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        T R O U B L E D   C O M P A N Y   R E P O R T E R

           Wednesday, August 13, 2003, Vol. 7, No. 159

                          Headlines

3D SYSTEMS: Names Charles Hull Interim Chief Executive Officer
ABACUS COMMUNICATIONS: Bringing-In Marcus Santoro as Attorneys
ACETEX CORP: Commences 18-Day Unscheduled Maintenance Shutdown
ACP HOLDING: Has Until October 23 to File Schedules & Statements
ACTERNA CORP: Joint Plan's Classification & Treatment of Claims

ADELPHIA BUSINESS: Exclusivity Extension Hearing Set for Tuesday
ADELPHIA COMMS: Has Until Oct. 20 to File Schedules & Statements
AIR CANADA: Reports 75% On-Time Performance Throughout Network
AIR CANADA: Will Propose 10-Year Pension Plan Amortization
AMERCO: Committee Secures Nod to Hire Milbank Tweed as Counsel

AMES DEPT.: Wants Plan Filing Exclusivity Extended to Feb. 27
AMTROL INC: S&P Junks Credit Rating over Liquidity Concerns
ARMSTRONG: AWI Gets Nod to Assume Amended Dow Chemical Contract
ATCHISON CASTING: First Creditors' Meeting Slated for October 1
BLOUNT INT'L: June 30 Balance Sheet Upside-Down by $368 Million

BUDGET GROUP: Wants Lease Decision Period Extended to Sept. 29
BURLINGTON: Liquidation Analysis Under First Amend Ch. 11 Plan
CHOICE ONE: June 30 Net Capital Deficit Balloons to $576 Million
CITGO PETROLEUM: Improved Liquidity Spurs Fitch to Up Ratings
COMMSCOPE INC: Second-Quarter Net Loss Slides-Up to $51 Million

CONSECO INC: Wants Go-Signal to Assume Hylant Purchase Agreement
CORRPRO COS.: Completes Amendments to Senior Debt Agreements
COVANTA: Exclusivity Extension Hearing Adjourned Until Today
DIGITALNET: S&P Says $86MM Public Offering Won't Affect Ratings
DRYDEN IV-LEVERAGED: S&P Assigns BB Rating to Class D Notes

DYNEGY: Closes Refinancing Deals and ChevronTexaco Restructuring
EQUITY INNS: Completes 8.75% Series B Preferred Shares Offering
EQUITY INNS: Friedman Assists Co. in Completed Preferred Issue
EZENIA! INC: Nasdaq Knocks Shares Off Effective August 12, 2003
FIBERMARK: S&P Cuts Rating as Weak Demand Hurts Credit Measures

FLEMING: Wins Final Nod to Hire Retail Consulting and Staubach
FRIEDE GOLDMAN: Court Fixes August 27 Admin. Claims Bar Date
FRONTLINE COMMS: Fails to Meet AMEX Continued Listing Standards
GALEY & LORD: Wants $50MM DIP Financing Extension through Oct. 3
GARDENBURGER INC: June 30 Net Capital Deficit Widens to $52 Mil.

GE CAPITAL: Fitch Takes Rating Actions on 5 Securitizations
GENERAL MEDIA: Files for Chapter 11 Reorganization in S.D.N.Y.
GENERAL MEDIA INC: Voluntary Chapter 11 Case Summary
HANOVER COMPRESSOR: Acquires Remaining 49% Interest in Belleli
IESI CORP: June 30 Balance Sheet Insolvency Widens to $48 Mill.

IMMTECH INT'L: Commences Trading on AMEX Effective August 11
INTEGRATED HEALTH: Court Approves Stipulation with BT Products
INTERCEPT INC: June 30 Working Capital Deficit Widens to $40MM
INT'L MULTIFOODS: Completes $250-Million Refinancing Transaction
IRVINE SENSORS: June 29 Working Capital Deficit Narrows to $210K

IRVINE SENSORS: Holding Third Quarter Conference Call Today
JAMES CABLE: Disclosure Statement Hearing Set for August 18
JP MORGAN: Fitch Assigns Low-B Ratings to Six Notes Classes
KINETIC CONCEPTS: Completes Key Aspects of Recapitalization
LAIDLAW: Enters Stipulation Allowing Citibank Canada Swap Claims

LEAP WIRELESS: Solicits Competing Bids for Spectrum in Idaho
LEAP WIRELESS: Court Okays PricewaterhouseCoopers as Accountants
LORAL SPACE: Appoints BSI as Court Claims and Noticing Agent
MAGNATRAX CORP: Proofs of Claim Due by September 8, 2003
MCDERMOTT INT'L: June 30 Net Capital Deficit Widens to $433 Mil.

MEDIACOM COMMS: Fitch Assigns Junk/Low-B Preliminary Ratings
MIRANT CORP: Court OKs White & Case Engagement on Interim Basis
MORGAN STANLEY: Fitch Firms Low-B Ratings on Five Note Classes
NATIONAL STEEL: Takes Action to Challenge Various Claims
NAVISITE INC: Completes Acquisition of Certain ClearBlue Assets

NEXTERA ENTERPRISES: Has Until Oct. 7 to Meet Nasdaq Guidelines
NRG ENERGY: Court Okays Trading Contracts Settlement Procedures
OWENS CORNING: Committee Wins Approval to Hire Towers Perrin
PAC-WEST TELECOMM: Regains Compliance with Nasdaq Requirements
PENN TRAFFIC: Arranges $270 Million Permanent DIP Financing

PENN TREATY: Second Quarter Results Reflect Marked Improvement
PETROLEUM GEO: Seeking Okay to Sign-Up Willkie Farr as Attorneys
PG&E NATIONAL: U.S. Trustee Appoints USGen Creditors' Committee
PILLOWTEX CORP: Wants More Time to File Schedules and Statements
PINNACLE FOODS: S&P Keeps Watch after Acquisition Announcement

QUAIL PIPING: Wants Approval for Asset Sale Bidding Procedures
RCN CORP: June 30 Net Capital Deficit Widens to $2.4 Billion
RESOURCE AMERICA: June 2003 Quarter Results Show Strong Growth
REXNORD CORP: First Quarter Results Swing-Down to $2.5M Net Loss
RIVIERA HOLDINGS: S&P Ratchets Credit Rating Down a Notch to B

SAFETY-KLEEN: Posts Reorganized Value Estimated by Lazard Freres
SAMUELS JEWELERS: US Trustee to Meet with Creditors on Sept. 12
SBA COMMS: Red Ink Continued to Flow in Second Quarter 2003
SLATER STEEL: Realigning Stainless Bar Operations Due to Losses
SMTC CORP: June 29, 2003 Balance Sheet Upside-Down by $22 Mill.

SUN HEALTHCARE: Has Until September 15, 2003 to Challenge Claims
SWIFT & CO.: Exchange Offer for 10-1/8% Notes Expires Today
TIMMIMCO: Reports Improved Balance Sheet Following Debt Workout
TRANS-INDUSTRIES: Taps Relational Advisors to Aid in Refinancing
TRENWICK: Fitch Withdraws Various Long-Term & Sr. Debt Ratings

UBIQUITEL INC: Second Quarter 2003 Net Loss Hits $9 Million Mark
UNITED AIRLINES: Intends to Amend Aircraft Financing Agreements
UPC POLSKA: Court Sets Disclosure Statement Hearing for Sept. 16
U.S.I. HOLDINGS: Closes $155 Million Sr. Secured Credit Facility
VHJ ENERGY LLC: Case Summary & 11 Largest Unsecured Creditors

WINSTAR COMMS: BEA Systems Seeks Stay Relief to Setoff Claims
WORLDCOM: Church Group Urges FCC to Block Key License Transfers
WORLDCOM INC: Wants Clearance for $21 Million Cisco Settlement
WYNN RESORTS: Boone Wayson Joins Company's Board of Directors
ZALE CORP: Betsy Burton Elected to Board of Directors

ZI CORP: Pursuing Talks with Lancer Receiver re Held Shares

* FTI Consulting Inks Pact to Sell SEA Group Assets for $16 Mil.

* Meetings, Conferences and Seminars

                          *********

3D SYSTEMS: Names Charles Hull Interim Chief Executive Officer
--------------------------------------------------------------
3D Systems Corp.'s (Nasdaq: TDSC) Board of Directors announced
that Brian K. Service has decided to resign from his positions as
officer and director immediately.  Mr. Service will continue with
the Company for a 24 month-term to assist with various clients and
transactions.

"Brian originally joined the Company anticipating a short term
assignment. Instead he stayed almost four years," said G. Walter
Loewenbaum II, Chairman of the Board of Directors. "The Board of
Directors has decided to put in place a long-term management
team."

The Board also announced that it has named co-founder Charles W.
Hull as interim chief executive officer.  Mr. Hull, the Company's
chief technical officer, co-founded 3D Systems and previously
served the Company as executive vice president, president, chief
operating officer, vice chairman and chief technical officer. He
will continue to act as the Company's chief technical officer.

The Board also announced the appointment of Kevin M. McNamara as
acting chief financial officer effective August 15, 2003.
Mr. McNamara began working with 3D Systems in June 2003 as a
financial consultant. He has served as chief financial officer of
HCCA International, a private venture-backed startup in Nashville,
TN since September 2002. He is a member with Voyent Partners, a
private equity firm, since August 2001. Previously, he served as
the chief executive officer for Private Business, Inc. from 1999
until 2001. From 1996 to 1999, he was chief financial officer for
ENVOY Corporation, and from 1994 to 1995, he was president of the
Merchant Services Division of National Bancard Corporation
(NaBANCO). McNamara serves on the Board of Directors of two public
companies, Luminex Corporation (LMNX) and ProxyMed Inc (PILL), and
several private companies. He received his undergraduate degree at
Virginia Commonwealth University and his Masters of Business
Administration at the University of Richmond, Virginia. He is a
certified public accountant in Virginia.

Mr. Loewenbaum stated, "I am delighted to be working directly with
Chuck Hull and Kevin McNamara. Chuck's in-depth knowledge of our
Company, its people, customers and its technology combined with
the expertise Kevin McNamara brings to our company will enable us
to make a seamless transition. I have had the pleasure of serving
with Kevin on two other Boards over the past seven years and have
been greatly impressed with his abilities. We have begun a search
for a new president and CEO. We have been most impressed with the
candidates we have interviewed for the post of president to date
and hope to complete the search in a relatively short period of
time."

Founded in 1986, 3D Systems(R), the solid imaging company(SM),
provides solid imaging products and solutions that reduce the time
and cost of designing products and facilitate direct and indirect
manufacturing. Its systems utilize patented technologies to create
physical objects from digital input that can be used in design
communication, prototyping, and as functional end-use parts.

3D Systems currently offers the ThermoJet(R) solid object printer,
SLA(R) (stereolithography) systems, SLS(R) (selective laser
sintering) systems, and Accura(R) materials (including
photopolymers, metals, nylons, engineering plastics, and
thermoplastics).

3D Systems is the originator of the advanced digital manufacturing
(ADM(SM)) solution for manufacturing applications. ADM is the
utilization of 3D Systems solid imaging technologies to accelerate
production of smaller volumes of customized/ specialized parts. A
typical ADM center is expected to contain multiple 3D Systems'
SLA, MJM and/or SLS systems dedicated to full-time manufacturing
applications.

Product pricing in the U.S. ranges from $49,995, for the ThermoJet
printer, to $799,000 for the high-end SLA 7000 system. 3D Systems'
multiple platform product line enables companies to choose the
most appropriate systems for applications ranging from the
creation of design communication models to prototypes to
production parts

More information on the company is available at
http://www.3dsystems.com

As reported in Troubled Company Reporter's August 8, 2003 edition,
Deloitte and Touche LLP informed 3D Systems in April that it did
not intend to stand for reelection as the Company's principal
independent accountant.  On July 16, 2003, Deloitte advised the
Company that the client-auditor relationship between the Company
and Deloitte had ceased.

Deloitte's 2002 report contained an explanatory paragraph relating
to a going concern uncertainty.

During the fiscal years ended December 31, 2002 and 2001 and the
period from January 1, 2003 to July 16, 2003, (a) there were no
disagreements with Deloitte on any matter of accounting principles
or practices, financial statement disclosure, or auditing scope or
procedure, which disagreements, if not resolved to the
satisfaction of Deloitte, would have caused Deloitte to make
reference to the subject matter of the disagreements in connection
with its report, and (b) there were no "reportable events" as the
term is defined in Item 304(a)(1)(v) of Regulation S-K, except as
follows:

Deloitte informed the Company that material weaknesses in the
Company's internal controls existed. Specifically, Deloitte
advised the Company that:

     - The Company's accounting and finance staff are inadequate
       to meet the needs of a complex, multinational SEC
       registrant. The Company needs to strengthen its capability
       to implement existing generally accepted accounting
       principles, as well as understand and implement new
       accounting standards. In addition, the Company needs to
       strengthen its capabilities in performing routine
       accounting processes involved in closing its books, such as
       account reconciliations and analyses.

     - The Company needs to strengthen its controls and processes
       related to revenue recognition. During 2002, 2001 and 2000,
       revenue was recognized for transactions that did not meet
       the requirements for revenue recognition under the
       Company's policies or generally accepted accounting
       principles.


ABACUS COMMUNICATIONS: Bringing-In Marcus Santoro as Attorneys
--------------------------------------------------------------
Abacus Communications LC asks the U.S. Bankruptcy Court for the
Eastern District of Virginia for permission to employ Marcus,
Santoro & Kozak, PC as its attorneys.

Marcus Santoro is expected to:

     a. prepare the petition, lists, schedules and statements
        required by Section 521; the pleadings, motions, notices
        and orders required for the orderly administration of
        the estate and to ensure the progress of this case; and
        to consult with and advise the Debtor in the
        reorganization of its business and the orderly
        administration of its assets;

     b. prepare for, prosecute, defend, and represent the
        Debtor's interests in all contested matters, adversary
        proceedings, and other motions and applications arising
        under, arising in, or related to this case;

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

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

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

Frank J. Santoro, Esq., discloses that his firm will charge its
current hourly rates in exchange of its services.  Currently, the
firm's standard hourly rates are:

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

Mr. Santoro's hurly rate is $260 per hour while Karen Cowley's
rate is $220 per hour.

Abacus Communications LC, headquartered in Virginia Beach,
Virginia is an outsourcing service bureau. The Company filed for
chapter 11 protection on August 1, 2003 (Bankr. E.D. Va. Case No.
03-75562). When the Company filed for protection from its
creditors, it listed $12,750,352 in total assets and $13,049,014
in total debts.


ACETEX CORP: Commences 18-Day Unscheduled Maintenance Shutdown
--------------------------------------------------------------
Acetex Corporation announced that customers are being informed of
an unscheduled maintenance shutdown for the completion of
necessary repair work at its Pardies, France, facility which
commenced Saturday, August 9, 2003, and which is expected to last
for a period of 18 days. As a result, Acetex is declaring Force
Majeure due to expected difficulty in meeting sales contract
delivery obligations. Acetex will be taking all possible measures
to mitigate inconvenience to customers including sourcing material
from other producers wherever possible. This is the first major
unscheduled maintenance event experienced by Acetex since 1997.

Acetex Corporation has two primary businesses - its European
Acetyls business and the AT Plastics business. Our Acetyls
business is Europe's second largest producer of acetic acid and
polyvinyl alcohol and third largest producer of vinyl acetate
monomer. These chemicals and their derivatives are used in a wide
range of applications in the automotive, construction, packaging,
pharmaceutical and textile industries.

The AT Plastics business of Acetex develops and manufactures
specialty polymers and films products. Specialty polymers are used
in the manufacture of a variety of plastics products, including
packaging and laminating products, auto parts, adhesives and
medical products. The films business focuses on products for the
agricultural, horticultural and construction industries.

Acetex (S&P, B+ Corporate Credit Rating, Stable) directs its
operations from its corporate head office in Vancouver, Canada.
Acetex has plants in France, Spain, and Edmonton, Alberta, and
sells to customers in Europe, the United States, Canada, and
around the world. Acetex's common shares are listed for trading
under the symbol "ATX" on The Toronto Stock Exchange, which has
neither approved nor disapproved the information contained herein.


ACP HOLDING: Has Until October 23 to File Schedules & Statements
----------------------------------------------------------------
The U.S. Bankruptcy Court for the District of Delaware gave ACP
Holding Company and its debtor-affiliates more time to prepare and
deliver their schedules of assets and liabilities, statements of
financial affairs and lists of executory contracts and unexpired
leases required under 11 U.S.C. Sec. 521(1).  The Debtors have
until October 23, 2003 to file these required documents.

Neenah Foundry Company, the operating subsidiary of ACP Holding
Company is headquartered in Neenah, Wisconsin.  The Company is in
the business of gray & ductile iron foundries, metal machining to
specifications and steel forging.  The Company filed for chapter
11 protection on August 5, 2003 (Bankr. Del. Case No. 03-12414).
Laura Davis Jones, Esq., at Pachulski, Stang, Ziehl Young Jones &
Weintraub P.C., and James H.M. Sprayregen, P.C., Esq., and James
W. Kapp III, Esq., at Kirkland & Ellis LLP represent the Debtors
in their restructuring efforts. When the Company filed for
protection from its creditors, it listed $494,046,000 in total
assets and $580,280,000 in total debts.


ACTERNA CORP: Joint Plan's Classification & Treatment of Claims
---------------------------------------------------------------
In accordance with Section 1122 of the Bankruptcy Code, Acterna
Corp., and its debtor-affiliates' Plan of Reorganization provides
for the classification of Classes of claims and equity interests.
Section 1122(a) permits a plan to place a claim or an interest in
a particular class only if the claim or interest is substantially
similar to the other claims or interests in that class.

Pursuant to Section 1123(a)(1), Administrative Expense Claims and
Priority Tax Claims have not been classified and the holders of
these Claims are not entitled to vote to accept or reject the
Plan.  Allowed Administrative and Allowed Priority Claims are to
be paid in full on the Effective Date of the Plan, or, for
ordinary course Administrative Claims, when the claims become due
and, for tax claims, as contemplated under Section 507(a)(8) of
the Bankruptcy Code.

The Debtors believe that the classification of Claims and Equity
Interests under the Plan is appropriate and consistent with
applicable law.

Class   Description              Recovery Under the Plan
-----   -----------              -----------------------
N/A     Administrative           Paid in full, in cash
        Expense Claims
        and DIP Claims           Letters of credit claims will
                                 either be replaced or cash
                                 collaterized at 105%

N/A     Compensation and         Paid in full, in cash
        Reimbursement Claims

N/A     Priority Tax Claims      Each holder will receive:

                                 (a) full cash payment; or

                                 (b) annual cash payments in an
                                     aggregate amount equal to
                                     the allowed priority tax
                                     claim, with an 8% annual
                                     interest.

A      Priority Non-Tax Claims  Paid in full, in cash

B      Other Secured Claims     Each Holder will:

                                 (a) be reinstated and rendered
                                     unimpaired;

                                 (b) receive cash equal to the
                                     claim amount, plus interest;
                                     or

                                 (c) receive the Collateral
                                     securing its allowed claim
                                     and any interest.

                                 Unimpaired, not entitled to vote

C      Senior Lender Claims

C(a)   Senior Lender Claims     Each Holder will receive its
                                 Ratable Proportion of:

                                 (a) 100% of the shares of the
                                     New Common Stock; and

                                 (b) $75,000,000 in principal
                                     amount of the New Secured
                                     Term Notes.

                                 Each Holder will receive a
                                 Ratable Proportion of any
                                 excess cash available on the
                                 Effective Date.

                                 In the event the Reorganized
                                 Debtors receive net cash
                                 proceeds from the sale of
                                 Itronix or da Vinci at any time,
                                 Holders will be paid a portion
                                 of the net cash proceeds to be
                                 determined by the Debtors and
                                 JPMorgan.

C(b)   German L/C               Each Participant will receive
        Participants             its Ratable Proportion of
                                 EUR82,498,945 from the
        -- each participant      Restructured German Term Debt
        is a lender under        and the Restructured Term Debt
        the Bank Credit          Guaranty will remain unimpaired
        Agreement and at         and the guaranty obligations of
        the same time holds      each Debtor will remain in full
        a claim for              force and effect at all times
        reimbursement            from the Effective Date.
        pursuant to a German
        L/C Participation        Both subclasses will be entitled
        Commitment related       to retain all amounts paid as
        to the Bank Credit       adequate protection and the
        Agreement                Reorganized Debtors will
                                 continue to honor their
                                 obligations under the Bank
                                 Credit Agreement including the
                                 payment of professional fees and
                                 expenses of the Holders in
                                 matters related to the Chapter
                                 11 cases.

                                 Impaired, entitled to vote

D      General Unsecured        Each Holder will receive its
        Claims                   Ratable Proportion of the lesser
                                 of $5,000,000 and 10% of the
                                 aggregate Allowed General
                                 Unsecured Claims.  However,
                                 Class D will receive a
                                 distribution of no less than
                                 $3,500,000.

                                 Impaired, entitled to vote

E      Convertible Notes        Allowed for $89,252,818 in
        Claims                   the aggregate

                                 With CD&R's consent, holders
                                 will receive the treatment set
                                 for Class F.

                                 Impaired, entitled to vote

F      Subordinated Notes       Allowed for $176,479,264 in
        Claims                   the aggregate

                                 Impaired, entitled to vote

                                 If Class F votes to accept the
                                 Plan, each Holder will receive
                                 its Ratable Proportion of the
                                 New Warrants.

                                 Otherwise, holders will get
                                 nothing.

G      Intercompany Claims      Legal, equitable, and
                                 contractual rights of holders
                                 are unaltered by the Plan,
                                 except as determined by the
                                 Debtors.

                                 Unimpaired, not entitled to vote

                                 $236,870,460 aggregate amount as
                                 of the Petition Date

H      Securities Litigation    Holders will not receive any
        Claims                   distribution and will be
                                 enjoined from pursuing any
                                 claims against any of the
                                 Debtors.

                                 Impaired, deemed to reject the
                                 Plan

I      Equity Interests         Holders will not receive any
                                 distributions.

                                 On Effective Date, all Equity
                                 Interests will be extinguished.

                                 Impaired, deemed to reject the
                                 Plan
(Acterna Bankruptcy News, Issue No. 8; Bankruptcy Creditors'
Service, Inc., 609/392-0900)


ADELPHIA BUSINESS: Exclusivity Extension Hearing Set for Tuesday
----------------------------------------------------------------
Over the last few months, the Adelphia Business Solutions Debtors
have made substantial and meaningful progress toward the
negotiation of a consensual plan of reorganization with the
statutory committee of unsecured creditors and the informal
committee of holders of 12-1/4% Senior Secured Notes ABIZ issued
due 2004.  In fact, Judy G.Z. Liu, Esq., at Weil, Gotshal & Manges
LLP, in New York, informs the Court that the Committees are in the
process of finalizing a proposed plan and disclosure statement and
anticipate being ready to file these documents within the next few
weeks.

Accordingly, with the Committees' consent, the Debtors ask the
Court to extend their:

   (a) Exclusive Plan Filing Period to and including August 29,
       2003; and

   (c) Exclusive Solicitation Period to and including
       October 28, 2003.

Ms. Liu contends that there are ample causes to extend the
Exclusive Periods:

   (a) The size and complexity of the Debtors' Chapter 11 cases
       require an extension of Exclusive Periods;

   (b) Except for certain open issues, a consensual plan of
       reorganization is on the horizon;

   (c) The additional short extension will allow the Debtors and
       the Committees to resolve the remaining open issues;

   (d) Additional extensions are routinely granted in numerous
       complex cases like that of the Debtors;

   (e) The extension will not prejudice parties-in-interest; and

   (f) The Debtors are making the required postpetition payments
       and effectively managing their businesses.

                          *     *     *

The Court will convene a hearing on August 19, 2003 to consider
the Debtors' request.  Accordingly, Judge Gerber extends the
Exclusive Plan Filing Period until the conclusion of that
hearing. (Adelphia Bankruptcy News, Issue No. 38; Bankruptcy
Creditors' Service, Inc., 609/392-0900)


ADELPHIA COMMS: Has Until Oct. 20 to File Schedules & Statements
----------------------------------------------------------------
The Adelphia Communications Debtors obtained the Court's approval
extending their deadline to file their Schedules of Assets and
Liabilities, Lists of Executory Contracts and Leases, and
Statements of Financial Affairs until October 20, 2003. (Adelphia
Bankruptcy News, Issue No. 38; Bankruptcy Creditors' Service,
Inc., 609/392-0900)


AIR CANADA: Reports 75% On-Time Performance Throughout Network
--------------------------------------------------------------
Air Canada reported an on-time performance of 75 per cent
throughout its network as of 1700 EDT.

The airline yesterday introduced contractual changes which were
recently negotiated during labor agreements related to the
restructuring. These changes, involving airport customer service
employees, provide the company with greater flexibility in
staffing at peak periods mainly through the conversion of full-
time employees to part-time at key airports throughout the
country.

"The situation [Mon]day is stable and very normal for a busy
summer day. Sunday's operations at the main hub in Toronto were
challenging as the first day of transition to the new work rules
and shifts coincided with amongst the highest forecast passenger
loads for the summer as well as weather-related disruptions. We
apologize to those customers who were impacted by yesterday's
flight delays," said Captain Rob Giguere, Executive Vice
President, Operations.

"Despite thunderstorm activity at our main hub of Pearson late
this afternoon which resulted in the suspension of operations on
three separate occasions and U.S. Customs and Immigration
processing delays for most of the day at Toronto, as of 1700 EDT,
we experienced 75 per cent on time arrival within 15 minutes
throughout the airline's worldwide network. There are, in fact,
more agents working at peak times at Toronto, Montr,al and
Vancouver as a result of the changes introduced yesterday than we
have had in previous weeks. We will continue to monitor customer
volumes in the coming days and make any adjustments to staffing
levels that may be required to ensure customer service is at
satisfactory levels," concluded Captain Giguere. VI


AIR CANADA: Will Propose 10-Year Pension Plan Amortization
----------------------------------------------------------
Air Canada continues to discuss with the representatives of the
Office of the Superintendent of Financial Institutions, the
Canadian labor unions and non-unionized employees and retirees, a
concession to address the funding of the solvency deficit in its
registered pension plans in light of its current financial
situation, its Court protection under the CCAA, its effort to
seek new equity investors and long-term financing and to
restructure its pre-filing liabilities, which are currently
stayed under the CCAA.  To date, Air Canada estimates that the
overall Canadian registered pension plan actuarial deficit on a
solvency basis has increased from $1,300,000,000 estimated on
January 1, 2003 to $1,800,000,000.

Notwithstanding that North American stock markets have shown
positive returns since January 1, 2003, Air Canada's actuaries
have advised that the further decline in long-term interest rates
over the same period has more than offset the recent positive
stock market performance.  On a going concern basis, the deficit
in the Canadian registered pension plans is estimated to be
$239,000,000 as at January 1, 2003.

Pursuant to the preliminary amendments Air Canada proposed at a
July 22, 2003 meeting with the OSFI, the Department of Finance
and various organized labor and non-unionized groups, Air Canada
foresees that it could, upon emerging from CCAA, fund its pension
plans based on a going concern basis only, for a period of three
years ending on January 1, 2006.  Thereafter, Air Canada expects
that any solvency deficit would become payable over a 10-year
period.  Under this proposal, contributions would resume
immediately for all plans retroactive to January 1, 2003.

Air Canada estimates that the 2003 Company contributions to the
Canadian registered pension plans would be $175,000,000 on a
going concern basis.  Conversely, if the pension plans were
funded on a solvency deficit basis, it is estimated that the
Company contributions to the Canadian registered pension plans
would be $540,000,000 in 2003 if the deficit were amortized over
a five-year period and the amount of the contribution holiday
taken in 2002 were paid as directed by OSFI.

Murray McDonald, President of Ernst & Young, Inc., states that
Air Canada is finalizing a definitive proposal, which will
incorporate the going concern basis of funding, and the 10-year
amortization discussion, which will then be submitted for support
to its unions and other employee representatives before
presentation to OSFI. (Air Canada Bankruptcy News, Issue No. 10;
Bankruptcy Creditors' Service, Inc., 609/392-0900)


AMERCO: Committee Secures Nod to Hire Milbank Tweed as Counsel
--------------------------------------------------------------
At the Official Committee of Unsecured Creditors' request, Judge
Zive, overseeing AMERCO's bankruptcy proceedings, permits the
Committee to retain Milbank, Tweed, Hadley & McCloy LLP as
counsel, nunc pro tunc to June 20, 2003.

As counsel, Milbank will:

    (a) advise the Committee with respect to its rights, powers
        and duties in Amerco's case;

    (b) assist and advise the Committee in its consultation with
        the Debtor relative to the administration of Amerco's
        case;

    (c) assist the Committee in analyzing the claims of the
        Debtor's creditors and in negotiating with them;

    (d) assist with the Committee's investigation of the acts,
        conduct, assets, liabilities and financial condition of
        the Debtor and of the operation of the Debtor's business;

    (e) assist the Committee in its analysis of, and negotiations
        with, the Debtor or any third party concerning matters
        related to, among other things, the terms of a plan or
        plans of reorganization for the Debtor;

    (f) assist and advise the Committee with respect to its
        communications with the general creditor body regarding
        significant matters in Amerco's case;

    (g) review and analyze all applications, orders, statements
        of operations and schedules filed with the Court and
        advise the Committee as to their propriety;

    (h) assist the Committee in evaluating, and pursuing, if
        necessary, claims and causes of action against the
        Debtor's secured lenders;

    (i) assist the Committee in preparing pleadings and
        applications as may be necessary in furtherance of the
        Committee's interests and objectives;

    (j) represent the Committee at all hearings and other
        proceedings; and

    (k) perform other legal services as may be required and are
        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.

Paul S. Aronzon, Esq., a partner at Milbank, Tweed, Hadley &
McCloy LLP, relates that Milbank will seek compensation pursuant
to these hourly rates:

    Paul S. Aronzon           $725
    David B. Zolkin            480
    Derrick M. Talerico        325

Milbank will also seek reimbursement of expenses incurred in the
rendition of the services.  These expenses may include, among
other things, costs of telephone, facsimile, photocopying,
travel, business meals, computerized research, messengers,
couriers, postage, witness fees and other related fees.

According to Mr. Aronzon, Milbank received $886,985 from Amerco
on account of prepetition services rendered.  In connection with
Milbank's representation of an ad hoc committee of bondholders,
Milbank asked and received from Amerco a $150,000 retainer prior
to the Petition Date.  As of the Petition Date, $118,399 of the
Retainer remained unapplied.

Mr. Aronzon assures the Court that Milbank does not represent and
does not hold any adverse interest to Amerco's estate or its
creditors in connection with this case.  Mr. Aronzon also informs
Judge Zive that Milbank may have certain connections with
Amerco's creditors and other parties-in-interests but are wholly
unrelated to Amerco's case. (AMERCO Bankruptcy News, Issue No. 4;
Bankruptcy Creditors' Service, Inc., 609/392-0900)


AMES DEPT.: Wants Plan Filing Exclusivity Extended to Feb. 27
-------------------------------------------------------------
According to Martin J. Bienenstock, Esq., at Weil, Gotshal &
Manges LLP, in New York, the Ames Department Stores Debtors have
not yet determined the full extent of their administrative
obligations and the resources available to satisfy them.  Until
then, the Debtors will not be able to develop a confirmable
Chapter 11 Plan.

Thus, the Debtors ask the Court to further extend their exclusive
periods to file a reorganization plan until February 27, 2004 and
to solicit acceptances of that plan until April 27, 2004.

Mr. Bienenstock informs the Court that the Debtors have
successfully disposed majority of their real property, while a
number of their major real estate assets have not yet been
liquidated, including a distribution center and a home office
building.  The Debtors anticipate that they will have
$115,000,000 to $120,000,000 in administrative expense claims,
many of which still need to be reconciled.  In addition to
liquidating their remaining real estate interests and reconciling
claims, Mr. Bienenstock says that the Debtors need time to
further analyze and prosecute certain Preference Actions.  While
the Debtors have commenced over 1,500 Preference Actions to date,
their analysis is ongoing, and the Debtors will continue to
commence additional Preference Actions in the coming weeks.  Mr.
Bienenstock anticipates that the prosecution of the Preference
Actions will take several months to complete.  The Debtors submit
that the analysis and prosecution of the Preference Actions is
critical to a determination of the ultimate recovery available to
creditors in their Chapter 11 cases.

Mr. Bienenstock explains that the Debtors and the Official
Committee of Unsecured Creditors have worked, and continue to
work, constructively.  Given the scope of the Debtors' cases,
litigation with third parties is minimal.  Mr. Bienenstock adds
that the vital components underlying a Chapter 11 plan are being
developed as rapidly as possible.  Furthermore, responding to a
competing plan while simultaneously engaging in the orderly
liquidation of their assets would seriously undermine the
Debtors' attempt to maximize recoveries for creditors.  In short,
Mr. Bienenstock asserts, the failure to extend the Exclusive
Periods could subvert the Debtors' overall progress to date.

By any reasonable measure, the Debtors' Chapter 11 cases are
sufficiently large and complex to warrant an extension of the
Exclusive Periods, Mr. Bienenstock maintains.  Mr. Bienenstock
stresses that the Debtors' cases, with thousands of creditors and
$1,500,000,000 in assets and liabilities, is "among the larger
and more complex Chapter 11 cases by nationwide standards."
Thus, the Debtors' current Exclusive Periods do not provide
adequate time to develop a Plan in these cases.

The Debtors assure the Court that with their progress --
specifically by taking all prompt action to halt operations,
reconcile claims, liquidate assets, and recover avoidable
preferences -- they have "not delayed making the decisions
necessary to achieve a consensual plan."  Furthermore, the
Debtors state that they are not seeking an extension to delay the
Chapter 11 process for some speculative event or to pressure
creditors to accede to a plan unsatisfactory to them.

Mr. Bienenstock tells the Court that the Debtors have consistently
conferred with various constituencies on all major substantive
and administrative matters in their Chapter 11 cases and have
often altered their position in deference to the views of the
Committee, the U.S. Trustee, or other parties-in-interest.  An
extension will not prejudice any party-in-interest but will avert
prematurity and afford the Debtors an opportunity to propose a
realistic and viable plan. (AMES Bankruptcy News, Issue No. 41;
Bankruptcy Creditors' Service, Inc., 609/392-0900)


AMTROL INC: S&P Junks Credit Rating over Liquidity Concerns
-----------------------------------------------------------
Standard & Poor's Ratings Services lowered its corporate credit
rating on pressure-control products designer, manufacturer, and
marketer AMTROL Inc., to 'CCC+' from 'B-'. The current outlook is
negative.

"The downgrade was prompted by continued tenuous liquidity levels
and very weak operating performance at the company," said Standard
& Poor's credit analyst Cynthia Werneth. "In addition, the actions
reflect the expectation that AMTROL will be unable to raise its
vulnerable credit measures to levels appropriate for the previous
ratings in the near term because sales have stagnated at a low
level." Debt outstanding at March 31, 2003, totaled about $170
million.

The ratings reflect West Warwick, Rhode Island-based AMTROL's well
below-average business position and very aggressive financial
profile. AMTROL is a manufacturer of niche, predominantly high-end
flow control, fluid treatment, and gas storage products used
primarily in water systems and heating, ventilating, and air-
conditioning applications.


ARMSTRONG: AWI Gets Nod to Assume Amended Dow Chemical Contract
---------------------------------------------------------------
Armstrong World Industries, Inc., obtained Judge Newsome's
judicial blessing on its assumption of an executory contract with
The Dow Chemical Company, as amended by a letter agreement dated
April 1, 2003.

                       The Supply Agreement

On January 22, 1999, AWI and Union Carbide Corporation signed a
contract under which Union Carbide agreed to sell to AWI a
material used in the manufacture of the Duracote coatings that are
used on all of the coated residential tile products of AWI and its
subsidiaries. While the Supply Agreement itself is confidential
and not filed with he Court, the terms are described generally in
this Motion.

AWI purchases approximately $1 million of TM 100 annually under
this Supply Agreement.  While the Agreement itself is said to be
confidential and is not included in the Motion, AWI says that the
principal terms of the Supply Agreement are:

       (1) Quantity:  AWI agrees to purchase 100% of its
           requirements (estimated to be 600,000 pounds per year)
           of TM 100 meeting certain specifications;

       (2) Price:  A firm price for all shipments of TM 100 made
           under the Supply Agreement through the calendar year
           2001 is included. In support of AWI's need for price
           stability, price increases during the remaining term
           of the Supply Agreement are limited to one price
           increase per twelve-month period upon thirty days'
           written notice by the supplier;

       (3) Term:  The Supply Agreement continues in effect from
           year to year after December 31, 2002, unless canceled
           on any anniversary of that date by either party upon
           at least sixty days' written notice to the other
           party;

       (4) Product Warranty:  The supplier warrants that TM 100
           will meet the Specifications upon delivery.  AWI is
           under no obligation to purchase any TM 100 that does
           not meet the Specifications, and, to the extent the
           supplier is unable to deliver TM 100 meeting the
           Specifications, AWI is free to purchase its
           requirements from any other supplier, in addition to
           exercising any other remedies to which it may be
           entitled;

       (5) Price Matching: If, during the present remaining term
           of the Supply Agreement, AWI provides the supplier
           with reasonable written evidence that it can purchase
           100% of its requirements for TM 100 meeting the
           Specifications from another manufacturer at a price
           lower than that provided for by the Supply Agreement
           and upon similar terms and conditions, then the
           supplier shall have fifteen days to respond with an
           offer meeting that lower price. If the supplier fails
           to meet the lower price, AWI may (but is not
           obligated to) purchase its requirements for TM 100
           from the other manufacturer by giving the supplier at
           least thirty days' prior written notice; whereupon,
           at the end of that period, the Supply Agreement
           shall be deemed terminated; and

       (6) Payment Terms: AWI is billed at net 30 days. If AWI
           pays its bill within the first ten days, it receives
           a 10% discount off of the purchase price.

                        The Proof of Claim

On January 26, 2001, Union Carbide filed a proof of claim against
AWI asserting an unsecured claim in the amount of $81,800 for
goods sold pre-petition to AWI under the Supply Agreement. On
March 1, 2001, Union Carbide amended its proof of claim,
increasing the claim amount to $161,680.  AWI believes that the
amount claimed pursuant to the Proof of Claim constitutes a valid
claim amount.

                     The 2003 Letter Amendment

On February 6,2001, Union Carbide became a wholly owned subsidiary
of Dow Chemical.  At that time, Dow Chemical became the leading
market entity for TM 100 and continued to fulfill AWI's purchase
orders under the Supply Agreement.  After substantial
negotiations, AWI and Dow Chemical entered into a letter amendment
to the Supply Agreement dated April 1, 2003.  Under the 2003
Letter Amendment, AWI and Dow Chemical have agreed to several new
provisions relating to, inter alia, resolution of Union Carbide's
pre-petition claim as set forth in the Proof of Claim, the
assignment of the Supply Agreement from Union Carbide to Dow
Chemical, and the agreement of Dow Chemical not to increase its
prices under the Supply Agreement unless hardship is proven as a
result of "extraordinarily high energy prices."

Specifically, the 2003 Letter Amendment provides:

       (a) Assignment:  Pursuant to the 2003 Letter Amendment,
           Dow Chemical acknowledges that Union Carbide has
           assigned the Supply Agreement to Dow Chemical.  AWI
           consents to that assignment.  Neither AWI nor Dow
           Chemical may assign the Amended Supply Agreement
           without obtaining prior written consent from the
           other party;

       (b) Pre-petition Settlement: Upon the Court's approval
           of AWI's assumption of the Amended Supply Agreement,
           AWI will make a cash payment to Dow Chemical in the
           amount of $89,000, in full settlement of all
           pre-petition claims asserted against AWI in the Proof
           of Claim and in full satisfaction of AWI's obligation
           to cure defaults under the Bankruptcy Code;

       (c) Withdrawal of Proof of Claim:  Dow Chemical will
           withdraw, or cause Union Carbide to withdraw, the
           Proof of Claim with prejudice after AWI's assumption
           of the Amended Supply Agreement is approved by the
           Court;

       (d) Quantity: Dow Chemical and AWI acknowledge that the
           Supply Agreement is a 100% requirements contract,
           exclusive of test quantities of materials AWI deems
           necessary for contingency purposes.  In this regard,
           AWI will inform Dow Chemical of test quantities used
           within thirty days, and will provide Dow Chemical with
           estimates of its requirements for TM 100 for planning
           purposes only;

       (e) Term:  The term of the Supply Agreement will continue
           in effect through December 31, 2004. The term will
           extend year to year thereafter, subject to the right
           of either party to terminate the agreement upon at
           least sixty days' prior written notice.  Beginning
           January 1, 2004, and continuing annually for as long
           as the Amended Supply Agreement is in effect, if Dow
           Chemical announces a price increase under the Amended
           Supply Agreement between November 1 of the current
           year and January 31 of the following year, AWI will
           have an additional sixty days from the date of any
           announcement to provide Dow Chemical with written
           notice of cancellation;

       (f) Price: Except as provided in a hardship clause set
           forth in the 2003 Letter Agreement, the Amended Supply
           Agreement continues to provide, through December 31,
           2004, the same firm price for TM 100 stated in the
           January 22, 1999 Contract.  Additionally, with respect
           to AWI's need for price stability, price increases
           during the remaining term of the Amended Supply
           Agreement will continue to be limited to one per
           twelve-month period, and will require 45 days'
           written notice from Dow Chemical; and

       (g) Payment Terms: 1% discount if paid within ten days;
           upon conversion to electronic funds transfer, the
           payment will be discounted by 1% if paid within
           fifteen days of EFT, with payment received on the
           due date. EFT may be provided by an outside service
           if both parties agree. (Armstrong Bankruptcy News,
           Issue No. 45; Bankruptcy Creditors' Service, Inc.,
           609/392-0900)


ATCHISON CASTING: First Creditors' Meeting Slated for October 1
---------------------------------------------------------------
The United States Trustee will convene a meeting of Atchison
Casting Corporation and its debtor-affiliates' creditors on
October 1, 2003, 1:00 p.m., at US Courthouse, Room 2110A, 400 E.
9th St., Kansas City, Missouri.  This is the first meeting of
creditors required under 11 U.S.C. Sec. 341(a) in all bankruptcy
cases.

All creditors are invited, but not required, to attend. This
Meeting of Creditors offers the one opportunity in a bankruptcy
proceeding for creditors to question a responsible office of the
Debtor under oath about the company's financial affairs and
operations that would be of interest to the general body of
creditors.

Atchison Casting Corporation, headquartered in St. Joseph,
Missouri, together with its affiliates, produce iron, steel and
non-ferrous castings and machining for a wide variety of
equipment, capital goods and consumer markets. The Company filed
for chapter 11 protection on August 4, 2003 (Bankr. W.D. MO. Case
No. 03-50965).  Mark G. Stingley, Esq., and Cassandra L. Writz,
Esq., at Bryan Cave LLP represent the Debtors in their
restructuring efforts.  When the Company filed for protection from
its creditors, it listed $136,750,000 in total assets and
$96,846,000 in total debts.


BLOUNT INT'L: June 30 Balance Sheet Upside-Down by $368 Million
---------------------------------------------------------------
Blount International, Inc., (NYSE: BLT) reported results for the
second quarter ended June 30, 2003. Sales for the quarter were
$131.2 million, a 6.4% increase from sales in last year's second
quarter. Net loss for the quarter was $0.7 million compared to a
net income of $0.5 million in 2002. This quarter's net loss
includes $2.8 million in pre-tax charges related to the
extinguishment of debt in connection with the procurement of a new
credit facility in May. This charge was partially offset by a $0.1
million increase in income from operations, a $0.4 million
reduction in interest expense and reduced income taxes of $0.7
million.

At June 30, 2003, the Company's balance sheet shows a total
shareholders' equity deficit of about $368 million.

                       First Half Results

The Company's sales through the first six months of 2003 were
$254.1 million, an increase of 10.5% from 2002. The sales growth
was primarily a result of a 15.3% increase in sales in our largest
segment, the Outdoor Products segment. Net loss for the first half
was $0.2 million compared to a net loss of $6.0 million for the
comparable period last year. The improvement in net loss is due to
a $9.5 million improvement in income from operations and lower
interest expense of $1.0 million, partially offset by an increase
in charges related to the extinguishment of debt of $2.5 million
and a lower income tax benefit of $2.8 million. Last year's first
six months operating income was negatively impacted by $5.5
million in restructuring expense related to the closure and
relocation of the Company's corporate headquarters.

Commenting on the second quarter results, James S. Osterman,
President and Chief Executive Officer, stated, "Overall our sales
trends were similar to what we experienced in the first quarter.
We continue to see the impact of greater demand and favorable
currency effects on the sales in our Outdoor Products segment, a
modest increase in sales within our Industrial and Power Equipment
segment and a general weakness in the Lawnmower segment.
Profitability was flat from last year, as the combination of
higher selling and administrative costs, related in part to higher
employee benefit costs, and the reduced Lawnmower sales offset the
sales gains achieved in the Outdoor Products segment. As we look
forward to the second half of the year, we expect to see the
Outdoor Products segment sales and profit growth to moderate
somewhat and the Industrial and Power Equipment segment to improve
seasonally as well as begin to show the gains from our new
marketing alliance with Caterpillar. With minimal improvement in
the Lawnmower segment anticipated, the Company's second half
income from operations is expected to be either in line or
slightly better than last year. In the second quarter we also
successfully refinanced our Senior Credit Facility."

                         Segment Results

The Outdoor Products segment reported second quarter sales of
$87.9 million, a 14.2% increase from last year's sales of $77.0
million. Operating income for this segment was $21.1 million, a
22.0% increase from last year's $17.3 million. Sales continue to
reflect strength in all major geographical markets, with European
market sales increasing the most significantly. The weaker US
Dollar this year in comparison to last year's second quarter
continues to benefit this segment's sales and profit results.
Additionally, the increase in sales has improved plant capacity
leverage from a year ago. Backlog at the end of the second quarter
totaled $57.9 in comparison to $33.0 million last year. Segment
sales for the first six months were $173.1 million compared to
$150.1 million last year. Operating income through June of this
year was $42.9 million compared to $33.7 million last year.

The Lawnmower segment recorded second quarter sales of $10.2
million compared to $13.5 million for the same period last year.
Operating income in this segment was $0.4 million, a decrease from
last year's $1.6 million. This weaker performance can be
attributed to a reduction in unit shipments as both competitive
conditions and unfavorable weather patterns impacted spring sales.
Backlog is seasonally low at $0.1 million, equal to last year. The
market conditions in this segment remain difficult with
significant competition and general economic concerns. Through the
first six months of 2003 the Lawnmower segment's sales have
totaled $18.1 million in comparison to $21.3 million last year.
Operating loss in 2003 was $0.3 million compared to operating
income of $1.3 million last year. Most of the lawnmower products
have been remodeled for the new model year. Early comments from
our customers are positive.

The Industrial and Power Equipment segment's second quarter sales
increased slightly to $33.2 million from $32.8 million last year.
The sales increase was limited by a decline in the sales of gear
components for the same period last year. Operating income totaled
$0.9 million in the second quarter of this year compared to $1.4
million last year. Competitive discounting and weak gear component
sales were the major reasons of this profit decline. Backlog for
this segment as of the end of June was $28.5 million, up from
$15.3 million in 2002. Year to date segment sales were $63.1
million, a 6.4% increase from last year. Segment operating profit
for the first six months was $0.9 million compared to $1.7 million
last year.

Blount International, Inc. is a diversified international company
operating in three principal business segments: Outdoor Products,
Lawnmower and Industrial and Power Equipment. Blount
International, Inc. sells its products in more than 100 countries
around the world. For more information about Blount International,
Inc., visit http://www.blount.com


BUDGET GROUP: Wants Lease Decision Period Extended to Sept. 29
--------------------------------------------------------------
Budget Group Inc., and its debtor-affiliates have largely
completed the process of evaluating each of the unexpired non-
residential property leases for their economic desirability and
compatibility with their Chapter 11 process and have already
obtained the Court's authority to assume and assign, or reject the
vast majority of their unexpired leases.

In particular, since the Petition Date, the Debtors have expended
considerable time and resources on consummating the North
American Sale, which included the assumption and assignment of
more than 7,000 contracts, including a majority of the Debtors'
unexpired non-residential real property leases.  In addition, the
Debtors sought and obtained the Court's authority to reject
several unnecessary and economically improvident leases.
Accordingly, the Debtors have made considerable progress in
evaluating their executory contracts and unexpired leases as part
of their overall Chapter 11 process.

By this motion, the Debtors ask the Court to further extend their
decision period through and including September 29, 2003.

Edmon L. Morton, Esq., at Young, Conaway, Stargatt & Taylor, LLP,
in Wilmington, Delaware, asserts that while the Debtors have made
tremendous progress in evaluating their unexpired leases, the
extension of time will provide them with the means to complete
that process.  For instance, the Debtors' car rental business
outside of North America is operated through BRAC Rent-A-Car
International, Inc, and its debtor and non-debtor subsidiaries.
BRACII continues to manage certain operations and the Debtors
have identified a small number of Unexpired Leases, which remain
to be evaluated, to which BRACII is a party.

In addition, given the inherent fluidity in the operation of a
large, complex multinational business enterprise like those of
the Debtors, there may be additional Unexpired Leases that they
have not yet identified.  As a result, the Debtors need the
additional time to evaluate their remaining Unexpired Leases and
to ensure that all Unexpired Leases have been identified.

Mr. Morton asserts that cause exists to extend the lease decision
period to allow the evaluation process to continue.

Notably, since the sale of substantially all of their assets, the
Debtors continue to manage and resolve certain administrative,
corporate and bankruptcy issues that have accompanied the going
concern sale of their multi-billion dollar operations, including
myriad issues arising in connection with their executory
contracts and unexpired leases.  For example, in connection with
the North American Sale, the Debtors have previously identified
in their records certain executory contracts and unexpired leases
not originally identified in the Asset and Stock Purchase
Agreement and, as a result, have had to prepare and file
subsequent motions with the Court seeking either the assumption
and assignment or rejection of various executory contracts and
unexpired leases.  The Debtors believe that the additional time
will allow them to identify any remaining Unexpired Leases and
determine the most effective and efficient manner for dealing
with these leases.

Mr. Brady adds that an extension will allow the Debtors to
maintain the maximum flexibility in seeking to implement their
Chapter 11 plan successfully and maximize the value of their
estates.

The Court will convene a hearing on August 18, 2003 to consider
the Debtors' request.  By application of Del.Bankr.LR 9006-2, the
lease decision period is automatically extended through the
conclusion of that hearing. (Budget Group Bankruptcy News, Issue
No. 24; Bankruptcy Creditors' Service, Inc., 609/392-0900)


BURLINGTON: Liquidation Analysis Under First Amend Ch. 11 Plan
--------------------------------------------------------------
Burlington Industries' Amended Plan of Reorganization will provide
hypothetical Liquidation Values of the Debtors' interests in
property, on a consolidated basis, assuming a Chapter 7
liquidation in which a trustee appointed by the Bankruptcy Court
would liquidate the Debtors' properties and interests in the
property.

John D. Englar, Senior Vice President of Burlington Industries,
Inc., explains distributions to Claim holders would be made
substantially later than the Effective Date assumed in connection
with the Plan.  This delay would materially reduce the amount
determined on a present value basis available for distribution to
creditors, including Unsecured Claim holders.  The hypothetical
Chapter 7 liquidation of the Debtors is assumed to commence on
October 30, 2003 and on a consolidated basis for the Debtors
resulting in the elimination of certain intercompany claims,
assumes that distributions are made by a Chapter 7 trustee
beginning as soon as practicable after commencement of the
liquidation and completed within 18 months of commencement.

According to Mr. Englar, a Chapter 7 liquidation would result in
substantial diminution in the value to be realized by claim
holders against the Debtors, as compared to the proposed
distributions under the Plan, because of:

   (a) the failure to realize the maximum going concern value of
       the Debtors' assets;

   (b) the substantial negative impact of conversion to a Chapter
       7 case and subsequent liquidation of the Debtors'
       employees and customers;

   (c) additional costs and expenses involved in the appointment
       of trustees, attorneys, accountants and other
       professionals to assist the trustees in the Chapter 7
       cases;

   (d) additional expenses and claims, some of which would be
       entitled to priority in payment, which would arise by
       reason of the liquidation and from the rejection of
       Executory Contracts and Unexpired Leases in connection
       with a cessation of the Debtors' operations; and

   (e) the substantial time that would elapse before entities
       would receive any distribution in respect of their Claims.

Consequently, the Debtors believe that the Plan will provide a
substantially greater ultimate return to Claim holders against
the Debtors than would a Chapter 7 liquidation. (Burlington
Bankruptcy News, Issue No. 37; Bankruptcy Creditors' Service,
Inc., 609/392-0900)


CHOICE ONE: June 30 Net Capital Deficit Balloons to $576 Million
----------------------------------------------------------------
Choice One Communications (OTC Bulletin Board: CWON), an
Integrated Communications Provider offering facilities-based voice
and data telecommunications services, including Internet and DSL
solutions, to businesses in 29 Northeast and Midwest markets,
announced financial and operational results for second quarter
2003.

"We are extremely pleased with our second quarter results,"
commented Steve Dubnik, Chairman and Chief Executive Officer. "We
had positive cash flow for the month of June and reported positive
adjusted EBITDA for the third consecutive quarter. Importantly,
our second quarter results showed top-line growth, gains in market
penetration and continued strong control over our operating
expenses and capital spending."

"This is a very exciting time for Choice One. Five years ago, we
started this company with a sound business plan. We have remained
committed to that plan, have focused on our clients, managed our
growth and managed our vital cash resources. In five years' time,
we have built a company that provides high quality bundled
telecommunications services to more than 100,000 business clients
in 12 states. Our growth to date is the culmination of countless
individual accomplishments during the past five years and the
efforts of many dedicated Choice One colleagues."

Revenue was $82.2 million for the second quarter, up 12% from
second quarter 2002 revenue of $73.2 million and up 3% from first
quarter 2003 revenue of $80.1 million. Network costs continue to
benefit from the company's robust and efficient fiber optic
network and ongoing network optimization initiatives. Revenue less
network costs was $40.9 million, or 49.7% of revenue for the
second quarter, compared with $32.8 million, or 44.8% of revenue a
year ago and $39.6 million, or 49.4% of revenue for first quarter
2003. The company's second quarter results reflect continued
strong focus on operating expenses. Second quarter selling,
general and administrative expenses were down 4% from first
quarter 2003 and were down 38% from a year ago. SG&A expenses were
$30.5 million, or 37.2% of revenue in second quarter 2003 compared
with $31.9 million, or 39.8% of revenue in first quarter 2003 and
$49.2 million, or 67.2% of revenue in second quarter 2002. Second
quarter 2002 SG&A expenses included $11.8 million to increase bad
debt reserves for certain specific telecommunications carriers. At
June 30, 2003, Choice One had 1,323 total colleagues, compared
with 1,410 at March 31, 2003 and 1,801 a year ago.

Adjusted EBITDA was $10.3 million, or 12.6% of revenue, in second
quarter 2003, up 26% from adjusted EBITDA of $8.2 million, or
10.3% of revenue in first quarter 2003. The company reported
adjusted EBITDA losses of $16.4 million a year ago. Capital
expenditures were $2.1 million for the quarter, compared with $1.9
million in first quarter 2003 and $5.7 million a year ago. Cash
interest expense, which excludes interest payable in kind, was
$7.5 million for the second quarter, compared with $7.4 million
for first quarter 2003 and $7.7 million for second quarter 2002.

The company reported free cash flow of $0.7 million for the
quarter, achieving positive free cash flow for the first time in
the company's history. Changes in working capital represented a
$6.8 million use of cash during the quarter, primarily related to
reducing the company's accounts payable and accrued expenses
balance. Total cash utilization for the quarter was $6.1 million,
down 40% from first quarter cash utilization of $10.1 million and
down 66% from $17.8 million in second quarter 2002. The company
had positive cash flow for the month of June. Although not
necessarily indicative of future cash flow results, this was the
first time the company experienced positive monthly cash flow. The
company exited June with total liquidity of $16.7 million,
including $15.0 million of cash and $1.7 million available on its
credit facility.

Net loss applicable to common stockholders was $36.6 million, or
$0.68 per share, compared with $38.6 million, or $0.72 per share,
in first quarter 2003 and $349.8 million, or $8.17 per share, a
year ago. Second quarter 2002 loss per share included $11.8
million to increase bad debt reserves for certain specific
telecommunications carriers and $283.3 million related to the
impairment loss on certain intangible assets.

At June 30, 2003, the Company's balance sheet shows a total
shareholders' $576 million.

                 Sales and Operating Highlights

At June 30, 2003, the company's market penetration was estimated
at 8.4% of addressable business lines, compared with 7.5% a year
ago. With more than 100,000 clients and more than half a million
lines in service, client service and satisfaction continues to be
a primary focus for the company. The company's average monthly
attrition rate of facilities based lines was approximately 1.4%
during the second quarter and was consistent with recent quarters.

The company's new bundled service plans, Select Savings, which
were introduced during the first quarter, have been well received
by clients and prospective clients. Select Savings offers
substantial incremental cost savings for clients who subscribe to
multiple services or those with above-average usage and offers
substantial benefits compared with other competitive offerings.
The company's penetration of high-speed Internet services (DSL and
T-1), available throughout its 29-market operating footprint, is
20% higher for clients with Select Savings compared with the
company's legacy plans.

The company continues to focus sales and marketing efforts on
increasing its market penetration, including that of multi-
location businesses. Additionally, during the quarter the company
renewed its focus on its business partner channel, signing 84 new
business partners under its aggressive new "Fast Start Program".

"Choice One continues to grow and successfully sell our bundled
service offering to businesses across our footprint," added Mr.
Dubnik. "This clearly demonstrates the benefits of our Select
Savings plans, our focus on client service and the quality of our
telecommunications network."

Headquartered in Rochester, New York, Choice One Communications
Inc. (OTC Bulletin Board: CWON) is a leading integrated
communications services provider offering voice and data services
including Internet and DSL solutions, to businesses in 29
metropolitan areas (markets) across 12 Northeast and Midwest
states. Choice One reported $290 million of revenue in 2002, has
more than 100,000 clients and employs approximately 1,300
colleagues.

Choice One's markets include: Hartford and New Haven, Connecticut;
Rockford, Illinois; Bloomington/Evansville, Fort Wayne,
Indianapolis, South Bend/Elkhart, Indiana; Springfield and
Worcester, Massachusetts; Portland/Augusta, Maine; Grand Rapids
and Kalamazoo, Michigan; Manchester/Portsmouth, New Hampshire;
Albany (including Kingston, Newburgh, Plattsburgh and
Poughkeepsie), Buffalo, Rochester and Syracuse (including
Binghamton, Elmira and Watertown), New York; Akron (including
Youngstown), Columbus and Dayton, Ohio; Allentown, Erie,
Harrisburg, Pittsburgh and Wilkes-Barre/Scranton, Pennsylvania;
Providence, Rhode Island; Green Bay (including Appleton and
Oshkosh), Madison and Milwaukee, Wisconsin.

The company has intra-city fiber networks in the following
markets: Hartford, Connecticut; Rockford, Illinois;
Bloomington/Evansville, Fort Wayne, Indianapolis, South
Bend/Elkhart, Indiana; Springfield, Massachusetts; Grand Rapids
and Kalamazoo, Michigan; Albany, Buffalo, Rochester and Syracuse,
New York; Columbus, Ohio; Pittsburgh, Pennsylvania; Providence,
Rhode Island; Green Bay, Madison and Milwaukee, Wisconsin.

For further information about Choice One, visit its Web site at
http://www.choiceonecom.com


CITGO PETROLEUM: Improved Liquidity Spurs Fitch to Up Ratings
-------------------------------------------------------------
Fitch Ratings has upgraded the senior unsecured debt rating of
CITGO Petroleum Corporation to 'BB-' from 'B+' and the rating of
CITGO's $200 million secured term loan to 'BB+' from 'BB'. With
the payment of the $500 million maturity of senior notes on
August 1, Fitch is withdrawing its rating on PDV America, Inc.
CITGO is owned by PDV America, an indirect, wholly owned
subsidiary of Petroleos de Venezuela S.A., the state-owned oil
company of Venezuela. The Rating Outlook for the debt of CITGO is
Stable.

The rating action recognizes the continued improvement in CITGO's
liquidity position since the general strike in Venezuela and the
company's strong operating performance over the last several
months. Despite the 63-day national strike in Venezuela that
lasted from December 2002 through February 2003, CITGO's
refineries have continued to perform well, generating significant
EBITDA and free cash flow for the company. Based on CITGO's new
credit profile, Fitch would expect the company to generate EBITDA-
to-interest coverage of approximately 5.0 times (x) during a mid-
cycle margin environment.

The ratings, however, also reflect the potential for further
interference from PDVSA as CITGO enters a period of high capital
requirements to meet the upcoming low sulfur regulations. CITGO
estimates the total capital expenditures to meet environmental
regulations to be approximately $1.3 billion over the next five
years. Financial flexibility could be limited by further dividend
payments or additional force majeure situations interrupting
CITGO's supply of heavy Venezuelan crude. As discussed in previous
reports, the indentures of CITGO's recent $550 million bond
offering do place significant restrictions on future dividend
payments. Fitch will evaluate future upstreaming of dividends to
PDVSA from CITGO and take appropriate rating actions if necessary.

Despite the company's strong performance, CITGO's credit profile
also reflects the addition of the $550 million of 11-3/8% senior
unsecured notes and the $200 million secured term loan which were
added earlier this year. On July 25, 2003, CITGO paid $500 million
in dividends to PDV America which was used to pay for the maturity
of PDV America's $500 million senior notes which matured on August
1. Fitch has viewed the PDV America senior notes to ultimately be
an obligation of PDVSA which were supported by Mirror Notes issued
by PDVSA and held by PDV America. Following the dividend, CITGO
had approximately $518 million available on its revolving credit
facility and $8 million in cash.

CITGO is one of the largest independent crude oil refiners in the
United States with three modern, highly complex crude oil
refineries and two asphalt refineries with a combined capacity of
756,000 barrels per day. The company also owns approximately 41%
interest in LYONDELL-CITGO Refining L.P., a limited liability
company that owns and operates a 265,000-barrel per day crude oil
refinery in Houston, Texas. CITGO branded fuels are marketed
through approximately 13,000 independently owned and operated
retail sites.


COMMSCOPE INC: Second-Quarter Net Loss Slides-Up to $51 Million
---------------------------------------------------------------
CommScope, Inc. (NYSE: CTV) (S&P, BB Corporate Credit & B+
Subordinated Debt Ratings, Stable) announced second quarter
results for the period ended June 30, 2003.

The Company reported sales of $141.4 million and a net loss of
$51.4 million, or $0.87 per share, for the second quarter. The net
loss included CommScope's after-tax impairment charges of $0.34
per share and after-tax equity in losses of OFS BrightWave, LLC of
$0.57 per share related to CommScope's minority ownership interest
in this venture.

For the second quarter of 2002, the Company incurred a net loss of
$42.5 million, or $0.69 per share, which included: a) after-tax
charges of $12.9 million, or $0.21 per share, related to
CommScope's write-off of Adelphia Communications Corp.,
receivables; and b) after-tax charges of $34.9 million, or $0.56
per share, of equity in losses of OFS BrightWave.

CommScope's sales for the second quarter of 2003 were $141.4
million, compared to $155.0 million in the year-ago quarter and
$129.4 million in the first quarter of 2003. The sequential
increase in sales was primarily due to increased sales to
broadband service providers other than Comcast Corporation,
stronger Wireless sales and improved LAN sales. The year-over-year
sales decline was due to lower global Broadband/Video sales.

Orders booked in the second quarter of 2003 were $138.4 million,
compared to $157.2 million in the second quarter of 2002 and
$135.1 million in the preceding quarter.

Despite rising material costs, total Company gross margin for the
quarter rose about 170 basis points sequentially to 20.4%
primarily due to increased sales volumes. Gross margin in the
second quarter of 2002 was 20.5%.

Chairman and Chief Executive Officer Frank M. Drendel said, "In
the midst of a challenging business environment with limited
visibility, we are pleased to have increased sales and gross
margin sequentially. Despite significant charges during the
quarter, we generated $18.4 million in cash from operations."

                      Impairment Charges

During the second quarter of 2003, the Company concluded that
certain of its manufacturing assets had no future use in
operations as a result of ongoing weak global business conditions.
These assets, primarily used for broadband cable manufacturing,
included uninstalled, underutilized and idle fixed assets in the
United States and in CommScope's Brazilian facility.

CommScope recognized pretax impairment charges for fixed assets of
$31.7 million, or $0.34 per share, during the second quarter.
These charges included:

* $21.4 million for domestic broadband cable manufacturing assets
*  $8.7 million for Brazilian manufacturing assets
*  $1.6 million for other domestic manufacturing assets

                      OFS BrightWave Results

For the second quarter of 2003, OFS BrightWave had revenues of
$21.8 million, a negative gross profit of $41.8 million and a net
loss of $292.6 million. The net loss included charges of $257.9
million primarily related to fixed asset impairment, restructuring
and cost reduction efforts.

CommScope recorded after-tax charges of $33.9 million, or $0.57
per share, in the second quarter of 2003 for equity in losses of
OFS BrightWave related to the Company's minority investment in
this venture.

The Furukawa Electric Co., Ltd. (Tokyo: 5801) previously announced
a major global review of its optical fiber and fiber optic cable
operations, which include OFS BrightWave. Furukawa also indicated
that restructuring, special charges and job cuts might be
necessary at certain manufacturing facilities during 2003 in order
to reduce its cost structure. As part of the restructuring
process, Furukawa reported that it plans to close the OFS
BrightWave manufacturing facility in Brazil.

"We believe that OFS BrightWave has lowered its cost structure as
a result of the restructuring during the second quarter," said
Drendel. "However, CommScope expects ongoing pricing pressure and
weak demand industry wide for fiber optic cable products at least
through 2003. As a result, we continue to expect OFS BrightWave to
incur losses at least through 2003."

               Other Second Quarter 2003 Highlights

* Broadband/Video sales of $108.5 million were down 13% from the
  second quarter of last year, but rose 7% sequentially. Sales to
  Comcast represented approximately 17% of total Company sales for
  the quarter and were down $6 million sequentially. The year-
  over-year decline primarily resulted from lower sales to Charter
  Communications, Inc., as well as lower international and fiber
  optic cable sales. Worldwide Broadband/Video orders for the
  quarter were $106.7 million.

* International sales grew 8% sequentially to $27.2 million, but
  remained below year-ago levels of $33.9 million. International
  orders for the second quarter were $26.6 million.

* LAN sales increased 7% year-over-year and sequentially to $24.6
  million. LAN sales benefited from improved project business and
  increasing fiber optic cable and apparatus sales. LAN orders for
  the quarter were $23.0 million.

* Wireless/Other Telecom sales were $8.3 million, up 63%
  sequentially and up 20% from the second quarter of 2002.
  CommScope has made steady progress communicating the Cell Reachr
  value proposition to customers and remains optimistic about
  long-term wireless opportunities. Wireless/Other Telecom orders
  were $8.7 million for the quarter.

* Selling, general and administrative expense was $21.8 million in
  the second quarter of 2003, compared to $20.1 million in the
  preceding quarter. SG&A was $41.1 million in the second quarter
  of 2002 and included pretax charges of $20.5 million for the
  write-off of Adelphia receivables.

* Net cash provided by operating activities in the quarter was
  $18.4 million. Capital spending for the quarter was $0.7
  million. The Company expects capital spending to be about $10
  million for calendar year 2003.

* CommScope ended the second quarter of 2003 with $140.3 million
  in cash and cash equivalents, up from $121.7 million at the end
  of the first quarter.

                            Outlook

"While we see some signs of market stabilization, we remain
cautious in our sales outlook and expect ongoing cost pressures,
primarily related to the cost of polyethylene and other plastics,"
said Jearld L. Leonhardt, Executive Vice President and Chief
Financial Officer. "As a result, we expect that CommScope's third
quarter 2003 sales and gross margin will be slightly lower than to
consistent with second quarter 2003 levels.

"Regarding cash flow, we expect to continue generating free cash
flow (cash flow from operations less capital expenditures) during
the second half of 2003. During July we received a $13.5 million
tax refund primarily related to the carryback of 2002 deductible
losses from OFS BrightWave and the write-off of Adelphia
receivables."

CommScope is the world's largest manufacturer of broadband coaxial
cable for Hybrid Fiber Coaxial applications and a leading supplier
of high-performance fiber optic and twisted pair cables for LAN,
wireless and other communications applications. Through its
relationship with OFS, CommScope has an ownership interest in one
of the world's largest producers of optical fiber and cable and
has access to a broad array of connectivity components as well as
technologically advanced optical fibers, including the zero water
peak optical fibers used in the production of the LightScope ZWPTM
family of products.


CONSECO INC: Wants Go-Signal to Assume Hylant Purchase Agreement
----------------------------------------------------------------
On June 12, 2002, Conseco agreed to sell the assets of Conseco
Risk Management to Hylant of Indianapolis, LLC and Hylant Group,
Inc.  After the Petition Date, the Conseco Inc. Debtors gave
notice of their intention to assume the Purchase Agreement.
Through subsequent negotiations, Conseco has negotiated a sale on
more favorable terms and entered into an amended Agreement on
July 14, 2003.

Under the original Purchase Agreement, $2,500,000 was held in
reserve as a Holdback.  Assuming Conseco conducted a certain
level of annual business with Hylant, it would be able to earn
$500,000 of the Holdback over the next five years.  If Conseco
fell short, it would risk its right to receive all or part of the
Holdback.  Under other terms, Conseco was obligated to pay Hylant
if it fell short of a minimum business requirement.

But James H.M. Sprayregen, Esq., at Kirkland & Ellis, says that
with the sale of the Finance Company business, Conseco expects
that the annual business it can give Hylant will be reduced,
making it more difficult to earn the Holdback.  It is more likely
that it will have to pay the penalties for failing to meet
minimum business requirements under the Agreement.

Under the Amended Purchase Agreement, Mr. Sprayregen tells the
Court that Conseco can earn the Holdback under expanded terms and
the minimum business requirements have been lowered.  Further,
the penalty provision has been removed, meaning Conseco no longer
faces prospective liability for failing to meet minimum business
requirements.  In view of these more amiable terms, the Debtors
ask the Court to assume the Amended Purchase Agreement.

The Asset Purchase Agreement provides these material terms:

  -- Purchase Price: $11,017,500 plus Assumed Liabilities
  -- Assumed Liabilities: $6,694,565
  -- Cash Payment: $8,517,500 minus Receivable Holdback
  -- Holdback: $2,500,000
  -- Receivable Holdback: $350,000
(Conseco Bankruptcy News, Issue No. 29; Bankruptcy Creditors'
Service, Inc., 609/392-0900)


CORRPRO COS.: Completes Amendments to Senior Debt Agreements
------------------------------------------------------------
Corrpro Companies, Inc. (Amex: CO) has amended its senior debt
agreements to extend the term of its revolving credit facility
with the bank group led by Bank One, NA and to reschedule
principal amortization payments under its senior notes held by The
Prudential Insurance Company of America.

The amendments also waive previously reported loan covenant
violations. As a result of these amendments, the Company is now in
compliance with its senior debt agreements. The amendments provide
for deferral of principal payments on the senior notes until
October 31, 2003 and extension of the maturity of the revolving
credit facility until October 31, 2003, subject to refinancing
milestones being achieved.

Commenting on the announcement, Joseph W. Rog, Chairman, CEO and
President, said, "We are pleased to have successfully completed
agreements with our lenders that allow us, assisted by our
investment bankers, to continue our search for alternative capital
financing sources. We are actively engaged in discussions with
other qualified capital and financing sources who have expressed
interest in our efforts to recapitalize our balance sheet and
refinance our outstanding debt. This process is ongoing and there
can be no assurances given at this time as to the ultimate outcome
or terms of our efforts in this regard."

Corrpro, headquartered in Medina, Ohio is the leading provider of
corrosion control engineering services, systems and equipment to
the infrastructure, environmental and energy markets around the
world. Corrpro is the leading provider of cathodic protection
systems and engineering services, as well as the leading supplier
of corrosion protection services relating to coatings, pipeline
integrity and reinforced concrete structures.


COVANTA: Exclusivity Extension Hearing Adjourned Until Today
------------------------------------------------------------
U.S. Bankruptcy Court Judge Blackshear adjourns the hearing on the
Covanta Energy Debtors' request to extend their exclusive period
to file a Plan and their exclusive period to solicit acceptances
of that plan until August 13, 2003.  Accordingly, the Court
extends the exclusive periods until August 14, 2003. (Covanta
Bankruptcy News, Issue No. 33; Bankruptcy Creditors' Service,
Inc., 609/392-0900)


DIGITALNET: S&P Says $86MM Public Offering Won't Affect Ratings
---------------------------------------------------------------
DigitalNet Inc. (B+/Positive/--) has filed an $86 million initial
public offering with the SEC. Proceeds will be used to pay off
about $48 million in debt and for general corporate purposes.
Standard & Poor's Ratings Services does not expect this to have an
effect on DigitalNet's ratings. Although this transaction, if
completed, will improve DigitalNet's financial profile, the
company already had a moderate debt burden for its rating.

DigitalNet's ratings reflect the Bethesda, Maryland-based
company's niche focus, partly offset by moderate but predictable
earnings and cash flow. DigitalNet's ratings outlook remains
positive. Ratings could be raised over the longer term as the
company increases its business base and demonstrates sustained
balance-sheet improvement.


DRYDEN IV-LEVERAGED: S&P Assigns BB Rating to Class D Notes
-----------------------------------------------------------
Standard & Poor's Ratings Services assigned its preliminary
ratings to Dryden IV-Leveraged Loan CDO 2003's $330 million fixed-
and floating-rate notes and preferred shares due 2015.

The preliminary ratings are based on information as of Aug. 11,
2003. Subsequent information may result in the assignment of final
ratings that differ from the preliminary ratings.

The preliminary ratings reflect:

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

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

-- The experience of the collateral manager; and

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

Dryden IV is the eighth cash flow arbitrage CDO managed by
Prudential Investment Management Inc.

                    PRELIMINARY RATINGS ASSIGNED

                  Dryden IV-Leveraged Loan CDO 2003

               Class           Rating    Amount (mil. $)
               A               AAA                   257
               B               A-                     26
               C-1             BBB                     7
               C-2             BBB                     6
               D               BB                      8
               Pref. shares    N.R.                   26
               Comb. secs 1    N.R.                    3
               Comb. secs 2    N.R.                    6
               Comb. secs 3    N.R.                    8
               N.R.-Not rated.


DYNEGY: Closes Refinancing Deals and ChevronTexaco Restructuring
----------------------------------------------------------------
Dynegy Inc. (NYSE:DYN) has closed a series of refinancing and
restructuring transactions, including (a) the offering of $1.45
billion in second priority senior secured notes and $175 million
in convertible subordinated debentures (the pricing of which was
announced on Aug. 1) and (b) the exchange of the $1.5 billion
Series B Preferred Stock previously held by a subsidiary of
ChevronTexaco Corp. Dynegy also received approximately $40 million
from ChevronTexaco relating to the return of certain pre-payment
amounts previously held by ChevronTexaco.

The net proceeds from the refinancing transactions, together with
existing cash on hand, were used to:

-- Repay the $200 million Term A loan in full and repay
   approximately $115 million of the $360 million Term B loan
   outstanding under Dynegy's restructured credit facilities;

-- Purchase approximately $612 million of the company's senior
   notes due in 2005 and 2006 through a previously announced
   tender offer, which expired on Friday, Aug. 8;

-- Repay the $696 million outstanding under a secured financing
   tied to Dynegy's Midwest generation assets;

-- Make the $225 million cash payment to ChevronTexaco in
   connection with the exchange of Dynegy's Series B Preferred
   Stock; and

-- Pay certain transaction fees and related expenses.

Dynegy has granted the initial purchasers of the convertible
subordinated debentures an option to purchase up to an additional
$50 million of convertible subordinated debentures. The option
remains exercisable through Aug. 31, 2003.

The convertible subordinated debentures are not registered under
the Securities Act of 1933, or any state securities laws.
Therefore, the convertible subordinated debentures subject to the
initial purchasers' over-allotment option may not be offered or
sold in the United States absent registration or an applicable
exemption from the registration requirements of the Securities Act
of 1933 and any applicable state securities laws. This news
release is neither an offer to sell nor a solicitation of any
offer to buy these convertible subordinated debentures.

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.

As reported in Troubled Company Reporter's August 5, 2003 edition,
Fitch Ratings assigned a 'B' rating to Dynegy Holdings Inc.'s
$700 million 10.125% second priority senior secured notes due
2013, $520 million 9.875% second priority senior secured notes due
2010, and $225 million floating rate second priority senior
secured notes due 2008 priced at Libor plus 6.50%.

Fitch also assigned a 'CCC+' rating to Dynegy Inc.'s $175 million
4.75% convertible subordinated debentures due 2023. DYN's
convertible debentures are guaranteed on a senior unsecured basis
by DYNH. The DYNH Notes and the DYN convertible debentures are
being sold through private placement. In addition, DYNH's
outstanding $360 million Term B loan is upgraded to 'B+' from 'B'
as a result of improved collateral coverage following application
of the Note proceeds. The Rating Outlook for the DYN and its
affiliates is changed to Positive from Stable.


EQUITY INNS: Completes 8.75% Series B Preferred Shares Offering
---------------------------------------------------------------
Equity Inns, Inc. (NYSE: ENN) (S&P, B+ Corporate Credit Rating,
Negative) has completed an offering of 3,000,000 shares of 8.75%
Series B Cumulative Preferred Stock (liquidation preference of $25
per share). The Series B Preferred Stock may be redeemed at the
liquidation preference at the election of the Company on or after
August 11, 2008. The Series B Preferred Stock has no stated
maturity, sinking fund or mandatory redemption and is not
convertible into any other securities of the Company.

The Company granted the underwriters an overallotment option to
purchase 450,000 additional shares of the Series B Preferred
Stock, which is exercisable within 30 days after closing.

Net proceeds from the issuance were $72.3 million. The Company
will use approximately $68.8 million to redeem the Company's
9-1/2% Series A Cumulative Preferred Stock and the balance to
repay a portion of outstanding borrowings under the Company's line
of credit.

The Series B Preferred Stock will trade on the New York Stock
Exchange under the symbol ENN PrB.

Equity Inns, Inc. is a self-advised REIT that focuses on the
upscale extended stay, all-suite and midscale limited-service
segments of the hotel industry.


EQUITY INNS: Friedman Assists Co. in Completed Preferred Issue
--------------------------------------------------------------
Friedman, Billings, Ramsey Group, Inc. (NYSE: FBR) announced that
its subsidiary, Friedman, Billings, Ramsey & Co., Inc., has closed
a $75 million new preferred share offering for Equity Inns, Inc.
(NYSE: ENN) (S&P, B+ Corporate Credit Rating, Negative) -- a real
estate investment trust focused on the upscale extended stay, all
suite and midscale segments of the hospitality industry.

The transaction involved the offering of 3.0 million 8.75% Series
B Preferred shares priced at $25.00 per share.

Equity Inns has granted the underwriters an option to purchase up
to 450,000 additional shares of preferred stock to cover over-
allotments, if any. The total net proceeds to Equity Inns from the
offering will be approximately $72.3 million, assuming no exercise
of the overallotment option. FBR served as sole book runner and
lead manager for the offering. A.G. Edwards & Sons, Inc., BB&T
Capital Markets and Stifel, Nicolaus & Co., Inc. acted as co-
managers.

The Series B Preferred Stock will trade on the New York Stock
Exchange under the symbol "ENN PrB."

Dividends on the Series B Preferred Stock are cumulative from the
date of the original issue and are payable quarterly commencing on
October 31, 2003 at the rate of 8.75% per annum of the $25
liquidation preference (equivalent to an annual dividend rate of
$2.18 per share).

"We are pleased to have worked with FBR on this capital raise,"
said Phillip H. McNeill, Sr., Chairman and Chief Executive Officer
of Equity Inns, Inc. "Proceeds will permit us to pay the
approximate $68.8 million redemption price of our outstanding 9.5%
Series A Preferred Stock and repay a portion of our roughly $92.7
million borrowings under our line of credit."

"This transaction is another example of an issuer improving its
overall cost of capital by accessing the new issue fixed income
market," said Emanuel Friedman, Co-Chairman and Co- Chief
Executive Officer of FBR. "We are pleased to have assisted Equity
Inns in this matter."

Equity Inns, Inc. is a self-advised REIT that focuses on the
upscale extended stay, all-suite and midscale limited-service
segments of the hotel industry. The company owns 95 hotels with
12,210 rooms located in 34 states. For more information about
Equity Inns, visit the company's Web site at www.equityinns.com.

Friedman, Billings, Ramsey Group, Inc., a national investment
bank, provides investment banking*, institutional brokerage*,
asset management, and private client services through its
operating subsidiaries and invests in mortgage-backed securities
and merchant banking opportunities. FBR focuses capital and
financial expertise on six industry sectors: financial services,
real estate, technology, healthcare, energy and diversified
industries. FBR, headquartered in the Washington, D.C.
metropolitan area, with offices in Arlington, Va. and Bethesda,
Md., also has offices in Atlanta, Boston, Charlotte, Chicago,
Cleveland, Denver, Houston, Irvine, London, New York, Portland,
San Francisco, Seattle, and Vienna. FBR has elected REIT status
for tax purposes. For more information, see http://www.fbr.com


EZENIA! INC: Nasdaq Knocks Shares Off Effective August 12, 2003
---------------------------------------------------------------
Ezenia!(R) Inc. (Nasdaq: EZEN), a leading provider of real-time
collaboration solutions for corporate and government networks and
eBusiness, received word from the Nasdaq Listing Qualifications
Panel, concerning its appeal hearing held on July 10, 2003.

The Panel, consequently, delisted the Company's securities from
The Nasdaq Stock Market effective with the open of business on
Tuesday, August 12, 2003.

The Panel further advised the Company that its securities will be
immediately eligible for quotation on the OTC Bulletin Board,
effective with the open of business on Tuesday, August 12, 2003.
Inclusion on the OTC Bulletin Board was automatic and the OTC
Bulletin Board symbol assigned to the Company was EZEN.

"We are disappointed, but not surprised, with the Panel's
decision," noted Khoa Nguyen, Ezenia! chairman & CEO. "As
indicated in our press release on May 15, 2003, announcing the
delisting notification received from Nasdaq, Ezenia! had not at
the time regained compliance with the minimum $1.00 closing bid
price per share requirement, as set forth in Marketplace Rule
4310(C)(4), nor was it in compliance with Marketplace Rule
4310(C)(2)(B), which in this instance would have required the
Company to have a minimum of $2,500,000 in stockholders equity. As
discussed with the Panel during the hearing, significant progress
had been made since receiving the delisting notification with
respect to both of these Nasdaq requirements where Ezenia! was not
compliant, but a further extension of time was needed in order to
regain full compliance."

In order to regain compliance with Marketplace Rule 4310(C)(2)(B),
requiring the Company to achieve and maintain a minimum
stockholders equity amount of $2.5 million, Ezenia! concluded that
it would have had to consider raising at least $2.0 million
dollars worth of equity in a private placement. "We believe the
market for collaborative software and solutions is nearing the
point of realizing its significant growth opportunities, and that
our InfoWorkSpace(TM) product will be a major beneficiary of this
growth," continued Mr. Nguyen. "In order to maximize the market
opportunity available to InfoWorkSpace, and in turn realize the
greatest long-term value for Ezenia! and its employees, its
existing shareholders and its customers, now would of course be a
good time for us to increase our investment in this opportunity.
In addition to regaining compliance with Nasdaq's minimum
stockholders equity requirement, with an infusion of capital, we
would have considered investing in the development of additional
features and functionality for InfoWorkSpace, the hiring of
additional sales and marketing personnel and the identifying of
seasoned, respected senior executive resources to help guide the
Company through this expected period of strong growth. While
additional time was requested to pursue this initiative, the Panel
was unwilling to grant the Company the further extension of time
requested, or exception to the minimum bid price requirement."

"While disappointed in the Panel's decision, we continue to
believe our most important work is to ensure that Ezenia! strive
for the best possible results for its employees, customers and
shareholders, and this decision does not change that focus."

Also, the Company has announced that it will issue its earnings
release for its second fiscal quarter of 2003 tomorrow.

Ezenia! Inc. (Nasdaq: EZEN), founded in 1991, is a leading
provider of real-time collaboration solutions, bringing new and
valuable levels of interaction and collaboration to corporate
networks and the Internet. By integrating voice, video and data
collaboration, the Company's award-winning products enable groups
to interact through a natural meeting experience regardless of
geographic distance. Ezenia! products allow dispersed groups to
work together in real-time using powerful capabilities such as
instant messaging, whiteboarding, screen sharing and text chat.
The ability to discuss projects, share information and modify
documents allows users to significantly improve team communication
and accelerate the decision-making process. More information about
Ezenia! Inc. and its product offerings can be found at the
Company's Web site at http://www.ezenia.com

At December 31, 2003, the Company's balance sheet shows a total
shareholders' equity deficit of about $1.5 million.


FIBERMARK: S&P Cuts Rating as Weak Demand Hurts Credit Measures
---------------------------------------------------------------
Standard & Poor's Ratings Services lowered its corporate credit
rating on specialty paper manufacturer FiberMark Inc. to 'B' from
'B+'. The current outlook is negative.

FiberMark is based in Brattleboro, Vermont. The company had debt
outstanding at June 30, 2003, of $353 million.

"The rating action reflects deteriorating credit measures caused
by weak North American demand for many of the company's specialty
products, higher energy and pulp costs, product pricing pressures,
manufacturing inefficiencies, and higher capital spending for
capacity expansion in Europe," said Standard & Poor's credit
analyst Pamela Rice. "Although FiberMark's German operations are
performing well and demand is healthy for several of its products,
the U.S. business continues to struggle with low volumes and
operating inefficiencies."

Standard & Poor's said that its ratings on FiberMark reflect the
company's good product and geographic diversity and high
proportion of value-added specialty papers, offset by industry
overcapacity, very aggressive debt leverage, and poor near-term
earnings prospects.


FLEMING: Wins Final Nod to Hire Retail Consulting and Staubach
--------------------------------------------------------------
Fleming Companies, Inc., and its debtor-affiliates obtained the
Court's approval on a final basis to employ Retail Consulting
Services, Inc. and Staubach Retail Services, Ltd., as their real
estate valuation consultants.

Retail Consulting and Staubach Retail will:

    (a) perform leasehold and property valuations for certain of
        the Debtors' assets, each designated as a "Valuation
        Property";

    (b) perform and complete the property valuations contemplated
        by the documents and information provided by the Debtors;
        and

    (c) present a valuation report or reports to the Debtors
        outlining their estimate as to the value of each of the
        Valuation Properties within 60 days after a Valuation
        Property is designated and the Consultants receive the
        required information that is in the Debtors' possession or
        under their control.

For their services, Retail Consulting and Staubach Retail will
receive:

    * $350 for each retail lease valuation; and

    * for each non-retail lease valuation, a fee between $900 to
      $1,250 per valuation.

Retail Consulting and Staubach Retail will also bill the Debtors
for reasonable expenses. (Fleming Bankruptcy News, Issue No. 10;
Bankruptcy Creditors' Service, Inc., 609/392-0900)


FRIEDE GOLDMAN: Court Fixes August 27 Admin. Claims Bar Date
------------------------------------------------------------
By Order of the U.S. Bankruptcy Court for the Southern District of
Mississippi, August 27, 2003, is set as the bar date for filing
requests for payment of administrative expense claims against
Friede Goldman and its debtor-affiliates.  Administative claimants
must file their requests for payment (attaching supporting
documents) with the Clerk of the Bankruptcy Court on or before
5:00 on Aug. 27.  Copies must also be served on:

        1. Counsel for the Debtors
           Douglas G. Walter, Esq.
           Andrews & Kurth LLP
           Suite 420
           600 Travis Street
           Houston, Texas 77002

        2. Counsel for the Official Committee of Unsecured
            Creditors
           Douglas S. Draper, Esq.
           Heller, Draper, Hayden, Patrick & Horn LLC
           650 Poydras Street
           Suite 2500
           New Orleans, Louisiana 70130

The Debtors filed for Chapter 11 relief on April 19, 2001 (Bankr.
S.D. Miss. Case No. 01-52173). Hugh Ray, Esq., John J. Sparacino,
Esq., Douglas G. Walter, Esq., Allison R. Comment, at Andrews &
Kurth LLP and  John G. Corlew, Esq., and J. Fred spencer, Jr.,
Esq. at Watkins & Eager PLLC represent the Debtor in its
restructuring efforts. The Debtors filed their Chapter 11 Plan and
Disclosure Statement with the Bankruptcy Court on June 11, 2003.
The Plan and Disclosure Statement relate to FGH and certain of its
debtor affiliates, and have been jointly proposed by the Debtors
and the Official Unsecured Creditors' Committee.


FRONTLINE COMMS: Fails to Meet AMEX Continued Listing Standards
---------------------------------------------------------------
Frontline Communications Corp. (AMEX: FNT) -- http://www.fcc.net
-- received a notice from the American Stock Exchange staff on
August 4, 2003, indicating that the Company's Series B Convertible
Redeemable Preferred Stock is not in compliance with: Section
1003(b)(iii)(B), the continued listing standards, due to the fact
that the aggregate market value of the shares publicly held has
been less than $1,000,000 for more than 90 consecutive days. The
notice further stated that the Series B Preferred Stock is
therefore subject to being delisted from the Exchange.

This notice is not related to the trading of Frontline's Common
stock.

The Company has appealed this determination and requested a
hearing before a committee of the Exchange. There can be no
assurance that the Company's request for a continued listing will
be granted.

Founded in 1995, Frontline Communications Corp. has two operating
divisions, Provo and Frontline.

The Provo division -- http://www.provo.com.mx-- acquired by
Frontline Communications Corp. in April, 2003, is a Mexican
corporation which maintains a dominant position within the prepaid
calling card and cellular phone airtime markets in Mexico. Provo
and its affiliates have been in operation for over seven years,
and had combined audited revenue in 2002 of approximately $100
million, with operating profits of over $800,000. The company
currently anticipates expanding existing Provo services to the
continental United States, and intends to begin marketing cash
cards, payroll cards and other forms of payroll and money transfer
services, through both the Frontline and Provo divisions, in the
near future.

The Frontline division provides high-quality Internet access and
Web hosting services to homes and businesses nationwide, and
offers Ecommerce, programming, and Web development services
through its PlanetMedia group, www.pnetmedia.com. With the
assistance of its newly acquired Provo division, Frontline plans
on expanding its current services and offerings beyond the
traditional internet sector in the near future. The Frontline
division had revenue of approximately $5 million in 2002.

Frontline Communications' December 31, 2002 balance sheet shows a
working capital deficit of about $2.7 million, and a total
shareholders' equity deficit of about $2 million.


GALEY & LORD: Wants $50MM DIP Financing Extension through Oct. 3
----------------------------------------------------------------
Galey & Lord, Inc., and its debtor-affiliates ask the U.S.
Bankruptcy Court for the Southern District of New York to further
extend their postpetition financing from Wachovia Bank, National
Association.

The extension of the DIP Financing is subject to the existing
terms and conditions of the DIP Financing Agreement and is
modified to mature on October 3, 2003.  The Total Commitment is
$50 million, but at no time will the principal amount of the Loans
and the Letter of Credit Outstandings exceed $25 million.  No
Letter of Credit will be issued if the aggregate Letter of Credit
Outstandings exceeds $10 million.

Upon the repatriation of funds from the Debtors' foreign
subsidiaries, the Debtors will apply 100% of the proceeds to the
Loans and, after the Loans have been prepaid in full, the Debtors
will cash collateralize letters of credit at a rate of 105%.

Additionally, the Debtors promise Wachovia that no less than
$24,400,000 will be repatriated following the Klopman Sale.
Fibre2fashion.com reports that European workwear, protectivewear
and casual apparel fabric manufacturer Klopman International is
being sold to a group of investors led by BS Private Equity.  The
deal, which is expected to be completed within 45 days or so
pending regulatory approvals, will see Klopman move from its
parent company Galey & Lord to a group of European financial
investors that includes MPS Venture and Klopman senior management.
In a statement, Klopman said the landmark sale will provide
increased opportunity to build on its position as Europe's leading
supplier of polyester/cotton blended fabrics.   The new owners
tell Fibre2fashion.com they are fully confident in the existing
management and employees of the company, adding that the company's
structure and management will remain unaltered.

In their sound and prudent business judgment, the Debtors tell the
Court, they've concluded that the DIP Financing Agreement is the
best financing opportunity reasonably available and the extension
of the DIP Financing Agreement is in the best interests of their
estates.  The Debtors point out that the DIP Facility will provide
the Company with sufficient flexibility to operate their
businesses in the ordinary course and it is fair to both the
estates and all creditors.

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


GARDENBURGER INC: June 30 Net Capital Deficit Widens to $52 Mil.
----------------------------------------------------------------
Gardenburger, Inc. (OTC Bulletin Board: GBUR) reported financial
results for the Company's third quarter of fiscal 2003.

Net revenues were $15.0 million for the quarter ended June 30,
2003, compared to $17.1 million for the quarter ended June 30,
2002. The third quarter net loss available for common shareholders
was $856,000, or $0.10 per share. Net income available for common
shareholders for the third quarter of fiscal 2002 was $221,000, or
$0.02 per share, and included income of $108,000 from a legal
settlement.

Gardenburger, Inc.'s June 30, 2003 balance sheet shows a total
shareholders' equity deficit of about $52 million, up from $45
million nine months ago.

"Sales were adversely affected by an unusually wet Spring as we
entered the grilling season," said Scott Wallace, Chairman of the
Board, President and Chief Executive Officer of Gardenburger, Inc.
"Additionally, several major customers reduced inventory levels as
they sought to reduce their warehousing costs in a slow economy.
We are, however, encouraged by the response to our two newest
meatless products, BBQ Chik'n and Meatless Meatloaf."

                      Third Quarter Results

For the third quarter of fiscal year 2003, Gardenburger posted a
gross margin of 44 percent, compared to 45 percent during the
comparative quarter last year. The reduced gross margin is
attributable to a change in the mix of products sold as
Gardenburger continues to launch new meatless alternative
products.

Selling and marketing expense for the third quarter of fiscal 2003
was $3.8 million, compared to $4.0 million for the third quarter
of fiscal year 2002. In fiscal 2002 Gardenburger marketed its
products through magazine advertising as well as consumer coupons
and retail store trade advertisements. In fiscal 2003 the company
eliminated the magazine advertising program and increased its
consumer coupon and trade ad campaign. The change in marketing
program and related timing resulted in the lower selling and
marketing expense for the third quarter of fiscal 2003. General
and administrative costs for the quarter were $1.2 million
compared to $1.0 million for the third quarter of fiscal 2002. The
third quarter fiscal 2003 increase resulted from costs
attributable to development of a long-term business strategy.

Founded in 1985 by GardenChef Paul Wenner(TM), Gardenburger, Inc.
is an innovator in meatless, low-fat food products. The Company
distributes its flagship Gardenburger(R) veggie patty to more than
30,000 food service outlets throughout the United States and
Canada. Retail customers include more than 24,000 grocery, natural
food and club stores. Based in Portland, Ore., the Company
currently employs approximately 175 people.


GE CAPITAL: Fitch Takes Rating Actions on 5 Securitizations
-----------------------------------------------------------
Fitch Ratings has taken rating actions on the following GE Capital
Mortgage Services, mortgage pass-through certificates:

GE Capital Mortgage Services, mortgage pass-through certificate,
series 1999-16

        -- Class A affirmed at 'AAA';
        -- Class M affirmed at 'AAA';
        -- Class B-1 upgraded to 'AAA' from 'AA+';
        -- Class B-2 upgraded to 'AA+' from 'AA-';
        -- Class B-3 affirmed at 'BBB';
        -- Class B-4 affirmed at 'BB'.

GE Capital Mortgage Services, mortgage pass-through certificate,
series 1999-17

        -- Class A affirmed at 'AAA';
        -- Class M affirmed at 'AAA';
        -- Class B-1 upgraded to 'AAA' from 'AA+';
        -- Class B-2 upgraded to 'AAA' from 'AA';
        -- Class B-3 upgraded to 'A+' from 'BBB+';
        -- Class B-4 upgraded to 'BB-' from 'B+'.

GE Capital Mortgage Services, mortgage pass-through certificate,
series 1999-18

        -- Class A affirmed at 'AAA';
        -- Class M affirmed at 'AAA';
        -- Class B-1 upgraded to 'AAA' from 'AA+';
        -- Class B-2 upgraded to 'AAA' from 'AA';
        -- Class B-3 upgraded to 'AA' from 'BBB';
        -- Class B-4 upgraded to 'BBB-' from 'B+'.

GE Capital Mortgage Services, mortgage pass-through certificate,
series 1999-19

        -- Class A affirmed at 'AAA';
        -- Class M affirmed at 'AAA';
        -- Class B-1 upgraded to 'AAA' from 'AA+';
        -- Class B-2 upgraded to 'AA+' from 'A';
        -- Class B-3 affirmed at 'BB+';
        -- Class B-4 affirmed at 'B'.

GE Capital Mortgage Services, mortgage pass-through certificate,
series 1999-21

        -- Class A affirmed at 'AAA'.

These rating actions are being taken as a result of low
delinquencies and losses, as well as increased credit support.


GENERAL MEDIA: Files for Chapter 11 Reorganization in S.D.N.Y.
--------------------------------------------------------------
General Media, Inc., a subsidiary of Penthouse International, Inc.
(OTC Bulletin Board: PHSL) together with eight of its direct and
indirect subsidiaries, filed voluntary petitions for Chapter 11
relief in the United States Bankruptcy Court for the Southern
District of New York. The Company publishes Penthouse magazine and
other publications and is engaged in other diversified media and
entertainment businesses. General Media, Inc. is a 99.5 per cent
owned subsidiary of Penthouse International, Inc., which has not
filed for bankruptcy protection.

The Company also announced that concurrent with the Chapter 11
filing, it has closed a $5 million debtor-in-possession (DIP) line
of credit with a select number of its secured bondholders. The
Company's facilities are operating and its August issue of the
Penthouse magazine is expected to be on the newsstands in the
United States on August 19, 2003. While operating under the
protection of Chapter 11, the Company will seek to restructure its
operations and debt obligations and propose a plan of
reorganization for filing with the court in the near future.

Commenting on this announcement, General Media Chairman and
PENTHOUSE founder, Bob Guccione, said, "This filing provides the
Company with the opportunity to restructure its operations and
finances, leaving it in a stronger position to realize the
significant potential of the brand. Since I founded PENTHOUSE
nearly forty years ago it has evolved into an internationally
recognized premier brand in entertainment for adult audiences. I
believe the additional funding and prompt filing of a plan of
reorganization will present the best means to preserve and enhance
the value inherent in the brand for its many stakeholders."

The Company also announced the appointment of T. Scott Avila as
Chief Restructuring Officer, a newly created position. Mr. Avila,
a Managing Partner of Corporate Revitalization Partners LLC, a
national turnaround consultancy, will oversee the Company's
restructuring efforts, as well as working with the Company to
evaluate strategic options for the Company's continuing
operations. Robert Feinstein, Esquire, a shareholder of Pachulski,
Stang, Ziehl, Young, Jones & Weintraub P.C., is counsel for the
Company.

Penthouse International, Inc. is the parent holding company of
General Media, Inc., a brand-driven global entertainment company
founded in 1965 by Robert C. Guccione. The Company's flagship
PENTHOUSE brand is one of the most recognized consumer brands in
the world and is widely identified with premium entertainment for
adult audiences. PENTHOUSE's trademarks are licensed to third
parties worldwide in exchange for recurring royalty payments.
PENTHOUSE caters to men's interests through various trademarked
publications, movies, the Internet, location-based live
entertainment clubs and consumer product licenses.


GENERAL MEDIA INC: Voluntary Chapter 11 Case Summary
----------------------------------------------------
Lead Debtor: General Media Inc.
             11 Penn Plaza
             12th Floor
             New York, New York 10001

Bankruptcy Case No.: 03-15078

Debtor affiliates filing separate chapter 11 petitions:

        Entity                                       Case No.
        ------                                       --------
        General Media Art Holding, Inc.              03-15080
        General Media Communications, Inc.           03-15083
        General Media Entertainment, Inc.            03-15086
        General Media (UK) Ltd.                      03-15090
        GMCI Internet Operations, Inc.               03-15091
        GMI On-Line Ventures, Ltd.                   03-15093
        Penthouse Images Acquisitions, Ltd.          03-15094
        Pure Entertainment Telecommunications, Inc.  03-15096

Type of Business: The Debtor, a subsidiary of Penthouse
                  International, Inc., publishes Penthouse
                  magazine and other publications and is engaged
                  in other diversified media and entertainment
                  businesses.

Chapter 11 Petition Date: August 12, 2003

Court: Southern District of New York (Manhattan)

Judge: Stuart M. Bernstein

Debtors' Counsel: Robert Joel Feinstein, Esq.
                  Pachulski, Stang, Ziehl, Young, Jones &
                   Weintraub P.C.
                  461 Fifth Avenue
                  25th Floor
                  New York, NY 10017-6234
                  Tel: 212-561-7700
                  Fax: 212-561-7777

Estimated Assets: $50 Million to $100 Million

Estimated Debts: $50 Million to $100 Million


HANOVER COMPRESSOR: Acquires Remaining 49% Interest in Belleli
--------------------------------------------------------------
Hanover Compressor Company (NYSE:HC) (S&P, BB Corporate Credit
Rating, Negative), a leading provider of outsourced natural gas
compression services, has exercised its option to acquire the
remaining 49% interest in Belleli Energy S.r.l. that it did not
already own for approximately $15 million. With this purchase,
Hanover will now own 100% of Belleli.

Belleli is an Italian-based engineering, procurement and
construction company that engineers and manufactures desalination
plants and heavy wall reactors for refineries and processing
plants for use primarily in Europe and the Middle East. Belleli
has three manufacturing facilities, one in Mantova, Italy and two
in the United Arab Emirates (Jebel Ali and Hamriyah). In November
2002, Hanover increased its ownership in Belleli to 51% and began
consolidating the results of Belleli's operations.

"Hanover is excited about taking control of 100% of Belleli" said
Chad Deaton, President and Chief Executive Officer of Hanover.
"This transaction allows us to fully integrate Belleli's
management team and operations into Hanover and provides a solid
base to look to expand our operations in the growing markets of
the Middle East, Europe, Russia, and Central Asia."

Hanover Compressor Company -- http://www.hanover-co.com-- is the
global market leader in full service natural gas compression and a
leading provider of service, financing, fabrication and equipment
for contract natural gas handling applications. Hanover sells and
provides this equipment on a rental, contract compression,
maintenance and acquisition leaseback basis to natural gas
production, processing and transportation companies that are
increasingly seeking outsourcing solutions. Founded in 1990 and a
public company since 1997, Hanover's customers include premier
independent and major producers and distributors throughout the
Western Hemisphere.


IESI CORP: June 30 Balance Sheet Insolvency Widens to $48 Mill.
---------------------------------------------------------------
IESI Corporation reported that revenue for the three months ended
June 30, 2003 increased 16.3% to $60.9 million, as compared with
revenue of $52.4 million for the corresponding three-month period
in 2002. Income from operations for the three months ended
June 30, 2003 was $5.0 million, as compared with $6.1 million for
the corresponding period in 2002. Net income for the three months
ended June 30, 2003 was $101,000, as compared with net income of
$934,000 for the corresponding period in 2002.

Revenue for the six months ended June 30, 2003 increased 17.5% to
$116.3 million, as compared with revenue of $99.0 million for the
corresponding six-month period in 2002. Income from operations for
the six months ended June 30, 2003 was $8.5 million, as compared
with $11.1 million for the corresponding period in 2002. Loss
before cumulative effect of change in accounting principle
(related to the Company's adoption of SFAS No. 143) for the six
months ended June 30, 2003 was $275,000, as compared with net
income of $1.0 million for the corresponding period in 2002.
Effective January 1, 2003, the Company adopted Statement of
Financial Accounting Standards No. 143, "Accounting for Asset
Retirement Obligations." SFAS No. 143 required the Company to
change its method of accounting for landfill capping, closure and
post-closure costs.

The Company also announced that, since April 2003, it had acquired
nine businesses that generate in excess of $9.0 million in
aggregate annual revenue, consisting of one hauling operation in
St. Louis, Missouri, one hauling operation in Granbury, Texas
(approximately 45 miles southwest of Ft. Worth) which included a
transfer station, a municipal solid waste landfill in Weatherford,
Texas (approximately 30 miles west of Ft. Worth), and six tuck-in
acquisitions; two in each of Arkansas, Missouri, and Texas.

At June 30, 2003, the Company's balance sheet shows a total
shareholders' equity deficit of about $48 million.

"The second half of 2003 is shaping up to be very exciting for our
Company," said Mickey Flood, President and Chief Executive Officer
of the Company. "For the past four quarters, we have experienced
pressure on our operating income and margin from several aspects
of our cost structure, including harsh weather conditions, fuel
cost increases, insurance cost increases and the increased cost
associated with our adoption of a new accounting standard, and we
have written off certain project and transaction costs and endured
a poor economy. Additionally, we have offset a large tax increase
at our Pennsylvania landfills with price increases which lowered
our margin by approximately 1%. In the second quarter of this
year, we received an expansion permit for our Bethlehem landfill
which included an increase in the permitted daily volume. In July,
we purchased the City of Weatherford, Texas' MSW landfill near Ft.
Worth. Today, we received our final permit to operate and open a
new greenfield landfill near St. Louis, Missouri and in the next
month we expect to open another new greenfield landfill in central
Louisiana. I'm pleased with our results so far this year despite
these challenges, and with the issuance of the Bethlehem landfill
expansion permit in April and the new landfills, we are well
positioned to finish this year on a very positive note."

The Company is one of the leading regional, non-hazardous solid
waste management companies in the United States. The Company
provides collection, transfer, disposal and recycling services to
264 communities, including more than 510,000 residential and
51,000 commercial and industrial customers, in nine states.


IMMTECH INT'L: Commences Trading on AMEX Effective August 11
------------------------------------------------------------
Immtech International, Inc., (Amex: IMM) announced that its common
stock has been approved for listing on the American Stock
Exchange. Trading is expected to commence at market opening on
August 11, 2003, under the symbol "IMM".

Immtech is expected to have Bear Wagner Specialists LLC as the
specialist firm responsible for trading the Company's common stock
on the AMEX.  The last trading day for Immtech's common stock on
the NASD OTCBB was August 8, 2003.

"With our move to the AMEX, we look forward to increased
visibility, access to an even larger institutional shareholder
base and greater liquidity," stated T. Stephen Thompson, Immtech's
President and Chief Executive Officer. "The move to AMEX will not
result in any interruption in the trading in our stock as the
transition should be seamless for our shareholders.  We look
forward to developing a great relationship with AMEX."

Immtech International, Inc. is a pharmaceutical company focused on
the commercialization of oral treatments for infectious diseases
such as pneumonia, fungal infections, malaria, tuberculosis,
diabetes, hepatitis and tropical diseases such as African sleeping
sickness and Leishmania.  The Company has worldwide, exclusive
rights to commercialize a dicationic pharmaceutical platform from
which a pipeline of products may be developed targeting large,
global markets.  For further information, visit Immtech's Web site
at http://www.immtech.biz

                           *   *   *

As previously reported, since inception, the Company has incurred
accumulated losses of approximately $41,466,000. Management
expects the Company to continue to incur significant losses during
the next several years as the Company continues its research and
development activities and clinical trial efforts.  There can be
no assurance that the Company's continued research will lead to
the development of commercially viable products.  Immtech's
operations to date have consumed substantial amounts of cash.  The
negative cash flow from operations is expected to continue in the
foreseeable future. The Company will require substantial funds to
conduct research and development, laboratory and clinical testing
and to manufacture (or have manufactured) and market (or have
marketed) its product candidates.

Immtech's working capital is not sufficient to fund the Company's
operations through the commercialization of one or more products
yielding sufficient revenues to support the Company's operations;
therefore, the Company will need to raise additional funds. The
Company believes its existing unrestricted cash and cash
equivalents and the grants the Company has received or has been
awarded and is awaiting disbursement of, will be sufficient to
meet the Company's planned expenditures through July 2003,
although there can be no assurance the Company will not require
additional funds. These factors, among others, indicate that the
Company may be unable to continue as a going concern.

The Company's ability to continue as a going concern is dependent
upon its ability to generate sufficient funds to meet its
obligations as they become due and, ultimately, to obtain
profitable operations. Management's plans for the forthcoming
year, in addition to normal operations, include continuing their
efforts to obtain additional equity and/or debt financing, obtain
additional grants and enter into various research, development and
commercialization agreements with other entities.


INTEGRATED HEALTH: Court Approves Stipulation with BT Products
--------------------------------------------------------------
Integrated Health Services, Inc., and its debtor-affiliates
obtained the Court's approval of their stipulation with BT Office
Products International now known as Corporate Express Office
Products, Inc., settling their adversary proceeding.

                         Backgrounder

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

Pursuant to the Stipulation and in settlement of the Adversary
Proceeding, BT Office Products will pay the Debtors $14,577.  The
parties will exchange mutual releases.  BT Office Products has
also agreed to withdraw its claim for $1,071,135.70.  In addition,
the Adversary Proceeding will be dismissed. (Integrated Health
Bankruptcy News, Issue No. 62; Bankruptcy Creditors' Service,
Inc., 609/392-0900)


INTERCEPT INC: June 30 Working Capital Deficit Widens to $40MM
--------------------------------------------------------------
InterCept, Inc. (Nasdaq: ICPT), a leading provider of technology
products and services for financial institutions and merchants,
reported financial results for the three and six months ended
June 30, 2003.

                         Financial Results

Total revenues for the three months ended June 30, 2003 totaled
$64.1 million, a 16.3% increase compared with $55.1 million for
the three months ended June 30, 2002. Net income per common share,
excluding $3.8 million of non-recurring items related to SLMsoft
Inc., as explained below, totaled $3.0 million or $0.15 per share
(diluted), on 20.3 million average shares outstanding for the
three months ended June 30, 2003, versus net income per common
share, excluding unusual items totaling $0.4 million, of $5.1
million or $0.27 per share (diluted), on 19.0 million shares
outstanding for the three months ended June 30, 2002. On a GAAP
basis, net income per common share including these unusual charges
was $600,000 or $0.03 per share (diluted) for the three months
ended June 30, 2003 versus net income of $4.8 million or $0.25 per
share (diluted) for the three months ended June 30, 2002. A
reconciliation of net income excluding the SLM item and GAAP net
income is included in the financial data accompanying this press
release.

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

John Collins, InterCept Chairman and CEO commented, "We were
pleased with our financial results during the second quarter. We
continue to see strong acceptance from our customers of our end-
to-end solution for their technology needs."

"I am happy to report two significant positive events for our
company that occurred since the end of the quarter. On July 25,
2003, InterCept began the first phase of the conversion of
Sovereign Bank's item processing and on August 11, 2003, we
completed the conversion of the New England region's 255 community
banking offices. I am also pleased to announce the signing of a
commitment letter for a $50.0 million credit facility with Bank of
America. These two events are very positive steps in our continued
growth as a company and will allow us to better serve our
customers' needs."

               Second Quarter 2003 Financial Detail

Income Statement Review

Total revenues grew to $64.1 million for the three months ended
June 30, 2003 from $55.1 million for the three months ended
June 30, 2002. Of the $64.1 million, 92% was recurring in nature.
Total revenues from Financial Institution Services grew to $48.6
million from $40.7 million in the second quarter of 2002 and $47.8
million in the first quarter of 2003, and customer reimbursements
included in this total grew to $3.7 million in the second quarter
of 2003 from $2.5 million in the second quarter of 2002 and $4.3
million in the first quarter of 2003. Total revenues from Merchant
Services grew to $15.5 million from $14.4 million in the second
quarter of 2002, but decreased from $17.4 million for the first
quarter of 2003. Revenue from Financial Institution Services
increased due to the acquisition of item processing centers in
July 2002 and internal growth. Revenue from Merchant Services was
higher in the second quarter of 2003 than in the second quarter of
2002 as a result of the acquisitions of iBill in April 2002 and
EPX in May 2002, offset by customer attrition in the merchant
base.

Net Income per common share excluding the unusual non-recurring
items totaled $3.0 million or $0.15 per share in the second
quarter of 2003 from a total of $5.1 million, or $0.27 per share
during the second quarter of 2002. On a GAAP basis, net income
available to common shareholders including these losses was
$600,000 or $0.03 per share (diluted) for the three months ended
June 30, 2003 versus net income of $4.8 million or $0.25 per share
(diluted) for the three months ended June 30, 2002.

Gross margins totaled approximately 49.4% for the second quarter
of 2003 as compared to 53.3% for the second quarter of 2002 and
49.1% for the first quarter of 2003. Gross margins decreased from
the second quarter of 2002 because of the inclusion of additional
revenue from the company's acquisition in July 2002 of item
processing centers as well as additional equipment and
installation revenues. These revenue sources carry lower gross
margins.

Selling, general and administrative expenses as a percentage of
total revenues totaled 35.5% as compared to 33.3% for the second
quarter of 2002 and 35.8% for the first quarter of 2003.

InterCept continues to pursue MCI and its billing agent for monies
related to the Company's Web 900 offering. During the second
quarter of 2003, InterCept received approximately $400,000, net of
amounts reimbursed to customers, related to monies that MCI
collected but did not remit upon their filing for bankruptcy
during June 2002. These amounts are included as a reduction in
cost of services in the accompanying financial statements.

Upon the sale of the assets of Netzee, Inc. in December 2002, a
portion of the purchase price was placed into escrow pending the
resolution of certain matters. In June 2003, InterCept was
notified that it would receive approximately $400,000 from escrow,
which was classified in other (expense) income, net in the
accompanying financial statements. InterCept received the $400,000
during July 2003.

The effective tax rate for the second quarter of 2003 was 40.4% as
compared to 37.0% for the second quarter of 2002. The increase in
the effective rate is mainly due to increased profits in states
with higher tax rates and permanent non-deductible items.

Balance Sheet Review

InterCept's outstanding indebtedness on its line of credit as of
June 30, 2003 was $31.3 million. As previously noted, InterCept
entered into a commitment letter for a $50.0 million three-year
credit facility with Bank of America, N.A. InterCept anticipates
closing this facility by September 30, 2003.

The amount outstanding on InterCept's CD-secured note was $17.0
million at June 30, 2003. This note is secured by cash investments
of $18.0 million.

Capital expenditures for the six months ended June 30, 2003 were
$11.7 million. In August 2003, InterCept signed leasing agreements
to finance $5.2 million that upon receipt will further reduce
InterCept's borrowings under its line of credit.

Client payouts decreased to $42.5 million as of June 30, 2003
compared to $58.7 million as of December 31, 2002. This decrease
is due to lower transaction volume and customer attrition in the
Merchant Services division.

SLMsoft Inc.

On December 3, 2001, InterCept entered into a loan agreement with
SLMsoft Inc. and its subsidiary. Under the loan agreement,
InterCept loaned SLM $7.0 million in exchange for cash and
settlement of indemnification obligations that SLM owed to
InterCept. The loan was secured by the pledge of shares of
InterCept stock. During the second quarter of 2003, both SLM
entities became the subject of bankruptcy proceedings. The loan
matured on June 30, 2003, has not been repaid, and is secured by
371,636 shares of InterCept common stock. As of June 30, 2003,
InterCept took a $3.5 million charge against the loan, leaving a
balance of $3.7 million on the balance sheet. InterCept also
incurred a $250,000 charge related to other obligations SLM owes
to InterCept.

Credit Facility

InterCept's principal credit facility is presently with Wachovia
Bank. The $3.8 million in charges related to SLM described above
caused InterCept not to comply with a financial covenant in the
Wachovia facility. Wachovia has waived this non-compliance until
September 30, 2003. InterCept has accepted a commitment letter
from Bank of America, N.A. for a new $50 million credit facility,
which would provide sufficient borrowing capacity to repay
Wachovia in full and provide additional working capital to
InterCept.

Sovereign Bank

InterCept began transitioning Sovereign Bank's item and check
processing services on July 25, 2003 and have completed the
transition of all 255 of Sovereign's community banking offices
located in the New England area. InterCept anticipates completing
the conversion of the remaining Sovereign community banking
offices to InterCept's check image processing services by year-
end.

Effect of Recent Settlement by MasterCard and Visa of Class Action

As recently reported, MasterCard and Visa have settled the class
action lawsuit brought by Wal-Mart and others regarding debit card
transactions. While there is still uncertainty on how the
settlement will affect debit card volumes and merchants who choose
to accept or deny debit cards, InterCept believes that the changes
in interchange could affect its financial results. Based on
current activity levels InterCept estimates that the changes as
presently reported will reduce its earnings by approximately
$50,000 per month.

          Additional Information Regarding 2003 Earnings

As previously discussed, InterCept has completed the first stage
of the Sovereign conversion. While this conversion has been
successfully completed, the conversion did not happen as quickly
as InterCept had anticipated. As a result InterCept will not
achieve the revenue and profit levels related to Sovereign during
2003 that InterCept originally estimated. InterCept will incur
additional costs directly related to the new credit facility and
the retirement of the existing credit facility. The combination of
these two items along with the reduction in debit card earnings
will result in an estimated reduction of net income of $1.8
million for 2003, the majority of which will not be related to
InterCept's recurring operations.

InterCept, Inc., is a single-source provider of a broad range of
technologies, products and services that work together to meet the
technology and operating needs of financial institutions and
merchants. InterCept's products and services include core data
processing, check processing and imaging, electronic funds
transfer, debit and credit card processing, data communications
management, and related products and services. For more
information about InterCept, go to http://www.intercept.net


INT'L MULTIFOODS: Completes $250-Million Refinancing Transaction
----------------------------------------------------------------
International Multifoods Corp. (NYSE:IMC) has entered into a new
$250 million senior secured credit agreement that allows the
company to refinance some of its current debt under more favorable
terms.

The new five-year agreement includes a $175 million revolving line
of credit and a $75 million amortizing term loan. The new
financing replaces the remaining balance on the company's $450
million senior secured credit agreement that was obtained in
connection with Multifoods' November 2001 acquisition of the
Pillsbury desserts and specialty products business from General
Mills.

Since completing the acquisition, the company has used the
proceeds from the sale of its foodservice distribution business
and strong operating cash flows to substantially reduce its debt.
Including $200 million of senior unsecured notes that are
guaranteed by Diageo plc and mature in November 2009, total debt
at the end of the company's fiscal 2004 first quarter in May was
$375.9 million, down from nearly $600 million in November 2001.

The interest rate under the new credit agreement will be
approximately 75 basis points lower than the rate under the
previous credit facility. The reduced interest rate, along with
lower amortization of set-up fees from the new credit agreement,
will result in interest expense savings of approximately $2
million, or 7 cents per share, over the next 12 months.

"This new financing arrangement will provide us with greater
financial flexibility and will lower our interest costs," said
Gary E. Costley, Multifoods chairman and chief executive officer.

As a result of the debt refinancing, Multifoods will recognize a
non-cash pre-tax charge of approximately $4.5 million, or 14 cents
per share, in the second quarter ending Aug. 30 to write off the
unamortized portion of fees related to the company's previous
credit facility.

For its fiscal year ending Feb. 28, 2004, the company continues to
expect earnings per share before unusual items in the range of
$1.70 to $1.75. Including the 14-cents-per-share write-off related
to the debt refinancing and unusual items of 15 cents to 18 cents
per share associated with the first-quarter restructuring in the
company's Canadian Foods and Foodservice Products businesses and
the previously announced sale of the foodservice pie business,
reported earnings are expected to be in the range of $1.38 to
$1.46 per share.

As a result of continued softness in the company's foodservice
products businesses in the United States and Canada, the company
now expects second-quarter earnings before unusual items in the
range of 20 cents to 23 cents per share. Including unusual items,
reported results in the second quarter are expected to be break
even to 6 cents per share.

"Our consumer businesses are performing well, and we are
benefiting from solid demand for our brands in the marketplace,"
Costley said. "We expect the combination of strong performance in
our consumer businesses and the interest expense savings
associated with our debt refinancing to offset the shortfall in
our foodservice businesses this year."

U.S. Bank National Association served as the lead agent for the
new credit agreement.

International Multifoods is a manufacturer and marketer of branded
consumer foods and foodservice products in North America. The
company's food manufacturing businesses have combined annual net
sales of nearly $940 million. Multifoods' brands include
Pillsbury(R) baking mixes for items such as cakes, muffins,
brownies and quick breads; Pillsbury(R) ready-to-spread frostings;
Hungry Jack(R) pancake mixes, syrup and potato side dishes; Martha
White(R) baking mixes and ingredients; Robin Hood(R) flour and
baking mixes; Pet(R) evaporated milk and dry creamer; Farmhouse(R)
rice and pasta side dishes; Bick's(R) pickles and condiments in
Canada; Softasilk(R) premium cake flour; Red River(R) hot flax
cereal; and Golden Temple(R). Further information about Multifoods
is available on the Internet at http://www.multifoods.com

                        *   *   *

As previously reported in Troubled Company Reporter, Standard &
Poor affirmed its double-'B' corporate credit rating as well as
its double-'B'-plus senior secured debt rating on International
Multifoods Corp. The ratings were removed from CreditWatch, where
they were placed on July 30, 2002. At the same time, the company's
single-'A'-plus senior unsecured debt rating was affirmed. The
rating was not on CreditWatch, and the senior unsecured debt issue
is unconditionally guaranteed by Diageo PLC.

The outlook is stable.


IRVINE SENSORS: June 29 Working Capital Deficit Narrows to $210K
----------------------------------------------------------------
Irvine Sensors Corporation (Nasdaq: IRSN; Boston Stock Exchange:
ISC) reported operating results for the firm's third fiscal
quarter and 39 weeks ended June 29, 2003.

For the third quarter of fiscal 2003, the 13 weeks ended June 29,
2003, total revenues were $2,396,700, down from $3,940,500 for the
13 weeks ended June 30, 2002. However, total revenues through the
first 39 weeks of fiscal 2003 were $10,081,200, up from $8,739,100
in the comparable 39-week period of fiscal 2002. Net losses for
both the 13-week and 39-week periods in the current fiscal year
were reduced from net losses in the comparable fiscal 2002
periods. Net loss for the 13-week period ended June 29, 2003 was
$1,660,000 versus $1,724,200 for the 13-week period ended June 30,
2002. The net loss through the first 39 weeks of the current
fiscal year was $4,381,400, down from $5,399,900 in the first
three quarters of fiscal 2002.

At June 29, 2003, the Company's balance sheet shows that its total
current liabilities eclipsed its total current assets by about
$210,000.

Irvine Sensors Corporation, headquartered in Costa Mesa,
California, is primarily engaged in the sale of stacked chip
assemblies and research and development related to high density
electronics, miniaturized sensors and cameras, optical
interconnection technology, high speed routers, image processing
and low-power analog and mixed-signal integrated circuits for
diverse systems applications.

                         *     *     *

                   Going Concern Uncertainty

In its SEC Form 10-Q, Irvine Sensors reported:

"The [Company's] consolidated financial statements have been
prepared on a going concern basis, which contemplates the
realization of assets and settlement of obligations in the normal
course of business.

"The Company generated net losses of $6,037,500 and $4,381,400 in
fiscal 2002 and the first 39 weeks of the fiscal year ending
September 28, 2003, respectively. In addition, the Company had
total stockholders' equity of $4,597,200 and a working capital
deficit of $211,300 at June 29, 2003.

"As mitigation to possible going concern risks posed by this
operating performance and financial condition, the Company has
historically relied on equity financing to fund deficits in its
operations and has continued to demonstrate its access to equity
capital during fiscal 2003, including approximately $2 million in
private placements of equity financing secured in the 13-week
period ended June 29, 2003.

"Management believes, but cannot assure, that the Company will be
able to raise additional working capital, if required to fund its
operations for at least the next twelve months.

"Furthermore, the Company received several new government contract
awards in March and April 2003 that management believes, but
cannot guarantee, will contribute to improvements in the Company's
operating results during the fourth quarter of fiscal 2003.  In
addition, expenses in subsidiaries, which has historically been a
significant source of consolidated net operating losses in prior
periods, have been sharply curtailed, and the Company has
reorganized its operations to consolidate technical and
administrative support resources throughout the Company, including
subsidiaries, thereby further reducing total expenses."


IRVINE SENSORS: Holding Third Quarter Conference Call Today
-----------------------------------------------------------
Irvine Sensors Corporation (Nasdaq: IRSN; Boston Exchange: ISC)
will host a conference call to discuss results of its third fiscal
quarter and 39-week period ended June 29, 2003, on Wednesday,
August 13 at 1:15 PM Pacific Daylight Time.

Irvine Sensors' CEO Robert G. Richards and CFO John Stuart will
host the Company's call to discuss those results.  The conference
call will be broadcast live over the Internet and can be accessed
by all interested parties via a link on Irvine Sensors' homepage
at http://www.irvine-sensors.com  To listen to the live call,
please go to the Irvine Sensors Web site at least fifteen minutes
prior to the start of the call to register, download, and install
any necessary audio software.  For those unable to monitor the
live broadcast, a replay will be available shortly after the
conclusion of the call, and remain archived on the Irvine Sensors
site through Monday, August 18, 2003.

Irvine Sensors Corporation, headquartered in Costa Mesa,
California, is primarily engaged in the sale of stacked chip
assemblies and research and development related to high density
electronics, miniaturized sensors and cameras, optical
interconnection technology, high speed routers, image processing
and low-power analog and mixed-signal integrated circuits for
diverse systems applications.

                         *     *     *

                   Going Concern Uncertainty

In its SEC Form 10-Q, Irvine Sensors reported:

"The [Company's] consolidated financial statements have been
prepared on a going concern basis, which contemplates the
realization of assets and settlement of obligations in the normal
course of business.

"The Company generated net losses of $6,037,500 and $4,381,400 in
fiscal 2002 and the first 39 weeks of the fiscal year ending
September 28, 2003, respectively. In addition, the Company had
total stockholders' equity of $4,597,200 and a working capital
deficit of $211,300 at June 29, 2003.

"As mitigation to possible going concern risks posed by this
operating performance and financial condition, the Company has
historically relied on equity financing to fund deficits in its
operations and has continued to demonstrate its access to equity
capital during fiscal 2003, including approximately $2 million in
private placements of equity financing secured in the 13-week
period ended June 29, 2003.

"Management believes, but cannot assure, that the Company will be
able to raise additional working capital, if required to fund its
operations for at least the next twelve months.

"Furthermore, the Company received several new government contract
awards in March and April 2003 that management believes, but
cannot guarantee, will contribute to improvements in the Company's
operating results during the fourth quarter of fiscal 2003.  In
addition, expenses in subsidiaries, which has historically been a
significant source of consolidated net operating losses in prior
periods, have been sharply curtailed, and the Company has
reorganized its operations to consolidate technical and
administrative support resources throughout the Company, including
subsidiaries, thereby further reducing total expenses."


JAMES CABLE: Disclosure Statement Hearing Set for August 18
-----------------------------------------------------------
On June 26, 2003, James Cable Partners, LP and its debtor-
affiliate filed their Proposed Plan of Reorganization together
with an accompanying Disclosure Statement in the U.S. Bankruptcy
Court for the Middle District of Georgia.

A hearing to consider the adequacy of the Debtors' Disclosure
Statement, within the meaning of Sec. 1125 of the Bankruptcy Code,
is set for August 18, 2003, at 3:30 p.m., before the Honorable
Robert F. Hershner, Jr.  The Court will consider whether the
Disclosure Statement contains the right kind and amount of
information that creditors will need to decide whether to vote
to accept or reject the Plan.

The Debtors filed for Chapter 11 protection on June 26, 2003,
(Bankr. M.D. Ga. Case No. 03-52842). Frank B. Wilensky, Esq., at
Macey, Wilensky, Cohen, Wittner & Kessler, LLP represents the
Debtors in their restructuring efforts.  James Cable is based in
Bloomfield Hills, Michigan and owns, operates and develops cable
television systems serving rural communities.  In its quarterly
filing for the quarter ended March 31, 2003, James Cable reports
$45.4 million in assets and liabilities of $130.2 million.


JP MORGAN: Fitch Assigns Low-B Ratings to Six Notes Classes
-----------------------------------------------------------
J.P. Morgan Chase Commercial Mortgage Securities Corp., series
2003-CIBC6, commercial mortgage pass-through certificates are
rated by Fitch Ratings as follows:

        -- $216,200,000 class A-1 'AAA';
        -- $653,188,000 class A-2 'AAA';
        -- $31,189,000 class B 'AA';
        -- $32,488,000 class C 'A';
        -- $11,696,000 class D 'A-';
        -- $1,039,627,617 class X-1'AAA';
        -- $998,814,000 class X-2'AAA';
        -- $14,295,000 class E 'BBB+';
        -- $10,396,000 class F 'BBB';
        -- $12,996,000 class G 'BBB-';
        -- $15,594,000 class H 'BB+';
        -- $5,198,000 class J 'BB';
        -- $7,797,000 class K 'BB-';
        -- $5,198,000 class L 'B+';
        -- $3,899,000 class M 'B';
        -- $1,300,000 class N 'B-';
        -- $18,193,617 class NR 'NR'.

Classes A-1, A-2, B, C and D are offered publicly, while classes
X-1, X-2, E, F, G, H, J, K, L, M, N and NR are privately placed,
pursuant to rule 144A of the Securities Act of 1933. The
certificates represent beneficial ownership interest in the trust,
primary assets of which are 127 fixed-rate loans having an
aggregate principal balance of approximately $1,039,627,617, as of
the cutoff date.


KINETIC CONCEPTS: Completes Key Aspects of Recapitalization
-----------------------------------------------------------
Kinetic Concepts Inc., (S&P, B+ Corporate Credit Rating, Stable)
has completed key aspects of a recapitalization transaction,
including: (1) issuance and sale of $205 million of its Series A
7.375% Senior Subordinated Notes Due 2013 pursuant to Rule 144A
and Regulation S; (2) entering into a new senior credit facility
consisting of a $480 million term loan being funded at closing and
an undrawn $100 million revolving credit facility; and (3)
issuance and sale of $263,794,000 of Series A Convertible
Preferred Stock in a private placement.

Proceeds from the new debt and stock issuances have been or will
be used to complete (1) repayment of $209,066,617 under, and the
termination of, KCI's existing senior credit facility; (2) mailing
a notice of redemption of all of KCI's 9.625% Senior Subordinated
Notes Due 2007; and (3) commencing a tender offer to purchase for
cash up to $589,763,000 of KCI's outstanding common stock and
vested stock options at a purchase price of $17 per share.
KCI also intends to repurchase additional shares of its common
stock and vested stock options prior to March 31, 2004, in an
aggregate amount equal to the sum of (i) the net after-tax
proceeds of the $75.0 million antitrust settlement in connection
with KCI's antitrust lawsuit against Hillenbrand Industries Inc.
and Hill-Rom Company Inc., a wholly owned subsidiary of
Hillenbrand that KCI expects to receive in January 2004, (ii) the
estimated tax benefits to KCI related to the refinancing
transactions in an amount not to exceed $40.0 million and (iii)
the cash received from the exercise, if any, of employee stock
options in connection with the tender offers.

The New Notes are obligations of KCI, ranking subordinate in right
of payment to all its senior debt. Neither the New Notes nor the
Preferred Stock have been registered under the Securities Act of
1933, as amended (the "Act") and they may not be offered or sold
in the United States absent registration or an applicable
exemption from the registration requirements of the Act.

Borrowings under the New Senior Credit Facility are secured by a
first priority security interest in substantially all of the
capital stock or membership interests of all of KCI's subsidiaries
that are guarantors under the New Senior Credit Facility and 65%
of the capital stock or membership interests of certain of KCI's
foreign subsidiaries.

The Preferred Stock is entitled to quarterly dividends, payable
in-kind or in cash, subject to certain restrictions under the New
Senior Credit Facility, at a rate of 9%, is convertible into
common stock at the holder's option at a conversion price of
$17.00 per common share and is entitled to vote together with the
common stock. The Preferred Stock will be mandatorily convertible
if KCI completes an initial public offering of common stock at a
price of $22.00 per share or greater. The Preferred Stock is also
subject to an investors' rights agreement which sets forth the
terms of the registration rights, right of first offer, "tag-
along" rights and "bring-along" rights.

Kinetic Concepts Inc. is a global medical device company with
leadership positions in (i) advanced wound care and (ii)
therapeutic surfaces that treat and prevent complications
resulting from patient immobility. The Company designs,
manufactures, markets and services a wide range of proprietary
products that can significantly improve clinical outcomes while
reducing the overall costs of patient care by accelerating the
healing process or preventing complications. The Company has an
infrastructure designed to meet the specific needs of medical
professionals and patients across all health care settings
including acute care hospitals, extended care facilities and
patients' homes.


LAIDLAW: Enters Stipulation Allowing Citibank Canada Swap Claims
----------------------------------------------------------------
On October 15, 2001, Citibank Canada filed Proof of Claim No. 436
for $65,808,596 against Laidlaw Inc., and debtor-affiliates based
on obligations arising under an ISDA Master Agreement and certain
related swap transactions between the Debtors and Citibank.  On
March 17, 2003, Citibank filed Proofs of Claim Nos. 965 and 966,
each for $69,922,640, amending Claim No. 436.  Of the $69,922,640,
$4,114,045 was for prepetition interest on the ISDA Master
Agreement and other swap transactions.  Proofs of Claim Nos. 965
and 966 also asserted other unliquidated contingent amounts.

Consequently, the Debtors and Citibank agree to fix the allowed
amount of the Claims through a stipulation wherein:

   (a) Claim No. 966 will be allowed for $69,922,640 in full
       satisfaction of any and all claims that Citibank may have
       against the Debtors relating to the ISDA Master Agreement
       and other swap transactions, otherwise asserted in the
       Claims;

   (b) Claim No. 966 will be satisfied in accordance with the
       treatment provided to General Unsecured Claims in Class
       under the Plan; and

   (c) Claim No. 436 will be deemed amended and superseded by
       Claim No. 966.  Claim No. 965 will be deemed duplicative
       of Claim No. 966.  Finally, Claim No. 436 and Claim No.
       965 will be deemed withdrawn and dismissed against the
       Debtors. (Laidlaw Bankruptcy News, Issue No. 39; Bankruptcy
       Creditors' Service, Inc., 609/392-0900)


LEAP WIRELESS: Solicits Competing Bids for Spectrum in Idaho
------------------------------------------------------------
Leap Wireless International, Inc. (OTC Bulletin Board: LWINQ), an
innovator of wireless communications services, announced that the
U.S. Bankruptcy Court for the Southern District of California in
San Diego, California has approved a Bidding Procedures Motion to
authorize the sale of 15 MHz of spectrum in each of the Idaho
Falls and Twin Falls, Idaho markets.

As part of its ongoing efforts to maximize value through the sale
of excess spectrum, Leap's subsidiary which owns these licenses,
Cricket Licensee (Reauction), Inc., had previously entered into a
license acquisition agreement with Edge Acquisitions, LLC. The
Idaho Falls and Twin Falls licenses were acquired by the Debtor in
September 1999 for approximately $84,000 and $49,000 respectively,
and are presently carried on the Debtor's books at those same
values.

As required by applicable bankruptcy laws, competing bids will be
solicited on the licenses and submissions must be received no
later than 4:00 p.m. (PST) on Wednesday, September 3, 2003. The
current sale price is $3,250,000 and the Bidding Procedures
require that any competing bids overbid this amount in increments
of $25,000. Competing bids must be all cash, not conditioned upon
Federal Communication Commission approval of the sale, and must be
on terms and conditions at least as favorable as agreed upon with
Edge. Full details of the bidding procedures are contained in the
Bidding Procedures Motion which, along with the Edge agreement,
can be found in the "Restructuring Overview/Legal Documents"
section of the Company's web site, www.leapwireless.com . The
proceeds from the sale will remain subject to a security interest
in favor of the holders of senior secured vendor debt issued by
Cricket Communications, Inc.

Leap, headquartered in San Diego, Calif., is a customer-focused
company providing innovative communications services for the mass
market. Leap pioneered the Cricket Comfortable Wirelessr service
that lets customers make all of their local calls from within
their local calling area and receive calls from anywhere for one
low, flat rate. For more information, visit
http://www.leapwireless.com


LEAP WIRELESS: Court Okays PricewaterhouseCoopers as Accountants
----------------------------------------------------------------
Leap Wireless International Inc., and its debtor-affiliates
obtained the Court's permission to employ PricewaterhouseCoopers
LLP as independent public accountants.

PwC will provide accounting, auditing and tax services as deemed
appropriate and feasible in order to advise the Debtors in the
course of these Chapter 11 cases, including:

    A. Accounting and Auditing:

       -- audits of the Debtors' financial statements as may be
          required from time to time, and advice and assistance
          in the preparation and filing of financial statements
          and disclosure documents required by the Securities and
          Exchange Commission including Forms 10-K and 10-Q as
          required by applicable law or as requested by the
          Debtors;

       -- audits of any benefit plans as may be required by the
          Department of Labor or the Employee Retirement Income
          Security Act, as amended;

       -- review of the Debtors' unaudited quarterly financial
          statements as required by applicable law or as
          requested by the Debtors;

       -- performance of internal controls review and required
          attestation services with respect to compliance with
          Section 404 of the Sarbanes Oxley Act; and

       -- performance of other related accounting services for the
          Debtors as may be necessary or desirable.

    B. Tax:

       -- review of and assistance in the preparation and filing
          of any tax returns;

       -- advice and assistance regarding tax planning issues,
          including calculating net operating loss carry forwards
          and the tax consequences of any proposed plans of
          reorganization, and assistance in the preparation of any
          Internal Revenue Service ruling requests regarding the
          future tax consequences of alternative reorganization
          structures;

       -- assistance regarding existing and future IRS
          examinations; and

       -- any and all other tax assistance as may be requested
          from time to time.

Pursuant to the March 3, 2003 Engagement Letter outlining the
terms of retention, PwC will:

    -- prepare and sign the U.S. Corporation Income Tax Return,
       Form 1120 and required federal forms, for Leap for the tax
       year beginning January 1, 2002 through December 31, 2002;

    -- prepare and sign the required state and local corporate
       income tax returns for tax year beginning January 1, 2002
       through December 31, 2002; and

    -- prepare all required federal and state extension requests
       for 2002 and all required estimated tax payments for 2003.

The Debtors and PwC recently entered into an engagement letter
dated May 15, 2003, pursuant to which PwC will assist the Debtors
in analyzing certain tax aspects of the proposed bankruptcy plan,
including:

    -- determination of a reasonable estimate of the Excess Loss
       Account of each member of the Leap consolidated group;

    -- determination of a reasonable estimate of the Cancellation
       of Debt income at each subsidiary;

    -- determination of a reasonable estimate of the tax
       attributes, stock basis, and inside asset basis of each
       Leap legal entity;

    -- determination of the possible tax attribute reduction and
       asset basis reduction resulting from the COD income;

    -- consideration of the optimal form of tax attribute
       reduction as between separate company basis and
       consolidated basis; and

    -- consideration of whether ELAs may be triggered by the
       proposed restructuring and propose alternatives that might
       have more beneficial tax results.

    Fees for Accounting and Auditing Professional Services:

       National Office Partners                   $800
       Local Office Partners                       500
       Senior Managers/Directors                   385
       Managers                                    300
       Senior Associates                           250
       Associates                                  135
       Administration/Paraprofessionals             60

    Fees for Tax Compliance Professional Services:

       Partners                                   $366
       Senior Managers/Directors                   327
       Managers                                    258
       Senior Associates                           154
       Associates                                  110
       Administration/Paraprofessionals             50

    Fees for Tax Consulting Professional Services:

       National Office Partners                   $674
       National Office Senior Managers             554
       Partners                                    513
       Senior Managers/Directors                   457
       Managers                                    361
       Senior Associates                           216
       Associates                                  153
       Administration/Paraprofessionals             55

The Engagement Letter estimates that fees for services performed
will be $125,000 and any assistance in gathering information,
analyzing data, or formatting and calculating schedules would be
provided at $225 per hour.  The March 3 Engagement Letter further
provides that other additional services may be billed at these
rates:

       Partners                            $510
       Directors                            450
       Senior Managers                      400
       Managers                             360
       Senior Associates                    240

As of June 5, 2003, PwC was paid an $80,000 advance and has
incurred $19,396 in fees.  Therefore, as of June 5, 2003, total
payments received from the Debtors for tax compliance services as
specified in the Engagement Letter exceed actual hours incurred
at the indicated rates by $60,604.

Fees for services provided are consistent with the hourly rates.
Specifically, the hourly rates are:

       National Office Partners            $674
       National Office Senior Managers      554
       Partners                             513
       Senior Managers/Directors            457
       Managers                             361
       Senior Associates                    216
       Associates                           153
       Administration/Paraprofessionals      55
(Leap Wireless Bankruptcy News, Issue No. 8; Bankruptcy Creditors'
Service, Inc., 609/392-0900)


LORAL SPACE: Appoints BSI as Court Claims and Noticing Agent
------------------------------------------------------------
Loral Space & Communications Ltd., and its debtor-affiliates
sought and obtained approval from the U.S. Bankruptcy Court for
the Southern District of New York to appoint Bankruptcy Services,
LLC as claims and noticing agent in their chapter 11 proceedings.

BSI has agreed to:

     a. notify all potential creditors of the filing of the
        chapter 11 petitions and of the setting of the first
        meeting of creditors pursuant to section 341(a) of the
        Bankruptcy Code;

     b. maintain an official copy of the Debtors' schedules of
        assets and liabilities and statements of financial
        affairs, listing the Debtors' known creditors and the
        amounts owed thereto;

     c. furnish a form for the filing of proofs of claim, after
        approval of such notice and form by this Court;

     d. file with the Clerk, within 10 days of service, a copy
        of the proof of claim notice, a list of persons to whom
        it was mailed (in alphabetical order), and the date the
        notice was mailed;

     e. docket all claims received, maintaining the official
        claims registers for each Debtor on behalf of the Clerk,
        and providing the Clerk with certified duplicate
        unofficial Claims Registers on a monthly basis, unless
        otherwise directed;

     f. specify in the applicable Claims Register the following
        information for each claim docketed:

          (i) the claim number assigned,

         (ii) the date received,

        (iii) the name and address of the claimant and agent, if
              applicable, who filed the claim, and

         (iv) the classification of the claim;

     g. relocate, by messenger, all of the actual proofs of
        claim filed with the Court, if necessary to BSI, not
        less than weekly;

     h. record all transfers of claims and providing any notices
        of such transfers required by Rule 3001 of the Federal
        Rules of Bankruptcy Procedure;

     i. make changes in the Claims Registers pursuant to Court
        Order;

     j. upon completion of the docketing process for all claims
        received by the Clerk's office, turn over to the Clerk
        copies of the Claims Registers for the Clerk's review;

     k. maintain the official mailing list for each Debtor of
        all entities that have filed a proof of claim, which
        list shall be available upon request by a party in
        interest or the Clerk;

     l. assist with, among other things, the solicitation and
        the calculation of votes and the distribution as
        required in furtherance of confirmation of plan(s) of
        reorganization; and

     m. 30 days prior to the close of these cases, submit an
        Order dismissing BSI and terminating the services of BSI
        upon completion of its duties and responsibilities and
        upon the closing of these cases.

BSI's professional fees are:

          Kathy Gerber           $210 per hour
          Senior Consultants     $185 per hour
          Programmer             $130 to $160 per hour
          Associate              $135 per hour
          Data Entry/Clerical    $40 to $60 per hour
          Schedules Preparation  $225 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.


MAGNATRAX CORP: Proofs of Claim Due by September 8, 2003
--------------------------------------------------------
The U.S. Bankruptcy Court for the District of Delaware fixes
September 8, 2003, as the deadline for creditors of Magnatrax
Corporation and its debtor-affiliates to file their proofs of
claim or be forever barred from asserting their claims against the
Debtors' estates.

All Proofs of Claim must be received before 4:00 p.m. on Sept. 8,
by the Debtors' Claims Agent, Garden City Group, Inc.  If filed by
mail, proof of claim forms must be sent to:

        Magnatrax Corporation
        PO Box 9000 #6109
        Marrick, New York 11566-9000

and if filed by hand delivery or courier, to:

        The Garden City Group, Inc.
        Attn: MTX Claims Processing
        105 Maxess Road
        Melville, New York 11747

Magnatrax Corporation is a diversified North American manufacturer
and marketer of engineered building products and services for non-
residential and residential construction markets.  The Company
filed for chapter 11 protection on May 12, 2003 (Bankr. Del. Case
No. 03-11402).  Joel A. Waite, Esq., Maureen D. Luke, Esq., at
Young Conaway Stargatt & Taylor and Andrew A. Kress, Esq., Keith
R. Murphy, Esq., at Kaye Scholer LLP represent the Debtors in
their restructuring efforts.  When the Company filed for
protection from its creditors, it listed $207,000,000 in total
assets and $326,000,000 in total debts.


MCDERMOTT INT'L: June 30 Net Capital Deficit Widens to $433 Mil.
----------------------------------------------------------------
McDermott International Inc. (NYSE:MDR) announced a loss from
continuing operations of $60.5 million, or $0.95 loss per diluted
share, for the 2003 second quarter compared to a loss from
continuing operations of $235.4 million, or $3.82 loss per diluted
share, for the 2002 second quarter.

Net loss for the 2003 second quarter of $59.9 million, or $0.94
loss per diluted share, included net income from discontinued
operations of $0.7 million, or $0.01 per diluted share. Net loss
for the 2002 second quarter of $234.2 million, or $3.80 loss per
diluted share, included net income from discontinued operations of
$1.2 million, or $0.02 per diluted share. Weighted average common
shares outstanding were 64.0 million and 61.7 million at June 30,
2003 and June 30, 2002, respectively.

Two significant items impacting the net loss for the 2003 quarter
on an after-tax basis were as follows:

-- $40.0 million loss for the revaluation of the estimated
   settlement costs related to the Chapter 11 proceedings
   involving The Babcock & Wilcox Company

-- $39.9 million loss related to a marine construction project in
   Argentina

Revenues increased 29% to $595.5 million in the 2003 second
quarter compared to the 2002 second quarter. This increase is due
primarily to the increased activity in the Marine Construction
Services segment partially offset by the absence of revenues from
the Power Generation Systems segment in the 2003 second quarter
due to the sale of Babcock & Wilcox Volund ApS in 2002.

Operating loss of $13.9 million for the 2003 second quarter
included a $39.9 million loss related to a project in Argentina
being performed by J. Ray McDermott, which comprises the Marine
Construction Services segment, and an $18 million qualified
pension plan expense in the Corporate segment. The 2002 second
quarter operating loss of $237.3 million included a $224.7 million
write-off of the investment in B&W in the Corporate segment and a
$33.9 million loss from the EPIC Spar projects in the Marine
Construction Services segment.

"I am pleased with BWX Technologies Inc.'s ability to consistently
deliver year-over-year improved operational performance and
financial results in our Government Operations segment.
Unfortunately, the Company's second quarter was adversely impacted
by a weather-related event which caused a three-month delay in
work on a project in Argentina. The project was awarded to J. Ray
in the fall of 2001 prior to our announcement last year that we
would no longer accept contracts that place a disproportionate
amount of risk on the Company. We have reached an agreement in
principle with the customer to minimize our future risk on this
project. Absent losses from this project, J. Ray would have posted
positive operating results for the quarter," said Bruce W.
Wilkinson, chairman of the board and chief executive officer of
McDermott.

"J. Ray's new management team is in place and will continue to
gain traction over the next several quarters. While I am confident
in the team's ability to deliver improved operational performance
going forward, there is still much to be done to stabilize J.
Ray," continued Wilkinson.

"Given the current situation at J. Ray and the uncertainty
surrounding the passage of the pending asbestos legislation, which
would have a significant impact on our Company, we are withdrawing
the 2003 earnings guidance and feel that it is not prudent at this
time to issue revised guidance for the remainder of 2003," said
Wilkinson.

                      RESULTS OF OPERATIONS

       2003 Second Quarter Compared to 2002 Second Quarter

Marine Construction Services Segment

Revenues from the Marine Construction Services segment, which
consists of J. Ray McDermott and its subsidiaries, increased 48%
to $468.0 million in the 2003 second quarter. The revenue increase
resulted from increased execution of fabrication and marine
installation projects in all geographic areas in which J. Ray
operates other than in the Gulf of Mexico, where activity declined
slightly compared to the 2002 second quarter.

The operating loss of $13.2 million for the 2003 second quarter
resulted primarily from recording a $39.9 million loss provision
for the project in Argentina. As previously reported, on June 11,
2003, due to a sudden change in weather, J. Ray experienced damage
to some pipe-laying equipment and the Derrick Barge 60 while
laying subsea pipe off the coast of southern Argentina. Work was
suspended on the project to assess the remedial action required to
complete the project and complete repairs to the DB60. J. Ray has
very recently reached an agreement in principle, which is subject
to ongoing negotiations, with the customer to minimize future
risks associated with this project. Major projects contributing to
2003 second quarter operating income, excluding the $39.9 million
loss provision discussed above, were the topsides fabrication and
subsea pipeline installation projects in the Azerbaijani sector of
the Caspian Sea, topsides fabrication work in the Morgan City
fabrication facility and charter of a vessel into Mexico. Selling,
general and administrative expenses were $3.4 million lower in the
2003 second quarter compared to the 2002 second quarter. The 2003
second quarter included no additional losses on the Spar projects,
while the 2002 second quarter included losses of $33.9 million on
the Spar projects.

At June 30, 2003, J. Ray's backlog of $1.8 billion included $359
million related to contracts in loss positions. Of this amount
$207 million related to uncompleted work on the Spar projects and
$103 million related to the project in Argentina. Backlog was $2.0
billion and $2.1 billion at March 31, 2003 and at December 31,
2002, respectively.

Government Operations Segment

The Government Operations segment consists primarily of BWX
Technologies Inc. Revenues in this segment decreased $3.6 million
to $127.5 million in the 2003 second quarter primarily due to
lower revenues in management and operations services partially
offset by higher volumes from the manufacture of nuclear
components for certain U.S. government programs. Effective January
1, 2003, BWXT became a teaming partner to complete the
environmental restoration for a U.S. government site in Ohio,
which it previously operated as a prime contractor. This resulted
in the recording of revenues for the subcontract earned fees only
rather than the full revenues from this contract. This caused a
$20 million reduction in revenues for the 2003 second quarter
compared to the 2002 second quarter.

Operating income increased $5.7 million to $20.5 million in the
2003 second quarter, primarily due to the following:

-- higher volumes from the manufacture of nuclear components for
   certain U.S. government programs

-- favorable resolution of a contract dispute

-- improved operating results from joint ventures in Idaho, Texas
   and Tennessee

-- reduced spending on fuel cell research and development projects

These increases were partially offset by lower volumes and margins
from commercial work and other government manufacturing
operations, and higher general and administrative expenses due to
increased facility management oversight costs and higher variable
stock-based compensation expense.

At June 30, 2003, BWXT's backlog was $1.5 billion, compared to
backlog of $1.6 billion and $1.7 billion at March 31, 2003 and
December 31, 2002, respectively.

Corporate

Corporate expenses increased $18.0 million to $21.2 million in the
2003 second quarter compared to $3.3 million in the 2002 second
quarter, primarily due to higher noncash qualified pension plan
expense as a result of changes in the discount rate and plan asset
performance. Additionally, the financial performance of the
Company's captive insurance companies was less favorable during
the 2003 second quarter than in the 2002 second quarter.

Other Income and Expense

Interest income decreased to $0.9 million in the 2003 second
quarter compared to $1.8 million in the 2002 second quarter,
primarily due to decreases in investments and prevailing interest
rates. Interest expense increased $1.8 million to $4.2 million in
the 2003 second quarter, primarily due to interest costs
associated with the Company's credit facility, which was
refinanced in February 2003.

The Company reported other income of $0.7 million in the 2003
second quarter compared to other expense of $0.9 million in the
2002 second quarter due to income resulting from the curtailment
of J. Ray's qualified pension plan and minority interest income
associated with a J. Ray joint venture. Foreign currency
transaction losses partially offset this income.

During the 2003 second quarter, revaluation of certain components
of the estimated settlement cost related to the Chapter 11
proceedings involving B&W resulted in an increase of the estimated
liability to $126.4 million and recognition of other expense of
$39.4 million ($40.0 million after tax). The consideration to be
provided in the proposed settlement includes, among other things,
McDermott common stock, a share price guaranty obligation and a
promissory note. The increase is due primarily to an increase in
the price of McDermott's common stock from $2.90 per share at
March 31, 2003 to $6.33 per share at June 30, 2003. The Company is
required to revalue certain components of the estimated settlement
cost quarterly and at the time the securities are issued, assuming
the settlement is finalized. Assuming issuance of the debt and
equity securities, the Company will record such amounts as
liabilities or stockholders' equity based on the nature of the
individual securities.

For the 2003 second quarter, income tax expense was impacted by
the non-deductible portion of the expense associated with the
revaluation of the estimated cost of settlement of the B&W Chapter
11 proceedings, an increase in the valuation allowance for the
realization of deferred tax assets and the mix of income and
losses from various tax jurisdictions in which the Company
operates.

                    DISCONTINUED OPERATIONS

The Company is in final negotiations to sell Menck GmbH, a
component of the Marine Construction Services segment, and expects
to close the transaction by September 30, 2003. Accordingly, for
the three and six months ended June 30, 2003 and June 30, 2002,
the Company has reported the results of operations for Menck as
discontinued operations.

Hudson Products Corporation was sold in July 2002. Accordingly,
for the three and six months ended June 30, 2002, the Company has
reported the results of operations for HPC as discontinued
operations.

                  THE BABCOCK & WILCOX COMPANY

The Company wrote off its investment in B&W of $224.7 million
during the second quarter of 2002 and has not consolidated B&W
with its financial results since the Chapter 11 bankruptcy filing
on February 22, 2000. B&W's revenues decreased $52.8 million to
$352.3 million in the 2003 second quarter compared to $405.1
million in the 2002 second quarter. Net loss for the 2003 second
quarter of $51.7 million included a $70 million provision for an
increase in B&W's estimated asbestos liability. Net income for the
2002 second quarter was $16.5 million.

                           LIQUIDITY

On a consolidated basis, the Company incurred negative cash flows
for the first two quarters of 2003 and expects to incur negative
cash flows during the remainder of 2003 and in the first half of
2004 primarily due to losses on the Spar projects and the
Argentina project. Completion of the Spar projects and the
Argentina project has and will continue to put a strain on J.
Ray's liquidity. J. Ray intends to fund its negative cash flow
through borrowings under the credit facility, intercompany loans
from McDermott and sales of non-strategic assets including the
sale of Menck and certain marine vessels. For the 2003 year, the
Company anticipates negative operating cash flows before capital
expenditures of between $100 million and $120 million. At August
8, 2003, the Company had liquidity of $146 million, which included
unrestricted cash of $97 million and borrowing capacity of $49
million.

At June 30, 2003, the Company's balance sheet shows a working
capital deficit of about $100 million, and a total shareholders'
equity deficit of about $433 million.

The Company is in the process of refinancing BWXT on a stand-alone
basis and has received a commitment letter from a commercial bank
to underwrite a three-year $125 million revolving credit facility,
which may be increased to $150 million. This commitment is subject
to the successful refinancing of J. Ray on a stand-alone basis.
The Company is in negotiations with a lender to provide financing
to J. Ray and hopes to close both new facilities simultaneously.

The Company's ability to obtain such a replacement facility for J.
Ray will depend on numerous factors including J. Ray's operating
performance and overall market conditions. If J. Ray experiences
additional significant contract costs on its Spar projects, the
Argentina project or any other project as a result of unforeseen
events, it may be unable to fund all of its budgeted capital
expenditures and meet all of its funding requirements for
contractual commitments.

If the Company is unable to obtain a new credit facility for J.
Ray or is unable to replace or extend the existing credit
facility, J. Ray's ability to pursue additional projects, which
often require letters of credit, and its liquidity will be
adversely impacted. These factors cause substantial doubt about J.
Ray's ability to continue as a going concern.

McDermott International Inc. is a leading worldwide energy
services company. The Company's subsidiaries provide engineering,
fabrication, installation, procurement, research, manufacturing,
environmental systems, project management and facility management
services to a variety of customers in the energy and power
industries, including the U.S. Department of Energy.


MEDIACOM COMMS: Fitch Assigns Junk/Low-B Preliminary Ratings
------------------------------------------------------------
Fitch Ratings has initiated coverage of Mediacom Communications
Corporation and its two intermediate holding companies Mediacom
LLC and Mediacom Broadband LLC and their subsidiaries borrowing
entities.

Fitch has assigned a 'CCC+' rating to MCCC's 5.25% senior
convertible notes due 2006. Fitch has assigned a 'B+' rating to
Mediacom LLC's senior unsecured debt including the 8.5% senior
unsecured notes due 2008, the 7.875% senior unsecured notes due
2011 and the 9.5% senior unsecured notes due 2013. Likewise, the
11.0% senior unsecured notes at Mediacom Broadband LLC have been
assigned a 'B+' rating by Fitch. Fitch has assigned a 'BB+' rating
to the $550 million senior secured bank facility at Mediacom
Southeast LLC, Mediacom California LLC, Mediacom Delaware LLC and
Mediacom Arizona LLC. Additionally, Fitch has assigned a 'BB+'
rating to the $550 million senior secured bank facility entered
into by Mediacom Illinois LLC, Mediacom Indiana LLC, Mediacom Iowa
LLC, Mediacom Minnesota LLC, Mediacom Wisconsin LLC, and Zylstra
Communications Corporation. Lastly, Fitch has assigned a 'BB+'
rating to the $1.4 billion senior secured bank facility entered
into by MCC Georgia LLC, MCC Illinois LLC, MCC Iowa LLC, and MCC
Missouri LLC. The Rating Outlook for all of the ratings is Stable.

These rating actions affect approximately $3.05 billion of debt as
of the end of the second quarter of 2003 of which approximately
$1.6 billion is senior secured, $1.2 billion is senior unsecured
and $0.2 billion is senior convertible notes. The senior
convertible notes are subordinated to the senior secured and
unsecured debt.

Fitch's ratings incorporate the expectation that the company will
reach the free cash flow inflection point in the very near term,
the completion of its cable plant modernization program, strong
liquidity position, the continued growth of the company's digital
and high speed data (HSD) products, favorable debt maturity and
bank debt amortization schedule.

The company has completed its cable plant upgrades whereby 98% of
the company's plant is upgraded to 550 MHz to 870 MHz bandwidth
capacity. The upgraded plant is able to provide digital cable
service to approximately 98% of the company's basic subscriber
base and provide high speed data services to approximately 95% of
homes passed.

With the plant upgrade accomplished, the company will benefit from
lower levels of capital expenditures and be in a position to
generate positive free cash flow in the very near term. Fitch
expects the company to generate a nominal amount of free cash flow
during the second half of 2003 and to generate positive free cash
flow throughout 2004. Fitch anticipates that the company's credit
protection metrics will improve over the near term benefiting from
the reduced debt balances stemming from the positive free cash
flow and continued EBITDA growth as the company continues to add
digital and HSD subscribers.

Key to the company's expected free cash flow growth is the EBITDA
generated from HSD subscribers. For the second quarter 2003 the
company had a total of 234,000 HSD subscribers, an increase of 62%
over the year ago period and 20,000 subscriber increase relative
to the first quarter of 2003. Data revenue expanded by 64.5%
compared to the second quarter data revenue level. From Fitch's
perspective a significant portion of the company's 9.2% year over
year EBITDA growth is attributable to the HSD product.

Fitch's ratings also reflect the negative impact on subscriber
metrics, revenue growth, and margin performance stemming from the
launch of local broadcasts into local markets by the direct
broadcast satellite operators into many of the company's service
areas. At the end of the second quarter of 2003 approximately 34%
of the company's basic subscriber base had local into local
service available from DBS operators. Based on the DBS operator's
plans to launch local into local service in many smaller markets
this year, Fitch expects that up to 62% of the company's basic
subscriber base will be covered by a local into local offerings.
The most vulnerable subscribers to competitive pressures, from
Fitch's viewpoint, are price sensitive subscribers not on a
digital or HSD plan and users that only subscribe to the basic
service tier. Fitch's perspective is that the company is well
suited to respond to the elevated competition with its upgraded
cable plant and service bundling strategy.

At the end of the second quarter 2003 the company reported $3.05
billion of debt on its balance sheet. Leverage (total debt-to-LTM
EBITDA) at the end of the second quarter stood at 7.65 times
through the senior convertibles. Fitch expects the company's year-
end leverage to decrease slightly to under 7.6x. Fitch expects
leverage metric to continue to improve through 2004 benefiting
from free cash flow generation and continued EBITDA growth. For
the year ended 2004, Fitch's leverage expectation is between 6.75x
and 6.85x. Cash from operations coupled with available capacity
under the company's three credit facilities will provide the
company with sufficient cash resources to meet cash requirements.
At the end of the second quarter of 2003 the company had
approximately $663 million of available liquidity under the most
restrictive covenants within the company's bank agreements. The
company's liquidity position is supported by relatively light bank
amortization schedule. Required bank term amortization is
approximately $50 million through 2005. No public debt is
scheduled to mature before 2006 when the convertible senior notes
become due.

The Stable Rating Outlook reflects Fitch's expectation that the
company's digital and high speed penetration rates will continue
to improve during 2003. Fitch would view negatively a capital
expenditure budget for the company's planned telephony initiative
that would put positive free cash flow in jeopardy.

These ratings are based on existing public information and are
provided as a service to investors.


MIRANT CORP: Court OKs White & Case Engagement on Interim Basis
---------------------------------------------------------------
Pursuant to Section 327(a) of the Bankruptcy Code, Mirant Corp.,
and its debtor-affiliates seek the Court's authority to employ
White & Case LLP as their attorneys, nunc pro tunc to July 14,
2003.

The Debtors selected White & Case because of the firm's knowledge
of the Debtors' businesses and financial affairs, and its
extensive broad-based experience and knowledge in Chapter 11
reorganization.  Since late 1999, the Debtors have retained White
& Case with respect to a variety of issues, including the
California energy crises and the bankruptcy filings of Enron and
affiliates.  In addition, White & Case has provided restructuring
and bankruptcy advice, performed due diligence and prepare the
requisite petitions, pleadings and other documents submitted in
connection with the commencement of the Debtors' Chapter 11
cases.

White & Case informed the Debtors that Thomas E. Lauria, Esq., a
partner at White & Case, will act as lead counsel for the
Debtors' cases.  Mr. Lauria is a member of good standing, among
others, in the Bars of the States of Texas and Florida, the U.S.
District Court for the Northern and Southern Districts of Texas
and the Middle and Southern Districts of Florida and the U.S.
Court of Appeals for the Fifth and Eleventh Circuits.

John W. Ragan, Mirant's Senior Vice President for North America
Operations, tells the Court that since White & Case does not have
an office in Texas, Haynes and Boone will serve as the Debtors'
Texas counsel.  Mr. Ragan assures the Court that all of the
Debtors' counsels employed have divided their responsibilities
and will make every effort to avoid or minimize the duplication
of services to the Debtors.  As lead counsel to the Debtors,
White & Case will coordinate the responsibilities and activities
of all of the firms retained in these cases to maximize
efficiency.

Accordingly, Mr. Ragan contends that White & Case is well
qualified and uniquely able to represent the Debtors in their
Chapter 11 cases in a most efficient and timely manner.

As counsel, White & Case will:

    (a) take all necessary 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 the Debtors' behalf all necessary motions,
        applications, answers, orders, reports, and papers in
        connection with the administration and prosecution of the
        Debtors' Chapter 11 cases;

    (c) assist the Debtors in connection with any proposed sale
        of assets pursuant to Section 363 of the Bankruptcy Code;

    (d) assist the Debtors in the formulation and negotiation of
        a plan or plans of reorganization and all related
        transactions;

    (e) advise the Debtors in respect of energy, real estate,
        securities, labor law, intellectual property, licensing
        and tax matters and other services as requested; and

    (f) perform all other necessary legal services in connection
        with these Chapter 11 cases.

To the best of his knowledge, Mr. Lauria says, White & Case and
its professionals do not have any connection with or any adverse
interest to the Debtors, their creditors or any other party-in-
interest, or their attorneys and accountants, except as disclosed
to the Court.  Thus, Mr. Lauria asserts that White & Case is
"disinterested" as that term is defined in Section 101(14) of the
Bankruptcy Code.

According to Mr. Lauria, in the ordinary course of business, the
Debtors regularly engage in intercompany transactions between and
among each other, resulting in numerous intercompany
relationships, debits and credits.  However, the Debtors do not
believe that their relationship with one another pose any
conflict of interest in these cases because of their general
unity of interest at all levels.  Hence, Mr. Ragan asserts that
White & Case's employment is permissible under the Bankruptcy
Code.

Mr. Lauria relates that six months prior to the Petition Date,
White & Case received from the Debtors a $2,500,000 general
retainer to secure payments of all services rendered and costs
incurred on the Debtors' behalf.  Thereafter, White & Case
continued to regularly bill the Debtors for services rendered and
costs incurred and the Debtors paid the bills in the ordinary
course of business.  Immediately prior to the Petition Date,
White & Case estimated the amount of unbilled fees and costs
incurred through the Petition Date and applied the retainer to
the estimated amount, with the balance of the retainer to be held
against postpetition fees and costs.  However, to date, a final
reconciliation has not been completed.  Mr. Lauria promises that
once the reconciliation is completed, White & Case will file a
subsequent disclosure with the Court.

For the services to be rendered postpetition, White & Case will
seek Court approval for the payment of compensation and
reimbursement of necessary expenses in accordance with its
customary hourly rates in effect from time to time.  White &
Case's current rates for its attorneys and paraprofessionals
range from $90 to $750 per hour.

                         *     *     *

On an interim basis, Judge Lynn permits the Debtors to employ
White & Case effective as of July 14, 2003. (Mirant Bankruptcy
News, Issue No. 4; Bankruptcy Creditors' Service, Inc., 609/392-
0900)


MORGAN STANLEY: Fitch Firms Low-B Ratings on Five Note Classes
--------------------------------------------------------------
Morgan Stanley's commercial mortgage pass-through certificates,
series 1998-HF2, the $10.6 million class M is downgraded to 'CC'
from 'CCC' by Fitch Ratings. In addition, Fitch upgrades the
following classes:

        -- $52.9 million class B to 'AAA' from 'AA';
        -- $52.9 million class C to 'AA' from 'A';
        -- $58.2 million class D to 'A-' from BBB';
        -- $21.2 million class E to 'BBB' from 'BBB-';
        -- $23.8 million class F to 'BBB-' from 'BB+'.

Fitch also affirms the following classes:

        -- $104.2 million class A-1 'AAA';
        -- $547.8 million class A-2 'AAA';
        -- Interest only class X 'AAA';
        -- $18.5 million class G 'BB';
        -- $10.6 million class H 'BB-';
        -- $21.2 million class J 'B+';
        -- $10.6 million class K 'B';
        -- $15.9 million class L 'B-'.

The $10.6 million class N is not rated by Fitch. The rating
affirmations follow Fitch's annual review of the transaction,
which closed in November 1998.

The downgrade to class M is due to current expected loss
estimates. Fitch will continue to monitor the loans of concern and
if greater than expected loss severities are applied to the trust,
additional downgrades are likely to the non-investment grade
classes. The rating upgrades are a result of continued pool
performance and additional credit enhancement provided by the
reduction of the collateral balance.

GMAC Commercial Mortgage Corp., the special servicer, collected
year-end 2002 financials for 86% of the pool. The weighted average
debt service coverage ratio for the pool is at 1.42 times.

There are five loans currently in special servicing which account
for 3.7% of the pool. The largest loan in special servicing was
originally a Best Western Landmark hotel, however the property was
re-flagged as a Holiday Inn Select. The loan was transferred to
special servicing when the costs of re-flagging the hotel exceeded
the budget and the borrower had difficulty making debt service
payments. The outstanding balance is $11 million and it is
approximately 1.1% of the pool. The second largest loan in special
servicing is Summerwood Apartments, which is current and located
in Redmond, Washington. The borrower filed for bankruptcy in June
2003, a cash collateral order is in place and cash flow is
sufficient to meet debt service at this time.

Hypothetical stress scenarios were applied to the trust, where
specially serviced and other loans that concerned Fitch as having
the potential to become problematic were assumed to default. Under
these stress scenarios, the resulting subordination level of class
M necessitated the downgrade. Fitch will continue to monitor this
transaction, as surveillance is ongoing.


NATIONAL STEEL: Takes Action to Challenge Various Claims
--------------------------------------------------------
National Steel Corporation and its debtor-affiliates object to 168
Claims filed against them.

                          Duplicate Claims

During the review process, the Debtors determined that 48 proofs
of claim filed against them represent duplicate claims based on a
single liability.  In certain cases, the claimants filed
identical proofs of claim asserting the same claim against the
Debtors.  In other cases, the duplicate original proofs of claim
were filed and Logan & Company, Inc., the Debtors' Notice Agent,
assigned a separate claim number to each one.

The Debtors argue that claimants are not entitled to multiple
recoveries on a single liability.  Accordingly, as a bookkeeping
matter, the Debtors want to eliminate the Duplicate Claims from
their claims register.  The amount for all Duplicate Claims to be
disallowed total $2,508,784.

                     Amended, Superseded Claims

The Debtors determined that certain proofs of claim filed against
them have been superseded by the filing of amendments to
previously filed claims.  The Debtors identify 34 Superseded
Claims as claims to be disallowed, totaling $5,474,027.  The
corresponding Amended Proofs of Claim, on the other hand, are
considered to be the surviving claims.

                 No Supporting Documentation Claims

The Debtors have also determined that certain proofs of claims
filed against them contain no documentation to support the amount
or the validity of the claim asserted.  The Debtors contend that
the No Supporting Documentation Claims do not comport with Rule
3001(c) of the Federal Rules of Bankruptcy Procedure, which
requires that "when a claim, or an interest in property of the
debtor securing the claim, is based on a writing, the original or
duplicate shall be filed with the proof of claim."

The Debtors identify 34 No Supporting Documentation Claims to be
disallowed, aggregating $2,409,448.

                    Improperly Classified Claims

The Debtors found out that certain claimants filed proofs of
claim against them that assert a priority entitlement, pursuant
to Section 507(a) of the Bankruptcy Code to which the claimants
are not entitled.

The Debtors identify Improperly Classified Claims as those claims
which need to be reclassified from a present priority status to
the modified priority status.  The reclassified claims will not
be allowed at this time but will remain subject to further review
and possible objection.

There are 52 Improperly Classified Claims amounting to $504,531.

By this objection, the Debtors ask the Court to:

    -- disallow and expunge the Duplicate Claims in their
       entirety;

    -- disallow and expunge Superseded Claims and to allow them to
       review Amended Claims;

    -- disallow and expunge No Supporting Documentation Claims in
       their entirety; and

    -- reclassify Improperly Classified Claims to the modified
       priority status. (National Steel Bankruptcy News, Issue No.
       33; Bankruptcy Creditors' Service, Inc., 609/392-0900)


NAVISITE INC: Completes Acquisition of Certain ClearBlue Assets
---------------------------------------------------------------
NaviSite, Inc. (Nasdaq: NAVI), a leading provider of Application,
Messaging, and Infrastructure Management Services, completed the
acquisition of the significant operational assets and certain
liabilities of ClearBlue Technologies, Inc., on Friday, August 8,
2003.

Under the terms and conditions of the agreement, which were
reviewed, negotiated and approved by an independent committee
appointed by the Board of Directors of NaviSite, NaviSite
exchanged approximately 1.1 million shares of common stock for
100% ownership of, or the right to acquire, ten subsidiaries of
CBT that operate data centers. NaviSite acquired six of the CBT
subsidiaries upon the closing of the transaction held today.
NaviSite will assume the revenue and expense of an additional four
subsidiaries of CBT, ownership of which will automatically be
transferred under certain conditions to NaviSite for no additional
consideration in February 2004.

NaviSite has been operating these 10 data centers under an
outsourcing agreement signed with CBT on December 31, 2003.

In connection with this transaction, NaviSite also acquired
certain assets and liabilities held by CBT relating to the
operations of these data center subsidiaries, including customer
contracts, equipment and equipment leases, employees, third party
contractors, and insurance contracts.

"In addition to the synergy of people and processes, this
transaction is designed to make our business more transparent to
our customers, employees and investors and allow them to
understand the true value of the NaviSite business and strategy"
said Arthur Becker, CEO of NaviSite.

Founded in 1997, NaviSite, Inc, (NASDAQ: NAVI) is a leading
provider of application, messaging and infrastructure management
services for more than 800 customers consisting of mid-market
enterprises, divisions of large multinational companies, and
government agencies. For more information, please visit
http://www.navisite.com

                          *    *    *

Navisite Inc.'s April 30, 2003 balance sheet shows a working
capital deficit of about $9 million, and a total shareholders'
equity deficit of about $6 million.


NEXTERA ENTERPRISES: Has Until Oct. 7 to Meet Nasdaq Guidelines
---------------------------------------------------------------
Nextera Enterprises, Inc. (NASDAQ: NXRA), which consists of
Lexecon, one of the world's leading economics consulting firms,
has received notification from Nasdaq granting the Company an
additional 60 days, or until October 7, 2003, to regain listing
compliance with the minimum $1.00 per share closing bid price
requirement.

Under Nasdaq SmallCap Market rules, Nextera must demonstrate
compliance by evidencing a minimum closing bid price of $1.00 per
share by October 7, 2003, and immediately thereafter, a closing
bid price of at least $1.00 per share for a minimum of 10
consecutive trading days or its common stock will be delisted.

Nextera Enterprises Inc., through its wholly owned subsidiary,
Lexecon, provides a broad range of economic analysis, litigation
support, and regulatory and business consulting services. One of
the nation's leading economics consulting firms, Lexecon assists
its corporate, law firm and government clients reach decisions and
defend positions with rigorous, objective and independent
examinations of complex business issues that often possess
regulatory implications. Lexecon has offices in Cambridge and
Chicago. More information can be found at http://www.nextera.com
and http://www.lexecon.com

                          *     *     *

                 Liquidity and Capital Resources

In its SEC Form 10-Q for the quarter ended March 31, 2003, Nextera
Enterprises reported:

"Consolidated working capital was $6.1 million on March 31, 2003,
compared to a working capital of $5.2 million on December 31,
2002. Included in working capital were cash and cash equivalents
of $0.6 million and $1.6 million on March 31, 2003 and
December 31, 2002, respectively.

"Net cash used in operating activities was $8.4 million for the
three months ended March 31, 2003. The primary components of net
cash used in operating activities was an increase of $5.0 million
of prepaid and other assets (relating to Messrs. Fischel and
Carlton's non-compete agreements), an increase of $4.4 million of
accounts receivable, a $1.6 million decrease of accounts payables
and accrued expenses (primarily bonus payments), and a net loss of
$3.1 million. These cash outflows were offset in part by $5.2
million of non-cash items relating to depreciation, provision for
doubtful accounts, amortization of non-compete agreements, non-
cash compensation charges, and interest paid-in-kind.

"Net cash provided by investing activities was $2.6 million for
the three months ended March 31, 2003, almost entirely
representing decreases in restricted cash.

"Net cash provided by financing activities was $4.8 million for
the three months ended March 31, 2003. The primary component of
net cash provided by financing activities was $5.0 million of
borrowings under the Company's Senior Credit Facility.

The Company's primary sources of liquidity are cash on hand,
restricted cash (for bonus payments only) and cash flow from
operations. The Company believes that if it is successful in
reducing its current days sales outstanding level and achieving
its forecasted profitability, it will have sufficient cash to meet
its operating and capital requirements for the next twelve months.
However, there can be no assurances that the Company's actual cash
needs will not exceed anticipated levels, that the Company will
generate sufficient operating cash flows, by reducing its current
days sales outstanding level and achieving its forecasted
profitability, to fund its operations in the absence of other
sources or that acquisition opportunities will not arise requiring
resources in excess of those currently available. In particular,
the Company has the option of extending the employment and non-
compete agreements with Messrs. Fischel and Carlton from their
current expiration of July 16, 2003 to January 15, 2004. In order
to exercise such option, the Company must pay Messrs. Fischel and
Carlton an aggregate amount of approximately $3.5 million,
including interest, on or before July 15, 2003 and an aggregate
amount of approximately $1.6 million, plus interest at 3.5% per
annum from January 15, 2003 through the date paid, within five
days of collection of a specified receivable but in no case later
than December 31, 2003, whether or not the receivable is collected
by that date. The Company hopes to exercise such option from cash
flows from operations, however, such funding from operations is
dependent upon reducing current days sales outstanding and
achieving forecasted profitability. To the extent that cash flows
from operations are not sufficient, the Company will need to
obtain alternative financing sources. In order for the Company to
further extend these agreements from January 16, 2004 through
December 31, 2008, the Company will need to make aggregate
payments to Messrs. Fischel and Carlton of $20.0 million by
January 15, 2004. We will require additional financing in amounts
that we cannot determine at this time in order to make all of the
payments required to extend these agreements to December 31, 2008.
We expect that we will need to raise funds through one or more
public or private financing transactions.

"Effective December 31, 2002, the Company entered into a Second
Amended and Restated Credit Agreement, which amended the Prior
Credit Agreement. As part of the Senior Credit Facility, Knowledge
Universe, Inc. purchased a $5.0 million junior participation in
the Senior Credit Facility. On January 7, 2003, the Company
borrowed $5.0 million under the Senior Credit Facility to fund the
first payment required under the employment and non-compete
agreements entered into with Messrs. Fischel and Carlton. The
Company's outstanding liability under the Senior Credit Facility
after the borrowing of the above mentioned $5.0 million was $32.2
million. The Senior Credit Facility requires that $4.7 million of
outstanding borrowings be permanently reduced in each of 2003 and
2004. The maturity of the Senior Credit Facility was extended to
January 1, 2005. Borrowings bear interest at the lender's base
rate plus 1.5%. The Company will continue to pay annual
administrative fees of $0.3 million, payable monthly, and the $0.9
million in aggregate back-end fees will continue to be payable
upon the maturity of the Senior Credit Facility. The back-end fees
can be waived if the Company repays the Senior Credit Facility
prior to maturity. All administrative fees paid to the senior
lenders are recorded by the Company as interest expense. An
affiliate of Knowledge Universe has agreed to continue to
guarantee $2.5 million of the Company's obligations under the
Senior Credit Facility. The Senior Credit Facility contains
covenants related to the maintenance of financial ratios,
operating restrictions, restrictions on the payment of dividends
and disposition of assets. The covenants are measured quarterly
and have been set at varying rates, the most restrictive at
approximately 15% below the Company's projected operating results.
If the results of operations significantly decline below projected
results and we are unable to obtain a waiver from the Company's
senior lenders, the Company's debt would be in default and
callable by the senior lenders. If our projections of future
operating results are not achieved and our debt is placed in
default, we would experience a material adverse impact on our
reported financial position and results of operations."


NRG ENERGY: Court Okays Trading Contracts Settlement Procedures
---------------------------------------------------------------
NRG Energy, Inc., and its debtor-affiliates' businesses are
sensitive to fluctuations in energy and energy related commodities
prices, interest rates and foreign currency exchange rates.  In
the ordinary course of business, the Debtors enter into derivative
contracts to reduce the risks associated with such fluctuations.
As a general matter, derivative contracts are financial contracts
whose values are based on, or "derived" from, the price of a
traditional security such as a stock or bond, an asset such as a
commodity -- e.g., coal, fuel oil, natural gas -- or a market
index.  Derivative contracts can take a number of different forms,
including forward contracts, futures contracts, swap contracts,
option contracts or a combination.

Recognizing the unique status of certain derivative contracts in
the financial and commodity markets, Congress added to the
Bankruptcy Code certain so-called "safe harbor" provisions in
Sections 555, 556, 559 or 560 of the Bankruptcy Code regarding
the Derivative Contracts to which a debtor-in-possession is a
party.

Among the "safe harbor" rights and protections under the
Bankruptcy Code are provisions that:

    (a) allow the non-debtor party to terminate, liquidate and
        apply collateral held under a Safe Harbor Contract upon a
        bankruptcy of the other party, notwithstanding Section
        365(e)(1) of the Bankruptcy Code;

    (b) protect prepetition payments made under a Safe Harbor
        Contract by the debtor to the non-debtor party from the
        avoidance powers of a trustee or debtor-in-possession
        except in particular cases of actual intent to defraud
        other creditors; and

    (c) permit the non-debtor party to set off mutual debts and
        claims against the debtor under a Safe Harbor Contract
        without the need to obtain relief from the automatic
        stay; provided that the Safe Harbor Contracts allow for
        the set-off.

According to Michael A. Cohen, Esq., at Kirkland & Ellis, in New
York, prior to the Petition Date, the Debtors entered into
various Derivative Contracts, many of which are also Safe Harbor
Contracts, in the ordinary course of business to reduce or hedge
existing or expected risks associated with fluctuations in energy
and energy-related commodities prices, interest rates and foreign
currency exchange rates.

The Debtors anticipate that after the Petition Date, many of the
Safe Harbor Contracts will be validly terminated postpetition by
either the contract counterparty or the Debtors.  Each time a
contract is terminated, a termination payment needs to be
calculated.  The Debtors also anticipate that certain contracts
may have been terminated prior to the Petition Date but the
termination payment may not be determined until after the
Petition Date.  The payment may be owed to the Debtor or by the
Debtor, depending on the market value of the contract and the
early termination provisions.

Generally, Mr. Cohen informs the Court, Safe Harbor Contracts are
documented in the form of:

    -- master agreements, including the Master Netting Agreements,

    -- confirmations issued under general terms and conditions,

    -- enabling agreements, or

    -- single transaction agreements.

These Transaction Agreements set forth terms and conditions that
govern various transactions entered into between the parties from
time to time.

Where a master agreement is used, a number of widely used
standard forms exist for both physical and financial transactions
of the type entered into by the Debtors and the counterparties.
The parties to a master agreement then enter into individual
transactions under the master agreements.  These individual
transactions are customarily documented in the form of
confirmations, which set forth specified quantities and delivery
dates for physical transactions, and specified methods for
calculation of payment amounts and specified payment dates for
financial transactions.

            Early Termination And Termination Payments

Among the typical "safe harbor" provisions is the right of a
qualifying non-debtor party to terminate a Safe Harbor Contract
due to the commencement of a bankruptcy case by the other party.
This event is generally designated under the Transaction
Agreements as an "early termination event" or an "event of
default."

Subject to the terms of the Transaction Agreements, proper
termination upon an early termination event or an event of
default is typically accomplished by:

    (a) both parties ceasing all performance under the
        transactions,

    (b) the non-defaulting party determining the amounts payable
        by each party to the other party at the time of
        termination, and

    (c) the "netting" of the amounts due to and from each party
        to a Transaction Agreement, thereby reaching a net
        settlement amount payable by one party -- the Termination
        Payment.

Under many Transaction Agreements, a Termination Payment would be
payable by either the defaulting party or the non-defaulting
party.  Thus, termination may result in a net payment to the
Debtors.  These "in-the-money" agreements, where an embedded net
amount due to the Debtors is present, Mr. Cohen points out,
constitute significant assets of the Debtors' estates.

        The Master Netting, Setoff and Security Agreements

Many Transaction Agreements expressly address the rights of set-
off and netting.  Certain Debtors and counterparties have entered
into master netting, set-off and security agreements pursuant to
which one or more Debtors, on the one hand, and one or more
affiliated counterparties, on the other hand, agree to aggregate
their exposures under two or more Transaction Agreements to
determine their exposure thresholds and collateral requirements,
as well as to exercise early termination, liquidation, netting
and set-off rights across different Transaction Agreements and
different affiliated counterparties that have signed the Master
Netting Agreement.

Where the Debtors and the counterparties have entered into a
Master Netting Agreement, if provided therein, the default and
termination remedies of the Master Netting Agreement replace the
default and termination remedies of those particular Transaction
Agreements covered by the Master Netting Agreement.  In these
instances, the Master Netting Agreement provides its own
Termination Payment payable upon the occurrence of an early
termination event.

Accordingly, the Debtors ask the Court to:

    (1) establish procedures permitting the settlement of validly
        terminated Safe Harbor Contracts, and

    (2) authorize them to:

          (i) continue entering into, "rolling over," adjusting,
              modifying and settling Derivative Contracts for the
              purpose of hedging the Debtors' risk to fluctuations
              in energy and energy-related commodities prices and
              changes in interest rates and foreign currency
              exchange rates, and

         (ii) perform all other actions necessary or appropriate
              to implement, execute and perform the transactions,
              including, but not limited to, posting letters of
              credit, entering into escrow agreements, opening and
              funding escrow accounts, posting collateral or
              margin, prepayment and delivery of settlement on
              account of Derivative Contracts.

                  Protocol on Settlement of Amounts

The Debtors propose a protocol by which they will advise the
Official Committee of Unsecured Creditors and Xcel Energy Inc. of
potential settlement agreements with counterparties with respect
to a Termination Payment under a Safe Harbor Contract.  The
Protocol provides that, prior to entering into a settlement
agreement with respect to a Termination Payment under a Safe
Harbor Contract, the Debtors must submit the proposed settlement
agreement to the Creditors' Committee and where applicable, Xcel,
for approval.

The Creditors' Committee and Xcel will have 10 business days to
approve or disapprove the settlement.  To the extent a member of
the Creditors' Committee is (i) a counterparty to a Safe Harbor
Contract, which is a Settling Party, or (ii) a competitor of
Debtors, that member will not participate in the review process
and will not receive or review any of the detailed information
provided to the Creditors' Committee other than the Settlement
Notice filed with the Court.

Where each of the Creditors' Committee and Xcel either approves
the proposed settlement or does not disapprove it during the 10-
business day period, the Debtors will file a notice of the
settlement with the Court.  The Settlement Notice will:

    (a) identify each Safe Harbor Contract subject to the
        settlement,

    (b) identify the parties to the settlement agreement,

    (c) summarize the terms of the settlement agreement, and

    (d) provide a concise statement by the Debtors of the
        rationale for the settlement.

The Settlement Notice will be served on the counterparties or
their counsel, if known, counsel to the Creditors' Committee,
Xcel, the U.S. Trustee for the Southern District of New York,
counsel to any postpetition lenders and all parties that filed
requests for special notice in these Chapter 11 cases.  Unless an
objection is filed and served within five business days after the
Settlement Notice is filed and served on the parties listed, the
Debtors will be authorized to consummate the proposed settlement,
and the parties receiving notice of the proposed settlement will
be deemed to have consented to the settlement.  If an objection
to the proposed settlement is timely filed and served, the matter
will be heard at a hearing before the Court.

In the event that a net payment is due to the Debtors under a
proposed settlement, the Debtors will collect the payment and the
appropriate releases will be entered into among the Debtors and
the counterparty.  In the event that a net payment is due from
the Debtors, no payment will be made, but the counterparty may
have a liquidated claim in the actual amount of any net payment
payable to the counterparty.

If the Creditors' Committee or Xcel does not approve a proposed
settlement agreement, the Debtors may seek approval of the
proposed settlement upon notice and a hearing in accordance with
Rule 9019(a) of the Federal Rules of Bankruptcy Procedure.

Mr. Cohen asserts that Bankruptcy Rule 9019 permits the Court to
authorize certain classes of settlements to occur without further
Court approval.  In NRG's case, each settlement will be filed
with the Court.  Accordingly, the Debtors seek only to expedite
the approval process under Bankruptcy Rule 9019(b).

Mr. Cohen explains that the Debtors' request will:

    -- preserve the value of volatile assets of the Debtors'
       estates,

    -- expedite the payments collection owed to the Debtors, and

    -- reduce the costs associated with the determination of
       Termination Payments.

Out of an abundance of caution, the Debtors also ask the Court to
determine that the Derivative Contracts are "ordinary course
transactions" within the meaning of Section 363(c)(1) of the
Bankruptcy Code, or in the alternative, allow the Debtors to
continue this business practice pursuant to Section 105(a) of the
Bankruptcy Code.

The Debtors must be able to enter into Derivative Contracts and
must be able to maintain the confidentiality of the basic terms
of the Derivative Contracts, Mr. Cohen maintains.  Given the
confidential and immediate nature of entering into Derivative
Contracts, it is impracticable and counterproductive to require
the Debtors to seek separate approval of each Derivative
Contract.

The Debtors further believe that entering into, "rolling over,"
adjusting, modifying and settling Derivative Contracts are in the
ordinary course of their businesses.  Thus, there is no need for
a notice and a hearing to consummate these transactions.
However, to provide important assurances to existing and
potential counterparties, the Debtors ask the Court to grant
their request.

Mr. Cohen contends that the Debtors' request is warranted given
that companies in the Debtors' industry routinely enter into
these transactions; and the Debtors routinely entered into these
transactions in the past and, accordingly, a hypothetical
creditor would not be exposed to a different risk than it
previously expected when it provided credit to the Debtors.

Moreover, the Debtors are concerned that without the express
authority to continue to pledge collateral under certain of the
Derivative Contracts, counterparties may terminate the Derivative
Contracts out of concern that if the Debtors post collateral, the
transaction may be avoided under Section 549 of the Bankruptcy
Code.

Mr. Cohen relates that under certain Derivative Contracts, on an
ongoing basis, the Debtors are required to:

    -- post cash collateral or letters of credit, or

    -- pledge certain of the Debtors' assets, or

    -- make a prepayment to the counterparty in circumstances
       where the Debtors' obligations to the counterparty exceeds
       a predetermined threshold.

The Debtors may make similar commitments for the Derivative
Contracts that they enter into postpetition.  Accordingly, the
Debtors seek express authority to pledge collateral under
Derivative Contracts as appropriate.

In contrast, Mr. Cohen argues, limiting the Debtors' ability to
enter into the Derivative Contracts would:

    (a) cause disruption to the Debtors' operations,

    (b) require the immediate attention of the Debtors' management
        at a time when their resources are extremely stressed, and

    (c) expose the Debtors' ability to successfully reorganize to
        fluctuations in energy and related commodities prices,
        interest rates and foreign currency exchange rates, which
        is counter-productive to Debtors' reorganization efforts.

                          *     *     *

Judge Beatty authorizes the Debtors to establish and implement
the Protocol for the Settlement of Trading Contracts, including
but not limited to the Court approval procedures of the Protocol,
with respect to the contracts defined as Derivative Contracts
containing "safe harbor" provisions.

Furthermore, the Court orders that:

    (a) The Protocol will not alter, modify or limit in any way
        the terms of the Trading Contracts;

    (b) The Protocol will not limit the rights of the Debtors or
        any counterparty to the Trading Contracts under the
        Trading Contracts, the relevant provisions of the
        Bankruptcy Code, or otherwise;

    (c) The Debtors are authorized to enter into Derivative
        Contracts and related transactions without further order
        of the Court; and

    (d) The Debtors are authorized to pledge collateral, letters
        of credit or other similar security under the Derivative
        Contracts as the Debtors deem appropriate without further
        Court order. (NRG Energy Bankruptcy News, Issue No. 7;
        Bankruptcy Creditors' Service, Inc., 609/392-0900)


OWENS CORNING: Committee Wins Approval to Hire Towers Perrin
------------------------------------------------------------
The Official Unsecured Creditors' Committee, appointed in Owens
Corning's bankruptcy proceedings, seeks the Court's authority to
retain Towers, Perrin, Forster & Crosby, Inc. as actuarial and
benefits consultant for the purpose of providing certain services,
nunc pro tunc to March 5, 2003.

The Committee selected Towers Perrin as its actuarial and benefits
consultant because of the firm's extensive and diverse experience,
knowledge and reputation in the actuarial and benefits field,
because of the firm's understanding of the issues involved in
these Chapter 11 cases, and because the Committee believes that
Towers Perrin is well-qualified to provide the actuarial and
benefits consulting services and expertise that are required by
the Committee in these Chapter 11 cases.

Joel Klein of PPM America/Jackson National Life Insurance Co.,
the Committee's Co-Chairperson, informs the Court that Towers
Perrin's experience includes serving as the actuary and benefits
consultant to several airlines, steel companies, manufacturers
and one utility in bankruptcy, among others.  One of bankruptcies
is also the result of asbestos litigation.

The Committee believes that Towers Perrin's services are both
necessary and appropriate and will assist the Committee in the
negotiation, formulation, development and implementation of a
plan of reorganization.

Towers Perrin provides expert services regarding pension plan and
benefits liabilities and funding obligations.  The services
Towers Perrin may perform for the Committee include, but are not
limited to:

   1. evaluating the actuarial assumptions in the Debtors'
      pension plan;

   2. evaluating the Debtors' proposed funding requirements for
      the Debtors' pension plan;

   3. estimating the funding requirements for the Debtors'
      pension plan;

   4. testifying in Court on the Committee's behalf, if
      necessary; and

   5. performing any other necessary services as the Committee or
      the Committee's counsel may request from time to time with
      respect to any actuarial and benefits issue.

Towers Perrin will be compensated on an hourly basis.  The firm's
current hourly rates are:

      Senior Consultant and Actuary          $610
      Technical Services Actuary              585
      Junior Actuary                          375 - 480
      Actuarial Staff                         265 - 320
      Support Staff                           130

Towers Perrin includes in its hourly rates:

   1. direct labor costs;

   2. fringe benefits;

   3. overhead; and

   4. fees.

Hourly rates do not include out-of-pocket expenses, like travel,
meals and lodging.  These expenses are billed at cost in addition
to the hourly rate.  This compensation arrangement is consistent
with and typical of the arrangements entered into by Towers
Perrin regarding the provision of similar services for clients
like the Committee.

Jerry Spigal, Towers Perrin's Principal and Consulting Actuary,
informs the Court that Towers Perrin is a "disinterested person"
within the meaning of Section 101(14) of the Bankruptcy Code, and
holds no interest adverse to the Debtors and their estate for the
matters for which Towers Perrin is to be employed and Towers
Perrin has no connection to the Debtors, their creditors or
related parties.

Mr. Spigal further discloses that:

   1. In the ordinary course of Towers Perrin's business, it may
      provide or has and continues to provide consulting services
      to certain bankers, insurance companies, law firms,
      accounting firms and other entities which may be creditors
      or professional advisors or perform services for the
      Debtors in relation to matters involving the Debtors and
      not involving the matters for which Towers Perrin is to be
      employed.  Towers Perrin believes that the relationship
      with these entities does not create a conflict.  Although
      Towers Perrin cannot determine with certainty that none of
      the existing Towers Perrin clients have requested advice
      regarding the Debtors in connection with their bankruptcy
      filing, they can state that as to each of those clients,
      fees for professional services as a percentage of Towers
      Perrin revenue is de minimis;

   2. Tillinghast, a division of Towers Perrin, provides
      actuarial services to insurers and their counsel.  The
      relevant services involve projection of aggregate loss
      reserve requirements.  Depending on materiality, these
      analyses may explicitly or implicitly provide for liability
      arising from asbestos.  Towers Perrin cannot determine all
      of these clients because where asbestos liability is
      material, they would not necessarily be aware that the
      company provided coverage to the Debtors.  The aggregate
      loss reserves would however implicitly include provision
      for the losses;

   3. Towers Perrin is not a creditor in these proceedings; and

   4. It is possible that certain employees of Towers Perrin hold
      interest in mutual funds or other investment vehicles that
      may own the Debtors' securities;

Mr. Spigal assures the Court that Towers Perrin will conduct an
ongoing review of its files to ensure that no conflicts or other
disqualifying circumstances exist or arise.  If any new facts or
relationships are discovered, Towers Perrin will supplement its
disclosure with the Court.

                         *     *     *

The Court permits the Creditors' Committee to retain Towers
Perrin, nunc pro tunc to March 5, 2003.

Moreover, Judge Fitzgerald authorizes both the Official Committee
of Asbestos Claimants and the Official Representative for Future
Claimants, without subpoena, to have access to the interim
reports, if any, and to the final report that Towers Perrin
prepares for the Committee and to any other work product but only
after the final report is prepared and only to the extent that it
does not deprive the Committee of the full benefits of having
Towers Perrin as a testifying expert if there is hearing on the
issue.

Judge Fitzgerald further orders that in the event the Committee
withholds any work product, a redacted version with the basis for
the redaction stated will be produced.  All work products will be
produced within 15 days after the final report is prepared. (Owens
Corning Bankruptcy News, Issue No. 55; Bankruptcy Creditors'
Service, Inc., 609/392-0900)


PAC-WEST TELECOMM: Regains Compliance with Nasdaq Requirements
--------------------------------------------------------------
Pac-West Telecomm, Inc. (Nasdaq: PACW), a provider of integrated
communications services to service providers and small and medium-
sized enterprises in the western U.S., has received notification
from the Nasdaq Listing Qualifications Panel that the company has
regained compliance with all requirements for continued listing on
the Nasdaq SmallCap Market.

Therefore, the company has no plans at this time to exercise the
reverse split approved by its shareholders on June 9, 2003.

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

                            *  *  *

As reported in Troubled Company Reporter's May 1, 2003 edition,
Standard & Poor's Ratings Services lowered its corporate credit
rating on Pac-West Telecomm Inc. to 'D' from 'CC'. The rating on
the 13.5% senior notes due 2009 has been lowered to 'D' from
'C'.

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


PENN TRAFFIC: Arranges $270 Million Permanent DIP Financing
-----------------------------------------------------------
The Penn Traffic Company (OTC: PNFTQ.PK) closed a $270 million
permanent debtor-in-possession financing, which was approved on
July 31 by the U.S. Bankruptcy Court for the Southern District of
New York. Fleet Capital Corporation and a syndicate of lenders
that were lenders to the Company prior to the filing of its
chapter 11 petition is providing the $270 million senior secured
DIP financing facility.

"The Company is gratified by the strong support of our lenders as
evidenced by the closing of the DIP financing which we view as an
important vote of confidence in our Company, our people and our
potential," said Steven G. Panagos, Penn Traffic's interim Chief
Executive Officer. "I am looking forward to continuing to work
with all of our employees, vendors and other business partners to
strengthen Penn Traffic."

The Penn Traffic Company operates 211 supermarkets in Ohio, West
Virginia, Pennsylvania, upstate New York, Vermont and New
Hampshire under the "Big Bear," "Big Bear Plus," "Bi-Lo," "P&C"
and "Quality" trade names. Penn Traffic also operates a wholesale
food distribution business serving 76 licensed franchises and 53
independent operators.


PENN TREATY: Second Quarter Results Reflect Marked Improvement
--------------------------------------------------------------
Penn Treaty American Corporation (NYSE: PTA) (S&P, CCC-
Counterparty Credit Rating, Stable) reported 2nd quarter, 2003 net
income of $23,116,000 or $.32 per share on a fully diluted basis.
During the 2nd quarter of 2002, the Company reported net income of
$11,918,000 or $.57 per share on a fully diluted basis.
Outstanding shares used for the computation of fully diluted
earnings per share in 2003 reflect the potential conversion of the
Company's convertible subordinated notes due 2008, which were
issued after the 2nd quarter of 2002.

For the three months ended June 30, 2003, the Company's results
were significantly affected by the following pre-tax items (per
share amounts are net of tax and are on a fully diluted basis):

     1.   As a result of declining market interest rates during
          the second quarter, the Company recorded a gain on its
          notional experience account due from its reinsurer of
          approximately $39 million or $.34 per share.  In
          comparison, during the second quarter of 2002, the
          Company recorded a gain on its notional experience
          account of approximately $20 million or $.59 per share.

     2.   During the second quarter, the Company finalized a
          consulting agreement with and retirement package for
          Irving Levit, the Company's former chairman and CEO.  In
          addition, the Company has eliminated certain management
          positions, effective August 31, 2003. The Company has
          recognized all related compensation and severance
          associated with these events with a one-time charge of
          approximately $2.5 million or $.02 per share.  As a
          result, the Company expects annual savings of
          approximately $900,000.

     3.   During the second quarter of 2003, the Company took
          advantage of opportunities in the long-term care
          insurance marketplace that have enabled it to establish
          the sales and marketing infrastructure it believes is
          necessary to realize its goal of becoming an industry
          leader.  As a result, the Company has incurred
          additional expenses primarily related to the
          recommencement of new sales in certain key states, the
          development of its new sales and marketing management
          team, distribution of sales materials to agents and
          other product development costs.  In addition, one of
          the Company's agency subsidiaries expanded its regional
          office structure by investing in seasoned, established
          long-term care insurance distributors.  As a result of
          these investments, the Company incurred approximately
          $2.1 million of additional expense in the second quarter
          or $.02 per share.  The Company has experienced a 67%
          rise in new long-term care insurance policy applications
          submitted, rising from an average of 141 per week in the
          first quarter of 2003 to an average of 236 applications
          submitted per week for the last three weeks of July
          2003.

On June 30, 2003, the Company paid approximately $9.0 million to
retire all of its remaining outstanding convertible subordinated
notes due December 2003.  In addition, subsequent to June 30,
approximately $2.6 million of its convertible subordinated notes
due October 2008 were converted into shares of the Company's
common stock at a conversion price of $1.75.  The Company's book
value per share, or shareholders' equity divided by total
outstanding shares, taking into account the potential conversion
of all outstanding convertible subordinated notes, was $3.66 at
June 30, 2003.

The Company, through its wholly owned direct and indirect
subsidiaries, Penn Treaty Network America Insurance Company,
American Network Insurance Company, American Independent Network
Insurance Company of New York, United Insurance Group Agency,
Inc., Network Insurance Senior Health Division and Senior
Financial Consultants Company, is primarily engaged in the
underwriting, marketing and sale of individual and group accident
and health insurance products, principally covering long-term
nursing home and home health care.


PETROLEUM GEO: Seeking Okay to Sign-Up Willkie Farr as Attorneys
----------------------------------------------------------------
Petroleum Geo-Services ASA, seeks approval of the U.S. Bankruptcy
Court for the Southern District of New York to employ and retain
Willkie Farr & Gallagher as counsel.

As Counsel, the Debtor expects Willkie Farr to:

     a) perform all necessary services as the Debtor's counsel,
        including, without limitation, provide the Debtor with
        advice, represent the Debtor, and prepare all necessary
        documents on behalf of the Debtor, with respect to its
        bankruptcy proceedings and corporate reorganization;

     b) take all necessary actions to protect and preserve the
        Debtor's estate during the pendency of this chapter 11
        case, including the prosecution of actions by the
        Debtor, the defense of actions commenced against the
        Debtor, negotiations concerning litigation in which the
        Debtor is involved and the resolution of claims against
        the estate;

     c) prepare, on behalf of the Debtor, as debtor in
        possession, all necessary motions, applications,
        answers, orders, reports and papers in connection with
        the administration of this chapter 11 case;

     d) counsel the Debtor with regard to its rights and
        obligations as a debtor in possession; and

     e) perform all other necessary or requested legal services.

Matthew A. Feldman, a member of Willkie Farr & Gallagher reports
that their current standard hourly rates range from:

          attorneys           $225 to $735 per hour
          paralegals          $115 to $145 per hour

Petroleum Geo-Services ASA, headquartered in Lysaker, Norway is a
technology-based service provider that assists oil and gas
companies throughout the world.  The Company filed for chapter 11
protection on July 29, 2003 (Bankr. S.D.N.Y. Case No. 03-14786).
Matthew Allen Feldman, Esq., at Willkie Farr & Gallagher
represents the Debtor in its restructuring efforts.  As of May 31,
2003, the Debtor listed total assets of $3,686,621,000 and total
debts of $2,444,341,000.


PG&E NATIONAL: U.S. Trustee Appoints USGen Creditors' Committee
---------------------------------------------------------------
W. Clarkson McDow, Jr., the United States Trustee for Region 4,
appoints these entities to the Official Committee of Unsecured
Creditors for USGen New England, Inc.'s Chapter 11 case pursuant
to Section 1102 of the Bankruptcy Code:

      A. JPMorgan Chase Bank
         Attn: Agnes Levy
         270 Park Avenue, New York, NY 10017
         Phone: (212)270-0420   Fax: (917)464-8909;

      B. Algonquin Gas Transmission Company
         Attn: Richard Kruse
         5400 Westheimer Court, Houston, TX 77056
         Phone: (713)627-5968   Fax: (713)627-4027;

      C. Banc of America, SSI
         Attn: Therese Fontaine
         555 S. Flower Street, 9th Floor, Los Angeles, CA 90072
         Mail Code: CA9-706-09-37
         Phone: (213) 345-1291   Fax: (213) 345-1284;

      D. DZ Bank AG (New York Branch)
         Attn: William Klun
         609 5th Avenue, New York, NY 10017-1021
         Phone: (212) 745-1400   Fax: (212) 745-1556;

      E. Covanta Haverhill
         Attn: C. Thomas Rantaj
         100 Recovery Way, Haverhill, MA 01835
         Phone: (978) 372-6288   Fax: (978) 521-1359;

      F. HSBC Bank, USA, as Indenture Trustee
         Corporate Trust Services
         Attn: Robert A. Conrad
         452 Fifth Avenue, New York, NY 10018-2706
         Phone: (212) 525-1314, (212) 525-1366;

      G. Mohawk River Funding, III LLC.
         Attn: Don V. Fishbeck
         1001 Louisiana, Houston, TX 77002
         (713) 420-3330   Fax (713) 420-5317;

         and

      H. John E. Lucian, Esq.
         Blank Rome, LLP
         250 West Pratt Street, Suite 2201, Baltimore, MD 21201
(PG&E National Bankruptcy News, Issue No. 3; Bankruptcy Creditors'
Service, Inc., 609/392-0900)


PILLOWTEX CORP: Wants More Time to File Schedules and Statements
----------------------------------------------------------------
Pillowtex Corporation and its debtor-affiliates are large and
complex enterprises with operations throughout the United States
that own and operate manufacturing and distribution facilities and
a number of retail outlet stores that sell certain products
directly to consumers.  As of July 25, 2003, the Pillowtex
Companies employed approximately 7,750 full-time and part-time
employees.  However, on July 30, 2003, the Debtors terminated
approximately 6,550 of their salaried and hourly employees and
began winding down their operations.

Donna L. Harris, Esq., at Morris, Nichols, Arsht & Tunnell, in
Wilmington, Delaware, notes that pursuant to Local Bankruptcy
Rules 1007-1(b) and (c), the Debtors have to file their schedules
of assets and liabilities, a schedule of current income and
expenditures, a schedule of executory contracts and unexpired
leases and a statement of financial affairs within 30 days from
the Petition Date.  However, Ms. Harris informs Judge Walsh that
the Debtors were unable to complete the Schedules and Statements
prior to the Petition Date and will not be in a position to
complete the Schedules and Statements on time because:

    (a) the completion of the Schedules and Statements will
        require the Debtors to compile information regarding more
        than 6,000 vendors, 7,750 current and former employees
        and thousands of other potential creditors;

    (b) completing the Schedules and Statements for each of the
        16 Debtors will require the collection, review and
        assembly of information from numerous locations
        throughout the United States;

    (c) the computer-based and other information systems from
        which the Debtors must cull the information necessary to
        prepare the Schedules and Statements are not completely
        centralized or integrated among all of the Debtors and
        are not currently configured and designed in a way that
        would allow the Debtors to cull the necessary information
        quickly and efficiently; and

    (d) as a result of adverse market conditions, reduced cash
        flows and disappointing results from operations, the
        Debtors were forced to reduce their accounting personnel,
        and therefore have a limited accounting staff available.

Accordingly, the Debtors ask the Court to extend the time for
them to file the Schedules and Statements for an additional 60
days, for a total of 90 days from the Petition Date. (Pillowtex
Bankruptcy News, Issue No. 47; Bankruptcy Creditors' Service,
Inc., 609/392-0900)


PINNACLE FOODS: S&P Keeps Watch after Acquisition Announcement
--------------------------------------------------------------
Standard & Poor's Ratings Services placed its 'BB-' corporate
credit rating on pickle and frozen food producer Pinnacle Foods
Corp. on CreditWatch with negative implications. At the same time,
Pinnacle's 'BB-' senior secured rating was affirmed.

The CreditWatch listing follows the announcement that Hicks, Muse,
Tate & Furst Incorporated has signed a definitive agreement under
which private equity firm JPMorgan Partners, in partnership with
C. Dean Metropoulos, will acquire Pinnacle Foods for $485 million.
(JPMorgan Partners is the private equity arm of J.P. Morgan Chase
& Co Inc.)

Standard & Poor's expects that, upon completion of the proposed
transaction, Pinnacle Foods' senior secured debt will be repaid
and subsequently withdrawn.

"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 Ronald Neysmith.

Standard & Poor's will review the proposed transaction and its
effect on the company's credit quality before taking further
rating action.

Cherry Hill, New Jersey-based Pinnacle Foods Corp. is the
manufacturer and marketer of Swanson frozen foods, Vlasic pickles
and condiments, and Open Pit barbeque sauce.


QUAIL PIPING: Wants Approval for Asset Sale Bidding Procedures
--------------------------------------------------------------
Quail Piping Products, Inc., asks the U.S. Bankruptcy Court for
the Northern District of Texas' to approve proposed Bidding
Procedures in connection with its proposed asset sale as
previously reported in the Troubled Company Reporter's July 23
edition.

To ensure that the estate receives the highest and best offer for
the Assets, the Debtor will solicit competing bids for the Assets.
Under the bidding procedures, only Qualified Bidders may submit
overbids for the Assets, or otherwise participate in the Auction.

In order to be deemed a Qualified Bidder, each Potential Bidder:

     (i) must deliver to the Debtor an executed APA, marked to
         show those amendments and modifications to the APA
         entered into with the Buyer including, but not limited
         to, the price;

    (ii) must deliver to the Debtor a deposit in the form of
         certified check made payable to the Debtor in the
         amount of $500,000; and

    (iv) must comply with the other related requirements.

If the Debtor receives a Qualified Bid, the Debtor will conduct an
auction at the location designated by Debtor at least 3 Business
Days prior to the Auction, on the date that is 1 Business Day
prior to the date scheduled by the Bankruptcy Court for the Sale
Hearing.

All overbids must be submitted to:

          Quail Piping Products, Inc.
          4245 Kemp Blvd.
          Suite 810, Wichita Falls
          Texas 76308
          Attn: the President; and

          the Debtor's counsel,
          Gadsby Hannah LLP
          225 Franklin Street
          Boston, Massachusetts 02110
          Charles A. Dale, III, Esq.,

so as to be received not later than 11:00 a.m., 5 Business Days
prior to the Court-scheduled Sale Hearing, which may change from
time to time.

The opening bid is the highest Qualified Bid submitted before the
Auction by a Qualified Bidder, which must include:

     (a) the Break-up Fee; and

     (b) an incremental increase in the Purchase Price of not
         less than $200,000.

Bidding at the Auction will continue until such time as the
highest and best Qualified Bid is determined. Debtor may announce
at or prior to the Auction additional procedural rules that are
reasonable under the circumstances.

If, for any reason, the Successful Bidder fails to consummate the
purchase, the Bidder making the second highest and best bid will
automatically be deemed to have submitted the Successful Bid,
without further Order of the Bankruptcy Court, and the Debtor may
close with that Bidder.

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.


RCN CORP: June 30 Net Capital Deficit Widens to $2.4 Billion
------------------------------------------------------------
RCN Corporation (Nasdaq: RCNC) reported its results for the
quarter ended June 30, 2003.

Revenues for the quarter were $121.6 million, a 6.5% increase from
$114.3 million a year ago.  RCN reported a net loss to common
shareholders of $126.4 million, or $1.15 loss per average common
share, compared to a loss of $202.1 million, or $1.93 loss per
average common share in the second quarter of 2002, before an
impairment charge of $892.3 million taken in that quarter.
Including the impairment charge, RCN's second quarter 2002 loss
was $1,094.4 million, or $10.46 loss per average common share.

RCN is a 50/50 partner in Starpower, a joint venture serving the
Washington, D.C. metropolitan area.  Starpower's results are not
included in RCN's financial statements prepared in accordance with
generally accepted accounting principles.  RCN management
evaluates the financial and operational performance of the Company
based on results that include Starpower.  Including Starpower's
results, revenues for the quarter ended June 30, 2003 were $142.1
million, a 5.2% increase from $135.1 million in the second quarter
of 2002.  Including Starpower, consolidated adjusted EBITDA was
$8.7 million, compared to a loss of $21.2 million in the second
quarter of 2002.  The current quarter's results include an
adjustment for a plan amendment resulting in a non-recurring, $6.2
million decrease in compensation expense.

"The company delivered another good quarter of progress and
introduced a number of new products that will continue to drive
our average revenue and services per customer," said David C.
McCourt, RCN's Chairman and CEO.

Including Starpower, RCN finished the quarter with 1,419,947
marketable homes, with 462,953 customers on its network, of which
175,343, or 37.8%, were taking one of the ResiLink(SM) bundles.
ResiLink customers ended the quarter with an average of 3.3
services including long distance, and $135 in monthly revenue.
Overall customer churn during the quarter was 2.5%.

               Liquidity Update as of June 30, 2003

Cash burn for the quarter was $83.6 million, including $45.3
million for debt service expenses and fees.  Capital expenditures
totaled $25.9 million for the quarter, and $49.6 year to date.
Cash outlays for capital expenditures were down 37% from the same
quarter last year.  The Company had $357.8 million of cash and
short-term investments, which includes $139.8 million of short-
term restricted investments and $100 million of long-term
restricted investments.  The long-term restricted cash investment
relates to the company's requirement to maintain at least $100
million in a cash collateral account for the benefit of its senior
secured lenders.  The Company had $1.73 billion of outstanding
debt at the end of the quarter.

At June 30, 2003, the Company's balance sheet shows a total
shareholders' equity deficit of about $2.4 billion.

                        Other Developments

New Second Lien Facility - RCN announced that it entered into a
new senior secured, second lien credit facility with Evergreen
Investments.  Evergreen provided a commitment of $41.5 million,
with the net proceeds to be used directly or indirectly to retire
outstanding Senior Notes.  Per the agreement, this commitment
expires on September 4, 2003.

Cable System Sale - After the end of the quarter, RCN entered into
a definitive agreement to sell its Carmel, NY cable system assets
and customers for approximately $120 million in cash to
Susquehanna Communications.  The system serves approximately
29,800 customers.  The transaction, valued at approximately $4,027
per video subscriber, is expected to close in the first quarter of
2004.

Modified Dutch Tender Offer - On July 11, 2003, RCN commenced a
tender offer to purchase up to $290 million face value.  As of
5:00 p.m. August 7, 2003, the principal amount of Notes tendered
was approximately $40.7 million. On August 8th, the Company
extended its tender offer from 11:59 p.m., New York City time on
August 7, 2003 to 5:00 p.m., New York City time, on August 15,
2003.

New Products Launched in the Second Quarter - RCN rolled out video
on demand in Boston, Manhattan (including Queens and Brooklyn),
and the Lehigh Valley.  The Company launched HDTV in Boston,
Washington, D.C., the Lehigh Valley and Manhattan.  Additionally,
RCN rolled out home networking in Boston and MegaModem in
Manhattan.  Some of these products were launched in other markets
prior to the second quarter.

RCN Corporation (Nasdaq: RCNC) is the nation's first and largest
facilities-based competitive provider of bundled phone, cable and
high speed Internet services delivered over its own fiber-optic
local network to consumers in the most densely populated markets
in the U.S.  RCN has more than one million customer connections
and provides service in the Boston, New York, Philadelphia/Lehigh
Valley, Chicago, San Francisco, Los Angeles and Washington, D.C.
metropolitan markets.


RESOURCE AMERICA: June 2003 Quarter Results Show Strong Growth
--------------------------------------------------------------
Resource America, Inc. (NASDAQ:REXI) reported net income of $3.5
million and $8.4 million for the third fiscal quarter and nine
months ended June 30, 2003 as compared to net income of $6,000 and
$5.3 million for the third fiscal quarter and nine months ended
June 30, 2002, an increase of $3.5 million and $3.0 million,
respectively.

Net income per common share diluted was $.20 and $.48 per common
share for the third fiscal quarter and nine months ended June 30,
2003 as compared to net income per common share diluted of $.00
and $.30 per common share for the third fiscal quarter and nine
months ended June 30, 2002, an increase of $.20 and $.18,
respectively. Earnings before interest, taxes, depreciation,
depletion and amortization (EBITDDA) was $11.4 million for the
third fiscal quarter ended June 30, 2003 as compared to $7.7
million for the third fiscal quarter ended June 30, 2002, an
increase of $3.7 million (48%).

Highlights for the Third Fiscal Quarter Ended June 30, 2003 and
Recent Developments

-- The Company increased its managed assets to $2.1 billion at
   June 30, 2003 from $1.8 billion at March 31, 2003, an increase
   of 22%.

-- The Company executed a definitive agreement to recapitalize its
   investment in the Evening Star building. After expenses of the
   transaction, the Company expects to receive proceeds of
   approximately $27.0 million and retain a 20% investment in the
   building.

-- The Company entered into a Letter of Intent to recapitalize its
   investment in the National Press Building, a 478,000 square
   foot, landmark office and retail building located in
   Washington, DC. After expenses, the Company expects to receive
   proceeds of approximately $21.0 million and retain a 20%
   investment in the building.

-- Natural gas revenues were $9.0 million in the third fiscal
   quarter ended June 30, 2003, as compared to $6.4 million in the
   third fiscal quarter ended June 30, 2002, an increase of $2.6
   million (41%).

-- Atlas Pipeline Partners, L.P., (AMEX:APL) a publicly traded
   natural gas pipeline limited partnership of which the Company
   is the general partner and principal owner, completed a public
   offering of 1,092,500 common units of limited partner interest.
   The net proceeds after underwriting discounts and commissions
   were approximately $25.3 million.

-- Trapeza closed its third Collateralized Debt Obligation secured
   by $300.0 million of trust preferred securities bringing total
   issuance of such pools to $1.0 billion.

-- The Company repurchased 123,500 shares of its common stock at
   an average price of $9.56 at a range of $8.20 to $11.02 from
   April 1, 2003 through August 8, 2003.

-- The Company repurchased an additional $11.3 million (face
   amount) of its 12% Senior Notes due 2004 subsequent to June 30,
   2003. After this repurchase the Company has $54.0 million
   outstanding of the $115.0 million originally issued in July
   1997.

-- The Company received $4.9 million in satisfaction of its
   mortgage loans secured by a property in Pittsburgh, PA.

-- The Company extended the maturities of its secured lines of
   credit with Sovereign Bank. The two facilities, totaling $23.0
   million, have been extended to August 2005.

-- The Company extended the maturity of its $5 million secured
   line of credit with Commerce Bank to May 2005.

Resource America, Inc. (S&P/B/Negative) is a proprietary asset
management company that uses industry specific expertise to
generate and administer investment opportunities for its own
account and for outside investors in energy, real estate and
financial services. For additional information visit
http://www.resourceamerica.com


REXNORD CORP: First Quarter Results Swing-Down to $2.5M Net Loss
----------------------------------------------------------------
Rexnord Corporation, a leading manufacturer of highly engineered
mechanical power transmission components, reported its summary
results for the first quarter of its fiscal year 2004.

Net sales for the first quarter ended June 29, 2003 were $161.8
million, a decrease of 6.6% compared to $173.3 million in the
first quarter of the prior year. A net loss of $2.5 million was
reported in the quarter compared to net income of $5.5 million in
last year's first quarter. Sales in the quarter were favorably
impacted by 5% from changes in currency exchange rates, primarily
related to the Euro.

Weak business conditions in the quarter, particularly in the
manufacturing sector in both North America and Europe, resulted in
lower demand for the Company's products as compared to the first
quarter of fiscal 2003. Additionally, these weak business
conditions caused several North American industrial distributors
to reduce their inventory levels, which resulted in reduced sales
to those distributors in the first quarter.

Sales of the Company's aerospace products declined 12% in the
quarter as compared to the prior year's first quarter due to the
continued contraction in the commercial airframe industry while
industrial chain sales also declined 12% due the Company's
decision to discontinue the manufacture of unprofitable products
as well as the continued softness in end markets of construction,
forest products, agriculture and cement. Bearing and flattop sales
declined 7% in the quarter due to inventory reduction activity by
North American industrial distributors and lower capital spending
by end users. Partially offsetting these factors were increased
sales related to specific growth initiatives in place for both
bearing and flattop products. Gear, coupling and special
components sales were down approximately 1% in the quarter as
compared to the same quarter last year.

Given the weaker economic conditions, the Company accelerated its
efforts to reduce its operating costs. These cost control measures
include lower material costs achieved through improved purchasing
techniques and component outsourcing, lower overtime costs, strict
cost controls on discretionary spending, shorter work weeks at
specific locations, and headcount reductions.

Gross profit margin in the first quarter was 29.7% as compared to
32.3% in last year's first quarter. The margin decline was largely
the result of lower sales on a currency-adjusted basis in the
quarter. Selling, general and administrative expenses declined by
$2.7 million, or 7% in the quarter to $36.1 million from $38.8
million last year; however, current year first quarter SG&A
expenses are affected by an increase of $2.2 million due to
changes in currency exchange rates. Using constant currency rates,
SG&A expenses declined by $4.9 million, or 12.6% in the quarter as
compared to the first quarter last year.

Income from operations for the first quarter of fiscal year 2004
was $7.8 million compared to $14.0 million reported in the first
quarter of fiscal 2003. The decline in income from operations is
primarily due to lower sales in the quarter and an increase of
$3.1 million in amortization expense of intangible assets recorded
in the acquisition of Rexnord. Interest expense increased by $6.3
million to a total of $11.4 million for the current quarter as
compared to $5.1 million in last year's first quarter due to
higher debt balances incurred in the acquisition of the Rexnord
Group on November 25, 2002. As a result of the above, a net loss
of $2.5 million was reported in the quarter compared to net income
of $5.5 million in last year's first quarter.

At June 29, 2003, total debt was essentially unchanged from
March 31, 2003 at $580.6 million and cash and cash equivalents was
$25.6 million.

"The difficult economic environment worsened during the June
quarter which caused our larger industrial distributors to make
sizeable reductions in the amount of inventory carried on their
shelves. While this had a negative impact on our sales in the
quarter accounting for about half of the sales shortfall as
compared to last year's first quarter, these reductions will have
a stimulating impact upon a recovery in the manufacturing sector.
We are taking advantage of this period to lower our overall
operating cost structure and improve processes that will leave us
well positioned for an economic recovery." said Bob Hitt,
Rexnord's CEO. "While the cost reduction activity is a major
focus, we are also concentrating on growth initiatives including
the introduction of new products in those product lines with
higher growth potential. We have also made progress in
implementing the operational excellence initiatives known as the
Rexnord Business System. For the balance of calendar year 2003, we
expect the difficult economic environment will continue, and we
will remain focused on free cash flow generation for the purpose
of paying down our debt before it is due, building upon our market
leading positions, and executing RBS to drive reductions in
operating costs."

Adjusted EBITDA for the first quarter ended June 29, 2003 was
$19.9 million compared to $26.4 million reported in the first
quarter ended June 30, 2002.

Headquartered in Milwaukee, Wisconsin, Rexnord is a leading
worldwide manufacturer of mechanical power transmission
components. The company has over 4,900 employees located at more
than 30 manufacturing facilities worldwide. Rexnord products are
sold around the world by over 200 direct sales representatives
through a network of multiple service centers and warehouses
backed by hundreds of independent stocking distributors. For more
information, visit http://www.rexnord.com

                      Conference Call Details

Rexnord will discuss its first quarter results on a conference
call tomorrow at 10:00 a.m. EDT. The call will be conducted by
Thomas J. Jansen, CFO and Michael N. Andrzejewski, VP Business
Development. The conference call can be accessed via telephone as
follows:

          Domestic toll-free # 1-800-915-4836
          International toll # 1-973-317-5319

Lines will be muted until Rexnord completes its comments on the
results. Thereafter, a question and answer session will commence.

This conference call will be recorded with a replay period of one
week.

     Replay domestic toll-free # 1-800-428-6051
          (through August 21, 2003)
     Replay international toll # 1-973-709-2089
     Replay access code 303290

                         *     *     *

As previously reported in Troubled Company Reporter, Moody's
Investors Service assigned initial ratings to Rexnord Corporation.
Outlook is stable.

                     Assigned Ratings:

      * B3 - proposed $225 million of senior subordinated
        notes, due 2012,

      * B1 - proposed $75 million senior secured revolving
        credit facility, due 2008,

      * B1 - proposed $360 million senior secured term
        loan, due 2009,

      * B1 - senior implied rating, and

      * B2 - issuer rating

The initial ratings reflect Moody's concerns on its highly
cyclical end-markets, fluctuating financial performance, slow cash
flow and the challenges Rexnord encounters in its economic
environment. However those issues are offset by the company's
strong market position, and the strong potential for a good
financial performance in the near future.


RIVIERA HOLDINGS: S&P Ratchets Credit Rating Down a Notch to B
--------------------------------------------------------------
Standard & Poor's Ratings Services lowered its corporate credit
and senior secured debt ratings for Riviera Holdings Corporation
to 'B' from 'B+'.

Las Vegas, Nevada-headquartered Riviera Holdings owns and operates
the Riviera Hotel and Casino in Las Vegas and the Riviera Casino
in Black Hawk, Colorado. The outlook is stable. Total debt
outstanding as of June 30, 2003, was $218.6 million.

"The downgrade stems from a prolonged period of weak credit
measures, and the expectation that these credit measures will not
improve meaningfully in the near term," said Standard & Poor's
credit analyst Peggy Hwan. For the most recent quarter ended June
30, 2003, consolidated EBITDA declined 15.6% on year-over-year
basis due to a decrease in gaming revenues at both the Las Vegas
and Black Hawk properties. As a result, debt leverage and EBITDA
coverage of interest expense weakened to 6.7x and 1.2x,
respectively, at June 30, 2003. Given operating trends, Standard &
Poor's does not expect credit measures to materially improve
during the next several quarters.

Ratings reflect Riviera's high debt leverage and small portfolio
of two casinos with the larger being an older property that is
located well north along the Las Vegas Strip.


SAFETY-KLEEN: Posts Reorganized Value Estimated by Lazard Freres
----------------------------------------------------------------
D. J. Baker, Esq., at Skadden Arps, in New York, tells Judge Walsh
that the Safety-Kleen Debtors and their professionals have been
advised by Lazard, their financial advisor, with respect to the
reorganization value of the Reorganized Debtors on a going concern
basis.  Solely for the purposes of the Plan, the estimated range
of reorganization values of the Reorganized Debtors is estimated
at approximately $460 million to $640 million -- with a midpoint
value of $550 million -- as of September 1, 2003, the assumed
Effective Date.

The assumed range of the reorganized value as of the assumed
Effective Date reflects work performed by Lazard on the basis of
information regarding the Debtors' business and assets available
to Lazard as of June 2003.  Lazard has revised the discounted cash
flow analysis to reflect the most recent company projections.

Mr. Baker advises that, upon emergence from Chapter 11, Safety-
Kleen and Holdco expect that the amount of debt drawn under the
Exit Facility will be $115 million, assuming a $100 million net
cash Laidlaw Recovery, and full payment of administrative claims
and the Pinewood Settlement.  Based on the assumed range of the
reorganization value of the Reorganized Debtors of $460 million to
$640 million, and long term debt -- net of excess cash -- of $250
million, including $125 million of New Notes and $10 million of
Preferred Stock, the Reorganized Debtors have an equity value
range of $210 million to $390 million, with a midpoint value of
$300 million.

Assuming a distribution of 25 million shares of the New Common
Stock pursuant to the Plan, the estimated range of equity value of
the New Common Stock is between $8.40 and $15.60 per share with a
midpoint value of $12 per share.  Mr. Baker emphasizes that this
estimated range of values is hypothetical and reflects the
estimated intrinsic value of the Reorganized Debtors derived
through the application of various valuation techniques. (Safety-
Kleen Bankruptcy News, Issue No. 62; Bankruptcy Creditors'
Service, Inc., 609/392-0900)


SAMUELS JEWELERS: US Trustee to Meet with Creditors on Sept. 12
---------------------------------------------------------------
The United States Trustee for Region III will convene a meeting of
Samuels Jewelers, Inc.'s creditors on September 12, 2003, 10:00
p.m., at the J. Calebs Boggs Federal Building, 2nd Floor, Room
2112, in Wilmington, Delaware.  This is the first meeting of
creditors required under 11 U.S.C. Sec. 341(a) in all bankruptcy
cases.

All creditors are invited, but not required, to attend. This
Meeting of Creditors offers the one opportunity in a bankruptcy
proceeding for creditors to question a responsible office of the
Debtor under oath about the company's financial affairs and
operations that would be of interest to the general body of
creditors.

Samuels Jewelers, Inc., headquartered in Austin, Texas, operates a
national chain of specialty retail jewelry stores located in
regional shopping malls, power centers, strip centers and stand-
alone stores. The Company filed for chapter 11 protection on
August 4, 2003 (Bankr. Del. Case No. 03-12399). Scott D. Cousins,
Esq., William E. Chipman Jr., and Victoria W. Counihan, Esq., at
Greenberg Traurig LLP, represent the Debtor in its restructuring
efforts.  When the Company filed for protection from its
creditors, it listed $42,500,000 in total assets and $78,400,000
in total debts.


SBA COMMS: Red Ink Continued to Flow in Second Quarter 2003
-----------------------------------------------------------
SBA Communications Corporation (Nasdaq: SBAC) reported results for
the second quarter ended June 30, 2003. Highlights of the results
include:

* Sequential growth in leasing revenue, tower cash flow, tower
  cash flow margin, Adjusted EBITDA and Adjusted EBITDA margin

* Leasing revenue and tower cash flow grew 12% and 13%,
  respectively, year over year

* Asset sale proceeds to date of $181.5 million

* Repurchased to date $45 million of 12% Senior Discount Notes

                         Operating Results

Total revenues in the second quarter of 2003 were $50.4 million,
compared to $63.6 million in the year earlier period. Site leasing
revenue of $31.7 million and site leasing gross profit (tower cash
flow) of $21.1 million were up 12.3% and 12.8%, respectively, over
the year earlier period, which percentage increases approximate
the same tower revenue and tower cash flow growth on the 3,037
towers owned at June 30, 2002 and 2003. Site leasing gross profit
margin in the second quarter was 66.6%, a 120 basis point
sequential improvement over the first quarter of 2003. Site
leasing contributed 92.4% of the Company's gross profit in the
second quarter. Site development revenues were $18.7 million
compared to $35.4 million in the year earlier period. Selling,
general and administrative expenses were $7.2 million in the
second quarter, as compared to $8.7 million in the year earlier
period, a 17% reduction, and compared to $8.5 million in the first
quarter of 2003.

Net loss from continuing operations before cumulative effect of a
change in accounting principle for the second quarter was $45.4
million or $.89 per share, compared to $46.5 million or $.92 per
share in the year earlier period. Excluding non-cash asset
impairment charges of $10.3 million and $13.4 million, net loss
per share for the second quarters of 2003 and 2002 was $.69 and
$.65, respectively. Net loss in the second quarter of 2003 was
$56.4 million. Net loss per share was $1.10 for the second quarter
of 2003 compared to $.94 in the year earlier period. Excluding the
non-cash asset impairment charges of $10.3 million and $13.4
million, net loss per share for the second quarter of 2003 and
2002 was $.90 and $.67, respectively.

Net cash used in operating activities for the second quarter of
2003 was $2.8 million, compared to $4.8 million in the first
quarter of 2003. Adjusted EBITDA was $15.9 million, compared to
$15.1 million in the first quarter of 2003 and $17.3 million in
the year earlier period. Adjusted EBITDA margin improved to 31.6%,
a 440 basis point improvement over the year earlier period and a
230 basis point improvement over the first quarter of 2003.

As a result of the Company's sale of 801 towers in its western
region, the majority of which was completed in the second quarter,
the results of all 801 towers are reflected as discontinued
operations in accordance with generally accepted accounting
principles for the three and six month periods ended June 30, 2003
and the comparable periods of 2002. In addition, the Company has
decided to sell an additional 51 towers located in its western
region, the results of which are also reflected as discontinued
operations for the same periods. Accordingly, site leasing
revenue, site leasing gross profit and SG&A expense were reduced
by $3.9 million, $2.5 million and $0.2 million for the three
months ended June 30, 2003 and by $6.0 million, $3.8 million and
$0.3 million for the year earlier period.

                      Investing Activities

SBA built 4 towers and sold or otherwise disposed of 637 towers,
ending the quarter with 3,243 towers. SBA received approximately
$145 million of gross cash proceeds from tower sales in the second
quarter. Subsequent to quarter-end, SBA has received an additional
approximately $36.5 million of gross cash proceeds in exchange for
the sale of 98 towers. The last 72 towers of the 801 tower sale
are expected to be transferred on or before October 1, 2003 in
exchange for gross proceeds of approximately $21.5 million,
subject to certain purchase price adjustments. The Company also
commenced efforts to sell 51 towers that were remaining in its
western region after the 801 tower sale, to further improve
efficiencies in its tower portfolio. These 51 towers have been
classified as assets held for sale. The Company recognized a non-
cash asset impairment charge of $4.0 million in connection with
its decision to sell these 51 towers, which charge has been
reflected as a loss from discontinued operations in the second
quarter. Giving effect to the sale of all 801 towers and the
intended sale of the 51 additional towers, at June 30, 2003 pro
forma tower count was 3,022 towers. Capital expenditures for the
second quarter were $3.0 million, down from $6.1 million in the
first quarter of 2003 and $23.8 million in the year earlier
period.

                       Financing Activities

In the second quarter SBA refinanced its prior senior credit
facility with the proceeds of a new $195 million senior credit
facility, cash on hand and a portion of the proceeds from the
tower sale. In connection with the refinancing, the Company wrote
off deferred financing fees of $4.4 million. SBA ended the quarter
with $145.7 million borrowed under its $195 million senior credit
facility, $744 million of senior notes outstanding and net debt of
$844.7 million. Total debt has declined from $1.019 billion at
December 31, 2002 to $889.8 million at June 30, 2003. In the
second quarter, SBA repurchased $25 million in principal amount of
its 12% Senior Discount Notes and subsequent to quarter-end has
repurchased an additional $20 million in principal amount of such
notes. The Company purchased the notes in the open market and paid
cash of approximately par, or $45 million, plus accrued interest.
Liquidity at June 30, 2003 was $95 million, consisting of $45
million of cash and restricted cash, and $50 million of
availability under the new credit facility. Such liquidity does
not include any asset sale proceeds received and to be received,
or note repurchases, subsequent to June 30, 2003.

"We were very active in the second quarter, and pleased with the
results," commented Jeffrey A. Stoops, President and Chief
Executive Officer. "We made great progress in stabilizing our
balance sheet, liquidity and operations, and positioning the
Company for future growth. Through the tower sale and senior
credit facility refinancing we reduced total debt and improved our
liquidity position materially. Our balance sheet focus has now
turned to reducing our interest expense and deleveraging the
Company, and we were able to make progress on those goals through
repurchasing some of our higher-cost debt. Operationally, our
tower ownership business is performing well. We experienced solid
growth in tower leasing revenue, tower cash flow and tower cash
flow margin on a sequential basis. On the cost side, we continued
to reduce overhead expense and capital expenditures.

"While we remain cautious, the business environment appears to be
improving. Carrier activity and demand for both our tower space
and our services business picked up in the second quarter, and we
are expecting a stronger second half of the year. We have
increased our outlook for 2003 for our leasing business, and feel
that the services business has stabilized and will improve through
the remainder of 2003. We believe that we will have good momentum
carrying into 2004. We continue to be very excited about, and
confident in attaining, our goals of growth in tower cash flow and
Adjusted EBITDA, reducing leverage and attaining positive free
cash flow."

                              Outlook

In July 2003, SBA was awarded a network development contract from
Sprint Spectrum L.P., which the Company estimates will produce $70
to $90 million in site development revenue over the next 24
months, substantially all of which will be earned in 2004 and
2005.

The Company has provided its Third Quarter 2003 and Full Year 2003
Outlook. This outlook is based on current expectations and
assumptions and reflects the intended sale of 852 towers as
discontinued operations in the third quarter and for the full
year. Information regarding potential risks that could cause the
actual results to differ from these forward-looking statements are
set forth below and in the Company's filings with the Securities
and Exchange Commission.

SBA is a leading independent owner and operator of wireless
communications infrastructure in the United States. SBA generates
revenue from two primary businesses -- site leasing and site
development services. The primary focus of the Company is the
leasing of antenna space on its multi-tenant towers to a variety
of wireless service providers under long-term lease contracts.
Since it was founded in 1989, SBA has participated in the
development of over 20,000 antenna sites in the United States.

                         *     *     *

As reported in Troubled Company Reporter's June 16, 2003 edition,
Standard & Poor's Ratings Services affirmed its 'CCC' corporate
credit rating on SBA Communications Corp. and removed the rating
from CreditWatch. The outlook is developing.

The ratings were originally placed on CreditWatch with negative
implications in late 2002 because of concerns that the company
might violate tight covenants under its bank facility in 2003 and
possibly require a financial restructuring. SBA Communications,
however, has recently closed on the sale of 679 towers for about
$160 million in gross cash proceeds and expects to sell another
122 towers for about $43 million around October 2003. The proceeds
from the first tower sale, in addition to borrowings from a new
credit facility, have allowed the company to refinance the bank
facility and have reduced the likelihood that the company will
restructure in the near term.


SLATER STEEL: Realigning Stainless Bar Operations Due to Losses
---------------------------------------------------------------
Slater Steel Inc., expects to report a net loss in the range of
$44 to $50 million for the three months ended June 30, 2003. The
loss is primarily related to the stainless steel segment. The
Company's actual second quarter financial results will be released
on or before August 27, 2003.

The second quarter financial results were negatively impacted by
several factors, including restructuring and financing related
fees and expenses; the ongoing weak demand for stainless steel bar
products and soft product pricing; and high input costs (including
natural gas, nickel, scrap and electricity). In addition, the last
two factors gave rise to a significant provision for inventories
in the stainless steel segment which have manufactured costs in
excess of net realizable values.

The Company stated that it remains in compliance with the terms of
its debtor-in-possession facility. Further comments on Slater's
performance will be provided when second quarter financial results
are released. No additional disclosure or commentary will be made
until that time.

                       Restructuring Update

As a result of the sizeable losses incurred in the first half of
the year, liquidity constraints and the challenging outlook for
the stainless bar market, Slater is announcing a significant
restructuring of its stainless bar operations.

The stainless steel bar market has been negatively impacted by
weak demand, particularly in the capital goods sector. High import
penetration levels and aggressive competition for market share
have contributed to a steep erosion in stainless bar selling
prices in the first half of 2003. For some stainless bar products,
the sharp decline in selling prices accelerated in the second
quarter. At the same time, input costs have been rising steadily.

To improve the economics of its stainless bar business, the
Company will downsize its stainless bar operations to what it
believes is a competitively -- and financially -- viable market
position. To protect its core business, the Company will
concentrate sales and production on 2.5" to 8" diameter rounds on
an interim basis. As a result of this initiative, a number of
assets will be temporarily shutdown.

Several operations will be temporarily shutdown at Fort Wayne
Specialty Alloys in Fort Wayne, Indiana, which will likely impact
over 200 hourly and salaried positions at this facility. The
entire Atlas Specialty Steels' facility, in Welland, Ontario, will
be temporarily shutdown. During the shutdown, feedstock will be
sourced from third parties. Approximately 630 hourly and salaried
positions will be affected by the Atlas Specialty Steels'
shutdown.

The Company said that while the exact timing of the various
shutdowns will be finalized over the coming weeks, it expects that
they will be implemented over the third and fourth quarter of
2003. The duration of the shutdowns is contingent on the
restructuring process.

"Given stainless bar market realities, immediate changes are
critical to Slater's restructuring process," said Paul A. Kelly,
president and chief executive officer, Slater Steel Inc. "We very
much regret the effect these shutdowns will have on employees,
their families and the communities in which we operate. The
Company, however, simply does not have the liquidity to support
the magnitude of losses that the stainless bar operations are
experiencing."

The Company said that it would endeavor to mitigate the impact
that the stainless bar realignment will have on its customers.

Slater also said that it has begun discussions with its respective
unions on reducing labor costs, another element of the
restructuring.

The Company stated that there can be no assurance that there will
be any recovery for existing shareholders as the restructuring
process progresses. As disclosed previously, RBC Capital Markets
has been retained to investigate all strategic options available
to Slater. This includes canvassing the market for equity
investors, exploring other financing alternatives and/or the
possible sale of certain assets, operating divisions, or the
Company in its entirety.

Slater Steel is a mini mill producer of specialty steel products.
The Company's mini mills are located in Fort Wayne, Indiana,
Lemont, Illinois, Hamilton and Welland, Ontario and Sorel-Tracy,
Quebec.

Slater Steel filed for creditor protection in Canada and the
United States on June 2, 2003, (Bankr. Del. Case No. 03-11639). At
that time, the Company stated that the filings would allow it to
develop a restructuring plan to address its debt, capital and cost
structures.


SMTC CORP: June 29, 2003 Balance Sheet Upside-Down by $22 Mill.
---------------------------------------------------------------
SMTC Corporation (Nasdaq: SMTX, TSE: SMX), a global provider of
electronics manufacturing services to the technology industry,
today reported second quarter revenue of $74.5 million, compared
to $161.6 million for the same quarter last year and a net loss on
a Generally Accepted Accounting Principles basis of $39.9 million,
or $1.39 per share compared to a net loss of $1.8 million, or
$0.06 per share for the same quarter last year. The 2003 net loss
includes an additional valuation allowance of $34.2 million
related to deferred tax assets, which has the effect of reducing
the recorded value to zero. The Company also recorded net
restructuring and other charges of $2.9 million. There were no
restructuring and other one-time charges recorded during the
second quarter of 2002.

The Company calculates adjusted net earnings (loss) as net
earnings (loss) before discontinued operations, the effects of
changes in accounting policies, restructuring and other one-time
charges and the related income tax effect. Adjusted net loss for
the second quarter of 2003 of $2.8 million, or $0.10 per share,
compares to an adjusted net loss of $1.8 million, or $0.06 per
share, for the same period last year.

The Company reported positive cash flow from operations of $9.9
million and a reduction in bank debt of $13.7 million from the end
of the first quarter of 2003. The net cash cycle was 31 days,
compared to 44 days for the second quarter of 2002.

Gross profit on a GAAP basis for the second quarter of 2003 was
$4.9 million, or 6.6% of revenue, compared to $7.0 million, or
4.3% of revenue, for the same period in the prior year. The
improvement in the gross margin percentage reflects the focus on
higher margin sectors coupled with improved manufacturing
efficiencies as we realize the benefits arising from our
restructuring initiatives. The decline in the gross profit is
primarily a result of lower sales, offset by the positive effect
of changes in customer mix.

Operating loss on a GAAP basis for the second quarter of 2003 was
$4.1 million compared to an operating income on a GAAP basis of
$0.2 million for the same period in the prior year. The decrease
is due to lower sales and to the restructuring and other one-time
charges recorded during the period.

The Company recorded restructuring and other one-time charges of
$2.9 million during the second quarter of 2003. Currently the
Company is in discussions to sell its Appleton manufacturing
operations while retaining its design and engineering capabilities
at this site. Accordingly a restructuring charge of $3.2 million
was recorded reflecting the write-down of the Appleton assets to
the estimated realizable value. The balance of the restructuring
and other charges relate to severance and other charges of $0.9
million, offset by adjustments to previously recorded estimates of
$1.0 million arising from the settlement of certain obligations
for less than the original estimated amounts, and a gain of $0.2
million on the disposal of assets previously written down.

The Company's June 29, 2003, balance sheet shows a working capital
deficit of about $17 million and a net capital deficit of about
$22 million.

Frank Burke, Chief Financial Officer of SMTC commented, "During
the past two years the Company has focused its attention on
lowering indebtedness and improving liquidity and profitability.
The Company has taken extensive actions during this time including
the disposal of non-performing assets, the reduction of the number
of operating sites, the improvement in manufacturing efficiencies
and the focus on higher margin business. While the Company has
confidence in its continuing prospects, given the weakness and
uncertainty in the current economic environment, we believed it
was prudent to fully provide for the deferred tax asset. These
initiatives are appropriate given the conditions in the industry
and the Company's many actions to position itself for the future."

SMTC's President and C.E.O., Paul Walker added, "Over the past two
years we have focused on improving profitability through the
pursuit of higher margin business and cost reduction initiatives.
We continue to diversify our sales base to reduce our reliance on
the communications sector, with our industrial sector accounting
for 45% of our revenue for the period. Our strategy is to shift
production to our cost effective Mexican and Canadian facilities
resulting in the closure of our Austin and Charlotte sites and the
pending sale of the Appleton manufacturing operations."

The Company also announced the resignation of Mr. Frank Burke,
Chief Financial Officer.  Mr. Burke will remain with the Company
through a transitional period, which allows for a successor to be
named.

Paul Walker, CEO, commented, "Frank has been with us during a
period of pronounced change. During the period, we have
significantly improved our cost structure and reduced our debt by
over 50%. We are thankful for Frank's contribution in this regard
and wish him the best in the future."

Frank Burke, Chief Financial Officer, added, "I joined the firm in
October 2001 to assist in the Company's restructuring initiatives.
The past two years have been a period of substantial turmoil in
the EMS industry. In this time period, I believe we have made the
necessary changes at SMTC to create a foundation upon which to
prosper in the future. I believe that I have completed the tasks
that I had set out and that this is an appropriate time for me to
make this change."

SMTC Corporation is a global provider of advanced electronic
manufacturing services to the technology industry. The Company's
electronics manufacturing and technology centers are located in
Appleton, Wisconsin, Boston, Massachusetts, San Jose, California,
Toronto, Canada, and Chihuahua, Mexico. SMTC offers technology
companies and electronics OEMs a full range of value-added
services including product design, procurement, prototyping,
printed circuit assembly, advanced cable and harness interconnect,
high precision enclosures, system integration and test,
comprehensive supply chain management, packaging, global
distribution and after-sales support. SMTC supports the needs of a
growing, diversified OEM customer base primarily within the
networking, communications and computing markets.  SMTC is a
public company incorporated in Delaware with its shares traded on
the Nasdaq National Market System under the symbol SMTX and on The
Toronto Stock Exchange under the symbol SMX. Visit SMTC's Web site
at http://www.smtc.comfor more information about the Company.


SUN HEALTHCARE: Has Until September 15, 2003 to Challenge Claims
----------------------------------------------------------------
U.S. Bankruptcy Court Judge Fitzgerald gave the Sun Healthcare
Debtors an extension of their Claims Objection Deadline to
September 15, 2003.

The Debtors continue to analyze the claims register and its books
and records, the Debtors anticipate the need for filing further
omnibus objections to claims, or motions to re-characterize
claims, on various bases. (Sun Healthcare Bankruptcy News, Issue
No. 58; Bankruptcy Creditors' Service, Inc., 609/392-0900)


SWIFT & CO.: Exchange Offer for 10-1/8% Notes Expires Today
-----------------------------------------------------------
Swift & Company announced that the expiration date for its offer
to exchange $268,000,000 aggregate principal amount of its
10-1/8% Senior Notes Due 2009, which have been registered under
the Securities Act of 1933, as amended, for $268,000,000 aggregate
principal amount of its 10-1/8% Senior Notes Due 2009, is extended
until 5:00 p.m. New York City time today, unless further extended
by Swift & Company prior to such time.

The expiration date for the Exchange Offer was 5:00 p.m., New York
City time, on August 11, 2003, at which point, approximately
$267,995,000 of the $268,000,000 aggregate principal amount of the
outstanding Old Notes had been tendered for exchange.

The extension is intended to allow additional time for the holders
of the remaining outstanding Old Notes to tender in exchange for
the New Notes.  As a result of the extension, tenders of the Old
Notes, received to date, may continue to be withdrawn at any time
on or prior to the new expiration date.

As reported in Troubled Company Reporter's March 20, 2003 edition,
Standard & Poor's Ratings Services assigned its 'B' rating to beef
and pork processor Swift & Co.'s $150 million senior subordinated
notes due 2010, issued under Rule 144A with registration rights.

At the same time, Standard & Poor's affirmed its 'BB-' corporate
credit, 'BB' senior secured bank loan, and 'B+' senior unsecured
debt ratings on Swift.


TIMMIMCO: Reports Improved Balance Sheet Following Debt Workout
---------------------------------------------------------------
Timminco Limited -- the world leader in manufacturing and
supplying engineered magnesium extrusions and an international
leader in the production and marketing of specialty magnesium,
calcium and strontium metals and alloys -- announced financial
results for the second quarter of 2003.

                                           (000's)
                                          (unaudited)

                            Three Months Ended  Six Months Ended
                                  June 30,          June 30,
                               2003    2002      2003    2002
                               ----    ----      ----    ----

Sales                         $26,975 $29,049   $54,288 $59,003

Gross profit                    5,257   6,665    12,253  14,330

Income before noted items
  and taxes                     1,856   1,723     5,214   4,351

Net income                      1,776   2,250     5,005   4,234

                   MANAGEMENT DISCUSSION AND ANALYSIS


On April 2, 2003, the Corporation completed its previously
announced financial restructuring. A new credit agreement was
entered into with the Bank of Nova Scotia and six million common
shares were issued to Becancour L.P., an affiliate of Safeguard
International Fund L.P. The Board of Directors and Management
believe that new prospects for development and expansion of the
Corporation's business should follow from this stabilized and
viable base.

                    Financial Results - Second Quarter

Net income of $1.8 million in the second quarter of 2003 compared
to net income of $2.3 million in the corresponding period of 2002.
Year-to-date net income of $5 million was $0.8 million higher than
in 2003 as a result of strong performance in the first quarter of
2003. The decline in the second quarter of 2003 was the net result
of the changes outlined below.

Revenues in the second quarter were 7% lower than in the
corresponding quarter of 2002. An approximate 9% decrease was
itself related to the translation of US dollar denominated sales
into Canadian currency.

Year-to-date revenues were 8% lower than in the corresponding
period of 2002. An approximate 7% decrease was itself attributable
to the translation of US dollar denominated sales into Canadian
currency. Both for the second quarter and year-to-date, increased
market share in magnesium-alloy slabs and strong magnesium anode
sales were largely offset by declining volumes in certain
extrusions and specialty metals attributable primarily to general
economic factors and some loss of strontium market share. Year-to-
date there were also some volume and market share declines for
extruded magnesium-alloy anodes and pure magnesium due principally
to foreign competition. In aggregate, sales volumes were little
changed for the quarter or year-to-date relative to the
corresponding periods of 2002.

The gross profit of $5.3 million in the second quarter of 2003
represented 19.5% of revenue compared to $6.7 million or 22.9% in
the second quarter of 2002. The gross profit of $12.3 million
year-to-date represented 22.6% of revenue compared to $14.3
million or 24.3% in the corresponding period of the prior year.
The net impact of the weaker US dollar on revenues and purchases
had the effect of decreasing the gross profit by approximately
6% in the second quarter and 5% year-to-date in 2003 relative to
the corresponding periods of 2002. Increased natural gas prices
decreased the gross profit margin by roughly 1% in the second
quarter of 2003 and 2% year-to-date. Increased prices for
purchased magnesium decreased the gross profit margin by
approximately 2% in the second quarter of 2003 and 1% year-to-
date. Cost reductions in operating areas, many of which were
instituted in 2002, and the product-mix-sold increased the gross
profit margins by roughly 6% both in the second quarter of 2003
and year-to-date.

Year-to-date foreign exchange gains of $1.5 million in 2003 and
$0.3 million in 2002 are due principally to the revaluation of US
dollar denominated working capital and bank liabilities. The
second quarter 2003 foreign exchange gain also includes an
unrealised gain of $0.5 million on outstanding forward exchange
contracts for July and August of 2003. The ending US/Canadian
exchange rates for the second quarters of 2003 and 2002 were
respectively 1.35 and 1.51. The average US/Canadian exchange rates
for the second quarters of 2003 and 2002 were respectively 1.41
and 1.55. The average US/Canadian exchange rates for the year-to-
date periods of 2003 and 2002 were respectively 1.46 and 1.57. As
sales and purchases are converted at exchange rates applicable at
the time of the transactions, the year-to-year changes from
translation of US dollar denominated revenues and cost-of-sales
are recognized within gross margins as opposed to within foreign
exchange gains or losses.

Selling and administration expenses of $2.4 million were $0.5
million lower in the second quarter of 2003 relative to expenses
of $2.9 million in the corresponding period of 2002, principally
due to several vacant positions and the absence of a catch-up
accrual for management compensation recorded in 2002. Year-to-date
selling and administration expenses of $4.6 million were $0.7
million lower than in the corresponding period of 2002 for the
same reasons and due to a decrease in the provision for bad debts
due to a continued improvement in the Corporation's past-due
receivables.

Interest expense decreased to $0.9 million in the year-to-date
period of 2003 from $1.7 million in the corresponding period of
2002. The decrease in interest expense was attributable to lower
average balances as well as to lower interest rates.

Financial restructuring expenses were minimal in 2003, as the
refinancing project was being concluded, while $1.0 million was
expended through the second quarter of 2002. The expenses included
related consulting, legal, financing and other professional fees.

In the first quarter of 2003, it was determined that the profiling
of mine tailing piles at the Haley mine will probably cost more
than previously estimated and therefore the environmental
provision was increased by approximately $0.1 million in that
quarter.

As previously reported, idle production equipment, previously
written-off in 2000, was sold in the first quarter of 2002,
resulting in a gain on the sale of $1.0 million.

In 2002 future income taxes were accrued at an average
consolidated international rate of 35% of pre-tax income, and in
2003 future income taxes were accrued at an average rate of 34% of
pre-tax income. In both years, these accruals were offset by
reductions in the tax-asset valuation allowance as the Corporation
anticipates recovering a greater portion of its future tax assets.

                         Capital Expenditures

Year-to-date 2003 capital expenditures of $1.3 million were for
the development of dual casting capabilities at the Haley
casthouse and various small projects. The capability to cast using
different methods is expected to enhance capacity and
productivity, reduce operating costs, and allow the casting of
more varied shapes. The development of dual casting capability is
anticipated to cost approximately $2.1 million, including $2.0
million expended to date, and is nearly complete as of the end of
the second quarter of 2003. Capital expenditures for 2003 are
projected to be $3.7 million. Operating cash flows are forecasted
to provide the funding for the future portion of these capital
expenditures.

                   Liquidity and Capital Resources
               including Bank Debt and Working Capital

Effective April 2, 2003, the Corporation entered into an amended
and restated credit agreement with the Bank of Nova Scotia.
Pursuant to the Credit Agreement, the Bank provided revolving
credit lines of Canadian $5.0 million and US $5.0 million and non-
revolving lines aggregating US $13.5 million. The non-revolving
lines were immediately reduced by Canadian $1.5 million utilizing
a portion of the proceeds from the Becancour private placement
described below under "Stock Issue". On June 30, 2003 a principal
repayment of Canadian $0.8 million was paid the Bank and a non-
revolving credit line was reduced by the same amount.

At June 30, 2003, lines of credit, measured at the exchange rate
of US/Canadian 1.35, approximated Canadian $27.7 million. The
current and long-term portions of bank debt outstanding at
June 30, 2003 aggregated $18.5 million. The revolving credit lines
are due upon demand and the non-revolving lines, with quarterly
principal payments of $0.8 million, mature on March 31, 2005. The
current portion of long term debt includes $2.0 million as an
approximation of an excess cash sweep stipulated to be paid to the
Bank in April of 2004. The Credit Agreement is subject to certain
covenants, conditions and reporting requirements. Under the new
agreement Canadian dollar borrowings bear interest at the Bank's
prime rate plus up to 2.5% and US dollar borrowings bear interest
at the Bank's base rate plus up to 2.5%, however based upon
present financial ratios the effective rates are prime plus 1.5%
and base plus 1.5%, respectively.

The Corporation's operations generated positive cash flows of $3.5
million in the second quarter of 2003 and $8.4 million in the
year-to-date period compared to $3.9 million and $6.8 million in
the respective corresponding periods of 2002. As discussed below,
working capital decreased $1.8 million year-to-date. The cash
generated by operations and the working capital reduction in 2003
was principally used to fund a reduction in aggregate bank
indebtedness of approximately $8.5 million and capital
expenditures of $1.3 million.

At June 30, 2003 the Corporation achieved a working capital
surplus of $18.8 million versus a working capital deficiency at
December 31, 2002 of $3.4 million due principally to the
reclassification of a portion of its current bank debt to long-
term debt based upon completion of the Credit Agreement and due to
the reduction in aggregate bank debt resulting from favorable
operating results and the noted issuance of stock. Accounts
receivable decreased by $4.4 million since the end of 2002
reflecting the net impact of the collection of $1.2 million in
business interruption insurance proceeds related to the casthouse
fire of 2000, a $0.9 million reduction due to a change in terms to
a large customer, a decrease of approximately $0.4 million in
past-due accounts and the timing of sales. Prepaid expenses and
deposits increased $1.2 million since year-end due principally to
the advanced payment of insurance premiums, the purchase of
natural gas call options, and the recognition of a fair value
asset in forward contracts held to purchase US dollars. Accounts
payable and accrued liabilities decreased $1.4 million year-to-
date in part as purchases were shifted to vendors providing less
favorable credit terms.

                              Outlook

The Corporation anticipates similar revenue levels in 2003 to
those achieved in 2002, excluding the impact of changes in foreign
exchange rates, with modest increases in volumes in existing
product lines offsetting the impact of competitive pressures
primarily from foreign suppliers in extruded magnesium-alloy
products and primary magnesium. As the vast majority of sales are
denominated in US dollars, reported sales will be affected
proportionally with changes in the exchange rate between the
Canadian dollar and the US dollar.

Operating costs are expected to increase on balance in 2003 due to
increases in natural gas and purchased magnesium prices and
increased insurance and benefit costs, offset to a large degree by
specific improvements in operating practices, various purchasing
initiatives, and savings from the dual casting capability in the
casthouse in the second half of 2003. Selling expenses are
expected to increase in the second half of 2003 as a result of a
program to increase our presence in existing markets and develop
additional markets in the longer term. Interest and restructuring
costs are expected to decrease in 2003.

While the Corporation has historically been exposed to swings in
commodity prices and foreign exchange rates, and will continue to
be exposed to some extent, it is increasingly endeavouring to
reduce these risks through hedging or long-term contracts, when
available. In the first quarter of 2003, the Bank extended the
Corporation facilities to enter into foreign exchange contracts of
up to six months in duration, and the Corporation has utilized
these facilities. The Corporation also bought call options for
natural gas in the second quarter of 2003 to limit unfavourable
exposures through October of 2004.

Maintaining or improving cash flows and profitability through
long-term growth, more efficient operations and effective
purchasing strategies remain priorities for management. The
Corporation expects the global magnesium market to remain highly
competitive for the foreseeable future.


TRANS-INDUSTRIES: Taps Relational Advisors to Aid in Refinancing
----------------------------------------------------------------
Trans-Industries, Inc. (Nasdaq: TRNI), a manufacturer of lighting
products for busses, particle extraction systems, electronic
information systems and software, and related components for the
mass transit and highway markets, announced results for the second
quarter and six months ended June 30, 2003.

Sales for the quarter were $8.5 million compared with $8.3 million
for the year-ago period. Included in last year's results were
approximately $400,000 of sales from a U.K. subsidiary, which was
sold in the first quarter of 2003. For the six-month period ended
June 30, 2003, sales were $17.2 million compared with $17.1
million last year, with $1.1 million of these 2002 sales
attributable to the operation that was sold. Adjusting for these
relinquished sales, a volume increase of approximately 8% was
realized for the second-quarter and six-month periods ending June
30, 2003.

Incoming orders rose significantly above 2002 levels for lighting,
environmental and information products. In total, increases of
more than 53% for the quarter and 76% for the first six months
were realized compared with the same periods last year. Related to
this was an increase in the Company's backlog, which rose to $17.0
million at the end of June 2003, compared with $13.0 million at
June 30, 2002.

A poor performance in April by the information systems business,
partially offset by pretax profits later in the second quarter,
resulted in a loss of $137,000, or $0.04 per share, for the second
quarter of 2003. For the comparable quarter of 2002, a profit of
$43,000, or $0.01 per share, was recorded in part because in June
2002, Trans-Industries received a federal income tax refund, which
was $396,000 higher than the estimated reserve established at
December 31, 2001, due to a change in carry back provisions of the
tax law. Accordingly, the excess refund was credited in the second
quarter of 2002. Included in the loss of $137,000 were bank and
consulting fees of more than $200,000. These fees were primarily
the result of the Company not replacing its primary lender with
other financing. Trans- Industries anticipates having a new lender
in place early in the fourth quarter. For the six months ended
June 30, 2003, the Company recorded a net loss of $610,000, or
$0.19 per share. This compared with a net profit of $352,000, or
$0.11 per share, for the same period in 2002.

To address its profitability, in July Trans-Industries initiated a
significant restructuring program in the informational systems
business. Costs associated with this restructuring, which include,
but are not limited to, severance costs, legal fees, and advisor
fees, have not yet been determined. However, they will be reported
as a separate line item (restructuring charge) in the third
quarter. Actions being implemented include personnel reductions,
elimination of various contract employees, elimination of certain
product lines, and the appointment of new management for the
informational systems business. A further cost reduction is
expected from the consolidation of the information systems
business' two manufacturing facilities into one. Accordingly, the
Company's Rochester Hills facility has been listed with a broker
for sale.

During the second quarter of 2003, Mr. Harry E. Figgie Jr.
resigned from Trans-Industries' board of directors due to health
concerns. The Company is currently considering candidates to
replace Mr. Figgie. The board would like to express its gratitude
to Mr. Figgie for his long-standing contributions to the Company.

Trans-Industries continues to be in default on certain covenants
of its bank debt. The Company has not received a waiver for these
defaults and the lender has reserved its rights and remedies. The
lender has been monitoring the Company's demand line of credit and
its term and mortgage loans. Efforts are currently underway to
refinance this debt. Trans-Industries has retained Relational
Advisors, LLC, financial advisors, to assist with ongoing
discussions with its lender, and in the refinancing efforts of
this debt. As a result of these circumstances, the Company has
reflected all of its existing lender debt as current at the end of
the second quarter even though the lender has not accelerated term
debt maturity or demanded payment.

The Company is a leading provider of lighting systems and related
components to the mass transit market as well as a supplier of
information hardware and software solutions on Intelligent
Transportation Systems (ITS) and mass transit projects. ITS
utilizes integrated networks of electronic sensors, signs and
software to monitor road conditions, communicate information to
drivers and help transportation authorities better manage traffic
flow across their existing infrastructures.


TRENWICK: Fitch Withdraws Various Long-Term & Sr. Debt Ratings
--------------------------------------------------------------
Fitch Ratings has affirmed and withdrawn its long-term and senior
debt rating on Trenwick America Corp., and its long-term ratings
on Trenwick Group, Ltd. Fitch has also affirmed and withdrawn its
long-term and preferred stock rating on Trenwick's LaSalle Re
Holdings, Ltd.'s subsidiary and its rating on Trenwick Capital
Trust I's capital securities. Fitch's rating action follows
Trenwick's August 7, 2003 announcement that it had signed a letter
of intent to restructure its debt obligations. The restructuring
will include a Chapter 11 bankruptcy filing in the U.S. and
similar proceedings in Bermuda, Barbados, or the U.K.

     Trenwick Group, Ltd.

        -- Long-term Affirm/ Withdraw 'D'.

     Trenwick America Corp.

        -- Long-term Affirm/ 'D'; Senior debt Withdraw 'D'.

     LaSalle Re Holdings, Ltd.

        -- Long-term Affirm/ 'D'; Preferred stock Withdraw 'C'.

     Trenwick Capital Trust I

        -- Preferred capital sec Affirm/ Withdraw 'C'.


UBIQUITEL INC: Second Quarter 2003 Net Loss Hits $9 Million Mark
----------------------------------------------------------------
UbiquiTel Inc. (Nasdaq: UPCS), a PCS Affiliate of Sprint (NYSE:
FON, PCS), announced strong financial and operating results for
the second quarter ended June 30, 2003, reflecting significant
improvement on many key metrics.

Highlights for the 2nd Quarter 2003:

    --  Earnings before interest, taxes, depreciation and
        amortization was $5.1 million, a $5.0 million improvement
        over the first quarter 2003 and a $15.0 million
        improvement over the second quarter 2002 EBITDA loss of
        $9.9 million.

    --  ARPU for the second quarter 2003 increased to $58, a $4
        increase sequentially from the first quarter 2003, and
        flat compared to the second quarter 2002.  One dollar of
        the sequential increase was due to a one-time revenue
        adjustment from Sprint PCS relating to E911 surcharges to
        customers in the UbiquiTel service area.

    --  Net adds for the quarter were approximately 17,600,
        bringing total subscribers, excluding resellers, to
        approximately 291,800.  Eighty-eight percent of the net
        adds were in prime credit classes, and 73% of subscribers
        were in prime credit classes as of quarter-end.

    --  Churn improved to 2.9% from 3.4% in the first quarter 2003
        and 4.1% in the second quarter 2002.

    --  UbiquiTel generated $3.9 million of free cash flow during
        the second quarter 2003 aided by the receipt of an $8.1
        million federal income tax refund.  As of June 30, 2003,
        cash, cash equivalents and restricted cash was
        approximately $60.1 million and the company had an unused
        bank revolving line of credit of approximately $50.0
        million.

    --  During the second quarter 2003, net debt was reduced by
        $5.2 million aggregate principal amount ($4.0 million
        aggregate accreted value). UbiquiTel purchased in the open
        market $6.9 million of its 14% senior subordinated
        discount notes for $1.1 million.  A gain of $3.9 million
        was recognized in conjunction with the retirement of these
        notes. UbiquiTel issued in aggregate $1.7 million of 14%
        Series B senior discount notes to fund these note
        purchases.

"Our unwavering commitment to quality, profitable growth and sound
balance sheet management continues to translate to strong
financial performance for UbiquiTel," said Donald A. Harris,
chairman and CEO of UbiquiTel Inc. "Significant sequential
improvement in critical value drivers such as subscriber quality,
ARPU and churn resulted in better than expected EBITDA growth and
cash liquidity."

Total revenues were $66.0 million in the second quarter 2003, a
sequential increase of 13% from the first quarter 2003 level, and
a 23% increase over the second quarter 2002.  Revenues were
comprised of $49.5 million of subscriber revenues, $13.9 million
of roaming revenues and $2.6 million of equipment revenues.
Subscriber revenues increased 15% sequentially from the first
quarter 2003 level and 36% from the second quarter 2002.  Roaming
revenues increased by 5% over the first quarter 2003 level and
decreased by 9% over the same period a year ago.

The reported net loss for the second quarter 2003 was $8.9 million
or $0.11 per share compared to reported net income of $16.8
million or $0.18 per share in the first quarter 2003.  The
reported results include gains on the retirement of debt of
approximately $3.9 million or $0.05 per share and $39.0 million or
$0.43 per share during the second quarter and first quarter 2003,
respectively.  The net loss was $31.1 million or $0.38 per share
in the second quarter 2002.  Cost per gross add (CPGA) was $452
which was relatively flat with the second quarter 2002 CPGA of
$456 and $20 higher than the first quarter 2003.  Cash cost per
user (CCPU) of $46 was flat with the first quarter 2003 CCPU and
33% lower than the second quarter 2002.  Capital expenditures
during the second quarter 2003 were $2.5 million.

"In addition to our strong second quarter operating performance,
we are equally pleased with the Qwest wholesale and Sprint Montana
coverage agreements announced last week that will enhance our
earnings potential and reduce our future capital expenditure
requirements," Harris added.  "We now expect to be able to
generate positive free cash flow in 2004 and beyond."

UbiquiTel (S&P, CCC Corporate Credit Rating, Developing) is the
exclusive provider of Sprint digital wireless mobility
communications network products and services under the Sprint
brand name to midsize markets in the Western and Midwestern United
States that include a population of approximately 10.0 million
residents and cover portions of California, Nevada, Washington,
Idaho, Wyoming, Utah, Indiana and Kentucky.

Sprint operates the largest, 100-percent digital, nationwide
wireless network in the United States, serving more than 4,000
cities and communities across the country.  Sprint has licensed
PCS coverage of more than 280 million people in all 50 states,
Puerto Rico and the U.S. Virgin Islands.  In August 2002, Sprint
became the first wireless carrier in the country to launch next
generation services nationwide delivering faster speeds and
advanced applications on PCS Vision Phones and devices.  For more
information on products and services, visit
http://www.sprint.com/mr  PCS is a wholly-owned tracking stock of
Sprint Corporation trading on the NYSE under the symbol "PCS."
Sprint is a global integrated communications provider serving more
than 26 million customers in over 100 countries.  With
approximately 70,000 employees worldwide and nearly $27 billion in
annual revenues, Sprint is widely recognized for developing,
engineering and deploying state-of-the-art network technologies.


UNITED AIRLINES: Intends to Amend Aircraft Financing Agreements
---------------------------------------------------------------
James H.M. Sprayregen, Esq., at Kirkland & Ellis, relates that
after months of vigorous negotiations, United Airlines and certain
of its Aircraft Financiers have reached agreements to amend or
restructure financing arrangements.  Some of the key aspects of
the Proposed Transactions are:

   a) United's rejection of Existing Aircraft Agreements to the
      extent they are executory contracts or unexpired leases;

   b) reservation of the Aircraft Financiers' rights to assert
      general unsecured non-priority prepetition claims for
      damages relating to United's rejection of the Agreements or
      the amendment/restatement of the Agreements;

   c) payment of claims arising out of United's use of the
      Aircraft since the Petition Date; and

   d) entry by United and the applicable Aircraft Financiers into
      new operating leases and Agreements covering the Aircraft.

The Restructured Agreements provide substantial benefits to
United and its estate.  First, the Agreements will reduce
United's payment obligations.  Second, they will reduce non-
payment obligations like maintenance of insurance and events of
loss.  Third, United's right to terminate or reject the
Agreements regardless of the status of a Reorganization Plan or
in the event the case is dismissed or converted to a Chapter 7,
is reserved.  Finally, the Agreements limit administrative
expense claims and general unsecured non-priority claims relating
to United's rejection or termination of an Agreement or its
failure to comply with certain provisions.

By this motion, the Debtors ask Judge Wedoff to:

   1) authorize United to reject certain existing Aircraft
      Agreements;

   2) modify the automatic stay to allow Aircraft Financiers to
      exercise remedies under the Agreements;

   3) authorize United to settle claims arising from the rejected
      and/or restructured Agreements; and

   4) authorize United to amend certain Aircraft Agreements and
      consummate postpetition operating Lease Transactions.
      (United Airlines Bankruptcy News, Issue No. 24; Bankruptcy
      Creditors' Service, Inc., 609/392-0900)


UPC POLSKA: Court Sets Disclosure Statement Hearing for Sept. 16
----------------------------------------------------------------
The Honorable Judge Burton R. Lifland has scheduled the Hearing to
approve the adequacy of the Disclosure Statement of UPC Polska,
Inc.  As previously reported in the Troubled Company Reporter's
July 16, 2003 issue, the Debtor filed its Prepackaged
Reorganization Plan in the U.S. Bankruptcy Court for the Southern
District of New York.

Judge Lifland will consider the adequacy of the Debtor's
Disclosure Statement on September 16, 2003 at 10:00 a.m. (Eastern
Time) in his courtroom in the United States Bankruptcy Court for
the Southern District of New York, Alexander Hamilton Custom
House, One Bowling Green, New York, New York 10004.

All written objection to the Disclosure Statement or the
Solicitation and Tabulation of Procedures must provide a specific
reference it objected and must be filed with the Court, with hard
copy delivered to Judge Lifland's chambers and received by:

       a) counsel to the Debtor
          Baker & McKenzie
          101 West Broadway, Twelfth Floor
          San Diego, CA 92101
          Attn: Ali M.M. Mojdehi, Esq.

          Baker & McKenzie
          805 Third Avenue
          New York, NY 10022
          Attn: Ira A. Reid, Esq.;

       b) counsel to the UPC Entities and Polska Finance
          White & Case LLP
          1155 Avenue of the Americas
          New York, NY 10036
          Attn: Howard S. Beltzer, Esq.;

       c) counsel to the Participating Noteholders
          Cahill, Gordon & Reindel LLP
          80 Pine Street
          New York, NY 10005
          Attn: Roger Meltzer;

       d) counsel to any appointed creditors committee; and

       e) the Office of the United States Trustee
          33 Whitehall Street, Suite 2100
          New York, NY 10004

on or before September 9, 2003 at 4:00 p.m., Eastern Time.

UPC Polska, Inc., who holds headquarters in Denver, Colorado, is
an affiliate of United Pan-Europe Communications N.V.  The Debtors
is a holding company, which owns various direct and indirect
subsidiaries operating the largest cable television systems in
Poland. The Company filed for chapter 11 protection in July 7,
2003 (Bankr. S.D.N.Y. Case No. 03-14358).  Ali M.M. Mojdehi, Esq.,
and Ira A. Reid, Esq., at Baker & McKenzie represent the Debtor in
its restructuring efforts.  As of March 31, 2003, the Debtor
listed $704,000,000 in total assets and $940,000,000 in total
debts.


U.S.I. HOLDINGS: Closes $155 Million Sr. Secured Credit Facility
----------------------------------------------------------------
U.S.I. Holdings Corporation, (Nasdaq: USIH) has completed a
$155,000,000 senior secured credit facility with several lending
institutions.

The facility includes a $30,000,000 four-year revolving credit
facility and a $125,000,000 five-year term loan facility.

USI intends to use the proceeds from the term facility to repay
all amounts under its previously existing term and revolving
credit facility. Additionally, proceeds from the term facility
will be used to payoff a portion of existing notes issued in prior
acquisitions, to pay expenses related to the closing of the new
credit facility and for general corporate purposes.  The revolving
credit facility will be "untapped" as of the date of issue and
will be used for general corporate purposes, including
acquisitions.

Commenting on the transaction, David L. Eslick, USI's Chairman,
President, and CEO, said, "We entered 2002 with a stated goal of
making significant headway in de-leveraging and solidifying our
capital structure to meet our long term business goals of
consistent organic revenue growth, margin expansion, and
disciplined accretive acquisitions.  The combination of our
successful IPO in October, 2002 with today's announced refinancing
of our credit facilities, has positioned USI to deliver on these
goals."

Eslick further stated, "We believe that the strong positive
response of the lending community to participate in this new
credit facility is a significant endorsement of the improvement in
our operating and financial model. Our new credit facility's lower
interest rates and more favorable amortization schedules will help
strengthen our earnings and available cash flow."

Founded in 1994, USI is a leading distributor of insurance and
financial products and services to businesses throughout the
United States.  USI is headquartered in Briarcliff Manor, NY, and
operates out of 63 offices in 19 states.

As reported in Troubled Company Reporter's July 28, 2003 edition,
Standard & Poor's Ratings Services raised its counterparty credit
and bank loan ratings on USI Holdings Corp. to 'BB-' from 'B+'
because of the company's improving coverage ratios, prospective
ability to satisfy debt covenants, much improved operating
results, and reduced debt leverage. Offsetting the much improved
company profile are USI's short tenure as a public company and
lack of a consistent, sustained, profitable track record.

Standard & Poor's also said that the outlook on USI is stable.


VHJ ENERGY LLC: Case Summary & 11 Largest Unsecured Creditors
-------------------------------------------------------------
Debtor: VHJ Energy, LLC
        504 B Fort Street
        Buffalo, Wyoming 82834

Bankruptcy Case No.: 03-21602

Chapter 11 Petition Date: August 8, 2003

Court: District of Wyoming (Cheyenne)

Judge: Peter J. McNiff

Debtor's Counsel: Georg Jensen, Esq.
                  Law Offices of Georg Jensen
                  1613 Evans Avenue
                  Cheyenne, WY 82001
                  Tel: 307-634-0991

Total Assets: $3,525,395

Total Debts: $3,285,478

Debtor's 11 Largest Unsecured Creditors:

Entity                                            Claim Amount
------                                            ------------
Bear Paw Energy                                       $343,467
1400 16th Street
Suite 310
Denver, CO 80202

Federated Oil & Gas Prop                              $245,561

BTS LLC                                               $141,783

Jackson Electric Inc.                                  $66,806

McJunkin Appalachian Oil Field                         $49,800
Supply Co.

Paramount Contracting Co.                              $27,896

Dave's Flow                                             $5,067

R2R Energy LLC                                          $4,754

Meagher Oil & Gas                                       $3,831

CBM Pumps & Svc                                         $3,716

J & J Drilling & Svc.                                     $200


WINSTAR COMMS: BEA Systems Seeks Stay Relief to Setoff Claims
-------------------------------------------------------------
On October 30, 1998, the Winstar Communications Debtors and BEA
Systems, Inc. entered into a three-year Software License Agreement
whereby BEA agreed to provide the Debtors with certain software,
and support and maintenance service.  The Agreement provides that
the Debtors will continue to receive Support Service in one-year
increments under BEA Systems' current fees and policies subject to
the restrictions contained in the Agreement.  The Agreement
covered the initial order and any additional orders for BEA
Systems products or support services submitted subsequently during
the life of the Agreement.

According to Katharine L. Mayer, Esq., at McCarter & English,
LLP, in Wilmington, Delaware, the Agreement included a provision
selecting New York law as the applicable law to resolve disputes
in connection with the agreement.

BEA Systems sent an invoice dated October 29, 2000 to the Debtors
to cover the provision of the Support Services for the period
October 30, 2000 through October 29, 2001.  Pursuant to the terms
of the invoice and the Agreement, the Debtors were supposed to
pay $1,610,437 by November 23, 2000.  Despite the fact that it
received the software and the Support Services from BEA Systems,
Ms. Mayer notes that the Debtors never paid the $1,610,437.

In addition, BEA Systems provided consulting services to the
Debtors during the period October 2000 through March 2001, which
remains unpaid.  The total amount of those consulting services is
$129,600.

On November 5, 1999, BEA Systems sold software for $7,000,000 and
support and maintenance for the software for $1,575,000 to the
Debtors.  The combined total for the invoice was $8,575,000.
As part of the Sale, the Debtors paid a $350,438 sales tax.

On December 4, 2002, the Debtors advised BEA Systems that it was
exempt from the sales tax in Virginia.  Accordingly, BEA Systems
filed an amended tax return with the State of Virginia, seeking a
refund for the sales tax in the transaction with the Debtors.

On April 21, 2003, the State of Virginia refunded BEA Systems the
sales tax paid on the November 5, 1999 Sale and the accrued
interest for a total of $437,963.  BEA Systems now wants to set
off the Refund against the prepetition amount owed by the
Debtors.

Accordingly, BEA Systems, Inc. asks the Court to modify or
terminate the automatic stay so it may exercise its set-off
rights pursuant to Section 553 of the Bankruptcy Code.

Section 553 of the Bankruptcy Code preserves a creditor's right
to set off mutual obligations with a debtor.  The language of
Section 553, Ms. Mayer explains, does not create a right of set-
off where none exists.  Rather, it recognizes the existence of
the doctrine under applicable non-bankruptcy law, and provides
for further restrictions.  Therefore, before considering set-off
under Section 553, the parties must be entitled to set-off under
applicable non-bankruptcy law.

In BEA Systems' case, the applicable non-bankruptcy law is New
York's.  When a choice between the laws of different states is
presented with respect to determining the underlying set-off
rights, bankruptcy courts apply the general diversity choice of
rule law set forth in Klaxon Co. v. Stentor Elec. Mfg. Co., 313
U.S. 487, 61 S.Ct. 1020 (1941).  Ms. Mayer notes that the
requirements for set-off under New York law are essentially the
same as those set forth in Section 553.

To establish its rights under Section 553, a party must show
these three elements:

   1. A debt exists from the creditor to the debtor and that debt
      arose before the commencement of the bankruptcy case;

   2. The creditor has a claim against the debtor, which arose
      before the commencement of the bankruptcy case;

   3. The debt and the claim are mutual obligations.

Ms. Mayer asserts that an analysis under Section 553 is
sufficient to establish BEA Systems' rights.  There can be no
dispute that BEA Systems has a claim against the Debtors for
failure to pay on its prepetition contract.  Likewise, BEA
Systems owes the Debtors for the refund it obtained from the
State of Virginia.  The fact that the Refund was obtained
postpetition does not transform BEA Systems' debt into a
postpetition liability.

Therefore, Ms. Mayer insists, the Court should lift the automatic
stay. (Winstar Bankruptcy News, Issue No. 46; Bankruptcy
Creditors' Service, Inc., 609/392-0900)


WORLDCOM: Church Group Urges FCC to Block Key License Transfers
---------------------------------------------------------------
The Office of Communication of the United Church of Christ, Inc.
filed late Friday a formal petition with the Federal
Communications Commission that could halt the transfer of key
licenses and authorizations from the bankrupt WorldCom to the new
MCI. The major new UCC action comes just days after allegations
that both the "old" WorldCom and the "new" MCI engaged in FCC-
regulated access charges manipulations that may have cheated
competitors out of up to $1 billion.

The Rev. Robert Chase, executive director of the Office of
Communication of the United Church of Christ, Inc., said: "We have
warned all along that the slate might not be wiped clean at
WorldCom and we now have reason to believe that is the case, even
though the company now calls itself by a new name: MCI. I take FCC
Chairman Michael Powell, who is a member of President Bush's task
force on corporate fraud, at his word when he says that he wants
to 'hurt' wrongdoers for their misconduct. Nowhere is there a more
crying need for the FCC to send a clear message that character
counts than in the case of WorldCom/MCI."

The United Church of Christ is a mainline Protestant denomination
of 1.4 million members in more than 6,000 churches, 30 colleges
and institutions of higher education, 15 seminaries and more than
340 health and human service centers in every state and in Puerto
Rico. In July, the UCC Synod adopted a resolution related to
"corporate greed" that specifically endorses holding WorldCom to
account for its misdeeds. (To read the Synod resolution, go to
http://www.ucc.org/synod/news/)

Noting that the UCC first flagged its concerns about the WorldCom
license/authorization transfer issue in an earlier filing on
October 15, 2002, UCC outside counsel Gregg P. Skall, of Womble
Carlyle Sandridge & Rice, in Washington, D.C., said: "According to
longstanding Commission policy, disqualifying allegations such as
those raised by UCC against WorldCom do not simply vanish. The
involvement of other government agencies in the review of
WorldCom's conduct should not deter the Commission from conducting
its own investigation and reaching its own conclusions. The
Commission cannot simply rely on the work of others. Only the FCC
is qualified to establish policy for the telecommunications
infrastructure."

The UCC action is available online at http://www.ucc.org/ocinc/

According to Skall, the church group's petition calls upon the FCC
to (1) halt the transfer of the old WorldCom's licenses and
authorizations to the new MCI, (2) force a hearing on whether or
not WorldCom is "unfit" to be a FCC licensee and (3) only transfer
the WorldCom licenses/authorizations to a company "with clean
hands and with sufficient character qualifications."

In the face of the WorldCom debacle, the Office of Communication
of the United Church of Christ, Inc., launched in October 2002 the
"Character Counts" Campaign. This effort was designed to persuade
the FCC to adopt rules of stewardship for these information-age
companies that use not only the public airways under public-
interest authorizations, but manage the nation's digital
infrastructure as well. The stakes for the nation's ailing
economy, workers, and American consumer are enormous.

WorldCom, the beleaguered telecom giant and second largest long
distance provider in the U.S., has become a worldwide symbol of
greed and financial deceit. The WorldCom debacle, the largest in
American corporate history, has cost investors in excess of $176
billion. WorldCom defrauded investors by overstating its earnings
by nearly $10 billion. Top executives profited from their own
criminal misdeeds -- while WorldCom employees, state pension
funds, and shareholders bore the brunt of WorldCom's criminal
malfeasance through lost jobs, worthless stock, and losses of
401(k) savings.

In October 2002, UCC petitioned the Federal Communications
Commission to block the transfer of federal licenses and
authorizations that WorldCom uses for its long distance, Internet,
and other services. UCC stated that "character counts" in the
corporate world as well as for individuals. On December 5, 2002,
the FCC denied UCC's informal objection to the transfer. UCC also
asked the FCC to undertake a Section 403 investigation under the
Communications Act into industry-wide practices to see, "how we
might halt the slide of some in the telecom industry into
corporate nihilism at the expense of the American people." At the
same time, UCC called on the FCC, "to retake the moral authority
that has been ceded to, and abandoned by, the leaders of WorldCom
and to restore confidence in the telecommunications industry." On
December 5, 2002, the FCC initiated a notice and comment
proceeding (RM 10613) in response to UCC's request for rulemaking.

For more about UCC's work in the WorldCom context, go to
http://www.ucc.org/ocinc/character/worldcom.htmon the Web.

The Office of Communication of the United Church of Christ, Inc.
is the media advocacy arm of the United Church of Christ. The
United Church of Christ was the first voice to demand that
broadcasters who use the public airwaves have a responsibility to
operate in the public interest. In the 1960s, the United Church of
Christ earned its place in U.S. broadcasting history by
successfully challenging the license of WLBT-TV in Jackson, Miss,
for refusing to broadcast news and information about African
Americans. This action was taken by the Office of Communication,
Inc., established by the Rev. Everett C. Parker, to protect the
denomination from legal action when it took prophetic risks in the
name of justice. The United Church of Christ continues to fight
for corporate responsibility and accountability to the public.


WORLDCOM INC: Wants Clearance for $21 Million Cisco Settlement
--------------------------------------------------------------
MCI WorldCom Networks Services, Inc. is a party to a June 24,
1999 Global Master Procurement Agreement and an August 1, 1995
System Integrator Agreement with Cisco Systems, Inc.  Under the
GMPA, Cisco develops and licenses various telecommunications
products and offers support services to MCI.  Under the SIA,
Cisco sells and licenses certain telecommunication products and
services to MCI, which are bundled with other "added value" items
consisting of non-Cisco components and services provided by MCI,
for the purpose of resale to end users.  The "added value"
includes pre-sales and post-sales network design, configuration,
trouble-shooting and support and sale of complementary products
and services that comprise a significant portion of the total
revenues MCI receive from its customers and end users of Cisco's
products and services.

Cisco alleges that the Debtors have failed to honor their
obligations under the Agreements by failing to pay certain
amounts that they received for Cisco's benefit from third-party
customers under the reseller arrangements.  Cisco also asserts
that certain portions of the amounts payable by the Debtors
represent postpetition obligations under the Agreements and,
therefore, constitute administrative expense claims.  In this
regard, Cisco filed various proofs of claim on January 21, 2003
totaling $25,856,693.  The Claims represent unpaid amounts
allegedly due Cisco under the Agreements.  Cisco also asserts
that additional amounts totaling $1,200,000 are due under various
invoices under the Agreements.

Cisco further asserts certain other unliquidated, disputed claims
against the Debtors for various breaches under the SIA.  Cisco
accuses that the Debtors (i) failed to provide "added value" to
its products and services resold to certain end users and (ii)
resold certain Cisco products to resellers, rather than only to
end users.  Cisco alleges that the Debtors' resale of its
telecommunication products and services -- which the Debtors are
entitled to purchase from Cisco at a discount under the SIA --
either without providing any added value or to the resellers,
interfered with its own sale efforts of the same products and
services in the market and depressed the prices for its
telecommunication products and services.  The Debtors deny these
Claims and allegations.

On July 25, 2003, the Debtors entered into a settlement agreement
with Cisco to, among other things, modify and assume the SIA and
GMPA and establish the cure amounts for the Agreements and
provide payment terms of the cure amounts.  Pursuant to the
Settlement, the Debtors will pay Cisco, by wire transfer,
$21,000,000, in full satisfaction of all its prepetition claims
under the SIA and GMPA.  The Cure Amount represents a compromise
that incorporates:

   -- the payment of amounts that Cisco asserts that the Debtors
      received for its benefit from the third party customers
      under reseller arrangements;

   -- the payment, on a discounted basis, of other amounts the
      Debtors allegedly owe to Cisco for the goods and services
      provided for their internal use; and

   -- a waiver of other unliquidated, disputed claims against the
      Debtors for various alleged breaches under the SIA.

Upon payment, Cisco will withdraw the Claims filed against the
Debtors.  It will also increase the credit line available to
them.  At the Debtors' request, Cisco will also consider in good
faith another increase on the effective date of the Debtors'
reorganization plan and periodic, temporary increases from time
to time to facilitate the Debtors' large reseller transactions.
Under the SIA and GMPA, fees for late payment of Cisco invoices
will be modified.  Cisco's limited indemnification obligations
for third party claims against the Debtors will also explicitly
include claims by their customers.

In return, the Debtors will waive and release all claims against
Cisco and any of its corporate affiliates that may arise under
Chapter 5 of the Bankruptcy Code and under any corollary statutes
and out of the Disputed Claims.

Thus, the Debtors ask the Court to approve the Cisco settlement
agreement.

Lori R. Fife, Esq., at Weil, Gotshal & Manges LLP, in New York,
explains that absent authorization to enter into and implement
the Settlement Agreement, the Debtors and Cisco might require
extensive judicial intervention to resolve their disputes.  The
litigation would involve a detailed and complex evidentiary
battle over the interpretation of each contract and the Parties'
course of dealing.  It would require discovery, including
document production and numerous depositions.

"Such litigation would be costly, time-consuming, and distracting
to management and employees alike.  The complexity, risks and
costs of the litigation and the attendant expenses,
inconvenience, and delay for the Debtors outweigh the probability
of success," Ms. Fife tells Judge Gonzalez.

Ms. Fife notes that the Settlement Agreement allows the parties
to continue their long-standing business relationship.  Ms. Fife
contends that the modified SIA and GMPA will benefit the Debtors
in a number of ways.  The Debtors will be able to continue to
obtain highly sophisticated telecommunications equipment and
services from Cisco on favorable economic terms.  The defaults
and disputes between the parties under the Agreements will be
resolved at a reduced cost to the Debtors.  The Debtors will get
better credit terms with Cisco and continue the reseller
arrangements under the SIA, which represents a significant source
of revenue. (Worldcom Bankruptcy News, Issue No. 34; Bankruptcy
Creditors' Service, Inc., 609/392-0900)


WYNN RESORTS: Boone Wayson Joins Company's Board of Directors
-------------------------------------------------------------
Wynn Resorts, Limited (NASDAQ: WYNN) has increased the size of its
Board of Directors to 10 by appointing D. Boone Wayson as an
additional director to serve on its Board of Directors. Mr. Wayson
participated in Wynn Resorts' Board of Directors' meeting today
immediately after accepting his appointment. In addition to his
service as a member of the Board of Directors, Mr. Wayson will
serve on the Nominating and Corporate Governance Committee of the
Board of Directors.

D. Boone Wayson has been a Principal of Wayson's Properties, Inc.,
a real estate development and holding company since 1970. He also
serves as an Officer and/or Director of Wayson's Properties, Inc.,
Boone Estates, Inc., 3-W Inc., Venture Farms, Inc., and Double
Paces Stable, Inc. From 2000 through May 2003, Mr. Wayson served
as a Member of the Board of Directors of MGM Mirage and from 1987
through May 2000, served as a Member of the Board of Directors of
Mirage Resorts. Mr. Wayson also served as President and Chief
Executive Officer of the Golden Nugget Atlantic City from 1984
until its sale in 1987.

                         *     *     *

As reported in Troubled Company Reporter's August 1, 2003 edition,
Standard & Poor's Ratings Services assigned its 'CCC+' rating to
Wynn Resorts Ltd.'s $250 million 6% convertible subordinated
debentures due July 15, 2015. Proceeds from the notes will be used
to help finance the company's Macau project and for general
corporate purposes, including the contribution of approximately
$44 million to Wynn Resorts Funding, LLC, a wholly-owned
subsidiary, to purchase U.S. government securities for the payment
of the first three years of scheduled interest payments on the
notes.

In addition, a 'B' corporate credit rating was assigned to the
company. The outlook is developing. Wynn Resorts, a holding
company with no operations of its own, was formed in 2002. The
company's primary efforts, through its subsidiaries, have been
focused on designing and developing two casino resorts: one on the
Las Vegas Strip (Wynn Las Vegas) and the other in Macau (Wynn
Macau S.A.).

Standard & Poor's currently maintains a 'B' corporate credit
rating on the Las Vegas subsidiary, Wynn Las Vegas, LLC. With no
operations, Wynn Resorts is dependent upon its subsidiaries to
fund its debt service obligations, including the newly issued
subordinated debentures.


ZALE CORP: Betsy Burton Elected to Board of Directors
-----------------------------------------------------
Zale Corporation (NYSE:ZLC), the largest specialty retailer of
fine jewelry in North America, has elected Betsy Burton to its
Board of Directors.

Ms. Burton, 51, is Chief Executive Officer of BB Capital, Inc., a
retail advisory and consulting company she formed in 1992. She was
formerly Chief Executive Officer of Supercuts, Inc. from 1987 to
1991.

Ms. Burton currently serves on the boards of Staples, Inc., The
Sports Authority, Inc., Aeropostale, Inc. and Rent-A-Center, Inc.

"Betsy is a veteran retailer with 25 years experience in
marketing, product development and planning," commented Glen
Adams, Chairman of the Zale Nominating Committee. "Her expertise
in a diverse range of retail venues will make Betsy a significant
contributor to the Zale board. We're very pleased to have her as
a member of our team."

Zale Corporation is North America's largest specialty retailer of
fine jewelry operating approximately 2,235 retail locations
throughout the United States, Canada and Puerto Rico, as well as
online. Zale Corporation's brands include Zales Jewelers, Zales
Outlet, Zale Direct at http://www.zales.com Gordon's Jewelers,
Bailey Banks & Biddle Fine Jewelers, Peoples Jewellers, Mappins
Jewellers and Piercing Pagoda. Additional information on Zale
Corporation and its brands is available on the Internet at
http://www.zalecorp.com

                            *   *   *

As recently reported, Standard & Poor's Ratings Services lowered
its long-term corporate credit rating on the specialty jewelry
retailer Zale Corp. to 'BB+' from 'BBB-'.

At the same time, Standard & Poor's withdrew its 'BBB-' senior
unsecured debt ratings on Zale's $87 million outstanding 8.5%
senior unsecured notes due 2007 and $225 million unsecured
revolving credit facility. The rating withdrawal follows the
company's announcement that it redeemed the senior notes and
refinanced the revolving credit facility with a new $500 million
secured revolving credit facility. All ratings have been removed
from CreditWatch where they were placed July 2, 2003. The outlook
is stable. About $87 million of total debt was outstanding at
April 30, 2003.

The downgrade follows Zale's announcement of the results of its
"Dutch Auction" tender offer that expired July 29, 2003. In
conjunction with the tender, Irving, Texas-based Zale intends to
purchase 4.7 million shares of its common stock at a total cost of
$225.6 million. Zale had previously expected to purchase up to 6.4
million shares at an aggregate amount of about $307 million.


ZI CORP: Pursuing Talks with Lancer Receiver re Held Shares
-----------------------------------------------------------
Zi Corporation (Nasdaq: ZICA) (TSX: ZIC), a leading provider of
intelligent interface solutions, issued a summary of the
information it has concerning the Lancer Group and how many shares
of the Company's stock are held by Lancer and its affiliated
entities.

In early July of this year, a U.S. federal judge froze the assets
of certain Lancer funds and appointed an attorney in the law firm
of Hunton & Williams, LLP as receiver for Lancer Management Inc.

The Company's attorneys have been in contact with the Lancer
receiver seeking clarification as to Lancer's holdings in Zi
Corporation.  According to the Company's attorneys, the receiver
has expressed a willingness to provide information about the
Lancer ownership position in Zi Corporation as soon as it can
reliably be obtained by the receiver.  As of August 8, 2003 the
receiver said that they had been unable to verify the extent of
the Lancer position in Zi.

Since the vast majority of the shares of Zi Corporation are held
in investment dealer book entry form and not in registered form,
the actual beneficial ownership position of a shareholder can only
be provided by the individual beneficial owner of stock.
According to transfer agent records of Zi's registered
shareholders, the Lancer entities and their affiliates are
registered owners of 245,000 shares of Zi stock; therefore, the
accounting for the balance of the Lancer share ownership position
in Zi Corporation must come from the receiver of Lancer.

Zi Corporation's Annual Report on Form 20F filed with the U.S.
Securities and Exchange Commission for the year 2001, based on
information provided by Lancer, disclosed that Lancer and its
affiliated companies held or controlled directly or beneficially
Zi Corporation stock totalling 3,675,100, which represented
approximately 9.67 percent ownership in Zi.

In the course of preparing its Annual Report on Form 20F for the
year 2002, Zi Corporation management observed what appeared to be
a concentration of its shares held at a major brokerage firm.  Zi
Corporation management requested that its attorneys obtain an
update from Lancer concerning the level of Lancer ownership in Zi
Corporation, but despite several requests, did not receive a
response.

Accordingly, the Company reported in its Form 20F for 2002, dated
May 15, 2003, the information about Lancer's share ownership in
Zi that was disclosed in its 2001 Form 20F and also disclosed in
the 2002 Form 20F that it had been unable to obtain current
information regarding Lancer's holdings and that its holdings may
be greater or less than reported.

The Company will continue to seek information from the receiver of
Lancer and will provide such information as soon as it is
received.

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.


* FTI Consulting Inks Pact to Sell SEA Group Assets for $16 Mil.
----------------------------------------------------------------
FTI Consulting, Inc. (NYSE: FCN), the premier national provider of
turnaround, bankruptcy and litigation-related consulting services,
has entered into a definitive agreement with the senior management
of its SEA practice group to sell the assets and liabilities of
the SEA practice group for $16.0 million. The transaction is
expected to close on or about August 31, 2003.

The sale of SEA will complete the disposition of FTI's former
Applied Sciences group, the results of which have been presented
as discontinued operations in FTI's financial statements as of
June 30, 2003. Effective upon the closing date, FTI will receive
cash consideration of $10.0 million, which will be used to reduce
the outstanding balance under FTI's existing term loan, as well as
a promissory note from the buyer in the amount of $6.0 million, to
be paid over seven years, with interest payable monthly at 9.0
percent per annum and principal payable monthly beginning in the
fourth year.

The sales price of $16.0 million is consistent with FTI's
conclusion that a $16.0 million sales price approximated the net
carrying value of the assets less assumed liabilities of the group
after providing for a $3.0 million loss from the sale of
discontinued operations in its second quarter 2003 financial
results as described in its press release of July 23, 2003 and
included in a Form 8-K filed with the Securities Exchange
Commission. As a consequence of the transaction being structured
as a sale of assets, FTI is expected to incur income taxes of
approximately $3.4 million and other transaction-related costs
estimated to be $0.6 million upon the sale. The total of $4.0
million, or $0.09 per share, will be included as additional loss
from sale of discontinued operations in FTI's financial results
for the second quarter of 2003 and will be recorded and discussed
further in FTI's Form 10-Q for the second quarter of 2003, which
will be filed on or prior to August 14, 2003.

FTI Consulting is a multi-disciplined consulting firm with leading
practices in the areas of turnaround, bankruptcy and litigation-
related consulting services. Modern corporations, as well as those
who advise and invest in them, face growing challenges on every
front. From a proliferation of "bet-the-company" litigation to
increasingly complicated relationships with lenders and investors
in an ever-changing global economy, U.S. companies are turning
more and more to outside experts and consultants to meet these
complex issues. FTI is dedicated to helping corporations, their
advisors, lawyers, lenders and investors meet these challenges by
providing a broad array of the highest quality professional
practices from a single source.


* Meetings, Conferences and Seminars
------------------------------------
September 18-21, 2003
   AMERICAN BANKRUPTCY INSTITUTE
      Southwest Bankruptcy Conference
         The Venetian, Las Vegas, NV
            Contact: 1-703-739-0800 or http://www.abiworld.org

September 12, 2003
   AMERICAN BANKRUPTCY INSTITUTE
      ABI/GULC "Views from the Bench"
         Georgetown Univ. Law Center, Washington, DC
            Contact: 1-703-739-0800 or http://www.abiworld.org

October 2-3, 2003
   EUROFORUM INTERNATIONAL
      European Securitisation
         Hilton London Green Park
            Contact: http://www.euro-legal.co.uk

October 10 and 11, 2003
   AMERICAN BANKRUPTCY INSTITUTE
      Symposium on 25th Anniversary of the Bankruptcy Code
         Georgetown Univ. Law Center, Washington, DC
            Contact: 1-703-739-0800 or http://www.abiworld.org

October 15-18, 2003
   NATIONAL CONFERENCE OF BANKRUPTCY JUDGES
      Seventy Sixth Annual Meeting
         San Diego, CA
            Contact: http://www.ncbj.org/

October 16-17, 2003
   EUROFORUM INTERNATIONAL
      Russian Corporate Bonds
         Renaissance Hotel, Moscow
            Contact: http://www.ef-international.co.uk

November 12-14, 2003
   AMERICAN BANKRUPTCY INSTITUTE
      Litigation Skills Symposium
         Emory University, Atlanta, GA
            Contact: 1-703-739-0800 or http://www.abiworld.org

December 1-2, 2003
   RENAISSANCE AMERICAN MANAGEMENT, INC.
      Distressed Investing
         The Plaza Hotel, New York City, NY
            Contact: 800-726-2524 or
                     http://renaissanceamerican.com

December 3-7, 2003
   AMERICAN BANKRUPTCY INSTITUTE
      Winter Leadership Conference
         La Quinta, La Quinta, California
            Contact: 1-703-739-0800 or http://www.abiworld.org

February 5-7, 2004
   AMERICAN BANKRUPTCY INSTITUTE
      Rocky Mountain Bankruptcy Conference
         Westin Tabor Center, Denver, CO
            Contact: 1-703-739-0800 or http://www.abiworld.org

March 5, 2004
   AMERICAN BANKRUPTCY INSTITUTE
      Bankruptcy Battleground West
         The Century Plaza, Los Angeles, CA
            Contact: 1-703-739-0800 or http://www.abiworld.org

April 15-18, 2004
   AMERICAN BANKRUPTCY INSTITUTE
      Annual Spring Meeting
         J.W. Marriott, Washington, D.C.
            Contact: 1-703-739-0800 or http://www.abiworld.org

April 29-May 1, 2004
   ALI-ABA
      Partnerships, LLCs, and LLPs: Uniform Acts, Taxation,
         Drafting, Securities, and Bankruptcy
            Fairmont Hotel, New Orleans
               Contact: 1-800-CLE-NEWS or http://www.ali-aba.org

May 3, 2004
   AMERICAN BANKRUPTCY INSTITUTE
      New York City Bankruptcy Conference
         Millennium Broadway Conference Center, New York, NY
            Contact: 1-703-739-0800 or http://www.abiworld.org

June 2-5, 2004
   AMERICAN BANKRUPTCY INSTITUTE
      Central States Bankruptcy Workshop
         Grand Traverse Resort, Traverse City, MI
            Contact: 1-703-739-0800 or http://www.abiworld.org

June 24-26,2004
   AMERICAN BANKRUPTCY INSTITUTE
      Hawaii Bankruptcy Workshop
         Hyatt Regency Kauai, Kauai, Hawaii
            Contact: 1-703-739-0800 or http://www.abiworld.org

July 15-18, 2004
   AMERICAN BANKRUPTCY INSTITUTE
      The Mount Washington Hotel
         Bretton Woods, NH
            Contact: 1-703-739-0800 or http://www.abiworld.org

July 28-31, 2004
   AMERICAN BANKRUPTCY INSTITUTE
      Southeast Bankruptcy Workshop
         The Ritz-Carlton Reynolds Plantation, Lake Oconee, GA
            Contact: 1-703-739-0800 or http://www.abiworld.org

September 18-21, 2004
   AMERICAN BANKRUPTCY INSTITUTE
      Southwest Bankruptcy Conference
         The Bellagio, Las Vegas, NV
            Contact: 1-703-739-0800 or http://www.abiworld.org

October 10-13, 2003
   NATIONAL CONFERENCE OF BANKRUPTCY JUDGES
      Seventy Seventh Annual Meeting
         Nashville, TN
            Contact: http://www.ncbj.org/

December 2-4, 2004
   AMERICAN BANKRUPTCY INSTITUTE
      Winter Leadership Conference
         Marriott's Camelback Inn, Scottsdale, AZ
            Contact: 1-703-739-0800 or http://www.abiworld.org

April 28- May 1, 2005
   AMERICAN BANKRUPTCY INSTITUTE
      Annual Spring Meeting
         J.W. Marriot, Washington, DC
            Contact: 1-703-739-0800 or http://www.abiworld.org

July 14 -17, 2005
   AMERICAN BANKRUPTCY INSTITUTE
      Ocean Edge Resort, Brewster, MA
         Contact: 1-703-739-0800 or http://www.abiworld.org

July 27- 30, 2005
   AMERICAN BANKRUPTCY INSTITUTE
      Southeast Bankruptcy Workshop
         Kiawah Island Resort and Spa, Kiawah Island, SC
            Contact: 1-703-739-0800 or http://www.abiworld.org

November 2-5, 2005
   NATIONAL CONFERENCE OF BANKRUPTCY JUDGES
      Seventy Eighth Annual Meeting
         San Antonio, TX
            Contact: http://www.ncbj.org/

December 1-3, 2005
   AMERICAN BANKRUPTCY INSTITUTE
      Winter Leadership Conference
         Hyatt Grand Champions Resort, Indian Wells, CA
            Contact: 1-703-739-0800 or http://www.abiworld.org

The Meetings, Conferences and Seminars column appears in the
Troubled Company Reporter each Wednesday.  Submissions via
e-mail to conferences@bankrupt.com are encouraged.

                          *********

Monday's edition of the TCR delivers a list of indicative prices
for bond issues that reportedly trade well below par.  Prices are
obtained by TCR editors from a variety of outside sources during
the prior week we think are reliable.  Those sources may not,
however, be complete or accurate.  The Monday Bond Pricing table
is compiled on the Friday prior to publication.  Prices reported
are not intended to reflect actual trades.  Prices for actual
trades are probably different.  Our objective is to share
information, not make markets in publicly traded securities.
Nothing in the TCR constitutes an offer or solicitation to buy or
sell any security of any kind.  It is likely that some entity
affiliated with a TCR editor holds some position in the issuers'
public debt and equity securities about which we report.

Each Tuesday edition of the TCR contains a list of companies with
insolvent balance sheets whose shares trade higher than $3 per
share in public markets.  At first glance, this list may look like
the definitive compilation of stocks that are ideal to sell short.
Don't be fooled.  Assets, for example, reported at historical cost
net of depreciation may understate the true value of a firm's
assets.  A company may establish reserves on its balance sheet for
liabilities that may never materialize.  The prices at which
equity securities trade in public market are determined by more
than a balance sheet solvency test.

A list of Meetings, Conferences and Seminars appears in each
Wednesday's edition of the TCR. Submissions about insolvency-
related conferences are encouraged. Send announcements to
conferences@bankrupt.com.

Bond pricing, appearing in each Thursday's edition of the TCR, is
provided by DebtTraders in New York. DebtTraders is a specialist
in global high yield securities, providing clients unparalleled
services in the identification, assessment, and sourcing of
attractive high yield debt investments. For more information on
institutional services, contact Scott Johnson at 1-212-247-5300.
To view our research and find out about private client accounts,
contact Peter Fitzpatrick at 1-212-247-3800. Real-time pricing
available at http://www.debttraders.com/

Each Friday's edition of the TCR includes a review about a book of
interest to troubled company professionals. All titles are
available at your local bookstore or through Amazon.com. Go to
http://www.bankrupt.com/books/to order any title today.

For copies of court documents filed in the District of Delaware,
please contact Vito at Parcels, Inc., at 302-658-9911. For
bankruptcy documents filed in cases pending outside the District
of Delaware, contact Ken Troubh at Nationwide Research &
Consulting at 207/791-2852.

                          *********

S U B S C R I P T I O N   I N F O R M A T I O N

Troubled Company Reporter is a daily newsletter co-published by
Bankruptcy Creditors' Service, Inc., Trenton, NJ USA, and Beard
Group, Inc., Washington, DC USA. Yvonne L. Metzler, Bernadette C.
de Roda, Donnabel C. Salcedo, Ronald P. Villavelez and Peter A.
Chapman, Editors.

Copyright 2003.  All rights reserved.  ISSN: 1520-9474.

This material is copyrighted and any commercial use, resale or
publication in any form (including e-mail forwarding, electronic
re-mailing and photocopying) is strictly prohibited without prior
written permission of the publishers.  Information contained
herein is obtained from sources believed to be reliable, but is
not guaranteed.

The TCR subscription rate is $675 for 6 months delivered via e-
mail. Additional e-mail subscriptions for members of the same firm
for the term of the initial subscription or balance thereof are
$25 each.  For subscription information, contact Christopher
Beard at 240/629-3300.

                *** End of Transmission ***