were adversely affected by the following
previously announced pre-tax losses: $133 million associated with
the final settlement of power tolling arrangements with Southern
Company; $30 million associated with the final settlement of
certain power supply agreements with Kroger Company; and a $132
million mark-to-market loss on contracts associated with the Sithe
Independence power tolling arrangement. The remaining $73 million
in losses for this segment were related to Dynegy's continuing
efforts to complete its exit from this business. The company's
customer risk management business, including obligations relating
to its five remaining power tolling contracts, will continue to
affect its results of operations until the related obligations
have been satisfied or restructured.

                      Corporate and Other

Discontinued operations for the second quarter included a pre-tax
loss of $3 million related primarily to the company's former
communications business. The $104 million operating loss (noted as
"Other" in the Reported Segmented Results of Operations tables in
this news release) included a pre-tax charge of approximately $50
million for legal reserves, as well as other general and
administrative expenses and depreciation. The interest expense and
effective tax rate were substantially in line with expectations.

Net loss available to common shareholders of $372 million for the
second quarter 2003 included a deduction of approximately $82
million for the amortization of the implied dividend associated
with the $1.5 billion Series B mandatorily convertible redeemable
preferred stock issued to ChevronTexaco in late 2001.

                          Liquidity

At July 21, 2003, Dynegy's liquidity was $1.7 billion. This
consisted of $872 million in cash and $1.1 billion in revolving
bank credit, less $248 million in letters of credit posted against
that line of credit. Revolving credit facility exposure, including
letters of credit and borrowings, totaled approximately $250
million on July 21, 2003. Total collateral posted as of July 21,
including cash and letters of credit, was approximately $725
million.

In addition to increasing its liquidity position to $1.7 billion
from $1.6 billion at June 30, Dynegy has also reduced its debt by
$28 million since June 30.

                    First Half 2003 Cash Flow

Operating cash flow, including working capital changes, was
approximately $440 million for the first half of 2003. This
consisted of approximately $220 million from the power generation,
natural gas liquids and regulated energy delivery businesses and
approximately $220 million from the customer risk management roll-
off, less corporate-level expenses and cash flows from the
company's former communications business. Operating cash flow was
impacted by the termination payment for the Southern tolling
arrangements of approximately $155 million and the settlement
payment in global communications of $45 million.

Additionally, rather than drawing letters of credit from its
revolving credit facility, the company is currently using more
cash as collateral with certain high-credit quality
counterparties. As a result, the company is not incurring higher
letter of credit fees relative to cash interest income and has not
realized a return in cash collateral as expected.

Investing cash flow uses for the six months of 2003 totaled
approximately $160 million. This consisted of approximately $190
million in capital expenditures in the company's operating
businesses offset by approximately $30 million in proceeds from
asset sales.

                    2003 Guidance Estimate

Dynegy's recently announced long-term refinancing plan, which
includes its plans to refinance its 2005-2006 debt maturities and
to restructure the ChevronTexaco Series B preferred stock, is
expected to result in higher interest costs for the remainder of
the year. These higher interest costs, coupled with the reserve
for litigation and higher general and administrative expenses,
will result in a lower guidance estimate for 2003. Commodity
pricing and volume fundamentals for the company's operational
segments are currently in line with management's expectations for
the remainder of the year. The revised guidance estimate will
continue to exclude the results associated with the company's
customer risk management business, which includes tolling
contracts, and its discontinued operations, which includes the
company's former communications business, as well as related exit
costs. Dynegy will update its estimate following the expected
completion of the long-term refinancing plan.

                       Filing of Form 10-K/A

Dynegy filed an amendment to its 2002 Form 10-K Friday with the
Securities and Exchange Commission. The amendment contains
reclassified historical financial statements to conform to the
company's current reporting format, which changed Jan. 1, 2003.
This reclassification does not affect Dynegy's reported net income
for the periods presented.

Dynegy Inc. provides electricity, natural gas, and natural gas
liquids to wholesale customers in the United States and to retail
customers in the state of Illinois. The company owns and operates
a diverse portfolio of energy assets, including power plants
totaling more than 13,000 megawatts of net generating capacity,
gas processing plants that process more than 2 billion cubic feet
of natural gas per day and approximately 40,000 miles of electric
transmission and distribution lines.


EAGLE FOOD CENTERS: Will Padlock Four Underperforming Stores
------------------------------------------------------------
Eagle Food Centers, Inc., which owns and operates supermarkets in
Illinois and Iowa, will close four underperforming stores in
Princeton and Davenport. As part of its store evaluation and
ongoing restructuring plan, the Company concluded that the best
course of action for these four stores would be closure.

The store in Princeton, Illinois will close on August 26, 2003 and
the three stores in Davenport, Iowa will close on September 2,
2003.

"Eagle continues to market the stores for sale and looks forward
to optimizing the outcome for all of its constituencies. To date
we have not received bids on these particular locations and felt
it was necessary to close these stores given their poor
performance," said Eagle Chairman, Chief Executive Officer and
President Robert J. Kelly.

The deadline for submitting bids in the competitive bid process
being conducted under section 363 of the U.S. Bankruptcy Code has
been extended to August 8, 2003.

The Company operates 51 Eagle Country Markets in Iowa and
Illinois.


ENRON CORP: Liquidation Analysis Will Show Chapter 11 Plan is Best
------------------------------------------------------------------
Enron Corporation and its debtor-affiliates have evaluated
numerous reorganization alternatives to the Plan.  After
evaluating these alternatives, the Debtors concluded that the
Plan, assuming confirmation and successful implementation, is the
best alternative and will maximize recoveries by holders of
Claims.

If the Plan is not confirmed, Stephen F. Cooper, Acting President,
Acting Chief Executive Officer and Chief Restructuring Officer of
Enron Corp., says, then the Debtors could remain in Chapter 11.
Should this occur, the Debtors could continue to operate their
businesses and manage their properties as debtors-in-possession,
but they would remain subject to the restrictions the Bankruptcy
Code imposed.  Moreover, the Debtors, subject to further
Bankruptcy Court determination as to extensions of exclusivity
under the Bankruptcy Code, any other party-in-interest could
attempt to formulate and propose a different plan or plans.  This
would take time and result in an increase in the operating and
other administrative expenses of these Chapter 11 Cases.  Thus,
the Debtors believe that the Plan enables Claim holders to realize
the greatest recovery under the circumstances.

Notwithstanding anything contained in the Plan to the contrary,
the Debtors, if jointly determined after consultation with the
Creditors' Committee, may, after obtaining the requisite
approvals:

    (a) from one or more holding companies to hold the common
        stock of the Entities to be created and issue the equity
        interest therein in lieu of the common stock to be issued,
        and

    (b) from one or more limited liability corporations in lieu
        of the Entities to be created in accordance with the Plan
        and issue the membership interests therein in lieu of the
        common stock to be issued in accordance with the Plan.

If no Chapter 11 plan can be confirmed, Mr. Cooper says, the
Debtors' cases may be converted to cases under Chapter 7 of the
Bankruptcy Code, whereby a trustee would be elected or appointed
to liquidate the Debtors' assets for distribution to the holders
of Claims in accordance with the strict priority scheme the
Bankruptcy Code established.

Under Chapter 7, the cash amount that would be available for the
satisfaction of the Debtors' Unsecured Claims and Equity Interests
would consist of the proceeds resulting from the Debtors'
unencumbered assets disposition, augmented by the unencumbered
cash the Debtors held at the time of the commencement of the
liquidation cases.  Mr. Cooper notes that this cash amount would
be reduced by the liquidation costs and expenses and by additional
administrative and priority claims that may result from the
termination of the Debtors' businesses and the use of Chapter 7
for liquidation.

According to Mr. Cooper, the Debtors' liquidation costs under
Chapter 7 would include the fees payable to a trustee in
bankruptcy, as well as those payable to attorneys, investment
bankers, and other professionals that a trustee may engage, plus
any unpaid expenses incurred by the Debtors during the Chapter 11
Cases, including compensation for attorneys, financial advisors,
accountants, and costs and expenses of members of any official
committees that are allowed in the Chapter 7 cases.

In addition, Claims could arise through the breach or rejection
of obligations incurred and executory contracts entered into or
assumed by the Debtors during the pendency of these Chapter 11
Cases.  These Claims would be paid in full from the liquidation
proceeds before the balance of those proceeds would be made
available to pay prepetition Claims.

In the contrary, all pre-Chapter 11 Unsecured Claims that have
the same rights upon liquidation would be treated as one class
for the purposes of determining the potential distribution of the
liquidation proceeds resulting from the Debtors' Chapter 7 cases.
The distributions from the liquidation proceeds would be
calculated on a pro rata basis according to the Claim amount each
Creditor held.  Therefore, Mr. Cooper concludes, creditors who
claim to be third-party beneficiaries of any contractual
subordination provisions might have to seek to enforce contractual
subordination provisions in the Bankruptcy Court or otherwise.

The Debtors believe that the most likely outcome of liquidation
proceedings under Chapter 7 would be the application of the rule
of absolute priority of distributions.  Under this rule, no
junior creditor receives any distribution until all senior
creditors are paid in full with interest and no stockholder
receives any distribution until all Creditors are paid in full
with postpetition interest.  Consequently, the Debtors believe
that pursuant to Chapter 7, holders of Enron Subordinated
Debenture Claims, Enron Preferred Equity Interests, Statutorily
Subordinated Claims, Enron Common Equity Interests and Other
Equity Interests would receive no distributions.

After consideration of the effects that a Chapter 7 liquidation
would have on the ultimate proceeds available for distribution to
Creditors in the Chapter 11 Cases, including:

    (a) the increased costs and expenses of a liquidation under
        Chapter 7 arising from fees payable to a trustee in
        bankruptcy and professional advisors to the trustee;

    (b) the substantial erosion in value of assets in a Chapter
        7 case in the context of the "forced sale" atmosphere
        that would prevail;

    (c) the adverse effects on the saleability of business
        segments as a result of the departure of key employees,
        the loss of customers and suppliers; and

    (d) the substantial increases in claims that would be
        satisfied on a priority basis or on a parity with
        Creditors in the Chapter 11 Cases, the Debtors believe
        that confirmation of the Plan will provide each holder
        of an Allowed Claim or Allowed Equity Interest with not
        less than the amount it would receive pursuant to a
        liquidation of the Debtors' assets under Chapter 7 of
        the Bankruptcy Code.

The Debtors also believe that any distributions value from the
liquidation proceeds to each Class of Allowed Claims in a Chapter
7 case would be less than the value of distributions under the
Plan because the distributions in a Chapter 7 case would not
occur for a substantial time period.  It is likely that
distribution of the liquidation proceeds could be delayed for
several years after the completion of the liquidation to resolve
claims and prepare for distributions.  "In the likely event
litigation were necessary to resolve claims asserted in the
Chapter 7 cases, the delay could be prolonged," Mr. Cooper
emphasizes.

The Debtors have not delivered a copy of their liquidation
analysis showing how much better creditors fare under the plan
than in a chapter 7 liquidation scenario.  The liquidation
analysis will be delivered to the Court at a later date and will
be annexed as an exhibit to the final version of the Disclosure
Statement sent to creditors. (Enron Bankruptcy News, Issue No. 75;
Bankruptcy Creditors' Service, Inc., 609/392-0900)


FEDERAL-MOGUL: Wants Lease Decision Deadline Moved to December 1
----------------------------------------------------------------
Federal-Mogul Corporation and its debtor-affiliates ask the Court
for a four-month extension of the deadline in which they may elect
to assume or reject non-residential real property leases, through
December 1, 2003.

The Real Property Leases relate to numerous facilities integral
to the Debtors' ongoing business operations.  While the Debtors'
management has largely completed the process of evaluating each
of the Leases for their economic desirability and compatibility
with their long-term strategic business plan, the evaluation
process is not yet entirely complete.  In addition, the Debtors
have identified one or more Real Property Leases that they intend
to reject in the future once the business operations at that
location have been relocated or sold.

The process of evaluating Real Property Leases has taken place as
the Debtors want to:

    (a) consolidate their facilities to eliminate redundancies and
        inefficiencies; and

    (b) shift certain manufacturing efforts to portions of the
        country and the world more suitable to their businesses,
        consistent with their overall business plan.

The evaluation process, Laura Davis Jones, Esq., at Pachulski,
Stang, Ziehl, Young, Jones & Weintraub, P.C., in Wilmington,
Delaware, tells the Court, is a thorough, careful, and deliberate
one.  Without an extension of the current deadline, the Debtors
could be forced prematurely to assume Real Property Leases that
would later be burdensome, giving rise to large potential
administrative claims against their estates and hampering their
ability to reorganize successfully.  On the other hand, the
Debtors would be forced to prematurely reject Real Property
Leases that would have been of benefit to their estates.  Ms.
Jones adds that the extension is necessary to preserve the
Debtors' maximum flexibility in restructuring their business,
given its inherent fluidity in the operation of a large, complex
business enterprise.

Pending the election to assume or reject the Real Property
Leases, the Debtors will timely perform all of their obligations
arising from the Petition Date, including paying postpetition
rent as required by Section 365(d)(3) of the Bankruptcy Code.
Therefore, there should be no prejudice to the affected lessors
as a result of the requested extension, Ms. Jones says. (Federal-
Mogul Bankruptcy News, Issue No. 40; Bankruptcy Creditors'
Service, Inc., 609/392-0900)


FLEMING COMPANIES: Earns Nod to Pay $15 Million C&S Break-Up Fee
----------------------------------------------------------------
To compensate C&S Wholesale Grocers Inc. and C&S Acquisition LLC
for the time, effort, expense and risk that they have incurred
and will incur in negotiating, documenting, and seeking to
consummate the sale transaction, Judge Walrath authorized Fleming
Companies, Inc., and debtor-affiliates to reimburse C&S up to
$4,000,000 in expenses and pay an $11,000,000 break-up fee as
contemplated under the Asset Purchase Agreement.  The Break-Up Fee
and Expense Reimbursement Payment are necessary to induce C&S to
proceed with the purchase of the Wholesale Business.  C&S had
indicated that it is not prepared to proceed with the transaction
unless it has assurance that it will receive the Fees.

The Purchase Agreement provides for the immediate reimbursement
of expenses and the payment of a break-up fee to C&S if the
transaction is terminated in these circumstances:

   (i) By either party as a result of the Debtors' selection of
       another bidder as the Successful Bid at the conclusion of
       the Auction;

  (ii) By Debtors because the Maximum Cure Amounts exceed the
       $22,000,000 Cure Cap; and

(iii) By C&S as a result of the Debtors' uncured breach.

The Debtors will also reimburse C&S for expenses if the Purchase
Agreement is terminated by C&S on or after September 16, 2003
because the Initial Closing Date has not yet occurred through no
fault of C&S.

The Break-Up Fee and Expense Reimbursement Payment amount to 4%
of the C&S Purchase Price.

"[C&S'] willingness to commit to the sales transaction, to
continue to perform the activities necessary to consummate the
transaction, and to serve as a 'stalking horse' against which
other prospective purchasers will be compared in and of itself
represents a significant contribution to the estates," Laura
Davis Jones, Esq., at Pachulski, Stang, Ziehl, Young, Jones &
Weintraub P.C., says.  "As a result, by agreeing to pay the
Break-Up Fee and Expense Reimbursement, the [Debtors] ensure that
their estates will have the benefit of [C&S'] initial offer
without sacrificing the potential for interested parties to
submit overbids." (Fleming Bankruptcy News, Issue No. 10;
Bankruptcy Creditors' Service, Inc., 609/392-0900)


GE HOME: Fitch Ratchets Junks Class B-3 Rating Down to C
--------------------------------------------------------
Fitch Ratings has taken rating action on the following GE Home
Equity Issue:

                        Series 1999-HE1

        -- Class B-3 downgraded to 'C' from 'CC'.

The credit support for the class B-3 has been reduced to '0' due
to the level of losses. On June 25, 2003, the bond took a
principal writedown. Although the transaction's structure allows
for the writedown amount to be repaid in subsequent months, if
there are recoveries in the future, the structure does not allow
for interest on the written down amount to be repaid.


GENCORP INC: Preparing to Offer $175MM Senior Subordinated Notes
----------------------------------------------------------------
GenCorp Inc. (NYSE: GY) is planning to issue $175,000,000 Senior
Subordinated Notes due 2013 in a private placement to
institutional investors.

The primary purpose of the offering is to finance the acquisition
by GenCorp's subsidiary, Aerojet-General Corporation, of
substantially all of the assets related to the propulsion business
of Atlantic Research Corporation, a subsidiary of Sequa
Corporation, and to refinance existing indebtedness. The proposed
acquisition is expected to close upon receipt of regulatory and
other approvals, including approval under the Hart-Scott-Rodino
Antitrust Improvement Act of 1976, as amended.  The company
currently expects to receive the necessary approvals in late
summer of 2003

GenCorp is a global, technology-based manufacturer with leading
positions in automotive, aerospace and defense and pharmaceutical
fine chemical industries.  For more information on GenCorp visit
the Company's Web site at http://www.GenCorp.com

As reported in Troubled Company Reporter's July 3, 2003 edition,
Fitch Ratings affirmed the 'BB' rating on GenCorp Inc.'s bank
credit facilities and the 'B+' rating on its subordinated
convertible notes. The Rating Outlook has been revised to Stable
from Positive for all classes of debt.


GENCORP INC: S&P Rates Proposed $175MM Senior Sub. Notes at B+
--------------------------------------------------------------
Standard & Poor's Ratings Services assigned its 'B+' rating to
GenCorp Inc.'s proposed $175 million senior subordinated notes due
2013, which are to be sold under SEC rule 144A with registration
rights. At the same time, Standard & Poor's affirmed its ratings,
including the 'BB' corporate credit rating, on the propulsion and
vehicle sealing system manufacturer. The outlook is stable.

"The proceeds from the proposed notes offering will be used to
finance the purchase of the propulsion business of Sequa Corp.'s
Atlantic Research Corp. for $133 million, with the excess used to
reduce bank debt," said Standard & Poor's credit analyst
Christopher DeNicolo. The acquisition will weaken GenCorp's credit
measures somewhat, but the firm's financial profile will still be
appropriate for current ratings. In addition, the transaction will
improve GenCorp's position in the market for solid propulsion
systems for tactical missiles. The transaction is subject to
regulatory approval and is expected to close later this summer.
The additional debt taken on to finance the acquisition is
expected to increase debt to capital to almost 60% from around 51%
at the end of May 2003.

The ratings on GenCorp Inc. reflect a below-average business
profile, moderate internal cash generation, and satisfactory
credit measures. The Sacramento, California-based company has
three segments: automotive vehicle sealing systems (GDX
Automotive), aerospace and defense (Aerojet), and an operation
manufacturing chemical intermediates used in pharmaceuticals.
The firm also holds substantial real estate, subject to
environmental restrictions, in varying stages of remediation and
qualification for commercial development.

GDX Automotive (around 70% of revenues) manufactures highly
engineered extruded and molded rubber products for vehicle bodies
and window sealing. A significant acquisition in 2000 strengthened
GenCorp's existing automotive sealing operations, especially
regarding customer and geographic diversity, and moderately
improved the firm's business profile. Efforts to combine
operations and reduce costs have improved profitability in this
segment.

Aerojet's (25%) operations consist of solid and liquid rocket
propulsion systems, areas with good growth prospects. The
acquisition of General Dynamics' space propulsion business in 2002
significantly strengthened Aerojet's position in that market and
in combination with the pending ARC propulsion transaction, will
almost double the unit's revenues. Aerojet is also well positioned
to participate in various U.S. missile defense programs. The
market has only a few participants, and barriers to entry are
high. While Aerojet is smaller than some competitors, it has
proprietary technology and performs well in its areas of
expertise. Aerojet's funded backlog was $344 million as of
May 31, 2003.

Fine chemicals (5%) supplies intermediates and bulk
pharmaceuticals to commercial and government customers. Management
has taken significant actions to properly size operations,
resulting in operating profits in 2002 after losses in prior
years.

GenCorp is likely to benefit from increases in defense spending,
especially National Missile Defense, and improved operations at
its automotive and fine chemical units. Management, although
acquisitive, is expected to preserve GenCorp's financial
flexibility and a financial risk profile consistent with current
ratings, paying down debt used for acquisitions with free cash
flow.


GENCORP: Fitch Assigns BB- Rating to Proposed $175M Senior Notes
----------------------------------------------------------------
Fitch Ratings has assigned a rating of 'BB-' to GenCorp's proposed
$175 million senior subordinated unsecured notes and has affirmed
the 'BB' rating on GY's bank credit facilities. The rating on GY's
subordinated convertible notes has been lowered to 'B' from 'B+'
based on the notes' position in the capital structure. The Rating
Outlook remains Stable.

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

GY intends to use the proceeds of the proposed $175 million senior
subordinated unsecured notes to finance the acquisition of ARC
Propulsion. Proceeds generated in excess of the purchase price are
expected to be used to pay down a portion of GY's outstanding bank
facilities.

The ARC Propulsion acquisition is expected to close late summer
once regulatory approvals are received. Under the terms of the
amendment and waiver to the bank credit facilities, GY will be
required to use net proceeds from the financing to reduce amounts
outstanding under the credit facilities if the acquisition is not
completed by December 31, 2003.

On May 5, GY announced that it had agreed to purchase ARC
Propulsion from Sequa Corporation for $133 million in cash. ARC
Propulsion is the division of SQA's Atlantic Research Corporation
that develops and manufactures rocket propulsion systems, gas
generators and auxiliary rocket motors for tactical weapons and
satellite systems.


GERDAU AMERISTEEL: Q2 Conference Call Scheduled for Friday
----------------------------------------------------------
Gerdau Ameristeel Corporation (TSX: GNA) will host a conference
call to discuss its second quarter financial results for the
period ending June 30, 2003. The Company invites all interested
parties to participate.

    DATE:              August 1, 2003

    TIME:              3:00 pm, Eastern Time. Please call in 15
                       minutes prior to start time to secure a
                       line.

    DIAL-IN NUMBER:    416-695-5806 or 1-800-273-9672

    REFERENCE NUMBER:  1463418

    LIVE WEBCAST:      http://www.gerdauameristeel.com. (Please
                       connect to this Web site at least 15
                       minutes prior to the conference call to
                       ensure adequate time for any software
                       download that may be needed to hear the
                       webcast)

    TAPED REPLAY:      416-695-5800 or 1-800-408-3053
                       Available until August 8 at midnight.

Phillip Casey, President and CEO of Gerdau Ameristeel, will chair
the call. A question-and-answer session will follow, at which time
the operator will direct participants as to the correct procedure
for submitting questions.

A live audio Web cast of the call will be available at
http://www.gerdauameristeel.com. Webcast attendees are welcome to
listen to the conference in real-time or on-demand for 90 days.

Gerdau Ameristeel is the second largest minimill steel producer in
North America with annual manufacturing capacity of over 6.8
million tons of mill finished steel products. Through its
vertically integrated network of 11 minimills (including one 50%-
owned minimill), 13 scrap recycling facilities and 26 downstream
operations, Gerdau Ameristeel primarily serves customers in the
eastern half of North America. The company's products are
generally sold to steel service centers, fabricators, or directly
to original equipment manufacturers for use in a variety of
industries, including construction, automotive, mining and
equipment manufacturing. Gerdau Ameristeel's common shares are
traded on the Toronto Stock Exchange under the symbol GNA.TO.

                           *   *   *

As previously reported, Standard & Poor's Ratings Services
assigned its 'BB' bank loan rating to Gerdau Ameristeel Corp.'s
proposed $350 million senior secured revolving bank credit
facility due 2008. Standard & Poor's also assigned its 'B+' rating
to the company's proposed $400 million senior unsecured notes due
2011.

At the same time, Standard & Poor's affirmed its 'BB-' corporate
credit rating on the company. The outlook remains stable.


GLOBAL CROSSING: Court OKs Greenberg Traurig as Special Counsel
---------------------------------------------------------------
The Official Committee of Unsecured Creditors of the Global
Crossing Debtors obtained permission from the Court retain
Greenberg Traurig, LLP as special conflicts counsel, nunc pro tunc
to June 2, 2003. Greenberg will review and analyze alternative
bids for the GX Debtors' stock and assets made by XO
Communications, Inc. or its affiliates and present to the Court
the Committee's view regarding these bids.

Greenberg Traurig will:

     A. assist the Committee with respect to the review,
        investigation and analysis of the XO Bids;

     B. provide the Committee with legal advice with respect to
        its rights, duties and powers in these cases with respect
        to the XO Bids;

     C. prepare reports, pleadings, motions, applications,
        objections and other papers as may be necessary in
        furtherance of the Committee's position with respect to
        the XO Bids;

     D. consult, discuss and negotiate with the Debtors, their
        counsel, the accountants and financial advisors for the
        Debtors, the Committee, its lead counsel, other
        professionals retained in these cases, the United States
        Trustee, and XO and their counsel, accountants and
        financial advisors, arising from or related to the XO
        Bids; and

     E. represent the Committee in hearings and other judicial
        proceedings as necessary in furtherance of the Committee's
        position with respect to the XO Bids.

Greenberg Traurig has previously conducted an extensive conflicts
check in connection with its retention as counsel to the
Subcommittee.  Greenberg Traurig will be compensated in accordance
with the same terms and conditions of its retention by the
Subcommittee, and in accordance with all orders of this Court
applicable to the compensation of Committee professionals. (Global
Crossing Bankruptcy News, Issue No. 44; Bankruptcy Creditors'
Service, Inc., 609/392-0900)


GRUPO IUSACELL: Second Quarter Net Loss Narrows to $124 Million
---------------------------------------------------------------
Grupo Iusacell, S.A. de C.V., (BMV:CEL)(NYSE:CEL) announced
results for the second quarter ended June 30, 2003.

Highlights

-- Adjusted EBITDA improved to 29% in this quarter from 19% a year
   ago

-- Postpaid churn decreased to 2.9% from 3.3% in the second
   quarter of 2002

-- Gross additions in the postpaid segment increased sequentially

-- Postpaid MOUs and ARPUs grew 16% and 2%, respectively, on an
   annual basis

-- Launch of new postpaid service plans continued in the quarter -
   multiple options to meet the needs of high-value customers

-- Verizon Communications and Vodafone Americas BV agreed to
   tender their 73.9% of outstanding shares to Movil Access, S.A.
   de C.V., a Grupo Salinas company

"In the second quarter, customers responded very positively to our
newly launched postpaid service plans, demonstrating that our
commitment to the customer's experience is generating tangible
results. A decrease in postpaid churn, combined with an increase
in network traffic and average revenue per user, helped to improve
adjusted EBITDA to 29% in the period," said Carlos Espinal G.,
Chief Executive Officer of Iusacell. Unless otherwise noted, all
monetary figures are in Mexican pesos and restated as of June 30,
2003 in accordance with Mexican GAAP, except for ARPU (which is in
nominal pesos). The symbols "$" and "US$" refer to Mexican pesos
and U.S. dollars, respectively. Adjusted EBITDA margin, which
expenses rather than capitalizes postpaid handset subsidies and
excludes non-operational transactions.

                      Operational Results

Subscribers as of June 30, 2003 totaled 1.95 million, an 11%
decline from the prior year figure. This was primarily driven by a
reduction in the prepaid base which declined from 1.8 million in
the second quarter of 2002 to 1.6 million in the current quarter.
Gross additions in the second quarter of 2003 totaled 148,000,
compared to 390,000 in the prior year period, and 164,000 in the
first quarter of 2003; the current gross adds figure reflects the
Company's continued focus on high-value subscribers.

Sequentially, the Company's postpaid customer base decreased
nominally, ending at 341,000. Compared to the year ago period,
postpaid customers decreased 11%, primarily due to fewer gross
additions; however, the current postpaid mix is more heavily
weighted towards high-end subscribers. Prepaid customers decreased
5% sequentially and 11% year over year, totaling 1.6 million as of
June 30, 2003, reflecting the Company's prior efforts to grow that
segment in the first half of 2002. The sequential decline in the
prepaid subscriber base is the anticipated result of the Company's
efforts to replace low-usage Incoming Calls Only customers and low
revenue generating prepaid customers with higher value
subscribers.

Postpaid churn improved to 2.9% in the second quarter of 2003 from
3.2% in the second quarter of 2002 and first quarter of 2003,
respectively. The improvement reflects the success of the
Company's new plan offerings and continued focus on customer
service initiatives for high-value postpaid subscribers. Blended
churn, however, was 3.8% compared to 3.0% in the year ago period
and 3.4% in the first quarter of 2003. This can be attributed to
continued turnover among low-usage prepaid customers acquired in
the previous strategic focus on low-end prepaid market effective
in the first half of 2002.

Minutes of use among postpaid customers increased 16% on a year
over year basis, while prepaid MOUs remained unchanged. The new
postpaid service plans have a larger number of minutes included in
the packages, including some with free nights and weekends, which
helped drive a 5% blended MOU increase year over year.

Average revenue per user in the postpaid segment of $687 increased
2% compared to the second quarter 2002, while prepaid ARPUs of $76
increased 1%. Sequentially, postpaid ARPU increased 1% due to a
postpaid subscriber mix more weighted towards higher value service
plans and higher MOUs. Blended ARPU, however, declined from $186
in the second quarter of 2002 to $180 in the second quarter of
2003.

                      Commercial Initiatives

New service plans: In the first half of 2003, Iusacell launched
new prepaid and postpaid value propositions aimed to position the
Company as the premier service provider in the targeted high-value
market segment. These plans were designed to fit the needs of
high-value consumer segments and are supported by advertising and
marketing campaigns that anchor the effort.

The postpaid value propositions are comprised of the following
plans: a NAFTA plan, in which local calls, as well as calls within
Mexico, the U.S. and Canada, are priced at the same per minute
rate; an unlimited nights and weekends plan designed to increase
mobile traffic and leverage non-peak network hours; a basic plan
with affordable rates designed to compete directly with
competitors' plans by incorporating higher baseline minutes; and
multi-line plans to fit the communication needs of small groups of
users such as families and small and medium sized enterprises. In
addition, the Company offers regional plans, such as, in the
northern regions, where subscribers can purchase a special cross-
border plan with lower priced calls across Mexico, U.S. and
Canada; and in Regions 1, 4 and 8, local plans are available with
competitive per minute pricing. All these plans feature unlimited
Iusacell-to-Iusacell calls to other subscribers on the network for
a fixed monthly fee.

Corporate customers can now contract a flexible combination of the
new service packages at a volume rate, or purchase a large pool of
minutes at a competitive per minute price that can be shared among
all users.

                        Financial Results

Revenue in the quarter decreased slightly from the previous
quarter to $1,140 million. However, revenues decreased 16% from
the year ago period as a result of the lower subscriber base and
lower ARPUs resulting from the change in the subscriber base mix.
The Company believes the newly launched set of service plans
including corporate proposals, as well as, high-value customer
retention programs, will drive high-value sales and revenues in
the third quarter 2003.

Cost of sales in the second quarter of 2003 decreased 30% from the
year ago period, from $481 million to $335 million. Ongoing
headcount initiatives and cost controls enabled the Company to
realize better cost savings despite higher lease costs associated
with the non-strategic towers sold to (and leased-back from) the
Mexican subsidiary of American Tower Corporation.

Operating expenses: sales and advertising expenses in the quarter
declined 22% year over year due primarily to fewer gross
subscriber additions and the net effect of the 2002 IEPS tax
provision cancellation (see Regulatory and Legal Affairs). As a
percentage of revenues, sales and advertising expenses decreased
from 25% to 23%. Lower headcount and expense containment helped
reduce general and administrative expenses to $115 million, an 11%
decline from the previous year's quarter. As a percentage of
revenues, general and administrative expenses remained stable at
10% in the second quarter of 2002 and 2003.

EBITDA margin in the second quarter of 2003 was 37%, higher than
the 34% recorded in the first quarter of this year and the 32%
recorded in the second quarter of 2002, evidencing the early
results of the turn around efforts. On an absolute basis, second
quarter 2003 EBITDA of $425 million increased 6% sequentially, but
decreased only 3% from $437 million recorded in the second quarter
of 2002. 2002 EBITDA included a $35 million gain from non-
strategic tower sales; without this extraordinary item EBITDA
would have improved 6% on a year-over-year basis. Adjusted EBITDA
margin was 29% in the second quarter of 2003, substantially higher
than the 19% margin recorded in the second quarter of last year.

Depreciation and amortization expenses of $615 million in the
second quarter of 2003 increased 5% from the second quarter of
2002, due to higher depreciation expense derived from the
capitalization of recently completed projects.

Postpaid subscriber acquisition costs in the quarter improved from
US$245 last year to US$186 in the most recent quarter, due to
restructured commission plans aimed to support the new value
proposition packages, more efficient handset purchases and
targeted subsidies.

Operating loss in the quarter increased from the $152 million
recorded last year to $191 million in the current quarter driven
by lower revenues and higher depreciation and amortization
expenses partially offset by continued cost controls and headcount
initiatives.

Other income of $46 million was recorded in the second quarter of
2003 as a result of the cancellation of certain tax provisions
derived from a tax provision analysis from prior years as part of
the continuous operations of the Company.

Integral financing result in the quarter ended with a gain of $19
million, compared to a cost of $538 million in the same quarter of
last year. The improvement was mainly driven by a $232 million
foreign exchange gain resulting from the 3% appreciation of the
peso against the U.S. dollar, compared to a 5% peso depreciation
last year. Interest expense increased $12 million in the second
quarter of 2003, compared to the same period of 2002 as a result
of the peso depreciation in the twelve-month period.

Net loss in the quarter of $124 million was the result of lower
integral financing costs. This compares to a net loss of $714
million in the year ago period.

Liquidity: During the second quarter of 2003, the Company funded
its operations, capital expenditures, handset purchases, and
principal and interest payments with internally generated cash
flow. As of June 30, 2003, the Company's operating cash balance
was US$12 million.

Capital expenditures: Iusacell invested approximately US$4 million
in its regions during the second quarter of 2003 to expand
coverage. This capex reflects Iusacell's strategic focus on
maximizing existing capacity and prioritizing investments that
directly benefits the high-value customer base.

Debt: As of June 30, 2003, including trade notes payable and notes
payable to related parties, debt totaled US$811 million, compared
to US$841 million registered in the second quarter of 2002 and
US$815 in the first quarter of 2003. All of the Company's debt is
U.S. dollar-denominated, with an average maturity of 2.4 years. As
of quarter-end, Iusacell's debt-to-capitalization ratio was 64.8%,
versus 56.7% on June 30, 2002.

As a consequence of the events of default (as defined under the
different indentures governing the debt) incurred in the quarter
(see Event of default on 14.25% bonds due 2006 and Technical
default on 10% bonds due 2004), Iusacell reclassified all the
Company's financial debt as current in the Balance Sheet presented
herein, in accordance with Mexican GAAP.

                       Recent Developments

ADS ratio change: As previously reported, the Company obtained
approval to implement a 1 for 10 ADS ratio change at the Ordinary
Shareholders Meeting held on April 21, 2003. The change became
effective on May 12. 2003. Each of Iusacell's American Depositary
Shares now represents one hundred of its ordinary shares, and the
new CUSIP number is 40050B 20 9. Before the ratio change, the
Company's ADS-to-ordinary shares ratio was one-to-ten, and the
CUSIP number was 40050B 10 0. This ratio change did not impacted
holders of the Company's ordinary shares and was effected without
charge to investors.

The main purpose of the ratio change was to comply with the NYSE
rules requiring a minimum 30-day average trading price of US$1.00
per ADS. With the ratio change, the Company has cured the
deficiency and on July 17, 2003, received written confirmation
from the NYSE that Iusacell is no longer considered below the
continued listing criterion.

Strategic shareholders tender shares: On June 13, 2003 the
Company's two largest shareholders, Verizon Communications and
Vodafone Americas BV, announced an agreement to tender all of
their shares, representing 73.9% of the Company's outstanding
shares, in a public tender offer commenced in Mexico and the
United States by Movil Access, S.A. de C.V., (Movil Access) a
Mexican telecommunications service provider, a subsidiary of
Biper, S.A. de C.V., which is part of Grupo Salinas.

After obtaining regulatory approvals, Movil Access launched the
tender offer on June 30, 2003, and withdrawal rights will expire
on July 29, 2003. In the Offering Memorandum, filed with the
Mexican Securities and Banking Commission and the U.S. Securities
and Exchange Commission, Movil Access is offering to purchase all
of the outstanding Series V and Series A shares, including all of
the ADSs representing Series V Shares of Iusacell at a peso price
of $0.057 per share (in the U.S. offer, the equivalent of $5.71
pesos per ADS) in each case in cash, less any withholding taxes.
For more information, please refer to the Offering Memorandum,
filed by Movil Access, on the Mexican Stock Exchange Web site --
http://www.bmv.com.mxand the U.S. Offering Memorandum, on the SEC
Web site -- http://www.sec.gov

Unanimous written consent of the Board of Directors of Iusacell:
In a filing with the Mexican Stock Exchange dated July 14, 2003,
the Board of Directors of Iusacell said there are too many
possible outcomes, both negative and positive for the stock, to be
able to recommend acceptance or rejection of the offer to buy 100%
of the company's shares (see Strategic shareholders tender
shares).

The Board urged shareholders "to take their own decision based on
the information available," while noting that all shareholders are
offered equal treatment under the buyout bid launched June 30. The
Board members said the offer is substantially below market price
prior to the execution of the tender.

The Board said it was not in a position to "reasonably and
responsibly assign a value" to the three options open to other
shareholders: accept the offer, reject the offer and sell the
shares in the market, or reject the offer and remain as a
shareholder. For additional information please consult the form
14D-9 filed by the Company with the SEC on http://www.sec.govand
the filing with the Mexican Stock Exchange on
http://www.bmv.com.mx

Event of default on 14.25% bonds due 2006: Pending an agreement
with the Company's creditors on a restructuring plan, Iusacell did
not make the US$25 million coupon payment due on June 1, 2003 on
its 14.25% bonds due 2006. The 30-day period within which to make
the coupon payment expired on June 30 without payment. As a
result, an event of default occurred under the Indenture governing
the bonds, and the bondholders have the right to declare the
principal of and the accrued interest under the bonds due and
payable or take other legal actions specified in the Indenture, as
they deem appropriate. To date, the bondholders have not taken any
action against the Company, nor have they waived any right to do
so.

Request for a waiver extension under the Credit Agreement: During
the first half of 2003, Grupo Iusacell Celular, S.A. de C.V.,
exceeded the permitted leverage ratio of 2.50 times specified
under the US$266 million Amended and Restated Credit Agreement,
dated as of March 29, 2001.

On April 28, 2003 Iusacell Celular and the lenders entered into a
temporary Amendment and Waiver to the Credit Agreement to increase
the permitted leverage ratio from 2.50 to 2.70 times.

On May 22, 2003, the Amendment was extended until June 13, 2003
and on June 12, 2003, the Amendment was further extended until
June 26, 2003. On June 27, 2003, Iusacell Celular formally
requested an additional extension of the Amendment. On July 10,
2003, the Amendment was extended until August 14, 2003. The
Amendment contains covenants which expire on August 14, 2003 which
restrict Iusacell Celular from making any loans, advances,
dividends, or other payments to the Company and require a
proportionate prepayment of the loan under the Credit Agreement if
it makes any principal or interest payments on any of its
indebtedness for borrowed money, excluding capital and operating
leases. If the Amendment is not further extended, upon its
expiration, Iusacell Celular would be in default of a financial
ratio covenant under the Credit Agreement, which would constitute
an Event of Default (as defined in the Credit Agreement) as if the
Amendment had never become effective.

Technical default on 10.00% bonds due 2004: Pending an agreement
with the Company's creditors on a restructuring plan and as
restricted by the waiver extension under the Credit Agreement,
Iusacell Celular did not make the US$7.5 million coupon payment
due on July 15, 2003 on its 10.00% bonds due 2004. Iusacell
Celular has a 30-day period within which to make the coupon
payment. If Iusacell Celular does not make the payment within the
grace period, an event of default would occur under the Indenture
governing the bonds, and the bondholders would have the right to
declare the principal of and the accrued interest under the bonds
due and payable or take other legal actions specified in the
Indenture, as they deem appropriate.

                  Regulatory and Legal Affairs

Injunction against telecommunications tax upheld: In March 2002,
the Company filed an injunctive action ("amparo") to challenge the
Mexican government's implementation of a new excise tax on certain
wireless telecommunications services approved by the Mexican
Congress. On June 6, 2003, Iusacell was officially notified that
Mexico's Supreme Court affirmed the October 21, 2002 ruling by a
federal district court of Mexico City in favor of Iusacell's
cellular service concessionaires in their amparo filed against the
special telecommunications tax enacted by the Mexican Congress on
January 1, 2002.

                Shareholders Meeting and Resolution

On July 25, 2003, the Company held a general ordinary
shareholder's meeting by which its shareholders elected a new
Board of Directors, which will become effective upon the closing
of the public tender offer of Iusacell's shares lead by Movil
Access. The transaction is expected to close on July 29, 2003.

In addition, the Board of Directors reiterated its intention to
name Mr. Gustavo Guzman as Chief Executive Officer of Iusacell,
Mr. Jose Ignacio Morales Elcoro, Director General of
Administration and Mr. Jose Luis Riera K., Director General of
Finance, all names effective on July 29, 2003.

The following table presents the members of the new Board of
Directors:


Ricardo B. Salinas Pliego           Chairman of the Board and
                                     Series A Director
Pedro Padilla Longoria              Vice Chairman and Series
                                     A Director
Gustavo Guzman Sepulveda            Series A Director
Jose Ignacio Morales Elcoro         Series A Director
Luis Jorge Echarte Fernandez        Series A Director
Federico Bellot Castro              Series A Director
Mariluz Calafell Salgado            Series A Director
Jorge Narvaez Massini               Series V Director
Eduardo Kuri Romo                   Series V Director
Hector Rojas Villanueva             Series V Director
Marcelino Gomez Velasco             Series V Director
Gonzalo Brockman Garcia             Series V Director

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

For additional corporate information please visit the Company's
Web site at http://www.iusacell.com

Grupo Iusacell's June 30, 2003 balance sheet shows that its total
current liabilities outweighed its total current assets by about
$8 billion, while its net capital further shrank to about $4.6
billion.


HAIGHTS CROSS: S&P Drops Corporate Credit Rating a Notch to B
-------------------------------------------------------------
Standard & Poor's Ratings Services lowered its corporate credit
rating for Haights Cross Communications Inc. to 'B' from 'B+'.

At the same time, Standard & Poor's assigned its 'CCC+' rating to
HCC's privately placed, Rule 144A $80 million senior discount
notes due 2013. Haights Cross Operating Co.'s privately placed,
Rule 144A $260 million senior notes due 2011 were rated 'B-', and
the company's $30 million senior secured credit facility due 2008
was rated 'B+'. The ratings outlook is stable. White Plains, New
York-based Haights Cross is a supplemental education publisher.
Pro forma total debt as of March 31, 2003, was $340 million.

Issue proceeds will be used to refinance: HCOC's existing $142.5
million senior secured credit facility; HCC's $71 million of 14%
senior subordinated pay-in-kind notes due 2009; and HCC's $113
million of Series B 16% non-exchangeable senior preferred stock
due 2011. The secured credit facility is rated one notch above the
corporate credit rating, reflecting the very strong likelihood of
full recovery of principal under a default or bankruptcy scenario.

"The downgrade reflects heightened debt leverage and greater cash
interest expense resulting from the refinancing of pay-in-kind
preferred stock with debt, recently soft operating performance,
and an uncertain outlook for near-term EBITDA growth," said
Standard & Poor's credit analyst Hal F. Diamond.

EBITDA (after amortization of prepublication costs and adjusted to
exclude restructuring charges and a nonrecurring management
incentive plan) declined 14% in the first quarter of 2003
reflecting school budgetary constraints and reduced spending for
library publications. Based on preliminary results for the three
months ended June 30, 2003, the company expects EBITDA will
continue to decline versus the prior year period due to the impact
of the sluggish economy on retail audiobook sales, the loss of a
significant distributor in its audiobook rental business, and soft
sales of older titles at its Chelsea House library book publishing
unit, which has been underperfoming since 2000. Management cannot
predict whether these trends will impact its financial performance
for the remainder of the year.

The refinancing transactions increase debt leverage and interest
expense. Pro forma debt to EBITDA increased to about 8.19x from
4.83x for the 12 months ended March 31, 2003. Pro forma EBITDA
coverage of total interest expense for the same period declined to
1.25x from 2.15x. Coverage of pro forma cash interest expense was
1.89x, reflecting the pay-in-kind interest provision of the senior
discount notes.


HAWK CORP: Hosting Second Quarter 2003 Conference Call Today
------------------------------------------------------------
In conjunction with Hawk Corporation's (NYSE: HWK) second quarter
2003 earnings release, you are invited to listen to its conference
call that will be broadcast live over the Internet today at 11:00
a.m. Eastern with the management of Hawk Corporation.

     What: Hawk Corporation Second Quarter 2003 Earnings Release

     When: Tuesday, July 29, 2003 @ 11:00 a.m. Eastern

     Where: http://www.Hawkcorp.comor

     http://www.firstcallevents.com/service/ajwz386134494gf12.html

     How: Live over the Internet - Simply log on to the web at the
          address above Contact: Thomas A. Gilbride, Vice
          President - Finance, 216.861.3553.

If you are unable to participate during the live webcast, the call
will be archived later in the afternoon on the Web site
http://www.Hawkcorp.com To access the call, click on News &
Reports-News-Conference Calls.

Hawk Corporation -- whose Corporate Credit Rating has been upgrade
by Standard & Poor's to 'single-B' -- is a leading worldwide
supplier of highly engineered products. Its friction products
group is a leading supplier of friction materials for brakes,
clutches and transmissions used in airplanes, trucks, construction
equipment, farm equipment and recreational vehicles.  Through its
precision components group, the Company is a leading supplier of
powder metal and metal injected molded components for industrial
applications, including pump, motor and transmission elements,
gears, pistons and anti-lock sensor rings.  The Company's
performance automotive group manufactures clutches and gearboxes
for motorsport applications and performance automotive markets.
The Company's motor group designs and manufactures die-cast
aluminum rotors for fractional and subfractional electric motors
used in appliances, business equipment and HVAC systems.
Headquartered in Cleveland, Ohio, Hawk has approximately 1,700
employees and 16 manufacturing sites in five countries.

Hawk Corporation is online at: http://www.hawkcorp.com


HEADWAY CORPORATE: Disclosure Statement Hearing Set for Aug. 7
--------------------------------------------------------------
On July 1, 2003, Headway Corporate Resources Inc. filed its
Chapter 11 Reorganization Plan together with an accompanying
Disclosure Statement in the U.S. Bankruptcy Court for the Southern
District of New York.

A hearing to consider the adequacy of the Debtor's Disclosure
Statement will convene on August 7, 2003, at 11:30 a.m.  At that
hearing, the Debtor will ask the Court to find that the Disclosure
Statement, pursuant to 11 U.S.C. Sec. 1125, contains the right
kind and amount of information needed by creditors to decide
whether to vote to accept or reject the Plan.

Responses or objections, if any, to the motion must be received by
the Bankruptcy Court on or before 4:00 p.m. on Aug. 1, 2003, and
copies must be served on:

        i.) Counsel for the Debtor
            Weil, Gotshal & Manges LLP
            767 Fifth Avenue
            New York, NY 10153
            Attn: Jeffrey L. Tanenbaum, Esq.

       ii.) United States Trustee for SDNY
            33 Whitehall Street
            21st Floor
            New York, NY 1004
            Attn: Tracy H. Davis, Esq.

      iii.) Counsel for the Agent to Headway's Prepetition Lenders
            O'Melveny & Myers LLP
            30 Rockefeller Plaza
            New York, NY 10022
            Attn: Sandeep Qusba, Esq.

Headway Corporate Resources, Inc., headquartered in New York, New
York, provides human resource and staffing services. The Company
filed for chapter 11 protection on July 1, 2003 (Bankr. S.D.N.Y.
Case No. 03-14270).  Jeffrey L. Tanenbaum, Esq., at Weil, Gotshal
& Manges, LLP, represents the Debtor in its restructuring efforts.
When the Company filed for protection from its creditors, it
listed estimated assets of over $10 million and estimated debts of
more than $50 Million.


HERCULES INC: Shareholders' Committee Terminates Proxy Contest
--------------------------------------------------------------
Samuel J. Heyman, a Hercules Board member, speaking on behalf of
The Hercules Shareholders' Committee for New Management, made the
following statement this morning at the Annual Meeting of
Shareholders of Hercules Incorporated (NYSE: HPC), in Wilmington:

"We are gratified by the widespread support we have received for
what is always an uphill struggle in this sort of endeavor.  Based
upon the preliminary estimate of the vote by our proxy
solicitation firm, Georgeson Shareholder Communications Inc., it
appears that The Hercules Shareholders' Committee for New
Management has received a majority of the votes for two additional
seats on the Hercules Board -- which would give it a total of six
out of thirteen.

"As we said [Thurs]day, Mario Gabelli's 'splitting the baby'
solution -- a split Board with a swing director -- can never be,
as King Solomon demonstrated, the right answer.  We strongly
believe that a deadlocked Board would be detrimental to the
interests of the Company and its shareholders, and our Committee
nominees have authorized me to announce that they intend to step
aside.  As a result, our Committee is hereby withdrawing its
nominees and terminating its proxy challenge.

"Our four existing minority directors, Sunil Kumar, Gloria
Schaffer, Raymond Troubh and myself have decided to step down from
the Board as well, effective immediately.  We do this without the
slightest rancor, but rather because we have a high conviction
that this is the right thing to do not only for ourselves but more
importantly for the Company, its shareholders, and employees.

"This contest has never been about power or personal
aggrandizement, but rather about principle as well as the
opportunity to enhance shareholder value for all Hercules
shareholders.  We believe that at this time Bill Joyce and the
majority directors are entitled to a clear and open field, they
have made promises to shareholders which I know they will work
hard to keep, and we naturally wish Dr. Joyce and the Board all
our best in that regard.

"Finally, we take pride in the changes we were able to help bring
about at the Company, and we have great faith in the potential of
the Company's remaining businesses and the ability of Hercules
employees to help realize that potential.  We salute the majority
directors with whom we did not always agree, and most importantly
I wish to express my deep appreciation to our minority directors
for service above and beyond the call of duty and our four
director-nominees this year for their support in helping us
fighting the good fight."

                         *    *    *

As previously reported in Troubled Company Reporter, Standard &
Poor's assigned its 'BB' bank loan rating to Hercules Inc.'s $350
million senior secured credit facilities.

Standard & Poor's also affirmed its 'BB' corporate credit rating
on the company. The outlook remains positive.


INFOUSA INC: S&P Places Lower-B Ratings on CreditWatch Positive
---------------------------------------------------------------
Standard & Poor's Ratings Services placed its 'BB-' corporate
credit and 'B' subordinated debt ratings for infoUSA Inc. on
CreditWatch with positive implications. The Omaha, Nebraska-
headquartered company is a provider of business and consumer
information, data processing, and database marketing services.
About $170 million of debt is outstanding.

"The CreditWatch placement reflects infoUSA's stronger financial
profile," said Standard & Poor's credit analyst Donald Wong.
Despite a very challenging operating climate, the company has
generated significant levels of free operating cash flow during
the past two years. These funds have been used primarily for debt
reduction. In addition, infoUSA has refinanced a significant
portion of its 9.5% subordinated notes with lower-cost credit
facilities. Adjusted for operating leases, debt to EBITDA is in
the low-2x area and EBITDA to interest is in the mid-5x area.

Standard & Poor's will review the ratings on infoUSA after
evaluating the company's future operating and financial
strategies. If the ratings are raised, the corporate credit rating
ceiling is 'BB'.


INTERNATIONAL PAPER: Declares Regular Quarterly Dividend
--------------------------------------------------------
International Paper (NYSE: IP) announced a regular quarterly
dividend of $0.25 per share for the period of July 1, 2003, to
Sept. 30, 2003, inclusive.  The dividend on the common stock of
the company is payable on Sept. 15, 2003, to holders of record at
the close of business on Aug. 21, 2003.

The company also declared a regular quarterly dividend of $1 per
share for the period of July 1, 2003, to Sept. 30, 2003,
inclusive, on the preferred stock of the company, payable on
Sept. 15, 2003, to holders of record at the close of business on
Aug. 21, 2003.

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

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


INVESCO CBO: Fitch Affirms BB- Rating on Class B-2 Notes
--------------------------------------------------------
Standard & Poor's Ratings Services affirmed its 'BB-'rating on the
class B-2 notes issued by Invesco CBO 2000-1 Ltd., managed by
Invesco Inc, and removed it from CreditWatch with negative
implications, where it was placed April 24, 2003. In addition, the
ratings on the class A-1L, A-2L, A-3, and B-1L notes are affirmed.

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

The overcollateralization test ratios for Invesco CBO 2000-1 Ltd.
remain in compliance and have improved since the April CreditWatch
placement. As of the July 2, 2003 monthly trustee report, the
class A overcollateralization ratio was 124.00% (the minimum
required ratio is 118.00%), versus a ratio of 121.90% in April.
The class B-1L overcollateralization ratio was 110.50% (the
minimum required ratio is 109.00%), versus a ratio of 108.70% in
April. The class B-2 overcollateralization ratio was 105.60% (the
minimum required ratio is 103.00%), versus a ratio of 103.90% in
April.

Standard & Poor's notes that according to the July trustee report,
the transaction is back in compliance with regard to Standard &
Poor's Trading Model Test. The Trading Model Test is a measure of
the overall credit quality within the portfolio and its ability to
support the ratings initially assigned to the liability tranches
issued by the CDO.

Standard & Poor's has reviewed the current cash flow runs
generated for Invesco CBO 2000-1 Ltd. to determine future defaults
the transaction can withstand under various stressed default
timing scenarios while still paying all of the rated interest and
principal due on the rated notes. Upon comparing the results of
these cash flow runs with the projected default performance of the
current collateral pool, Standard & Poor's has determined that the
ratings assigned are consistent with the credit enhancement
currently available. Standard & Poor's will continue to monitor
the performance of the transaction to ensure that the ratings
assigned remain consistent with the credit enhancement available.

       RATING AFFIRMED AND REMOVED FROM CREDITWATCH NEGATIVE

                      Invesco CBO 2000-1 Ltd.

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

                         RATINGS AFFIRMED

                      Invesco CBO 2000-1 Ltd.

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


IT GROUP: Removal Period Extension Hearing to Convene on Monday
---------------------------------------------------------------
The IT Group, Inc., and its debtor-affiliates continue to remain
parties to over 100 different judicial and administrative
proceedings currently in various courts or administrative agencies
throughout the country. Because of the number of Actions involved
and the wide variety of claims, Gregg M. Galardi, Esq., at
Skadden, Arps, Slate, Meagher & Flom LLP, in Wilmington, Delaware,
informs Judge Walrath that the Debtors need additional time to
determine which of the Actions should be removed and, if
appropriate, transferred to the District Court.

The Debtors ask the Court to further extend their Removal Period
with respect to any actions pending on the Petition Date through
the earlier of:

    (a) October 10, 2003; or

    (b) 30 days after the entry of any particular action sought to
        be removed.

Mr. Galardi explains that the extension will afford the Debtors a
sufficient opportunity to make fully informed decisions concerning
the possible removal of Actions, protecting their valuable right
to economically adjudicate lawsuits if the circumstances warrant
removal.

Judge Walrath will convene a hearing on August 4, 2003 at 2:00
p.m. to consider the Debtors' request.  By application of Delaware
Local Rule 9006-2, the Debtors' Removal Period is automatically
extended until the conclusion of that hearing. (IT Group
Bankruptcy News, Issue No. 30; Bankruptcy Creditors' Service,
Inc., 609/392-0900)


KMART: Sues Philip Morris for $8 Million Compensatory Damages
-------------------------------------------------------------
Kmart Corporation and its debtor-affiliates accuse Philip Morris
USA Inc. of breach of contract and willful violation of the
automatic stay imposed on their Chapter 11 cases for refusing to
make reimbursement payments as required under a prepetition supply
agreement.  The Debtors seek $8,000,000 in compensatory damages
plus additional amounts that they may incur during the course of
their action.

Philip Morris provides the Debtors with tobacco products. Pursuant
to an August 7, 2001 agreement, Philip Morris agreed to reimburse
the Debtors for the expenses in installing retail fixtures in
Kmart stores for the sale of cigarettes.  Since the execution of
the Agreement, the Debtors have installed 10,043 cigarette racks.
However, Philip Morris has not reimbursed the Debtors for any
invoices it has received for the purchase and installation of the
cigarette racks.

In a letter in January 2003, the Debtors demanded that Philip
Morris honor its commitments under the Agreement by reimbursing
$8,000,000.  But Philip Morris demanded for additional
verification of the installation costs.  Although the demand
requested documents outside the Agreement's scope, the Debtors
complied with the request.  But despite the Debtors' good faith
conduct in complying with the verification request, Philip Morris
continues to refuse to make any reimbursements.

The Debtors assert that the reimbursement payments due under the
Agreement are debts that are property of the bankruptcy estate
which have matured pursuant to the Agreement's terms.  The
reimbursement payments are payable on order or demand.  The
payments are not subject to the right of set-off under Section
553 of the Bankruptcy Code.  Therefore, the Debtors are entitled
to judgment directing Philip Morris to turnover the unpaid
reimbursement payments.

The Debtors maintain that their contractual right to payments
constitutes a property of the estates.  Section 541(a)(1) of the
Bankruptcy Code defines property as "all legal and equitable
interests of the debtor in property as of the commencement of the
case."  Accordingly, Philip Morris' non-payment is an act to
obtain possession of or exercise control over the estates'
property.

Philip Morris' refusal to pay the amounts due without Court
approval for its actions also violates the automatic stay.

                      Philip Morris Answers

Philip Morris USA Inc. denies having violated the automatic stay.
Philip Morris tells Judge Sonderby that Count 2 -- Declaratory
Judgment Pursuant to 11 U.S.C. Section 105 and 28 U.S.C. Sections
2201-2202, and Count 3 -- Violation of 11 U.S.C. 362 of the
Debtors' complaint fail to state any claim on which relief may be
granted.  Thus, these Counts should be denied. (Kmart Bankruptcy
News, Issue No. 60; Bankruptcy Creditors' Service, Inc., 609/392-
0900)


LA QUINTA: Will Publish Second Quarter 2003 Results on Thursday
---------------------------------------------------------------
La Quinta Corporation (NYSE: LQI) will report second quarter
financial results prior to the open of the market on Thursday,
July 31, 2003.

At 11:00 AM (EDT) on Thursday, July 31, 2003, La Quinta will hold
a conference call and audio webcast to discuss its financial
results and business outlook.  La Quinta may answer one or more
questions concerning business and financial matters affecting the
Company, which may contain or constitute information that has not
been previously disclosed.

Simultaneous with the conference call, an audio webcast of the
call will be available via a link on the La Quinta Web site,
http://www.LQ.com, in the Investor Relations-Webcasts section.
The conference call can be accessed by dialing 800-240-2430
(International: 212-329-1456).  An access code is not required.
A replay of the call will be available from 1:00 PM (EDT) on
July 31, 2003 through 1:00 PM (EDT) on August 7, 2003 by dialing
800-405-2236 (International: 303-590-3000) and entering the access
code of 546326.  The replay will also be available in the Investor
Relations-Webcasts section of the La Quinta Web site,
http://www.LQ.com

Dallas-based La Quinta Corporation, a leading limited service
lodging company, owns, operates or franchises over 350 La Quinta
Inns and La Quinta Inn & Suites in 33 states.  More information
about La Quinta, is available on the Internet at http://www.LQ.com

As reported in Troubled Company Reporter's March 13, 2003
edition, Fitch Ratings assigned a rating of 'BB-' to the $250
million senior unsecured notes due 2011 being issued by La
Quinta. The Rating Outlook is Negative.

The ratings reflect La Quinta's sizable and geographically
diverse asset base of owned hotel properties, healthy liquidity,
improved balance sheet, experienced management team, and track
record in a challenging environment. Risks include the very weak
lodging environment, the resulting pressures on credit
statistics and marginal free cash generation, required access to
external capital over the intermediate term and significant
competition in its sector that includes companies with far
greater resources.

The Negative Rating Outlook reflects the weak lodging fundamentals
that have disproportionately affected LQI's results due to (i)
LQI's significant exposure to underperforming markets and (ii)
downward pricing pressure and lower occupancy at limited service
hotels as full service hotels scale back pricing.


LEAR CORP: Names Daniel A. Ninivaggi as VP and General Counsel
--------------------------------------------------------------
Lear Corporation (NYSE: LEA) has appointed Daniel A. Ninivaggi to
vice president, secretary and general counsel, effective
immediately.  He will report to Lear Vice Chairman, James H.
Vandenberghe.

Ninivaggi joins Lear following an 11-year career with Winston and
Strawn, where he had been partner in the law firm's New York
office specializing in corporate finance, securities law and
mergers and acquisitions since 1998.

"We are very pleased to have Dan join the Lear team," said
Vandenberghe. "He brings a wealth of experience in the areas of
securities law and corporate governance as well as strong business
acumen, and will be a welcome addition to our company."

Ninivaggi received a bachelor of arts degree from Columbia
University; a masters in business administration degree from the
University of Chicago Graduate School of Business; and a juris
doctorate degree from Stanford Law School.

Lear Corporation (S&P/BB+/Positive), a Fortune 500 company
headquartered in Southfield, Mich., USA, focuses on integrating
complete automotive interiors, including seat systems, interior
trim and electrical systems.  With annual net sales of $14.4
billion in 2002, Lear is the world's largest automotive interior
systems supplier.  The company's world-class products are
designed, engineered and manufactured by 115,000 employees in more
than 280 facilities located in 33 countries.  Additional
information about Lear and its products is available on the
Internet at http://www.lear.com

The Company's December 31, 2002 balance sheet shows that total
current liabilities exceeded total current assets by about $538
million.


LORAL SPACE: Taps Weil Gotshal for Chapter 11 Legal Services
------------------------------------------------------------
Loral Space & Communications Ltd., and its debtor-affiliates want
to employ Weil, Gotshal & Manges, LLP as their attorneys in these
chapter 11 cases.

The Debtors tell the U.S. Bankruptcy Court for the Southern
District of New York that Weil Gotshal is intimately familiar of
the Company's businesses and affairs because it assisted and
advised prior to the Petition Date with respect to formulating,
evaluating, and implementing various restructuring,
reorganization, and other strategic alternatives.

In this retention, that Debtors want Weil Gotshal to:

     a. take all necessary or appropriate actions to protect and
        preserve the Debtors' estates, including the prosecution
        of actions on the Debtors' behalf, the defense of any
        actions commenced against the Debtors, the negotiation
        of disputes in which the Debtors are involved, and the
        preparation of objections to claims filed against the
        Debtors' estates;

     b. prepare on behalf of the Debtors, as debtors in
        possession, all necessary or appropriate motions,
        applications, answers, orders, reports and other papers
        in connection with the administration of the Debtors'
        estates;

     c. take all necessary or appropriate actions in connection
        with a plan or plans of reorganization and related
        disclosure statement(s) and all related documents, and
        such further actions as may be required in connection
        with the administration of the Debtors' estates; and

     d. perform all other necessary or appropriate legal
        services in connection with these chapter 11 cases.

Stephen Karotkin, Esq., a member of Weil Gotshal, reports that the
Firm's current customary hourly rates are:

          members and counsel            $375 to $725 per hour
          associates                     $200 to $440 per hour
          paraprofessionals and staff    $50 to $175 per hour

Loral Space & Communications Ltd., headquartered in New York, New
York, and together with its affiliates, is one of the world's
leading satellite communications companies with substantial
activities in satellite-based communications services and
satellite manufacturing. The Company filed for chapter 11
protection on July 15, 2003 (Bankr. S.D.N.Y. Case No. 03-41710).
Stephen Karotkin, Esq., and Lori R. Fife, Esq., at Weil, Gotshal &
Manges LLP, represent the Debtors in their restructuring efforts.
When the Debtors filed for protection from its creditors, it
listed $2,654,000,000 in total assets and $3,061,000,000 in total
debts.


LTV: Court Okays McDermott Will as Copperweld's Labor Counsel
-------------------------------------------------------------
Copperweld Corporation obtained Judge Bodoh's permission to Hire
McDermott Will & Emery as special labor counsel, nunc pro
tunc to May 28, 2003.

MWE was employed by Copperweld on May 28, 2003, to provide legal
advice and representation with respect to labor, employment and
employee benefit issues, including negotiations with the United
Steelworkers of America and the Pension Benefit Guaranty
Corporation regarding pension issues. (LTV Bankruptcy News, Issue
No. 51; Bankruptcy Creditors' Service, Inc., 609/392-00900)


LYONDELL CHEM: S&P Lowers Ratings over Weak 2nd Quarter Results
---------------------------------------------------------------
Standard & Poor's Ratings Services lowered its corporate credit
rating on Houston, Texas-based Lyondell Chemical Co. to 'BB-' from
'BB'.

Standard & Poor's said that it also lowered its corporate credit
rating on Lyondell's 70.5%-owned subsidiary, Equistar Chemicals
L.P. to 'BB-' from 'BB' The current outlook on both companies is
negative.

Standard & Poor's said that the downgrades follow Lyondell's
announcement of disappointing second-quarter operating results and
diminishing prospects for a meaningful recovery in the
petrochemical sector this year. "The modest downgrade reflects the
increasing likelihood that operating conditions will delay the
improvement of the financial profile factored into the previous
ratings, but recognizes the prudent steps taken by management to
extend debt maturities and to preserve liquidity in a difficult
business environment," said Standard & Poor's credit analyst
Kyle Loughlin. "The absence of tangible improvement to measures of
financial strength also heightens credit exposure to adverse
developments in a still-uncertain business environment,
particularly given the risk of additional covenant violations, raw
material price increases, or potential disruptions at the
company's LYONDELL-CITGO Refining L.P. unit due to ongoing
political instability in Venezuela," added the analyst.

Standard & Poor's said that its ratings on Lyondell reflect high
debt levels stemming from the 1998 acquisition of ARCO Chemical
Co., which continue to overshadow the firm's average business
profile as a leading North American petrochemical producer.
Lyondell Chemical is the world's largest producer of propylene
oxide, a key intermediate for urethanes, and an array of
industrial chemicals. That solid market position is bolstered by
large-scale and cost-efficient operating facilities.


LYRTECH INC: Inks Debt Restructuring Pact via Debt Conversion
-------------------------------------------------------------
Lyrtech inc. (TSX Venture: LYT), worldwide expert in digital
signal processing development solutions, announced that the new
management team has signed agreements of debt settlement by
issuance of shares. This debt conversion amounts to $784,336.

Lyrtech will issue a total of 6,322,557 shares at prices ranging
between $0.11 and $0.15 to seven creditors and/or shareholders.
This debt settlement allows the corporation to considerably reduce
its debt and have a significant increase in its shareholder value.
This also positions the corporation in a much stronger financial
situation.

It must be noted that Lyrtech had the opportunity to convert the
debt contracted with the investor that was announced on January 7,
2003. This debt, a $500,000 convertible promissory note with an
annual interest rate of 15% had an established conversion price of
$0.11.

"The set up of a restructuring plan at Lyrtech has been possible
rapidly with the support of all parties involved", stated the
president and CEO of Lyrtech, Miguel Caron. "Without the creditors
and investors' support in converting their debt into shares, the
amount of debt would have slowed down Lyrtech in its development.
With an important financial support, Lyrtech will be able to
better position itself and set up a long term development plan."

With the restructuring ongoing for several months, Lyrtech is
getting closer to its continuous profitability goal. "To reach
profitability is the main objective of the new management team",
stated Miguel Caron. "With the encouraging results encountered
over the last two months, it is with impatience that we await the
financial results for the next quarters of financial 2003."

"Lyrtech is a highly experienced corporation that worked in many
parts of the world with some of the most prestigious corporations
of the electronics industry", added Mr. Caron. "The objective is
now to capitalize on the 20 years of experience and leverage
sales, which will be done by increasing the sales force. This
important step will be done in the short term. Already, the team
added a senior sales manager for California, a team of
representatives in the East-Coast of the United States and
distributors in Vietnam and South Korea. Discussions also involve
adding valuable teammates in other parts of the United States, in
Canada and Europe."

Lyrtech's issue of shares for debt consolidation is subject to the
approval of the securities commissions.

Lyrtech inc. occupies an important place in the worldwide digital
signal processing technology market. These technologies are
central to network and wireless telecommunications, audio and
video processing and the electronics of defense and aerospace
systems. Lyrtech inc. has established partnerships with industry
leaders in the field such as Texas Instruments, Xilinx, The
MathWorks, Analog Devices and Infineon Technologies. The
corporation also has prestigious customers such as Nokia, Nortel,
Fujitsu, Mitshubishi, GM, Toyota, Honda, BAE Systems, EADS and
others.

Lyrtech inc. -- http://www.lyrtech.com-- is a public corporation
whose shares are listed on the TSX Venture Exchange under the
ticker abbreviation LYT. Lyrtech exports to more than twenty
countries.


MEOW MIX: S&P Places BB- Credit & Debt Ratings on Watch Negative
----------------------------------------------------------------
Standard & Poor's Ratings Services placed its 'BB-' corporate
credit and senior secured debt ratings for cat food company, The
Meow Mix Co. on CreditWatch with negative implications.

About $84 million of debt is affected.

The CreditWatch listing follows the expected sale of Meow Mix to
Cypress Group LLC, a New York based private equity firm. "The
CreditWatch listing reflects Standard & Poor's expectation that
the company will likely be highly leveraged and that the proposed
transaction could result in a weaker financial profile," said
Standard & Poor's credit analyst Jean C. Stout. "While terms of
the transaction were not as yet disclosed, given the change of
control provisions within Meow Mix's credit agreement, Standard &
Poor's expects that the company will have to refinance its
existing credit facility."

Standard & Poor's will review the proposed transaction and its
impact on the company's credit quality before taking further
rating action. Secaucus, New Jersey-based Meow Mix holds a leading
position in the premium category of the U.S. dry cat food market.


MIRANT: Court Approves Notice Protocol for Securities Trading
-------------------------------------------------------------
Mirant announced that the U.S. Bankruptcy Court has approved an
interim procedure requiring large-block stockholders, bondholders
or other creditors of Mirant Corporation or its debtor
subsidiaries including Mirant Americas Generation and Mirant Mid-
Atlantic, to provide Mirant ten days advance notice of their
intent to buy or sell certain claims against the Debtors, or
shares of Mirant Corporation.

The notice procedure is limited to only those transactions with a
person or entity owning (or, because of the transaction, resulting
in ownership of) an aggregate amount of claims equal to or in
excess of $250 million, and, with respect to shares, only a person
or entity owning (or, because of the transaction, resulting in
ownership of) 4.75 percent or more of any class of outstanding
shares.

In addition, each entity or person that owns at least $250 million
of claims or certain preferred securities must, within 15 days of
the entry of the order, provide the Debtors with notice of
ownership information.

The Court's order also provides for expedited procedures to impose
sanctions for a violation of the order. Sanctions could include
monetary damages and voiding any transactions that violate the
order. A hearing to consider a final order regarding the notice
procedure has been set for 9:00 a.m. CDT on August 8.

As previously disclosed, the order was requested to prevent
potential trades of claims or stock that could negatively impact
the Debtors' net operating loss tax attributes.

Mirant's current tax loss attributes are estimated at
approximately $1 billion and could reach $2.5 billion by the end
of 2003. These attributes could 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

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: Wants Blessing to Continue Intercompany Asset Transfers
---------------------------------------------------------------
Prior to the Petition Date, Mirant and its debtor-affiliates
engaged in intercompany financial transactions in the ordinary
course of their businesses.  Cash transfers to and from
appropriate Bank Accounts were made on account of the Intercompany
Transactions.

According to Robin Phelan, Esq., at Haynes and Boone, LLP, in
Dallas, Texas, the Intercompany Transfers typically included
payments for the funding, if necessary, of the Debtors' working
capital requirements, as well as reimbursement to Mirant Americas
Energy Marketing, LP and Mirant Services, LLC of the costs
relating to administrative and operational services.  All of
these transfers are made between and among the Debtors in the
ordinary course of the Debtors' businesses as part of their
consolidated Cash Management System.  If the Intercompany
Transactions were to be discontinued, the Cash Management System
and related administrative controls would be disrupted to the
detriment of the Debtors.

Mr. Phelan also points out that at any given time, there may be
balances due and owing from one Debtor to another Debtor and
between certain Debtors.  These balances represent extensions of
intercompany credit made in the ordinary course of business that
are an essential component of the Cash Management System.  The
Debtors maintain records of these transfers of cash and can
ascertain, trace and account for these intercompany transactions.
Moreover, the Debtors will continue to maintain these records.

Because the Debtors engage in Intercompany Transactions on a
regular basis and the transactions are common among enterprises
like that of the Debtors, the Debtors believe that the
Intercompany Transactions are ordinary course transactions within
the meaning of Section 363(c)(1) of the Bankruptcy Code and,
thus, do not require the Court's approval.  Nonetheless, the
Debtors sought and obtained the Court's authority to engage in
these transactions on a postpetition basis. (Mirant Bankruptcy
News, Issue No. 2; Bankruptcy Creditors' Service, Inc., 609/392-
0900)


MORGAN STANLEY: S&P Assigns Low-B Rating to Class D Notes
---------------------------------------------------------
Standard & Poor's Ratings Services assigned its ratings to Morgan
Stanley Auto Loan Trust 2003-HB1's asset-backed notes.

The rating on the class A notes reflects 5.75%% subordination and
an overcollateralization target amount of 11.8% of the current
pool balance. The rating on the class B notes reflects 2.5%
subordination and an overcollateralization target amount of 7.5%.
The rating on the class C notes reflects 0.75% subordination and
an overcollateralization target amount of 5.5%. The rating on the
class D notes is based on an overcollateralization target amount
of 2.0% of the current pool balance with a floor of 1.0% of the
initial pool balance and annual excess spread of approximately
4.0%. In addition, the ratings on the notes are based on the
credit quality of the underlying pool of automobile loans
originated by Huntington National Bank, which will continue to
service the loans, and a sound legal structure.

This transaction incorporates a number of structural features. It
is a premium proceeds transaction with total rated securities of
$561.813 million exceeding the initial pool balance of $553.7
million. This undercollateralization is eliminated through the
application of excess spread to reduce the principal balance of
the notes. The payment waterfall begins as a sequential payment
structure. The payment structure may begin to make pro rata
principal distributions if certain target overcollateralization
amounts are achieved. The payment structure also allows for the
reprioritization of subordinate interest to pay senior principal
as additional loss coverage for senior classes. In addition, there
are loan performance triggers built into the structure that cause
the payment priority to switch back to sequential from pro rata if
loan performance deteriorates beyond certain levels.

                        RATINGS ASSIGNED
            Morgan Stanley Auto Loan Trust 2003-HB1

        Class                  Rating       Amount (mil. $)
        A-1                    AAA                  408.175
        A-2                    AAA                  113.714
        B                      A                     17.996
        C                      BBB                    9.690
        D                      BB                    12.238


MOTIENT CORP: Morgens Waterfall Discloses 5.8% Equity Stake
-----------------------------------------------------------
Morgens, Waterfall, Vintiadis & Co., Inc. beneficially own
1,443,666 shares of the common stock of Motient Corporation,
representing 5.8% of the outstanding common stock of Motient.  The
firm has sole powers of voting and disposition of the stock. MWV &
Co., is an investment adviser holding stock for the accounts of
its investment advisory clients.  According to MWV & Co. there is
no agreement or understanding among such clients to act together
for the purpose of acquiring, holding, voting or disposing of any
such securities.  Each such client has the right to receive, or
the power to direct, the receipt of dividends from, or the
proceeds from the sale of, the securities held in such person's
account. No such client has any of the foregoing rights with
respect to more than five percent of the class of securities.

Motient owns and operates an integrated terrestrial/satellite
network and provides a wide range of two-way mobile and Internet
communications services principally to business-to-business
customers and enterprises. Motient serves a variety of markets
including mobile professionals, telemetry, transportation, field
service, and nationwide voice dispatch offering coverage to all 50
states, Puerto Rico, the U.S. Virgin Islands, and thousands of
miles of U. S. coastal waters.

                        *   *   *

As disclosed in previous reports, Motient Corporation has
focused its efforts in recent periods on reducing operating
expenses in order to preserve cash. As of September 30, 2002,
the Company had approximately $3.6 million of cash on hand and
short-term investments. The Company has taken a number of steps
to reduce operating expenses, and is continuing to pursue a
variety of measures to further reduce and/or defer or
restructure operating expenses. It has also been pursuing
funding alternatives.


MSX INT'L: Caps Price of Private Senior Secured Debt Offering
-------------------------------------------------------------
MSX International has priced a private offering of senior secured
notes.  The company and a wholly-owned, indirect subsidiary based
in the United Kingdom will issue various notes totaling $100.5
million in the aggregate.  The notes, which yield an average
11.31% interest, are due October 15, 2007.

MSXI intends to use the net proceeds from the note offering to
repay existing bank indebtedness that matures from December 2004
through December 2006.  In connection with the offering, MSX
International plans to enter into a new $40,000,000 revolving
credit facility with a group of lenders.  The notes will be
guaranteed by certain of MSX International's subsidiaries and
will be secured by substantially all of MSX International's assets
and the assets of the guarantors, subject to liens securing MSX
International's new senior credit facility.

MSX International expects to offer the notes in reliance upon an
exemption from registration under the Securities Act of 1933 for
an offer and sale of securities that does not involve a public
offering.  The various notes involved will not be registered under
the Securities Act of 1933 and therefore may not be offered or
sold in the United States without registration or an applicable
exemption from the registration requirements of the Securities Act
of 1933 and applicable state securities laws.

MSX International, headquartered in Southfield, Mich., is a global
provider of technical business services.  The company combines
innovative people, standardized processes and today's technologies
to deliver a collaborative, competitive advantage.  MSX
International has over 7,000 employees in 25 countries.  Visit
their Web site at http://www.msxi.com

As reported in Troubled Company Reporter's July 9, 2003 edition,
Standard & Poor's Ratings Services assigned its 'B' rating to
MSX's proposed offering of $100 million senior secured notes, with
a second lien, due in 2007 (144A with registration rights). The
proceeds from the notes offering will be used to significantly
reduce commitment levels under MSX's senior credit facilities. In
addition, Standard & Poor's affirmed its 'B+' corporate credit
rating on MSX and its 'B-' rating on the subordinate debt. The
'B+' rating on MSX's senior secured credit facility was withdrawn.

The proposed $100 million senior secured notes, when issued, will
be senior to the company's existing and future subordinated notes
and pari passu with MSX's senior debt, including the senior
secured credit facility. Standard & Poor's rating on the senior
secured notes incorporates the fact that the noteholders will have
a second lien on the company's U.S. assets.


MUTUAL RISK: Completes Scheme of Arrangement with Creditors
-----------------------------------------------------------
Mutual Risk Management Ltd., announced that the Scheme of
Arrangement with its creditors had been declared effective.

As has been previously announced, the Scheme restructures MRM's
senior debt. The principal amount of the debt is $198 million,
comprised of approximately $110 million owing under the Company's
credit facility and $88 million owing to holders of the Company's
9-3/8% debentures. Under the Scheme, the senior debt holders have
exchanged their existing debt for preferred stock and warrants to
purchase 15% of the common stock of MRM on a fully diluted basis
as well as debt, preferred stock and 80% of the common stock of
the MRM's subsidiary, IAS Park Ltd.  IAS Park holds MRM's captive
management and insurance brokerage operations.

As a result of the restructuring, the MRM's remaining principal
assets are 20% of the common shares of IAS Park and all of the
common stock of its U.S. insurance companies. These common shares
in IAS Park are subordinate to the debt and preferred stock of IAS
Park and are unlikely to provide value to the common shareholders
of MRM. The likelihood of the realization of value from MRM's
investment in its US insurance companies is also very remote, as
such companies will almost certainly be liquidated in the near
future.

As reported in Troubled Company Reporter's May 7, 2003 edition,
Fitch Ratings downgraded Mutual Risk Management Ltd.'s
long-term issuer rating, which provides an indication of MRM's
credit quality at a senior unsecured level, to 'D' from 'C'. Fitch
also downgraded the rating of MRM's convertible exchangeable
subordinated debt to 'D' from 'C'.

The rating actions followed creditor and judicial approval of
MRM's plan to restructure its senior debt. Fitch Ratings
considered the restructuring to be a distressed debt exchange
since the alternative to the restructuring would have been
liquidation.


NATIONAL CENTURY: Signs-Up Long & Foster as Real Estate Brokers
---------------------------------------------------------------
National Century Financial Enterprises, Inc., and its debtor-
affiliates seek Judge Calhoun's permission to employ The Long &
Foster Companies as real estate brokers to sell their interests
in three Washington residences, pursuant to Section 327 of the
Bankruptcy Code.

Matthew A. Kairis, Esq., at Jones, Day, Reavis & Pogue, in
Columbus, Ohio, informs the Court that Long & Foster is the
largest residential real estate broker in the Metropolitan
Washington, D.C. area.  In the past two years, Long & Foster has
sold almost 200,000 properties for consideration in excess of
$22,000,000.  Dawn K. Nichols, the real estate broker responsible
for marketing the Residences, sold 48 houses last year
aggregating $11,000,000.

Long & Foster will assist the Debtors in all aspects of the
marketing and sale of the Residences.  In fact, Long & Foster
already has identified potential bidders for the Residences and
negotiated the terms of three contracts to sell the Residences.

The Debtors have previously retained Ruscilli Real Estate
Services, Inc. to assist with the sale of their Dublin
headquarters complex.  However, Mr. Kairis explains, Ruscilli
does not provide residential real estate brokerage services in
the Washington, D.C. area.  Therefore, the Debtors require Long &
Foster's services in these cases.  The Debtors do not anticipate
that there will be any overlap between the services provided by
Ruscilli and Long & Foster.

Dawn K. Nichols, a Long & Foster broker, discloses that neither
Long & Foster nor any of its owners and employees holds any
interest adverse to the Debtors or their estates in the matters
for which they are to be retained.  Accordingly, Ms. Nichols
believes that Long & Foster is a disinterested person, as defined
in Section 101(14) of the Bankruptcy Code.

Because the Debtors are a large enterprise, Long & Foster is
unable to state with certainty that every client representation
has been disclosed.  In this regard, Long & Foster will file a
supplemental disclosure with the Court if it finds additional
information that requires disclosure.

The Debtors further propose that any commissions be paid to Long
& Foster at the time of closing of the applicable transaction.
Under the Engagement Letter, Long & Foster will receive a 5%
commission of the sale price of the Residences.

Mr. Kairis maintains that the Fee Structure is fair and
reasonable and should be approved under Section 328(a) of the
Bankruptcy Code.  The Fee Structure is commensurate with the
nature of the services to be provided by Long & Foster and, in
fact, reflects a lower commission rate than that agreed to in
most residential real estate transactions.

Thus, the Debtors ask the Court to:

    (a) authorize them to employ Long & Foster as real estate
        brokers in these Chapter 11 cases, pursuant to Section
        327 of the Bankruptcy Code, on the terms and conditions
        set forth and in the Engagement Letter; and

    (b) approve the Fee Structure. (National Century Bankruptcy
        News, Issue No. 20; Bankruptcy Creditors' Service, Inc.,
        609/392-0900)


NOBEL LEARNING: Brings-In George H. Bernstein as New Company CEO
----------------------------------------------------------------
The Board of Directors of Nobel Learning Communities, Inc.
(Nasdaq: NLCI), a leading for-profit provider of education and
school management services for the pre-elementary through 12th
grade market, announced the hiring of George H. Bernstein as Chief
Executive Officer.  Mr. Bernstein is also being named to serve on
the Company's Board of Directors.

Bernstein's appointment culminates an extensive national search
for a CEO following the announcement by A.J. Clegg in April of his
intention to resign. A search committee of four members of the
Company's Board of Directors, with the aid of DHR International, a
nationally recognized executive search consultant, was formed to
guide the process.

Added committee member Peter Havens, "The search committee engaged
in a deep and broad process to find the best candidate to lead
NLCI.  George Bernstein rose through that process, and the Board
of Directors has enormous confidence in his abilities."

Mr. Bernstein will take over the leadership of Nobel Learning
Communities, Inc. after a successful career with retail and
professional services companies.  Most recently, Mr. Bernstein was
President of Pearle Vision, Inc. an 840 unit operator and
franchiser of optical retail stores.  At Pearle, Mr. Bernstein led
a turnaround that moved Pearle Vision from a significant period of
negative comparable store sales to positive comparable store sales
and improved profitability in each year of his tenure.

Prior to his experience at Pearle Vision, Mr. Bernstein was the
Senior Vice President and General Manager at Things Remembered, an
800 store chain of personalized gift stores, and President and CEO
of AVC/NuVision, a 170 store optical retailer and vision care
company.  Mr. Bernstein started his business career as a
consultant with Bain and Company, a leading strategy consulting
firm.  During his 17 year career, Mr. Bernstein has held several
positions that give him a strong background in strategic planning,
marketing, driving revenue, leading professional services
organizations and improving company profitability.

Mr. Bernstein commented, "I am thrilled to be part of the Nobel
Learning Communities organization and build upon the strong
foundation developed by its management and leadership.  I look
forward to helping Nobel Learning Communities develop the most
profitable business models in the growing education industry."

Mr. Bernstein has a BS in Business Administration from Bucknell
University and a JD degree from Harvard Law School.  He and his
family will be relocating to the West Chester area from Hudson,
Ohio.

Nobel Learning Communities, Inc. operates 178 schools in 15 states
consisting of private schools and charter schools; pre-elementary,
elementary, middle, specialty high schools and schools for
learning challenged children clustered within established regional
learning communities.

As reported in Troubled Company Reporter's June 12, 2003 edition,
Nobel Learning Communities closed the senior debt refunding with
Fleet and Commerce Bank.

Jack Clegg, Chairman/CEO, stated that NLCI and their banks (Fleet
Bank and Commerce Bank) finalized the transaction to waive any
past covenant defaults and to reset the covenants based on the
current level of financial performance and expected future
performance.


OMEGA HEALTHCARE: Second Quarter Results Enter Positive Zone
------------------------------------------------------------
Omega Healthcare Investors, Inc. (NYSE:OHI) announced its results
of operations for the quarter ended June 30, 2003. The Company
reported net income available to common stockholders for the
three-month period ended June 30, 2003 of $1.8 million on revenues
of $20.8 million. This compares to a net loss of $5.6 million for
the same period in the prior year. The Company also reported Funds
From Operations on a fully diluted basis for the three months
ended June 30, 2003 of $8.5 million. The $8.5 million FFO included
a non-cash interest expense of $2.6 million related to the
termination of the Company's two previous credit facilities.

Also, as announced on July 23, 2003, the Company's Board of
Directors declared a full catch-up of its cumulative, unpaid
dividends for all classes of preferred stock to be paid August 15,
2003 to preferred stockholders of record on August 5, 2003. In
addition, the Board declared the regular quarterly dividend for
all classes of preferred stock to be paid on August 15, 2003 to
preferred stockholders of record on August 5, 2003.

Revenues for the three-month period ended June 30, 2003 totaled
$20.8 million, a decrease of $13.6 million as compared to the same
period in 2002. When excluding nursing home revenues of owned and
operated assets, revenues decreased $1.4 million versus the three-
month period ended June 30, 2002. The decrease was primarily the
result of operator restructurings.

Expenses for the three-month period ended June 30, 2003 totaled
$15.3 million, a decrease of $19.3 million from the same period in
2002. Excluding nursing home expenses of owned and operated
assets, expenses were $15.2 million for the three-month period
ended June 30, 2003 versus $21.2 million for the same period in
2002. The $6.0 million decrease primarily resulted from a
provision for impairment of $2.5 million and a provision for
uncollectible mortgages, notes and accounts receivable of $3.7
million, both taken in 2002.

Nursing home expenses, net of nursing home revenues, for owned and
operated assets for the three-month period ended June 30, 2003
were $0.1 million, a decrease of $1.2 million from the same period
in 2002. The decrease was primarily a result of the decrease in
the number of owned and operated facilities from 13 at June 30,
2002 to one at June 30, 2003.

During the three-month period ended June 30, 2003, the Company
sold its investment in a Baltimore, Maryland asset, leased by the
United States Postal Service, for approximately $19.6 million. The
purchaser paid the Company gross proceeds of $1.95 million and
assumed the first mortgage of approximately $17.6 million. As a
result, the Company recorded a gain of $1.3 million, net of
closing costs and other expenses.

Funds from operations for the three-month period ended June 30,
2003, on a fully diluted basis, was $8.5 million or $0.15 per
common share, an increase of $3.5 million, as compared to $5.0
million or $0.06 per common share for the same period in 2002 due
to the factors mentioned above. Additionally, the $8.5 million FFO
included a non-cash interest expense of $2.6 million related to
the termination of the Company's two previous credit facilities.
For further information, see Bank Credit Agreements below and the
attached Funds From Operations schedule and notes.

The Company believes that presentation of the Company's revenues
and expenses, excluding nursing home owned and operated assets,
provides a useful measure of the operating performance of the
Company's core portfolio as a Real Estate Investment Trust in view
of the disposition of all but one of the Company's owned and
operated assets. For 2003, nursing home revenues, nursing home
expenses, operating assets and operating liabilities for the
Company's owned and operated properties are shown on a net basis
on the face of the Company's consolidated financial statements.
For 2002, nursing home revenues, nursing home expenses, operating
assets and operating liabilities for the Company's owned and
operated properties are shown separately on a gross basis on the
face of the Company's consolidated financial statements.

                      Portfolio Developments

Alterra Healthcare Corporation. Alterra announced during the first
quarter of 2003, that, in order to facilitate and complete its on-
going restructuring initiatives, they had filed a voluntary
petition with the U.S. Bankruptcy Court for the District of
Delaware to reorganize under Chapter 11 of the U.S. Bankruptcy
Code. At that time, the Company leased eight assisted living
facilities (325 units) located in seven states to subsidiaries of
Alterra.

Effective July 7, 2003, the Company amended its Master Lease with
a subsidiary of Alterra whereby the number of leased facilities
was reduced from eight to five. The amended Master Lease has a
remaining term of approximately ten years with an annual rent
requirement of approximately $1.5 million. This compares to the
2002 annualized revenue of $2.6 million. The Company is in the
process of negotiating terms and conditions to re-lease the
remaining three properties. In the interim, Alterra will continue
to operate the three facilities. The Amended Master Lease has been
approved by the U.S. Bankruptcy Court in the District of Delaware.

Sun Healthcare Group, Inc.  During the second quarter of 2003, Sun
remitted rent of $5.2 million versus the contractual amount of
$6.7 million. The $5.2 million rent payment was made up of $3.8
million in cash and the remaining security deposits of $1.4
million. All security deposits with Sun have been used.

Effective July 1, 2003, the Company re-leased five former Sun
skilled nursing facilities in the following three separate lease
transactions: (i) a Master Lease of two SNFs in Florida,
representing 350 beds, which Master Lease has a ten-year term and
an initial annual lease rate of $1.3 million; (ii) a Master Lease
of two SNFs in Texas, representing 256 beds, which Master Lease
has a ten-year term and an initial annual lease rate of $800,000;
and (iii) a lease of one SNF in Louisiana, representing 131 beds,
which lease has a ten-year term and an initial annual lease rate
of $400,000. Aggregate monthly contractual lease payments under
all three transactions, totals approximately $208,000.

The Company continues its ongoing restructuring discussions with
Sun. At the time of this release, the Company cannot comment on
the timing or outcome of these discussions. However, as a result
of the above mentioned transitions of the five former Sun SNFs,
Sun's contractual monthly rent, starting in July, was reduced $0.2
million from approximately $2.2 million to approximately $2.0
million.

Claremont Healthcare Holdings, Inc.  Claremont failed to pay base
rent due on July 1, 2003 in the amount of $0.5 million. On
July 21, 2003, the Company drew on a letter of credit (posted by
Claremont as a security deposit) in the amount of $0.5 million to
pay Claremont's July rent payment and demanded that Claremont
restore the $0.5 million letter of credit. As of the date of this
release, the Company has additional security deposits in the form
of cash and letters of credit in the amount of $2.0 million
associated with Claremont. The Company is recognizing revenue from
Claremont on a cash-basis as it is received.

Other Assets. In addition to the sale of the Baltimore, Maryland
asset, the Company sold one held for sale facility in Indiana for
a gain of approximately $0.1 million during the second quarter.
During July, the Company sold three additional closed facilities
resulting in a gain of approximately $0.7 million.

                       Bank Credit Agreements

In June 2003, the Company completed a new $225 million Senior
Secured Credit Facility arranged and syndicated by GE Healthcare
Financial Services. At the closing, the Company borrowed $187.1
million under the new Credit Facility to repay borrowings under
its two previous credit facilities and replace letters of credit.
In addition, proceeds from the loan are permitted to be used to
pay cumulative unpaid preferred dividends and for general
corporate purposes.

The new Credit Facility includes a $125 million term loan and a
$100 million revolving line of credit fully secured by 121
facilities representing approximately half of the Company's
invested assets. Both the Term Loan and Revolver have a four-year
maturity with a one-year extension at the Company's option. The
Term Loan amortizes on a 25-year basis and is priced at London
Interbank Offered Rate plus a spread of 3.75%, with a floor of
6.00%. The Revolver is also priced at LIBOR plus a 3.75% spread,
with a 6.00% floor.

At June 30, 2003, the Company had $187.1 million of Credit
Facility borrowings outstanding and $12.5 million of letters of
credit outstanding, leaving availability of $25.4 million. In
addition, on June 30, 2003, the Company had approximately $45.5
million in invested cash.

                         Dividend Policy

As announced on July 23, 2003, the Company's Board of Directors
declared a full catch-up of its cumulative, unpaid dividends for
all classes of preferred stock to be paid August 15, 2003 to
preferred stockholders of record on August 5, 2003. In addition,
the Board declared the regular quarterly dividend for all classes
of preferred stock to be paid on August 15, 2003 to preferred
stockholders of record on August 5, 2003.

Series A and Series B preferred stockholders of record on
August 5, 2003 will be paid dividends in the amount of
approximately $6.36 and $5.93 per preferred share, respectively,
on August 15, 2003. The Company's Series C preferred stockholder
will be paid dividends of approximately $27.31 per Series C
preferred share on August 15, 2003. The liquidation preference for
the Company's Series A, B and C preferred stock is $25.00, $25.00
and $100.00 per share, respectively, excluding cumulative unpaid
dividends. Total dividend payments for all classes of preferred
stock are approximately $55.1 million.

The table below sets forth the per share dividends payable on
August 15, 2003 to holders of record of preferred stock as of
August 5, 2003. Cumulative unpaid dividends represent unpaid
dividends accrued for the period from November 1, 2000 through
April 30, 2003. Regular quarterly dividends represent dividends
for the period May 1, 2003 through July 31, 2003.

                                    Series A  Series B   Series C
                                    --------- --------- ----------
Liquidation Preference Per Share     $25.00    $25.00    $100.00
                                    ========= ========= ==========
Aggregate Liquidation Preference
(in $ millions)                      $57.50    $50.00    $104.84
                                    ========= ========= ==========

Regular Quarterly Dividends Per Share
  Payable on August 15, 2003        $0.57813  $0.53906   $2.50000
Cumulative Unpaid Prior Dividends Per
Share                               5.78125   5.39063   24.80670
                                    --------- --------- ----------
Total Dividends Per Share
  Payable on August 15, 2003        $6.35938  $5.92969  $27.30670
                                    ========= ========= ==========

The Board currently expects to consider the Company's common
dividend policy at its next regularly scheduled Board of Directors
meeting. At this time, the Company can give no assurance as to if,
or when, dividends will be reinstated on common stock, or the
amount of the dividends if, and when, such payments are
recommenced.

Omega is a Real Estate Investment Trust investing in and providing
financing to the long-term care industry. At June 30, 2003, the
Company owned or held mortgages on 221 skilled nursing and
assisted living facilities with approximately 21,900 beds located
in 28 states and operated by 34 third-party healthcare operating
companies.

                          *     *     *

As previously reported in Troubled Company Reporter, Standard &
Poor's Ratings Services revised its ratings outlook for Omega
Healthcare Investors Inc., to stable from positive. At the same
time, the ratings were affirmed.

                          LIQUIDITY

Omega's new management team (and major investor) has achieved
success in restoring Omega's liquidity position through its
releasing efforts of the company's owned and operated portfolio,
using proceeds from asset sales and suspended dividends to
reduce outstanding debt. This, coupled, with extensive core
portfolio restructuring and a rights offering and private
placement in 2002, enabled the company to meet maturing debt
obligations, achieve an extension on its bank line, and reduce
leverage from 48% debt-to-book capitalization at fiscal year-end
2001 to 39% at fiscal year-end 2002. Debt coverage measures have
also been favorably impacted, increasing from 1.3x debt service
in 2001 to roughly 2x in 2002. The company currently has $112
million outstanding under its $160 million secured bank revolver
that expires December 31, 2003. Management is in the process of
negotiating an extension of the facility and/or arranging a new
bank financing to refinance the outstanding balance. The company
will have to work around covenants within Omega's public
unsecured notes ($100 mil. remaining), which require unsecured
asset coverage of 2x. With roughly $550 million in owned assets
(depreciated basis) and an additional $211 million in mortgage
and other investments, there appears to be sufficient room to
accommodate the expected refinancing. Unrestricted cash balances
have grown modestly throughout 2002, and currently stand at
roughly $15 million.

                         OUTLOOK REVISED

Omega Healthcare Investors Inc.
                                                   Rating
                                                To        From
    Corporate credit                         B/Stable
B/Positive

                         RATINGS AFFIRMED

Omega Healthcare Investors Inc.
                                                      Rating
    $100 mil. 6.95% senior notes due 2007             CCC+
    $57.5 mil. 9.25% cum pref stk ser A               D
    $50 mil. 8.625% cum pref stk ser B                D


OMI TRUST: S&P Drops Subordinate B-1 Class Note Rating to D
-----------------------------------------------------------
Standard & Poor's Ratings Services lowered its rating on the
subordinate B-1 class of OMI Trust 2000-D to 'D' from 'CC'.

The lowered rating reflects the unlikelihood that investors will
receive timely interest and the ultimate repayment of their
original principal investment. OMI Trust 2000-D reported an
outstanding liquidation loss interest shortfall in the amount of
$11,595.27 for the B-1 class on the July 2003 payment date.
Standard & Poor's believes that B-1 interest shortfalls will
continue to be prevalent in the future, given the adverse
performance trends displayed by the underlying pool of
manufactured housing retail installment contracts originated by
Oakwood Homes Corp., and the location of B-1 write-down interest
at the bottom of the transaction payment priorities (after
distributions of senior principal).

The default of the B-1 class is indicative of the poor performance
of the underlying pool of manufactured housing contracts and high
projected cumulative net losses following Oakwood's Nov. 15, 2002
announcement that it was filing for Chapter 11 bankruptcy
protection. After 31 months of performance, OMI 2000-D displays
cumulative net loss and a repossession inventory rate that
significantly exceeds expectations at 14.91% of the original pool
balance and 9.96% of the current pool balance, respectively.
In addition, recovery rates on liquidated collateral continue to
be very low (24.65% cumulative recovery rate for June 2003), while
monthly recovery rates have not been greater than 10% during the
last four months.

High losses during the last year have reduced the transaction's
overcollateralization ratio to zero and have resulted in the
write-down of the B-1 class. The future liquidation of
repossession inventory, in conjunction with OMI Trust 2000-D's low
recovery rate, is expected to further affect this credit support
negatively. Standard & Poor's will continue to monitor the ratings
associated with the remaining classes.


PG&E NATIONAL: Wants Nod to Hire Ordinary Course Professionals
--------------------------------------------------------------
The PG&E National Energy Group Debtors occasionally need
assistance from specialized or local professionals in connection
with the operation of their businesses.  These include tax, real
estate, environmental, employee, regulatory, litigation,
transactional, business consulting, and other consultants and
professionals.  To address these matters, the NEG Debtors need to
employ attorneys and other professionals on an "as needed" basis
in specific locations to deal with issues that arise in their
businesses.

Due to the limited nature of the work performed by the ordinary
course professionals and the costs associated with the preparation
and retention and fee applications for those professionals, it
would be impractical and burdensome for the NEG Debtors to submit
individual application for each Ordinary Course Professional and
seek approval for their compensation.  For this reason, the NEG
Debtors ask the Court for authority to employ and compensate
Ordinary Course Professionals without the need to file individual
retention applications.

Martin T. Fletcher, Esq., at Whiteford, Taylor & Preston LLP, in
Baltimore, Maryland, relates that individuals can be determined
to be a "professional" within the meaning of Section 327 of the
Bankruptcy Code by either a quantitative or qualitative test.
Under the quantitative test, only entities whose duties are
central to the administration of the estate will be considered
professionals under Section 327.  By contrast, an entity is
considered a professional if it is permitted to exercise
discretion and autonomy in addressing the administration or the
estate under the qualitative test.  However, Mr. Fletcher states
that the approval is not necessary for "one who provides services
to the debtor that is necessary whether or not the petition was
filed".

In addition, Mr. Fletcher notes, a non-exhaustive list of factors
has been developed for determining an employed professional by
harmonizing quantitative and qualitative standards.  These
factors include:

    a. Whether the entity controls, manages, administers, invests,
       purchases or sells that are significant to the debtor's
       reorganization;

    b. Whether the entity in involved in negotiating terms of a
       plan of reorganization;

    c. Whether the employment is directly related to the type of
       work carried out by the debtor of the routine maintenance
       of the debtor's business operations;

    d. Whether the entity is given discretions to exercise his or
       her own professional judgment in some part of the
       administration of the debtor's estate;

    e. The extent of the entity's involvement in the
       administration of the debtor's estate; and

    f. Whether the entity's services involve some degree of
       special knowledge of skill, such that the entity can be
       considered a professional within the ordinary meaning of
       the term.

Mr. Fletcher represents that the NEG Debtors propose to pay the
Ordinary Course Professionals, on a monthly basis, 100% of the
interim postpetition fees and disbursements included in an
appropriate invoice that indicates in reasonable detail the
nature of the services by each Ordinary Course Professional.
With consent of a statutorily appointed committee and the U.S.
Trustee, the NEG Debtors further propose to pay the Ordinary
Course Professionals without further delay, provided that the
fees and disbursements to be paid do not exceed $25,000 in any
month or $100,000 in any six-month period.

A quarterly report will be provided to the U.S. Trustee and the
Committees setting forth:

    (1) All Ordinary Course Professionals who received payments
        during each month prior in that quarter;

    (2) The aggregate amount of payments to each Ordinary Course
        Professional to date; and

    (3) The substance of the work performed by each Ordinary
        Course Professional during the quarter.

The NEG Debtors maintain that no creditor or party-in-interest
will be prejudiced by the approval of their request. (PG&E
National Bankruptcy News, Issue No. 3; Bankruptcy Creditors'
Service, Inc., 609/392-0900)


PILLOWTEX CORP: Banks Extend Forbearance Agreement to Thursday
--------------------------------------------------------------
Pillowtex Corporation's (OTC: PWTX) term loan lenders -- the
lenders who financed Pillowtex's emergence from chapter 11 in May
2002 -- have extended a forbearance agreement set to expire July
25, 2003 under which the Company's lenders agreed to abstain from
exercising the rights and remedies available to them as a result
of certain defaults under the Company's term loan agreement. The
forbearance agreement is now in effect through July 31, 2003.  The
Company is continuing to work with its term loan and revolving
loan lenders in reviewing its strategic alternatives.

Press reports related that Pillowtex told many of its employees to
stay home this week.

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


POSSIBLE DREAMS: Security Capital Sells 25% in Parent Company
-------------------------------------------------------------
Security Capital Corporation (AMEX: SCC) has sold, for nominal
consideration, a 25% interest in Possible Dreams Ltd.'s parent
company, P.D. Holdings, Inc., to Russell F. Peppet, newly-named
Chairman and CEO of Possible Dreams Ltd.

Possible Dreams is the Company's subsidiary which operates as a
designer, importer, and distributor of collectible and fine
quality figurines and, to a lesser extent, other specialty
giftware.

This sale is the first step in the Company's plan to dispose of
its entire interest in its Possible Dreams subsidiary and is
intended to incent Mr. Peppet to effectively manage Possible
Dreams until an orderly disposition of the remainder of the
business can be achieved. The Company expects to record a net
charge of approximately $1.8 million in the third quarter in
connection with this transaction, primarily relating to the write
off of a deferred tax asset which can no longer be utilized as a
result of the sale.

As indicated in the Company's Form 10-Q for the quarter ended
March 31, 2003, Possible Dreams was not in compliance with certain
debt covenants, and no waiver had been pursued because of
foreseeable covenant violations in the next four quarters. These
covenant violations still exist. Remedies upon an event of default
under the loan agreement include a right of the lender to take
possession of any or all of the collateral as defined under the
agreement.

The debt at Possible Dreams is neither cross-collateralized nor
guaranteed by the Company or any other subsidiary of the Company.
The Company has determined that it does not wish to invest
significant additional funds in Possible Dreams. The possible
inability of Possible Dreams to continue as a going concern should
have no significant impact upon the remainder of the Company.

Security Capital Corporation operates four subsidiaries in three
distinct business segments. The Company participates in the
management of its subsidiaries while encouraging operating
autonomy and preservation of entrepreneurial environments. The
three business segments of SCC are employer cost containment and
health services, educational services, and seasonal products.
Possible Dreams is a portion of the Company's seasonal products
segment.


QUAIL PIPING: Seeks Authority to Hire Gadsby Hannah as Counsel
--------------------------------------------------------------
Quail Piping Products, Inc., is asking for permission from the
U.S. Bankruptcy Court for the Northern District of Texas to employ
Gadsby Hannah LLP as its Counsel.

The Debtor reports that, in preparing for this chapter 11 case,
Gadsby Hannah became familiar with the Debtor's business and
affairs and many of the potential legal issues which may arise as
the company restructures.

Charles, A. Dale, III, Esq., reports that Gadsby Hannah will bill
for legal services at ordinary and customary rates ranging from:

          partners                $330 to $500 per hour
          associates              $195 to $300 per hour
          paraprofessionals       $100 to $150 per hour

Gadsby Hannah will:

     a. provide legal advice with respect to the Debtor's powers
        and duties as debtor-in-possession in the continued
        operation of its business and management of its
        property;

     b. prepare and file all necessary motions, notices, and
        other pleadings necessary to sell substantially all of
        the Debtor's assets;

     c. prepare and pursue approval of a disclosure statement
        and confirmation of a plan of reorganization;

     d. prepare on behalf of the Debtor all necessary
        applications, motions, answers, orders, reports and
        other legal papers;

     e. appear in Court on behalf of the Debtor and protecting
        the interests of the Debtor before the Court; and

     f. perform all other legal services for the Debtor which
        may be necessary and proper in these proceedings.

Quail Piping Products, Inc., headquartered in Wichita Falls,
Texas, manufactures pressure pipes and corrugated pipes. The
Company filed for chapter 11 protection on July 15, 2003 (Bankr.
N.D. Tex. Case No. 03-70583).  Charles A. Dale, III, Esq., at
Gadsby Hannah, LLP represents the Debtor in its restructuring
efforts.  When the Company filed for protection from its
creditors, it listed estimated debts and assets of over $10
million each.


QUANTUM CORP: Sells $160 Million of 4.375% Conv. Sub. Notes
-----------------------------------------------------------
Quantum Corporation (NYSE: DSS) has agreed to privately place $160
million aggregate principal amount of 4.375% convertible
subordinated notes due 2010. Quantum has granted the purchasers of
the notes a 30-day option to purchase up to an additional $24
million principal amount of the notes.  The notes will be
unsecured subordinated obligations, convertible into Quantum
common stock at a conversion price of approximately $4.35 per
share.  The placement of the notes is expected to close on
July 30, 2003.

The net proceeds of the offering will be used to redeem Quantum's
7% convertible subordinated notes due 2004.

The securities will not be registered under the Securities Act of
1933, as amended, or any state securities laws, and unless so
registered, may not be offered or sold in the United States except
pursuant to an exemption from the registration requirements of the
Securities Act and applicable state laws.

As reported in Troubled Company Reporter's Monday Edition,
Standard & Poor's Ratings Services affirmed its 'BB-' corporate
credit and senior unsecured ratings on Quantum Corp. and assigned
a 'B' rating to Quantum's proposed $175 million subordinated
convertible bond. The outlook is stable. Quantum had $288 million
of debt outstanding as of June 30, 2003.

Milpitas, California-based Quantum is a leading designer and
manufacturer of tape-based storage drives and systems as well as
tape media.


REINK CORP: Court Converts Bankruptcy Case to Chapter 7
-------------------------------------------------------
Reink Imaging USA, Ltd., the main operating subsidiary of Reink
Corp., which had previously filed for protection under Chapter 11
has now been converted to Chapter 7 under the United States
Bankruptcy Code, effective July 10, 2003.

Reink Corporation's March 31, 2003 balance sheet shows a working
capital deficit of about $2.7 million, and a total shareholders'
equity deficit of about $2.5 million.

Reink Corp, Inc., was incorporated in Delaware on March 6, 1999
and, through its wholly owned subsidiaries Reink Imaging USA, Ltd.
and Reink Canada Corp., manufactures bulk ink, toner cartridges
for sale to customers as well as ink for use in the manufacturing
of ink jet refill kits using a patented method to refill ink jet
cartridges and re-manufacture compatible cartridges. The products
are sold to both wholesale distributors and retail office supply
stores.

On December 31, 2002, the CEO, VP of Finance and one of the
production chemists from the Company's R&D facility resigned.
Prior to resigning the Former officers dismissed all employees of
the Company's main operating subsidiary, Reink USA. The Company
has commenced legal proceedings against the Former Officers of the
Company for actions it believes to be in violation of non-
competition and confidentiality clauses within their employment
contracts. The Company has also applied for an injunction against
a business, which the Company believes, is being operated by the
Former Officers and competes directly with the Company.

As a result of the departure of the Former Officers, the remaining
management dropped the impact ribbon business product line and
also made the decision to outsource the remanufactured toner
business in 2003. In January 2003, the Company closed down its
manufacturing facility in Pennsauken, New Jersey and moved all
inventory and equipment to other locations. At December 31, 2002
the Company wrote down inventories related to the impact ribbons
and toner product lines to their estimated fair values. The
Company had an impairment charge on certain fixed assets as a
result of closing the manufacturing facility. In addition, the
Company had an impairment charge on its goodwill relating to the
changes to the impact ribbon and toner product lines.

In January 2003 the three largest creditors of Reink USA filed a
petition to force the subsidiary into Chapter 7 under the US
Federal Bankruptcy Code. The Company believes that some of the
creditors involved with the petition are supplying the new
business, which competes directly with the Company, founded by the
Former Officers. Reink USA filed a motion to have the petition
dismissed since the third creditor withdrew from the filing and
also since the counsel for the petitioners withdrew. Subsequently
the remaining two creditors provided a new third creditor and
amended the filing. This new third creditor also subsequently
withdrew and the two remaining creditors found two other creditors
and filed an amendment. During March 2003, the subsidiary's motion
to convert to a voluntary chapter 11 was accepted by the District
of New Jersey, Federal Bankruptcy Court. Reink is controlling the
proceedings and Reink USA is preparing a plan of reorganization to
submit to the court and the creditors. Substantially all of the
assets except for the real estate held for sale and liabilities
except for real estate mortgage of $600,000, are assets and
liabilities, which are part of the Chapter 11, filing.

The Company has incurred recurring losses and has a working
capital deficiency, at March 31, 2003, of approximately
$2,700,000. The Company expects that the growth and expansion of
operations will require capital infusions of a minimum of
$1,500,000 necessary to fund the purchase of inventory and to meet
the Company's working capital needs. During the three months ended
March 31, 2003 the Company raised an additional $165,000 through
the issuance of promissory notes bearing interest at 12%, payable
semi-annually and convertible into common stock at $0.05/share.

The recovery of assets and continuation of future operations are
dependent upon the Company's ability to execute its plan of
reorganization, to obtain additional debt or equity financing, and
its ability to generate revenues sufficient to fund its
operations. There can be no assurances that the Company's plan of
reorganization will be accepted and that the Company will be
successful in its attempts to generate positive cash flows or
raise sufficient capital essential to its survival. To the extent
that the Company is unable to generate or raise the necessary
operating capital it will become necessary to further curtail or
cease operations. Additionally, even if the Company does raise
operating capital, there can be no assurances that the net
proceeds will be sufficient enough to enable it to develop its
business to a level where it will generate profits and positive
cash flows. These matters raise substantial doubt about the
Company's ability to continue as a going concern. However, the
accompanying financial statements have been prepared on a going
concern basis, which contemplates the realization of assets and
satisfaction of liabilities in the normal course of business. The
financial statements do not include any adjustments relating to
the recovery of the recorded assets or the classification of the
liabilities that might be necessary should the Company be unable
to continue as a going concern.


REUNION IND.: Hires Wiss & Co. to Replace Ernst & Young as Auditor
------------------------------------------------------------------
On July 21, 2003, after giving consideration to proposals for
auditing services from selected national accounting firms, Reunion
Industries, Inc. replaced Ernst & Young LLP as the independent
accountants of Reunion Industries, Inc.

The reports of Ernst & Young LLP on the financial statements for
the past two fiscal years were modified as to uncertainty
surrounding the Company's ability to continue as a going concern.

Effective on July 21, 2003, Reunion Industries engaged Wiss &
Company LLP as its new independent accountants.

Reunion's Metals Group, through its five manufacturing divisions,
manufactures and markets a broad range of metal fabricated and
machined industrial parts and products, including seamless steel
pressure vessels, fluid power cylinders, industrial cranes, leaf
springs and storage racks.


RIDGEWOOD HOTELS: Moore Stephens Expresses Going Concern Doubt
--------------------------------------------------------------
Ridgewood Hotels, Inc., a Delaware corporation, is primarily
engaged in the hotel management business. The Company currently
manages four mid to luxury hotels containing 671 rooms located in
two states and Scotland, including the Chateau Elan Winery &
Resort located in Braselton, Georgia. The Company also owns one
hotel that it manages, owns undeveloped land that it holds for
sale and manages a golf resort and a restaurant.

Effective April 1, 2001, the Company operates in two reportable
business segments: hotel operations and hotel management services.
The Company's current hotel operations segment consists solely of
a 271 room hotel it owns (through its subsidiaries) in
Hurstbourne, Kentucky. The hotel is franchised with Holiday Inn.
The Company's hotel management services segment currently consists
of four managed hotels, excluding the operating hotel described
above, a golf resort in California and a restaurant in Georgia.
Three of these hotels and the golf resort are owned by
Fountainhead Development Corp., and another hotel is owned by both
the Company's Chairman and its President.

The Company's loss of $1,467,000 for the fiscal year ended March
31, 2003 was comprised of the following: (1) approximately a
$960,000 loss as a result of the hotel management operations,
administrative, debt service and depreciation and amortization
costs of the Company and (2) approximately a $507,000 operating
loss by the wholly-owned hotel of the Company. The Company's loss
of $1,268,000 for the fiscal year ended March 31, 2002 was
comprised of the following: (1) approximately a $683,000 loss as a
result of the hotel management operations, administrative, debt
service and depreciation and amortization costs of the Company and
(2) approximately a $585,000 operating loss by the wholly-owned
hotel of the Company. The Company's income before income taxes of
$30,000 for the fiscal year ended March 31, 2001 was comprised of
the following: (a) a $2,856,000 gain on the sale of the hotel in
Longwood, Florida (b) a $2,000,000 writedown on the investment in
the Louisville Hotel, (c) additional bad debt reserve of $189,000,
and (d) an operating loss of $637,000.

The Company's recurring losses and negative operating cash flows
raise substantial doubt about the Company's ability to continue as
a going concern. The Company is continuing its efforts to return
to profitability by continuing (i) to seek new opportunities to
manage resort properties , (ii) to take steps to reduce costs
(including administrative costs) and (iii) its efforts to increase
the revenue at existing properties managed by the Company.

The Company had a change in its certifying accountants. Deloitte
and Touche resigned as the Company's independent accountants on
May 1, 2003. The Company engaged Moore Stephens Lovelace, P.A. as
its new independent accountants as of May 9, 2003.

The Auditors Report dated July 2, 2003, at Orlando, Florida, by
Moore Stephens Lovelace, P.A. contained the following paragraph:
"The accompanying consolidated financial statements have been
prepared assumingb Ridgewood Hotels, Inc. and Subsidiaries will
continue as a going concern. As discussed in Note 13 of the notes
to the financial statements, the Company has incurred recurring
losses and has a working capital deficiency. These conditions
raise substantial doubt about the Company's ability to continue as
a going concern. Management's plan in regard to these matters are
also described in Note 13. The consolidated financial statements
do not include any adjustments that might result from the outcome
of this uncertainty."


ROSSBOROUGH-REMACOR: Turning to Parkland for Financial Advice
-------------------------------------------------------------
Rossborough-Remacor LLC seeks permission from the U.S. Bankruptcy
Court for the Northern District of Ohio to employ The Parkland
Group, Inc., as its Financial Advisor while in chapter 11.

The Debtor wants to employ Parkland Group because it has had
considerable experience in matters of this nature and is well
qualified to provide necessary services to the Company.

In this retention, Parkland Group will:

     a) review Debtor's financial and operational information
        and refining and updating various financial models and
        projections;

     b) source and negotiate DIP and other financing, and/or new
        equity, for the Debtor;

     c) act as the Debtor's primary agent to market the Reagent,
        Steelside and West Pittsburgh business lines for sale,
        including:

        1. preparing a descriptive Memorandum to assist in the
           marketing process,

        2. identifying potential strategic and other potential
           purchasers,

        3. contacting potential purchasers and relevant
           intermediaries to determine initial interest,

        4. coordinating the placement of appropriate
           advertisements to elicit additional potential
           purchasers,

        5. coordinating the provision of relevant additional
           information as required by potential buyers,

        6. supervising and coordinating site visits and due
           diligence visits by potential purchasers,

        7. assisting the Debtor in the review, analysis and
           comparison of offers,

        8. assisting in the negotiation of price and terms, as
           required;

     d) review Debtor's operations, organization, industry,
        financial information and other related information
        necessary to assist the Debtor in identifying
        opportunities to improve their business operations and
        financial status. To the extent necessary, assist the
        Debtor in the implementation of such changes or actions;

     e. assist the Debtor in the disposal of assets not
        essential to the continued operation of the companies,
        or for which no bidder can be found;

     f. render financial advice to the Debtor to assist in the
        formulation of a business plan and plan of
        reorganization; and

     g. assist in operating the Debtor's businesses, as and if
        necessary.

Parkland Group's current hourly rates range from:

          Partners/Directors       $300 to $350 per hour
          Managing Directors       $250 to $290 per hour
          Senior Consultants       $200 to $250 per hour
          Consultants              $150 to $200 per hour

Current hourly rates for Parkland Group's professionals are:

     Laurence V. Goddard   President           $350 per hour
     Christina M. Lucas    Partner             $300 per hour
     Mark D. Kozel         Managing Director   $260 per hour
     David Sanders         Managing Director   $270 per hour
     Rita Dawson           Senior Consultant   $250 per hour

Rossborough-Remacor, LLC, headquartered in Avon Lake, Ohio, is a
producer of additives used to deoxidize, desulfurize and condition
steel slag.  The Company filed for chapter 11 protection on June
18, 2003 (Bankr. N.D. Ohio Case No. 03-18020).  Diana M. Thimmig,
Esq., at Arter & Hadden LLP represents the Debtor in its
restructuring efforts. When the Company filed for protection from
its creditors, it listed $18,709,681 in total assets and
$22,644,854 in total debts.


SAFETY-KLEEN: Court Okays Settlement with Heritage Environmental
----------------------------------------------------------------
Safety-Kleen Corp. and Safety-Kleen Systems, Inc., obtained Judge
Walsh's permission to settle with Heritage Environmental Services
LLC, Heritage Crystal Clean LLC, and Edward Guglielmi, Kevin
Hennkens, Bret A. Henry, Billy J. Hurin, Scott D. Lisberg, Michael
McGinn, Don R. Pennell, Craig Andrew Rose, Dennis R. Salvino, John
Ure, and Jim Zielinski, individually, which, among other things,
fully resolves any and all claims, disputes or causes of action
between and among the Debtors, HES, HEC, and the Individual
Parties.

These include all claims, disputes or causes of action, which are
or could have been asserted by any of the parties in connection
with any and all of these lawsuits:

      -- "Safety-Kleen Corporation v. Heritage Environmental
         Systems, LLC; Heritage Crystal Clean, LLC; Crystal Clean
         Parts Washer Service, Billy J. Hurin, and John Ure,"
         pending in the South Carolina Court of Common Pleas in
         Richmond County;

      -- "Safety-Kleen Systems, Inc. v. Edward Gugliemi, Scott D.
         Lisberg, and Dennis R. Salvino," pending in Federal
         District Court in the Northern District of Illinois;

      -- "Safety-Kleen Systems, Inc. v. Craig Andrew Rose,"
         pending in Federal District Court in the Northern
         District of Illinois;

      -- "Safety-Kleen Systems, Inc. v. Kevin Hennkens,"
         pending in Federal District Court in the Eastern
         District of Missouri;

      -- "Safety-Kleen Systems, Inc. v. Bret A. Henry," pending
         in the Illinois Tenth Circuit Court of Peoria County;

      -- "Safety-Kleen Systems, Inc. v. Don R. Pennell," pending
         in the Federal District Court in the Eastern District of
         Pennsylvania;

      -- "Safety-Kleen Systems, Inc. v. Michael McGinn," pending
         in the Federal District Court in the District of
         Massachusetts;

      -- "Safety-Kleen Systems, Inc. v. Jim Zielinski," pending
         in Federal District Court in the Western District of New
         York; and

      -- "Heritage Crystal Clean, LLC v. Safety-Kleen Corp. and
         Safety-Kleen Systems, Inc.," pending in Federal District
         Court in the Northern District of Illinois.

                    The Settlement Agreement

The most salient terms and conditions of the Settlement Agreement
are:

       (1) Dismissal of Litigation.  The Debtors, HES, HCC, and
           the Individual Parties will take all steps necessary
           to cause each of the Actions to be dismissed with
           prejudice and without costs, including filing a joint
           motion for dismissal in each of the Actions within
           five business days after the Effective Date of the
           Settlement Agreement;

       (2) Non-Disparagement.  Safety-Kleen and HCC will not,
           directly or indirectly, make, or encourage or cause
           any third-party to make, any false, misleading,
           disparaging, or defamatory statements about the other
           or the other's products or services;

       (3) Withdrawal of Objection and Administrative Claim.
           The Objection and the Administrative Claim are deemed
           to be withdrawn with prejudice on the Effective Date
           of the Settlement Agreement.  HCC agrees not to
           oppose in any manner confirmation of the Debtors'
           Plan -- as it may be amended from time to time;

       (4) Future Hiring Practices.  In any instance in which
           Safety-Kleen or HCC now or in the future hires or
           employs in any capacity a current or former employee
           of the other, the hiring party will take all
           appropriate and necessary steps to ensure that the
           employee does not use or convey to any other person
           or entity any confidential or trade secret
           information of the other party;

       (5) Removal of Information.  Safety-Kleen, HES, HCC, and
           the Individual Parties each will remove from their
           files and records any and all confidential or trade
           secret information of the others and will, at the
           option of the other, destroy or return any such
           confidential or trade secret information, if any.
           In the event that, at any time following the
           Effective Date of the Settlement Agreement,
           Safety-Kleen, HES or HCC comes into possession of any
           confidential or trade secret information of the other,
           it will make no use of such confidential or trade
           secret information and will promptly destroy or
           return any such information to the other;

       (6) Mutual Releases.  Except for the obligations created
           or arising under the Settlement Agreement, the
           parties exchange mutual releases; and

       (7) Effective Date.  The Effective Date of the Settlement
           Agreement will be 12:01 a.m. on the first date
           following the occurrence of the later of:

               (i) the entry of the proposed order, or

              (ii) the date upon which duly authorized
                   representatives of Safety-Kleen, HES, and HCC
                   have executed this Settlement Agreement,
                   regardless of whether any or all of the
                   Individual Parties will have executed the
                   Settlement Agreement, and provided that the
                   Settlement Agreement will become effective
                   as to each of the Individual Parties only upon
                   its execution by the duly authorized
                   representatives of Safety-Kleen, HES, HCC, and
                   the Individual Parties.
(Safety-Kleen Bankruptcy News, Issue No. 60; Bankruptcy Creditors'
Service, Inc., 609/392-0900)


SEITEL INC: Looks to FTI Consulting for Restructuring Advice
------------------------------------------------------------
Seitel, Inc., and its debtor-affiliates tell the U.S. Bankruptcy
Court for the District of Delaware that it needs to retain FTI
Consulting, Inc., to provide expert financial advice in their
chapter 11 proceedings.

The Debtors ask for permission from the Court to engage FTI
Consulting to provide:

     a) assistance to the Debtors in the preparation of
        financial related disclosures required by the Court,
        including the Schedules of Assets and Liabilities, the
        Statement of Financial Affairs and Monthly Operating
        Reports;

     b) assistance in the preparation of financial information
        for distribution to creditors and others, including, but
        not limited to, cash flow projections and budgets, cash
        receipts and disbursement analysis, analysis of various
        asset and liability accounts, and analysis of proposed
        transactions for which Court approval is sought;

     c) attendance at meetings and assisting in discussions with
        the Note Purchaser, potential investors, banks and other
        secured lenders, the Creditors' Committee appointed in
        this case, the United States. Trustee, other parties-in-
        interest and professionals hired by the same, as
        requested;

     d) assistance in the preparation of information and
        analysis necessary for the confirmation of a Plan of
        Reorganization in this chapter 1 I case;

     e) assistance with the evaluation and analysis of avoidance
        actions, including fraudulent conveyances and
        preferential transfers;

     f) litigation advisory services with respect to financial
        matters, along with expert witness testimony on case
        related issues as required by the Debtors; and

     g) render such other general business consulting or such
        other assistance as Debtors' management or counsel may
        deem necessary that are consistent with the role of a
        financial advisor and not duplicative of services
        provided by other professionals in this proceeding.

Lisa Poulin, a Senior Managing Director of FTI Consulting, will
lead this engagement.  FTI Consulting will charge the Debtors
currently hourly rates, which range from:

     Senior Managing Director           $525 - $595 per hour
     Directors/Managing Directors       $370 - $525 per hour
     Associates/Senior Associates       $185 - $365 per hour
     Administration/Paraprofessionals   $ 85 - $150 per hour

Seitel, Inc., headquartered in Houston, Texas, markets its
proprietary seismic information/technology to more than 400
petroleum companies, licensing data from its library and creating
new seismic surveys under multi-client projects.  The Company
filed for chapter 11 protection on July 21, 2003 (Bankr. Del. Case
No. 03-12227).  Scott D. Cousins, Esq., at Greenberg Traurig LLP,
represents the Debtors in their restructuring efforts.  When the
Company filed for protection from its creditors, it listed
$379,406,000 in total assets and $345,525,000 in total debts.


SINGING MACHINE: Grant Thornton Airs Going Concern Uncertainty
--------------------------------------------------------------
Grant Thornton LLP, Miami, Florida, in reporting on the financial
condition of Singing Machine Co., Inc., stated in its Auditors
Report dated June 24, 2003:  "The accompanying financial
statements have been prepared assuming the Company will continue
as a going concern. [O]n March 14, 2003, the Company was notified
of its violation of the net worth covenant of its Loan and
Security Agreement with its commercial lender and the Company was
declared in default under the Agreement. As of June 24, 2003, the
Company has minimal liquidity. In June 2003, this Lender amended
the Agreement through July 31, 2003 but did not waive the
condition of default.  This continuing condition of default raises
substantial doubt about the Company's ability to continue as a
going concern. The financial statements do not include any
adjustments that might result from the outcome of this
uncertainty."

The Company refers to the above by the following: "Our
consolidated financial statements as of and for the year ended
March 31, 2003 were prepared in conformity with accounting
principles generally accepted in the United States of America,
which contemplates continuation of the Company as a going concern.
Our independent auditors have issued a report dated June 24,
2003...stating that our default under our credit agreement with
LaSalle raises substantial doubt about our ability to continue as
a going concern. We have minimal liquidity as of June 24, 2003,
the date of the audit report, and our commercial lender has
declared us in default under the terms of our credit agreement,
which expires on July 31, 2003. For these reasons, our independent
auditors were concerned about our ability to continue as a going
concern. We are attempting to restructure our credit agreement
with our lender. Based upon cash flow projections, the Company
believes the anticipated cash flow from operations will be
sufficient to finance the Company's operating needs until
inventory is sold and the receivables subsequently collected,
provided the bank does not call the loan. However, there can be no
assurances that we will achieve our forecasted results and that
our cash flow from operations will be sufficient to finance our
operating needs until our inventory is sold. We are also seeking
other sources of long and short term capital. Because we can give
no assurance that we can achieve any of the foregoing, there is
substantial uncertainty about our ability to continue as a going
concern. Because we have a going concern certainty paragraph, it
may be more difficult for us to raise capital."


SK GLOBAL AMERICA: Bringing-In Togut Segal as Bankruptcy Counsel
----------------------------------------------------------------
SK Global America, Inc., asks the U.S. Bankruptcy Court for the
Southern District of New York for permission to employ Togut,
Segal & Segal LLP as its bankruptcy counsel.

CEO Seung Jae Kim tells Judge Blackshear that SK Global selected
TS&S as its attorneys because of the firm's knowledge and
experience.  TS&S represented represented Daewoo International
(America) Corp., (Bankr. Case No. 00-11050 (BRL) (S.D.N.Y.) in
its successful restructuring under chapter 11 and has been
actively involved in other major Chapter 11 cases, including In
re Enron Corp., et al., Case No. 01-16034 (AJG); In re Loews
Cineplex Entertainment Corporation, et al., Case No. 01-40346
(ALG); Onsite Access, Inc., Case No. 01-12879 (RLB);
Contifinancial Corporation, Case No. 00-12184 (ALG); Lois/USA,
Inc., Case No. 99-45910 (REG); and Rockefeller Center Properties,
Case No. 95-42089 (PCB).

Albert Togut, Esq., and Scott E. Ratner, Esq., lead the team of
TS&S lawyers charged with:

      * advising the Debtor of its powers and duties as a debtor-
        in-possession;

      * assisting in the preparation of financial statements,
        the schedules of assets and liabilities, the statement of
        financial affairs, and other reports and documentation
        required by the Bankruptcy Code and the Federal Rules
        of Bankruptcy Procedure;

      * representing the Debtor at all hearings on matters
        pertaining to its affairs as a debtor-in-possession;

      * prosecuting and defending litigated matters that may
        arise during this Chapter 11 case;

      * negotiating, formulating, and confirming a plan of
        reorganization for the Debtor;

      * counseling and representing the Debtor concerning the
        assumption or rejection of executory contracts and leases,
        administration of claims, and numerous other bankruptcy
        related matters arising from this case;

      * counseling the Debtor about various litigation and
        reorganization matters relating to this Chapter 11 case;
        and

      * performing such other bankruptcy services that are
        desirable and necessary for the efficient and economic
        administration of this Chapter 11 case.

SK Global paid TS&S $155,000 for prepetition legal work and paid
an additional $875,000 retainer in contemplation of the chapter
11 filing.  TS&S has applied the retainer to prepetition fees and
expenses and will give a final accounting when the Firm files its
First Interim Fee Application.  TS&S charges $550 to $675 per
hour for work performed by partners, and $115 to $470 per hour
for hours logged by paralegals and associates. (SK Global
Bankruptcy News, Issue No. 1; Bankruptcy Creditors' Service, Inc.,
609/392-0900)


SPIEGEL: Gets Go-Signal to Implement Key Employee Retention Plan
----------------------------------------------------------------
The Spiegel Inc., and its debtor-affiliates are authorized and
empowered to implement and make payments under the KERP, provided
that the KERP will include a separate retention bonus that will be
paid to employees who were entitled to receive the Second Half
2002 Incentive Bonuses on the same terms and conditions as
indicated in the Debtors' request with respect to the Second Half
2002 Incentive Bonuses.  Judge Blackshear also clarifies that the
Debtors will only implement and make payments under the KERP
pursuant to a written plan document that will be subject to the
prior review and reasonable approval of the Official Committee of
Unsecured Creditors.

The KERP Document must:

    (a) set forth the mechanisms for payment and the business
        performance targets for the Performance Incentive Plan;

    (b) provide that an employee may only receive a Separate
        Retention Bonus after having released all prepetition
        claims against the Debtors in connection with any
        prepetition bonuses;

    (c) provide that the Debtors will only make a payment to an
        employee pursuant to the KERP Document after having first
        determined that the employee is in good standing, in light
        of current and past performance as of the date the payment
        is to be made; and

    (d) provide that the Debtors will have the discretion to
        delay making a KERP Payment if they cannot determine at
        that time that an employee is in good standing.

                         *    *    *

                         Backgrounder

The KERP is designed to minimize management and other key employee
turnover by providing inducements to those employees to continue
working for the Debtors, as well as to enhance employee morale and
job commitment.  The Debtors believe that the implementation of
the KERP, paying the bonuses and performing under the Employment
Agreements are necessary to accomplish a successful reorganization
and to maximize recoveries for their constituencies.

In connection with their restructuring initiatives, the Debtors
have involuntarily terminated 900 employees postpetition.  In
addition, 1,250 employees have voluntarily terminated their
employment.  These terminations are adversely affecting the
Debtors' ability to retain critical employees, particularly those
in management positions and those at the corporate level.  The
employees' unfamiliarity with the Chapter 11 process exaggerates
their concerns regarding job security and the prospects of their
employer, hence contributing to a potentially unstable situation.

The Debtors emphasize that the continued operation of their
businesses depends on the retention of their key managers'
services and the maintenance of employee morale.  "If a key
manager is lost, it will be difficult and expensive to attract an
equally qualified replacement and would likely hinder the
implementation of the restructuring directives."

                            The KERP

After a thorough review of the Debtors' workforce and operational
needs, the Debtors' senior management with the assistance of
Watson Wyatt & Company developed the KERP, which has these key
components:

     (a) A retention plan structured to encourage key employees to
         remain with the Debtors during the restructuring period;

     (b) A transition bonus plan to provide the Debtors
         flexibility to determine the necessary workforce during
         the restructuring period and provide incentives to non-
         Retention Plan employees with uncertain employment
         periods;

     (c) A performance incentive plan to provide the necessary
         incentives for key employees during the restructuring
         period to meet the Debtors' business goals; and

     (d) An enhanced severance plan to provide employees with a
         sense of financial security due to their necessarily
         uncertain employment duration during the restructuring
         period.

The Debtors have assigned key employees to six organizational
levels that are eligible for the various plans other than the
Transition Bonus Plan:

          Level     Representative Position     # Eligible
          -----     -----------------------     ----------
            1       President & CEO                   2
            2       Senior Executives                12
            3       Key Executives                   19
            4       Senior Managers                  27
            5       Managers                        120
            6       Key Contributors                 45
                                                ----------
                    Total                           225

The Debtors anticipate that certain individuals who are promoted
or newly hired during the Chapter 11 cases may be added to the
KERP and that the cost of any additions will be offset by
workforce attrition.

                       The Retention Plan

The Retention Plan provides for retention bonuses ranging from
25% to 80% of the base salary -- the Retention Bonus varies by
the Key Employees level -- and payable according to this
schedule:

     * 25% six months after the Petition Date;
     * 35% 12 months after the Petition Date; and
     * 40% 60 days after the Debtors' emergence from Chapter 11.

The Retention Plan includes these provisions with respect to
those employees who were terminated or who are employed by a
business unit that is sold during the course of the
restructuring:

     -- Key Employees who voluntarily terminate their employment
        before the specified payout date will forfeit any relevant
        Retention Bonus amounts;

     -- Key Employees who are involuntarily terminated will
        receive the entire Retention Bonus at the time of
        termination, as well as an enhanced severance benefit; and

     -- Key Employees who are employed by a divested business unit
        will have their entire Retention Bonus paid at the time of
        divestiture or sale of significant business unit operating
        assets. (Spiegel Bankruptcy News, Issue No. 8; Bankruptcy
        Creditors' Service, Inc., 609/392-0900)


STILLWATER MINING: Reports $19 Million Net Loss for 2nd Quarter
---------------------------------------------------------------
Stillwater Mining Company (NYSE: SWC) reported a net loss of $19.3
million for the second quarter of 2003 on revenue of $58.9 million
compared to net income of $11.1 million on revenue of $75.0
million for the second quarter of 2002.

The 2003 second quarter results reflect lower revenues due to
lower combined PGM prices and production levels but results were
most significantly impacted by certain charges which related to
the issue of shares to Norimet Limited.  These items were a $14
million non cash charge to income tax relating to a portion of the
Company's tax losses which will not be utilized and $3 million
($1.8 million after tax) of costs which were charged to income.

For the six months of 2003, the Company reported a net loss of
$21.0 million on revenue of $121.5 million compared to net income
of $27.6 million on revenue of $151 million for the six months of
2002.

On June 23, 2003, the Company completed the stock purchase
transaction with Norilsk Nickel.  In connection with the
transaction, Stillwater issued 45,463,222 new shares of its common
stock to Norimet Limited, a wholly-owned subsidiary of Norilsk
Nickel, representing approximately 50.8% of Stillwater's
outstanding shares.  In consideration for the shares, Norimet paid
Stillwater approximately $100 million in cash and approximately
877,000 ounces of palladium metal.

Announcing the Company's results, Stillwater Chairman and Chief
Executive Officer, Francis R. McAllister said, "It is an exciting
time for the Company. We have successfully concluded the Norilsk
Nickel transaction and have already used some of the capital
received to pay down $50 million of our bank debt. At the end of
the quarter, we have $66 million in cash and additional amounts
available to us under our lines of credit.  We believe the
additional liquidity provided by the Norilsk Nickel transaction
will permit the Company to conduct its operations with a view to
cost-effective, profitable mining and marketing activities.  In
addition, we are in the process of seeking long-term contracts to
sell the palladium consideration received from Norilsk Nickel to
consumers in North America."

He continued, "The transaction also brought to the Company five
new directors nominated by Norilsk Nickel, including The Honorable
Donald W. Riegle Jr., a former U.S. Senator, Jack E. Thompson,
Vice Chairman of Barrick Gold Corporation, Craig L. Fuller, former
Chief of Staff to Vice President Bush, and two experienced
lawyers, Steven S. Lucas and Todd D. Schafer.  In addition, three
members of the Board before the closing, Patrick M. James, Joseph
P. Mazurek and Sheryl K. Pressler, agreed to continue on as the
"public directors," and were nominated in a manner that preserves
their independence from Norimet.

"In addition, during the next few months, we will be negotiating
with Norimet and Norilsk Nickel a platinum group metals agreement.
If we are able to successfully negotiate this agreement, we could
purchase up to 1,000,000 ounces of palladium from Norimet on an
annual basis and resell this palladium to customers in North
America pursuant to new long-term contracts.  This may provide us
with additional liquidity," he concluded.

                        OPERATING RESULTS

During the second quarter of 2003, the Company produced, as
planned, a total of 145,000 ounces of palladium and platinum
compared to 165,000 ounces for the second quarter of 2002.  The
decrease is a result of a 22% decrease in production at the
Stillwater Mine over 2002 and the contribution of 40,000 ounces
from the East Boulder Mine, a 29% increase from 2002 levels and
a 11% increase in production from the first quarter of 2003.
Realized prices per ounce for the second quarter 2003 were $341
for palladium, and $565 for platinum, compared to $442 and $511,
respectively, in the second quarter of 2002.  The Company's
average realized combined price per ounce of palladium and
platinum for the second quarter of 2003 was $391 or about 40%
above the combined market price per ounce of $280.

Total cash costs on a consolidated basis for the second quarter of
2003 were $281 per ounce compared to $270 per ounce for the same
period in 2002. The $11 per ounce increase is due to a $9 per
ounce increase in operating costs primarily related to lower
production and higher mining costs per ounce at the Stillwater
Mine and a $2 per ounce increase in royalties and taxes. Total
consolidated production costs per ounce produced in the second
quarter of 2003 increased $21, or 6%, to $354 from $333 as
compared to the same period of 2002.  The increase is due to the
increase in operating costs and an increase in depreciation and
amortization costs of $10 per ounce, primarily related to a higher
fixed asset base and changes in reserve estimates used in
calculating depreciation and amortization which occurred in the
second quarter of 2002.

For the first six months of 2003, the Company produced 291,000
ounces of palladium and platinum compared to 331,000 ounces for
the six months of 2002. Realized prices per ounce for the first
half of 2003 were $353 for palladium, and $572 for platinum,
compared to $449 and $502, respectively, for the same period of
2002.  The Company's average realized combined price per ounce of
palladium and platinum was $401 per ounce for the first six months
of 2003 or about 29% higher than the combined market price of $311
per ounce.

Total consolidated cash costs per ounce for the first half of 2003
were $281 compared to $269 for the same period of 2002.  Again,
the higher cash costs are attributable to a $12 per ounce increase
in operating costs primarily related to higher mining costs per
ounce at the Stillwater Mine as a result of lower production
ounces due to the Company transitioning to its new long-range
operating plan.  Total consolidated production costs per ounce
produced increased $23, or 7%, to $352 from $329 in the first half
of 2003 as compared to the same period of 2002.  The increase is
due to the increase in operating costs and an increase in
depreciation and amortization costs of $11 per ounce, primarily
related to a higher fixed asset base and changes in reserve
estimates used in calculating depreciation and amortization which
occurred in the first half of 2002.

                        STILLWATER MINE

As a result of a 16% planned decrease in tonnage milled at the
Stillwater Mine, palladium and platinum production was 105,000
ounces in the second quarter of 2003 compared to 134,000 ounces in
the second quarter of 2002. During the quarter, a total of 200,000
tons were milled with a combined mill head grade of 0.58 ounce per
ton compared to 247,000 tons with a combined mill head grade of
0.60 ounce per ton in the second quarter of 2002 as the mine
implements a long-range operating plan which changes the mine's
plan from a production-driven to a cost-driven emphasis.  The
mining rate during the second quarter remained consistent with the
first quarter at approximately 2,033 tons of ore per day.

For the first six months of 2003 the mine produced 215,000 ounces
of palladium and platinum compared to 277,000 ounces for the first
six months of 2002.  Again, the lower production was the result of
a 20% planned decrease in mill throughput combined with a 3%
decrease in the average combined mill head grade for the
comparable period.

Total cash cost per ounce for the second quarter of 2003 increased
to $262 from $247 for the same period in 2002 due to the lower
production rates and higher royalties and taxes.  Total
consolidated production costs per ounce produced in the second
quarter 2003 increased $25, or 8%, to $325 from $300 as compared
to the same period of 2002.  The increase is due to the increase
in operating costs and an increase in depreciation and
amortization costs of $10 per ounce, primarily related to a higher
fixed asset base and changes in reserve estimates used in
calculating depreciation and amortization which occurred in the
second quarter of 2002.

For the first six months of 2003, total cash cost per ounce
increased to $257 from $245 for the same period in 2002 due to
lower the lower production levels.  Total consolidated production
costs per ounce produced increased $22, or 7%, to $318 from $296
in the first half of 2003 as compared to the same period of 2002.
The increase is due to the increase in operating costs and an
increase in depreciation and amortization costs of $10 per ounce,
primarily related to a higher fixed asset base and changes in
reserve estimates used in calculating depreciation and
amortization which occurred in the first half of 2002.

During the second quarter of 2003 capital expenditures at the mine
were $9.1 million bringing year-to-date capital spending to $19.5
million.

                        EAST BOULDER MINE

During the second quarter of 2003, the East Boulder Mine produced
40,000 ounces of palladium and platinum, an 11% increase from the
first quarter of 2003 and a 29% increase compared to the 31,000
ounces produced in the second quarter of 2002.  The mining rate
continues to be increased and averaged 1,319 tons of ore per day
for the quarter.  A total of 120,000 tons of ore were milled with
a mill head grade of 0.38 ounce per ton in the second quarter of
2003 compared to 105,000 tons with a mill head grade of 0.34 ounce
per ton for the comparable quarter last year.

During the second quarter of 2003, East Boulder made modifications
to its 2003 operating plan to convert to a more selective mining
method enabling the mine to use smaller equipment.  The smaller
equipment was acquired from the Stillwater Mine and is currently
being rebuilt.  In part, this change could be accomplished due to
the fact the sand plant operation has steadily improved its sand
recovery and operating efficiency.  Benefits from these changes
should be seen in the fourth quarter of this year.  Several other
infrastructure construction projects were completed during the
quarter including a major ventilation change.  Capital
expenditures at the mine for second quarter were $2.7 million
bringing year-to date capital spending to $6.8 million.

For the first six months of 2003 the mine produced 76,000 ounces
of palladium and platinum compared to 54,000 ounces for the first
six months of 2002.  The increase in production is the result of
ramping up production at the facility.

Total cash costs per ounce in the second quarter of 2003 decreased
$34, or 9%, to $330 compared to $364 per ounce for the same period
in 2002 due to the higher production rates and lower operating
costs.  This was an 11% improvement from the first quarter of
2003.  Total consolidated production costs per ounce produced in
the second quarter 2003 decreased $42, or 9%, to $428 from $470 as
compared to the same period of 2002.  The decrease is due to the
lower operating costs as a result of the higher production rate
and a decrease in depreciation and amortization costs of $8 per
ounce.

For the first six months of 2003, total cash costs per ounce
decreased $39, or 10%, to $350 from $389 for the same period in
2002 due to the higher production levels and higher grades.  Total
consolidated production costs per ounce produced decreased $47, or
9%, to $448 from $495 in the first half of 2003 as compared to the
same period of 2002.  The decrease is due to lower operating costs
as a result of the higher production rate and a decrease in
depreciation and amortization costs of $8 per ounce.

                             FINANCES

Revenues were $58.9 million for the second quarter of 2003
compared with $75.0 million for the second quarter of 2002, a 22%
decrease, which is the result of a 15% decrease in combined
realized palladium and platinum prices and a 9% decrease in the
quantity of metal sold.  For the first half of 2003 revenues were
$121.5 million compared with $151.0 million for the first half
of 2002, a 20% decrease, which is the result of a 13% decrease in
combined realized palladium and platinum prices and a 8% decrease
in the quantity of metal sold.

Net cash provided by operations for the second quarter 2003, was
$12.7 million compared to $7.3 million for the comparable period
of 2002, an increase of $5.4 million.  The increase was primarily
a result of changes in net operating assets and liabilities of
$23.0 million, an increase in non-cash expenses of $12.7 million,
offset by a decrease in net income of $30.3 million.

For the first six months ended June 30, 2003, net cash provided by
operations was $36.0 million compared to $26.8 million for the
same period of 2002, an increase of $9.2 million.  The increase
was primarily a result of changes in net operating assets and
liabilities of $39.8 million; an increase in non-cash expenses of
$18.0 million offset by a decrease in of net income of $48.6
million.

Capital expenditures totaled $11.7 million in the second quarter
of 2003, which includes $10.2 million incurred in connection with
capitalized mine development activities, compared to a total of
$11.8 million, which included $10.7 million incurred in connection
with capitalized mine development activities in the same period of
2002.

For the first six months of 2003, capital expenditures totaled
$26.2 million, which includes $22.3 million incurred in connection
with capitalized mine development activities, compared to $23.2
million, which included $22.1 million incurred in connection with
capitalized mine development activities in the same period of
2002.

During the second quarter of 2003, the Company made $50 million in
principal payments on the Company's debt, repaying the Term A loan
facility in full, as required under the facility upon the closing
Norilsk Nickel transaction.  Currently, the Company has $129.1
million outstanding under its term loan facilities bearing
interest at 7.25% and $7.5 million outstanding as letters of
credit under the revolving credit facility.

At June 30, 2003, the Company's cash and cash equivalents
increased by $40.4 million to $66.3 million, and $17.5 million was
available to the Company under its revolving credit facility.  The
Company's working capital at June 30, 2003 was $157.6 million,
compared to $46.7 million at December 31, 2002. The ratio of
current assets to current liabilities was 2.4 at June 30, 2003,
as compared to 1.7 December 31, 2002.

                        METALS MARKET

During the second quarter of 2003 palladium traded as high as $194
per ounce and as low as $148 per ounce and the average market
price was $170 per ounce in the second quarter, while platinum
traded as high as $685 per ounce and as low as $603 per ounce and
the average market price was $646 per ounce.

Palladium continued its downward trend in the beginning of the
second quarter but gained some momentum and strength mid-quarter
as a major auto producer announced they were looking at using more
palladium for the production of their autocatalysts.

The combined average market price per ounce of palladium and
platinum for the second quarter of 2003 was $280 compared to $398
for the second quarter of 2002.  The combined average market price
for the two metals for the first six months of 2003 was $311 per
ounce compared to $404 per ounce for the same period in 2002.

                        OTHER MATTERS

On June 16, 2003, the Company held a special meeting of
stockholders to consider the Norilsk Nickel transaction.  A total
of 27,315,054 shares, or 62.2% of the outstanding shares of the
Company were represented at the meeting.  Approximately 82.9% of
the votes cast at the special meeting voted in favor of the
transaction, 22,320,960 shares voted for the transaction,
4,589,104 against it and 404,990 shares abstained from voting.
The transaction closed on June 23, 2003 and immediately following
the closing, Norimet owns approximately 50.8% of the Company's
outstanding shares.

On July 22, 2003, Norimet commenced a cash tender offer to acquire
up to 4,350,000 shares of Stillwater at $7.50 per share.  The
Board of Directors of Stillwater has stated that it has taken no
position regarding whether or not stockholders should tender their
shares into the offer.  Questions regarding the tender offer, or
requests for tender offer materials, should be directed to D.F.
King & Co., Inc., at 800-714-3313.  This additional share purchase
could increase Norimet's ownership in Stillwater to approximately
56%.

Stillwater Mining Company (S&P/BB+ Corporate Credit/Developing) is
the only U.S. producer of palladium and platinum and is the
largest primary producer of platinum group metals outside of South
Africa.  The Company's shares are traded on the New York Stock
Exchange under the symbol SWC.  Information on Stillwater Mining
can be found at its Web site: http://www.stillwatermining.com


TELEMARK INC: Canadian Receiver Solicits Bids for Retail Assets
---------------------------------------------------------------
Schwartz Levitsky Feldman Inc., as Court-appointed Receiver and
Manager of Telemark, Inc., is soliciting offers for the purchase
of the Receiver's right, title and interest, if any, in the assets
of the company.

Telemark Inc. is a Canadian retailer that operates under a
trademarked name, Showcase.  Products sold, range from sports and
fitness to health and beauty to kitchen appliances.  There are
currently 25 corporately-owned stores and 7 franchised stores
which the Receiver and manager may have an interest.

Offers must be addressed to:

        Schwartz Levitsky Feldman Inc.
        1167 Caledonia Road
        Ontario, M6A 2XI
        Attn: James Graham, Esq.

and received before 5:00 p.m. on July 31, 2003.


TEXAS PETROCHEMICAL: Wants Nod to Use Lenders' Cash Collateral
--------------------------------------------------------------
Texas Petrochemicals LP and its debtor-affiliates ask for an
authority from the U.S. Bankruptcy Court for the Southern District
of Texas for an emergency use of cash collateral to finance the
ongoing operation of their businesses.  Additionally, the Debtors
wish to grant adequate protection to the creditors, which assert
as interest in the Cash Collateral. The Debtors require the use of
cash generated from their operations in order to continue to
operate their business, to maintain going concern value of the
business and to ensure that adequate funds are available for
normal and customary business expenses and operating needs.

The Debtors report that participants in the Revolving Credit
Facility syndicate led by Bank of America, as agent, assert a
first priority security interest in the accounts receivable and
inventory, and a second priority security interest in the fixed
assets.  Also, participants in the Term Loan syndicate led by
Credit Suisse First Boston, as agent, assert a first priority
security interest in the fixed assets of Debtors and a second
priority security interest in the accounts receivable and
inventory

The Debtors believe that the Secured Creditors are adequately
protected for the use of the Cash Collateral in that the orderly
liquidation value of the Secured Creditors' collateral in net
accounts receivable and inventory exceeds $77 million, plus their
collateral value in property, plant & equipment exceeds $160
million, for a total collateral value exceeding $237 million.

As of the Petition Date, the Secured Creditors' debt was $43
million under the Revolving Credit Facility and $56 million under
the Term Loan, for a total of $99 million. Therefore, the Secured
Creditors have an "equity cushion" in excess of $138 million.

In their use of the Secured Creditors' cash collateral, the
Debtors intend to provide further adequate protection to the
Secured Creditors by providing postpetition replacement liens in
accounts receivable and inventory, including Cash Collateral
generated or received by the Debtors subsequent to the Petition
Date, but only to the extent the Secured Creditors had valid,
perfected prepetition liens and security interests.

The Debtors submit that there exists an immediate need for the
Debtors to obtain approval of the use of Cash Collateral in order
to pay payroll, rent, utilities, vendors and other ongoing
expenses in the ordinary course of business, as identified on the
interim budget:

                            7/21      7/28      8/4
                            ----      ----      ---
    Beginning Cash             0      20,807   15,102
    Total Receipts        32,995       6,771   11,077
    Total Disbursements   12,187      12,477   13,328
    Net Cash Flows        20,807      (5,706)  (2,251)
    Ending Cash           20,807      15,102   12,851

Without the immediate use of the Cash Collateral for an interim
period, the Debtors' ability to operate their business will be
severely impaired. Without the use of Cash Collateral, the Debtors
will have to close their business. Obviously this would have a
severe negative impact upon the Debtors' going concern value and
ability to successfully create value for all creditors. A complete
shutdown of the Debtors' business, even for a short period, would
result in the loss of employees, the Secured Creditors receiving
substantially less from their collateral and the unsecured
creditors having no hope of receiving any distribution in these
cases.

Texas Petrochemicals LP, headquartered in Houston, Texas, along
with its debtor-affiliates, are one of the largest producers of
butadiene, butene-1 and third largest producer of methyl tertiary-
butyl ether in North America. The Company filed for chapter 11
protection on July 20, 2003 (Bankr. S.D. Tex. Case No. 03-40258).
Mark W. Wege, Esq., at Bracewell & Patterson, LLP represents the
Debtors in their restructuring efforts.  When the Company filed
for protection from its creditors, it listed $512,417,000 in total
assets and $448,866,000 in total debts.


TRANSDIGM: Completes Merger Transaction with Warburg Pincus Unit
----------------------------------------------------------------
TransDigm Holding Company announced that on July 22, 2003, it
closed its previously announced merger with TD Acquisition
Corporation, an affiliate of Warburg Pincus Private Equity VIII,
L.P.  As a result of the merger, TransDigm Holding Company became
a wholly-owned subsidiary of TD Holding Corporation, a new holding
company controlled by Warburg Pincus.

TransDigm Holding Company also announced the successful completion
of TransDigm Inc.'s tender offer for its outstanding 10.375%
Senior Subordinated Notes due 2008 and the related consent
solicitation, as further detailed in TransDigm Inc.'s Offer to
Purchase, dated June 23, 2003. The offer expired at midnight, New
York City time, on Monday, July 21, 2003. TransDigm Inc. was
informed by the depositary for the tender offer that $197,750,000
of the $200,000,000 of outstanding Notes were validly tendered. On
Tuesday, July 22, 2003, TransDigm Inc. accepted for payment all
validly tendered Notes and made payment to the depositary for the
accepted Notes. Any Notes not validly tendered in the tender offer
were defeased pursuant to the terms of the indenture governing the
Notes.

W. Nicholas Howley, Chairman, President & Chief Executive Officer
of TransDigm stated, "The entire management team of TransDigm is
excited about the opportunity to continue to grow and improve our
business with the support of Warburg Pincus, our new partner."

TransDigm is a leading manufacturer of highly engineered component
products for the commercial and military aerospace industries. The
company sells its products to commercial OEM and aftermarket
customers. TransDigm's major product lines include gear pumps,
igniters and ignition systems, electromechanical actuators and
controls, NiCad batteries/chargers, engineered connectors,
lavatory components, and engineered latches.

Warburg Pincus LLC is a leading global private equity firm, which
has invested more than $15 billion in over 450 companies in 29
countries since 1971. The firm currently has approximately $8
billion under management and $6 billion available for investment
globally in a range of sectors including industrials and
chemicals, energy and natural resources, financial services and
technologies, healthcare and life sciences, information and
communications technology, media and real estate.

TransDigm is a leading manufacturer of highly engineered component
products for the commercial and military aerospace industries. The
company sells its products to commercial OEM and aftermarket
customers. TransDigm's major product lines include gear pumps,
igniters and ignition systems, electromechanical actuators and
controls, NiCad batteries/chargers, engineered connectors,
lavatory components, and engineered latches.

As reported in Troubled Company Reporter's July 2, 2003 edition,
Standard & Poor's Ratings Services affirmed its ratings, including
the 'B+' corporate credit rating, on TransDigm Inc., and removed
them from CreditWatch where they were placed on March 18, 2003.
The outlook is stable.

At the same time, Standard & Poor's assigned its 'B+' rating to
the company's new $440 million secured credit facility and its 'B-
' rating to the proposed $300 million senior subordinated notes
due 2011 to be sold under Rule 144A with registration rights.
TransDigm is being acquired by Warburg Pincus LLC and TransDigm's
senior management for a reported $1.1 billion through a leveraged
buyout.


TRITON PCS: Appoints Glen Mella as Senior VP Marketing & Sales
--------------------------------------------------------------
Triton PCS (NYSE: TPC) has appointed Glen D. Mella to the position
of Senior Vice President of Marketing and Sales, effective August
11th.

Mella joins Triton PCS from New York-based CRS Retail Systems, a
leading provider of point-of-sale and multi-channel software to
the retail industry, where he served as president of the Corporate
Systems Group.  Prior to that, he was president and chief
executive officer of Found Inc., a software company based in Salt
Lake City that was acquired by CRS Retail Systems in October 2002.

He previously served as senior vice president of marketing and
business development for TenFold Corp. of Salt Lake City, where he
was a member of the executive team that led the software company
from early stage development through a successful initial public
offering.  Prior to that, Mella served as general manager/vice
president of marketing at Novell Inc., as director of marketing at
Dial Corp. and as product manager at Frito-Lay/PepsiCo.

"Glen is a seasoned senior executive who brings management
expertise ranging from marketing and brand management with some of
the largest corporations in the country to successful
entrepreneurial skills as a chief executive of an enterprise
software company," said Michael E. Kalogris, Triton PCS chairman
and chief executive officer.  "His classic brand management and
entrepreneurial skills will further enhance our senior management
team as our company continues to grow and develop in an ever-
changing environment."

Triton PCS, based in Berwyn, Pennsylvania and whose March 31, 2003
balance sheet shows a total shareholders' equity deficit of about
$192 million, is an award-winning wireless carrier providing
service in the Southeast.  The company markets its service under
the brand SunCom, a member of the AT&T Wireless Network.  Triton
PCS is licensed to operate a digital wireless network in a
contiguous area covering 13.6 million people in Virginia, North
Carolina, South Carolina, northern Georgia, northeastern Tennessee
and southeastern Kentucky.

For more information on Triton PCS and its products and services,
visit the company's Web sites at: http://www.tritonpcs.comand
http://www.suncom.com


TRUDY CORP: Net Capital Deficit Raises Going Concern Uncertainty
----------------------------------------------------------------
Trudy Corporation and a subsidiary designs, manufactures and
markets plush stuffed animals and publishes children's books and
audiobooks for sale to both retail and wholesale customers, both
domestically and internationally. The Company's product is sold
under the trade names of both Soundprints and Studio Mouse, LLC.

The Company continues to experience a working capital deficiency
and negative cash flow as it has staffed up to support future
sales growth to a level that it anticipates to achieve
profitability. While the Company has made considerable progress
since the 2001 recapitalization, it has been difficult to meet its
financial obligations as they become due, barring the receipt of
an asset based line of credit from a commercial lending
institution. In the fiscal year ended March 31, 2002, the Company
received two six month term loans of $475,000 and $300,000 from a
local bank, both of which were paid back as of July 24, 2002.

For the fiscal year ended March 31, 2003 the Company borrowed
$1,331,000 from two principal shareholder/officers. The Company
used the funds to pay its vendors, to cover a significant bad
debt, and to finance the spring 2003 backlog of $873,141. The
Company's backlog on June 30, 2003 was $503,803. On March 3, 2003,
the Company executed an engagement letter with Delta Capital
Group, LLC to provide assistance in seeking and securing financing
and exploring strategic options.

For the year ended March 31, 2003 one principal
shareholder/officer was repaid $169,434 relating to pre-existing
loans. Subsequent to March 31, 2003, this principal
shareholder/officer was repaid $31,000 relating to pre-existing
loans. As the Company continues to source products with new
vendors in order to lower its product costs, it has done so at
unfavorable credit terms in order to secure lower pricing for its
books and plush. These vendors require payment terms.

The Company's ultimate ability to continue as a going concern is
dependent upon the market acceptance of its products, an increase
in revenues coupled with continuing licensing support from its
primary licensor, the Smithsonian Institution, and positive cash
flow. The Company believes that continued improvement in its sales
and its ability to borrow money from its principal
shareholder/officer, will be sufficient to allow the Company to
continue in operation.

On June 13, 2003, Abrams and Company, P.C., of Melville, New York,
Trudy Corporation's independent auditors, said, in the Auditors
Report to the Board of Directors: "[T]he Company has suffered
recurring losses from operations and has a deficiency in net
assets. Such factors raise substantial doubt about the Company's
ability to continue as a going concern."


UNIFORET: Canadian Court Nixes Leave to Appeal May 16 Decision
--------------------------------------------------------------
Uniforet Inc., and its subsidiaries, Uniforet Scierie-Pate Inc.
and Foresterie Port-Cartier Inc., announced that the Court of
Appeal has dismissed the motion presented by a group of US
Noteholders seeking leave to appeal the judgment rendered by the
Superior Court of Montreal on May 16, 2003, which judgment has
sanctioned and approved their plan of arrangement under the
Companies' Creditors Arrangement Act.

The Company intends to proceed immediately with the implementation
of its plan of arrangement and will have a new press release
issued once the effective date of implementation of its plan will
have been fixed.

Uniforet Inc. manufactures softwood lumber. It carries on its
business through mills located in Port-Cartier and in the
Peribonka area. Uniforet Inc.'s securities are listed on the
Toronto Stock Exchange under the trading symbol UNF.A for the
Class A Subordinate Voting Shares, and under the trading symbol
UNF.DB for the Convertible Debentures.


UPC POLSKA: Secures Blessing to Sign-Up FTI for Financial Advice
----------------------------------------------------------------
UPC Polska, Inc., sought and obtained approval from the U.S.
Bankruptcy Court for the Southern District of New York to retain
FTI Consulting, Inc., as its Financial Advisor.

The Debtor retained FTI prepetition to assist in the structuring
and implementation of the Restructuring Agreement and, ultimately,
the Plan.  In providing this advice, FTI has become well
acquainted with the Debtor's business, capital structure,
creditors and other related matters, which experience and
expertise will assist FTI in providing effective and efficient
services to the Debtor in this case. Should the Court approve the
Debtor's retention of FTI as financial advisor, FTI will continue,
without interruption, to perform similar services for the Debtor
as FTI performed prior to the Petition Date.

FTI will:

     a) prepare a report on the valuation of the Company as of
        December 31, 2002;

     b) prepare a liquidation analysis of the Company;

     c) attend meetings of management and counsel related to the
        reorganization effort as deemed necessary by the
        Company;

     d) present FTI's views in a PowerPoint presentation or
        other writing regarding the Company's contemplated
        restructuring and valuation to the Company's Board of
        Directors on a conference call and address
        telephonically the comments of the Board of Directors,
        if any.

     e) advise the Company with respect to the formulation of a
        potential "Recapitalization Plan." As used herein, a
        "Recapitalization Plan" means a plan compiled in
        conjunction with the Company, certain of the Company's
        bondholders and UPC Telecom B.V., which is the Company's
        largest creditor and sole shareholder, that provides for
        the restructuring, refinancing, retirement or repurchase
        in connection with a bankruptcy reorganization of the
        Company of some or all of the Company's long-term
        indebtedness for borrowed money including, without
        limitation, the Company's publicly traded debt
        instruments and the Company's indebtedness to its
        affiliates;

     f) advise the Company with respect to strategies by which a
        Recapitalization Plan may be implemented and assisting
        the Company in connection with such implementation;

     g) advise the Company on tactics and strategies for
        negotiating with its various groups of creditors in
        connection with the development of any Recapitalization
        Plan;

     h) advise the Company on the timing, nature, and terms of
        issue of any new securities or of other consideration or
        inducements to be offered pursuant to any
        Recapitalization Plan;

     i) coordinate, and assist as necessary in the preparation
        of reports and filings and the presentation of
        testimony, in bankruptcy court or any other court or as
        requested by the Office of the United States Trustee,
        including monthly operating reports, Statements of
        Assets and Liabilities and Statements of Financial
        Affairs, and make available its staff and others who
        perform services for the Debtor for purposes of
        discovery or any judicial hearing required in connection
        with any Recapitalization Plan or any Recapitalization
        Transaction;

     j) coordinate, and assist as necessary in the preparation
        and review of financial information for distribution to
        the creditors and/or other parties-in-interest in any
        Recapitalization Transaction, such as cash receipts and
        disbursements analyses;

     k) coordinate, and assist as necessary in the preparation
        of financial information and documents necessary for
        confirmation of any Recapitalization Plan and any
        Recapitalization Transaction, including information to
        be contained in the Disclosure Statement, and the
        presentation of testimony related thereto.

     l) if requested by the Company, review and analyze the
        Company's business, operations and financial projections
        and provide a valuation of the Company after giving
        effect to any contemplated Recapitalization Plan to be
        described in a Plan of Reorganization and a Disclosure
        Statement; and

     m) render such other general business consulting or such
        other assistance as the Debtor or its counsel may deem
        necessary that are consistent with the role of a
        financial advisor and not duplicative of services
        provided by other professionals in this proceeding.

Kevin Lavin, Senior Managing Director of FTI Consulting, tells the
Court that his firm charges by the hour for its services at these
customary rates:

     Senior Managing Director             $550 to $625
     Managing Director/Director/Manager   $395 to $550
     Associates/Sr. Associates            $195 to $365
     Administrative/Paraprofessional      $ 75 to $160

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.


US AIRWAYS: Resolves Claim Dispute with Allegheny County Airport
----------------------------------------------------------------
US Airways, Allegheny County and the Allegheny County Airport
Authority reached a consensual agreement resolving and releasing
all bankruptcy claims filed by the County and the Authority
against US Airways with regard to Pittsburgh International
Airport.

The agreement resolves all claims, including claims relating to
the rejections of the Airline Operating Agreements and other
related Terminal Lease Agreements.

Under the agreement, in exchange for the release of claims, the
Airport Authority and Allegheny County will be granted an allowed
general unsecured claim in the amount of $211 million in the US
Airways bankruptcy case. These claims will share, with claims of
other unsecured creditors, in distributions of US Airways Group,
Inc. equity under the company's plan of reorganization.

"We are pleased to have cooperatively resolved these issues. Now
we can focus more of our attention on reaching an amicable
agreement with the State of Pennsylvania and Allegheny County to
find a way for us to profitably retain our Pittsburgh hub," said
US Airways President and Chief Executive Officer David N. Siegel.

"Resolution of this issue demonstrates the ability of the
Allegheny County Airport Authority and the County to work together
towards a positive outcome, allowing us to now concentrate on
reaching a satisfactory agreement with US Airways in regards to
the governor's Pennsylvania Plan," said Allegheny County Chief
Executive Jim Roddey.


US AIRWAYS: Asks Court to Establish Distribution Reserve
--------------------------------------------------------
US Airways Group asks Judge Mitchell to establish a Distribution
Reserve.  The Reserve will be formed by estimating unliquidated
and contingent claims and approving amounts placed into the
Distribution Reserve for other disputed claims.

John Wm. Butler, Jr., Esq., at Skadden, Arps, Slate, Meagher &
Flom, explains that a Distribution Reserve is required to
administer the Debtors' estates, implement the Plan and provide
for the timely distribution of New Equity to holders of Allowed
Claims.  The Distribution Reserve is a prerequisite to any
distribution under the Plan.  Therefore, it is imperative that
the Reserve be established as soon as possible so that the
Reorganized Debtors can make distributions to Unsecured Creditors
by the targeted date of July 31, 2003.

To calculate the Distribution Reserve, the Reorganized Debtors
identified 869 disputed claims that fall into two categories:

    (a) Claims requiring estimation; and

    (b) Other Disputed Claims for which amounts are being placed
        into the Distribution Reserve.

The Reorganized Debtors have reviewed each Claim and estimated a
range of potential liability.  The Court should estimate each
Claim at the maximum liability.

If the Disputed Claims become Allowed Claims, distributions will
be made from the Distribution Reserve.  Any surplus that remains
in the Distribution Reserve after all disputed claims have been
resolved will be distributed pro rata to Allowed General
Unsecured Claimholders.

                        Summary of Claims

         Debtor                          Estimated Amount
         ------                          ----------------
         US Airways Group, Inc.              $138,102,448
         US Airways, Inc.                   2,877,568,665
         Allegheny Airlines, Inc.              13,664,573
         Piedmont Airlines, Inc.               33,734,633
         PSA Airlines, Inc.                     2,410,703
         MidAtlantic Airways, Inc.                      0
         US Airways Leasing & Sales, Inc.               0
         Material Services Company, Inc.           62,320
                                         ================
         Total                             $3,063,533,342

                            Objections

     1) Dawn Cowher & Kelly Cotter

Dawn Cowher & Kelly Cotter, former employees of Allegheny
Airlines, Inc., are involved in litigation entitled Cowher, et
al. v. Allegheny Airlines, Inc., 02-7029, 02-7047, presently
before the United States Court of Appeals for the Second Circuit.
The appeal has been fully briefed and only the rescheduling of
oral arguments remains.

Ms. Cowher and Ms. Cotter filed Claim Nos. 1777, 2020, 2029 and
2196 asserting contingent, unliquidated claims for
discrimination, damages and attorney's fees.  The Debtors
objected to the claims as contingent and unliquidated with an
estimated value of $0.

Ms. Cowher has a contingent and unliquidated claim estimated at
$250,000 plus attorney fees amounting to $165,855.  Ms. Cotter
has a contingent and unliquidated claim estimated at $300,000
plus attorney fees amounting to $104,071 and costs totaling
$32,058.

The Claimants ask the Court for a hearing to estimate the claims'
value.

     2) Lester Swafford

Prior to the Petition Date, Mr. Swafford sued the Debtors in
state court in Mecklenburg County, North Carolina, alleging that
he was wrongfully terminated as a maintenance supervisor.  Mr.
Swafford refused his supervisor's request to falsify an FAA
accident report involving damage to an airplane.  The Debtors
later learned that the account was true and a separate supervisor
then terminated both the dishonest supervisor and Mr. Swafford.

However, the Debtors did not reinstate Mr. Swafford, instead
claiming that it had eliminated the position due to the economic
impact of the September 11, 2001 terrorist attack.  S. Luke
Largess, Esq., at Ferguson, Stein, Chambers, Wallas, Adkins,
Gresharn & Surnter, alleges that the Debtors filled Mr.
Swafford's position with a much younger employee and have the
same number of Hub Maintenance Supervisors at its Charlotte
facility as prior to "9/11".

Mr. Swafford's claim involves the termination of long-term
employment in a well-paying position.  The termination severely
impacted his current and future income and retirement benefits.
To the extent that this state law tort claim is covered by one of
the Debtors' insurance policies, it should be exempted from a
distribution in the bankruptcy proceeding and instead be remanded
to the Superior Court in North Carolina.

     3) Frank Hicks

Frank Hicks asks Judge Mitchell for a hearing on the Debtors'
proposal to assign no value to his claim.

S. Luke Largess, Esq., at Ferguson, Stein, Chambers, Wallas,
Adkins, Gresharn & Surnter, relates that on the Petition Date,
Mr. Hicks was in litigation against the Debtors in federal court
for the Western District of North Carolina.  Mr. Hicks alleged
that he was denied reasonable accommodations in violation of the
Americans with Disabilities Act and was also the subject of
racial discrimination.

Mr. Hicks is an African-American and served over 20 years as a
flight attendant before suffering kidney failure.  He is
currently a candidate for a kidney transplant and must undergo
nightly peritoneal dialysis, preventing him from flying away from
home overnight.  Mr. Hicks applied and interviewed for a ground-
based position, but was passed over by a less qualified white
employee.  Mr. Hicks was then forced to take disability benefits.

According to Mr. Largess, the claim involves the termination from
long-term employment due to a disabling medical condition and
race discrimination.  The Debtors could have accommodated Mr.
Hicks in a well-paying, ground-based position, but instead
offered the job to less qualified white employees.  The Debtors'
intentionally discriminatory conduct has severely impacted Mr.
Hicks' income, retirement benefits and emotional condition.

To the extent that Mr. Hicks' claim is covered by the Debtors'
insurance policies, it should be remanded to the District Court
in the Western District of North Carolina.

     4) Guilford County

The Guilford County Tax Collector in North Carolina filed Proof
of Claim No. 4703 for $88,940 in ad valorem taxes.  The Debtors
objected to the Claim.

Kevin W. Whiteheart, Esq., Assistant County Attorney, relates
that the Reorganized Debtors maintain substantial operations and
equipment in Guilford County at the Piedmont Triad International
Airport, with approximately 32 flights originated daily.
Guilford County objects to the Debtors' estimation of its tax
claim at $0.

     5) Swissair

On behalf of Swissair and Swiss Air Transport Co., Ltd, William
Karas, Esq., at Steptoe & Johnson, tells the Court that
Swissair's Claim is being estimated at $0.  Swissair did not
receive proper notice of US Airways' case or the bar date.  Thus,
if the Debtors' request does not provide for a reserve that
adequately recognizes Swissair's claim, Swissair objects.

     6) Keystone Business Machines

Keystone Business Machines, Norman Volk, Nitrogenous Industries
Corp., and Nelson Chase are representatives of the Class
Plaintiffs in:

   a) Keystone Business Machines, Inc., et al. v. U.S. Airways
      Group, Inc., et al., Case No. 99-72988, United States
      District Court, Eastern District of Michigan;

   b) Norman Volk, et al. v. Delta Airlines, Inc., et al., Case
      No. 99-72987, United States District Court, Eastern District
      of Michigan; and

   c) Nelson Chase, et al. v. Northwest Airlines Corp., et al.,
      Case No. 96-74711, United States District Court, Eastern
      District of Michigan.

The Class Plaintiffs have filed claims in excess of
$3,000,000,000.  The claims are general unsecured claims treated
under the Plan as Class 6.  The claims are subject to an
objection by the Debtors.  The cases are also being litigated in
the Michigan District Court.  According to the Plan, once the
Distribution Reserve is established, no additional assets will be
available to pay claims in excess of the Debtors' estimations.

Geoffrey F. Avery, Esq., at Silverman & Morris, argues that the
Debtors do not have the authority to estimate the claims of
unsecured creditors.  Furthermore, Mr. Avery says, the Debtors'
request violates provisions of the Bankruptcy Code.  The Debtors
have also improperly valued the Class Plaintiffs' claims at zero.
To be safe, the Class Plaintiffs ask the Court to require the
Debtors to use the face value of claims to determine the
Distribution Reserve.

     7) Thomas Mutryn

Thomas A. Mutryn of Potomac, Maryland, former Vice President and
Chief Financial Officer of US Airways, Inc., objects to the
establishment of a Distribution Reserve because it does not
provide for his claim.  Mr. Mutryn filed a Proof of Claim on
October 28, 2002 for $725,969.

     8) Kreditanstalt fur Wiederaufbau and
        Wilmington Trust Company

Wilbur F. Foster, Jr., Esq., at Milbank, Tweed, Hadley & McCloy,
relates that KfW filed Proof of Claim No. 2514 for $429,000,000.
KfW's claims included $275,561,375 that was secured by 17 Fokker
F28 MK0100 airframes, related engines, records and documents.
Wilmington, as Security Trustee, filed Proof of Claim No. 2513
also asserting Fokker-related claims.

In late 2002, the Debtors abandoned the Fokker Aircraft.  On
December 20, 2002, Wilmington conducted a public auction of the
Fokker Aircraft, with the wining bidder paying $45,000,000.  The
proceeds from this disposition are to be applied first to cover
auction fees, costs and expenses and then to satisfy the Fokker-
related claims.  Any amounts that remain afterwards constitute
USAI-7 General Unsecured Claims.

Mr. Foster relates that the Debtors seek to have KfW's USAI-7
General Unsecured Claims estimated at $47,783,600.  This figure
is almost $200,000,000 lower than it should be.  Since auction
fees and expenses have not been accounted for yet, KfW's total
remaining claim should be estimated at $235,861,375.

     9) Limbach Company

Limbach Company objects to the Debtors' attempts to estimate its
claims at $0.

According to Robert King, Esq., at Reed Smith, Limbach is a
transferee of Claim No. 4389, as amended by Claim No. 5470, and
Limbach/Parker, is a transferee of Claim No. 4388, as amended by
Claim No. 5471, which were filed by Williard, Inc. and Williard,
Inc./Parker Associates, a Joint Venture.

The Claims total in excess of $14,823,042 for unpaid amounts owed
under contracts with USAI.  The Debtors objected to the Claims.
Until the Debtors' Objection is resolved, the amounts of the
Claims should be allowed as filed and should be included in full
in the Distribution Reserve.

     10) Robert Barnett

Robert Barnett was an employee of USAI who was wrongfully
terminated and was the target of disability-based discrimination
by USAI.  Due to the wrongful termination and discrimination, Mr.
Barnett has been damaged by USAI in excess of $2,698,140, alleges
Robert King, Esq., at Reed Smith.

Mr. Barnett filed Proof of Claim No. 4270 seeking recovery of the
full amount of his damages.  The Debtors objected to Mr.
Barnett's Claim.  Until the Objection is resolved, the full
amount of the Claim should be allowed as filed and should be
included in full in the Distribution Reserve.

     11) Goodrich Aviation Technical Services

Goodrich Aviation Technical Services contends that the Debtors'
request should be denied to the extent it seeks to reserve
nothing for its claim.  In the alternative, it should be approved
with a $92,655 reserve for Goodrich ATS, Daniel G. Grove, Esq.,
at Wolf, Block, Schorr & Solis-Cohen, says.

Richard F. Lareau and Blaine S. King also objected to the
Debtors' request. (US Airways Bankruptcy News, Issue No. 35;
Bankruptcy Creditors' Service, Inc., 609/392-0900)


US DATAWORKS: Board of Directors Adopts Shareholder Rights Plan
---------------------------------------------------------------
US Dataworks, Inc. (Amex: UDW) announced that its Board of
Directors has adopted a Stockholder Rights Plan.  Under the Rights
Plan, Rights will be distributed as a dividend at the rate of one
Right for each share of US Dataworks' common stock, held by
stockholders of record as of the close of business on September 2,
2003.

The Rights Plan is designed to enable US Dataworks' stockholders
to realize the full value of their investment and to provide for
fair and equal treatment for stockholders in the event that an
unsolicited attempt is made to acquire US Dataworks.  The adoption
of the Rights Plan is intended as a means to guard against abusive
takeover tactics.

The Rights will be distributed as a non-taxable dividend on shares
of Common Stock and will expire ten years from the date of
adoption of the Rights Plan.  The Rights will be exercisable only
if a person or group acquires 15 percent or more of US Dataworks'
common stock, subject to certain exceptions set forth in the
Rights Plan.  If a person acquires 15 percent or more of US
Dataworks' common stock while the Rights Plan remains in place,
all Rights holders, except the buyer, will be entitled to acquire
US Dataworks' common stock at a discount.  The effect will be to
discourage acquisitions of 15 percent or more of US Dataworks'
common stock in the absence of negotiations with the Board.

The Rights will trade with US Dataworks' common stock unless and
until they are separated upon the occurrence of certain future
events.  US Dataworks' Board of Directors may terminate the Rights
Plan at any time or redeem the Rights prior to the time a person
acquires 15 percent or more of US Dataworks' common stock.
Additional details regarding the Rights Plan will be outlined in a
summary to be mailed to all holders of Common Stock following
the record date, and a copy of the Rights Plan will be filed
shortly with the Securities and Exchange Commission.

Established in 1997, US Dataworks develops markets and supports
electronic check processing software and services for the
financial services industry. Its customer base includes many of
the largest financial institutions as well as credit card
companies and government institutions within the United States.
It also has a strategic alliance with Thomson Financial
Publishing, a unit of Thomson Corporation, to incorporate their
EPICWare database into US Dataworks products.  ZeroPass is a
trademark of US Dataworks.

For more information about US Dataworks, visit
http://www.usdataworks.com

US Dataworks' headquarters is located at 5301 Hollister Road,
Suite 250, Houston, TX  77040; telephone:  (713) 934-3855.

As reported in Troubled Company Reporter's June 25, 2003 edition,
the Audit Committee and the Board of Directors of US Dataworks
Inc. approved a change in the Company's independent accountants
for the fiscal year ending March 31, 2003 from Singer Lewak
Greenbaum & Goldstein LLP to Ham, Langston & Brezina, LLP.

As a result, US Dataworks informed Singer Lewak that, effective
June 11, 2003, they had been dismissed as its independent
accountants. The report of Singer Lewak for the fiscal years ended
March 31, 2002 and March 31, 2001, contained an explanatory
paragraph concerning US Dataworks' ability to continue as a going
concern.


VAIL RESORTS: Decentralizes Marketing and Sales Organization
------------------------------------------------------------
Vail Resorts, Inc. (NYSE: MTN) announced the restructuring of its
sales and marketing focus and organization. Due to the growing
number of resorts outside of Colorado, including Heavenly Resort,
the Grand Teton Lodge Company, seven RockResorts luxury resort
hotels, and the location of RockResorts and Vail Resorts Lodging
Company corporate offices in Denver, the Company will decentralize
most of its sales and marketing functions.

Each of the Company's five ski resorts already has in place an
existing on-site marketing chief. Similarly, the Grand Teton
Lodging Company, Vail Resorts Lodging Company in Denver, and the
various resort hotels have also traditionally had sales and
marketing executives in charge at each location. With this change
from a centralized to a decentralized focus, the decision-making
authority of the existing field marketing personnel will be
elevated. In addition, a smaller central marketing and sales
services group will remain in place to coordinate programs that
touch all of the various resorts and hotels.

Martin White, senior vice president of marketing for the Company,
participated fully in the decision-making process to decentralize
the organization. However, given the much broader scope of his
current duties, he and Richard Lesman, vice president of sales and
distribution, will vacate their positions with the Company in an
amicable parting.

Adam Aron, Chairman and Chief Executive Officer, commented, "After
much thoughtful discussion and analysis, we believe that with the
depth and strength of our existing resort-based staff, and the
growth and diversity of our travel businesses outside of Colorado,
it is both most effective and cost-efficient to decentralize the
marketing and sales functions within the company. Speed of
decision making will inevitably be enhanced in a decentralized
structure. Similarly, the complexities of intra-Company
communication will be lessened with a decentralized focus. Through
more local control, we believe this will allow each of our resorts
and reporting segments to more easily focus on those programs
which allow them to best and most appropriately market and sell
their respective products and services. At the same time, a key
core marketing and sales staff will remain in place to continue
its cutting edge implementation of marketing and sales programs
that cut across and benefit the various resorts and hotels."

He added, "Although the changing nature of our business, both
geographically and across different sectors of travel, has
suggested that we move to a decentralized approach, this in no way
reflects on the considerable achievements and contributions made
to Vail Resorts by Martin White and Richard Lesman. We greatly
value their accomplishments and will work fervently to continue
and build upon their various initiatives. Vail Resorts has been
widely viewed as having a highly professional marketing program,
and we have every intention of continuing in that tradition,
albeit with a different and more decentralized focus going
forward. Indeed, Vail Resorts revenues and business opportunities
have increased measurably over the past several years, and our
marketing and sales efforts have been an integral part of this
progress."

Vail Resorts, Inc. is the premier mountain resort operator in
North America. The Company's subsidiaries operate the mountain
resorts of Vail, Beaver Creek, Breckenridge and Keystone in
Colorado, Heavenly Resort in California and Nevada and the Grand
Teton Lodge Company in Jackson Hole, Wyoming. In addition, the
Company's RockResorts luxury resort hotel company, which it owns
in partnership with an affiliate of Olympus Real Estate Partners,
operates 10 resort hotels throughout the United States. Vail
Resorts Lodging Company, based in Denver, also manages numerous
resort hotels and condominiums. The Vail Resorts corporate Web
site is http://www.vailresorts.comand the consumer Web sites are
http://www.snow.comand http://www.rockresorts.com

Vail Resorts is a publicly held company traded on the New York
Stock Exchange (NYSE: MTN).

As reported in Troubled Company Reporter's May 19, 2003 edition,
Standard & Poor's Ratings Services assigned its 'BB-' rating to
Vail Resorts Inc.'s new $425 million credit facility consisting of
a $325 million revolving credit facility due May 2007 and a $100
million term loan B due November 2008.

At the same time, Standard & Poor's affirmed its 'BB-' corporate
credit rating on the company. Vail, Colorado-based ski resort
operator had $572.8 million of debt outstanding on Jan. 31, 2003.
The outlook is negative.


VANTAGEMED: Will Webcast Q2 Conference Call on August 8, 2003
-------------------------------------------------------------
VantageMed Corp. (OTC Bulletin Board: VMDC) announces the
following Webcast:

     What: VantageMed Corporation Q2 2003 Conference Call

     When: 08/08/03 @ 11:00 a.m. Eastern

     Where:

   http://www.firstcallevents.com/service/ajwz386512712gf12.html

     How: Live over the Internet -- Simply log on to the web at
          The address above.

     Contact: Liesel Loesch
              Controller
              Phone: 916-638-4744
              lloesch@vantagemed.com
              Fax: 916-526-4020

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.


WASHINGTON MUTUAL: Fitch Rates Class B-4 & B-5 Certs. at BB/B
-------------------------------------------------------------
Fitch rates WaMu Mortgage pass-through certificates, series 2003-
AR8 classes A, X, and R ($1.215 billion) senior certificates
'AAA'. In addition, the class B-1 certificate ($13,124,000) is
rated 'AA', the class B-2 certificate ($9,999,000) is rated 'A',
the class B-3 certificate ($4,999,000) is rated 'BBB', the class
B-4 certificate ($1,874,000) is rated 'BB', and the class B-5
certificate ($1,874,000) is rated 'B'. Class B-6 certificate
($3,129,033) is not rated by Fitch. The class B-4, B-5, and B-6
certificates are being offered privately.

The 'AAA' rating on senior certificates reflects the 2.80%
subordination provided by the 1.05% class B-1 certificate, the
0.80% class B-2 certificate, the 0.40% class B-3 certificate, the
0.15% privately offered class B-4 certificate, the 0.15% privately
offered class B-5 certificate, and the 0.25% privately offered
class B-6 certificate.

Fitch believes the above credit enhancement will be adequate to
support mortgagor defaults as well as bankruptcy, fraud and
special hazard losses in limited amounts. In addition, the ratings
reflect the quality of the mortgage collateral, strength of the
legal and financial structures, and Washington Mutual Mortgage
Securities Corp.'s servicing capabilities as master servicer.
Fitch currently rates Washington Mutual Bank, FA 'RMS2+' for
Master Servicing.

The mortgage loans provide for a fixed interest rate during an
initial period of approximately five years. Thereafter, the
interest rate will adjust annually based on the weekly average
yield on US Treasury Securities adjusted to a constant maturity of
one year (one-year CMT) plus a margin.

The trust is comprised of one group of 1,928 conventional, 30-year
5/1 hybrid adjustable-rate mortgage loans with an aggregate
principal balance of $1,249,964,133. The loans are secured by
first liens on residential properties. Approximately 82.0% of the
mortgage loans have interest only payments scheduled during the
initial 5-year period, with principal and interest payments
beginning on the first adjustment date. The average principal
balance as of the cut-off date is $648,321. The weighted average
loan-to-value ratio is 64.0% and the weighted average FICO score
is 745. Cash-out refinance loans represent 25.65% of the loan
pool. The states that represent the largest portion of the
mortgage loans are California (63.39%), Illinois (5.67%), and
Washington (4.45%).

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

The certificates are issued pursuant to a pooling and servicing
agreement dated July 1, 2003 among Washington Mutual Mortgage
Securities Corp., as depositor and master servicer, and Deutsche
Bank National Trust Company, as trustee. For federal income tax
purposes, elections will be made to treat the trust fund as two
Real Estate Mortgage Investment Conduits.


WEIRTON STEEL: Files Schedules & Statement in W. Virginia Court
---------------------------------------------------------------
In accordance with Section 521 of the Bankruptcy Code and Rule
1007 of the Federal Rules of Bankruptcy Procedure, Weirton Steel
delivered its Schedules of Assets and Liabilities and Statement
of Financial Affairs to the Bankruptcy Court on July 17, 2003.
The Debtor's Schedules and Statement will be summarized in
Weirton Bankruptcy News Issue No. 7.

At a glance, Weirton Steel reports $592,143,543 in total assets
and $477,461,193 in total liabilities.  Liabilities include
secured claims, unsecured priority claims and unsecured non-
priority claims.  Secured claims total $311,069,787 while
unsecured claims total $166,391,406. (Weirton Bankruptcy News,
Issue No. 6; Bankruptcy Creditors' Service, Inc., 609/392-0900)


WELLNESS PLAN: Gets R Fin'l Strength Rating over Rehabilitation
---------------------------------------------------------------
Standard & Poor's Ratings Services said that it assigned its 'R'
financial strength rating to The Wellness Plan after the Michigan
Office of Financial and Insurance Services approved an order to
put the company under rehabilitation, effective July 1, 2003.

Over the last five years, The Wellness Plan has reported net
losses of more than $42 million. In November 2001, the company's
poor financial condition prompted state regulators to put it under
supervision. "At that same time, Standard & Poor's lowered its
financial strength rating on the company to 'CCCpi' from 'Bpi',
citing the company's very weak earnings performance, very weak
capitalization, very weak liquidity, and steadily declining
enrollment," explained Standard & Poor's credit analyst James
Sung. "On March 17, 2003, Standard & Poor's withdrew the rating as
part of a larger effort to withdraw various public information
ratings."

The Wellness Plan, founded in 1972, is one of Michigan's largest
Medicaid HMOs. As of March 31, 2003, The Wellness Plan had 10,281
commercial members and 107,244 Medicaid members in Michigan.

An insurer rated 'R' is under regulatory supervision owing to its
financial condition. During the pendency of the regulatory
supervision, the regulators may have the power to favor one class
of obligations over others or pay some obligations and not others.
The rating does not apply to insurers subject only to nonfinancial
actions such as market conduct violations.


WESTPOINT STEVENS: Committee Hires Stroock & Stroock as Counsel
---------------------------------------------------------------
Peter Schweinfurth, Creditors' Committee Chairperson, recounts
that in May 2003, an informal committee comprised of ESL
Investments, GSC Partners, and Perry Strategic Capital Inc., who
together hold more than 51% of the WestPoint Stevens Debtors'
senior notes, was formed in anticipation of negotiating a
consensual restructuring of WestPoint Stevens' debts.  Stroock &
Stroock & Lavan, LLP served as counsel to the Informal Committee.
The Debtors and the Informal Committee reached an agreement in
principle concerning the terms of a restructuring transaction,
pursuant to which, among other things, ESL Investments, GSC
Partners and Perry Strategic Capital Inc. agreed to provide
standby commitments to purchase certain notes to be issued by the
reorganized debtors. The Standby Purchasers are members of the
Committee.  Stroock has been released as counsel to the Informal
Committee and the Standby Purchasers have retained separate
counsel to represent them in connection with these cases.

In connection with its work for the Informal Committee, Mr.
Schweinfurth relates that Stroock received a $75,000 advance
payment from Debtors.  Stroock has applied the advance payment
against certain fees and expenses incurred in connection with
prepetition services rendered to the Informal Committee.  Any
unpaid amounts for services rendered and expenses incurred by
Stroock in connection with its representation of the Informal
Committee are not obligations of the Debtors.  However, Stroock
may file an application with the Court seeking allowance of fees
and expenses for services rendered to the Informal Committee
during the period commencing on the Petition Date through the
formation of the Creditors' Committee pursuant to Section 503(b)
of the Bankruptcy Code.

By this application, the Official Committee of Unsecured
Creditors seek Judge Drain's permission to retain Stroock &
Stroock & Lavan LLP as its counsel in these Chapter 11 cases,
nunc pro tunc to June 10, 2003.

As counsel, Stroock is expected to:

    A. advise the Committee with respect to its rights, duties and
       powers in these Cases;

    B. assist and advise the Committee in its consultation with
       the Debtors relative to the administration of these cases;

    C. assist the Committee in analyzing the claims of the
       Debtors' creditors and the Debtors' capital structure and
       in negotiating with holders of claims and equity interests;

    D. assist the Committee in its investigation of the Debtors'
       acts, conduct, assets, liabilities and financial condition
       and operation of their businesses;

    E. assist the Committee in its analysis of, and negotiations
       with, the Debtors or any third party concerning matters
       related to, among other things, the assumption or rejection
       of certain leases of non-residential real property and
       executory contracts, asset dispositions, financing of other
       transactions and the terms of a plan(s) of reorganization
       for the Debtors and accompanying disclosure statements and
       related plan documents;

    F. assist and advise the Committee as to its communications to
       the general creditor body regarding significant matters in
       these Cases;

    G. represent the Committee at all hearings and other
       proceedings;

    H. review and analyze applications, orders, statements of
       operations and schedules filed with the Court and advise
       the Committee as to their propriety;

    I. assist the Committee in preparing pleadings and
       applications as may be necessary in furtherance of the
       Committee's interests and objectives; and

    J. perform any other legal services as may be required or are
       otherwise deemed to be in the interests of the Committee in
       accordance with the Committee's powers and duties as set
       forth in the Bankruptcy Code, Bankruptcy Rules or other
       applicable law.

Mr. Schweinfurth believes that Stroock has extensive knowledge
and expertise in the areas of law relevant to these Cases, and
that Stroock is well qualified to represent the Committee in
these Cases.  In selecting attorneys, the Committee sought
counsel with considerable experience in representing unsecured
creditors' committees in Chapter 11 reorganization cases, other
debt restructurings and textile matters.  Stroock has this
experience since the Firm is currently representing and has
represented official creditors' committees in many significant
Chapter 11 reorganizations, including Acme Metals, Inc.;
Barney's, Inc.; Best Products Co., Inc.; Burke Industries, Inc.;
Desa Holdings Corporation; Federated Department Stores, Inc.;
Formica Corporation; Galey & Lord; GenTek and Noma Company; Grand
Union Company; Levitz Furniture Incorporated; The LTV
Corporation; Northwestern Steel and Wire; Orion Pictures Com.;
The Resort at Summerlin; Venture Lighting International, Inc.;
Wheeling Pittsburgh; W.R. Grace & Co.; and Zale Corporation.

The Committee wants all legal fees and related costs and expenses
they incur on account of services rendered by Stroock in these
Cases to be paid as administrative expenses of the estates
pursuant to, among other things, Sections 330(a), 331 and 503(b)
of the Bankruptcy Code.  Stroock will charge for its legal
services on an hourly basis in accordance with its ordinary and
customary hourly rates in effect on the date the services are
rendered.  The current hourly rates charged by Stroock for
professionals and paraprofessionals employed in its offices are:

       Partners                           $500 - 750
       Special Counsel and Counsel         400 - 510
       Associates                          185 - 500
       Paraprofessionals                   150 - 245

These hourly rates are subject to periodic adjustments to reflect
economic and other conditions.  Stroock will maintain detailed
records of actual and necessary costs and expenses incurred in
connection with the legal services.

The names, positions and current hourly rates of the Stroock
professionals currently expected to have primary responsibility
for providing services to the Committee are:

    Lawrence M. Handelsman    Partner           $725
    Michael J. Sage           Partner            725
    Mark E. Palmer            Partner            625
    Shannon Lowry Nagle       Special Counsel    510
    Patty Perez               Associate          495
    Jonathan Gill             Associate          395
    Joshua Lefkowitz          Associate          320

Also, it will be necessary, from time to time, for other Stroock
professionals to provide services to the Committee.

Stroock Member Lawrence M. Handelsman assures the Court that the
Firm does not represent and does not hold any interest adverse to
Debtors' estates or their creditors in the matters on which
Stroock is to be engaged.  However, Stroock is a large firm with
a national and international practice and may represent or may
have represented certain of Debtors' creditors, equity holders,
affiliates or other parties-in-interest in matters unrelated to
these Cases. (WestPoint Bankruptcy News, Issue No. 5; Bankruptcy
Creditors' Service, Inc., 609/392-0900)


WORLD AIRWAYS: Reaches Tentative Pact with Flight Attendants
------------------------------------------------------------
World Airways (Nasdaq: WLDA) announced that Thursday night its
flight attendants, represented by the International Brotherhood of
Teamsters (Local 210), and the Company reached a tentative
agreement to extend the flight attendant collective bargaining
agreement.

The Company's flight attendants are subject to a collective
bargaining agreement that became amendable July 1, 2000, and both
sides have worked diligently over the last three years to reach a
new agreement.  The National Mediation Board has provided
mediation assistance for more than one year.

The new amendable date for the agreement will be August 31, 2006,
subject to ratification by the World Airways' flight attendants.
Ratification is expected by August 31, 2003.

Hollis Harris, chairman and chief executive officer of World
Airways, said, "This agreement reflects a great deal of effort on
the part of the flight attendants and the Company, and it is
positive for both parties.  We are pleased with the outcome, and
we now can put this behind us and focus on continuing to build a
strong and successful company."

Utilizing a well-maintained fleet of international range, wide-
body aircraft, World Airways, Inc. has an enviable record of
safety, reliability and customer service spanning more than 55
years.  The Company is a U.S. certificated air carrier providing
customized transportation services for major international
passenger and cargo carriers, the United States military and
international leisure tour operators.  Recognized for its modern
aircraft, flexibility and ability to provide superior service,
World Airways, Inc. meets the needs of businesses and governments
around the globe.  For more information, visit the Company's Web
site at http://www.worldair.com

World Airways Inc.'s March 31, 2003 balance sheet shows a working
capital deficit of about $22 million, and a total shareholders'
equity deficit of about $22 million.


WORLDCOM: CAGW Applauds Rep. Sweeney for Addressing MCI Bailout
---------------------------------------------------------------
Citizens Against Government Waste (CAGW) commended Rep. John
Sweeney (R-N.Y.) for offering an amendment to the fiscal 2004
Transportation and Treasury Appropriations Act calling for the
General Services Administration to decide by August 30 whether to
suspend MCI, formerly WorldCom, from receiving government
contracts as a result of the company's accounting fraud. The
amendment passed the House Appropriations Committee by a voice
vote.

"Hopefully this action by Congress will finally result in GSA
doing what is in the best interests of taxpayers by suspending MCI
from doing business with the federal government," CAGW President
Tom Schatz said. "The government should only award contracts to
reputable, law-abiding companies. Companies, such as MCI, that
have not shown exemplary behavior can not be trusted with taxpayer
dollars."

GSA has already initiated suspension proceedings against MCI at
the request of Senate Governmental Affairs Committee Chairman
Susan Collins (R- Maine). Since MCI announced its bankruptcy, the
government has provided more than $1.2 billion in business for the
company, including the renewal of a $17 million three-year
contract with the House of Representatives last week.

"While GSA took swift action to debar, or suspend, both Enron and
Arthur Andersen from government contracts, the agency failed to do
so when MCI went bankrupt and its executives were accused of
fraud," Schatz continued. "The consistent application of the
federal acquisition regulations requires the same result for all
three companies. Rep. Sweeney's amendment correctly questions
GSA's failure to debar MCI."

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.

"With the GSA having a firm deadline to conclude its
investigation, taxpayers are closer to learning whether the
federal government's hidden bailout of MCI is coming to an end,"
Schatz concluded. "GSA should disconnect MCI from government
contracts."

Citizens Against Government Waste is the nation's largest
nonpartisan, nonprofit organization dedicated to eliminating
waste, fraud, abuse, and mismanagement in government. For more
information, visit http://www.cagw.org


WORLDCOM INC: Hires Cushman & Wakefield as Real Estate Broker
-------------------------------------------------------------
Worldcom Inc., wants permission to employ Cushman & Wakefield,
Inc. as its real estate broker in connection with the sale of a
certain parcel of real property located at 901 Stewart Avenue in
Garden City, New York.

The Debtors seek to retain Cushman as their real estate broker
because, among other things, the Firm and its senior
professionals have extensive experience with, and recognized
expertise in, the sale of real property.  Cushman is well-
qualified to provide the services contemplated by the Agreement.

WorldCom Chief Financial Officer Victoria Harker informs the
Court that the Debtors currently own real property located at 901
Stewart Avenue, Garden City, New York.  The Debtors have
determined that they do not need the Property in their ongoing
business operations.  Thus, the Debtors decided to pursue the
sale of the Property.  Cushman worked with Hilco Real Estate,
LLC, the Debtors' real estate professional as the brokers for the
sale of the Property, and as a result of these efforts, succeeded
in negotiating a sale of the Property to 901 Stewart Partners,
LLC for $5,775,000, which represents the highest and best offer
received for the Property.  Specifically, pursuant to the
Agreement, Cushman made diligent efforts to consummate the sale
agreement for the Property.  In connection therewith, Cushman
has, among other things, provided these services to the Debtors:

      (i) provided background information on the market,
          competitive buildings and rent comparables for the
          Property;

     (ii) assisted the Debtors in the preparation of multiple
          replies to requests for information from the Purchaser,
          as well as multiple economic analyses based on changing
          criteria; and

    (iii) assisted the Debtors in negotiating and finalizing the
          sale.

Ms. Harker informs the Court that the Debtors will compensate
Cushman for professional services rendered under the Agreement
with a commission equal to 1.5% of the total sale price that
otherwise would have been paid to Hilco on the closing of the
sale of the Property, for a total payable of $86,625.  Because
Hilco has informed the Debtors that it has agreed to share the
commission to which it is entitled under its retention agreement
and the Order approving its retention, the retention of Cushman
will not cost the Debtors any additional amounts.

The Debtors believe that the fee structure is fair and reasonable
in that it does not require the Debtors to pay any additional
amount than they otherwise would have been obligated to pay, and
should be approved.  Additionally, the Debtors submit that the
fee structure is reasonable in light of:

      (i) industry practice,

     (ii) market rates charged for comparable services both in and
          out of the Chapter 11 context,

    (iii) the nature and scope of work performed by Cushman, and

     (iv) the successful results achieved directly as a result of
          Cushman's efforts.

Cushman Assistant Director of Finance and Administration Dennis
A. Waggner assures the Court that the Firm is a "disinterested
person" as that term is defined in Section 101(14) of the
Bankruptcy Code.  In addition, Cushman does not hold or represent
an interest adverse to the Debtors' estates that would impair the
Firm's ability to objectively perform professional services for
the Debtors.  However, Cushman has provided services in unrelated
matters to these entities: Citizens Communications Corp.,
Verizon, Sprint, AT&T, Teleport Communications, Time Warner
Communications, Compaq Computer Corp., Comsys, Nextel, BellSouth
Corp., Comsys, Nextel, BellSouth Corp., UFJ Bank Ltd., Deutsche
Bank, ABN Amro Bank NV, BNP Paribas, Credit Lyonnais, Bank One
NA, Royal bank of Scotland, Wells Fargo Bank, Qwest, AMR Corp.,
KDDI, RMH, JP Morgan Chase, Bear Sterns, State Street Bank, Bank
of New York, Bank of Nova Scotia, First Union Bank, Suntrust
bank, Prudential Insurance, Charles Schwab, PNC Bank, Morgan
Stanley Dean Witter, Lehman Bros., Salomon Smith Barney, Northern
Trust, AOL, Goldman Sachs, Bank of America, Chase Manhattan Bank,
Credit Suisse, Global Crossing, Intesabci, Oracle, PwC, Warburg
Dillon, and Westdeutsche. (Worldcom Bankruptcy News, Issue No. 32;
Bankruptcy Creditors' Service, Inc., 609/392-0900)


ZI CORPORATION: Names Michael Donnell New President & CEO
---------------------------------------------------------
Zi Corporation (Nasdaq: ZICA) (TSX: ZIC), a leading provider of
intelligent interface solutions, announced that veteran
telecommunications executive Michael D. Donnell, the former Chief
Executive Officer of Cellular One of San Francisco, has been named
President and Chief Operating Officer, effective immediately.
Donnell, 43, will report directly to Chairman and Chief Executive
Officer Michael E. Lobsinger.  He replaces Gary Kovacs, 40, who
successfully completed his contract with Zi and will pursue other
business opportunities.

At Zi, Donnell's immediate strategic focus will be on continuing
the growth of the Company's global customer base, increasing the
adoption of its technology and broadening the range of its
telecommunications products and services.

"We believe Zi is positioned for a bright future in the wireless
industry, and Mike is the type of leader and manager who can
fulfill that promise," Lobsinger said. "He has compiled an
exemplary record of achieving record growth and profitability in
the organizations he leads and is known for delivering the best
in value-added products and services to customers, creating
superior opportunities for employees and enhancing shareholder
value. Our product development roadmap under Mike's leadership,
combined with his understanding of the wireless carrier business
will ensure success in the execution of those plans.   Mike knows
the software technology business, which is our current focus, and
his experience, proven stewardship and network of carrier
relationships within the wireless industry will be a significant
benefit for Zi. This will assist us in our continued expansion
into the North American and European markets and continue our
solid growth in Asia and other emerging markets around the
globe."

Lobsinger added that "I'd like to thank Gary Kovacs, whose
leadership and dedication has been instrumental in helping drive
the growth of our core Zi Technology business. We wish him well in
his future endeavors."

Donnell has spent more than 18 years in senior management in the
wireless industry and since 2000, has operated a consultancy and
served as senior counsel to a number of leading wireless
infrastructure and software firms. In 1999 and 2000, Donnell was
CEO of Cellular One of San Francisco and under his leadership that
company became widely recognized for its superior combination of
growth and profitability, network quality and award winning
customer service. He completed his assignment at Cellular One upon
successful conclusion of its merger with AT&T, which was valued in
excess of US$3 billion.

Prior to Cellular One, Donnell served 15 years with Plano,
TX-headquartered PageNet where his most recent position was
President of PageNet's San Ramon, CA-based Western Region. As
President of the Region he was responsible for establishing start-
up operations across the Western U.S. as well as leading the sales
and marketing, network planning and construction, customer
operations and financial management of those operations. During
his tenure, PageNet pioneered the deployment of the first 900 Mhz
simulcast paging systems and the first private earth station
satellite up links in the industry.

Donnell graduated from the University of Central Oklahoma in
Edmond, OK, where he earned a Bachelors of Arts Degree in
Marketing.

Zi Corporation -- http://www.zicorp.com-- is a technology company
that delivers intelligent interface solutions to enhance the user
experience of wireless and consumer technologies. The company's
intelligent predictive text interfaces, eZiTap(TM) and eZiText,
allow users to personalize the device and simplify text entry
providing consumers with easy interaction for short messaging, e-
mail, e-commerce, Web browsing and similar applications in almost
any written language. eZiNet(TM), Zi's new client/network based
data indexing and retrieval solution, increases the usability for
data-centric devices by reducing the number of key strokes
required to access multiple types of data resident on a device, a
network or both. Zi supports its strategic partners and customers
from offices in Asia, Europe and North America. A publicly traded
company, Zi Corporation is listed on the Nasdaq National Market
(ZICA) and the Toronto Stock Exchange (ZIC).

At March 31, 2003, Zi Corporation's balance sheet disclosed a
working capital deficit of about $2 million.


* Large Companies with Insolvent Balance Sheets
-----------------------------------------------
                                Total
                                Shareholders  Total     Working
                                Equity        Assets    Capital
Company                 Ticker  ($MM)          ($MM)     ($MM)
-------                 ------  ------------  -------  --------
Alliance Imaging        AIQ         (39)         683       43
Akamai Technologies     AKAM       (168)         230       60
Alaris Medical          AMI         (32)         586      173
Amazon.com              AMZN     (1,353)       1,990      550
Aphton Corp             APHT        (11)          16       (5)
Arbitron Inc.           ARB        (100)         156       (2)
Alliance Resource       ARLP        (46)         288      (16)
Atari Inc.              ATAR        (97)         232      (92)
Actuant Corp            ATU         (44)         295       18
Avon Products           AVP         (91)       3,327       73
Saul Centers Inc.       BFS         (13)         389      N.A.
Blount International    BLT        (369)         428       91
Caraco Pharm Lab        CARA        (20)          20       (2)
Cincinnati Bell         CBB      (2,104)       1,467     (327)
Cubist Pharmaceuticals  CBST         (7)         221      131
Choice Hotels           CHH        (114)         314      (37)
Columbia Laboratories   COB          (8)          13        5
Campbell Soup Co.       CPB        (114)       5,721   (1,479)
Centennial Comm         CYCL       (470)       1,607      (95)
Echostar Comm           DISH     (1,206)       6,260    1,674
D&B Corp                DNB         (19)       1,528     (104)
Graftech International  GTI        (351)         859      108
Hollywood Casino        HWD         (92)         553       89
Hexcel Corp             HXL        (127)         708     (531)
Imax Corporation        IMAX       (104)         243       31
Imclone Systems         IMCL       (186)         484      139
Gartner Inc.            IT          (29)         827        1
Jostens                 JOSEA      (512)         327      (71)
Journal Register        JRC          (4)         702      (20)
KCS Energy              KCS         (30)         268      (16)
Kos Pharmaceuticals     KOSP        (75)          69      (55)
Level 3 Comm Inc.       LVLT       (240)       8,963      581
Memberworks Inc.        MBRS        (21)         281     (100)
Moody's Corp.           MCO        (327)         631     (190)
McDermott International MDR        (417)       1,278      154
McMoRan Exploration     MMR         (31)          72        5
Maguire Properti        MPG        (159)         622      N.A.
MicroStrategy           MSTR        (34)          80        7
Northwest Airlines      NWAC     (1,483)      13,289     (762)
ON Semiconductor        ONNN       (548)       1,203      195
Petco Animal            PETC        (11)         555      113
Primedia Inc.           PRM        (559)       1,835     (248)
Primus Telecomm         PRTL       (168)         724       65
Per-Se Tech Inc.        PSTI        (39)         209       32
Qwest Communications    Q        (1,094)      31,228   (1,167)
Rite Aid Corp           RAD         (93)       6,133    1,676
Revlon Inc              REV      (1,640)         939      (44)
Ribapharm Inc           RNA        (363)         199       92
Sepracor Inc            SEPR       (392)         727      413
St. John Knits Int'l    SJKI        (76)         236       86
I-Stat Corporation      STAT          0           64       33
Town and Country Trust  TCT          (2)         504      N.A.
Tenneco Automotive      TEN         (75)       2,504      (50)
TiVo Inc.               TIVO        (25)          82        1
Triton PCS Holdings     TPC         (36)       1,617      172
UnitedGlobalCom         UCOMA    (3,040)       5,931   (6,287)
United Defense I        UDI         (30)       1,454      (27)
UST Inc.                UST         (47)       2,765      829
Valassis Comm.          VCI         (33)         386       80
Valence Tech            VLNC        (17)          36        4
Ventas Inc.             VTR         (54)         895      N.A.
Warnaco Group           WRNC     (1,856)         948      471
Western Wireless        WWCA       (464)       2,399     (120)
Xoma Ltd.               XOMA        (11)          72       30

                          *********

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
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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
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