TCR_Public/040712.mbx         T R O U B L E D   C O M P A N Y   R E P O R T E R

             Monday, July 12, 2004, Vol. 8, No. 142

                           Headlines

AAIPHARMA INC: Regains Nasdaq Listing Compliance
ADELPHIA COMMS: Wants to Employ Kirkpatrick & Lockhart
ADESA INC: Schedules Second Quarter Earnings Release
AIR CANADA: Judge James Farley Approves Agreement with Airbus
AIR CANADA: CUPE Ratifies New Collective Agreement

ALARIS MEDICAL: Commences Tender Offer for 7-1/4% Sr. Sub. Notes
ALLEGHENY TECHNOLOGIES: Names New Board Committee Appointments
ARMSTRONG HOLDINGS: Court Allows Extension To File Notices
BELVIDERE BAY LLC: Case Summary & 17 Largest Unsecured Creditors
BIP INTERNTIONAL: Case Summary & 11 Largest Unsecured Creditors

BRIDGE TECHNOLOGY: Section 341(a) Meeting Slated for July 29
BURNS EQUIPMENT: Case Summary & 4 Largest Unsecured Creditors
CANDESCENT TECH: First Meeting of Creditors Fixed for July 14
CHALK MEDIA: Signs Deal With Quebecor Unit Groupe Archambault
COLLINS & AIKMAN: Releases Preliminary Q2 2004 Operating Results

CORAL REEF RESTAURANT: Voluntary Chapter 11 Case Summary
CORNING INC: Sells Frequency Control Business to Vectron Int'l
CRITICAL PATH: OTC Lists Rights to Purchase E Preferred Stock
DII INDUSTRIES: Hires Jenkens & Gilchrist for Litigation Work
DOLLAR GENERAL: Reports $715.6 Million Retail Sales in June

ENDURANCE SPECIALTY: Prices $250 Million 7% Sr. Debt Offering
ENRON CORP: Judge Gonzales Won't Nix Plan Negotiation Language
EQUIFIN INC: AMEX to Move for Delisting of Company's Common Stock
FLEMING COMPANIES: Court Denies CHEP's Prelim Injunction Request
FOUNDATION COAL: S&P Assigns BB- Corporate Credit Rating

GE CAPITAL: Fitch Affirms Low-B Ratings of 6 GECMC 2001-3 Classes
GLOBAL WATER: U.S. Bankruptcy Court Confirms Reorganization Plan
GMAC COMMERCIAL: Fitch Affirms Low-B Ratings of 7 2002-C3 Classes
HAWAIIAN HOLDINGS: AFA Opposes Hawaiian Airlines Bonus Plan
HERCULES INC: Names Charles Wardlaw VP & Chief Procurement Officer

HEXCEL CORP: S&P Revises Outlook To Positive From Stable
HOLLINGER INTERNATIONAL: Extends Consent Payment Deadline
HORIZON LINES: Carlyle Closes $650 Million Sale to Castle Harlan
HUDSON RESPIRATORY: Teleflex Inc. Completes Senior Note Financing
INTERSTATE BAKERIES: Names Ronald B. Hutchison EVP and CFO

KAISER ALUMINUM: Court Okays Payment To Century & Noranda
JEFFWERBERPETS INC: Case Summary & 20 Largest Unsecured Creditors
KROLL INC: Adopts Merger Agreement with Marsh & McLennan Companies
LES BOUTIQUES: National Bank Financial Recommends Modified Offer
LES BOUTIQUES: Noteholders Approve Amended Plan of Compromise

LIBERATE TECH: Bankruptcy Case Transferred to San Francisco
MCMILLIN COS: S&P Assigns B+ Rating to Corporate Credit
MEDIABAY INC: Names Yarvis and Neuwirth as Independent Directors
MERRY-GO-ROUND: Trustee Hires Tom Hays as Turnaround Expert
MERRILL LYNCH: Fitch Affirms Classes H & J's Junk Ratings

MIRAVANT: Demands Immediate Delisting From Berlin Stock Exchange
MORGANS HOTEL: Completes Sale of 90% Interest in Paramount Hotel
NETWORK INSTALLATION: Relocates Corporate HQ to Irvine, California
NEWAVE INC: Partners With IDI Global to Accelerate Current Growth
NEXEN INC: Sets Second Quarter 2004 Earnings and Conference Call

NEXTEL FINANCE: S&P Rates $6.2 Billion Credit Facility at BB+
NEXTWAVE: Auction Attracts Winning Bids Totaling $973.5 Million
NORTHWESTERN: Inks Pact with MPSC and MCC on Reorganization Plan
NRG ENERGY: Asks Court To Approve Amended Thomassen Agreement
OMI CORP: Will Not Pursue Stelmar Transaction

ONE EQUESTRIAN: Case Summary & 3 Largest Unsecured Creditors
PACIFIC GAS: Resolves Chevron Claim Disputes
PARMALAT GROUP: Judge Drain Approves Interim Co-Pack Agreement
PEGASUS SATELLITE: Court Okays Employment of Professionals
PER-SE TECHNOLOGIES: Will Report Q2 2004 Earnings on August 4

PIVOTAL SELF: Closes Acquisition of Phantom Fiber Corporation
RESIDENTIAL ASSET: Fitch Downgrades Class B Ratings to B
REVLON INC: Offering $1,122.24 for Each $1,000 12% Senior Note
SINCLAIR BROADCAST: S&P Assigns BB Ratings To Term Loans
SPIEGEL GROUP: Judge Allows Purchase Agreement with Newport News

SPIEGEL GROUP: Reports $124.1 Million Net Sales in June 2004
SR TELECOM: Subsidiary Launches Expanded Commercial Operations
TALCOTT NOTCH: Fitch Affirms Low-B Ratings of Classes A-4 & B-1
TESORO PETROLEUM: Fitch Upgrades 4 Low-B Debt Ratings
TITAN CORP: Releases Preliminary Results for Second Quarter 2004

TOWER AUTOMOTIVE: Opens New Joint-Venture Facility in China
TSI TELSYS: Wins New Order for Turnkey RF System
UNITED AIRLINES: Court Okays Marr Hipp as Special Labor Counsel
WACHOVIA BANK: Fitch Affirms Low-B Ratings of 6 2004-C12 Classes
WORLDCOM INC: Judge Gonzalez Rules KPMG Won't Be Disqualified

W.R. GRACE: Futures Rep. Taps Phillips Goldman & Spence as Counsel
Y-USA INC: Case Summary & 8 Largest Unsecured Creditors

* Ballenger, Cleveland & Issa Expands Into High Growth Market

* BOND PRICING: For the week of July 12 - July 16, 2004

                           *********

AAIPHARMA INC: Regains Nasdaq Listing Compliance
------------------------------------------------
aaiPharma Inc. (Nasdaq: AAIIE) received notification from Nasdaq
that the Company has evidenced compliance with the current
requirements necessary for continued listing on The Nasdaq
National Market. Effective with the open of business on Friday,
July 9, 2004 the Company's ticker symbol will revert to AAII.

                    About aaiPharma Inc.  

aaiPharma Inc. is a science-based pharmaceutical Company focused  
on pain management, with corporate headquarters in Wilmington,  
North Carolina. With more than 24 years of drug development  
expertise, the Company is focused on developing, acquiring, and  
marketing branded medicines in its targeted therapeutic areas.  
aaiPharma's development efforts are focused on developing improved  
medicines from established molecules through its significant  
research and development capabilities.  

                         *     *     *

As reported in the Troubled Company Reporter's April 29, 2004  
edition, Standard & Poor's Ratings Services affirmed its 'CCC'  
corporate credit and 'CC' subordinated debt ratings on aaiPharma  
Inc. At the same time, Standard & Poor's removed the ratings on  
the Wilmington, North Carolina-based specialty pharmaceutical  
company from CreditWatch.

The outlook on aaiPharma is negative.

"The low speculative-grade ratings reflect the company's improved  
but still limited liquidity given the lack of visibility of  
aaiPharma's profitability and cash flow generation," said Standard  
& Poor's credit analyst Arthur Wong.

For more information on the Company, including its product  
development organization AAI Development Services, visit  
aaiPharma's website at http://www.aaipharma.com/  


ADELPHIA COMMS: Wants to Employ Kirkpatrick & Lockhart
------------------------------------------------------
Adelphia Communications Corp. and its debtor-affiliates asks the
U.S. Bankruptcy Court for the Southern District of New York for
authority to employ Kirkpatrick & Lockhart, LLP.  The law firm
will represent the Debtors in labor and employment, real estate
and other litigation matters.

Since July 25, 2002, the ACOM Debtors employed Kirkpatrick as an
ordinary course professional.  Due to the volume of labor matters
that arose in the conduct of their businesses, the ACOM Debtors
determined that it is necessary to expand Kirkpatrick's role and
employ it as special counsel.

Kirkpatrick, a firm with diverse practice, is one of the 50
largest law firms in the United States.  It acquired national
prominence in numerous practice areas, including investment
management, securities enforcement, labor and employment, and
insurance coverage.  In addition to its main office in
Pittsburgh, Kirkpatrick has offices in Boston, Dallas,
Harrisburg, Miami, New York, Newark, San Francisco, Los Angeles,
and Washington, D.C.  Kirkpatrick has extensive expertise in
representing clients in various labor matters, including
collective bargaining negotiations, arbitrations and National
Labor Relations Board proceedings.

Kirkpatrick will provide legal representation to the ACOM Debtors
in their Chapter 11 cases, including, but not limited to:

   (1) general advice and counseling on employment and labor-
       related issues;

   (2) representation on various labor matters, including
       collective bargaining negotiations, arbitrations, and NLRB
       proceedings; and

   (3) general representation, as requested by the ACOM Debtors,
       in connection with real estate matters, including, but not
       limited to, review and analysis of purchase and sale
       agreements, leases, and title matters.

According to Shelley C. Chapman, Esq., at Willkie Farr &
Gallagher, LLP, in New York, the ACOM Debtors require
knowledgeable attorneys to handle complicated labor and
employment areas and those with extensive understanding of the
ACOM Debtors' businesses.  Kirkpatrick is well qualified to
perform these services for the ACOM Debtors.

In consideration for its services, Kirkpatrick will be
compensated on an hourly basis, plus reimbursement of actual and
necessary expenses incurred:

            Attorneys                     $180 - 550
            Paralegals                     110 - 180

All of Kirkpatrick's rates are subject to periodic, ordinary
course adjustments.  The attorneys and paralegals involved in the
ACOM Debtors' cases will likely span Kirkpatrick's rate ranges.

According to Kirkpatrick's books and records:

   -- in the 90 days prior to the Petition Date, the firm
      received $64,000 from the ACOM Debtors and has outstanding
      claims for $59,000; and

   -- from the Petition Date, Kirkpatrick has received $305,700
      in compensation for services rendered and expenses incurred
      pursuant to the orders approving the employment of ordinary
      course professional and is owed $269,000 in both billed and
      unbilled fees and expenses through April 2004.

Thomas H. Petrides, Esq., a Kirkpatrick partner, discloses that
the firm:

   -- does not represent any party, or hold any interest, adverse
      to the ACOM Debtors with respect to the matters on which it
      is to be retained; and

   -- has no connection with any of the potential parties-in-
      interest that would affect its ability to represent the
      ACOM Debtors in their Chapter 11 cases.

To the extent that many of Kirkpatrick's clients might have
claims against the ACOM Debtors, Mr. Petrides assures the Court
that they would not represent that client in pursuing the
claims.(Adelphia Bankruptcy News, Issue No. 63; Bankruptcy
Creditors' Service, Inc., 215/945-7000)


ADESA INC: Schedules Second Quarter Earnings Release
----------------------------------------------------
ADESA, Inc. (NYSE: KAR) will announce its financial results for
the quarter ended June 30, 2004 immediately after the financial
markets close on Wednesday, July 21, 2004.

Following the release, ADESA Chairman and CEO David Gartzke and
ADESA Chief Financial Officer Cam Hitchcock will present an
overview of financial results and other factors affecting
performance during a conference call beginning at 4:30 p.m. EST.

Also on the call, ALLETE President and CEO Don Shippar and
ALLETE Chief Financial Officer James Vizanko will present an
overview of ALLETE, Inc. (NYSE: ALE) financial results for the
quarter.  ALLETE is presently the controlling shareholder of
ADESA, Inc.

Interested parties may listen to the conference by calling (719)
457-2606 or by listening to a Webcast accessed either via the
ADESA Web site at http://www.adesainc.com/or the ALLETE Web site  
at http://www.allete.com/

With headquarters in Carmel, Indiana, ADESA is North America's
largest publicly traded provider of wholesale vehicle auctions and
the largest provider of used vehicle dealer floorplan financing.  
The company's holdings include 53 ADESA used vehicle auctions, 28
Impact salvage vehicle auctions, and 80 AFC loan production
offices across North America.  For further information on ADESA,
Inc. visit the company's Web site at http://www.adesainc.com/  

                         *     *     *

As reported in the Troubled Company Reporter, June 4, 2004 issue,
Standard & Poor's Rating Services assigned its 'B+' rating to
ADESA Inc.'s proposed $125 million senior subordinated notes due
2012, and affirmed its 'BB' corporate credit and senior secured
ratings on the Carmel, Indiana-based operator of wholesale used-
vehicle auctions and provider of used-vehicle floorplan financing.
The outlook is stable.  


AIR CANADA: Judge James Farley Approves Agreement with Airbus
-------------------------------------------------------------
Mr. Justice James Farley of the Ontario Superior Court approved on
Friday March 19, 2004 the agreement between Airbus and Air Canada
dated March 12, 2004 with respect to aircraft that have been
ordered but were undelivered at the time of CCAA filing.  The
agreement provides for the purchase of two ultra-long-range
widebody Airbus A340-500s, and their financing.  The settlement
also includes the cancellation of two narrowbody Airbus A321
deliveries and the deferred delivery to 2010 of three 350-seat
widebody A340-600s with unilateral cancellation rights in favor of
Air Canada.  As part of the settlement, Airbus has agreed to waive
any claim against Air Canada during the CCAA process.

The purchase of these two A340-500 aircraft has been agreed to by
Trinity Time Investments, Air Canada's equity plan sponsor.

The Applicants intend to sell certain buyer furnished equipment
relating to two A340-500 aircraft, free and clear of charges
created by the Initial CCAA Order.

Air Canada and AVSA S.A.R.L. were parties to three aircraft
purchase agreements, including the A340-500/600 Purchase
Agreement dated April 7, 1998, as amended.  The A340-500/600
Purchase Agreement related to, among other things, Air Canada's
acquisition of a number of aircraft, including the two A340-500
Aircraft.  Under the A340-500/600 Purchase Agreement, the
Aircraft were scheduled to be delivered to Air Canada in April
and May 2003.

As contemplated by the A340-500/600 Purchase Agreement, Air
Canada furnished to AVSA the BFE so that it could be installed on
the Aircraft before their delivery to Air Canada.  Most of the
items comprising the BFE were delivered to AVSA before April 1,
2003.  However, title to the BFE remains with Air Canada.

After the Petition Date, Air Canada did not take delivery of the
Aircraft in April and May 2003, as contemplated by the A340-
500/600 Purchase Agreement.

In the context of the aircraft lease restructurings carried out
by the airline, Air Canada and AVSA agreed to restructure the
three aircraft purchase agreements, including the A340-500/600
Purchase Agreement, pursuant to a Memorandum of Understanding
dated March 12, 2004 and a Term Sheet for the Provision of
Certain Financing Support dated March 12, 2004.  The MOU and the
Term Sheet provide for the purchase of the Aircraft by Air
Canada, the financing by AVSA, and an option to purchase certain
other aircraft.  The CCAA Court approved the MOU and the Term
Sheet in March 2004.

According to Ashley John Taylor, Esq., at Stikeman Elliott, LLP,
the parties currently contemplate that, pursuant to the MOU and
Term Sheet, Airbus Financial Services will finance the
acquisition of the Aircraft by Air Canada from Bonaventure
Limited, a corporation established by AVSA or an affiliate of
AVSA for the purpose of acquiring the Aircraft and selling it to
Air Canada.  AVSA will sell the Aircraft, including the BFE
installed thereon, to Bonaventure and will arrange for a loan to
Bonaventure for the purpose of acquiring the Aircraft.  Airbus
Financial Services will receive security on the Aircraft to
secure the obligations of Bonaventure under the loan. Bonaventure
will sell the BFE-installed Aircraft to Air Canada by way of a
conditional sale agreement.

The delivery of the BFE-installed Aircraft to Bonaventure and
then to Air Canada is scheduled to take place in June and July
2004.  All of the BFE which was previously delivered to AVSA has
either been installed on the Aircraft or will be installed prior
to delivery of the Aircraft to Bonaventure.

Under the transaction documents, title to the entire Aircraft,
including the BFE, will pass to Air Canada upon payment of the
financed amount.  The financed amount is in respect of the net
price of the Aircraft, after application of certain deposits and
pre-delivery payments contemplated in the MOU and excludes the
cost of the BFE.  In a realization scenario any excess value in
the Aircraft above Air Canada's financing obligations will flow
back to Air Canada.

The approval of the MOU and Term Sheet was granted on the basis
that if Air Canada does not successfully emerge from the CCAA
proceedings, the estate would not be prejudiced by the approval
transaction other than to the extent of payments made during the
CCAA proceedings.  Mr. Taylor assures the Court that the sale of
the BFE would not further prejudice the estate in the event Air
Canada does not successfully emerge because the value of the BFE,
which is contemplated to be sold to AVSA for nominal
consideration, will be preserved through the mechanism of the
conditional sale agreement.

                         *      *      *

TheCourt approves the motion to provide that any future sale
of redundant or non-material assets will be free and clear of all
charges created by the Initial CCAA Order.

Headquartered in Saint-Laurent, Quebec Canada, Air Canada --
http://www.aircanada.ca/-- represents Canada's only major  
domestic and international network airline, providing scheduled
and charter air transportation for passengers and cargo. The
Company filed for CCAA protection on April 1, 2003 (Ontario
Superior Court of Justice, Case No. 03-4932) and Section 304
petition with the U.S. Bankruptcy Court for the Southern District
of New York (Case No. 03-11971).  Matthew A. Feldman, Esq., and
Elizabeth Crispino, Esq., at Willkie Farr & Gallagher serve as the
Debtors' U.S. Counsel.  When the Debtors filed for protection from
its creditors, they listed C$7,816,000,000 in assets and
C$9,704,000,000 in liabilities. (Air Canada Bankruptcy News, Issue
No. 40; Bankruptcy Creditors' Service, Inc., 215/945-7000)


AIR CANADA: CUPE Ratifies New Collective Agreement
--------------------------------------------------
Members of the Canadian Union of Public Employees voted to ratify
the new collective agreement negotiated between Air Canada and the
union representing its 6,500 flight attendants, said CUPE Air
Canada Component President Pamela Sachs.

Seventy per cent of members supported ratification. Voting
concluded at noon on July 8, 2004.

"This new collective agreement represents significant sacrifices
made by our members to once again save Air Canada," said Sachs.
"For two years in a row our members have voted to make concessions
out of their pockets while management attempts to walk away with a
bonus."

"It's time for a change. Our members expect their considerable
financial sacrifices to turn this airline around, not to fill
management's pockets. That is going to require change at the top.
We need to see a change in management's philosophy and toward the
people that make the airline work: its employees," said Sachs.

"Concessions from employees will not be enough to keep Air Canada
flying and to ensure it becomes the preeminent carrier it can be,"
concluded Sachs.

All of Air Canada's unionized employees reached new tentative
agreements with the airline following concessionary negotiations
in May. Air Canada said it needed to achieve concessions
negotiated by the unions in 2003 in order to successfully
restructure by securing a new financing deal and exiting
bankruptcy protection.

Headquartered in Saint-Laurent, Quebec Canada, Air Canada --
http://www.aircanada.ca/ -- represents Canada's only major  
domestic and international network airline, providing scheduled
and charter air transportation for passengers and cargo. The
Company filed for CCAA protection on April 1, 2003 (Ontario
Superior Court of Justice, Case No. 03-4932) and Section 304
petition with the U.S. Bankruptcy Court for the Southern District
of New York (Case No. 03-11971).  Matthew A. Feldman, Esq., and
Elizabeth Crispino, Esq., at Willkie Farr & Gallagher serve as the
Debtors' U.S. Counsel.  When the Debtors filed for protection from
its creditors, they listed C$7,816,000,000 in assets and
C$9,704,000,000 in liabilities.


ALARIS MEDICAL: Commences Tender Offer for 7-1/4% Sr. Sub. Notes
----------------------------------------------------------------
ALARIS Medical Systems, Inc. commenced a tender offer and consent
solicitation for any and all of ALARIS' $175.0 million principal
amount of 7-1/4 percent senior subordinated notes due 2011 (CUSIP
No. 011638AD5).  ALARIS is a wholly owned subsidiary of Cardinal
Health, Inc. (NYSE: CAH), the leading provider of products and
services supporting the health care industry.  

The tender offer and consent solicitation are being made pursuant
to an Offer to Purchase and Consent Solicitation Statement dated
July 7, 2004, and a related Letter of Transmittal, which provide
the terms and conditions of the tender offer and consent
solicitation.

In connection with the tender offer, ALARIS is soliciting consents
from holders of the ALARIS notes to amend the indenture that
governs the notes to eliminate or modify substantially all of the
restrictive covenants and many of the provisions defining an
"event of default." Consummation of the tender offer and consent
solicitation is subject to various conditions, including but not
limited to the receipt of the required consents in the consent
solicitation.

Under the notes indenture, ALARIS will have the right to exercise
the "equity claw" option for 35% of the outstanding notes. The
total consideration for this tender offer reflects the value of
this option. The tender offer and consent solicitation are
scheduled to expire at 12:00 midnight, eastern daylight time, on
August 3, 2004 unless extended or terminated earlier. Holders who
tender their notes on or before July 20, 2004 will receive "Total
Consideration" for each $1,000 principal amount of Notes equal to
the sum of (x) 35% of the "Equity Claw-Back Price" and (y) 65% of
the "Fixed Spread Price." The Equity Claw-Back Price is equal to
$1,072.50 per $1,000 principal amount of notes validly tendered.
The Fixed Spread Price is equal to the present value on August 3,
2004 of all future cash flows on the notes to July 1, 2007 (the
first date on which all notes may be redeemed at ALARIS' option),
as more fully described in the Offer to Purchase and Consent
Solicitation Statement. Holders tendering after the Consent
Payment Deadline will only receive Offer Consideration, which is
equal to the Total Consideration less the consent payment of
$30.00 per $1,000 principal amount of notes.

Holders who validly tender notes prior to the Consent Payment
Deadline will, by tendering those notes, be consenting to the
amendments to the notes indenture. Holders may not consent to the
amendments without tendering their notes and may not revoke their
consents without withdrawing the previously tendered notes to
which the consents relate. No tenders will be valid if submitted
after the Expiration Time. Holders who validly tender their notes
will also receive accrued and unpaid interest up to, but not
including, the settlement date.

                  About Cardinal Health

Cardinal Health, Inc. -- http://www.cardinal.com/-- is the  
leading provider of products and services supporting the health
care industry. Cardinal Health develops, manufactures, packages
and markets products for patient care; develops drug-delivery
technologies; distributes pharmaceuticals, medical- surgical and
laboratory supplies; and offers consulting and other services that
improve quality and efficiency in health care. Headquartered in
Dublin, Ohio, Cardinal Health employs more than 50,000 people on
six continents and produces annual revenues of more than $50
billion. Cardinal Health is ranked No. 17 on the 2004 Fortune 500
list and was named one of the best U.S. companies by Forbes
magazine for 2004.

            About ALARIS Medical Systems, Inc.

ALARIS Medical Systems, Inc. (NYSE:AMI) develops and markets
products for the safe delivery of intravenous medications.
Our IV medication and infusion therapy delivery systems, software
applications, needle-free disposables and related monitoring
equipment are marketed in the United States and internationally.
Our "smart" pumps, with the proprietary Guardrails Safety
Software, help to reduce the risks and costs of medication errors,
help to safeguard patients and clinicians and gather and record
clinical information for review, analysis and interpretation. We
provide our products, professional and technical support and
training services to over 5,000 hospital and health care systems,
as well as alternative care sites, in over 100 countries through
our direct sales force and distributors. Headquartered in San
Diego, California, we employ approximately 3,000 people worldwide.
Additional information on ALARIS Medical Systems can be found at
http://www.alarismed.com/

                     *   *   *

As reported in the Troubled Company Reporter's May 21, 2004
edition, Standard & Poor's Ratings Services placed its 'BB-'
corporate credit rating, its 'BB' senior secured bank loan rating,
and its 'B' subordinated debt rating on San Diego, California-
based ALARIS Medical Systems Inc. on CreditWatch with positive
implications.  

"The CreditWatch listing follows the announcement that Cardinal  
Health Inc., a large medical products distribution firm, will  
acquire the innovative manufacturer of medication safety products  
for $2 billion," said Standard & Poor's credit analyst Jill  
Unferth. Upon completion of the transaction, Cardinal is expected  
to assume ALARIS' debt, including its $175 million 7.25% senior  
subordinated notes due in 2011, and the ratings will be raised to  
levels consistent with Cardinal's credit quality. At March 31,  
2004, ALARIS had $338 million of debt outstanding.


ALLEGHENY TECHNOLOGIES: Names New Board Committee Appointments
--------------------------------------------------------------
Allegheny Technologies Incorporated (NYSE:ATI) named:

     * James E. Rohr, 55, Chairman of ATI's Audit Committee and

     * Diane C. Creel, 55, Chairman of ATI's Finance Committee.

Jim Rohr is Chairman and Chief Executive Officer of The PNC
Financial Services Group, Inc. Diane Creel is Chairman, Chief
Executive Officer and President of Ecovation Inc., a waste stream
technology company. Both Mr. Rohr and Ms. Creel have been
Directors of ATI since 1996.

Mr. Rohr and Ms. Creel replace Frank V. Cahouet, 72, who has
resigned from the Company's Board. Mr. Cahouet was Chairman,
President and Chief Executive Officer of Mellon Financial
Corporation prior to his retirement in 1998.

"Frank Cahouet has provided many valuable contributions during his
many years of service on the ATI Board," said Pat Hassey, ATI's
Chairman, President and Chief Executive Officer. "We thank him for
all that he has done and wish him well."

                     About the Company  

Allegheny Technologies Incorporated (NYSE:ATI) is one of the   
largest and most diversified specialty materials producers in the   
world, with revenues of approximately $1.9 billion in 2003. The   
Company has approximately 8,800 employees world-wide and its   
talented people use innovative technologies to offer growing   
global markets a wide range of specialty materials. High-value   
products include nickel-based and cobalt-based alloys and   
superalloys, titanium and titanium alloys, specialty steels,
super stainless steel, exotic alloys, which include zirconium,
hafnium and niobium, tungsten materials, and highly engineered
strip and Precision Rolled Stripr products. In addition, we
produce commodity specialty materials such as stainless steel
sheet and plate, silicon and tool steels, and forgings and
castings. The Allegheny Technologies website can be found at   
http://www.alleghenytechnologies.com/  

                       *   *   *  

As reported in the Troubled Company Reporter's December 29, 2003   
edition, Standard & Poor's Ratings Services lowered its ratings on  
Pittsburgh, Pennsylvania-based Allegheny Technologies Inc. The  
company's ratings remain on CreditWatch, where they were placed on  
Oct. 23, 2003 with negative implications.  
  
Standard & Poor's Ratings Services placed its ratings on
Allegheny Technologies Inc. (BB+ Corporate Credit Rating) on
CreditWatch with negative implications, reflecting the company's
continuing weak financial performance and heightened concerns that
lackluster demand from key markets and increased global
competitive pressures and high input costs will continue to more
than offset management's efforts to improve its weak credit
measures.  
  
In resolving the CreditWatch, Standard & Poor's will assess the  
company's prospects for improving its subpar profitability as well  
as its significant legacy liabilities in light of challenging  
stainless steel industry fundamentals.


ARMSTRONG HOLDINGS: Court Allows Extension To File Notices
----------------------------------------------------------
The Bankruptcy Court gave Armstrong World Industries, Inc., Nitram
Liquidators, Inc., and Desseaux Corporation of North America a
further extension of their time to file notices to remove
prepetition lawsuits and administrative proceedings, through and
including:

     (i) 30 days after the date on which an order confirming
         the Plan is entered by the United States District Court
         for the District of Delaware; or

    (ii) 30 days after entry of an order terminating the
         automatic stay with respect to any particular action
         sought to be removed.

Rebecca L. Booth, Esq., at Richards Layton & Finger, reminded
Judge Fitzgerald that the Debtors are parties to numerous judicial
and administrative proceedings currently pending before various
courts or administrative agencies throughout the country.  Due to
the number of proceedings involved, and the wide variety of claims
these proceedings present, the Debtors need more time to determine
which, if any, of the proceedings should be removed and, if
appropriate, transferred to this district.

At the time that the last extension was granted, the parties
anticipated that both Judge Newsome and District Judge Wolin would
preside jointly over a hearing on the confirmation of the Plan in
November 2003, and that the Debtors would emerge from bankruptcy
by the end of 2003 -- making any further extensions of the Removal
Deadline irrelevant.  In light of the changed circumstances, the
Debtors find it necessary to extend the Removal Period.  The
extension would protect the Debtors' valuable right to
economically adjudicate lawsuits if the circumstances warrant
removal.

The extension will not prejudice the Debtors' adversaries because
they may not prosecute the actions and proceedings pending relief
from the stay. Furthermore, the Debtors assure the Court that the
extension will not prejudice a party to a proceeding that the
Debtors seek to remove because the party may seek remand of any
removed action or proceeding.

Headquartered in Lancaster, Pennsylvania, Armstrong World
Industries, Inc. -- http://www.armstrong.com/-- the major  
operating subsidiary of Armstrong Holdings, Inc., designs,
manufactures and sells interior finishings, most notably floor
coverings and ceiling systems, around the world.  The Company
filed for chapter 11 protection on December 6, 2000 (Bankr. Del.
Case No. 00-04469).  Stephen Karotkin, Esq., Weil, Gotshal &
Manges LLP and Russell C. Silberglied, Esq., at Richards, Layton &
Finger, P.A., represent the Debtors in in their restructuring
efforts.  When the Debtors filed for protection from their
creditors, they listed $4,032,200,000 in total assets and
$3,296,900,000 in liabilities. (Armstrong Bankruptcy News, Issue
No. 63; Bankruptcy Creditors' Service, Inc., 215/945-7000)   


BELVIDERE BAY LLC: Case Summary & 17 Largest Unsecured Creditors
----------------------------------------------------------------
Debtor: Belvidere Bay LLC
        518 Broadway
        Libertyville, Illinois 60048

Bankruptcy Case No.: 04-25112

Chapter 11 Petition Date: July 6, 2004

Court: Northern District of Illinois (Chicago)

Judge: Jack B. Schmetterer

Debtor's Counsel: David J. Schwab, Esq.
                  Richards Ralph & Schwab, Chartered
                  175 East Hawthorn Parkway Suite 345
                  Vernon Hills, IL 60061
                  Tel: 847-367-9699

Estimated Assets: $1 Million to $10 Million

Estimated Debts:  $1 Million to $10 Million

Debtor's 17 Largest Unsecured Creditors:

Entity                        Nature Of Claim       Claim Amount
------                        ---------------       ------------
Kodiak Realty, Ltd.           Management Fee             $73,500

Lake County Collector         1st Half 2004 Real         $65,000
                              Estate Taxes

Com Ed                        Electric Utility            $3,500
                              Service

Mary Petersen Miracle         Daily Janitorial            $2,425
Cleaning                      Service

The Hartford                  Property and                  $700
                              Liability insurance

Greater Midwest Builders,     Miscellaneous                 $575
Inc.                          ongoing maintenance

People's Energy               Gas Utility Service           $500

Robinson Heating & Cooling,   HVAC Maintenance              $500
Inc.                          Service

Kodiak Realty, Ltd.           Misc. Supplies and            $500
                              Maintenance service

Joe Hashek                    Landscaping and snow          $400
                              plowing maintenance

Dam, Snell & Taveirne, Ltd.   Professional                  $400
                              Accounting Services

City of Park City             Water, Sewer and              $300
                              Inspection Fees

Groot Recycling & Waste       Disposal Service              $200
Services

Sholl Plumbing, Inc.          Plumbing Maintenance          $200
                              Service

Sterling Elevator Service     Elevator Maintenance          $125

SBC                           Fire Detection                $100
                              telephone line

North Shore Sanitary          Sewage Treatment               $50
District                      Service


BIP INTERNTIONAL: Case Summary & 11 Largest Unsecured Creditors
----------------------------------------------------------------
Debtor: BIP Interntional, Inc.
        dba Global Interior Group
        55 Old Turnpike Road, Suite 208
        Nanuet, New York 10954-2450

Bankruptcy Case No.: 04-23072

Type of Business: The Debtor is an importer, exporter, wholesaler
                  and general contractor for marine interior and
                  joiner systems products.

Chapter 11 Petition Date: July 8, 2004

Court: Southern District of New York (White Plains)

Debtor's Counsel: Harvey S. Barr, Esq.
                  Barr & Haas, LLP
                  664 Chestnut Ridge Road
                  P.O. Box 664
                  Spring Valley, NY 10977
                  Tel: 845-352-4080
                  Fax: 845-352-6777

Total Assets: $359,243

Total Debts:  $8,224,311

Debtor's 11 Largest Unsecured Creditors:

Entity                        Nature Of Claim       Claim Amount
------                        ---------------       ------------
Alpha GMBH & Co.              Disputed Damage         $4,353,685
Schiffsbesitz KG              Claim
Max Planck Strasse 3
5317 Bonn Germany

Alpha GMBH & Co.                                      $2,167,552
Schiffsbesitz KG
Max Planck Strasse 3
5317 Bonn Germany

BIP Industries Co., Ltd.      Purchases made for        $527,948
84-18 Guseo-dong,             various projects
Keumjeong-ku                  (2003 & 2004) -
Busan, Korea                  Trade account
                              payables

Alpha GMBH & Co.                                        $374,396
Schiffsbesitz KG
Max Planck Strasse 3
5317 Bonn Germany

BIP Industries Co., Ltd.      Corporate Loans           $374,396
84-18 Guseo-dong              (principal amount)
Keumjeong-ku
Busan, Korea

SungJu Co., Ltd.              Business Loan             $250,000

Anderson St. Dennis & Glen    Legal Fees                 $70,000
PA

Maritime and Technical        Dr. Reggio (expert         $52,180
Service                       witness) Services -
                              NY Arbitration
                              (Giant 1)

BIP Industries Co., Ltd.                                 $33,807

International Center for                                 $10,300
Dispute Resolution

SungJu Co., Ltd.                                         $10,047


BRIDGE TECHNOLOGY: Section 341(a) Meeting Slated for July 29
------------------------------------------------------------
The United States Trustee will convene a meeting of Bridge
Technology Inc.'s creditors at 9:30 a.m., on July 28, 2004, in
Room 1-159 at Ronald Reagan Federal Building, 411 W Fourth St.,
Santa Ana, California 92701.  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.

Headquartered in Garden Grove, California, Bridge Technology Inc.
-- http://www.bridgeus.com/-- is in the business of developing,  
marketing, and selling computer peripherals and computer system
enhancement products. The Company filed for chapter 11 protection
on June 21, 2004 (Bankr. C.D. Calif. Case No. 04-13988).  Herbert
N. Niermann, Esq., represents the Debtor in its restructuring
efforts. When the Company filed for protection from its creditors,
it listed $19,498,905 in total assets and $13,067,848 in total
debts.


BURNS EQUIPMENT: Case Summary & 4 Largest Unsecured Creditors
-------------------------------------------------------------
Debtor: Burns Equipment Company, Inc.
        530 Woodlake Circle
        Chesapeake, Virginia 23320

Bankruptcy Case No.: 04-74024

Chapter 11 Petition Date: June 29, 2004

Court: Eastern District of Virginia (Norfolk)

Judge: David H. Adams

Debtor's Counsel: John D. McIntyre, Esq.
                  Willcox & Savage, P.C.
                  1800 Bank of America Center
                  Norfolk, VA 23510
                  Tel: 757-628-5500

Total Assets: $1,328,750

Total Debts:  $4,636,287

Debtor's 4 Largest Unsecured Creditors:

Entity                        Nature Of Claim       Claim Amount
------                        ---------------       ------------
Bank of Hampton Roads         Machinery and           $2,875,000
P.O. Box 1000                 Equipment
Chesapeake, VA 23327          Secured Value:
                              $443,358

CitiCapital Commercial Corp.                            $850,073
Mr. Ed Kupp, Mail Box H02-115
250 E. John Carpenter Freeway
Irving, TX 75062

City of Chesapeake            2003 Property Taxes        $25,822
                              (due 6/10/04)

Bank of Hampton Roads         Deficiency Claim           Unknown


CANDESCENT TECH: First Meeting of Creditors Fixed for July 14
-------------------------------------------------------------
The United States Trustee will convene a meeting of Candescent
Technologies Corp.'s creditors at 10:30 a.m., on July 14, 2004, at
the U.S. Federal Building, 280 S. 1st St., Number 130, San Jose,
California 95113.  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.

Headquartered in Los Gatos, California, Candescent Technologies
Corp. -- http://www.candescent.com/-- is a supplier of flat panel  
displays for notebook computers, communications and consumer
products.  The Company filed for chapter 11 protection on June 16,
2004 (Bankr. N.D. Calif. Case No. 04-53803).  Ramon Naguiat, Esq.,
at Pachulski, Stang, Ziehl, Young et al represents the Debtors in
their restructuring efforts.  When the Company filed for
protection from their creditors, they listed both estimated debt
and assets of over $100 million each.


CHALK MEDIA: Signs Deal With Quebecor Unit Groupe Archambault   
-------------------------------------------------------------
Groupe Archambault's Illico on Demand, a wholly owned subsidiary
of Quebecor Media, has purchased episodes of the Dave Chalk
Connected television show from Chalk Media Corp.

Illico on Demand will provide Quebec subscribers with instant
access to the half-hour episodes of the Dave Chalk Connected
television show. Illico's newly launched Video on Demand is a new
service platform that is being offered to more than 1,433,000
Videotron cable customers; 240,000 of these customers currently
subscribe to the Illico Digital television service. The Video on
Demand service allows twenty-four hour access to programs and is
exclusive to cable subscribers.

Dave Chalk has stated that, "Chalk Media is excited to be part of
Illico's Video on Demand service. Video on Demand has clearly
become an important aspect of television and will play a key role
for television in the future".

                     About Quebecor Inc.

Quebecor Inc. (TSX: QBR.A - News, QBR.B - News) is a
communications company with operations in North America, Europe,
Latin America and Asia. It has two operating subsidiaries,
Quebecor World Inc. and Quebecor Media Inc. Quebecor World is one
of the largest commercial print media services company in the
world. Quebecor Media is a leading Canadian-based media company
with interests in newspaper publishing, cable television,
television broadcasting, Web integration and technology, Internet
portals, magazine publishing, book publishing, distribution and
retailing of cultural products and business telecommunications.

                   About Chalk Media Corp.

Chalk Media (TSX-V: CKM) produces network television & in-flight
entertainment programming and online training & marketing
solutions. The company's television shows, ranging from Dave Chalk
Computer Show to Dave Chalk Connected, have won many awards and
accolades and have built a highly recognizable brand name.
Leveraging this brand has allowed the company to build
relationships with a blue-chip customer base and provide them with
custom online training and marketing solutions. Chalk Media's
custom solutions help industry-leading companies communicate more
effectively with their customers, distribution partners and
employees.

With offices in Toronto, Ontario and Vancouver, British Columbia,
Chalk Media works with global organizations such as Samsung,
Intrawest, TELUS Mobility, RBC Financial, HSBC, Future Shop,
Terasen, Verizon, Sony, Bell Canada, Thomson Carswell and
Microsoft.

At March 31, 2004, Chalk Media Corp.'s balance sheet shows a
deficit of C$416,886.


COLLINS & AIKMAN: Releases Preliminary Q2 2004 Operating Results
----------------------------------------------------------------
Collins & Aikman Corporation (NYSE: CKC) held a meeting last week
with certain institutional investors in the company's debt
securities.  The Company discussed preliminary financial results
for the second quarter ended June 30, 2004.  Conference call
materials are available on the company's website at
http://www.collinsaikman.com/investor/confcalls.htmlprior to the  
start of the meeting.

Based on preliminary information, all of which is subject to
review and change as the company prepares its full financial
statements for the second quarter of 2004, the company estimates
that sales will be in the range of $1.02 billion to $1.04 billion,
operating profit will be in a range of $21 million to $27 million.
Depreciation and amortization is expected to be approximately $36
million to $37 million. The company's net debt at June 30, 2004 is
expected to be in the range of $1.436 billion to $1.442 billion.
This information is preliminary and full financial statements are
not yet prepared. This information should be reviewed in the
context of the company's reported results once those are
available. These estimates will be discussed on the conference
call later this morning.

Collins & Aikman Corporation, a Fortune 500 company, is a global
leader in cockpit modules and automotive floor and acoustic
systems and a leading supplier of instrument panels, automotive
fabric, plastic-based trim and convertible top systems. The
company's current operations span the globe through 16 countries,
more than 100 facilities and nearly 24,000 employees who are
committed to achieving total excellence. Collins & Aikman's high-
quality products combine superior design, styling and
manufacturing capabilities with NVH "quiet" technologies that are
among the most effective in the industry. Information about
Collins & Aikman is available on the Internet at
http://www.collinsaikman.com/

                          *   *   *

As reported in the Troubled Company Reporter's May 5, 2004
edition, Standard & Poor's Ratings Services placed its ratings on
carpet manufacturer Collins & Aikman Floorcoverings Inc. on
CreditWatch with negative implications, including the company's
'BB-' long-term corporate credit and senior secured debt ratings.
The 'B' subordinated debt rating was also placed on CreditWatch.

Collins & Aikman Floorcoverings' total debt outstanding at Jan.
31, 2004, was $209.3 million.

"The CreditWatch placement follows the company's announcement that
it is currently in discussions with its secured lenders to obtain
a waiver and amendments to the covenants under its senior secured
revolving credit facility for fiscal 2005 ending Jan. 31," said
Standard & Poor's credit analyst Susan Ding. "Although the company
expects to obtain these revisions, they have caused a delay in the
company's 10-K filing with the SEC."


CORAL REEF RESTAURANT: Voluntary Chapter 11 Case Summary
--------------------------------------------------------
Debtor: Coral Reef Restaurant, Inc.
        819 8th Street
        Ocean City, New Jersey 08226

Bankruptcy Case No.: 04-32580

Type of Business: The Debtor operates a restaurant.

Chapter 11 Petition Date: July 7, 2004

Court: District of New Jersey (Camden)

Judge: Gloria M. Burns

Debtor's Counsel: Tomas Espinosa, Esq.
                  4500 Cottage Place, 2nd Floor
                  Union City, NJ 07087
                  Tel: 201-223-1803

Estimated Assets: $1 Million to $10 Million

Estimated Debts:  $500,000 to $1 Million

The Debtor did not file a list of its 20-largest creditors.


CORNING INC: Sells Frequency Control Business to Vectron Int'l
--------------------------------------------------------------
Corning Incorporated (NYSE:GLW) has agreed to sell its frequency
control business to Vectron International, Incorporated. Financial
details of the transaction are not being disclosed.

Corning Frequency Control, part of Corning's telecommunications
segment, was acquired in 2000 as part of Corning's purchase of Oak
Industries. CFC designs and manufactures precision crystal
oscillators, resonators, and filters that serve as stable
frequency references for a broad range of wireless and wireline
communications technologies. Vectron International is an industry
veteran in the design, manufacture and marketing of crystal and
Surface Acoustic Wave products.

Corning expects to close the transaction in the third quarter of
this year and realize a loss of approximately $25 million pre-tax
in its third quarter results including the allocation of a portion
of the telecommunications segment's goodwill.

               About Corning Incorporated

Corning Incorporated -- http://www.corning.com/-- is a  
diversified technology company that concentrates its efforts on
high-impact growth opportunities. Corning combines its expertise
in specialty glass, ceramic materials, polymers and the
manipulation of the properties of light, with strong process and
manufacturing capabilities to develop, engineer and commercialize
significant innovative products for the telecommunications, flat
panel display, environmental, semiconductor, and life sciences
industries.

                       *   *   *

As reported in the Troubled Company Reporter's March 11, 2004
edition, Standard & Poor's Rating Services assigned its 'BB+'
rating to Corning Inc.'s proposed $400 million senior unsecured
notes, consisting of a $200 million 10-year and a $200 million 12-
year offering under the company's existing shelf registration. At
the same time, Standard & Poor's affirmed its 'BB+' corporate
credit rating and its other ratings on Corning. Proceeds of the
issuance are expected to be used primarily to repay existing debt
and for other corporate purposes.

The ratings outlook is stable.

"While the debt offering is viewed as a mild positive by improving
the term structure of Corning's debt profile in addition to
already substantial debt reduction, we remain mainly focused on
cash flow and earnings improvement by Corning," said Standard &
Poor's credit analyst Robert Schulz.

Fitch Ratings also assigned a 'BB' rating to Corning Inc.'s
proposed debt offering of $400 million of senior unsecured notes,
consisting of two tranches of $200 million due 2014 and 2016. The
'B' convertible preferred stock is affirmed.

According to Fitch, Corning's ratings reflect the strained but
improved credit protection measures, negative free cash flow, and
stabilizing but still challenging telecommunications end-markets
which still comprised 46% of revenue as of December 31, 2003. Also
recognized are the company's improved balance sheet and liquidity
and leading positions in diverse markets.


CRITICAL PATH: OTC Lists Rights to Purchase E Preferred Stock
-------------------------------------------------------------
Critical Path, Inc. (Nasdaq:CPTH) announced that its transferable
subscription rights to purchase up to $21 million of Series E
Preferred Stock of Critical Path in the previously announced
rights offering will be quoted on the OTC Bulletin Board under the
symbol CPTHR beginning on July 9, 2004.  Critical Path has also
been advised by Schwab Capital Markets L.P. that it intends to
make a market in the transferable subscription rights until the
expiration of the rights offering.

The dealer-manager of the rights offering is Perseus Advisors,
LLC. Additional copies of the prospectus and subscription
documents may be obtained by writing to the information agent,
Georgeson Shareholder Communications, Inc., 17 State Street, 10th
Floor, New York, NY 10004, or by calling toll-free (800) 843-1451.
Georgeson Shareholder Communications, Inc. will also answer
questions and provide assistance concerning the subscription
process.

A post-effective amendment to the registration statement relating
to these securities has been filed with the Securities and
Exchange Commission and has been declared effective. The rights
offering will only be made by means of a prospectus. This press
release shall not constitute an offer to sell or a solicitation of
an offer to buy any securities in the rights offering, nor shall
there be any sale of any securities in any state in which such
offer, solicitation or sale would be unlawful prior to
registration or qualification under the securities laws of such
state or jurisdiction.

                 About Critical Path, Inc.

Critical Path, Inc. (Nasdaq:CPTH) is a global provider of digital
communications software and services, headquartered in San
Francisco. More information is available at
http://www.criticalpath.net/

At March 31, 2004, Critical Path's balance sheet shows a
stockholders' deficit of $90.6 million compared to a deficit of
$77.2 million at December 31, 2003.


DII INDUSTRIES: Hires Jenkens & Gilchrist for Litigation Work
-------------------------------------------------------------
DII Industries, LLC, asks the U.S. Bankruptcy Court for permission
to employ Jenkens & Gilchrist as their special counsel in
connection with their Chapter 11 cases, nunc pro tunc to the
Petition Date.

The Debtors state that J&G is familiar with their operations, has
previously provided legal services to them, and will provide
services that are necessary to the discharge of their duties as
debtors-in-possession.  The Debtors tell the Court that the J&G
attorneys have the experience and expertise required to perform
the tasks necessary to their Chapter 11 cases.

According to the Debtors, J&G will advise and represent KBR,
Inc., as a defendant in connection with a certain litigation with
Hirschfield Steel Company, Inc., and the Harris County/Houston
Sports Authority concerning the construction of Minute Maid Park,
formerly known as Enron Field.  In addition, J&G will advise and
represent KBR on some environmental matters and on some
immigration matters for KBR employees.

J&G was retained by the Debtors to continue performing these
services as an ordinary course professional pursuant to a Court
Order dated December 18, 2003.  However, because J&G's fees for
these services have exceeded the maximum amount allowed for
qualification as an ordinary course professional, it is now
necessary for J&G to be retained as special counsel to the
Debtors pursuant to Section 327(e) of the Bankruptcy Code.

The Debtors will compensate J&G according to its standard hourly
rates:

        Partners                          $295 - 765
        Of Counsel                         290 - 555
        Associates                         180 - 495
        Legal Para-professionals            75 - 185

J&G's rates are adjusted from time to time to reflect changes in
seniority, inflation, and other economic factors and conditions.
The Debtors will also reimburse J&G for the out-of-pocket
expenses it incurred in connection with the Debtors' cases.

Nicholas A. Simms, Esq., assures the Court that J&G does not have
an interest materially adverse to the interest of the Debtors'
estates or of any class of creditors or equity security holders,
by reason of any direct or indirect relationship to, connection
with, or interest in, the Debtors or an investment banker.

Headquartered in Houston, Texas, Kellogg, Brown & Root is engaged
in the engineering and construction business, providing a wide
range of services to energy and industrial customers and
government entities in over 100 countries. DII has no business
operations.  The Company filed for chapter 11 protection on
December 16, 2003 (Bankr. W.D. Pa. Case No. 02-12152). Jeffrey N.
Rich, Esq., Michael G. Zanic, Esq., and Eric T. Moser, Esq., at
Kirkpatrick & Lockhart LLP, represent the Debtors in their
restructuring efforts.  (DII & KBR Bankruptcy News, Issue No. 15;
Bankruptcy Creditors' Service, Inc., 215/945-7000)


DOLLAR GENERAL: Reports $715.6 Million Retail Sales in June
-----------------------------------------------------------
Dollar General Corporation (NYSE: DG) reported total retail sales
for the June five-week period ended July 2, 2004, equaled $715.6
million compared with $649.7 million last year, an increase of
10.1 percent. Same-store sales for the June period increased 2.3
percent. The average customer purchase in June was approximately
$8.43 compared to $8.39 in the same period last year. Customer
transactions in same-stores increased approximately 2.1 percent.

For the nine weeks ended July 2, 2004, Dollar General total retail
sales increased 11.0 percent to $1.3 billion from $1.2 billion for
the nine weeks ended July 4, 2003. Same-store sales for the nine-
week period increased 3.0 percent.

For the 22 weeks ended July 2, 2004, Dollar General total retail
sales increased 11.2 percent to $3.0 billion from $2.7 billion for
the 22 weeks ended July 4, 2003. Same-store sales for the 22 weeks
increased 3.1 percent.

                     New Store Openings

The Company opened 65 Dollar General stores in 24 states during
the five-week period ended July 2, 2004. The 65 newest Dollar
General store locations include nine in Wisconsin; eight in Texas,
five in North Carolina, four in Arizona, three each in Florida,
Iowa, Illinois, Louisiana, New Mexico, New York and Ohio; two each
in Georgia, Michigan, Tennessee, Virginia and West Virginia; and
one each in Alabama, Indiana, Kentucky, Maryland, Mississippi,
Oklahoma, Pennsylvania and South Carolina. The Company closed 11
Dollar General stores during the period. The Company also opened
two Dollar General Markets, one each in Tennessee and Kentucky,
during the five-week period ended July 2, 2004. Year-to-date, the
Company has opened 357 Dollar General stores and two Dollar
General Markets and has closed 39 Dollar General stores.

               About Dollar General

Dollar General is a Fortune 500(R) discount retailer. Dollar
General stores offer convenience and value to customers by
offering consumable basic items that are frequently used and
replenished, such as food, snacks, health and beauty aids and
cleaning supplies, as well as a selection of basic apparel,
housewares and seasonal items at everyday low prices. The Company
store support center is located in Goodlettsville, Tennessee.
Dollar General's Web site is at http://www.dollargeneral.com/

                         *     *     *

As reported in the Troubled Company Reporter's April 19, 2004
edition, Standard & Poor's Ratings Services revised its outlook on
Dollar General Corp. to positive from negative. The revision is
based on a preliminary resolution of the SEC investigation into
accounting changes. The ratings on the company, including the
'BB+' corporate credit rating, were affirmed.

"The ratings on Goodlettsville, Tenn.-based Dollar General reflect
a highly competitive discount retail environment and risks
associated with an aggressive expansion program, somewhat
mitigated by a good market position and satisfactory cash flow
protection," said Standard & Poor's credit analyst Mary Lou Burde.


ENDURANCE SPECIALTY: Prices $250 Million 7% Sr. Debt Offering
-------------------------------------------------------------
Endurance Specialty Holdings Ltd. (NYSE:ENH), a Bermuda-based
provider of property and casualty insurance and reinsurance,
announced the pricing of $250 million principal amount of 7%
Senior Notes. The Senior Notes will initially be offered by the
underwriters at a price of 99.108% of their principal amount,
providing an effective yield of 7.072%, and, unless previously
redeemed, will mature on July 15, 2034.

Endurance expects to use a portion of the net proceeds from the
offering to repay the $103 million term loan outstanding under its
bank credit facility and to use the remaining proceeds for general
corporate purposes, including potential acquisitions and
repurchases of its shares and share equivalents.

The joint-book running managers are J.P. Morgan Securities Inc.
and Barclays Capital Inc. A shelf registration statement relating
to this offering was originally filed with the U.S. Securities and
Exchange Commission on June 15, 2004 and has since been declared
effective. This offering will be made pursuant to a prospectus
supplement to the shelf registration statement on file with the
SEC.

Copies of the prospectus supplement, when available, may be
obtained from J.P. Morgan Securities Inc., 270 Park Avenue, New
York, New York 10017, Tel: (212) 834-4533 and from Barclays
Capital Inc., 200 Park Avenue, New York, New York 10166, Tel:
(212) 412-2663.

            About Endurance Specialty Holdings  

Endurance Specialty Holdings Ltd. is a global provider of property  
and casualty insurance and reinsurance. Through its operating  
subsidiaries, Endurance currently writes property per risk treaty  
reinsurance, property catastrophe reinsurance, casualty treaty  
reinsurance, property individual risks, casualty individual risks,  
and other specialty lines. Endurance's operating subsidiaries have  
been assigned a group rating of A from A.M. Best and A- from  
Standard & Poor's. Endurance's headquarters are located at  
Wellesley House, 90 Pitts Bay Road, Pembroke HM 08, Bermuda and  
its mailing address is Endurance Specialty Holdings Ltd., Suite  
No. 784, No. 48 Par-la-Ville Road, Hamilton HM 11, Bermuda. For  
more information about Endurance, please visit  
http://www.endurance.bm/

                        *   *   *

As reported in the Troubled Company Reporter's June 18, 2004  
edition, Standard & Poor's Ratings Services assigned its 'BBB'  
counterparty credit rating to Endurance Specialty Holdings Ltd.  
and its preliminary 'BBB' senior debt, 'BBB-' subordinated debt,  
and 'BB+' preferred stock ratings to the company's $1.8 billion  
universal shelf registration.

"The ratings on Endurance are based on its strong competitive  
position, which is supported by a diversified business platform,"  
noted Standard & Poor's credit analyst Damien Magarelli. "In  
addition, Endurance maintains strong capital adequacy and strong  
operating performance." Offsetting these positive factors are  
concerns about Endurance's exposure to catastrophes and minimal  
reinsurance protections. Endurance also is a relatively new  
operation, and management has not been tested through  
difficult market cycles.


ENRON CORP: Judge Gonzales Won't Nix Plan Negotiation Language
--------------------------------------------------------------
In Enron Corporation's chapter 11 cases, Appaloosa Management, LP,
and Angelo Gordon & Co., LLP asked the Bankruptcy Court to issue
an order in limine to preclude the Debtors and the Creditors
Committee from introducing evidence at the hearing with respect to
the Plan Confirmation and the Motion to Approve the Global
Compromise of Inter-Estate Issues concerning their purported
negotiations of the global compromise embodied in the Plan.

At the hearing scheduled on June 3, 2004 with respect to the
confirmation of the Plan and the Global Compromise Motion, the
Debtors need to prove that the Plan was proposed in good faith
and that the purported settlement and compromise that is the
subject of the Global Compromise Motion was the product of good
faith, arm's-length negotiations between the parties.  

Recognizing these requirements, the Debtors' Global Compromise
Motion and the Disclosure Statement are replete with
representations that the Debtors and the Creditors Committee have
engaged in "extensive," "vigorous," "good faith," and "arm's-
length" negotiations.  Yet, Richard F. Casher, Esq., at Kasowitz,
Benson, Torres & Friedman, LLP, in New York, contends that
despite those representations and the significance of the issue,
the Debtors and the Creditors Committee have refused to disclose
the substance of the negotiations between them.  

The Committee and the Debtors assert that they are entitled to
withhold the information on the grounds of a common interest
privilege.  "That position has no merit," Mr. Casher remarks.  
"There is no common interest privilege for negotiations between
adversaries with respect to the terms of a potential settlement
or plan of reorganization and, even if there were, the Debtors
and the Committee have waived any privilege by placing their
purported negotiations over the terms of the Plan squarely at
issue in this case."

Mr. Casher contends that if the Debtors and the Committee were in
fact sufficiently united in interest throughout the time that
they were designing and composing the Plan to justify the
assertion of common interest privilege, then, by definition, they
could not have been engaged in arm's-length negotiations with
each other and the Debtors cannot satisfy the requisite burdens
they must meet to obtain approval of the Plan or the Global
Compromise Motion.

        Yosemite/CLN Noteholders Ad Hoc Committee Joins In

The Ad Hoc Committee joins Appaloosa Management, LP, and Angelo,
Gordon & Co., LP, in their request to preclude the Debtors and
the Creditors Committee from introducing evidence at the
Confirmation Hearing regarding their negotiations of the Global
Compromise.

                         *      *      *

For reasons stated in open court, Judge Gonzalez denies
Appaloosa's request in its entirety.  The Court reserves until a
later date, to the extent necessary, any ruling on the question
of the standing of Appaloosa and the Ad Hoc Committee to object
to the confirmation of the Debtors' Fifth Amended Plan, as
modified.  The Court will address the question of whether
sanctions should be imposed against Appaloosa and the Ad Hoc
Committee pursuant to the Debtors' and the Committee's requests
for costs and attorneys' fees at a separate hearing on
appropriate notice to be provided by the Debtors.(Enron Bankruptcy
News, Issue No. 115; Bankruptcy Creditors' Service, Inc., 215/945-
7000)


EQUIFIN INC: AMEX to Move for Delisting of Company's Common Stock
-----------------------------------------------------------------
At the close of business on July 7, 2004, the American Stock
Exchange notified EquiFin, Inc. (AMEX:II) that it intends to make
application to the Securities and Exchange Commission to strike
EquiFin's common stock from listing and trading on the AMEX. The
delisting application will be made as a result of the Company's
inability to comply, at June 30, 2004, with the AMEX's continued
listing standards set forth in Sections 1003 (a) (ii) - (iv) of
the AMEX Company Guide due to

     (i)   its stockholder's equity being less than $4 million and
           having sustained losses from continuing operations
           and/or net losses in three of its most recent fiscal
           years,

     (ii)  its stockholder's equity being less than $6 million
           while having sustained losses in its five most recent
           fiscal years, and

     (iii) the existence of circumstances that make it
           questionable to the AMEX as to whether the Company will
           be able to continue its current operations and meet
           ongoing obligations.

The Company has the right to appeal AMEX's decision to delist its
common stock from trading on the Exchange, but at this time it has
no reason, or intention, to do so. If the Company makes no
application to appeal this AMEX decision, the trading of EquiFin's
common stock on AMEX will cease on July 14, 2004.

The Company intends to make application to NASDAQ for the trading
of its common stock in the over-the-counter bulletin board market.

EquiFin, Inc., (AMEX:II AND II,WS) an early stage, commercial
finance company provides a range of capital solutions to small and
mid-size business enterprises.

                         *   *   *

In its Form 10-KSB for fiscal year ended December 31, 2003 filed  
with the Securities and Exchange Commission, Equifin, Inc.  
reports:

               Liquidity and Capital Resources

"Cash used in operating activities amounted to $916,000 for the  
year ended December 31, 2003.  Investing activities required cash  
of $6,904,000, which included $7,474,000 for development of the  
loan portfolio which was offset to an extent by $250,000 received  
from the sale of a participation.  Financing activities provided  
$8,510,000 in cash, which included $6,066,000 in borrowings and  
$2,880,000 from the sale of convertible notes.  The result of  
these activities was a net increase in cash of $690,000 which  
increased cash to $1,078,000 at year-end December 31, 2003.

"In December 2001, Equinox Business Credit Corp., an 81% owned  
subsidiary of the Company, entered into a Loan and Security  
Agreement with Wells Fargo Foothill, which provided for the  
initiation of a $20,000,000 revolving credit facility.  The  
agreement provides for interest at the prime rate plus 1.25%  
(equal to 5.25% at December 31, 2003).  Equinox is permitted to  
borrow under the Credit Facility at up to 85% of the borrowing  
base, which consists of eligible notes receivable, as defined in  
the Agreement.  Under the terms of the Agreement, as amended,  
Equinox must maintain tangible net worth (including subordinated  
debt) of $3,000,000 from December 31, 2003 through February 29,  
2004; $3,050,000 through May 31, 2004; $3,100,000 through August  
31, 2004 and $3,150,000 thereafter; a leverage ratio, as defined,  
of not more than 5 to 1 and an interest coverage ratio of not less  
than 1.1 to 1, increasing to 1.25 to 1 beginning April 2004.   
Equinox did not maintain the tangible net worth requirement for  
December 31, 2002, January 31, 2003, February 28, 2003 and June  
30, 2003 and the interest coverage ratio at September 30, 2003.   
Through amendments to the Agreement, the lender waived the  
defaults for those periods.   

"During 2004, Equinox is also required to realize, for each fiscal  
quarter in 2004, 75% of its projected revenues and projected  
earnings before tax based on projections previously furnished to  
Foothill.  All the assets and the capital stock of Equinox are  
pledged to secure the Credit Facility, which is also guaranteed by  
the Company.  There was $9,839,000 outstanding on the Credit  
Facility at December 31, 2003.  The Agreement matures December 19,  
2004 and the has lender informed the Company that it does not  
currently intend to renew the agreement.   

"The Company will seek to replace the credit facility prior to  
maturity, however there can be no assurance that such efforts will  
be successful.  If our current facility is not replaced, we might  
negotiate a sale of our portfolio, apply all cash flow generated  
by the loans securing the facility to pay down our borrowings  
thereby adversely effecting our liquidity position.  In this  
situation, we may not be able to satisfy our outstanding loan  
commitments, originate new loans or continue to fund our  
operations."

Also, the report of Equifin Inc.'s independent public accountants  
includes this paragraph:  
  
"The Company incurred net losses and negative cash flows from its  
operating activities during 2003 and 2002. As of March 12, 2004,  
the Company did not have any other source of funds to replace the  
funds provided by the credit facility when it expires in December  
2004. Such matters raise substantial doubt about the Company's  
ability to continue as a going concern."


FLEMING COMPANIES: Court Denies CHEP's Prelim Injunction Request
----------------------------------------------------------------
In Fleming Companies, Inc.'s chapter 11 cases, Kurt F. Gwynne,
Esq., at Reed Smith, LLP, in Wilmington, Delaware, tells the Court
that CHEP USA leases wooden pallets to third parties, but at all
times retains ownership of the pallets. To evidence that
ownership, CHEP paints its pallets a distinctive blue color and
imprints the pallets with CHEP's logo and the words "Property of
CHEP."  These pallets are never sold with the goods they
transport.  At the end of the supply chain, the receiving
distributor off-loads the goods from the pallets and is
responsible for returning the CHEP pallets to the nearest CHEP
service center.

                 The Distribution Letter Agreement

In September 1991, CHEP and Fleming signed a distribution letter
agreement authorizing Fleming to receive the CHEP pallets from
various manufacturers and others as a participating distributor
in the CHEP pooling system.  In the letter agreement, Fleming
acknowledged CHEP's ownership interest in the pallets.  Fleming
agreed to use CHEP pallets to transfer loads to retail stores,
and to bring the pallets back to Fleming's warehouse when the
store has removed the goods from them.  Fleming agreed to
segregate the CHEP pallets from other pallets and return them to
CHEP at Fleming's expense for redistribution into the CHEP
pooling system.

Under the letter agreement, Fleming agreed to pay CHEP an
assessment of $15 per pallet for any lost or unaccounted for
pallets.  Lost pallets, which were later found, could be
delivered to CHEP and an appropriate adjustment would be made.  

In a 1992 letter, CHEP agreed to reduce the damage assessment for
lost pallets to $5 to the extent that the aggregate number of
pallets deemed lost in any 12-month period did not exceed 1% of
the number of pallets transferred to Fleming in that 12-month
period.

In August 2003, CHEP conducted an audit of the pallets at all of
Fleming's distribution centers and found out that the Debtors
lost 957,383 pallets.  Of that number, the Debtors lost 316,401
pallets since the Petition Date.

                 Accounting and the Kmart Claim

CHEP's ownership interest was expressly recognized and preserved
under the Court Order approving the sale of the Debtors'
Wholesale Business to C&S Acquisition.  The Sale Order directed
the Debtors to account for all of CHEP's pallets.  However,
Fleming failed to account to CHEP for the whereabouts of the
957,384 pallets lost.

In December 2003, while reviewing Fleming's records in response
to a discovery request, CHEP discovered that Fleming had filed an
application for allowance and payment of an administrative
expense claim in the bankruptcy case of In re Kmart Corporation
in the U.S. Bankruptcy Court for the Northern District of
Illinois.  Fleming claimed that Kmart owed it $30,344,222, and
attached a "Postpetition Balances A/R and A/P" which included a
claim for CHEP pallets shipped by Fleming to Kmart after Kmart's
bankruptcy filing, valued at $5,827,517, which amount equals
363,499 pallets at $15 per pallet.

CHEP concludes that Fleming is charging Kmart a lost pallet fee
for the CHEP pallets that Fleming delivered to Kmart.  Fleming
had no right to charge the lost pallet fee because the pallets
are owned by CHEP -- not Fleming.

In March 2003, Kmart asked the Illinois Bankruptcy Court to
approve a settlement with Fleming, in which Fleming agreed to
reduce its claim from $30.3 million to $15 million.  Kmart agreed
to pay Fleming $15 million on account of the allowed
administrative claim no later than three business days after the
settlement was approved.  Later that month, Judge Susan Pierson
Sonderby approved the settlement.  Based on the settlement, Kmart
paid Fleming $5,827,517 for the CHEP pallets Kmart lost.

Mr. Gwynne contends that Fleming intentionally and improperly
kept the funds for the CHEP pallets for which it had no right to
receive and retain payment.  By charging and retaining the fees
paid by Kmart, Fleming improperly exercised dominion and control
over the payment made for lost CHEP pallets in violation of
CHEP's ownership rights and the distributor agreement.

For these reasons, CHEP asks Judge Walrath to enjoin Fleming from
reducing its cash below the amount of the settlement with Kmart.  
CHEP also seeks damages equal to the total value of its lost
pallets.

                         Fleming Answers

Fleming denies all material allegations asserted by CHEP.  
However, Fleming admits that some, but not all, of the pallets
that it delivered to Kmart were pallets owned by CHEP.

Fleming asks the Court to dismiss CHEP's claims for unjust
enrichment and imposition of a constructive trust based on three
grounds:

       (1) The constructive trust fails because there is no
           identifiable res to which the trust may attach;

       (2) Fleming did not act as a conduit on CHEP's behalf
           when it received funds from Kmart in settlement of
           its administrative claim; and

       (3) CHEP does not allege facts establishing its right to
           a constructive trust.

Scotta E. McFarland, Esq., at Pachulski Stang Ziehl Young Jones &
Weintraub, PC, in Wilmington, Delaware, contends that, since a
constructive trust cannot be imposed, the unjust enrichment claim
presents, at best, a duplicative unsecured claim.  CHEP also does
not state a claim for conversion, and its request for injunction
is mooted by its inability to state a claim for imposition of a
constructive trust.

Ms. McFarland says that, although CHEP claims that Fleming
received $5,827,517 from Kmart for the CHEP pallets, Fleming
received a $15 million lump-sum payment from Kmart in settlement
of several claims.  No particular portion of that payment was
allocated to CHEP's pallets, and no particular portion of that
payment is thus an identifiable trust res.

CHEP cannot establish that Fleming was merely a conduit for the
Kmart payment.  An entity acts as a conduit when it collects
money from one source and forwards it to its intended recipient.  
There is nothing showing any obligation on Fleming's part to turn
over any portion of the Kmart payment to CHEP, nor any showing
that Fleming acted as CHEP's collection agent.  Fleming's
liability to CHEP is based entirely on its contract with CHEP,
and is independent of any liability of Kmart to Fleming.  
Fleming, and Fleming alone, bears the risk of any pallets it
loses or cannot account for.

CHEP also does not show any federal interest in the contractual
arrangement of the parties.  In these circumstances, state law
controls whether a constructive trust may be imposed.  Fleming's
actions in settling its claims with Kmart do not give rise to a
constructive trust under the more rigorous state law standards.

                         *      *      *

At the hearing, the Debtors argued that, because their cash on
hand balance will not fall below $20 million, no injunction is
needed as CHEP could not be harmed on its $5 million claim.  The
Debtors would continue to maintain sufficient cash on hand to
preserve CHEP's ability to trace its trust res pursuant to the
lowest intermediate balance test.

Consequently, CHEP deposed the corporate representative for Kmart
relating to the issues raised in the Adversary Proceeding.  
Kmart's representative testified that it expected a release on
all of the items set forth in the administrative claim and that
Kmart did not exclude the CHEP pallet claim from the settlement
payment.

The Court held that Kmart may have decided not to pay any of the
pallet claim because Kmart may have felt it was worthless.  
Accordingly, the Court denies CHEP's request for preliminary
injunction.

Headquartered in Lewisville, Texas, Fleming Companies, Inc. --
http://www.fleming.com/-- is the largest multi-tier distributor  
of consumer package goods in the United States.  The Company filed
for chapter 11 protection on April 1, 2003 (Bankr. Del. Case No.
03-10945).  Richard L. Wynne, Esq., Bennett L. Spiegel, Esq.,
Shirley Cho, Esq., and Marjon Ghasemi, Esq., at Kirkland & Ellis,
represent the Debtors in their restructuring efforts.  When the
Debtors filed for protection from its creditors, they listed
$4,220,500,000 in assets and $3,547,900,000 in liabilities.
(Fleming Bankruptcy News, Issue No. 38; Bankruptcy Creditors'
Service, Inc., 215/945-7000)


FOUNDATION COAL: S&P Assigns BB- Corporate Credit Rating
--------------------------------------------------------
Standard & Poor's Rating Services assigned its 'BB-' corporate
credit rating to Linthicum Heights, Maryland-based Foundation Coal
Corp. The outlook is stable.

In addition, Standard & Poor's assigned its 'BB-' bank loan rating
and recovery rating of '4' to Foundation PA Coal Co.'s proposed
$785 million secured credit facility, consisting of a $350 million
revolving credit facility maturing in 2009 and a $435 million term
loan B facility maturing in 2011. The 'BB-' rating is the same as
the corporate credit rating; this and the '4' recovery rating
indicate a marginal expectation of full recovery of principal in
the event of a default. Standard & Poor's also assigned its 'B'
rating to Foundation PA Coal's proposed $335 million senior
unsecured notes, maturing in 2014.

"The ratings on Foundation Coal reflect its aggressive financial
leverage, limited operating diversity, inherent operating risks,
and exposure to expiring western coal supply contracts that are
currently above spot prices," said Standard & Poor's credit
analyst Dominick D'Ascoli. Partially offsetting these risks are
its competitive cost position and favorable coal industry
conditions.

Foundation Coal will use the proceeds from the term loan and the
senior unsecured notes in conjunction with $196 million of private
equity to finance the $966 million acquisition of RAG American
Coal Holding Inc. from RAG Coal International AG. Foundation Coal
is owned by a private equity consortium consisting of First
Reserve Corp., Blackstone Group L.P., and American Metals & Coal
International, whose equity interests are 42.5%, 42.5%, and 15%,
respectively. The transaction is expected to close in the third
quarter of 2004. Foundation Coal has no assets apart from what it
will be acquiring in this acquisition. The assets that Foundation
Coal is acquiring from RAG American produced approximately 65
million tons of coal, or about 6% of total U.S. production in
2003, from four regions, including the Powder River Basin,
the Illinois Basis, Central and Northern Appalachia.

Standard & Poor's has a favorable near-term outlook for the coal
industry because the factors responsible for the surge in spot
coal prices remain in place and likely will persist in the short
term. Depleting reserve bases in the Central Appalachia region,
along with difficulties in permitting brownfield and greenfield
expansions; lack of surety bond issuances; environmental lawsuits;
and increased regulation have contributed to higher costs and
declining production.


GE CAPITAL: Fitch Affirms Low-B Ratings of 6 GECMC 2001-3 Classes
-----------------------------------------------------------------
Fitch affirms GE Capital Commercial Mortgage Pass-Through
Certificates, series 2001-3, as follows:

               --$243.8 million class A-1 'AAA';
               --$478.9 million class A-2 'AAA';
               --Interest-only classes X-1 and X-2 'AAA';
               --$42.2 million class B 'AA';
               --$38.6 million class C 'A';
               --$13.3 million class D 'A-';
               --$7.2 million class E 'BBB+';
               --$14.5 million class F 'BBB';
               --$12.0 million class G 'BBB-';
               --$27.7 million class H 'BB+';
               --$8.4 million class I 'BB';
               --$7.2 million class J 'BB-';
               --$12.0 million class K 'B+';
               --$4.8 million class L 'B';
               --$4.8 million class M 'B-'.

Fitch does not rate $21.7 million class N.

The rating affirmations reflect the consistent overall loan
performance and minimal reduction of the pool balance since
closing. As of the June 2004 distribution date, the pool has paid
down 2.8% to $937.1 million from $963.8 million at issuance.

As of year-end 2003, the weighted average debt service coverage
ratio for the pool is relatively stable at 1.64 times (x), from
1.67x as of YE 2002 for the same loans. However, the YE 2003
performance has increased since the 1.52x DSCR reported at
issuance. The weighted average DSCR was calculated using financial
statements collected as of June 2004 by the master servicer, GEMSA
Loan Services, LP, for 99.00% of the loans remaining in the pool.

Of concern in the transaction are two loans (0.85% of the pool) in
special servicing. The first loan (0.68%) is secured by a
multifamily apartment complex located in Centerville, OH. The
special servicer conducted a foreclosure sale, in which the lender
was the winning bidder. The second loan (0.17%), which is secured
by a multifamily complex located in Middletown, OH, became REO in
June 2004. While Fitch expects losses associated with these loans,
the nonrated class N is sufficient to absorb losses at this time.


GLOBAL WATER: U.S. Bankruptcy Court Confirms Reorganization Plan
----------------------------------------------------------------
The U.S. Bankruptcy Court for the District of Colorado confirmed a
chapter 11 plan of reorganization for Global Water Technologies,
Inc., (OTC: GWTRQ).  

George Kast, Chairman and CEO stated, "We are delighted that these
proceedings have concluded favorably. We will now move forward
with the recovery efforts and the significant opportunities we
have developed in one of the world's largest markets -- the water
industry. Our past successes and proprietary technologies position
GWT to become one of the world's leading water purification and
services companies. The partnerships we have solidified during the
past 12 months will enhance our product offerings, increase our
distribution channels and accelerate our growth.

"The world's thirst for purified water continues to grow while the
world's supply of fresh water is diminishing."

               About Global Water Technologies

Global Water Technologies, Inc. (OTC: GWTRQ) is a water
purification and services company with "clearly" innovative
technologies, focused on the energy, oil and gas, process, HVAC
and municipal markets. The company utilizes its proprietary
technologies and services program to increase operating
efficiencies, reduce water use and costs through its'
comprehensive water management solutions. GWT's products treat
over 10 billion gallons of water per day. GWT, through its former
subsidiaries, has an established client base of over 500 customers
in more than 25 countries worldwide and cumulative revenues in
excess of $350 million. Some of these customers include: YORK
International, Exelon, U.S. Air Force, DaimlerChrysler, General
Electric.

The Company filed for chapter 11 protection on May 14, 2003
(Bankr. Colo. Case No. 03-19278).  Robert Padjen, Esq., at Rubner
Padjen and Laufer LLC represents the Debtor in its restructuring
efforts. When the Company filed for protection from its creditors,
it listed $60,023,000 in total assets and $55,544,553 in total
debts.


GMAC COMMERCIAL: Fitch Affirms Low-B Ratings of 7 2002-C3 Classes
-----------------------------------------------------------------
Fitch affirms GMAC Commercial Mortgage Pass-Through Certificates,
series 2002-C3, as follows:

               --$194.2 million class A-1 'AAA';
               --$406.4 million class A-2 'AAA';
               --Interest-only classes X-1 and X-2 'AAA';
               --$29.2 million class B 'AA';
               --$11.7 million class C 'AA-'
               --$18.5 million class D 'A';
               --$11.7 million class E 'A-';
               --$9.7 million class F 'BBB+';
               --$9.7 million class G 'BBB';
               --$9.7 million class H 'BBB-';
               --$18.5 million class J 'BB+';
               --$8.7 million class K 'BB';
               --$5.8 million class L 'BB-';
               --$4.9 million class M 'B+';
               --$3.9 million class N 'B';
               --$2.7 million class O-1 'B-';
               --$1.2 million class O-2 'B-'.
     
Fitch does not rate $17.5 million class P.

The rating affirmations reflect the consistent loan performance
and minimal reduction of the pool collateral balance since
closing. As of the June 2004 distribution date, the pool has paid
down 1.71% to $763.9 million, from $777.4 million at issuance.

As of year-end 2003, the weighted average debt service coverage
ratio (DSCR) for the pool has increased to 1.61 times (x), from
1.59x as of YE 2002 for the same loans. The weighted average DSCR
was calculated using financial statements collected as of June
2004 by the master servicer, GMAC Commercial Mortgage, for 61.25%
of the loans in the pool.

There is currently one loan (1.23%) in special servicing. The loan
is secured by an industrial building located in Muhlenberg
Township, PA. The special servicer is pursuing foreclosure on the
property and losses, if any, associated with the disposition of
this loan that are unknown at this time.


HAWAIIAN HOLDINGS: AFA Opposes Hawaiian Airlines Bonus Plan
-----------------------------------------------------------
The Association of Flight Attendants--CWA, AFL-CIO, wants a
federal bankruptcy court to reject a scheme offered by the trustee
of Hawaiian Airlines to give huge bonuses to its executives and
managers, even though the carrier has extracted concessions from
its employees.

"Flight attendants made substantial sacrifices in order to ensure
the recovery of our airline," said Sharon Soper, president of the
AFA Master Executive Council at Hawaiian. "Now the trustee wants
the bankruptcy court to approve a plan that would reward managers
who did not share in these sacrifices."

In March 2003, Hawaiian flight attendants agreed to a package of
contract concessions worth $3.475 million per year in order to
keep the carrier aloft - - just slightly more than the amount now
earmarked for management bonuses. Earlier this year, the company
demanded more concessions although it had returned to
profitability.

The AFA filing notes that the plan offered by Trustee Joshua
Gotbaum, offered as a way to retain executives, in no way compels
managers to remain at Hawaiian.

More than 46,000 flight attendants join together to form AFA, the
world's largest flight attendant union. AFA is part of the 700,000
member strong Communications Workers of America, AFL-CIO. Visit us
at http://www.afanet.org/

                    About Hawaiian Holdings

Hawaiian Holdings is a Delaware corporation that has been public
since August 2002, when Hawaiian Airlines, which had been publicly
held, became its wholly owned subsidiary in an internal corporate
reorganization. Hawaiian Airlines filed for chapter 11 bankruptcy
protection on March 21, 2003.


HERCULES INC: Names Charles Wardlaw VP & Chief Procurement Officer
------------------------------------------------------------------
Charles Wardlaw joined Hercules Incorporated (NYSE:HPC) as Vice
President and Chief Procurement Officer, reporting to Craig A.
Rogerson, President and CEO.

"Global Procurement plays a crucial role in achieving our business
objectives, especially since economic conditions are producing
increased pricing pressure on raw materials.

"Chuck brings the knowledge and experience to Hercules that will
further strengthen our Procurement organization and take that
function to even higher levels of performance. His broad
perspective will make him a valuable addition to our Senior
Management Team," said Mr. Rogerson.

Prior to joining Hercules, Mr. Wardlaw served as Vice President,
Strategic Sourcing for Tyco International's Fire & Security
Segment. He was instrumental in transitioning the strategic
sourcing/global purchasing organization from a highly
decentralized to a centralized, competency-based model.

Prior to joining Tyco International in 2001, he was Global
Sourcing Director for DuPont Dow Elastomers, LLC. His professional
career with the DuPont Company spanned more than two decades,
during which he held various positions of increasing
responsibility including Technology Superintendent, Corian
Building Products; and management positions in business planning,
sales, marketing and manufacturing.

Mr. Wardlaw earned a B.S. in Chemical Engineering from the
University of Pennsylvania as well as a Fellowship to the
University of London, Imperial College, where he received an M.Sc.
He holds an MBA in Finance and International Business from Temple
University.

Hercules manufactures and markets chemical specialties globally  
for making a variety of products for home, office and industrial  
markets. For more information, visit the Hercules website at  
http://www.herc.com/

                           *   *   *

As reported in the Troubled Company Reporter's March 24, 2004
edition, Standard & Poor's Ratings Services revised the outlook on
Hercules Inc. to stable from positive.

The outstanding ratings including the 'BB' corporate credit rating
on this Wilmington, Del.-based company were affirmed. Standard &
Poor's also assigned its 'B+' rating to Hercules' proposed $250
million senior subordinated notes due 2034. At the same time,
Standard & Poor's assigned its 'BB' senior secured bank loan
rating and its recovery rating of '2' to the company's proposed
$150 million revolving credit facility due 2007 and $400 million
term loan due 2010, based on preliminary terms and conditions. The
'BB' rating is the same as the corporate credit rating; this and
the '2' recovery rating indicate that bank lenders can expect
substantial (80%-100%) recovery of principal in the event of a
default.

The outlook revision reflects a slower-than-expected strengthening
of the financial profile given higher potential asbestos-related
obligations and the replacement of preferred securities, which had
some equity-like characteristics, with debt.

The ratings reflect Hercules' sizable debt burden and some
exposure to asbestos litigation. These weaknesses are partially
offset by Hercules' position as one of the larger specialty
chemical companies in North America with annual revenues of
approximately $1.8 billion, respectable operating margins, and
prospects for improving cash flow generation.


HEXCEL CORP: S&P Revises Outlook To Positive From Stable
--------------------------------------------------------
Standard & Poor's Ratings Services revised its outlook on Hexcel
Corp. to positive from stable. At the same time, Standard & Poor's
affirmed its ratings, including the 'B' corporate credit rating,
on the advanced structure manufacturer. The firm has approximately
$465 million in rated debt outstanding.

"The outlook revision reflects an improving financial profile due
to lower debt levels and cost reductions, as well as brightening
prospects for a recovery in the commercial aerospace industry,"
said Standard & Poor's credit analyst Christopher DeNicolo. In
response to a difficult operating environment, Hexcel instituted a
restructuring program, which has led to a $66 million reduction in
cash fixed costs. As a result, operating margins have returned to
the low teens percent area from low single digits in 2001. The
issuance of $125 million in secured notes and $125 million of
preferred stock in March 2003, with the proceeds used to reduce
debt by a net $90 million, eliminated near-term liquidity concerns
and improved the company's capital structure, which remains highly
leveraged. Hexcel was able to reduce debt by a further $48 million
in 2003 using free cash flows and proceeds from asset sales. As a
consequence, debt to EBITDA declined to below 4.5x in 2003 from
over 6x in 2002. The return to profitability in the first quarter
of 2004 follows several years of losses.

In the commercial aircraft market, weak air traffic, losses at
airlines, and grounded aircraft have constrained demand for new
planes and, thus, for the company's products. Production rates for
commercial jetliners appear to have stabilized at low levels, but
significant increases are not expected until 2006. However, in
recent weeks Airbus has indicated that production rates for
certain aircraft could be increased in the near to intermediate
term. Hexcel is beginning to see a material amount of revenues
from Airbus's A380 program as the first aircraft are now being
built. Boeing has recently announced that a competitor of Hexcel,
Toray Industries of Japan, will be providing the carbon fiber
composites for the primary structures of its just-launched
7E7 jetliner. However, other composite parts, such as those for
secondary structures, the interior, and the engines, have yet to
be awarded and could be a source of growth in the long term if won
by Hexcel. The 7E7 is expected to have 50% of its structure made
from composites, the highest of any large commercial aircraft to
date. The downturn in commercial aerospace and continued weakness
in the electronic materials business have offset positive trends
in some of the firm's smaller markets, such as military aircraft,
wind energy, and soft body armor.

Revenues and earnings are likely to benefit from favorable trends
in military aircraft, ballistics, and wind energy, as well as a
nascent recovery in the commercial aircraft market. These
improvements combined with lower debt levels and cost reduction
efforts, are expected to result in a credit profile that could
warrant an upgrade in the intermediate term.


HOLLINGER INTERNATIONAL: Extends Consent Payment Deadline
---------------------------------------------------------
Hollinger International Inc. (NYSE: HLR) announced, in connection
with the previously announced tender offer and consent
solicitation by its subsidiary Hollinger International Publishing
Inc. for Publishing's outstanding 9% Senior Notes due 2010,
Publishing is amending the Total Consideration and extending the
consent payment deadline.

As described in Publishing's Offer to Purchase and Consent
Solicitation Statement dated June 24, 2004, the Total
Consideration is determined by reference to a fixed spread over
the bid-side yield to maturity of the 2-5/8% U.S. Treasury Note
due November 15, 2006. Publishing is amending the fixed spread
from 100 basis points to 50 basis points, and the Statement is
hereby deemed amended to so provide. All other terms relating to
the determination of the Total Consideration and the Tender Offer
Consideration will remain as described in the Statement.

In addition, Publishing is extending the Consent Payment Deadline.  
The Consent Payment Deadline, which was scheduled to expire at
5:00 p.m., New York City time, on July 8, 2004, is extended to
5:00 p.m., New York City time, on July 15, 2004, unless further
extended. Holders who validly tender their Notes by the Consent
Payment Deadline will be entitled to a consent payment of $30 per
$1,000 principal amount of Notes as part of the Total
Consideration.

The tender offer will expire at 12:00 midnight, New York City
time, on July 30, 2004, unless extended.  The payment date in
respect of Notes validly tendered on or prior to the Consent
Payment Deadline is expected to be the date of, or a date promptly
following, satisfaction of the conditions to the Offer. The
payment date in respect of Notes validly tendered after the
Consent Payment Deadline but on or prior to the Expiration Time,
is expected to be, subject to the satisfaction of the conditions
to the Offer, the date of or a date promptly following the
Expiration Time.  Notes purchased pursuant to the Offer will be
paid for in immediately available funds on the applicable payment
date.

The Offer is subject to the satisfaction of certain conditions,
including:

     (i)   the consummation of the sale of Telegraph Group Limited
           to Press Acquisitions Limited, which sale shall have
           generated sufficient proceeds to allow Publishing to
           repay all of its borrowings under its existing bank
           credit facility and to purchase all of the Notes in the
           tender offer;

     (ii)  the receipt of the requisite consents from the holders
           of at least a majority in aggregate principal amount of
           Notes and the execution of a supplemental indenture
           giving effect to the proposed amendments to the
           indenture for the Notes described above; and

     (iii) certain other customary conditions.

Wachovia Securities is the exclusive Dealer Manager and
Solicitation Agent for the tender offer and consent solicitation.  
Questions regarding the terms of the tender offer or consent
solicitation should be directed to Wachovia Securities at
(704) 715-8341 or toll-free at (866) 309-6316.  The Depositary and
Information Agent is Global Bondholder Services Corporation.  Any
questions or requests for assistance or additional copies of
documents may be directed to the Information Agent at
(212) 430-3774 or toll-free at (866) 470-3800.
    
         About Hollinger International Publishing Inc.

Publishing is a wholly owned subsidiary of Hollinger International
Inc., which is a leading publisher of English-language newspapers
in the United States, the U.K. and Israel with a smaller presence
in Canada.  In addition, it owns or has interests in over 250
other publications, including non-daily newspapers and magazines.  
Included among its 144 paid newspapers are the Chicago Group's
Chicago Sun-Times, the U.K. Newspaper Group's The Daily
Telegraph and the Community Group's Jerusalem Post.

                         *     *     *

As reported in the Troubled Company Reporter's March 17, 2004
edition, Hollinger International Inc. (NYSE: HLR) announced that
primarily as a result of the ongoing investigation being conducted
by the Special Committee of the Company's Board of Directors, as
well as the disruption of management services provided to the
Company arising from its ongoing dispute with Ravelston
Corporation Limited, the Company is not able to complete its
financial reporting process and its audited financial statements
for inclusion in the Annual Report on Form 10-K for fiscal year
2003 by the filing deadline.  The Company intends to complete its
financial reporting process as soon as practicable after the
completion of the investigation by the Special Committee, and then
promptly file the 10-K.

The company's September 30, 2003, balance sheet shows a working
capital deficit of about $293 million.


HORIZON LINES: Carlyle Closes $650 Million Sale to Castle Harlan
----------------------------------------------------------------
Global private equity firm The Carlyle Group announced that it has
closed its sale of Horizon Lines, the nation's leading Jones Act
container shipping company, to private equity firm Castle Harlan
for a purchase price of $650 million. Carlyle acquired its
interest in Horizon Lines, formerly known as CSX Lines, from CSX
Corp. in February 2003 in a recapitalization transaction valued at
$300 million. Carlyle's sale yielded a return of more than 5x on
invested equity.

Carlyle Managing Director and head of the automotive and
transportation group, Greg Ledford, said, "Our experience with
Horizon has been exemplary from start to finish. We've created
tremendous value for our investors while helping to establish
Horizon Lines as a truly independent and stand alone company. We
wish Chuck Raymond and the Horizon team well as they take the
company to the next level of profitability and success."

Based in Charlotte, North Carolina, Horizon Lines is the nation's
largest ocean transportation company, with 16 vessels providing
ocean transportation and logistics services from the U.S. mainland
to Alaska, Hawaii / Guam, and Puerto Rico. Horizon Lines is the
only vessel operator to serve all three of the major Jones Act
trades. Under the Jones Act, the marine trade between U.S. ports
is limited to U.S.-owned and organized companies operating U.S.-
built and U.S.-flagged vessels manned predominantly by U.S.-
citizen crews.

Goldman, Sachs & Co. and Latham & Watkins LLP advised Carlyle on
the transaction.

The Carlyle Group is a global private equity firm with more than
$18.3 billion under management. Carlyle generates extraordinary
returns for its investors by employing a conservative, proven, and
disciplined approach. Carlyle invests in buyouts, venture, real
estate, and leveraged finance in North America, Europe, and Asia,
focusing on aerospace & defense, automotive & transportation,
consumer, energy & power, healthcare, industrial, technology &
business services, and telecommunications & media. Since 1987, the
firm has invested $10.8 billion of equity in 317 transactions. The
Carlyle Group employs more than 500 people in 14 countries. In the
aggregate, Carlyle portfolio companies have more than $31 billion
in revenue and employ more than 151,000 people around the world.
Visit http://www.carlyle.com/for additional information.

Horizon Lines is one of the leading ocean cargo carriers operating  
between the Continental U.S. and Alaska, Puerto Rico, Hawaii, and  
Guam. Horizon Lines operates under the Jones Act, which requires  
cargo shipments between U.S. ports to be carried on U.S.-built  
vessels registered in the U.S. and crewed by U.S. citizens. The  
Jones Act provides a barrier to entry by prohibiting direct  
competition from foreign-flagged vessels. Customers include major  
manufacturing and consumer products companies that provide food  
and other staples to Alaska, Puerto Rico, Hawaii, and Guam.  
Competition from other modes of transportation is limited due to  
cost and geographic considerations.

                     *   *   *

As reported in the Troubled Company Reporter's June 28, 2004
edition, Standard & Poor's Ratings Services assigned its 'B+'
corporate credit rating to Horizon Lines Holding Corp. and lowered
its ratings on subsidiary Horizon Lines LLC to 'B+' from 'BB-'.  
Ratings on Horizon Lines LLC were removed from CreditWatch, where  
they were placed on May 26, 2004, following the announcement that  
The Carlyle Group had agreed to sell its interest in Horizon Lines  
to Castle Harlan Inc., another private equity firm. The  
transaction will result in a new entity, Horizon Lines Holdings  
Corp., which will include Horizon Lines LLC as one of its  
subsidiaries.

At the same time, Standard & Poor's assigned its 'B+' rating to  
the company's $25 million secured revolving credit facility, due  
2009, its 'B+' rating to the company's $250 million secured term  
loan, due 2011, and its 'B-' rating to the company's proposed $250  
million senior unsecured notes due 2012. Horizon Lines Holdings  
Corp. and Horizon Lines LLC are co-issuers and co-borrowers of the  
bank facility and notes offering. The bank facility is rated the  
same as the corporate credit rating, indicating an expectation of  
substantial recovery (80% to 100%) of principal in the event of  
default. Proceeds from the bank facility and senior secured notes  
will be used to finance Castle Harlan's $650 million acquisition  
of the company from The Carlyle Group. The rating outlook is  
stable.  

"The rating action reflects Horizon Lines' increased financial  
obligations and somewhat weakened financial profile after the  
acquisition by Castle Harlan," said Standard & Poor's credit  
analyst Kenneth L. Farer. Pro forma, Charlotte, North Carolina-
based Horizon Lines has lease-adjusted debt of approximately $670  
million, with debt to capital of 80%, compared with $406 million  
of lease-adjusted debt on March 31, 2004.


HUDSON RESPIRATORY: Teleflex Inc. Completes Senior Note Financing
-----------------------------------------------------------------
Teleflex Incorporated (NYSE:TFX) announced the closing of a Senior
Note financing for its recently completed acquisition of Hudson
Respiratory Care, Inc. (Hudson).

The offering of $350 million in Senior Notes was priced at 5.23%
to 5.85% depending on the maturity. The notes consist of $150
million of seven-year notes, $100 million of ten-year notes, and
$100 million of twelve-year notes. Rates are fixed over the tenure
of the notes.

Banc of America Securities, LLC arranged the financing of the
Senior Notes through a group of 23 financial institutions. The
proceeds were used to retire a $350 million bridge facility that
was utilized to complete the Hudson purchase.

                  About Teleflex

Teleflex is a diversified industrial company with annual revenues
of more than $2 billion. The company designs, manufactures and
distributes quality engineered products and services for the
automotive, medical, aerospace, marine and industrial markets
worldwide. Teleflex employs more than 21,000 people worldwide who
focus on providing innovative solutions for customers. Additional
information about Teleflex can be obtained from the company's
website at http://www.teleflex.com/

            About Hudson Respiratory Care, Inc.

Hudson RCI -- http://www.hudsonrci.com/-- is a privately held  
medical manufacturing firm specializing in disposable products for
respiratory care and anesthesia. Corporate headquarters are
located in Temecula, California, with a European office in
Upplands Vasby, Sweden. Hudson RCI maintains manufacturing
facilities in California, Illinois, Mexico, and Malaysia.
Distribution centers located in California, Illinois, and the
Netherlands service the needs of a vast network of distributors
around the world. A team of 80 domestic and international sales
representatives, supported by clinical and marketing personnel
located in the Temecula and Stockholm offices, provide sales,
service, technical support, and clinical information on Hudson
RCI's broad range of respiratory care and anesthesia products.

At March 31, 2004, Hudson Respiratory Care's balance sheet shows a
stockholders' deficit of $168,019,000 compared to a deficit of
$167,915,000 at December 31, 2003.


INTERSTATE BAKERIES: Names Ronald B. Hutchison EVP and CFO
----------------------------------------------------------
Interstate Bakeries Corporation (NYSE:IBC), the nation's largest
baker and distributor of fresh-baked bread and sweet goods, named
Ronald B. Hutchison as Executive Vice President and Chief
Financial Officer for IBC effective immediately.  He will report
directly to CEO James Elsesser and will work closely with Mr.
Elsesser and other members of senior management to consolidate
operations and improve profitability. The Chief Financial Officer
position had been open since the retirement of Frank W. Coffey as
CFO in May of 2003.

"Ron brings a strong expertise in corporate finance and complex
organizations," said James R. Elsesser, Chairman and Chief
Executive Officer. "He will be a key participant in our
refinancing activities and a major contributor in IBC's efforts to
improve our operations, systems and financial performance."

Hutchison, 54, joins IBC after one year at Aurora Foods in St.
Louis where he was Executive Vice President, responsible for
overseeing Aurora's restructuring and the negotiation of its
merger with Pinnacle Foods. From 2002 to 2003, Mr. Hutchison was
Executive Vice President for Kmart Corporation, where he oversaw
the Company's reorganization. Prior to joining Kmart, Mr.
Hutchison was Chief Financial Officer of Advantica Restaurant
Group, Inc., parent company of the Denny's Corporation restaurant
chain. Mr. Hutchison is a graduate of the University of Akron with
a bachelor's degree in accounting and a Certified Public
Accountant. Members of IBC's senior management who will report
directly to Mr. Hutchison include Paul E. Yarick, Senior Vice
President -- Finance and Treasurer, and Laura D. Robb, Vice
President and Corporate Controller.

Separately, IBC announced that the Audit Committee of its Board of
Directors had retained the law firm of Skadden, Arps, Slate,
Meagher & Flom LLP to investigate the Company's manner for setting
its workers' compensation reserves and other reserves. As
previously announced on June 3, 2004, the Company increased its
reserve for workers' compensation during fiscal 2004 with a charge
to pretax income of approximately $40 million. The Company
currently expects that all or a portion of this charge relates to
quarters of fiscal 2004 prior to the fourth quarter, although the
Company's review has not been finalized. If the charge is taken in
a quarter other than the fourth quarter, the Company will be
required to restate its financial statements for the appropriate
prior quarter(s).

IBC does not expect to release its earnings for the fourth quarter
and fiscal 2004 until the Audit Committee has reviewed the results
of the investigation.

                      About the Company

Interstate Bakeries Corporation is the largest baker and  
distributor of fresh baked bread and sweet goods in the U.S. under  
various national brand names including Wonder, Hostess and Home  
Pride, as well as regional brand names such as Butternut, Dolly  
Madison, Drake's and Merita. The Company, with 55 bread and cake  
bakeries and more than 1,000 distribution centers located in  
strategic markets from coast to coast, is headquartered in Kansas  
City, Missouri.  

                         *   *   *

In its Form 10-Q for the quarterly period ended March 6, 2004,
Interstate Bakeries Corporation reports:

               Capital Resources and Liquidity

"Cash from operating activities for the forty weeks ended March 6,
2004 was $100,143,000, down $26,719,000 from cash generated in the
comparable period of fiscal 2003 of $126,862,000. This decrease is
primarily attributable to a decrease in net income of $20,308,000
and working capital variances.

"We believe cash from ongoing operations, along with our borrowing
capacity under our credit facilities, will be sufficient to fund
our currently anticipated needs through fiscal 2004. However,
while we have certain additional borrowing capacity under our
senior secured credit facilities, the agreements with respect to
those credit facilities contain certain financial covenants that
have been, by amendment, relaxed through the first fiscal quarter
of fiscal 2005, at which point the covenants revert to their
original more stringent level. We may not be able to meet the
relaxed covenants at fiscal year end, or the original covenants at
the end of the first quarter of fiscal 2005, and during the fourth
quarter of fiscal 2004 we will seek a further amendment from the
lenders under these facilities.

"To deal with these issues, we are actively exploring options for
refinancing our debt. We plan to execute one or more such
transactions. There is no assurance that amendments to our credit
facility will be obtained or that any transactions will be
consummated.

"Projected cash needs for fiscal 2005 have not yet been finalized,
but as the information herein indicates, cash demands will be
substantial in relation to operating cash flows. In March 2004, we
announced that our Board of Directors had suspended the dividend
on IBC common stock effective for the fourth quarter of fiscal
2004."


KAISER ALUMINUM: Court Okays Payment To Century & Noranda
---------------------------------------------------------
The Bankruptcy Court authorizes Kaiser Aluminum Corporation , if
the obligation arises, to pay Century Aluminum Company and Noranda
Aluminum, Inc. -- comprising Gramercy Alumina, LLC, and St. Ann
Bauxite Limited -- the $1,050,00 Termination Fee in accordance
with the terms of the Purchase Agreement among Gramercy Alumina
and Bauxite Limited, and the Debtors.

The parties entered into a letter agreement on June 18, 2004,
which modifies the termination rights under the Purchase
Agreement.  The modified provisions provides that:

   (a) The Debtors no longer have any right or ability to
       terminate the Purchase Agreement pursuant to:

        (i) a new labor agreement that may be reached by Gramercy
            Alumina and Bauxite Limited, and the USWA; and

       (ii) the Debtors not reaching an agreement with USWA with
            respect to their release from any obligations arising
            from or relating to a labor agreement from and after
            the Effective Time -- 11:59 p.m. on the closing date
            -- with respect to USWA-represented employees and
            employed at the Gramercy Site; provided that the
            Debtors may no longer exercise their rights of
            termination after they have reached an agreement with
            the USWA with respect to an exit agreement;

   (b) Gramercy Alumina and Bauxite Limited no longer have the
       right or ability to terminate the Purchase Agreement
       pursuant to these terms:

          (i) if Gramercy Alumina and Bauxite Limited are the
              prevailing bidder before the conclusion of the
              Sale Hearing, which has not concluded by:

              -- the date that is 90 calendar days after the date
                 of the Purchase Agreement; or

              -- a later date as is agreed to in writing by
                 the parties;

         (ii) if on or before the Pre-Hearing Termination Date,
              Gramercy Alumina and Bauxite Limited has not agreed
              with the USWA regarding a new labor agreement -- or
              the agreement has not been ratified by the Gramercy
              Represented Employees;

        (iii) before the earlier of:

              -- receipt of Gramercy Alumina and Bauxite Limited
                 of written evidence that the Debtors have agreed
                 with the USWA regarding a Gramercy Exit
                 Agreement; and

              -- waiver by the Debtors of their right to
                 terminate, if by the Pre-Hearing Termination
                 Date, the Debtors have not agreed with the USWA
                 regarding a Gramercy Exit Agreement;

   (c) Before August 16, 2004:

       * the Debtors will not exercise the termination rights if
         either:

         1) before the Pre-Hearing Termination Date, Gramercy
            Alumina and Bauxite Limited has not obtained an
            agreement and consent between Gramercy Alumina and
            Bauxite Limited and the Jamaican governmental
            entities with respect to a fiscal regime for Gramercy
            Alumina and Bauxite Limited relating to their
            ownership of the Kaiser Bauxite Company Assets,
            including in respect of income taxes, bauxite levies,
            bauxite royalties, property taxes, customs duties,
            asset usage fees and land use, dedication and
            depletion fees, that is consistent with the release
            of the Debtors from any obligation to the Jamaican
            Government Entities arising from the operation of the
            KJBC operations from and after closing; or

         2) by the Pre-Hearing Termination Date, the Debtors
            have not obtained from the Jamaican governmental
            entities an agreement with respect to the release of
            the Debtors from any obligations to the Jamaican
            Government arising from or relating to the operation
            of the Kaiser Jamaica Bauxite Company operations from
            and after the Effective Time -- provided that the
            Debtors may no longer exercise their rights of
            termination and the Debtors have obtained the
            Jamaican Government Release; and

       * Gramercy Alumina and Bauxite Limited will not exercise
         the termination rights if either:

         1) on or before the Pre-Hearing Termination Date,
            Gramercy Alumina and Bauxite Limited will have not
            obtained the agreement and consent from the Jamaican
            Government Entities; or

         2) before the earlier of:

            -- receipt by Gramercy Alumina and Bauxite Limited of
               written evidence that the Debtors have obtained
               the Jamaican Government Entities Release; and

            -- waiver by the Debtors of their right to terminate,
               if, on or before the Pre-Hearing Termination Date,
               the Debtors have not obtained the Jamaican
               Government Entities Release and Gramercy Alumina
               and Bauxite Limited have not received any evidence
               thereof.

Headquartered in Houston, Texas, Kaiser Aluminum Corporation
operates in all principal aspects of the aluminum industry,
including mining bauxite; refining bauxite into alumina;
production of primary aluminum from alumina; and manufacturing
fabricated and semi-fabricated aluminum products.  The Company
filed for chapter 11 protection on February 12, 2002 (Bankr. Del.
Case No. 02-10429).  Corinne Ball, Esq., at Jones, Day, Reavis &
Pogue, represent the Debtors in their restructuring efforts. On
September 30, 2001, the Company listed $3,364,300,000 in assets
and $3,129,400,000 in debts. (Kaiser Bankruptcy News, Issue No.
45; Bankruptcy Creditors' Service, Inc., 215/945-7000)  


JEFFWERBERPETS INC: Case Summary & 20 Largest Unsecured Creditors
-----------------------------------------------------------------
Debtor: Jeffwerberpets Inc.
        1626 North Wilcox Avenue
        Hollywood, California 90028

Bankruptcy Case No.: 04-24697

Type of Business: The Debtor is a multifaceted media and
                  manufacturing company dedicated to promoting
                  the pet lifestyle and selling premium pet
                  products.  See http://www.jeffwerberpets.com/

Chapter 11 Petition Date: July 6, 2004

Court: Central District of California (Los Angeles)

Judge: Maureen Tighe

Debtor's Counsel: Simon H. Langer, Esq.
                  416 South Spalding Drive #6
                  Beverly Hills, CA 90212
                  Tel: 310-552-6977

Estimated Assets: $0 to $50,000

Estimated Debts:  $1 Million to $10 Million

Debtor's 20 Largest Unsecured Creditors:

Entity                        Nature Of Claim       Claim Amount
------                        ---------------       ------------
Sunny and Debbie Sassoon      Note                      $140,000
Family Trust

Victor and Michelle Sassoon   Note                      $100,000
Family Trust

Estate of Lloyd Rigler        Note                       $85,000

Covington & Burling           Professional Legal         $83,000
                              Services

Seewack Family Trust          Note                       $65,000

Bruce Suggs                   Note                       $50,000

Clarence Barksdale IRA        Note                       $50,000

Gilbert West                  Trade debt                 $40,000

Overnight Transportation      Trade debt                 $40,000

Classic Containers            Trade debt                 $34,000

WetNOZ International          Trade debt                 $33,000

Premier Pet Products, LLC     Trade debt                 $26,625

Hemisphere Laboratories       Trade debt                 $28,000

Mario Ernst                   Note                       $25,000

Snugga Luvs PM Enterprises,   Trade debt                 $20,000
Inc.

Pro-form Laboratories         Trade debt                 $12,500

Calla Associates Inc.         Trade debt                 $10,000

Lewis T. Mann III             Note                       $10,000

David Maron                   Note                       $10,000

American Fulfillment          Trade debt                  $9,500


KROLL INC: Adopts Merger Agreement with Marsh & McLennan Companies
------------------------------------------------------------------
At its special meeting of stockholders held Thursday, Kroll Inc.
(Nasdaq:KROL) stockholders adopted the Agreement and Plan of
Merger with Marsh & McLennan Companies, Inc.  As previously
announced on May 18, 2004, Kroll and MMC have entered into a
merger agreement pursuant to which Kroll would become a subsidiary
of MMC, and Kroll stockholders would receive $37 in cash for each
of their shares. Kroll anticipates that the merger will be
completed later Thursday, subject to the satisfaction or waiver of
all other conditions to the merger.

                      About the Company

Kroll Inc. (NASDAQ: KROL), the world's leading independent risk
consulting company, provides a broad range of investigative,
intelligence, financial, security and technology services to help
clients reduce risks, solve problems and capitalize on
opportunities. Headquartered in New York with more than 60 offices
on six continents, Kroll has a multidisciplinary corps of more
than 2,600 employees and serves a global clientele of law firms,
financial institutions, corporations, non-profit institutions,
government agencies and individuals. Kroll has four business
groups: (1) Background Screening, which provides employee,
mortgage and resident screening, substance abuse testing, and
identity theft services; (2) Consulting Services, which provides
investigations, intelligence, security, forensic accounting,
litigation consulting, and valuation services; (3) Corporate
Advisory & Restructuring, which provides corporate restructuring,
operational turnaround, strategic advisory services, financial
crisis management, and corporate finance services; and (4)
Technology Services, which provides data recovery, electronic
discovery, and computer forensics services and software. For more
information, please visit: http://www.krollworldwide.com/

                         *   *   *

As reported in the Troubled Company Reporter's May 21, 2004
edition, Standard & Poor's Ratings Services placed its ratings on
Kroll Inc., including its 'BB-' corporate credit rating, on
CreditWatch with positive implications following Marsh & McLennan
Cos.'s (MMC;AA-/Watch Neg/A-1+) announcement that it intends to
acquire Kroll for $1.95 billion in cash, with a significant
portion to be financed by prospective debt transactions.

In resolving the CreditWatch listing for Kroll, Standard & Poor's
will review the terms of the transaction, in particular, MMC's
intentions with regard to the existing indebtedness of Kroll.


LES BOUTIQUES: National Bank Financial Recommends Modified Offer
----------------------------------------------------------------
National Bank Financial is pleased to announce that the committee
representing its clients that hold debentures in Boutiques San
Francisco has reached an agreement regarding the modified offer
for debenture holders of as part of the company's restructuring.

"This modified offer is beneficial for all parties. We were faced
with the challenge of finding a solution that would allow us to
protect the interests of our clients, while respecting the
integrity and viability of the restructuring proposal presented by
Boutiques San Francisco. It is clearly a step in the right
direction for debenture holders and for Boutiques San Francisco,
and we are pleased to continue to participate in the future of the
company," said Mr. Luc Paiement, President of Individual Investor
Services, National Bank Financial.

Overall, the proposal allows for these debenture holders to obtain
convertible debentures identical to those held by the new
investors.

National Bank Financial is one of Canada's leading brokerage
firms, with over 3,200 employees in more than 100 offices in
Canada, the United States and Europe. It is a wholly owned
subsidiary of the National Bank of Canada and offers a wide array
of financial services to individual investors, private and
public companies and government organizations. National Bank
Financial is a member of the Canadian Investor Protection Fund.
Its American counterpart, Putnam Lovell NBF Securities Inc., is an
investment bank that serves the financial services sector in the
United States.

Les Boutiques San Francisco Incorporees operates 137 stores in
Quebec, Ontario, British Columbia and Alberta under five banners
and targeting as many market segments. The Corporation also
operates a chain of four Les Ailes de La Mode specialty department
stores.


LES BOUTIQUES: Noteholders Approve Amended Plan of Compromise
-------------------------------------------------------------
Les Boutiques San Francisco Incorporees (TSX:SF.A) (TSX:SF.B)
announced that, at a meeting held earlier Thursday, the holders of
the 8% convertible unsecured subordinated debentures due 2008  
approved the amended plan of compromise and arrangement, a crucial
step in ensuring the continuity of the Corporation.

The modified offer includes the cancellation of the issued and
outstanding 8% Debentures with an aggregate par value of
$14,992,000, and the issuance to the holders of 8% Debentures new
debentures with a par value of $6,146,720 representing 41% of the
total par value of the 8% Debentures. The new debentures will have
a four-year term, they will be unsecured and will bear interest at
a per annum rate of 12%. They will be redeemable at the discretion
of the Corporation after the third anniversary of their issuance
and may be converted, at the discretion of the holder, at any time
up to maturity, in whole or in part, into Class B Subordinate
Voting Shares of the Corporation at the conversion price of $0.50
per share.

On July 5th, 93.4% of the chirographic creditors of the
Corporation, 81.9% of Les Ailes de la Mode Incorporees creditors
and 100% of Les Editions San Francisco Incorporees creditors
approved the Amended Plan. The Amended Plan provides that the
creditors of the Corporation will receive an aggregate amount
representing 37% of their ordinary claims and creditors of Les
Ailes an aggregate amount representing 10% of their ordinary
claims. As for creditors of Les Editions, it is expected in the
Amended Plan that all debt repayments received by Les Editions in
installments be transferred to the Controller for distribution to
creditors of Les Editions proportionate to their debt issue up to
the amount of their proven claim.

"The approval of the Amended Plan by debenture holders marks an
important step in a process that started December 17, 2003, when
the Corporation submitted a request to the Quebec Superior Court
to exercise its rights under the Companies' Creditors Arrangement
Act. Since that time, the restructuring team has worked without
respite to resolve definitively the financial problems of the
Corporation in order start again in a viable way and in a context
of continuity," indicated Mr. Gaetan Frigon, Chief Restructuring
Officer. "Over the last months, among other things, we proceeded
with the sale of non-strategic activities, the closing of
unprofitable stores, the reduction of general administration
expenses as well as a reduction in the square-footage of the
downtown Montreal Les Ailes de la Mode store and the signing of an
agreement with Ivanhoe Cambridge," he added.

"I am happy to be able to say: mission accomplished. I must thank
all who have, in one way or another, contributed to successfully
meeting the challenge of ensuring the continuity of a business
that has been recognized for 25 years for its dynamism, vitality
and originality," concluded Mr. Frigon.

The next steps concerning the restructuring of the Corporation
include submission tomorrow in Quebec Superior Court of a request
to ratify the amended transaction and arrangement plan of the
Corporation and the closing, before the end of July, of a private
placement by a group of investors.

The Amended Plan, the court orders issued under the Companies'
Creditors Arrangement Act as well as the management reports of RSM
Richter Inc., the court-appointed monitor, are available at
http://www.rsmrichter.com/Additional information regarding the  
Corporation, including its annual and interim financial
statements, is available through SEDAR at http://www.sedar.com/

Les Boutiques San Francisco Incorporees operates 137 stores in   
Quebec, Ontario, British Columbia and Alberta under five banners   
and targeting as many market segments. As part of its
restructuring process, the Corporation has sold its Boutiques San
Francisco as well as two lingerie boutiques, Victoire Delage and
Moments Intimes. The Corporation still operates four Les Ailes de
la Mode stores and a network of bathing suit stores operating
under the banners Bikini Village and San Francisco Maillots.


LIBERATE TECH: Bankruptcy Case Transferred to San Francisco
-----------------------------------------------------------
On April 30, 2004, Liberate Technologies, a Delaware corporation,
filed a voluntary petition under Chapter 11 of Title 11 of the
United States Code.  The Chapter 11 Case was filed in the United
States Bankruptcy Court for the District of Delaware (Bankr. Case
No. 04-11299) and venue was subsequently transferred to the United
States Bankruptcy Court for the Northern District of California,
San Francisco Division (Bankr. Case No. 04-31394)(Carlson, J.).

In San Francisco, Liberate Technologies is represented by:

          Crista Morrow, Esq.
          Desmond J. Cussen, Esq.
          Gibson, Dunn and Crutcher
          One Montgomery St., 31st Fl.
          San Francisco, CA 94104
          Telephone (415) 393-8247

For several months prior to the Petition Date, the Debtor's Board
of Directors considered and discussed the Debtor's ongoing
restructuring activities, business activities and prospects, and
potential strategic alternatives.  On April 26, 2004, the Board
authorized the Debtor to file a voluntary petition under Chapter
11 of the Bankruptcy Code in an effort to reorganize its business.  
In reaching its decision, the Board considered a number of factors
including the Debtor's need to strengthen its financial position
and reduce its cost structure.  In particular, the Debtor has a
number of potential liabilities and exposures that it is seeking
to resolve in this Chapter 11 Case, including those arising from
leases on excess facilities in San Carlos, California and the
United Kingdom, claims from former employees, equipment leases,
outstanding contracts with certain vendors and licensees, and
pending shareholder and patent litigations.  In addition the
Debtor has retained (subject to approval of the Bankruptcy Court)
Allen & Company as its financial advisor and investment banker to
advise the Debtor on potential strategic alternatives that may
arise.


MCMILLIN COS: S&P Assigns B+ Rating to Corporate Credit
-------------------------------------------------------
Standard & Poor's Ratings Services assigned its 'B+' corporate
credit rating to McMillin Cos. LLC. In addition, a 'B-' rating was
assigned to the company's $70 million 12.875% senior secured
notes. The outlook is stable.

"The ratings acknowledge the company's good market position and
improved diversity, as well as above average profitability and
debt protection measures," said Standard & Poor's credit analyst
George Skoufis. "The company however, is still a relatively small,
concentrated builder, with higher-than-average leverage and
limited financial flexibility, as well as a complex financial
profile due to its reliance on joint ventures."

A growing backlog of ordered homes should provide predictable
revenues in the near term, and demand for housing should remain
relatively strong due to the currently attractive supply/demand
conditions in Southern California. Debt protection measures are
strong for the assigned corporate credit rating, but could come
under pressure as interest rates begin to steadily rise, given
exposure to variable-rate debt. Standard & Poor's expects that
management would manage its inventory and development pursuits if
the housing market slows so as to maintain appropriate financial
measures.


MEDIABAY INC: Names Yarvis and Neuwirth as Independent Directors
----------------------------------------------------------------
MediaBay, Inc. (Nasdaq: MBAY), a leading spoken audio media
marketing company, appointed:

     * Stephen Yarvis and

     * Paul D. Neuwirth

as independent directors to the Company's Board of Directors.  
Mr. Neuwirth has also been appointed to the Audit Committee.

Paul D. Neuwirth is a certified public accountant and the former
Managing Partner of the Philadelphia office of Grant Thornton LLP,
the fifth largest international accounting firm in the world. Mr.
Neuwirth currently serves as consultant to Grant Thornton on
client issues and on litigation cases since his retirement
following over 30 years of service. In addition, since 1979, he
has been on the faculty of The Wharton School of the University of
Pennsylvania. Mr. Neuwirth is a member of the American Institute
of CPAs, and served as a member and chairman of its Insurance
Trust Committee for 12 years. Mr. Neuwirth holds a BBA degree from
Baruch College.

Stephen Yarvis joins MediaBay following a succession of senior
sales and marketing positions with some of the largest consumer
goods companies in the country including Revlon, Colgate Palmolive
Mennen, Warner Lambert, and Pepsi-Cola. Most recently, Mr. Yarvis
served as Senior Vice President of Government Sales at Revlon,
averaging 13% annual growth and increasing operating margins by
28%. He was responsible for restructuring the division and
transitioning from direct sales to a broker network. Mr. Yarvis
holds an MBA from New York University, and a BA from Hobart
College.

MediaBay's Acting Chairman of the Board, John Levy commented, "We
are pleased to welcome Stephen and Paul to our Board. Stephen's
experience in consumer sales and marketing will prove valuable as
we move forward with our strategy to digitize MediaBay and
capitalize on our robust direct marketing and wholesale
distribution channels. Paul's vast accounting and auditing
experience, both as a practitioner and a member of the Wharton
faculty will enhance our audit committee and assist the Board in
its corporate governance role."

The Company also announced the resignation of Mark Hershhorn from
the Board of Directors.

MediaBay, Inc. (Nasdaq: MBAY) is a multi-channel, media marketing  
company specializing in the $800 million audiobook industry and  
old-time radio distribution. MediaBay's industry-leading content  
library includes over 60,000 classic radio programs, 3,500 film  
and television programs and thousands of audiobooks. MediaBay  
distributes content through more than 20 million direct mail  
catalogs; streaming and downloadable audio over the Internet; over  
7,000 retail outlets; and a 260 station syndicated radio show. For  
more information on MediaBay, visit http://www.MediaBay.com/  

                        *   *   *

As reported in the Troubled Company Reporter's April 23, 2004  
edition, MediaBay, Inc. (Nasdaq: MBAY), filed its Annual Report on  
Form 10-K for the year ended December 31, 2003 with the Securities  
and Exchange Commission on April 14, 2004.

Included in the Company's 10-K filing are consolidated financial  
statements audited by Amper Politziner & Mattia, independent  
auditors, as of and for the year ended December 31, 2003. Amper  
Politziner & Mattia has issued an opinion with respect to the  
financial statements, which includes an explanatory paragraph that  
raises substantial doubt about the Company's ability to continue  
as a going concern.

In particular, the auditors' opinion states, "The accompanying  
financial statements have been prepared assuming that the Company  
will continue as a going concern. As discussed in Note 1 to the  
financial statements, the Company has suffered recurring losses  
from operations and has a working capital deficiency, which raise  
substantial doubt about its ability to continue as a going  
concern. Management's plans regarding those matters also are  
described in Note 1. The financial statements do not include any  
adjustments that might result from the outcome of the  
uncertainty."

MediaBay CEO Jeffrey Dittus commented, "The Company is exploring  
various financing alternatives including refinancing and  
restructuring its debt to meet its obligations, however there can  
be no assurance that any transactions will be completed."


MERRY-GO-ROUND: Trustee Hires Tom Hays as Turnaround Expert
-----------------------------------------------------------
Deborah H. Devan, the Chapter 7 Trustee overseeing Merry-Go-Round
Enterprises, Inc.'s liquidation, asks the U.S. Bankruptcy Court
for the District of Maryland for permission to hire T. Hays, LLC,
and consult with Thomas D. Hays, III, in his capacity as an expert
in the area of turnaround management of a Chapter 11 Debtor-in-
Possession.  Mr. Mays is a Certified Turnaround Professional and a
principal of NachmanHaysBrownstein, Inc.  Mr. Hays is a past
Chairman of the Turnaround Management Association and a past
Chairman of the Association of Certified Turnaround
Professionals.   

Mr. Hays will assist the Trustee as she continues her bid to
disallow roughly $2.5 million of professional fees paid to the law
firm of Swidler & Berlin, Ltd.  As previously reported in the
Troubled Company Reporter, Ms. Devan hired Prof. Geoffrey C.
Hazard, Jr., at the University of Pennsylvania Law School, as a
legal ethics expert in this matter.  

Swidler represented Merry-Go-Round in its failed attempt to
restructure under chapter 11.  Swidler, court papers allege,
failed to disclose critical relationships with Ernst & Young,
Merry-Go-Round's restructuring consultant.  Ms. Devan extracted a
$186 million settlement from E&Y in a lawsuit settled a couple of
years ago.   

Mr. Hays will bill the estate $435 per hour for his services.  Mr.
Hays previously assisted in the litigation against Ernst & Young.   

To date, Ms. Devan has collected more than $270 million for the
benefit of Merry-Go-Round's creditors.  All allowed chapter 11
administrative claims (some 2,500 claims totaling $21.4 million)
have been paid in full and Ms. Devan has made a 30% distribution
to general unsecured creditors.  Following that distribution, Ms.
Devan sat on approximately $37 million of cash.  Denying $2.5
million in compensation to Swidler on account of its chapter 11
claim should allow a greater percentage of that $37 million to
flow to general unsecured creditors.

Merry-Go-Round filed chapter 11 bankruptcy protection in 1994
(Bankr. Md. Case No. 94-5-0161-SD).  Following a couple of failed
attempts to find its place on the retail landscape, the case
converted to a chapter 7 liquidation in early 1996.  Since that
time, Ms. Devan has worked on winding-up the Debtors' estates.

Cynthia L. Leppert, Esq., and Jason N. St. John Esq., at
Neuberger, Quinn, Gielen, Rubin & Gibber, P.A., in Baltimore
represent Ms. Devan.


MERRILL LYNCH: Fitch Affirms Classes H & J's Junk Ratings  
---------------------------------------------------------
Fitch Ratings affirms Merrill Lynch Mortgage Investors, Inc.'s
mortgage pass-through certificates, series 1999-C1, as follows:

               --$66.1 million class A-1 at 'AAA';
               --$337.8 million class A-2 at 'AAA';
               --Interest only class IO at 'AAA';
               --$32.6 million class B at 'AA';
               --$26.7 million class C at 'A';
               --$8.9 million class D at 'A-';
               --$20.7 million class E at 'BBB';
               --$7.4 million class F at 'BB+';
               --$23.7 million class G at 'B';
               --$20.7 million class H at 'CC';
               --$3.0 million class J at 'C'.

Fitch does not rate the $13.3 million class K.

The affirmations are the result of increased subordination levels
offsetting the expected losses, which are in line with the loss
expectations from Fitch's previous formal review.

The collateral has paid down 9.5% to $536.3 million as of June
2004 from $592.5 million at issuance.

Currently, there are seven loans in special servicing (12.5%),
consisting of two real estate owned properties (3.2%), two loans
in foreclosure (4.4%), one 90 days or more delinquent loan (2.9%),
and two loans that are current. The largest of these loans (3.3%)
is collateralized by an office property in Salt Lake City, UT. The
loan is in foreclosure and a receiver is in place. The property is
approximately 35% occupied, and according to the special servicer,
ORIX Capital Markets, prospective tenants are interested in
leasing space. The second largest specially serviced loan (2.9%)
is 90 days or more delinquent and collateralized by an office
property located in Irving, TX. The borrower has requested a loan
restructure and ORIX is evaluating workout options. The third
largest specially serviced loan (2.8%) is collateralized by two
multifamily properties located in Virginia. The original loan was
collateralized by four properties; however, two of the four were
sold after the loan became REO. Proceeds of the two sold
properties were used to pay down the outstanding loan amount. ORIX
is currently marketing both remaining properties for sale. Losses
are expected on most of the loans in special servicing.

Fitch is also concerned with the high percentage of loans with
year-end 2003 DSCRs less than 1.0x. As of June 2004, ORIX, as
master servicer, collected 74.3% of YE 2003 operating statements.
Loans with DSCRs less than 1.0x constitute 12.2% of the pool. In
addition, there are six loans collateralized by single tenant
Gateway 2000 stores (1.7%). These properties are vacant and the
likelihood of releasing is unknown at this time. The loans remain
current, and are on the master servicer's watchlist.

ORIX is pursuing a representation and warranty claim against one
of the loan sellers due to several matters, including
presecuritization issues such as loan default, property condition,
and fraud. While this lawsuit may lessen or eliminate losses to
the trust, Fitch will assume losses based on property valuations
until the lawsuit's outcome is known.


MIRAVANT: Demands Immediate Delisting From Berlin Stock Exchange
----------------------------------------------------------------
Miravant Medical Technologies (OTCBB:MRVT), a pharmaceutical
development company specializing in PhotoPoint(R) photodynamic
therapy, has demanded an immediate delisting from the Berlin Stock
Exchange in an attempt to prevent potential manipulative trading
practices that are banned in the United States.

In June 2004, Miravant learned that it was listed on the Berlin
Stock Exchange. The Company did not apply for this listing. Recent
public reports have indicated that traders may attempt to use this
exchange to manipulate stock prices through a practice known as
"naked short selling," which is banned in the United States.
Miravant's management is currently in the process of requesting
immediate removal of Miravant's common stock from this exchange.

Investors interested in purchasing shares of Miravant should only
purchase shares from the NASDAQ Over-The-Counter Bulletin Board
under the symbol: MRVT.

                       About Miravant

Miravant Medical Technologies -- whose March 31, 2004 balance
sheet shows a stockholders' deficit of $8,389,000 -- specializes
in pharmaceuticals and devices for photoselective medicine,
developing its proprietary PhotoPoint photodynamic therapy for
large potential markets in ophthalmology, dermatology,
cardiovascular disease and oncology. PhotoPoint PDT uses
photoreactive drugs to selectively target diseased cells and blood
vessels. The Company has submitted a New Drug Application for the
drug SnET2 for the treatment of patients with wet age-related
macular degeneration. Miravant's cardiovascular program focuses on
life-threatening diseases, with PhotoPoint MV0633 in advanced
preclinical testing for atherosclerosis, atherosclerotic
vulnerable plaque and restenosis.


MORGANS HOTEL: Completes Sale of 90% Interest in Paramount Hotel
----------------------------------------------------------------
Morgans Hotel Group completed the sale of a 90% interest in its
Paramount Hotel in New York City for $128.5 million to Becker
Ventures, a private investment company whose investments have
included the Hard Rock Hotel in Chicago.

This is the latest in a string of positive developments for Ian
Schrager's MHG. On Tuesday, the company announced that it had
entered into a sale/leaseback transaction on its San Francisco
Clift Hotel with affiliates of Divco West Properties, under which
Divco will pay MHG $71 million and MHG will retain a 99 year
leasehold. The transaction also provides that MHG will receive any
profit that might ensue from operations or a capital transaction.

Clift's plan of reorganization incorporating the sale/leaseback
transaction was filed with the United States Bankruptcy Court on
June 30, 2004. The plan and the transaction are subject to
Bankruptcy Court approval. Approval of the plan by the Court is
expected to occur in September 2004. Clift's plan of
reorganization provides for the satisfaction of all of the
company's creditors in full.

"We anticipate being able to make a number of other positive
announcements over the next several weeks," said Ian Schrager,
chief executive officer of MHG. "The lodging markets in which we
operate have shown strong improvement and our properties continue
to outperform the market. They are doing extremely well."


NETWORK INSTALLATION: Relocates Corporate HQ to Irvine, California
------------------------------------------------------------------
Network Installation Corp. (OTC Bulletin Board: NWIS) executed a
new lease and will be relocating its corporate headquarters to
15235 Alton Parkway, Irvine, CA. In order to accommodate the
Company's growth, the 10,000 square foot facility will house
Network Installation's corporate staff as well as the Irvine sales
and management team. The Company is expected to complete its
relocation by August 1, 2004.

                About Network Installation Corp.  
   
Network Installation Corp. -- whose March 31, 2004 balance sheet   
reflects a stockholders' deficit of $1,607,403 -- provides   
communications solutions to the Fortune 1000, Government
Agencies, Municipalities, K-12 and Universities and Multiple
Property Owners. These solutions include the design, installation
and deployment of data, voice and video networks as well as
wireless networks and Wi-Fi. Through its wholly-owned subsidiary
Del Mar Systems International, Inc., the Company also provides
integrated telecom solutions including Voice over Internet
Protocol applications. Network Installation maintains offices in
Irvine, Los Angeles, Gold River and San Marcos, CA; Las Vegas, NV
and Phoenix, AZ. To find out more about the company,
visit http://www.networkinstallationcorp.net/


NEWAVE INC: Partners With IDI Global to Accelerate Current Growth
-----------------------------------------------------------------
NeWave, Inc. (OTC Bulletin Board: NWAV) a provider of membership-
based online products and services through its subsidiary
OnlineSupplier.com, announced an agreement with IDI Global Inc.
(OTC Bulletin Board: IDIB).  The agreement will allow
OnlineSupplier to offer to its members the ability to provide IDI
Global services to their customers.

Kevin Griffith, IDI Global CEO commented, "Given NeWave's
exceptional distribution channel through OnlineSupplier.com, I
believe this partnership will accelerate our current growth. The
partnership with NeWave will initially add in excess of 11,000 new
members within the next 60 days. The residual income added due to
this partnership will continue to build on the primary premise of
our business model."

NeWave CEO Michael Hill stated, "The partnership with IDI will
initially add meaningful in revenue to NeWave over the first sixty
days as well as supply our members with additional services to
offer their customers. We are excited about the opportunity to
establish a new revenue stream and adding IDI to our list of
partners."

                      About IDI Global, Inc.

Internet Development, Inc. is an application service provider of
infrastructure technologies and services that implements
comprehensive Internet-based business solutions. The technology
engine that powers these programs allows both large complex
organizations and small stand-alone businesses to exploit the full
capabilities of the Internet. For additional information regarding
IDI Global, Inc. please visit http://www.idiglobal.com/  

                        About NeWave, Inc.  
  
NeWave, Inc. through its wholly-owned subsidiary   
Onlinesupplier.com offers a comprehensive line of products and   
services at wholesale prices through its online club membership.   
Additionally, NeWave's technology allows both large complex   
organizations and small stand-alone businesses to create, manage,   
and maintain effective website solutions for e-commerce. To find   
out more about NeWave (OTC Bulletin Board: NWAV), visit   
http://www.newave-inc.com/or http://www.onlinesupplier.com/   

                         *     *     *
  
As reported in the Troubled Company Reporter's June 8, 2004   
edition, Kabani & Company's report on the Company's consolidated   
financial statements for the fiscal years ended December 31,
2003 and December 31, 2002 included an explanatory paragraph
wherein they expressed substantial doubt about NeWave's ability
to continue as a going concern.


NEXEN INC: Sets Second Quarter 2004 Earnings and Conference Call
----------------------------------------------------------------
Nexen will announce its second quarter earnings results before
markets open on Thursday morning, July 15, 2004. We will hold
our second quarter conference call that same day at 7:00 a.m.
Mountain Time. Charlie Fischer, President and CEO, and Marvin
Romanow, Executive Vice President and CFO, will discuss our
financial and operating results and expectations for the future.
To listen to the conference call, please call one of these two
lines:

    800-814-4861       (North American Toll-Free)
    416-640-1907       (Toronto or International)

A replay of the call will be available for two weeks starting
11:00 a.m. Eastern Time, July 15, 2004, by calling (416) 640-1917
and entering passcode 21055815 followed by the pound sign. A live
and on demand webcast of the conference call will be available at
http://www.nexeninc.com/  

Nexen Inc. is an independent, Canadian-based global energy and
chemicals company, listed on the Toronto and New York stock
exchanges under the symbol NXY. We are uniquely positioned for
growth in the deep-water Gulf of Mexico, the Athabasca oil sands
of Alberta, the Middle East and West Africa. We add value for
shareholders through successful full-cycle oil and gas exploration
and development, a growing industrial bleaching chemicals
business, and leadership in ethics, integrity and environmental
protection.

                         *   *   *

As previously reported, Standard & Poor's Ratings Services
affirmed its 'BBB' long-term corporate credit and senior unsecured
debt ratings, its 'BBB-' subordinated debt rating and 'BB+'
preferred stock rating on Calgary, Alberta-based Nexen Inc.
following the company's announcement of the 67 million barrels of
oil equivalent negative revision to the company's proven reserves.
The outlook is stable.

Nexen's average business risk profile reflects the company's 811
million boe proven reserve base and strong liquids focus; its
geographically diversified exploration and production operations;
and the business diversification provided through its chemicals
operations. Nexen's moderate financial risk profile reflects the
company's improved financial position achieved through its recent
efforts to reduce debt. In addition, Nexen's financial policies
focus on the diversification of debt types and maturities as a
means of maintaining financial flexibility. Although the company
has both increased capital expenditures and funded debt reduction
on the strength of stronger pricing fundamentals in the recent
past, debt levels could trend higher if Nexen proceeds with its
North American development projects and expands its international
operations in a less robust pricing environment.


NEXTEL FINANCE: S&P Rates $6.2 Billion Credit Facility at BB+
-------------------------------------------------------------
Standard & Poor's Ratings Services assigned its 'BB+' rating to
the proposed $6.2 billion senior secured credit facility of Nextel
Finance Co., a wholly owned subsidiary of Reston, Virginia-based
wireless service provider Nextel Communications Inc. This bank
loan rating is based on preliminary documentation. Existing
ratings on Nextel, including the 'BB+' corporate credit rating,
were affirmed. The outlook remains positive.

While the new bank facility, which comprises a $4 billion revolver
and a $2.2 billion term loan, is secured, it is rated at the same
level as the corporate credit rating since the liens that will be
in place at inception of the new facility are designed to fall
away upon certain, specified credit events. Under Standard &
Poor's corporate ratings criteria, the potential removal of a
security interest at a later date would be reflected immediately
in the rating of the affected obligation. Existing unsecured debt
would remain rated one notch below the corporate credit rating
even if the security is removed from the new bank facility because
it will remain structurally subordinated to the bank debt. Uses of
the new revolver will include the refinancing of Nextel Finance's
term loan A and providing for potential payments, or letter of
credit backing for future payments, to be made in connection with
FCC orders associated with a proposed spectrum swap. Pro forma for
the redemption of the 6% convertible senior notes in second
quarter 2004, consolidated debt was about $9.7 billion at
March 31, 2004.

"Ratings reflect Nextel's good market position within a highly
competitive industry and modest financial leverage," said Standard
& Poor's credit analyst Michael Tsao. The company has successfully
carved a market niche with its proprietary push-to-talk (PTT)
product in what is a highly competitive industry with five other
major and well-financed national players. Nextel's industry-
leading average revenue per user and low subscriber churn, as well
as the slowing pace of wireless growth, will attract increasing
challenges to the company's PTT leadership position. Indeed, other
carriers have either introduced or are planning to roll out their
own PTT-type service. Because Nextel operates an exclusive network
and a large number of subscribers in several sectors have come to
depend on this network for critical services and access to
important user groups, other carriers are expected to find it
difficult to compete directly against the company even when the
quality gap between Nextel's PTT service and those offered by
competitors narrows in the next several years.


NEXTWAVE: Auction Attracts Winning Bids Totaling $973.5 Million
---------------------------------------------------------------
Verizon Wireless and MetroPCS emerged as winners from NextWave
Telecom's spectrum license rights auction.  Verizon Wireless
placed the winning bid of $930 million for a 10 MHz license
principally covering the greater New York City metropolitan area,
while MetroPCS placed winning bids totaling $43.5 million for 10
MHz licenses in two markets in Florida.

Of the $973.5 million total auction proceeds, approximately $398
million will be paid to the Federal Communications Commission
pursuant to the Global Resolution Agreement that the agency and
NextWave entered into in April 2004. That agreement, which was
approved in May 2004 by the bankruptcy court overseeing the
company's reorganization, resolved all claims and potential claims
between the FCC and NextWave.

"We're extremely pleased with the results," said Allen Salmasi,
NextWave's Chairman and CEO. "Adding nearly $575 million of net
proceeds to the company's balance sheet will greatly strengthen
our financial position and will give us ample funds to pay our
remaining creditors and complete the Chapter 11 reorganization
process. We are now on a path to emerge from bankruptcy with no
debt, an attractive spectrum footprint, and significant cash
reserves."

NextWave withdrew from the auction process its license rights in
Denver, Portland, and Tulsa. Those licenses will remain in the
company's portfolio.

The winning bids of Verizon Wireless and MetroPCS will be
submitted to the bankruptcy court for its approval at a hearing in
White Plains, New York, on July 15, 2004, at 10 AM. Applications
to assign the licenses to Verizon Wireless and to MetroPCS will be
submitted to the FCC, and also will be submitted for review under
the Hart-Scott-Rodino Antitrust Improvements Act.

NextWave Telecom, Inc., headquartered in Hawthorne, N.Y., was
organized in 1995 to provide high-speed wireless Internet access
and voice communications services to consumer and business markets
on a nationwide basis. NextWave is currently constructing a third-
generation CDMA2000 1X network in all of its 95 PCS markets whose
geographic scope covers more than 168 million POPs coast to coast,
including all top 10 U.S. markets, 28 of the top 30 markets, and
40 of the top 50 markets. NextWave's "carriers' carrier" strategy
allows existing carriers and new service providers to market
NextWave's network services through innovative airtime
arrangements. The company filed for chapter 11 protection (Bankr.
S.D.N.Y. Case No. 98-23303) on December 23, 1998. Deborah Lynn
Schrier-Rape, Esq. of Andrews & Kurth, LLP represents the debtor.


NORTHWESTERN: Inks Pact with MPSC and MCC on Reorganization Plan
----------------------------------------------------------------
NorthWestern Corporation (Pink Sheets: NTHWQ) has reached a
Stipulation and Settlement Agreement with the Montana Public
Service Commission and the Montana Consumer Counsel resolving
outstanding issues involving the Company's Plan of Reorganization
which is currently before the U.S. Bankruptcy Court for the
District of Delaware. As part of the agreement, the MPSC and MCC
will not object to confirmation of the Company's Plan of
Reorganization scheduled for Aug. 25, 2004. In addition,
NorthWestern and the MCC agreed to the entry of a Consent Order by
the MPSC to resolve its pending financial investigation.

The agreement was unanimously approved by the MPSC and will be
submitted for approval by the Bankruptcy Court at a hearing
scheduled for July 15, 2004.

"Working with the MPSC and MCC, we have been able to successfully
address their respective concerns involving the Company's
reorganization," said Gary G. Drook, NorthWestern President and
Chief Executive Officer. "Finalizing this agreement is another
important milestone as we continue to make progress toward our
goal of emerging from bankruptcy by the end of 2004."

Mr. Drook added that the Company is currently soliciting support
for its Plan of Reorganization from creditors eligible to vote.
Creditors have until Aug. 2, 2004, to return their ballots to:

          Kurtzman Carson Consultants, LLC
          12910 Culver Boulevard, Suite 1
          Los Angeles, Calif. 90066-6709
          Attn: Christopher R. Schepper
          Telephone: (866) 381-9100

NorthWestern Corporation is one of the largest providers of  
electricity and natural gas in the Upper Midwest and Northwest.  
The company filed for chapter 11 protection (Bankr. Del. Case No.  
03-12872) on September 14, 2003 before the Honorable Peter J.  
Walsh. Scott D. Cousins, Esq., Victoria Watson Counihan, Esq.,  
William E. Chipman, Jr., Esq., of Greenberg Traurig LLP Brandywine  
and Jesse H. Austin, III, Esq., Karol K. Denniston, Esq., Paul,  
Hastings, Esq. of Janofsky & Walker represent the debtor in its  
restructuring efforts.


NRG ENERGY: Asks Court To Approve Amended Thomassen Agreement
-------------------------------------------------------------
In NRG Energy, Inc.'s chapter 11 cases, the Bankruptcy Court
authorized and approved the Debtors' retention of Thomassen Amcot
International, LLC, as brokers for the sale of the Turbine Assets
of Debtors LSP-Nelson Energy, LLC, and NRG Nelson Turbines, LLC.

As the Nelson Debtors now intend to sell substantially all of
their assets, the Nelson Debtors and Thomassen entered into a
letter agreement on June 28, 2004, amending the terms of
Thomassen's original engagement.

The Amended Thomassen Letter Agreement:  

   (a) extends the terms of the original Thomassen Agreement for
       an additional 180 days subsequent to July 2, 2004;

   (b) expands the scope of Thomassen's ability to recover
       brokerage fees to cover the sale of all of the Nelson
       Assets, and the fees will be calculated as 3% of the gross
       selling price of any or all of the Nelson Assets; and

   (c) allows for reimbursement of Thomassen's expenses in
       connection with the Auction in an amount not to exceed
       $100,000.

The Nelson Debtors believe that the Amended Thomassen Agreement
will enable them to maximize sale proceeds for the Nelson Assets
while minimizing expense to their estates.  Accordingly, the
Nelson Debtors ask the Court to approve the Amended Thomassen
Agreement.

NRG Energy, Inc. owns and operates a diverse portfolio of power-
generating facilities, primarily in the United States. Its
operations include baseload, intermediate, peaking, and
cogeneration facilities, thermal energy production and energy
resource recovery facilities.

The company, along with its affiliates, filed for chapter 11
protection (Bankr. S.D.N.Y.  Case No. 03-13024) on May 14, 2003.  
Debtors' counsel are James H.M. Sprayregen, P.C., Matthew A.
Cantor, Esq., and Robbin L. Itkin, Esq. of Kirkland & Ellis.
When the company filed for protection from its creditors, it
listed total assets of $10,310,000,000 and total liabilities of
$9,229,000,000.  (NRG Energy Bankruptcy News, Issue No. 30;
Bankruptcy Creditors' Service, Inc., 215/945-7000)


OMI CORP: Will Not Pursue Stelmar Transaction
---------------------------------------------
OMI Corporation (NYSE:OMM), a leading international provider of
seaborne transportation services for crude and petroleum products,
announced an updated delivery schedule of vessels purchased from
Athenian Sea Carriers, Ltd. and Arcadia Ship Management. Under
these agreements, OMI will take delivery of a total of 14 vessels
between July 2004 and June 2006. Specifically, the Athenian
purchase agreement sets forth the transfer of four Suezmax tankers
and one Handymax product carrier during July 2004. Additionally,
seven Handymax product carriers are scheduled to deliver as
follows: 1 vessel in the third quarter of 2004; two vessels in the
first quarter of 2005, 1 vessel in the first quarter of 2006 and 3
vessels in the second quarter of 2006. Under the Arcadia purchase
agreement, OMI will take delivery of two Suezmax tankers during
August 2004.

Also, OMI will take delivery of one 37,000 dwt Class 1A Ice Class
vessel July 2004. This vessel will be time chartered under a
profit-sharing agreement upon delivery of the vessel for a 5 year
term.

In addition, OMI announced that it is not pursuing an acquisition
of or merger with Stelmar at this time. Craig Stevenson, Chairman
and CEO of OMI said, "Given the significant and positive changes
to OMI following our agreement to acquire 14 vessels from Athenian
Sea Carriers, Ltd. and Arcadia Ship Management, together with our
completed equity offerings, we do not believe pursuing a
transaction with Stelmar at this time is in the best interests of
our shareholders. In the near term, we will focus on integrating
the Athenian and Arcadia acquisitions and the delivery of our
previously ordered newbuildings."

                     About OMI Corporation  
  
OMI is a major international owner and operator of crude oil
tankers and product carriers. Its fleet currently comprises 36
vessels, primarily Suezmaxes and product carriers, aggregating 3.0
million deadweight tons. The Company currently has 23 of its
vessels on time charter. OMI currently has on order five 37,000
and one 47,000 dwt ice class 1A product carriers. Two vessels are
scheduled to be delivered in 2004, three in 2005 and the last in
2006.
  
                         *   *   *  
  
As reported in the Troubled Company Reporter's June 11, 2004  
edition, Standard & Poor's Ratings Services affirmed its 'BB'  
corporate credit rating and its other ratings on OMI Corporation   
and removed all the ratings from CreditWatch, where they were   
placed on May 28, 2004. The removal from CreditWatch followed   
OMI's announcement that it had withdrawn its offer to acquire   
unrated Stelmar Shipping Ltd. The outlook is stable. Stamford,  
Connecticut-based OMI has $613 million in lease-adjusted debt.  
  
"The improved tanker market, even if it weakens somewhat, should  
enable the company to maintain its credit profile," said Standard  
& Poor's credit analyst Kenneth Farer. "However, ratings upside  
potential is limited because of the ongoing fleet renewal program  
and participation in the competitive and cyclical tanker market."


ONE EQUESTRIAN: Case Summary & 3 Largest Unsecured Creditors
------------------------------------------------------------
Debtor: One Equestrian Court, Inc.
        c/o Law offices of Avrum J. Rosen
        38 New Street
        Huntington, New York 11743

Bankruptcy Case No.: 04-84357

Chapter 11 Petition Date: July 7, 2004

Court: Eastern District of New York (Central Islip)

Judge: Stan Bernstein

Debtor's Counsel: Avrum J. Rosen, Esq.
                  Law offices of Avrum J. Rosen
                  38 New Street
                  Huntington, NY 11743
                  Tel: 631-423-8527
                  Fax: 631-423-4536

Total Assets: $1,550,000

Total Debts:  $2,440,000

Debtor's 3 Largest Unsecured Creditors:

Entity                        Nature Of Claim       Claim Amount
------                        ---------------       ------------
The Estate Of Robin Marci     Value of Collateral:      $600,000
Kaufman                       1,550,000
C/O S. Robert And Marilyn
Schneider
385 Ocean Blvd. Apt. 4K
Long Branch, NJ 07740

Champion Mortgage Co., Inc.   Bank loan                 $250,000
                              Value of Collateral:
                              $1,550,000

CMI Capital Corp.             Bank loan                  $40,000


PACIFIC GAS: Resolves Chevron Claim Disputes
--------------------------------------------
In Pacific Gas and Electric Company's chapter 11 cases, on August
21, 2001, Chevron U.S.A., Inc. -- including its divisions, Chevron
Products Co., Chevron Production Co., and CBRES -- filed Claim No.
4523, as amended and supplemented by proofs of claim subsequently
filed as Claim Nos. 7867, 11873, 12672, and 13023, pursuant to
which Chevron sought payment of:

   (a) $33,873 in connection with jet fuel sales made by Chevron
       to PG&E before the Petition Date;

   (b) at least $870,000 for overcharges which Chevron believes
       occurred while receiving electric standby service from
       PG&E at Chevron's refinery in Richmond, California;

   (c) at least $30,000,000 for contribution and indemnity for
       environmental remediation expenses with expenses with
       respect to real property located in Bakersfield,
       California; and

   (d) $327,354 for contribution and indemnity for environmental
       remediation expenses with respect to real property located
       in Brisbane, California.

PG&E has paid $2,289 in interest accrued from and after the
Petition Date through June 30, 2003 with respect to the Jet Fuel
Sales Claim.

On August 28, 2002, the Electric Standby Service Overcharge Claim
was disallowed in its entirety.

With respect to the Brisbane Environmental Indemnity Claim, PG&E,
Chevron and certain other parties have entered into a settlement
agreement and consent decree with the California Department of
Toxic Substances Control.  Pursuant to the Consent Decree, the
parties agreed, inter alia, to resolve the issue by paying the
Department of Toxic Substances Control's costs of removal,
remedial action or response, incurred or to be incurred by the
Department of Toxic Substances Control in response to the release
and threatened release, of mercury at the applicable facility
located in Brisbane, California.

Accordingly, with the Court's consent, PG&E and Chevron resolve
the remaining issues and agree that:

   (a) The Jet Fuel Sales Claim will be allowed as a $33,873
       unsecured, non-priority claim, and will be treated like
       other similar allowed general unsecured claims in PG&E's
       Chapter 11 case.  The $33,873 allowed amount of the Jet
       Fuel Sales Claim is comprised of:

       -- $5,769.69 with respect to jet fuel sold by Chevron to
          PG&E on March 17, 2001;

       -- $9,128.18 with respect to jet fuel sold by Chevron to
          PG&E on March 20, 2001;

       -- $9,129.39 with respect to jet fuel sold by Chevron to
          PG&E on March 20, 2001; and

       -- $9,846.08 with respect to jet fuel sold by Chevron to
          PG&E on March 20, 2001.

   (b) PG&E will pay Chevron interest owing with respect to the
       Jet Fuel Sales Claim accrued from and after June 30, 2002
       through December 31, 2003, which amount will be added to
       the next quarterly interest payment to be made by PG&E to
       Chevron with respect to the Jet Fuel Sales Claim.  PG&E
       will make payment to Chevron for interest accruing on and
       after January 1, 2004 with respect to the Jet Fuel Sales
       Claim quarterly, as with similar allowed general unsecured
       claims in PG&E's Chapter 11 case;

   (c) Chevron will amend the Proof of Claim to reflect the
       withdrawal of the Electric Standby Service Overcharge
       Claim and the Brisbane Environmental Indemnity Claim.  The
       Amended Claim will amend and replace the Proof of Claim.
       Furthermore, the Amended Claim will relate back to the
       date that the Proof of Claim was initially filed,
       August 31, 2001, and will be treated as a timely filed
       proof of claim under the reorganization plan; and

   (d) The Bakersfield Environmental Indemnity Claim will be
       determined, resolved or adjudicated, in the same manner as
       claims classified in Class 8 -- Environmental, Fire
       Suppression, Pending Litigation, and Tort Claims --
       pursuant to the Plan, and will survive the Plan effective
       date as if the Chapter 11 case had not been commenced.
       In resolution or adjudication of the Bakersfield
       Environmental Indemnity Claim, the claim will be deemed to
       be an allowed claim in a yet to be determined amount,
       provided that PG&E preserves all of its rights and
       defenses respecting the Bakersfield Environmental
       Indemnity Claim that exist under applicable non-bankruptcy
       law and certain provision of bankruptcy law, including
       Section 502(d) of the Bankruptcy Code.

Headquartered in San Francisco, California, Pacific Gas and
Electric Company -- http://www.pge.com/-- a wholly-owned  
subsidiary of PG&E Corporation (NYSE:PCG), is one of the largest
combination natural gas and electric utilities in the United
States.  The Company filed for Chapter 11 protection on April 6,
2001 (Bankr. N.D. Calif. Case No. 01-30923).  James L. Lopes,
Esq., William J. Lafferty, Esq., and Jeffrey L. Schaffer, Esq., at
Howard, Rice, Nemerovski, Canady, Falk & Rabkin represent the
Debtors in their restructuring efforts.  On June 30, 2001, the
Company listed $23,216,000,000 in assets and  $22,152,000,000 in
debts. (Pacific Gas Bankruptcy News, Issue No. 79; Bankruptcy
Creditors' Service, Inc., 215/945-7000)   


PARMALAT GROUP: Judge Drain Approves Interim Co-Pack Agreement
--------------------------------------------------------------
In Parmalat Group North America's chapter 11 cases, the Official
Committee of Unsecured Creditors asks the Court to decline
approval of the Interim Co-Pack Agreement unless the term of the
Agreement is extended satisfactorily to be fair to unsecured
creditors.

The Settlement and Interim Co-Pack Agreement between the U.S.
Debtors and Oak Tree Farm Dairy, Inc., provides for, inter alia,
the payment of a $212,591 prepetition claim to Oak Tree.  
Moreover, the Debtors agreed to a full release of any preference
recovery actions against Oak Tree.  The Debtors believe that
$225,000 of the payments made to Oak Tree before the Petition
Date are not subject to readily available defenses.

David M. LeMay, Esq., at Chadbourne & Parke, LLP, in New York,
tells the Court that the Committee does not object to the basic
terms of the Interim Co-Pack Agreement, nor does the Committee
disagree with the U.S. Debtors' assessment of the commercial need
to enter into a transaction of this nature.  However, in the
context of the Prepetition Claim Payment and the Preference
Waiver, the Committee -- comprised of unsecured creditors holding
claims similar to those of Oak Tree -- believes that the term of
Interim Co-Pack Agreement should be extended modestly beyond the
December 31, 2004 termination date.

When the U.S. Debtors and Oak Tree began negotiating the terms of
the Interim Co-Pack Agreement, the Debtors believed that a quick
sale of substantially all of their assets was required to
preserve the value of their estates for their creditors and other
parties-in-interest.  The Debtors recently determined, however,
that a reorganization of their businesses as a going concern will
provide greater benefits to creditors and other parties in
interest.  As a result of the Debtors' new reorganization
strategy, the Debtors' emergence from bankruptcy may occur after
the December 31, 2004 termination date of the Interim Co-Pack
Agreement.

The Interim Co-Pack Agreement, the Committee suggests, should be
extended to at least March 31, 2005 so that the U.S. Debtors do
not have to renegotiate the agreement in a mere six months while
in the process of confirming a plan of reorganization.

                          *     *     *

Judge Drain denies the Committees' Objection and approves terms
and conditions of the Interim Co-Pack Agreement.

Headquartered in Wallington, New Jersey, Parmalat USA Corporation
-- http://www.parmalatusa.com/-- generates more than 7 billion  
euros in annual revenue.  The Parmalat Group's 40-some brand
product line includes milk, yogurt, cheese,  butter, cakes and
cookies, breads, pizza, snack foods and vegetable sauces, soups
and juices and employs over 36,000 workers in 139 plants located  
in 31 countries on six continents.  The Company filed for chapter
11 protection on February 24, 2004 (Bankr. S.D.N.Y. Case No. 04-
11139).  Gary Holtzer, Esq., and Marcia L. Goldstein, Esq., at
Weil Gotshal & Manges LLP represent the Debtors in their
restructuring efforts.  On June 30, 2003, the Debtors listed
EUR2,001,818,912 in assets and EUR1,061,786,417 in debts.
(Parmalat Bankruptcy News, Issue No. 24; Bankruptcy Creditors'
Service, Inc., 215/945-7000)   


PEGASUS SATELLITE: Court Okays Employment of Professionals
----------------------------------------------------------
Pegasus Satellite Communications, Inc., wants to employ the
services of various professionals from time to time in the
ordinary course of operating their business.  Ordinary Course
Professionals provide services to the Debtors in a variety of
discrete matters, including regulatory issues, tax issues,
employee benefit matters and employee-related litigation,
intellectual property matters, commercial litigation, and real
estate matters.

The Debtors want to continue their employment of the Ordinary
Course Professionals postpetition without the necessity of filing
formal applications for employment and compensation by each
professional pursuant to Sections 327, 328, 329 and 330 of the
Bankruptcy Code.  Robert J. Keach, Esq., at Bernstein, Shur,
Sawyer & Nelson, in Portland, Maine, explains that because of the
large number and geographic diversity of the professionals and
the discreet nature of their services performed, it would be
unwieldy and burdensome on both the Debtors and the Court to
require the Ordinary Course Professional to apply separately for
approval of its employment and compensation.  Furthermore, the
amount of fees paid to the Ordinary Course Professional may be de
minimis in any given month but can vary widely from month to
month.

Mr. Keach asserts that the uninterrupted services of the Ordinary
Course Professionals are vital to the Debtors' continuing
operations and their ultimate ability to effectuate a successful
Chapter 11 process.  The cost of preparing and prosecuting the
employment and fee applications would be significant and
unnecessary because it would ultimately be borne by the Debtors'
estates.

To ensure that the Ordinary Course Professional is disinterested
and does not represent or hold any interest adverse to the
Debtors or their estates, the Debtors propose that each Ordinary
Course Professional be required to file a declaration of
disinterestedness with the Court, and to serve copies on:

   * the Debtors,

   * the Debtors' counsel:

     -- Bernstein, Shur, Sawyer & Nelson
        100 Middle Street, P.O. Box 9729, Portland, Maine 04104
        Attn: Robert J. Keach, Esq.;

     -- Sidley Austin Brown & Wood, LLP
        Bank One Plaza, 10 South Dearborn Street,
        Chicago, Illinois 60603
        Attn: Larry J. Nyhan, Esq., and James F. Conlan, Esq.,

   * the Office of the United States Trustee for the District of
     Maine, and

   * the attorneys for any committees that may be appointed.

No firm providing services to any Debtor will receive payment for
postpetition services rendered until the Declaration of Proposed
Professional has been filed with the Court and served on the
Notice Parties.

The Debtors propose that the Notice Parties will have 15 days
after the receipt of each Ordinary Course Professional's
Declaration of Proposed Professional to object to the employment
of the Professional.

Although certain of the Ordinary Course Professionals may hold
small unsecured claims against the Debtors, the Debtors do not
believe that any of the Ordinary Course Professionals have an
interest materially adverse to them, their estates, creditors, or
other parties-in-interest.  Mr. Keach clarifies that the Debtors
are not seeking authority to pay prepetition amounts owed to the
Ordinary Course Professionals.

                        Payment Procedure

The Debtors will pay, without formal Court application, 100% of
the fees and disbursements of each Ordinary Course Professional
without further delay, as long as:

   (a) the fees and disbursements do not exceed $20,000 per
       month for any Ordinary Course Professional, or $200,000
       per annum for any Ordinary Course Professional for the
       duration of the Chapter 11 cases; and

   (b) no written objection to the payment of the invoice is made
       by or received by the Debtors.  If the parties cannot
       resolve the objection, the Ordinary Course Professional
       whose fees are objected to may file a request for payment
       of the disputed amount with the Court.

In the event that in any given month, the fees and disbursements
of any Ordinary Course Professional exceed the Monthly Cap
applicable, that Ordinary Course Professional would be required
to apply for Court approval of all fees and disbursements for the
month, but would be entitled to an interim payment up to the
amount of the Monthly Cap as a credit against the fees and
disbursements for the month ultimately allowed by the Court.  In
the event that the aggregate of the fees and disbursements
exceeds the Aggregate Cap for any given year, the Ordinary Course
Professional would be required, on a going-forward basis, to
apply for Court approval of all its fees and disbursements in
compliance with any interim compensation procedures.

According to Mr. Keach, while some of the Ordinary Course
Professionals may want to continue to represent the Debtors on an
ongoing basis, others may be unwilling to do so if they are
unable to be paid on a regular basis.  If the expertise and
background knowledge of any of the Ordinary Course Professionals
with respect to the particular areas and matters for which they
were responsible before the Petition Date is lost, the Debtors'
estates will undoubtedly incur additional and unnecessary
expenses, as other professionals without those background and
expertise will have to be employed.

                         *      *      *

The Court allows the debtors to employ the Ordinary Course
Professionals on terms substantially similar
to those in effect before the Petition Date.

Headquartered in Bala Cynwyd, Pennsylvania, Pegasus Satellite
Communications, Inc. -- http://www.pgtv.com/-- is a leading  
independent provider of direct broadcast satellite television. The
Company, along with its affiliates, filed for chapter 11
protection (Bankr. D. Me. Lead Case No. 04-20889) on June 2, 2004.
Leonard M. Gulino, Esq., and Robert J. Keach, Esq., at Bernstein,
Shur, Sawyer & Nelson, represent the Debtors in their
restructuring efforts. When the Debtors filed for protection from
their creditors, they listed $1,762,883,000 in assets and
$1,878,195,000 in liabilities. (Pegasus Bankruptcy News, Issue No.
6; Bankruptcy Creditors' Service, Inc., 215/945-7000)    


PER-SE TECHNOLOGIES: Will Report Q2 2004 Earnings on August 4
-------------------------------------------------------------
Per-Se Technologies (Nasdaq: PSTI), the leader in Connective
Healthcare solutions that help physicians and hospitals realize
their financial goals, announces that it will release its second
quarter 2004 earnings before the market opens on Wednesday,
August 4, 2004.

The Company will host a conference call with security analysts and
institutional investors on Wednesday, August 4, 2004, at 10:00
a.m. Eastern Time to discuss its second quarter 2004 results.

A simultaneous, listen-only webcast of the conference call will be
available on the Company's website at http://www.per-se.com/in  
the Investor section by selecting the "Webcasts" link. Listeners
should go to the website at least 15 minutes before the scheduled
start time of the conference call to download and install any
necessary audio software. For those unable to attend the live
broadcast of the call, a replay will be available shortly after
completion of the call and will be archived on Per-Se's website
for approximately 60 days.

               About Per-Se Technologies   
  
Per-Se Technologies (Nasdaq:PSTI) is the leader in Connective   
Healthcare. Connective Healthcare solutions from Per-Se enable   
physicians and hospitals to achieve their income potential by   
creating an environment that streamlines and simplifies the   
complex administrative burden of providing healthcare. Per-Se's   
Connective Healthcare solutions help reduce administrative   
expenses, increase revenue and accelerate the movement of funds
to benefit providers, payers and patients. More information is   
available at http://www.per-se.com/  
  
At March 31, 2004, Per-Se Technologies' balance sheet shows a   
stockholders' deficit of $14,084,000 compared to a deficit of   
$17,612,000 at December 31, 2003.


PIVOTAL SELF: Closes Acquisition of Phantom Fiber Corporation
-------------------------------------------------------------
Pivotal Self-Service Technologies Inc. (OTCBB: PVSS) is pleased to
announce that the Company has completed the acquisition of Phantom
Fiber Corporation.

Effective July 7, 2004, the current directors being John Simmonds
and Brian Usher-Jones resigned and were replaced by Jeffrey
Halloran, Gordon Fowler, Stephen Gesner and Graham Simmonds. John
Simmonds, Gary Hokkanen and Carrie Weiler, the Company's CEO, CFO
and Secretary, respectively have resigned and are replaced by
Jeffrey Halloran as CEO and Vince Bulbrook as CFO and Secretary.
The Company over the next few days will complete a change in name
from Pivotal Self-Service Technologies Inc. to Phantom Fiber
Corporation and will change its trading symbol. Further details on
the trading symbol will be communicated when available. In the
interim the Company will continue to trade under "PVSS".

Jeff Halloran, President and CEO for Phantom Fiber stated, "This
is an exciting day at Phantom Fiber. With the acquisition now
complete, we can continue executing on our aggressive strategy to
extend our solutions to new markets, to forge new partnerships and
further develop the Phantom Fiber brand within our industry. With
an expanded sales and development team, we can effectively meet
our objectives and the expectations of clients and shareholders."

John Simmonds, former Chairman and CEO of Pivotal commented, "This
completes the transition to Phantom Fiber. I look forward to
seeing the result of the seeds we have planted."

As a leading provider of secure wireless technology and mobile
solutions, Phantom Fiber has launched an innovative wireless
software framework that empowers enterprises to efficiently deploy
commercial and productivity applications with high performance
functionality onto java-enabled phones, smartphones and PDA phones
across many communication platforms. Phantom Fiber delivers robust
and secure, client / server applications, which are able to
generate real revenue models and measurable returns. With
solutions built for e-commerce, finance, field service, health and
entertainment, the technology extends at anytime from anywhere to
the hands of a mobile user. For more details on the company,
technology and products, please visit http://www.phantomfiber.com/

                           *   *   *

As reported in the Troubled Company Reporter's July 1, 2004
edition, Pivotal Self-Service Technologies Inc. has an accumulated
deficit of $9,146,487 at March 31, 2004. As a result, substantial
doubt exists about the Company's ability to continue to fund
future operations using its existing resources.  In order to
ensure the success of the new business, the Company is dependent
upon the ability to realize substantial value from its investment
in available for sale securities.

The business of Pivotal Self-Service Technologies Inc. (formerly
known as Wireless Ventures Inc. and Hycomp, Inc.) is conducted
through its wholly-owned Canadian subsidiary Prime Battery
Products Limited. On December 31, 2002, Pivotal, through a newly
incorporated wholly-owned subsidiary named Prime Battery completed
the acquisition of certain business assets of DCS Battery Sales
Ltd.  Prime Battery distributes value priced batteries and other
ancillary products to dollar stores in North America.


RESIDENTIAL ASSET: Fitch Downgrades Class B Ratings to B
--------------------------------------------------------
Fitch Ratings has taken rating actions on the following
Residential Asset Mortgage Products, Inc. issue:

RAMP Home Equity Mortgage Asset-Backed Pass-Through Certificates,
Series 2001-RZ3:

               --Class A-5 affirmed at 'AAA';
               --Class M-1 affirmed at 'AA';
               --Class M-2 affirmed at 'A';
               --Class M-3 affirmed at 'BBB';
               --Class B downgraded to 'B' from 'BB'.

The affirmations of these classes reflect credit enhancement
consistent with future loss expectations. The negative rating
action on the class B bond is due to the decline in enhancement
relative to the applicable credit support levels. As of the June
25, 2004 distribution date, the overcollateralization was
$324,839.05 with a target of $1,075,000.


REVLON INC: Offering $1,122.24 for Each $1,000 12% Senior Note
--------------------------------------------------------------
Revlon, Inc. (NYSE:REV) and its wholly-owned subsidiary, Revlon
Consumer Products Corporation, together announced that, in
connection with the tender offer and consent solicitation by RCPC
with respect to any and all of RCPC's 12% Senior Secured Notes due
2005, RCPC will pay $1,122.24 for each $1,000 principal amount of
12% Notes purchased in the tender offer, plus accrued but unpaid
interest up to, but not including, the settlement date.

The purchase price includes a consent payment of $20.00 per $1,000
principal amount of 12% Notes. Holders of the 12% Notes who have
validly tendered, and not withdrawn, their notes pursuant to the
tender offer prior to 5:00 p.m. EDT on July 8, 2004 will receive
the consent payment. The purchase price was determined by
reference to a fixed spread of 75 basis points over the bid side
yield (as quoted on Bloomberg screen PX4 at 2:00 p.m. EDT on July
8, 2004) of the 1.875% U.S. Treasury Note due November 30, 2005.

The tender offer and consent solicitation will expire at 5:00 p.m.
EDT on July 21, 2004, unless extended. The Company currently
expects to have an initial settlement on July 9, 2004 for the 12%
Notes tendered prior to such date, followed by a final settlement
promptly after the July 21, 2004 expiration date for any 12% Notes
tendered on or after the initial settlement date, subject to
satisfying various conditions, including entry into and funding
under the Company's new credit facility.

In connection with the initial settlement expected to occur on
July 9, 2004 and as part of the Company's previously-announced
refinancing of the Company's debt that would otherwise mature in
2005, the Company also expects to enter into on July 9, 2004 a new
$960 million credit facility with Citicorp USA, Inc. and Citigroup
Global Markets Inc. and a syndicate of lenders.

Holders of the notes can obtain copies of the Offer to Purchase
and related materials from D.F. King & Co., Inc., the Information
Agent, at (800) 949-2583 (toll free) or (212) 269-5550 (collect).
Citigroup Global Markets Inc. is acting as Dealer Manager.
Questions regarding the solicitation can be addressed to Citigroup
at (800) 558-3745 (toll free) or (212) 723-6106 (collect).

None of Revlon, RCPC, Citigroup or the Information Agent makes any
recommendations as to whether or not holders should tender their
notes pursuant to the tender offer, and no one has been authorized
by any of them to make such recommendations. Holders must make
their own decisions as to whether to tender their 12% Notes, and,
if so, the principal amount of 12% Notes to tender.

                       About Revlon

Revlon is a worldwide cosmetics, fragrance, and personal care
products company. The Company's vision is to deliver the promise
of beauty through creating and developing the most consumer
preferred brands. Websites featuring current product and
promotional information can be reached at http://www.revlon.com
and http://www.almay.com/Corporate investor relations information  
can be accessed at http://www.revloninc.com/

At March 31, 2004, Revlon Inc.'s consolidated balance sheet shows
a stockholders' deficit of $956.4 million compared to a deficit of
$1.72 billion at December 31, 2003.


SINCLAIR BROADCAST: S&P Assigns BB Ratings To Term Loans
--------------------------------------------------------
Standard & Poor's Ratings Services assigned its 'BB' rating to
Sinclair Television Group Inc.'s $150 million term loan A and $250
million term loan C. A recovery rating of '1' was also assigned to
the term loans, indicating high expectations of a full recovery of
principal in the event of default. Borrowings under the term loans
are being used to refinance the existing term loan B.

At the same time, Standard & Poor's affirmed its 'BB-' long-term
corporate credit rating on parent company Sinclair Broadcast Group
Inc.

The outlook is negative.

Hunt Valley, Maryland-based Sinclair had total debt outstanding of
approximately $1.7 billion at March 31, 2004. "The effect of the
transaction is to lower the company's interest expense," said
Standard & Poor's credit analyst Alyse Michaelson. The rating on
Sinclair continues to reflect high financial risk from aggressive,
debt-financed TV station acquisitions and the mature long-term
growth prospects for the TV station business. These factors are
partially offset by the company's large television audience reach,
the strong margin and discretionary cash flow potential inherent
in the television broadcasting business, and station asset values.
About one-third of Sinclair's total revenue is derived from
generally lower-ranked stations affiliated with the still-
developing WB and UPN TV networks.

Television advertising is picking up in 2004 because of general
economic improvement and significant political advertising. TV
operators do not have the benefit of sizeable political ad dollars
in nonelection years, which create difficult, albeit predictable,
revenue comparisons in odd numbered years. Discretionary cash flow
growth in 2004 is expected to benefit from the uptick in
television advertising, meaningful political ad dollars, and
considerably lower capital spending.

The negative outlook recognizes that leverage is relatively high
for the 'BB-' rating level. There is modest debt capacity at the
current rating to withstand operating shortfalls, share
repurchases, or acquisitions. Reducing leverage by using cash flow
to lower debt, in both political and non-political years, will be
important in any consideration of an outlook revision to stable.  
Stabilizing ad demand should represent a source of support in the
intermediate term.


SPIEGEL GROUP: Judge Allows Purchase Agreement with Newport News
----------------------------------------------------------------
Judge Blackshear authorizes Spiegel, Inc., Newport News, Inc.,
Newport News Services, LLC, and New Hampton Realty Corp. to enter
into an amended purchase agreement with Newport News
International Limited.

On June 24, 2004, Newport News Holdings Corporation announced that
Senior Management, in partnership with Golden Gate Capital, has
acquired Newport News, a catalog and direct marketing company,
from Spiegel, Inc.  Post closing, the business will continue to
operate under the Newport News Brand name.  Terms of the deal were
not disclosed. For additional information about the company, see
http://www.newportnews.com/

"We are extremely pleased to see that Newport News will move
forward under new ownership," said Geralynn Madonna President &
CEO of Newport News Holdings Corporation.  "This presents an
exciting new opportunity for the company to reach its full
potential and is a testament to the strength of the brand and the
effort put forth by its employees.  The Newport News team will
remain focused on serving its customers and delivering on its
brand promise of 'real style and real value.'"

Newport News will continue to be headquartered in New York and
operate a distribution facility in Virginia.

                    About Golden Gate Capital

Golden Gate Capital http://www.goldengatecap.com/is a San  
Francisco- based private equity investment firm with approximately
$2.5 billion of capital under management.  Golden Gate Capital is
dedicated to partnering with world-class management teams to
invest in change-intensive, growth businesses.  They target
investments in situations where there is a demonstrable
opportunity to significantly enhance a company's value.  The
principals of Golden Gate have a long and successful history of
investing with management partners across a wide range of
industries and transaction types.  Consumer products and
direct marketing businesses are a core focus of Golden Gate
Capital.  Other portfolio companies in the sector include
Herbalife, Leiner Health Products and Lexicon Marketing.

             About Newport News Holdings Corporation

Newport News Holdings Corporation reaches customers through
the Newport News brand, as a dual-channel, direct marketer of
moderately priced women's fashions, providing customers with an
informative and rewarding shopping experience through catalogs
and an e-commerce site http://www.newport-news.com/ Delivering on  
its brand promise of "real style, real value," Newport News
fulfills the modern woman's desire for versatile, on-trend
designs at easily affordable prices

Headquartered in Downers Grove, Illinois, Spiegel, Inc. --
http://www.spiegel.com/-- is a leading international general  
merchandise and specialty retailer that offers apparel, home
furnishings and other merchandise through catalogs, e-commerce
sites and approximately 560 retail stores.  The Company filed for
Chapter 11 protection on March 17, 2003 (Bankr. S.D.N.Y. Case No.
03-11540).  James L. Garrity, Jr., Esq., and Marc B. Hankin, Esq.,
at Shearman & Sterling represent the Debtors in their
restructuring efforts.  When the Company filed for protection from
its creditors, it listed $1,737,474,862 in assets and
1,706,761,176 in debts. (Spiegel Bankruptcy News, Issue No. 28;
Bankruptcy Creditors' Service, Inc., 215/945-7000)   


SPIEGEL GROUP: Reports $124.1 Million Net Sales in June 2004
------------------------------------------------------------
The Spiegel Group reported net sales of $124.1 million for the
five weeks ended July 3, 2004, a 23 percent decrease compared to
net sales of $160.2 million for the five weeks ended June 28,
2003. Sales comparisons for June were impacted by the company's
sale of its Newport News business. Net sales reported for June
2004 include the Newport News business through June 21, 2004,
whereas last year's sales include results for the full five-week
period. Excluding the Newport News business, the Group's net sales
decreased 18 percent for the month of June 2004 compared to June
2003.

For the 26 weeks ended July 3, 2004, total net sales declined 21
percent to $660.1 million from $840.2 million in the same period
last year.

The company also reported that comparable-store sales for its
Eddie Bauer division decreased 11 percent for the five-week period
and 6 percent for the 26-week period ended July 3, 2004, compared
to the same periods last year.

Net sales from retail and outlet stores fell 14 percent for the
month compared to the same period last year, reflecting a decline
in comparable- store sales and fewer stores compared to last year.

The Group's direct net sales decreased 31 percent for the month
compared to the same period last year primarily due to the sale of
the Newport News business, lower customer response and a planned
reduction in catalog circulation. Excluding the Newport News
business, direct net sales decreased 23 percent for June compared
to the same period last year.

Headquartered in Downers Grove, Illinois, Spiegel, Inc. --
http://www.spiegel.com/-- is a leading international general  
merchandise and specialty retailer that offers apparel, home
furnishings and other merchandise through catalogs, e-commerce
sites and approximately 560 retail stores.  The Company filed for
Chapter 11 protection on March 17, 2003 (Bankr. S.D.N.Y. Case No.
03-11540).  James L. Garrity, Jr., Esq., and Marc B. Hankin, Esq.,
at Shearman & Sterling represent the Debtors in their
restructuring efforts.  When the Company filed for protection from
its creditors, it listed $1,737,474,862 in assets and
1,706,761,176 in debts.


SR TELECOM: Subsidiary Launches Expanded Commercial Operations
--------------------------------------------------------------
SR Telecom(TM) Inc. (TSX: SRX; Nasdaq:SRXA) announced that its
Chilean network operator subsidiary, CTR, has been granted a
license by the Minister of Public Works and Telecommunications
of Chile that allows CTR to provide urban wireless
telecommunication services in the cities of Temuco, Talca, Los
Angeles and Chillan. CTR expects to obtain a similar license for
the cities of Osorno and Puerto Montt in the coming weeks.

SR Telecom will deploy its broadband angel(TM) product for this
network application. The angel deployment will permit CTR to offer
carrier-class telephony and high-speed Internet access to urban
customers at very competitive prices.

"The pilot project using our angel solution in Temuco was a
definitive success, and we are very pleased to begin deploying
angel in this region, which is contiguous with CTR's current
service area," said David Adams, SR Telecom's Senior Vice-
President, Finance and Chief Financial Officer. "This deployment
is a part of our previously announced initiative to deploy up to
6,000 new lines into several urban areas of Chile. In 2004, we
anticipate deploying approximately 4,000 of these lines. The cost
to us is minimal as we will be using surplus angel inventory.
Combined with the recently approved increase in access charges,
this initiative should enable CTR to achieve EBITDA of
approximately $7 million on an annualized basis by the end of the
current fiscal year."

                           About angel

angel is a premier next generation Broadband Fixed Wireless Access
product that combines the most advanced multiplexing,
Transmission, and modulation technologies to deliver DSL-
equivalent data rates and carrier-class voice services within
significantly less radio frequency spectrum than other solutions.
Additionally, angel's extensive network management capabilities
optimize deployability and operability. Developed in close
collaboration with a large service provider, angel boosts
subscriber coverage to levels that can exceed 95% of a service
provider's target market area, and remains cost effective in even
the smallest applications.

                            About CTR

Comunicacion y Telefonia Rural is a provider of local telephone
and Internet access services to residential, commercial and
institutional customers in a large, predominantly rural area of
Chile. CTR is a majority-owned subsidiary of SR Telecom.

                         About SR Telecom

SR TELECOM (TSX: SRX, Nasdaq: SRXA) is one of the world's leading
providers of Broadband Fixed Wireless Access technology,  which
links end-users to networks using wireless transmissions. For over
two decades, the Company's products and solutions have been used
by carriers and service providers to deliver advanced, robust and
efficient telecommunications services to both urban and remote
areas around the globe. SR Telecom's products have been deployed
in over 120 countries, connecting nearly two million people.

The Company's unrivalled portfolio of BFWA products enables its
growing customer base to offer carrier-class voice, broadband data
and high-speed Internet services. Its turnkey solutions include
equipment, network planning, project management, installation and
maintenance.

SR Telecom is an active member of WiMAX Forum, a cooperative
industry initiative which promotes the deployment of broadband
wireless access networks by using a global standard and certifying
interoperability of products and technologies.

                            *   *   *

As reported in the Troubled Company Reporter's May 05, 2004
edition, Standard & Poor's Ratings Services lowered its long-term
corporate credit and senior unsecured debt ratings on SR Telecom
Inc. to 'CCC' from 'CCC+'. The outlook is negative.

"The ratings action reflects continued poor operating performance
and material negative free operating cash flow in 2003, and
follows the company's announcement that it plans to undertake
additional restructuring of its operations," said Standard &
Poor's credit analyst Michelle Aubin.

The negative outlook reflects the possibility that the ratings on
SR Telecom could be lowered further if the company's operating
performance and liquidity position do not improve.


TALCOTT NOTCH: Fitch Affirms Low-B Ratings of Classes A-4 & B-1
---------------------------------------------------------------
Fitch Ratings affirms six tranches issued by Talcott Notch CBO I,
Ltd. The following rating actions are effective immediately:

     --$5,134,677 class A-1L floating-rate notes due 2009 'AAA';
     --$63,000,000 class A-2L floating-rate notes due 2011 'AAA';
     --$10,631,903 class A-3B variable coupon notes due 2011 'AA';
     --$79,500,000 class A-3L floating-rate notes due 2011 'AA';
     --$20,000,000 class A-4 8.417% notes due 2011 'BB+';
     --$10,000,000 class B-1 9.667% notes due 2011 'B-';
     --$12,000,000 class B-2L floating-rate notes due 2011 remains
       at 'CCC-'.

Talcott Notch is a collateralized debt obligation which closed
Oct. 20, 1999 and is managed by General Re-New England Asset
Management. Talcott Notch is composed primarily of high yield
bonds and loans. Included in this review, Fitch discussed the
current state of the portfolio with the asset manager and their
portfolio management strategy going forward. In addition, Fitch
conducted cash flow modeling utilizing various default timing and
interest rate scenarios.

Since the last rating action the senior class A
overcollateralization ratio increased from 122.8% as of April 17,
2003 to 131% as of the most recent trustee report dated June 17,
2004, and the class A OC ratio increased from 112.5% to 115.4%.
The class B OC ratio of 100.9% failed versus the trigger of 103%
and the interest coverage ratio of 111.4% failed versus the
trigger of 130%. Defaulted assets represented 10.17% of the $201.5
million of total collateral and eligible investments. Assets rated
'CCC+' or lower represented approximately 32.4%, excluding
defaults.

Prior to the distribution date in April 2004, the collateral
manager repurchased $13.5 million of class A-3L notes and $5
million of class A-3B notes in the secondary market at a discount
to par. Fitch analyzed this action by the manager and determined
that the repurchase increased all of the OC ratios and did not
have a negative impact on any class of notes. The action did
reduce the coverage test redemption amount paid to the class A-1L
and the class A-2L. However, the class A-1L did receive a large
cash redemption due to the failure of the interest coverage test
during the period.

Fitch conducted cash flow modeling utilizing various default
timing and interest rate scenarios to measure the breakeven
default rates going forward relative to the minimum cumulative
default rates required for the rated liabilities. As a result of
this analysis, Fitch has determined that the current ratings
assigned to all classes of notes still reflect the current risk to
noteholders.

The ratings of the class A-1L, class A-2L and class A-3L notes
address the likelihood that investors will receive full and timely
payments of interest, as per the governing documents, as well as
the aggregate principal amount by the final maturity date. The
ratings of the class A-4, B-1 notes and B-2L notes address the
likelihood that investors will receive the cumulative interest
amount, as per the governing documents, as well as the aggregate
principal amount final maturity date. The rating of the class A-3B
addresses the likelihood that investors will receive the current
accretion amount by the final maturity date.


TESORO PETROLEUM: Fitch Upgrades 4 Low-B Debt Ratings
-----------------------------------------------------
Fitch Ratings has upgraded the debt ratings of Tesoro Petroleum
Corporation following Tesoro's redemption of its $297.5 million of
outstanding 9% senior subordinated notes on July 1. The ratings
had been placed on Watch Positive in early June following the
company's announcement it planned to redeem the notes. Fitch has
upgraded the ratings on Tesoro's debt as follows:

    --Senior secured revolving credit facility to 'BB' from 'BB-';
    --Senior secured notes to 'BB' from 'BB-';
    --Senior secured term loan to 'BB' from 'BB-';
    --Senior subordinated notes to 'B+' from 'B'.

The ratings have been removed from Positive Rating Watch and the
Rating Outlook is Stable.

As expected, Tesoro redeemed the notes through cash on hand as the
company benefited from another quarter of very strong refining
margins. With the redemption of the notes, Tesoro has reduced
balance sheet debt to approximately $1.3 billion from $2.1 billion
at the time of the Golden Eagle acquisition in May 2002. Following
the redemption, Tesoro had $136 million of cash invested and no
borrowings under its recently amended $650 million credit
facility.

Tesoro owns and operates six crude oil refineries with a rated
crude oil capacity of 560,000 barrels per day. Four of Tesoro's
refineries are on the West Coast, with facilities in California,
Alaska, Hawaii, and Washington. Tesoro also has refineries in Salt
Lake City, Utah and Mandan, North Dakota. Tesoro sells refined
products wholesale or through approximately 550 branded retail
outlets.


TITAN CORP: Releases Preliminary Results for Second Quarter 2004
----------------------------------------------------------------
The Titan Corporation (NYSE: TTN) announced preliminary financial
results for the second quarter ended June 30, 2004, noting that
the company's quarterly close procedures have not been completed
for that period. The preliminary results are being provided to
give an update on Titan's operations. The preliminary results are
also being provided to announce material costs and charges
expected to be recorded by Titan in the second quarter. Final
results for the quarter ended June 30, 2004 are expected to be
released in the first week of August 2004.

Titan expects record revenues for the second quarter of 2004 in
the range of $510 million to $515 million, reflecting a growth
rate of 16-18% over the second quarter of 2003. Sequential growth
over the first quarter of 2004 is expected to be 10-11%. Revenues
from Titan's National Security Solutions businesses increased
significantly in the services and systems integration areas.

Projections for the company's net loss for the quarter and net
loss per share include certain expected charges that have not yet
been finally determined. The estimated range of the net loss is
expected to be $62-$78 million, or $0.74-$0.93 per share,
comprised of the following anticipated results and charges:

Net loss from continuing operations of $27-$38 million, which
includes:

     -- Operating profit of $33-$35 million, before merger-related
        costs, government investigation costs and reserves, asset
        impairments, and interest expense;

     -- Merger-related and government investigation costs incurred
        of approximately $8-$9 million;

     -- Accruals of reserves relating to the estimated additional
        costs to reach resolution with the government on the
        Foreign Corrupt Practices Act investigations of $26-$32
        million, which are not expected to be tax deductible; and

     -- Asset impairment charges within continuing operations of
        $20-$25 million;
        
     -- Interest expense of approximately $9 million;
       
     -- An estimated tax provision on the operating profit above
        at an effective rate of 40%; and an estimated tax benefit
        on the merger-related and government investigation costs,
        asset impairment charges, and interest expense items above
        at an effective 40% tax rate.

     -- Loss on Discontinued Operations of approximately
        $35-$40 million.

"Our Board of Directors and management have completed plans for
exiting non-core and under-performing businesses that have
negatively impacted earnings and cash flow in the past. This
strategy will allow us to focus on our National Security Solutions
businesses, where we are clearly one of the leading providers,"
said Gene W. Ray, chairman, chief executive officer, and
president.

"During the second quarter, Titan continued to generate strong
revenue growth in our business of serving our nation's military,
intelligence, and homeland security needs. We believe that Titan
is well positioned to continue its strong revenue growth. In
particular:

     -- Our backlog is more than $5 billion, and we are actively
        hiring to generate revenue on these contracts.  We are
        presently advertising over 900 job openings on Titan's Web
        site to help service this backlog;

     -- Titan's new business opportunities continue to grow, with
        a healthy pipeline of new contract opportunities;

     -- We have retained all of Titan's operating general
        managers, all of whom are committed to delivering
        continued revenue growth and operating efficiencies,"
        stated Ray.

                   Operating Performance

Operating profit margins continued to improve across most business
areas, due primarily to economies of scale and favorable contract
mix. However, these margins will be more than offset in the second
quarter by the charges and costs listed above.

As previously disclosed, Titan had reserved $3 million as of
December 31, 2003 for resolution of the government FCPA
investigations. Titan now estimates the incremental cost to
resolve this matter with the government will be $26 - $32 million.
The company is continuing to cooperate fully with the government
to resolve the investigations. The actual provision to be recorded
in the second quarter will be determined at the time final
earnings are released in early August.

The operating loss for the second quarter of 2004 is also expected
to reflect approximately $20 - $25 million in asset impairment
charges. Approximately half of these charges pertain to impairment
of fixed assets directly related to the termination of a program
by a civilian government agency in the second quarter, and a
reduction in scope of planned business activities in Saudi Arabia.
The remainder of these estimated charges are related to a
reduction in the estimated realizable value of SureBeam-related
assets that were transferred to Titan in an April 2004 bankruptcy
court settlement as collateral for the $25 million owed by
SureBeam to Titan, and a charge for impairment of a technology
license Titan purchased from SureBeam in 2001. Our current
estimates indicate insufficient future business and cash flows to
recover the carrying value of these assets.

                    Discontinued Operations

Titan also announced that it has put up for sale its non-core
Datron World Communications business and its Titan Scan
Technologies service business. Titan expects to record after-tax
charges in discontinued operations of approximately $24-$28
million in the second quarter of 2004 related to the disposal of
these two businesses. The charges are comprised of approximately
$18 million of non-deductible impaired intangible assets, mostly
goodwill, and fixed asset values not expected to be recovered in
the disposal of these businesses.

Titan also expects to record a charge of approximately $11
million, after-tax, pertaining to our discontinued Titan Wireless
activities in Benin, Africa. This charge, principally the result
of the Benin customer's cash flow deficiencies and inability to
obtain adequate financing, represents a full allowance for the
remaining amount of the past-due $14.5 million receivable on the
underlying Benin contract, plus an additional $4 million accrual
related to a contingent liability associated with a subcontractor
on this project.

                        Liquidity

Days sales outstanding (DSO's) were down sequentially in the
quarter to approximately 77 days from 84 days at March 31, 2004,
and up from 72 days at December 31, 2003. Availability under
Titan's senior credit facility at June 30, 2004 was $75 million.
Bank debt, net of cash on hand, increased by approximately $20
million during the second quarter. The primary drivers of cash
outflows during the second quarter of 2004 included increased
receivables due to revenue growth, a $7 million payment to exit a
leased facility that was accrued for in 2002, and cash costs
related to the merger and the government investigation. Titan was
in compliance with all covenants of its credit facility at June
30, 2004, after reflecting the projected range of all estimated
charges and losses described above.

"The merger-related distractions and uncertainties of the last
nine months are behind us," said Ray. "We will continue to work
diligently to resolve the outstanding issues that face Titan.
However, we believe that the heart of the Titan story is a well-
positioned national security solutions provider with good growth
prospects, a reenergized senior management team, 12,000
experienced, hard-working and dedicated employees, and a corporate
culture whose overarching goal is creating shareholder value."

         Annual Meeting of Stockholders Date

Titan also announced that the Board of Directors has established
August 19, 2004 as the date of the Annual Meeting of Stockholders
of the corporation.

                    About Titan

Headquartered in San Diego, The Titan Corporation is a leading  
provider of comprehensive information and communications systems  
solutions and services to the Department of Defense, intelligence  
agencies, and other federal government customers. As a provider of  
national security solutions, the company has approximately 12,000  
employees and annualized sales of approximately $2 billion.  

                     *   *   *

As reported in the Troubled Company Reporter's June 30, 2004  
edition, Standard & Poor's Ratings Services said that it revised  
its CreditWatch listing on Titan Corp. to negative from  
developing, following Lockheed Martin Corp.'s (BBB/Stable/A-2)  
decision to terminate its $2.2 billion deal to acquire Titan   
(BB-/Watch Neg/--).  
  
The ratings on Titan were originally placed on CreditWatch with   
positive implications on Sept. 16, 2003, following the announced   
acquisition of Titan by Lockheed Martin. On March 9, 2004, the   
CreditWatch listing was revised to developing, following the   
announcement of a Justice Department probe into whether overseas   
consultants for Titan Corp. made illegal payments to foreign   
officials, which jeopardized the completion of its acquisition by   
Lockheed Martin. Lockheed Martin imposed a June 25, 2004   
deadline for Titan to enter into an agreement with the Justice   
Department, which Titan was unable meet, leading to the   
termination of the merger.


TOWER AUTOMOTIVE: Opens New Joint-Venture Facility in China
-----------------------------------------------------------
Tower Automotive, Inc. (NYSE:TWR) recently announced the official
opening of a new facility for its joint venture operation in Wuhu,
China.

Tower Automotive owns 80 percent of the joint venture, which is
called Tower Automotive Company Ltd. The remaining 20 percent is
owned by Chery Automotive Company, a Chinese vehicle manufacturer.
The joint venture supplies structural suspension components and
other stamped assemblies, most of which are e-coated by the
company, to Chery. The joint venture was established in March 2003
and has been operating in leased facilities while the new building
was under construction.

The new facility covers 28,000 square meters and has 200
employees. The official opening was attended by executives from
Tower Automotive, Chery Automotive and First Auto Works (FAW), as
well as government officials from Anhui Province.

"With cooperation from our Chinese partner and the local
authorities, our team at Tower Automotive Wuhu was able to build
this facility in record time, and already has established
excellent customer relationships," said Vincent Pairet, Regional
Leader for Tower Automotive in Asia.

"This represents a significant step forward for the growth of our
business in Asia," added Tower Automotive President and CEO
Kathleen Ligocki. "With operations in Korea, Japan and India as
well, we are building a significant footprint in a region where
the automotive industry is growing rapidly."

Tower Automotive Inc. is a global designer and producer of vehicle
structural components and assemblies used by every major vehicle
manufacturer, including BMW, DaimlerChrysler, Fiat, Ford, General
Motors, Honda, Hyundai/Kia, Nissan, Toyota and Volkswagen Group.
Products include body structures and assemblies, lower vehicle
frames and structures, chassis modules and systems, and suspension
components. The company is based in Novi, Michigan. Additional
company information is available at
http://www.towerautomotive.com/

                     *   *   *

As reported in the Troubled Company Reporter's May 20, 2004,
Standard & Poor's Ratings Services assigned its 'B-' rating to  
Novi, Michigan-based Tower Automotive Inc.'s $110 million 5.75%  
convertible senior debentures maturing in May 2024, to be issued  
in accordance with SEC Rule 144A with registration rights.

Proceeds from the offering, together with a portion of a new  
senior secured bank credit facility, will repay outstanding  
indebtedness under Tower's existing bank credit facility and  
redeem Tower's $200 million 5% convertible subordinated notes due  
Aug. 1, 2004.

"The transactions will improve Tower's financial flexibility by  
extending debt maturities and increasing available liquidity,"  
said Standard & Poor's credit analyst Daniel DiSenso. "Ratings  
could be lowered, though, should there be a delay in the timing of  
benefits to be derived from actions to turn the business around,  
resulting in the deterioration of credit statistics."


TSI TELSYS: Wins New Order for Turnkey RF System
------------------------------------------------
TSX Venture Exchange "TSI" - TSI TelSys Corporation announced that
its operating subsidiary, TSI TelSys Inc., has received an order
worth U.S.$0.3 million from a U.S. defense and aerospace
contractor to deliver an integrated RF system.

Jim Chesney, TSI TelSys' President/CEO said "We are very pleased
to have received this order for an integrated RF system, as it not
only involves delivery of TSI TelSys product, but it will once
again utilize our system integration capabilities. The system,
which will be built around TSI TelSys' Programmable Wideband
Modem, may be one of the first systems ever delivered with high-
rate, 16 parallel Viterbi decoding. We expect to deliver this
turnkey system by year-end."

Headquartered in Columbia, Maryland, TSI TelSys designs,
manufactures and markets high-performance range data receivers,
data acquisition, simulation and communication systems for the
test range and aerospace communities and provides related
engineering services. The Company has been a pioneer in utilizing
reconfigurable architectures for communications and data
processing, and has incorporated this technology into its product
line since 1996. The Company is a leader in providing multi-
mission satellite communications systems adaptable to virtually
any protocol format and that support data rates up to a gigabit
per second.

At December 26, 2003, TSI TelSys' balance sheet shows a deficit of
C$1,145,834 as compared to a deficit of C$264,753 at December 27,
2002.


UNITED AIRLINES: Court Okays Marr Hipp as Special Labor Counsel
---------------------------------------------------------------
The Court allows UAL Corporation/United Airlines Inc. to employ
Marr, Hipp, Jones & Wang as special labor counsel.

James H.M. Sprayregen, Esq., at Kirkland & Ellis, explains that
Cynthia M. Surrisi, Esq., formerly of Piper Rudnick, recently
moved to Marr Hipp.  The Debtors intend to employ Marr Hipp to
allow Ms. Surrisi to continue represent them in labor matters.

Ms. Surrisi represented the Debtors in labor matters since 1998.  
Prior to 1998, Ms. Surrisi developed extensive experience
negotiating labor contracts in the airline industry, specializing
with pilots.  In 1998, the Debtors determined that Ms. Surrisi
was uniquely experienced and qualified to provide representation
in their labor relationships.  The Debtors then employed Piper
Rudnick to utilize the services of Ms. Surrisi.

The Debtors also employed Piper Rudnick to utilize the services
of another expert in airline labor law, Marilyn Pearson.  Ms.
Pearson represented the Debtors in their relationship with the
Association of Flight Attendants, focusing on flight attendant
labor issues.  The Debtors will continue to employ Piper Rudnick
to allow Ms. Pearson to continue in her role.

Mr. Sprayregen assures the Court that there will be minimal
duplication of services.  Ms. Surrisi operated within an entirely
separate and independent sphere from Ms. Pearson.  It is likely
that the Debtors' overall professional fees will decrease due to
a lower fee structure at Marr Hipp.  Marr Hipp will be
compensated on an hourly basis, plus reimbursement of actual and
necessary expenses incurred.

Headquartered in Chicago, Illinois, UAL Corporation --
http://www.united.com/-- through United Air Lines, Inc., is the  
holding company for United Airlines -- the world's second largest
air carrier.  the Company filed for chapter 11 protection on
December 9, 2002 (Bankr. N.D. Ill. Case No. 02-48191). James H.M.
Sprayregen, Esq., Marc Kieselstein, Esq., David R. Seligman, Esq.,
and Steven R. Kotarba, Esq., at KIRKLAND & ELLIS represent the
Debtors in their restructuring efforts.  When the Company filed
for protection from their creditors, they listed $24,190,000,000
in assets and  $22,787,000,000 in debts. (United Airlines
Bankruptcy News, Issue No. 52; Bankruptcy Creditors' Service,
Inc., 215/945-7000)   


WACHOVIA BANK: Fitch Affirms Low-B Ratings of 6 2004-C12 Classes
----------------------------------------------------------------
Wachovia Bank Commercial Mortgage Trust's commercial mortgage
pass-through certificates, series 2004-C12, are rated by Fitch
Ratings as follows:

                    --$50,000,000 class A-1 'AAA';
                    --$199,000,000 class A-2 'AAA';
                    --$82,000,000 class A-3 'AAA';
                    --$474,876,000 class A-4 'AAA';
                    --$25,248,000 class B 'AA';
                    --$9,302,000 class C 'AA-';
                    --$22,590,000 class D 'A';
                    --$10,630,000 class E 'A-';
                    --$115,031,000 class A-1A 'AAA';
                    --$11,959,000 class F 'BBB+';
                    --$11,959,000 class G 'BBB';
                    --$13,288,000 class H 'BBB-';
                    --$3,986,000 class J 'BB+';
                    --$2,657,000 class K 'BB';
                    --$5,315,000 class L 'BB-';
                    --$3,986,000 class M 'B+';
                    --$2,657,000 class N 'B';
                    --$2,657,000 class O 'B-';
                    --$15,955,508 class P 'NR';
                    --$1,063,096,508 class IO* 'AAA';
                    --$13,555,555 class MAD 'BBB-'.
                    * Notional Amount and Interest Only.

Class P is not rated by Fitch Ratings. Classes A-1, A-2, A-3, A-4,
B, C, D, and E are offered publicly, while classes A-1A, F, G, H,
J, K, L, M, N, O, P, IO, and MAD are privately placed pursuant to
rule 144A of the Securities Act of 1933. With the exception of the
MAD certificates, which represent an interest in a subordinate
note secured by the 11 Madison Avenue property, the certificates
represent beneficial ownership interest in the trust, primary
assets of which are 96 fixed-rate loans having an aggregate
principal balance of approximately $1,063,096,508, as of the
cutoff date.


WORLDCOM INC: Judge Gonzalez Rules KPMG Won't Be Disqualified
-------------------------------------------------------------
Judge Gonzalez finds that KPMG does not hold an interest adverse
to Worldcom Inc.'s estate and is disinterested under Section 327
of the Bankruptcy Code.

The Court notes that there is no indication that KPMG is a
creditor, an equity security holder or an insider.  Moreover,
KPMG was and is not a director, officer, or employee of the
Debtors, nor do the States make any allegation that KPMG is or
has been.  Accordingly, Sections 101(14)(A) and (D) of the
Bankruptcy Code are not applicable.

KPMG does not have an interest adverse to the interests of the
estate or of any class of creditors or equity holders, by reason
of any direct or indirect relationship to, connection with, or
interest in, the Debtors simply because there is a speculative
possibility that in the future, some events may render KPMG and
the adverse.  There also is no indication that KPMG's tax
services qualify as a prohibited activity.  Thus, the States'
contention that KPMG is not disinterested because it serves as
both auditor and tax advisor to the Debtors does not appear to be
well-founded.

According to Judge Gonzalez, the issues raised in the WorldCom
Examiner's Final Report did not rise to a level of concern for
the Securities and Exchange Commission to warrant calling the
matter to the attention of the District Court or the Bankruptcy
Court.  The SEC also stated that if they had concluded there was
a violation of the Auditor Independence Rules, they would have
"promptly raised the matter with the [C]ommissioners to see
whether they thought further action would be appropriate."

The SEC also addressed the issue of confidentiality and stated
that it is generally up to the client's counsel to decide whether
to disclose non-public preliminary document requests and that
generally, the SEC does not advise the client to do so.  The SEC
said that the reasons for keeping the SEC Requests confidential
were to encourage compliance and not to unnecessarily upset the
public marketplace.

Nonetheless, the Court reviewed the SEC Production and found no
indication that the Debtors' determination is an improper
exercise of their reasonable business judgment.  Judge Gonzalez
also observes that there were no material facts in dispute
regarding the grounds argued by the States that supported the
contentions and legal arguments in the Disqualification Motion.  
In addition, the discovery requests made by the States are
extremely broad and primarily focused on the litigation over the
validity of the Royalty Charges rather than on the
Disqualification Motion.  If the discovery was appropriate at
all, it would be in the context of any litigation regarding the
Royalty Charges and not in a request to disqualify.

The SEC Production, although reviewed by the Court, was not
necessary to the disposition of the issues raised by the States
in the Disqualification Motion.  The SEC Production provided a
more comprehensive review of issues related to KPMG's
independence, not raised by the States in the Disqualification
Motion.

Judge Gonzalez also holds that "[t]he interests of all creditors
in these Chapter 11 cases would have been hindered by the
disqualification, as emergence could have been delayed without
any foreseeable benefit to the Debtors' estates."  The delay in
bringing the Disqualification Motion until the eve of the
Debtors' emergence from bankruptcy was potentially disruptive to
the Debtors' reorganization.  The disqualification would have
potentially delayed the Effective Date of the Plan while the
Debtors retained new auditors to certify the 2003 financials,
delaying resolution of tax claims of Massachusetts and the other
states and distributions to all creditors.  Had the States raised
the issue at an earlier juncture in the case, the Court could
have taken corrective measures to address the States' concerns,
if warranted.

Judge Gonzalez further finds that the States, in addition to
having filed the Disqualification Motion as a litigation tactic,
was dilatory in the prosecution of the Disqualification Motion.

The Court directs the Debtors to resume payments to KPMG under
the Monthly Compensation Order, including any accrual of payments
since March 19, 2004.

Headquartered in Clinton, Mississippi, WorldCom, Inc., now known
as MCI-- http://www.worldcom.com-- is a pre-eminent global  
communications provider, operating in more than 65 countries and
maintaining one of the most expansive IP networks in the world.  
The Company filed for chapter 11 protection on July 21, 2002
(Bankr. S.D.N.Y. Case No. 02-13532).  On March 31, 2002, the
Debtors listed $103,803,000,000 in assets and $45,897,000,000 in
debts.

On April 20, the company (WCOEQ, MCWEQ) formally emerged from U.S.
Chapter 11 protection as MCI, Inc. This emergence signifies that
MCI's plan of reorganization, confirmed on October 31, 2003, by
the U. S. Bankruptcy Court for the Southern District of New York
is now effective and the company has begun to distribute
securities and cash to its creditors. (Worldcom Bankruptcy News,
Issue No. 57; Bankruptcy Creditors' Service, Inc., 215/945-7000)  


W.R. GRACE: Futures Rep. Taps Phillips Goldman & Spence as Counsel
------------------------------------------------------------------
In W.R. Grace & Co.'s chapter 11 cases, David T. Austern, the
legal representative of future asbestos personal injury claimants,
asks the Bankruptcy Court for permission to retain Phillips
Goldman & Spence, PA, in Wilmington, Delaware, as his local
counsel, retroactive to May 24, 2004.

Specifically, Phillips Goldman will:

       (1) provide legal advice and representation with respect
           to the Futures Representative's powers and duties in
           connection with the Debtors' Chapter 11 cases, and any
           matters which may arise, including in connection with
           appropriate due diligence, the formulation of a plan,
           and one or more asbestos payment trusts;

       (2) prepare and file on the Futures Representative's
           behalf applications, motions, responses, objections
           and other pleadings as necessary and as authorized by
           the Futures Representative;

       (3) appear on the Futures Representative's behalf in the
           Debtors' Chapter 11 cases for hearings, meetings of
           creditors, and other matters as appropriate;

       (4) advise and represent the Futures Representative with
           respect to any contested matter, adversary proceeding,
           lawsuit or other proceeding to which the Futures
           Representative may be a party; and

       (5) perform all other necessary legal services that the
           Futures Representative authorizes or requests.

On the Futures Representative's behalf, Phillips Goldman has
begun conducting due diligence with respect to the Debtors and
their non-debtor affiliates, their financial affairs, prepetition
transactions, postpetition matters, and proposals regarding
potential plans of reorganization.

John C. Phillips, Esq., a director at Phillips Goldman, assures
the Court that neither he nor his firm have or represent any
interests adverse to the Futures Representative or the Debtors'
estates on the matters for which approval of his firm's retention
is sought.  Phillips Goldman is a "disinterested person" within
the meaning of the Bankruptcy Code. (W.R. Grace Bankruptcy News,
Issue No. 65; Bankruptcy Creditors' Service, Inc., 215/945-7000)


Y-USA INC: Case Summary & 8 Largest Unsecured Creditors
-------------------------------------------------------
Debtor: Y-USA Inc.
        615 Nash Street Suite 204
        El Segundo, California 90245

Bankruptcy Case No.: 04-24293

Type of Business: The Debtor distributed DVD players until
                  adverse by GBM Logistic forced it out of
                  business.

Chapter 11 Petition Date: June 29, 2004

Court: Central District of California (Los Angeles)

Judge: Ellen Carroll

Debtor's Counsel: R. Gibson Pagter Jr., Esq.
                  Pagter & Miller
                  1551 North Tustin Avenue, #850
                  Santa Ana, CA 92705-8636
                  Tel: 714-541-6072

Total Assets: Unknown

Total Debts:  $17,000,000

Debtor's 8 Largest Unsecured Creditors:

Entity                        Nature Of Claim       Claim Amount
------                        ---------------       ------------
GBM Logistic Services, Inc.   Trade Debt             $17,146,413
c/o James F. Lindsay
Homberger & Brewer, LLP
444 So. Flower St., Ste 3010
Los Angeles, CA 90071-2901

Calpima Intern. (Macau)       Trade Debt                 $67,375
Trading

U-Sheng Electronics Co. Ltd.  Trade Debt                  $1,255

Douglas J. Pettibone          Notice Only              Duplicate
                              (Attorney for Arthur
                              Blancone)

Stuart Wallach                Trade Debt           To be amended

Christopher Nance             Trade Debt           To be amended

Airwaves International        Trade Debt           To be amended
Freight

Arthur Blancone               Trade Debt           To be amended


* Ballenger, Cleveland & Issa Expands Into High Growth Market
-------------------------------------------------------------
The corporate consulting firm of Ballenger, Cleveland & Issa, LLC
is pleased to announce the establishment of its new "Emerging and
High Growth Companies" consulting practice area. BCI has
established this new practice area to provide "value-added"
services to those small and mid-sized companies experiencing high
growth. One of the cornerstone services of this new practice area
will be the provision of new capital through BCI's merchant
banking group. The move to create this new practice area is
designed to expand upon the Firm's long-established Reorganization
and Insolvency Consulting expertise and existing client base, a
client base that has benefited from the expertise of BCI and its
team of professionals over the past twenty years.

"Establishing an 'Emerging and High Growth Companies' practice
area is a natural step for BCI," says J. Michael Issa, Executive
Managing Director of BCI. "The same principles we employ in the
'turnaround and crisis management' process for troubled companies
can greatly benefit those emerging and high growth companies in
need of additional management support and new capital sources in
order to maximize their potential to reach their next level of
success."

BCI's new "Emerging and High Growth Companies" practice area
consists of the following services:

-- General Business Management and Consultation

-- Merchant and Investment Banking

-- Merger, Sale or Acquisition Due Diligence

-- Strategic Planning

According to Christopher Wheeler, Managing Director of Special
Industries at BCI, the expansion of services provided by BCI is
also expected to be a logical extension of the firm's practice.
"Given the scope of services traditionally offered by BCI, most of
our clients didn't need our help once restored to health. Now we
can offer those same clients additional assistance along their
path to continued success and growth."

Mr. Issa added, "More and more we see companies that cannot handle
the business trauma and crisis-like climate that rapid growth can
have on an emerging business. Because we have the knowledge and
experience to deal with crises, BCI is well positioned to provide
assistance to these companies before this growth turns from a
positive to a negative."

Ballenger Cleveland & Issa, LLC is a leading provider of corporate
consulting and merchant banking services to companies with high
growth potential in a broad range of industries and disciplines.
From its three offices located in Southern California, BCI
professionals are available to provide hands-on, specialized
assistance in complex matters to domestic and international
clients whose businesses are in transition or experiencing rapid
growth. Without exception, the professionals at BCI each have
decades of extensive hands-on operating experience in senior
executive positions at numerous companies in a diverse range of
industries. To learn more about BCI please visit
http://www.bcillc.com/


* BOND PRICING: For the week of July 12 - July 16, 2004
-------------------------------------------------------   

Issuer                                Coupon   Maturity  Price  
------                                ------   --------  -----  
American & Foreign Power               5.000%  03/01/30    67  
AMR Corp.                             10.200%  03/15/20    73
Burlington Northern                    3.200%  01/01/45    54  
Calpine Corp.                          7.750%  04/15/09    62  
Calpine Corp.                          8.500%  02/15/11    63  
Calpine Corp.                          8.625%  08/15/10    63  
Calpine Corp.                          8.750%  07/15/07    69  
Comcast Corp.                          2.000%  10/15/29    38  
Continental Airlines                   4.500%  02/01/07    71
Cummins Engine                         5.650%  03/01/98    71  
Delta Airlines                         2.875%  02/18/24    63
Delta Airlines                         7.700%  12/15/05    65
Delta Airlines                         7.900%  12/15/09    49
Delta Airlines                         8.300%  12/15/29    40
Delta Airlines                         9.00%   05/15/16    44
Delta Airlines                         9.250%  03/15/22    42
Delta Airlines                         9.750%  05/15/21    43
Delta Airlines                        10.125%  05/15/10    51
Delta Airlines                        10.375%  02/01/11    51    
Elwood Energy                          8.159%  07/05/26    71  
Inland Fiber                           9.625%  11/15/07    51  
Missouri Pacific                       4.750%  01/01/30    73  
National Vision                       12.000%  03/30/09    62    
Northwest Airlines                     7.875%  03/15/08    71  
Northern Pacific Railway               3.000%  01/01/47    53
Level 3 Communications                 2.875%  07/15/10    73

                           *********

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.

Each Friday's edition of the TCR includes a review about a book of
interest to troubled company professionals. All titles are
available at your local bookstore or through Amazon.com. Go to
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Monthly Operating Reports are summarized in every Saturday edition
of the TCR.

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., Fairless Hills, Pennsylvania,
USA, and Beard Group, Inc., Frederick, Maryland USA. Yvonne L.
Metzler, Bernadette C. de Roda, Rizande B. Delos Santos, Paulo
Jose A. Solana, Jazel P. Laureno, Aileen M. Quijano and Peter A.
Chapman, Editors.

Copyright 2004.  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
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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-
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for the term of the initial subscription or balance thereof are
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                *** End of Transmission ***