TCR_Public/040730.mbx         T R O U B L E D   C O M P A N Y   R E P O R T E R

             Friday, July 30, 2004, Vol. 8, No. 158

                           Headlines

360NETWORKS: Empowered Networks Allowed a $355,244 Unsecured Claim
469 CORP: Voluntary Chapter 11 Case Summary
ABSOLUT RESOURCES: Completes $3.36 Million Private Placement
ADELPHIA COMMS: Court Approves Beaver Creek Sale to Grant Reimer
ADELPHIA COMMS: U.S. Trustee Restructures Creditors Committee

AEP INDUSTRIES: Spanish Subsidiary Files for Payment Suspension
AIR CANADA: WestJet Wants to Pursue Counterclaims Against Airlines
AMERICAN PLUMBING: Court Confirms Reorganization Plan
ANC RENTAL: Reports Status of Avoidance Actions
ANSCOTT INDUSTRIES: Replaces Madsen with Marcum & Kliegman

ARLINGTON HOSPITALITY: Franchisees Acquire Ground Round Assets
ATLAS AIR: Joint Reorganization Plan Declared Effective
BEAL FINANCIAL: S&P Withdraws BB- Ratings at Company Request
BIOPHAGE PHARMA: Second Quarter 2004 Net Loss Narrows to $226,610
CANDESCENT: Wants Meetin's Service as Patent Counsel to Continue

CATHOLIC CHURCH: U.S. Trustee Unable to Appoint Trade Committee
CYGENE LAB: Hires Eisner to Replace Brimmer, Burek & Keelan
DB COMPANIES: Creditors Must File Claims by October 1, 2004
DEVON MOBILE: Liquidating Trustee Issues Second Quarter Report
DIAMETRICS MEDICAL: KPMG Declines Reappointment as Accountant

ECU SILVER: Plans to Raise CDN$2-7 Mil. from Private Placement
ENRON CORP: Asks Court to Allow $25M Replacement DIP Financing
ENRON CORP: Wants to Reimburse NuCoastal's $15 Mil. Expenses
EUROPA ONE: S&P Upgrades Class E Rating to BBB From BB
EXIDE TECH: Blackstone Asks for $9.3 Million Final Fees

FEDERAL-MOGUL: Appoints Robert Miller, Jr., as Interim CEO
FINDEX.COM: Closes $1.75M Financing Agreement with Barron Partners
FINOVA GROUP: Commerce Capital Presses $273,000 Damage Claim
FLEMING COMPANIES: Asks Court to Approve Bayfest, et al., Accord
FLINTKOTE: James McMonagle Nominated as Future Claimants' Rep.

GIANT JR.: Kabani to Replace Weaver as Independent Accountants
GLOBAL GOLD: Terminates Marcum & Kliegman as Certifying Accountant
HOLLINGER INC: Appeals Delaware Chancery Court Ruling
INDEPENDENCE II: Fitch Cuts Preference Shares' Rating to CCC
INNOPHOS INC: S&P Assigns B+ Corporate Credit Rating

INTERTAPE POLYMER: Subsidiary Completes $125 Million Debt Offering
J.P. MORGAN CHASE: Fitch Upgrades Low B Ratings for 6 Classes
JEUNIQUE INTERNATIONAL: 4-Member Creditors Committee Appointed
KMART CORP: Wants Late-Filed Multi-Million Claims Disallowed
MACH ONE 2004: Fitch Assigns Lower B Ratings on 6 Classes

LANTIS EYEWEAR: Has Until October 22 Decide on Unexpired Leases
MCCANN INC: Involuntary Chapter 11 Case Summary
MCCANN: Lee Buchwald Appointed as Chapter 11 Trustee
MIRANT CORP: Committee Wants to Discharge Huron Consulting
MOHEGAN TRIBAL: Prices $200 Million Senior Debt Offering

NEW WORLD PASTA: Committee Hires Blank Rome as Local Counsel
NORTHWEST AIRLINES: S&P Lowers Rating to B & Says Outlook Negative
NRG ENERGY: Commodity Futures Trading Comm. Alleges Violations
NUCOTEC INC: Reuben to Replace Stonefield Josephson as Auditors
OCUMED GROUP INC: Case Summary & 20 Largest Unsecured Creditors

OPTICAL SENSORS: Engages Virchow Krause to Replace Ernst & Young
OWENS CORNING: Former Judge Wolin to Join Advisor Gross's Law Firm
PAC-WEST: Settles Various Claims & Disputes with SBC California
PACIFIC GAS: Court Dismisses CPUC Appeal from Confirmation Order
PARMALAT GROUP: Industry Minister Approves Restructuring Plan

PEGASUS SATELLITE: Hires PwC as Accountant & Auditor
PERSONA: Gets Final Regulatory Approval to Implement CCAA Plan
PG&E NATIONAL: Wants Court Approval of Key Employee Retention Plan
PRESTIGE BRANDS: S&P Puts Senior Debt Rating on Watch Negative
RBX INDUSTRIES: Plans to Sell Groendyk Division to Magnifoam Tech

RELIANCE GROUP: Committees Want 12 Multi-Million Claims Expunged
SECURUS TECH: S&P Assigns B+ Corporate Credit & Sr. Debt Ratings
SHEFFIELD: S&P Gives B- Secured Debt & Corporate Credit Ratings
SPIEGEL: Eddie Bauer Wants to Sell Redmond Property for $38 Mill.
STRONGBOW: Joins Forces with Allyn to Explore Greenstone Belt

U.S. CANADIAN MINERALS: Dismisses Beckstead and Watts
UNITED AIRLINES: Former Workers Agree to Huge Reduction in Claims
URS CORP: Wins $275 Million Ten-Year US Postal Service Contract
US UNWIRED: Reports $217.6 Mil Stockholders' Deficit at June 30
VERTIS INC: Stockholders' Deficit Widens to $363.5 Million

VITAL BASICS: Wants to Hire Mitchell Williams as Special Counsel
W.R. GRACE: Court Approves Streamlined Claims Objection Process
WATERLINK: Senior Secured Lenders Recover 90%+ of Their Claims
WEIRTON STEEL: Resolves Independent Guards Union Claims
WESTAR FINANCIAL: Court Approves Plan of Liquidation

WH SMITH: Fitch Places Sr. Unsecured BB+ Rating on Watch Negative
WORLDCOM INC: Citigroup Settles Class Action for $2.65 Billion

* Jeffrey R. Manning to Lead FTI Capital Advisors
* Consumer Bankruptcy Filings Show First Decline in Four Years

* BOOK REVIEW: Lost Prophets

                           *********


360NETWORKS: Empowered Networks Allowed a $355,244 Unsecured Claim
------------------------------------------------------------------
To settle a lawsuit brought by the Official Committee of Unsecured
Creditors and 360 USA in 360networks, Inc. Chapter 11 cases, the
Creditors Committee and Empowered Networks, Inc., stipulate and
agree that:

    (a) Empowered will pay to the Committee, on behalf of the
        Debtors' estates, $100,000 in full and final satisfaction
        and discharge of the claims arising from or related to
        the Payments;

    (b) The parties forever release, waive and discharge each
        other from any action, suits, debts, and claims related
        to the Complaint or the Payments; and

    (c) Empowered will hold an Allowed Unsecured Claim against
        the Debtors for $355,244.

Headquartered in Vancouver, British Columbia, 360networks, Inc. --
http://www.360.net/-- is a leading independent provider of fiber  
optic communications network products and services worldwide. The
Company filed for Chapter 11 protection on June 28, 2001 (Bankr.
S.D.N.Y. Case No. 01-13721), obtained confirmation of a plan on
October 1, 2002, and emerged from Chapter 11 on November 12, 2002.  
Alan J. Lipkin, Esq., and Shelley C. Chapman, Esq., at Willkie
Farr & Gallagher, represent the Company before the Bankruptcy
Court.  When the Debtors filed for protection from its creditors,
they listed $6,326,000,000 in assets and $3,597,000,000 in
liabilities. (360 Bankruptcy News, Issue No. 72; Bankruptcy
Creditors' Service, Inc., 215/945-7000)   


469 CORP: Voluntary Chapter 11 Case Summary
-------------------------------------------
Debtor: 469 Corp.
        469 Ocean Grove Avenue
        Swansea, Massachusetts 02777

Bankruptcy Case No.: 04-16198

Chapter 11 Petition Date: July 27, 2004

Court: District of Massachusetts (Boston)

Judge: Carol J. Kenner

Debtor's Counsel: Lloyd Earl Belford, Esq.
                  Belford & Stone
                  279 North Main St.
                  Fall River, MA 02720
                  Tel: 508-674-8447

Estimated Assets: $1 Million to $10 Million

Estimated Debts:  $1 Million to $10 Million

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


ABSOLUT RESOURCES: Completes $3.36 Million Private Placement
------------------------------------------------------------
Absolut Resources Corporation has completed its previously
announced brokered private placement of 3,365,000 units of the
Company at a price of $1.00 per unit, for total proceeds of
$3,365,000.  In addition to the 3,000,000 units previously
reported, the underwriters exercised an over-allotment option to
purchase an additional 365,000 units.  Each unit consists of one
common share and one-half of one common share purchase warrant.  
Each whole purchase warrant entitles the holder to purchase one
common share at a price of $1.15 per share until July 27, 2005.

Sprott Securities Inc. and Dundee Securities Corporation acted as
the underwriters for the private placement.  The underwriters
received a commission of $155,000 and compensation warrants to
purchase an aggregate of 365,000 units at $1.00 per until
July 27, 2005, having the same terms as those issued pursuant to
the Offering.

The securities issued in this private placement are subject to a
four-month hold period expiring November 28, 2004.

Proceeds of the private placements will be used to continue
exploration and drilling on the Pico Machay High Sulphidation
Gold Project in Peru, evaluation and exploration of the projects
covered by the Company's Northern Peru AngloGold partnership
agreement and for general corporate purposes. Drilling at Pico
Machay is scheduled to resume in September 2004.

Absolut Resources Corp. is a precious metals exploration and
development company based in Toronto, Canada.  Absolut strongly
believes in an international best practices approach, and
implements this on all its social and environmental decisions.
Absolut has implemented a quality control program to ensure best
practice and the company's consultants Ironbark Geoservices SRL is
providing technical management to the project.  Under the
guidelines of the 43-101 National Instrument the required
qualified person for the Pico Machay Gold Project is Mr. Dan Noone
who is a member of the Australian Institute of Geoscientists.

                         Going Concern Doubt

The Company's 2003 Annual Report stated:

   "The Company that it has incurred continual losses.  Its    
    continued existence is dependent on its ability to carry out
    its business plans to raise additional funding and achieve
    profitability.  Failure to achieve a favorable financial
    position as described above may result in financial
    difficulties, which would make the use of the going concern
    assumption invalid.  If the going concern assumption was not
    appropriate for these financial statements, then adjustments
    would be necessary to the carrying values of assets and
    liabilities and the reported expenses and the balance sheet
    classifications used."


ADELPHIA COMMS: Court Approves Beaver Creek Sale to Grant Reimer
----------------------------------------------------------------
Adelphia Communications Corporation and its debtor-affiliates
conducted a telephonic auction on July 7, 2004, to consider higher
or better offers for the purchase of real property located at
61 Greystone Court, Unit 61, in Beaver Creek Colorado.  The
Debtors determined that the offer from Grant Riemer is the highest
and best bid.

Subsequently, Judge Gerber of the United States Bankruptcy Court
for the Southern District of New York authorized the ACOM Debtors
to sell the Beaver Creek Property to Mr. Riemer for an undisclosed
price.

Adelphia Communications Corporation and its more than 200
affiliates filed for Chapter 11 protection in the Southern
District of New York on June 25, 2002.  Those cases are jointly
administered under case number 02-41729. Willkie Farr & Gallagher
represents the ACOM Debtors. (Adelphia Bankruptcy News, Issue No.
64; Bankruptcy Creditors' Service, Inc., 215/945-7000)  


ADELPHIA COMMS: U.S. Trustee Restructures Creditors Committee
-------------------------------------------------------------
Deirdre A. Martini, the United States Trustee for Region 2,
advised the United States Bankruptcy Court for the Southern
District of New York that Home Box Office and Viacom are no longer
members of the Official Committee of Unsecured Creditors of
Adelphia Communications Corporation, et al.  The Committee is now
composed of six members:

    1. Appaloosa Management, LP
       26 Main Street, Chatham, NJ 07928
       Attn: James Bolin
       Phone: (973) 701-7000   Fax: (973) 701-7309

       Counsel: Akin Gump Strauss Hauer & Feld, LLP
                590 Madison Avenue, New York, New York 10022
                Attn: Daniel Golden, Esq.
                Phone: (212) 872-8010

    2. W. R. Huff Asset Management Co., LLC
       67 Park Place, Morristown, NJ 07960
       Attn: Edwin M. Banks, Senior Portfolio Manager
       Phone: (973) 984-1233   Fax: (973) 984-5818

       Counsel: Kasowitz, Benson, Torres & Friedman, LLP
                1633 Broadway, New York, New York 10019-6799
                Phone: (212) 506-1700   Fax: (212) 506-1800

                Klee Tuchin & Bogdanoff & Stern, LLP
                1880 Century Park East, Los Angeles, CA 90067-1698
                Phone: (310) 407-4000   Fax: (310) 407-9090

    3. MacKay Shields, LLC
       9 West 57TH Street, New York, New York 10019
       Attn: Ben Renshaw, Associate Director
       Phone: (212) 230-3836   Fax: (212) 754-9187

    4. Law Debenture Trust Company of New York
       767 Third Avenue, 31st Floor, New York, New York 10017
       Attn: Daniel R. Fisher, Senior Vice President
       Phone: (212) 750-6474   Fax: (212) 750-1361

       Counsel: Seward & Kissel, LLP
                One Battery Park Plaza
                New York, New York 10004
                Attn: Ronald L. Cohen, Esq.
                Phone: (212) 575-1515

    5. U.S. Bank National Association, as Indenture Trustee
       1420 Fifth Avenue, 7th Floor, Seattle, WA 98101
       Attn: Diana Jacobs, Vice President
       Phone: (206) 344-4680   Fax: (206) 344-4632

       Counsel: Sheppard, Mullin, Richter & Hampton, LLP
                333 South Hope Street, Los Angeles, CA 90071-1448
                Attn: David J. McCarty, Esq.
                T. William Opdyke, Esq.
                Phone: (213) 617-1780   Fax: (213) 620-1398

    6. Sierra Liquidity Fund, LLC
       2699 White Road, Suite 255
       Irvine, CA 92614
       Attn: Jim Riley, Esq.
       Phone: (949) 660-1144, ext. 16
       Fax: (949) 660-0632

Adelphia Communications Corporation and its more than 200
affiliates filed for Chapter 11 protection in the Southern
District of New York on June 25, 2002.  Those cases are jointly
administered under case number 02-41729. Willkie Farr & Gallagher
represents the ACOM Debtors. (Adelphia Bankruptcy News, Issue No.
65; Bankruptcy Creditors' Service, Inc., 215/945-7000)  


AEP INDUSTRIES: Spanish Subsidiary Files for Payment Suspension
---------------------------------------------------------------
AEP Industries Packaging Espana SA, a Spanish subsidiary of AEP
Industries Inc. (Nasdaq: AEPI), has filed for Suspension of
Payments status under Spanish law.  The filing has been prompted
by a demand for repayment by one of AEP Spain's lending banks.

Year-to-date (6/30/04) sales by AEP Spain were approximately
$10.6 million, with an operating loss of approximately
$0.9 million and a cash-flow loss of approximately $0.4 million.
The strength of the Euro has had a severely negative impact on AEP
Spain's business and prospects.  AEP Spain has not been profitable
on an operating basis for the past three fiscal years and
represented 3.3% of the consolidated total assets of the Company
for its fiscal year ended October 31, 2003.

The Company is working with AEP Spain to identify possible
alternatives, including a sale of the business or an orderly
liquidation of this subsidiary, which could result in additional
charges to operations.

AEP Industries Inc. manufactures, markets, and distributes an
extensive range of plastic packaging products for the
food/beverage, industrial and agricultural markets.  The Company
has operations in ten countries throughout North America, Europe
and Australasia.


AIR CANADA: WestJet Wants to Pursue Counterclaims Against Airlines
------------------------------------------------------------------
WestJet Airlines, Ltd., and its former Vice-President of
Strategic Planning, Mark Hill, ask Mr. Justice Farley to lift the
CCAA stay in the Air Canada CCAA cases so they may commence and
proceed with a counterclaim against Air Canada, ZIP Air, Inc., and
others.

                      Corporate Espionage

WestJet and Mr. Hill are defendants in a litigation brought by
Air Canada and its debtor affiliates -- the Applicants -- and ZIP
for breach of corporate security.  The Applicants accuse WestJet,
and in particular Mr. Hill, of accessing confidential information
through Air Canada's employee travel Web site.  The Applicants
allege that under Mr. Hill's direction, WestJet obtained through
Jeffrey Lafond, a former employee of Canadian Airlines
International, Ltd., and misused on a massive scale, Air Canada's
flight load and load factor information and booking information.  
WestJet purportedly used Mr. Lafond's PIN to improperly access the
site.

Mr. Lafond is also a defendant in the litigation.  Mr. Lafond
currently works as financial analyst for WestJet.

                  WestJet Denies Allegations

WestJet denies illegally accessing the Applicants' confidential
information.  At all relevant times, there was nothing on the Web
site stating it was confidential.

Mr. Hill denies that the Web site contains Load and Load factor
information.  Mr. Hill explains that the Load and Load factor for
a flight cannot be determined from the information on the Web
site.  However, the number of seats that have been booked on a
future flight between the cities noted, as of a particular date,
can be calculated.

More importantly, WestJet also denies using the Web site
information in any way related to any of its business decisions.
WestJet denies that any information on the Web site would give the
Applicants' competitors detailed and accurate information on the
success of the Applicants' routes and market conditions.  WestJet
contends that the Web site information can't even be used to:

    -- identify and target the Applicants' most profitable flights
       and times, and adjust WestJet's schedules accordingly;

    -- plan WestJet's expansion into new routes;

    -- optimize WestJet's revenue on specific routes;

    -- intentionally reduce the Applicants' revenues; and

    -- adopt pricing strategies intended to force the Applicants
       out of the markets.

WestJet is also not aware that Mr. Lafond had signed a release or
any other agreement with CAIL containing a provision not to
disclose confidential information of CAIL.  WestJet tells the CCAA
Court that Air Canada gave Mr. Lafond access to its Web site more
than two years after Mr. Lafond signed the release, in
circumstances that have nothing to do with any confidential
obligations Mr. Lafond could owe CAIL.  Mr. Lafond had travel
privileges with Air Canada until December 31, 2003.  Air Canada
imposed no conditions of confidentiality or any other conditions
on Mr. Lafond's use of the PIN or the Web site.

WestJet discloses that Mr. Lafond first accessed Air Canada's Web
site in March 2003.  Thereafter, Mr. Lafond provided his PIN to
Mr. Hill.  WestJet relates that Mr. Hill is responsible for
observing and monitoring the airline industry, corporate real
estate and representing WestJet to certain governmental and non-
governmental organizations.  Mr. Hill is not responsible for
scheduling, planning or marketing for WestJet.

          Mark Hill Accessed Site to Satisfy Curiosity

WestJet admits that Mr. Hill accessed Air Canada's Web site on a
regular basis to view the information posted on the site.  The
information enabled Mr. Hill to compare WestJet Loads with
estimated Air Canada or ZIP Loads -- a comparison otherwise
available to Mr. Hill at the time by counting passengers or
through other sources.

WestJet assures the Court that the Web site information was of
interest to Mr. Hill but of no use to and not used by WestJet.
The comparison served the limited purpose of satisfying Mr.
Hill's interest and curiosity regarding the Applicants' Loads
without the necessity of counting passengers or accessing the
information from other sources.

      Air Canada Consented to Mark Hill's Continued Access

WestJet maintains that in the late Spring or early Summer 2003,
Steve Smith, then president of ZIP, became aware that Mr. Hill had
the Applicants' Load information and believed that Mr. Hill was
obtaining the information from the Web site or from Air Canada's
reservation system.  But while Air Canada could have then
identified whether and how Mr. Hill was accessing the site and
terminated that access, Air Canada did not terminate Mr. Hill's
access.  Air Canada allowed it to continue, knowing that the
information was not confidential and had no value to a competitor.

In December 2003, Mr. Smith was advised that Mr. Hill was
accessing the Web site using Mr. Lafond's PIN.  Again, Air Canada
could have terminated Mr. Hill's access, but did not.

When Mr. Lafond's travel privileges expired on December 31, 2003,
Air Canada did not terminate his access to the Web site.
According to WestJet, Mr. Hill stopped accessing the Web site in
March 2004.

                  WestJet's Counterclaims

During the course of the cross-examinations in the litigation in
June 2004, WestJet and Mr. Hill learned that Air Canada and ZIP
and their agents unlawfully removed and retained WestJet's
confidential financial information from Mr. Hill's property.  Air
Canada hired private investigators Jasper Smith and David Wiggs of
IPSA International, Inc., to enter into Mr. Hill's home in Oak
Bay, British Columbia.  Disguised as employees of the Municipality
of Oak Bay Sanitation Department, the Private
Investigators seized WestJet business records and other materials
that Mr. Hill had intended to recycle.

The seized documents include copies or excerpts of:

    (1) revenue by flight calculations and other current financial
        information regarding revenue earned for March and April
        2004;

    (2) draft internal WestJet financial statements and line by
        line details of WestJet's revenues and expenses;

    (3) 2004 budget information and comparison of actual
        performance to budget;

    (4) capital budget information;

    (5) confidential fleet planning documents;

    (6) WestJet compensation analysis and compensation committee
        documents; and

    (7) confidential WestJet communications from third parties.

WestJet believes that the Applicants digitally recreated the
shredded documents.  The Applicants have refused to return the
wrongfully seized documents.

WestJet fears that the Applicants have and will use the
confidential information for their benefit.  WestJet has suffered
and will continue to suffer harm and damages if the Applicants are
not restrained from the unlawful exploitation of the confidential
information.

WestJet and Mr. Hill ask Mr. Justice Farley to compel the
Applicants and the Private Investigators to return all
confidential documents the Applicants seized from Mr. Hill, and
enjoin the Applicants and the Investigators from disclosing the
confidential information.

WestJet and Mr. Hill also seek from the Applicants, the Private
Investigators and IPSA International:

       (i) CN$5,000,000 in punitive damages; and

      (ii) damages for invasion of privacy, trespassing, and
           intentional interference with economic interests in an
           amount to be determined by the Court.

WestJet and Mr. Hill ask the Court to dismiss the Applicants'
action with costs.

                      WestJet Is Not to Blame

WestJet and Air Canada are rivals in the domestic airline industry
in Canada.  Between 1998 and 2003, WestJet's share of the Canadian
domestic airline market increased from 4% to 24%, while the
domestic market share of Air Canada, together with CAIL and their
regional carriers, decreased from over 90% to about two-thirds.

WestJet denies that the access to the information on the
Applicants' Web site has caused the Applicants loss of revenue,
profits and good will, or has resulted in the Applicants' place in
the market being irreparably damaged.  WestJet maintains that the
Applicants' downfall has been caused by:

    (1) mismanagement of their business;

    (2) their decisions to persist in selling seats on flights for
        less than their cost to attempt to preserve market share
        and harm competitors;

    (3) their high cost structure; and

    (4) the poor treatment of their customers.

In contrast, the expansion of WestJet's service, revenue and
profitability has been and continues to be as a result of the
company being a well-managed business with a viable business
model.

                Go Ahead, Air Canada Dares WestJet

Air Canada issued the following statement regarding WestJet's
motion for leave to counterclaim against Air Canada:

      Air Canada will not oppose a motion on July 22 by WestJet
and its former Vice President of Strategic Planning, Mark Hill,
for leave to bring counterclaims against Air Canada in the current
litigation surrounding the admitted gathering and use by
WestJet's management of Air Canada's confidential information.

      WestJet's and Mr. Hill's counterclaims are entirely without
merit.  They are a diversionary tactic designed to deflect
attention from WestJet's and Mr. Hill's acts.

      Mr. Hill has admitted thus far that he and other management
improperly accessed Air Canada's confidential employee Web site,
created software to facilitate and accelerate the gathering of
information from the site, and created reports comparing Air
Canada's and WestJet's load factors on specific routes, and
examined Air Canada's best-performing routes.

      Mr. Hill resigned from WestJet last week, several months
after being placed on paid leave in the aftermath of it becoming
publicly known that he and WestJet had surreptitiously accessed
Air Canada's proprietary competitive information.

      The Company looks forward to hearing in open court WestJet's
explanation for improperly accessing Air Canada's confidential
employee Web site approximately a quarter of a million times over
a 12-month period.

      Air Canada will vigorously defend itself against the
counterclaims and is confident that courts will ultimately decide
that WestJet's and Mr. Hill's claims are without merit.

                        Sufficient Evidence

Brian N. Radnoff, Esq., at Lerners, LLP, in Toronto, Ontario,
tells Mr. Justice Farley that the evidence the Applicants obtained
through their investigations and through cross-examinations
demonstrates the massive accessing and misuse of the Applicants'
confidential information from their employee Web site by WestJet
and Mark Hill from March 2003 to March 2004.

As a result of the investigation, the Applicants found out that:

       (i) Mr. Hill was using and preparing reports incorporating
           the confidential information he obtained from the Air
           Canada Web site -- information that he shared with
           other senior WestJet executives; and

      (ii) after being tipped of about the investigation, Mr. Hill
           attempted to destroy the documents -- demonstrating his
           possession and use of the Web site information.

Mr. Radnoff contends that the documents retrieved from Mr. Hill's
garbage, as well as his other admissions in the cross-
examination, have undermined WestJet's defense to the Applicants'
action.  WestJet may be liable to the Applicants for significant
compensatory and punitive damages.

So long as WestJet's and Mr. Hill's counterclaims do not slow down
the progress of the litigation, the Applicants do not oppose to
WestJet and Mr. Hill pursuing the counterclaims.

           WestJet and Hill's Assertions Are Not True

The Applicants confirm arranging for the retrieval of Mr. Hill's
garbage on two occasions in March and April 2004.  The Applicants'
investigators, who were former officers of the Royal Canadian
Mounted Police, contracted the garbage retrieval to a global
security firm, IPSA International.

The Applicants observe that most of WestJet and Mr. Hill's
assertions are incorrect.  The Private Investigators were
instructed not to enter onto Mr. Hill's private property when
removing Mr. Hill's garbage.  The Investigators conducted their
probe in accordance with the law and respect the privacy of their
investigation subjects.  The Investigators never entered Mr.
Hill's driveway or any other part of his property to remove
garbage.

Jasper Smith, one of the Investigators, tells the CCAA Court that
the laneway into the development where Mr. Hill lives is not a
private road and is open to public access and use.  Mr. Hill
placed his refuse bins on the laneway and not on his driveway.

Mr. Smith also recalls that Mr. Hill did not stop them from
removing his garbage despite the fact that Mr. Hill took pictures
of them and shouted at them, suspecting that they were Air Canada
investigators.

                       Mock Business Plan

According to Mr. Smith, Mr. Hill placed documents in his garbage
for Air Canada to see.   The documents include a mock business
plan, which contains insults to Air Canada and its employees.  Mr.
Smith recalls that some copies of the mock business plan had been
cut into thick strips by hand, so that they were easily legible.

                   WestJet's 2004 Business Plan
                          Top Secret !!!!

      (1) Buy a schwak of airplanes.  737's, F100's, Yakovlev's,
          whatever we can get our hands on.

      (2) Launch hourly shuttle service between Red Deer and
          Pembroke.

      (3) Party like it's 2009.

      (4) Send Milty a Christmas Card.

      (5) Clean out my desk.

      (6) Take digital photos of the two morons digging thru my
          garbage looking for proprietary WestJet information.

      (7) Make said photos available to the RCMP, the Globe and
          Mail, the National Post.

      (8) Embarrass the crap out of Milty for authorizing such
          stupid[ity].

      (9) Watch Len and Doug squirm.

     (10) Watch Milty be fired by the BoD for cause.

     (11) Watch Milty skulk back across the border where he came
          [from].

     (12) Create more shareholder value for WJ investors.

                     HAVE A NICE DAY, BOYS.

"Milty," of course, refers to Robert Milton, Air Canada's CEO.

                  Counterclaims Have No Merit

Mr. Radnoff asserts that WestJet's and Mr. Hill's counterclaims
have no merit and are no more than a diversionary tactic to take
away attention from the established massive improper access and
use of the Applicants' confidential information.  The documents
WestJet and Mr. Hill alleged contain their confidential
information are fragmentary or illegible.  It is not clear that
someone other than Mr. Hill or a WestJet representative could
identify them, let alone use them.  To the extent the documents
are legible and understandable, the Applicants have used the
documents for no other purpose other than for their action against
WestJet, Mr. Hill and Mr. Lafond.

In addition, WestJet cannot assert a claim for damages for
invasion of privacy and trespassing on Mr. Hill's property.
Similarly, Mr. Hill cannot assert a claim for damages for Air
Canada obtaining and allegedly using WestJet's confidential
information.  Only WestJet can bring a claim to protect its
confidential information.

Mr. Hill also has no privacy or confidentiality rights in garbage.  
Mr. Radnoff points out that the deliberate discarding or
abandonment of trash makes it logical to conclude that a person
who has discarded or abandoned the items no longer has as a
subjective expectation of privacy concerning them.  Putting
material in garbage signifies that the material is no longer
something of value or importance to the person disposing of it,
and that there is no reason or need to retain it.

          Air Canada Seeks $220,000,000 from WestJet

Air Canada filed an amended Statement of Claim with the Ontario
Superior Court of Justice seeking $220 million in damages in its
lawsuit against WestJet Airlines and its former Vice President of
Strategic Planning, Mark Hill.

WestJet and certain executives were involved in corporate
espionage on a massive scale against Air Canada.  Mark Hill has
admitted that WestJet surreptitiously accessed an internal
employee Web site nearly a quarter of a million times over a 12-
month period, and created automated technology to download and
analyze passenger load and booking information.

As a result, WestJet acquired a competitive advantage by obtaining
access to the number of passengers booked on any flight on any
route Air Canada flies anywhere in the world, for up to a year
into the future.  To its advantage and to Air Canada's detriment,
WestJet then used Air Canada's confidential information to compile
computer-generated reports for use in strategic planning, routing
and pricing decisions, with a high degree of accuracy and very
little risk.

Air Canada's $220 million claim includes $170 million in
compensation, $25 million in punitive damages and $25 million for
WestJet's intentional destruction of documents when it learned
Air Canada had discovered the espionage.

            Court Allows WestJet to File Counterclaim

WestJet received leave of the court to counter-claim against Air
Canada, Zip and their private investigators for the unlawful
seizure of WestJet's confidential financial information.  Leave
was required as Air Canada is currently under bankruptcy
protection.

WestJet's counter-claim against Air Canada, ZIP and their private
investigators is for the unlawful seizure of WestJet's
confidential financial information from Mark Hill's recycling
material at his home in Oak Bay, B.C.  Air Canada sent private
investigators to Hill's home on at least two occasions this
spring.  Hill states they trespassed on his private property to
unlawfully seize WestJet documents that had been shredded and
placed in a recycling container for pick up by municipal
employees.  Air Canada then hired a Houston, Texas firm to
reconstitute the shredded documents, which include WestJet's
confidential and sensitive business and financial information
unrelated to Air Canada's claim.  Air Canada's witnesses have
refused to disclose the full extent of their investigation and
what other documents they have seized.

The counter-claim states that the documents unlawfully obtained by
Air Canada and its private investigators include confidential
documents which in WestJet's opinion consist of financial
statements, fleet planning documents, capital budgets, variances
of actual against budget performance, and profit and loss
statements.  In its counter-claim WestJet will be seeking damages
and injunctive and other relief.

Air Canada also filed today an amended Statement of Claim in its
action against WestJet.  In its claim Air Canada now alleges
damages of $220 million.  WestJet believes, based on the results
of an internal investigation and the cross-examinations of
witnesses in these proceedings, that the amount claimed by Air
Canada is completely without merit.

In WestJet's view and the view of its expert witness, the
information on the Air Canada employee Web site is not
confidential.  In fact this information is available to the public
through many sources, including counting passengers and other
public Web sites.  In addition, WestJet states no information from
the Air Canada Web site was ever used by WestJet for any purpose,
and the loss of revenue, profits and goodwill Air Canada alleges
it has suffered arises not from any use of information on the Web
site, but from Air Canada's mismanagement of its business, its
decision to persist in selling seats on flights for less than
cost, its high-cost structure and the poor treatment of its
customers.

      WestJet continues to be suspect of the motivation of the
legal action; at a time when Air Canada is dealing with
significant challenges within its organization, it chooses to
focus attention on other matters in order to distract the public
away from its true issues at hand.  These actions are an attempt
by Air Canada to discredit all members of the WestJet team and to
distract the market.

      WestJet serves 24 Canadian cities and is publicly traded on
the Toronto Stock Exchange under the symbol WJA.

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. 42; Bankruptcy Creditors' Service, Inc., 215/945-7000)


AMERICAN PLUMBING: Court Confirms Reorganization Plan
-----------------------------------------------------
On July 27, 2004, the United States Bankruptcy Court for the
Western District of Texas confirmed American Plumbing and
Mechanical, Inc.'s plan of reorganization, paving the way for
AMPAM's emergence from chapter 11. The announcement represents
another major milestone in the restructuring process AMPAM and its
affiliates commenced on October 13, 2003. Since that time, AMPAM
has undertaken significant efforts to restructure its operations
to focus on its core operations. Robert Christianson, AMPAM's
chief executive officer, says, "Emerging from chapter 11 has been
an important goal for the company and is the capstone event in the
successful restructuring of our business activities. We will
emerge with a strong, revitalized balance sheet; the financing
required to move forward and the ability to focus our attention on
the needs of our customers. It has been a challenging process for
our employees, customers, vendors and stakeholders. We are excited
to announce our success and are very grateful to our customers and
employees for their loyalty, steadfast support, patience and
confidence, for without them, we are keenly aware that this
reorganization would not have been possible."

The reorganized AMPAM will consist of five (5) independent
operating subsidiaries comprising the operations of RCR Companies
with locations in Southern California, Sacramento, California and
Las Vegas, Nevada; LDI Mechanical, Inc. with locations in
California, Nevada, Colorado and Maryland; Christianson Air
Conditioning and Plumbing with locations in Austin, Dallas and San
Antonio, Texas; Parks Mechanical, Inc. based in Southern
California; and Power Plumbing, L.P. based in Houston Texas. Under
the terms of the approved plan, the senior secured lenders receive
the controlling interest in the capital stock and will transfer
the capital stock received by them to executive management of the
reorganized subsidiaries.

               About American Plumbing & Mechanical, Inc.

American Plumbing & Mechanical, Inc., with its subsidiaries, is
the largest company in the United States focused primarily on the
residential plumbing, heating ventilation and air conditioning
contracting services industry. The Company also provides
mechanical contracting services. AMPAM provides plumbing, HVAC and
mechanical installation services to single-family residential,
multifamily residential and commercial construction customers.
Additional information and press releases about AMPAM are
available on the Company's website at http://www.ampam.com/

                           *   *   *

As reported in the Troubled Company Reporter's June 22, 2004
edition, American Plumbing and Mechanical, Inc. (AMPAM) reached an
agreement for a consensual plan of reorganization allowing the
Company to promptly emerge from Chapter 11.

The agreement, announced in open court, was reached with AMPAM's  
senior lenders and the Official Committee of Unsecured Creditors.  

AMPAM and its affiliates filed their respective voluntary  
petitions under Chapter 11 in the Bankruptcy Court for the Western  
District of Texas, San Antonio Division, on October 13, 2003. The  
Honorable Leif M. Clark, United States Bankruptcy Judge, has reset  
the confirmation hearing for July 8, 2004.


ANC RENTAL: Reports Status of Avoidance Actions
-----------------------------------------------
Joseph Grey, Esq., at Stevens & Lee, in Wilmington, Delaware,
reports that ANC Rental Corporation and its debtor affiliates and
subsidiaries filed 1,071 avoidance actions prior to the statutory
deadline for avoidance actions.  Because of the time lag between
the filing of the complaints and the order of the United States
Bankruptcy Court for the District of Delaware authorizing counsel
to represent the Debtors in the avoidance actions, the last
summons were issued by the Clerk of the Court in March 2004.  As
of July 15, 2004, the Debtors believe that service has been
affected on all of the Defendants.

In 259 cases, service has been effected, an answer has not been
filed, and the Debtors have engaged in negotiations with the
Defendants.  The Debtors anticipate that these matters will be
resolved or the Defendants will be required to respond to the
Complaints by August 30, 2004.  A complete list of the 259 cases
is available at no charge at:

          http://bankrupt.com/misc/ANC_259cases.pdf

In 436 cases, service has been effected, no answer of responsive
motion has been filed, and the Debtors have not been in contact
with the Defendants.  The Debtors intend to seek default judgment
in all cases where the Defendants have neither responded to the
Complaint nor contacted the Debtors' counsel prior to July 20,
2004.  A complete list of the 436 cases is available for free at:

          http://bankrupt.com/misc/ANC_436cases.pdf

In 81 cases, the Debtors have reached settlement agreements with
the Defendants.  Pursuant to the Confirmation Order, settlements
reached after April 16, 2004 do not require Court approval.  The
Debtors intend to file stipulations or notices dismissing the 81
cases in the near future.  A complete list of the Settled Cases is
available for free at:

          http://bankrupt.com/misc/ANCsettledcases.pdf

In 183 cases, service of process has been effected and the
Defendants have responded to the Complaint.  A complete list of
the 183 cases is available for free at:

          http://bankrupt.com/misc/ANC_183cases.pdf

As of July 15, 2004, the Debtors report that 112 cases have been
closed as a result of having been settled or dismissed.  The
Debtors provided a list of 97 Closed Cases, that list is available
for free at:

          http://bankrupt.com/misc/ANCclosedcases.pdf

Mr. Grey relates that none of the Debtors' avoidance actions has
been scheduled for trial and no notices have been filed of the
selection of mediators because it is more cost effective to
attempt to resolve the claims amicably.  None of the cases are
ready for trial.

Headquartered in Fort Lauderdale, Florida, ANC Rental Corporation,
is the world's third-largest publicly traded car rental company.  
The Company filed for chapter 11 protection on November 13, 2001
(Bankr. Del. Case No. 01-11200). On April 15, 2004, Judge Walrath
confirmed the Debtors' 3rd amended Chapter 11 Liquidation Plan, in
accordance with Section 1129(a) and (b) of the Bankruptcy Code.

Following confirmation of ANC's Plan, Blank Rome, LLP, and Fried,
Frank, Harris, Shriver & Jacobson, LLP, withdrew as the Debtors'
counsel. Gazes & Associates, LLP, and Stevens & Lee, PC, serve as
substitute counsel to represent the debtors' post-confirmation
interests.  When the Company filed for protection from its
creditors, ANC listed $6,497,541,000 in assets and $5,953,612,000
in liabilities. (ANC Rental Bankruptcy News, Issue No. 57;
Bankruptcy Creditors' Service, Inc., 215/945-7000)


ANSCOTT INDUSTRIES: Replaces Madsen with Marcum & Kliegman
----------------------------------------------------------
Effective June 17, 2004, Madsen & Associates CPA's, Inc. was
dismissed as the independent auditor for Anscott Industries Inc.,
and Marcum & Kliegman was appointed as the new independent auditor
for the Company.

Madsen issued its Report of Independent Public Accountants related
to Anscott's financial statements for fiscal year ended March 31,
2003.  Madsen's audit report, dated May 25, 2004, indicates that
the Company does not have the necessary working capital to service
its debt and for its planned activity.  These factors, Madsen
says, raise substantial doubt about the Anscott's ability to
continue as a going concern.  

The Company's Board of Directors participated in and approved the
decision to change independent accountants.


ARLINGTON HOSPITALITY: Franchisees Acquire Ground Round Assets
--------------------------------------------------------------
The Independent Owners Cooperative, LLC successfully executed
their strategy to acquire a majority of the assets of The Ground
Round Inc. The assets acquired include 42 trademarks registered in
the United States and Canada, all of the franchise agreements and
leases related to franchised locations and franchise receivables.
Banknorth, N.A. provided the financing of the $4.85 million cash
purchase price, with the franchisees providing equity investment
in the Cooperative and additional consideration by waiving $42
million in claims against the bankrupt estate and related parties.

The Cooperative is organized by 58 franchisees abandoned by the
Ground Round when it closed its doors on February 13, 2004. On
February 19, 2004, the Ground Round was forced to file for
bankruptcy protection in Boston. Nixon Peabody LLP, through
franchise partner Craig Tractenberg and bankruptcy partner Rick
Pedone, represented groups of the franchisees and formed the
Cooperative initially to continue vendor relations during the
bankruptcy.

                   Realizing the Owners' Destiny

In the Spring of 2004, the Owners met in Philadelphia during the
bankruptcy proceedings to conduct diligence of potential bidders
for the franchise assets. During these meetings, attended by the
debtors' and creditors committee counsel, the franchisees realized
that they were the natural purchasers of the assets and began
shopping for bank financing and private equity to fund their
acquisition. Although one of the parties interviewed in
Philadelphia was the highest cash bidder at the bankruptcy
auction, offering to pay $6.5 million for the franchise assets,
the debtors agreed to sell to the Owners and the bankruptcy court
approved the sale. Owners who purchased their franchises from the
Ground Round in the past two years may still pursue their claims
against $30 million of Errors and Omissions insurance coverage.

The reinvigorated system will now move forward with 72 operating
restaurants in 19 states. The brands acquired include Tin Alley
Pub, Gold Fork, Tap n Grill and Berkshire Grill.

According to Jack Crawford who will be President and CEO of the
Cooperative, "The settlement which provided for the sale to the
franchisees avoided costly litigation and will allow the investing
owners to control their own system and move forward and own a
share of their franchisor". In this way the franchisees who serve
the customers will have direct control and ownership of the future
of the brands. The IOC will be one of the largest cooperatively
owned franchise organizations in the country. The bankruptcy
process and coming together of our group has made us realize our
great potential through the control of our own destiny. Our owners
are experienced, proven operators, who will now be both
franchisees and owners influencing the direction and operation of
our brands."

This transaction is extraordinary in several respects. The new
franchisor will be wholly owned by its existing franchise owners.
The Independent Owners' Cooperative is an entity that at closing
will be owned by approximately 58 of the current Ground Round
franchisees who have made equity investments. An additional seven
locations will be licensed by the IOC.

The new entity will be extraordinarily well poised for future
growth. First, the markets previously served by the now closed
corporate stores constitute a vacuum that the new company hopes to
fill through expansion. According to Mike Ludwig of Hadley
Massachusetts, President of the Franchise Council which led the
franchisees through the bankruptcy and the Chairman of the Board
of Managers of the purchaser: "This is a dream come true for all
of us to run our own system and have a vested interest and mutual
commitment to our future together. Going forward we expect
tremendous growth. On July 12, confident that the closing would
occur, our newest franchisee, Burt Benepal, opened a new location
in Richmond, California and we were there to support him."

In addition, as part of the transaction, current franchisees are
expected to purchase and reopen seven currently closed Ground
Round restaurants. These new locations will bring the system to 72
operating franchise restaurants and have development rights to
open more during the first year of operation.

                       About the Company

American Hospitality Concepts (AHC), which operates the Ground
Round Grill & Bar chain, filed for Chapter 11 bankruptcy and
closed most of its 58 company-owned locations in February 2004. A
pioneer in the casual-dining segment, Ground Round offers a
variety of American standards and ethnic specialties. Ground Round
was founded in 1969 as a division of Howard Johnson (now owned by
Cendant). Backed by Boston Ventures Management, AHC acquired the
chain in 1997. The Company operates and franchises Ground Round
locations in about 25 states and Ontario, Canada. In addition to
its flagship chain, it operates a handful of Tin Alley Grill and
Berkshire Grill units and manages the John Harvard's Brew House
chain. See http://www.groundround.com/


ATLAS AIR: Joint Reorganization Plan Declared Effective
-------------------------------------------------------
Atlas Air Worldwide Holdings, Inc. (Pink Sheets: AAWWV) and its
subsidiaries completed their financial restructuring Tuesday,
July 27, and emerged from Chapter 11 bankruptcy protection as
their Joint Plan of Reorganization became effective. AAWW, the
parent company of Atlas Air, Inc. and Polar Air Cargo, Inc.,
sought Chapter 11 protection in January of this year.

AAWW's comprehensive financial and operational restructuring
program has resulted in the discharge of more than $600 million of
pre-petition debt, enhanced profitability through a reduction in
operating costs and the elimination of capacity, and reduced
financial costs through the restructuring of aircraft-related debt
and lease obligations.

                         New Financing Pact

As part of its restructuring, AAWW also secured a commitment for
exit financing through Wachovia Bank, National Association, and
its subsidiary Congress Financial Corporation, that is intended to
provide the Company with $60 million in liquidity. In addition,
the Company has paid off and retired its debtor-in-possession
financing facility obtained from CIT Group and Ableco Finance LLC,
an affiliate of Cerberus Capital Management, L.P.

                       New Board of Directors

A new Board of Directors, selected as part of the reorganization
process, has succeeded the Company's previous Board.  The new
Board consists of the following members:

     * Robert F. Agnew;
     * Keith E. Butler;
     * Duncan H. Cocroft;
     * Eugene I. Davis;
     * Jeffrey H. Erickson;
     * James S. Gilmore, III;
     * Herbert J. Lanese;
     * Frederick M. McCorkle; and
     * Wake Smith.

"Our emergence is the culmination of a lot of hard work and begins
a new chapter for our airlines, with a renewed organizational
strength and focus for us," said Jeff Erickson, President and
Chief Executive Officer of AAWW.

"Our employees did an outstanding job of keeping the business
moving forward as our case progressed through the court at a very
rapid pace. I am extremely gratified by the fact that, unlike
every other airline that has filed for bankruptcy recently, the
Company was able to avoid any reductions in employee pay or
benefits during the period," he said. "Indeed, we hit every one of
our targets during our time in Chapter 11, and we did so without
interruption to the quality of service and reliability expected by
our customers."

Mr. Erickson added, "The continued inspired performance of our
people, combined with the steps we have taken to markedly reduce
our cost of doing business, leave the Company well positioned to
capitalize on the opportunities of an improving economy, as well
as to meet future economic challenges."

                    No Shareholder Recovery

Consistent with its Joint Plan of Reorganization confirmed by the
U.S. Bankruptcy Court on July 16, 2004, the Company's prior common
stock has been extinguished. New common stock is being issued
pursuant to the terms of the Plan.

                           About AAWW

Atlas Air Worldwide Holdings, Inc. -- http://www.atlasair.com/--   
is a worldwide all-cargo carriers that operate fleets of Boeing  
747 freighters. The Company filed for chapter 11 protection  
(Bankr. Fla. Case No. 04-10794) on January 30, 2004 before the  
Honorable Robert A. Mark. Jordi Guso, Esq. of Berger Singerman  
represents the debtor in its restructuring efforts.


BEAL FINANCIAL: S&P Withdraws BB- Ratings at Company Request
------------------------------------------------------------
Standard & Poor's Ratings Services has withdrawn its 'BB-' rating
on Beal Financial Corp.'s $500 million senior secured notes. "The
rating has been withdrawn because the company has decided not to
go to market at this time," said Standard & Poor's credit analyst
Robert B. Hoban, Jr. Concurrently, the 'BB-' long-term
counterparty credit rating on Beal Financial has been withdrawn at
the company's request.


BIOPHAGE PHARMA: Second Quarter 2004 Net Loss Narrows to $226,610
-----------------------------------------------------------------
Biophage Pharma Inc. (TSX:BUG.V), a Canadian biopharmaceutical
company reported its financial results and review of operating
highlights for the second quarter ended May 31, 2004.

"During the quarter, Biophage revisited its R&D Plan and decided
to focus its activities towards developing new advanced
therapeutic and diagnostic applications for phage products,"
commented Dr. Rosemonde Mandeville, Chief Executive Officer of
Biophage Pharma Inc., "Concurrently, Biophage is pursuing the
development of its first nanosensor prototype for the detection of
microbial pathogens in water and biological fluids," added Dr
Mandeville.

For the three months ended May 31, 2004, the Corporation recorded
a net loss of $226,610 ($0.01 per share) compared to a net loss of
$230,806 ($0.01 per share) for the three months ended
May 31, 2003.  The year-to-date net loss for the six months ended
May 31, 2004 was reduced to $499,763 ($0.02 per share) compared to
a net loss of $648,095 ($0.03 per share) in 2003, mainly due to a
general reduction of spending in order to maintain liquidities.

Revenues for the quarter ended May 31, 2004 decreased to $253,967
from $479,862 for the quarter ended May 31, 2003.  The revenues
were reduced since the beginning of the year due to fluctuation of
demands, timing and general market conditions or two main reasons;
lack of marketing efforts due to the need to decrease our burn
rate prior to obtaining additional financing and the impact of a
major beryllium client who decided to test its employees every 3
years instead of every 2 years.

Research and development costs amounted to $144,403 during the
second quarter, compared to $277,429 for the same period in 2003.
This decrease was attributable to the reduction of R&D spending
implemented in April 2003.  The research and development tax
credits were $34,000 as compared to $114,388 for the second
quarter of 2003.  During 2003, Biophage received an adjustment for
additional tax credits of $50,371 related to fiscal 2002.

Costs of contracts amounted to $166,707 for the second quarter of
2004 as compared to $207,908 for the same quarter of 2003,
resulting from a decrease in contract revenues. General and
administrative expenses for the quarter ended May 31, 2004 were
$182,854 compared to $262,080 for the same quarter in 2003,
reflecting the decision made by management to reduce corporate
burn rate.

As at May 31, 2004, Biophage had cash and cash equivalents and
temporary investments of $435,381, compared with $848,333 as at
November 30, 2003.  However, on June 1, 2004, Biophage received
its 2003 Quebec tax credit reimbursement for an amount of
$229,950.  During the first six months ended May 31, 2004, cash
flows used in operating activities averaged $77,668 per month, as
compared to $84,853 in the same period of 2003. Biophage is
pursuing its efforts to obtain additional financing to fund its
R&D programs as well as minimizing its overhead expenses.  The
interim financial statements include a going concern assumption
note.

The Corporation has not realized a profit since its inception and
there can be no assurance that it will either achieve or maintain
profitability in the future.  

The Company reports that it will require additional financing to
fund its continuing operations and expected growth.  No assurance
can be given that such funding will be available.  The Corporation
plans to pursue its contract research and R&D activities.  These
activities are subject to the risks inherent in any Corporation
that operates in the field of biotechnology.  These risks relate
to continued revenue from contract research, the successful
completion of R&D activities and obtaining the required financing.
Since its incorporation, the activities of the Corporation have
been focused on acquiring and perfecting core technologies,
setting up a Contract Research Organization, pursuing several
research projects, the creation of a team of qualified scientific
and administrative personnel and financing its operations.  On
November 30, 2003, management of the Corporation was evaluating
different proposals to seek for new opportunities and additional
financing for its R&D programs.  The Corporation's ability to
continue as a going concern is dependent on its ability to raise
additional financing and achieving and maintaining profitable
operations.  The outcome of these matters cannot be predicted at
this time.  These consolidated financial statements do not include
any adjustments and classifications of assets and liabilities,
which might be necessary should the Corporation be unable to
continue its operations.

Biophage Pharma Inc. -- http://www.biophage.com-- is a Canadian  
biopharmaceutical company developing new therapeutic and
diagnostic products using phage-based technology.  Founded in
1995, Biophage is located at the Biotechnology Research Institute
in Montreal and employs 16 people, including a team of 13
researchers. Through an active research and development program,
as well as in-licensing and collaboration agreements, Biophage is
building a portfolio of promising new therapeutics.


CANDESCENT: Wants Meetin's Service as Patent Counsel to Continue
----------------------------------------------------------------
Candescent Technologies Corporation, and Candescent Technologies
International, Ltd., ask the U.S. Bankruptcy Court for the
Northern District of California, San Jose Division, for permission
to hire Ronald J. Meetin, Esq., as their special patent counsel to
provide continuing patent prosecution services with respect to the
Debtors' U.S. patents and patent applications.

The Debtors report that Skjerven Morril, LLP, where Mr. Meeting is
an attorney, served them as U.S. patent counsel since 1993.
Following Skjerven Morril's dissolution, the Debtors turned to
Wagner, Murabito & Hao, LLP for U.S. patent works.  Mr. Meetin's
employment was however continued with respect to certain patents
and patent applications because of his history with the Debtors
and thorough knowledge of the subject matter.

Mr. Meetin's limited services will include:

   a) prosecuting U.S. patent applications, including filing
      continuation and divisional U.S. patent applications;

   b) docketing and tracking due dates for U.S. patent
      applications; and

   c) otherwise advising or representing the Debtors with
      respect to certain U.S. patents or patent applications.

The Debtors assure the Court that they will monitor and manage the
distribution of patent prosecution work among their special patent
lawyers to avoid any unnecessary duplication of effort.

Mr. Meetin is holding a $20,000 prepetition retainer for costs and
services rendered or to be rendered in the Debtors' chapter 11
cases.  Mr. Meetin's current billing rate is $400 per hour.

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.


CATHOLIC CHURCH: U.S. Trustee Unable to Appoint Trade Committee
---------------------------------------------------------------
The Assistant United States Trustee for Region 18, Pamela J.
Griffith, reports that she was unable to appoint an Official
Committee of Unsecured Creditors in the Archdiocese of Portland in
Oregon's Chapter 11 case.

Ms. Griffith tells the United States Bankruptcy Court for the
District of Oregon that those creditors attending the
organizational meeting have were unwilling to serve on any
official committee.

Ms. Griffith may attempt to form one or committees in the future
if anybody indicates an interest.

The Archdiocese of Portland in Oregon filed for chapter 11
protection (Bankr. Ore. Case No. 04-37154) on July 6, 2004. Thomas
W. Stilley, Esq. and William N. Stiles, Esq. of Sussman Shank LLP
represent the debtor in its restructuring efforts. When the debtor
filed for chapter 11 protection, it listed estimated assets of
$10,000,000 to $50,000,000 and estimated debts of $25,000,000 to
$50,000,000. (Catholic Church Bankruptcy News, Issue No. 3;
Bankruptcy Creditors' Service, Inc., 215/945-7000)   


CYGENE LAB: Hires Eisner to Replace Brimmer, Burek & Keelan
-----------------------------------------------------------
On April 29, 2004, CyGene Laboratories, Inc., retained Eisner LLP
as its auditors to replace Brimmer, Burek & Keelan LLP and to
audit the books and accounts of the Company for the fiscal year
ending March 31, 2004.

Brimmer's report on the financial statements of the Company for
the two fiscal years ended March 31, 2003, expressed substantial
doubt about the Company's ability to continue as a going concern
because the Company has incurred recurring operating losses since
inception.


DB COMPANIES: Creditors Must File Claims by October 1, 2004
-----------------------------------------------------------
The United States Bankruptcy Court for the District of Delaware,
set 4:00 p.m. on October 1, 2004, as the deadline for all
creditors owed money by:

     * DB Companies, Inc.;
     * DB Motor Fuels, Inc.;
     * DB Marketing Company, Inc.;
     * DB Properties Management, Inc.; and
     * DB Transport, Inc.

on account of claims arising prior to June 2, 2004, to file formal
written proofs of claim.  Creditors must deliver their claim forms
to:

     If sent by regular mail:

         DB Companies Claims Processing
         c/o Bankruptcy Services, LLC
         PO Box 5269, FDR Station
         New York, New York 10150-5269

     If sent by courier or hand delivery:

         Bankruptcy Services, LLC
         Attn: DB Companies Claims Processing
         757 Third Avenue, Third Floor
         New York, New York 10017

Two categories of claims are exempted from the Bar Date:

     (a) claims listed in the Schedules of Assets and
         Liabilities; and

     (b) claims scheduled in the right amount and are not
         disputed, contingent or unliquidated.

The deadline for governmental units to file a proof of claim is
November 29, 2004.  All governmental unites with the authority to
conduct audits of the Company's books and records must complete
all audits before the Governmental Bar Date.

Headquartered in Pawtucket, Rhode Island, DB Companies, Inc. --
http://www.dbmarts.com/-- operates and franchises a regional  
Chain of DB Mart convenience stores in Connecticut, Massachusetts,
Rhode Island, and the Hudson Valley region of New York.  The
Company filed for chapter 11 protection on
June 2, 2004 (Bankr. Del. Case No. 04-11618).  William E. Chipman,
Jr., Esq., at Greenberg Traurig, LLP represents the Debtors in
their restructuring efforts.  When the Company filed for
protection from their creditors, they listed estimated assets of
over $50 million and debts of approximately $65 million.


DEVON MOBILE: Liquidating Trustee Issues Second Quarter Report
--------------------------------------------------------------
Gerard A. Shapiro, Senior Vice President of Buccino & Associates,
Inc., as the Liquidating Trustee of Devon Mobile Communications,
LP, delivers to the U.S. Bankruptcy Court for the District of
Delaware a financial information report on the events occurring
during the period from March 27, to June 29, 2004.

         Status of the Closing of Pending Sale Agreements

A. Buffalo Lake Erie Wireless Systems Co., LLC, (BLEW)

    The BLEW transaction closed on December 24, 2003.  In
    connection with the closing, a $50,000 escrow fund was
    established to provide for replacement of stolen equipment at
    several sites.  In May 2004, as a result of two insurance
    settlements relating to the BLEW sites, BLEW received a
    distribution of their net loss from the escrow fund.
    Subsequently, the Devon Trustee received the remaining balance
    from the escrow fund and insurance proceeds totaling
    $40,000, which represented the total escrow funds less
    $10,000 for insurance deductibles.

B. Maine Licenses

    The sale of five remaining Maine licenses to Gary Curry closed
    on April 14, 2004.  The proceeds totaled $150,000,
    representing the agreed sales price.

C. Virginia License

    The sale of the Winchester, Virginia license to Virginia
    Cellular closed on April 15, 2004.  The proceeds, which
    totaled $42,727, represents the $275,000 agreed to sales price
    less the debt assumed by Virginia Cellular, including
    late penalties and other adjustments.  As a result of the
    Closing, the claim initially filed by the Federal
    Communications Commission against Devon has been fully
    satisfied.

    The Devon Trustee has completed the disposition of all
    previously held FCC licenses.

D. Equipment

    The Devon Trustee continues to market two undelivered
    cellular towers.

                       Adelphia Litigation

On June 18, 2004, the Devon Trustee filed a cause of action
against Adelphia Communications Corporation and its related
companies in the ACOM Debtors' bankruptcy proceedings before the
U.S. Bankruptcy Court for the Southern District of New York.  The
Devon Trustee sought damages relating to several different counts,
including preference, fraudulent conveyance, breach of partnership
agreement, and breach of services agreement.  A pre-trial hearing
has been set for August 3, 2004 in the New York
Bankruptcy Court.

                Distributions Pursuant to the Plan

On May 19, 2004, the Devon Trustee paid an administrative expense
claim for $16,250.  To date, payments of Administrative Expense
Claims total $7,458,124.  Additional Administrative Expense
Claims, if allowed, are not expected to exceed $175,000.

The FCC claim, Class 2 - Secured Claim of FCC, which was
previously estimated at $103 million, has been fully satisfied as
a result of the Virginia Cellular transaction and other
transactions disclosed in past reports.

                  Amounts Received and Collected

The Devon Trustee received $240,875 from these sources:

    -- $42,727 from the Maine transaction;

    -- $150,000 from the Virginia transaction;

    -- $40,000 from the funds relating to the BLEW transaction;

    -- $5,204 of interest earned on cash on deposit;

    -- $2,152,84 refund of various insurance premium and rental
       deposit refunds; and

    -- $790 of miscellaneous receipts.

                Fees and Expenses Paid or Incurred

The Devon Trustee made $461,388 in total payments:

    -- $233,476 for the Trustee's fees and expenses for work
       performed from March 14 to June 12, 2004;

    -- $204,567 for attorney's fees covering primarily the period
       from January through May 2004;

    -- $4,917 paid to the Claims Agent for the period from January
       through May 2004;

    -- $2,656 as disposition fee paid to the Trustee's investment
       banker with respect to the Maine and Virginia transactions;

    -- $1,095 paid to an accounting firm in connection with the
       Maine and Virginia transactions; and

    -- $3,676 primarily for settlements with various utilities for
       postpetition services and printing costs relating to
       certain past transactions.

                Liquidating Funding Amount Balances

As of the close of business on June 28, 2004, the Devon Trustee
held funds totaling $4,186,468 in three accounts at a major
commercial bank:

       Account                                          Balance
       -------                                          -------
       Money market account                          $4,118,720
       Checking account used for disbursements           57,089
       Account for distributions of Allowed Claims       10,660

Devon filed for Chapter 11 protection in Delaware on August 19,
2002 under case no. 02-12431.  Saul Ewing, LLP, is representing
the Debtor. Devon is 49% owned by Adelphia Communications
Corporation.  (Adelphia Bankruptcy News, Issue No. 64; Bankruptcy
Creditors' Service, Inc., 215/945-7000)  


DIAMETRICS MEDICAL: KPMG Declines Reappointment as Accountant
-------------------------------------------------------------
On June 9, 2004, KPMG LLP provided written notice to Diametrics
Medical Inc. that the Firm declines to stand for reappointment and
have resigned as auditors and principal accountants for the year
ended December 31, 2004.  KPMG informed the Company that the
client-auditor relationship would cease upon completion of the
auditor's review of the Company's consolidated financial
statements as of, and for, the three and six-month periods ended
June 30, 2004.  

KPMG's audit reports on the consolidated financial statements of
Diametrics Medical, Inc. as of, and for, the years ended December
31, 2003 and 2002, note that the Company has suffered from
recurring losses and negative cash flows, raising substantial
doubt about its ability to continue as a going concern.

Other than such qualification as to uncertainty as a going
concern, the audit reports of KPMG LLP did not contain any adverse
opinion or disclaimer of opinion, nor were they qualified or
modified as to audit scope or accounting principles.   

The Company has conducted initial interviews with potential
successors to KPMG LLP and expects to appoint new principal
accountants during the third quarter.  


ECU SILVER: Plans to Raise CDN$2-7 Mil. from Private Placement
--------------------------------------------------------------
ECU Silver Mining Inc. (TSX:ECU) is in the process of arranging a
private placement with arm's length subscribers for gross proceeds
of between CDN$2,000,000 and CDN$7,000,000.  The private placement
is intended to be for a minimum of 6,896,551 units and a maximum
of 24,137,931 units, at a price of CDN$0.29 per unit.  Each unit
will consist of one common share of ECU Silver and one-third (1/3)
of a common share purchase warrant.  Each whole common share
purchase warrant shall entitle the subscriber to acquire one (1)
common share of ECU Silver at a price of CDN$0.35 for a period of
two years following the completion of the private placement.

ECU Silver will file a private placement notice form with the TSX
Venture Exchange (the "TSX-V") within 30 days.  The issue price
was determined by ECU Silver in accordance with the minimum
pricing requirements of the TSX-V and of the Autorite des marches
financiers (Quebec).

The net proceeds of this offering will be applied to ECU Silver's
working capital.  A portion of the net proceeds of this offering
will be utilized for general corporate and administrative purposes
as well as minor modifications to its milling facility and the
balance of the net proceeds will allow ECU Silver to purchase a
royalty on its Mexican operations currently held by European
investors.

ECU Silver is engaged in gold and silver development and
exploration in Mexico.  The Company also has interests in mining
properties in Canada and has not yet determined whether those
properties contain economically recoverable ore reserves.  The
recoverability of amounts for mining properties and related
deferred exploration expenses, and the capacity to meet all its
commitments depend on the discovery of economically recoverable
reserves, the ability of the company to obtain necessary financing
to complete the development, and the future profitable production
or proceeds from the their disposition.

At March 31, 2004, the Company reported a CDN$10,898,850
stockholders' deficit, compared to a CDN$10,839,731 deficit at
December 31, 2003.


ENRON CORP: Asks Court to Allow $25M Replacement DIP Financing
--------------------------------------------------------------
On December 3, 2001, the Enron Corporation Debtors entered into a
Revolving Credit and Guaranty Agreement with JPMorgan Chase Bank
and Citicorp USA, Inc., as co-administrative agents, Citicorp as
the Paying Agent, JPMorgan as collateral agent, and the DIP
Lenders.  The DIP Financing has been amended twice to extend its
term through September 3, 2004, on a final basis.

Brian S. Rosen, Esq., at Weil, Gotshal & Manges, LLP, in New
York, relates that currently, about $21,000,000 in letters of
credit are outstanding pursuant to the Second Amended DIP Credit
Agreement.  Moreover, all letters of credit issued under the
Second Amended DIP Credit Agreement will expire on or before
August 23, 2004, and can be drawn as early as the middle of
August 2004.

According to Mr. Rosen, the letters of credit issued and
outstanding under the Second Amended DIP Credit Agreement must be
replaced to prevent events of default in the Debtors' contractual
agreements and the creation of substantial risks for the Debtors.

To obtain replacement financing on the best terms possible, the
Debtors made inquiries with various financial institutions with
the capacity and experience to provide the financing the Debtors
require.  After various inquiries and preliminary discussions, it
became clear that the Debtors would be unable to obtain the
necessary financing with a proposed lender on substantially better
terms by offering the proposed lender solely an administrative
expense claim or a junior claim.

The Debtors believe that Wachovia Bank National Association could
provide the Debtors with their required replacement financing on
substantially better terms than the Debtors' current financing
facility or any other proposed financing from alternative
institutions.  Consequently, the Debtors focused their efforts on
negotiating with Wachovia to issue letters of credit on a secured
basis to provide the Debtors' postpetition financing through a
replacement letter of credit facility.

               The Wachovia DIP Financing Documents

The Debtors engaged in good faith, arm's-length negotiation with
Wachovia to provide a replacement of postpetition financing to
them on the terms and subject to the conditions set forth in:

    (i) the form of the Application and Agreement for Irrevocable
        Standby Letter of Credit;

   (ii) the form of the Security Agreement; and

  (iii) the fee reimbursement letter.

The salient provisions of the DIP Financing Documents are:

A. Applicant

    Enron Corporation

B. Co-Applicants

    It is expected that letters of credit will be issued for the
    benefit of a direct or indirect subsidiary of Enron.  Each
    entity will be a Co-Applicant, jointly and severally liable
    with Enron for the reimbursement obligations in connection
    with the letter of credit issued to it.

C. LC Issuer

    Wachovia Bank, National Association

D. Availability

    Enron will submit a Replacement DIP Agreement and execute a
    Security Agreement to Wachovia for each letter of credit
    requested.  In any event, the aggregate face amount of all
    letters of credit under the DIP Financing Documents will not
    exceed $25,000,000.

E. Term

    One-year term, with extension upon Enron and Wachovia's
    agreement, without further Court approval.

F. Purpose

    The letters of credit will be used solely to support general
    administrative and operating expenses of Enron and its
    subsidiaries.

G. Collateral

    Enron or its subsidiaries will place cash or cash equivalents
    in an amount equal to 110% of the face amount of each letter
    of credit in a separate deposit account maintained at
    Wachovia's offices as cash collateral for its obligations
    under each letter of credit issued under the DIP Financing
    Documents.

H. Priority and Liens

    All obligations pursuant to the DIP Financing Documents will
    be superpriority administrative expense claims pursuant to
    Section 364(c)(1) of the Bankruptcy Code, having priority
    over all administrative expenses of the kind described in
    Sections 503(b) and 507(b) of the Bankruptcy Code, and will
    be secured by a perfected first-priority lien pursuant to
    Section 364(c)(2) on the Collateral.

I. Conditions Precedent

    It is a condition precedent to the effectiveness of each
    Replacement DIP Agreement and all related agreements,
    including the DIP Financing Documents, that the form of
    Replacement DIP Agreement, and all related agreements will be
    approved and the DIP Order entered by the Bankruptcy Court.

J. Commitment Fees

    There is no commitment fee.

K. Letter of Credit Fees

    With respect to each Letter of Credit, Enron will pay (i) to
    Bank, a fee calculated at rate per annum equal to 0.5% on
    the stated amount of each Letter of Credit and (ii) customary
    issuance, amendment and processing fees and expenses with
    respect to each Letter of Credit.

L. Other Provisions

    The DIP Financing Documents provide for certain claims
    against the Bank, waivers, exculpations, events of default
    and other provisions.

Mr. Rosen notes that pursuant to the DIP Financing Documents, the
liens granted to Wachovia are restricted solely to the cash
collateral deposited in respect of the replacement letters of
credit.  Moreover, while the letter of credit fee is calculated at
rate per annum equal to 0.5% on the stated amount of the letter of
credit, the Debtors are no longer obligated to pay any commitment
fees.  Since the Replacement DIP Agreement with Wachovia replaces
the Debtors' current financing facility, the Debtors are no longer
obligated to pay any extension fee with respect to the Second
Amended DIP Credit Agreement.

                         The Transition

The Debtors are coordinating with both the DIP Lenders and
Wachovia to ensure an effective transition from the existing
financing facility with the DIP Lenders to the proposed
replacement financing facility with Wachovia.  Mr. Rosen informs
Judge Gonzalez that prior to the satisfaction of the letter of
credit reimbursement and other obligations, and the termination of
commitments under the Second Amended DIP Credit Agreement, the
DIP Lenders will release any liens granted to them pursuant to the
Second Amended DIP Credit Agreement solely in respect of
$25,000,000 in cash necessary for the Debtors to provide the
Collateral to Wachovia pursuant to the DIP Financing Documents.
All other priorities and liens on collateral granted to the DIP
Lenders, and obligations the Debtors owed under the Second
Amended DIP Credit Agreement will remain in effect until
termination of the Second Amended DIP Credit Agreement.  Wachovia
will be granted priority and liens as the Debtors provided
pursuant to the DIP Financing Documents.  When the Existing DIP
Termination Date occurs, all remaining liens on the Debtors'
assets in favor of the DIP Lenders will be released.  In
connection with the continuing cash management services JPMorgan
provided, the Debtors will grant JPMorgan liens on certain cash,
which liens will not attach to the Wachovia Collateral.

The Debtors seek the permission of the United States Bankruptcy
Court for the Southern District of New York to enter into the DIP
Financing Documents with Wachovia to provide replacement
postpetition financing. (Enron Bankruptcy News, Issue No. 119;
Bankruptcy Creditors' Service, Inc., 215/945-7000)


ENRON CORP: Wants to Reimburse NuCoastal's $15 Mil. Expenses
------------------------------------------------------------
Enron Corporation, Enron Operations Services, LLC, and Enron
Transportation Services, LLC, ask the United States Bankruptcy
Court for the Southern District of New York to:

    (a) approve a stipulation among the Debtors, the Official
        Committee of Unsecured Creditors, and NuCoastal, LLC,
        regarding CrossCountry Energy, LLC;

    (b) authorize the Debtors to reimburse NuCoastal for
        documented out-of pocket expense of up to $15,000,000 in
        connection with the proposed sale of membership interests
        of CrossCountry; and

    (c) authorize the Debtors to enter into an agreement pursuant
        to which NuCoastal and certain related parties will
        release certain claims, obligations and liabilities
        relating to the sale of the Equity Interest.

To recall, NuCoastal was the stalking horse purchaser for the
Equity Interest under a Purchase Agreement.  Before the
CrossCountry Bidding Procedures were approved, the Committee
received a bid from CCE Holdings, LLC.  CCE's bid was
approximately $55,000,000 higher than NuCoastal's bid, and did not
require a break-up fee to be accepted as a stalking horse through
an auction period.

Martin A. Sosland, Esq., at Weil, Gotshal & Manges, LLP, in New
York, reports that the Committee and NuCoastal engaged in
discussions that resulted in the execution of the Stipulation on
June 24, 2004.  The key elements of the Stipulation are:

    (i) NuCoastal increased its bid by about $100,000,000;

   (ii) Releases of claims related to the sale of the Equity
        Interest; and

  (iii) Waiver of certain non-solicitation provisions in the
        NuCoastal Agreement.

If NuCoastal is not approved as the stalking horse bidder, the
Debtors and the Committee will use its best efforts to obtain the
Court's approval to reimburse, up to $15,000,000, NuCoastal's
documented out-of-pocket expenses.

Consequently, the Debtors and the Committee conducted a "mini-
auction" at which CCE increased its bid for the Equity Interest by
$90,000,000 or $44,000,000 more than NuCoastal's increased bid.  
Accordingly, a revised CCE Purchase Agreement was entered and the
Court declared CCE as the stalking horse bidder.

Mr. Sosland assures the Court that the NuCoastal Stipulation was
negotiated at arm's length and in good faith among the Debtors,
the Committee and NuCoastal.  Moreover, Mr. Sosland points out
that the Stipulation facilitated the sale of the Equity Interest
at an increased price that is far higher than the $15,000,000
expense reimbursement to NuCoastal.  Notwithstanding, if NuCoastal
becomes the ultimate successful bidder at the auction, it will
return the amount of the reimbursed Expenses under the terms of
the Stipulation.

If the Debtors are not permitted to enter into the Stipulation and
settle with NuCoastal, Mr. Sosland notes that future litigation is
possible, which would result in additional, unnecessary expense
for the Debtors and delay the sale of the Equity Interest. (Enron
Bankruptcy News, Issue No. 119; Bankruptcy Creditors' Service,
Inc., 215/945-7000)


EUROPA ONE: S&P Upgrades Class E Rating to BBB From BB
------------------------------------------------------
Standard & Poor's Ratings Services raised its credit ratings on
the class B, D, and E floating-rate amortizing credit-linked and
funding notes issued by Europa One Ltd. At the same time, the
ratings on the class A2, A3, M, and C notes were affirmed.
  
The reference pool has experienced no losses to date.
Replenishment of the pool is not allowed in this transaction, so
principal payments received in the pool are mirrored through a
sequential principal repayment on the notes. The notes were issued
on March 27, 2000, and will mature on Dec. 15, 2036.
  
The leverage, interest cover, and exposure to high-risk loans
statistics have all improved significantly since closing. The
higher credit protection and the improved quality of the reference
pool warrant an upgrade of the class B, D, and E notes.
  
This transaction involves a credit default swap structure, in
which principal payment to noteholders is linked to the
performance of a reference pool of commercial property loans
domiciled in The Netherlands, Germany, Austria, France, and Spain,
and secured by shopping centers, offices, industrial properties,
and hotels. The reference loans were originated by Rheinische
Hypothekenbank Aktiengesellschaft (Rheinhyp), which became
Eurohypo AG on Aug. 13, 2002. The loans are serviced by Eurohypo.
  
The collateral supporting the notes is provided by public sector
Pfandbriefe and unsecured MTNs from Eurohypo (A/Negative/A-1).
Consequently, the ratings on the classes are linked directly to
the rating on the collateral. Currently, Standard & Poor's has a
negative outlook on the unsecured debt of Eurohypo.
  
The transaction update report on Europa One Ltd. can be found on
RatingsDirect, Standard & Poor's Web-based credit analysis system,
at http://www.ratingsdirect.com/ Alternatively, call one of the  
following Standard & Poor's numbers: London Ratings Desk (44) 20-
7176-7400; London Press Office Hotline (44) 20-7176-3605; Paris
(33) 1-4420-6708; Frankfurt (49) 69-33-999-225; Stockholm (46) 8-
440-5916; or Moscow (7) 095-783-4017. Members of the media may
also contact the European Press Office via e-mail at
media_europe@standardandpoors.com
  
                     RATINGS LIST
                                        Rating
                     Class        To             From
  
Europa One Ltd.
EUR1.355 Billion Floating-Rate Amortizing Credit-Linked and
Funding Notes
  
                     Ratings Raised
                     B           AAA            AA
                     D           A              BBB
                     E           BBB            BB
  
                     Rating Affirmed
                     A2          AAA
                     A3          AAA
                     M           AAA
                     C           A


EXIDE TECH: Blackstone Asks for $9.3 Million Final Fees
-------------------------------------------------------
The Exide Technologies Debtors employed The Blackstone Group, LP,
to provide financial advisory services in connection with a
possible restructuring of certain of their liabilities.  
Blackstone also provided investment-banking services in connection
with a possible sale or disposition of the Debtors, their
subsidiaries, or any of their assets.

During the postpetition period, Blackstone professionals devoted
significant time and attention assisting the Debtors to implement
their restructuring.  Blackstone estimates that its professionals
expended 8,442 hours providing financial advisory services to the
Debtors.

Blackstone's financial services were performed primarily by:

         Professional           Position
         ------------           --------
         Arthur Newman          Senior Managing Director
         Pamela Zilly           Senior Managing Director
         Craig Powell           Managing Director
         Samuel Hirsch          Vice President
         James Warner           Associate
         David Rosen            Associate
         Zachary Viders         Analyst
         Brett Craig            Analyst
         Sophia Virani          Analyst
         Jeffrey Braveman       Analyst

Blackstone asks the United States Bankruptcy Court for the
District of Delaware to:

    (a) approve the allowance of and authorize the Debtors to pay
        $8,736,823, which represents:

        -- $706,667 monthly advisory fee,

        -- $8,000,000 Restructuring Fee, and

        -- $30,157 out-of-pocket expenses;

    (b) authorize and direct the Debtors to pay its advisory fees
        and out-of-pocket expenses, aggregating $563,271, in
        connection with its first to seventh interim fee
        applications that were not yet paid; and

    (c) deem all fees and out-of pocket expenses applied for as
        final:

        First Interim Application         $533,431
        Second Interim Application         626,288
        Third Interim Application          645,914
        Fourth Interim Application         647,833
        Fifth Interim Application          640,039
        Sixth Interim Application          617,202
        Seventh Interim Application        899,628
        Eighth Interim Application       8,736,823
                                        ----------
                                       $13,347,159
        Less: Payments Received         (4,047,064)
                                        ----------
        Total Amount Due                $9,300,095

Headquartered in Princeton, New Jersey, Exide Technologies is the
world-wide leading manufacturer and distributor of lead acid
batteries and other related electrical energy storage products.  
The Company filed for chapter 11 protection on April 14, 2002
(Bankr. Del. Case No. 02-11125). Matthew N. Kleiman, Esq., and
Kirk A. Kennedy, Esq., at Kirkland & Ellis, represent the Debtors
in their restructuring efforts.  On April 14, 2002, the Debtors
listed $2,073,238,000 in assets and $2,524,448,000 in debts.
(Exide Bankruptcy News, Issue No. 50; Bankruptcy Creditors'
Service, Inc., 215/945-7000)

  
FEDERAL-MOGUL: Appoints Robert Miller, Jr., as Interim CEO
----------------------------------------------------------
Federal-Mogul Corporation (OTC Bulletin Board: FDMLQ) has
appointed Robert S. (Steve) Miller, Jr., to serve as interim Chief
Executive Officer, pending the appointment of a new CEO.  Mr.
Miller is currently non-executive chairman of Federal-Mogul's
board of directors.

Mr. Miller replaces Charles G. (Chip) McClure, who resigned from
the Company.  Mr. McClure, 50, was named chief executive officer
and president of Federal-Mogul in July 2003 after serving two
years as president and chief operating officer.

Mr. Miller, 62, has been a member of Federal-Mogul's board since
1993 and served as non-executive chairman of the board from
January 11, 2001 to October 1, 2001.  Mr. Miller twice previously
served in a transitional role as chief executive officer of
Federal-Mogul in 1996, and again in 2000.  The board, when
electing Mr. Miller as non-executive chairman, referred to his
experience in leading a number of companies through the bankruptcy
process.  Mr. Miller's leadership and expertise in financial
restructuring will be an asset to Federal-Mogul as the Company
prepares to emerge from Chapter 11.

Most recently, Mr. Miller was chairman and chief executive officer
of Bethlehem Steel Corporation.  He currently serves on the board
of directors for UAL (United Airlines), Waste Management, Inc.,
Pope & Talbot, Inc., Symantec Corporation and RJ Reynolds Tobacco
Holdings.

Mr. Miller has more than 25 years of experience in the automotive
industry, beginning with Ford Motor Company where he served in
various financial management positions in the United States,
Mexico, Australia and Venezuela.  He was vice chairman of the
board of Chrysler Corporation and executive vice president and
chief financial officer of Chrysler from 1981 until 1992.

"I look forward to leading Federal-Mogul as we prepare to emerge
from Chapter 11," Mr. Miller said.  "We will maintain our focus on
improving our financial and operating performance while creating
value for our customers and strengthening our position as a
leading supplier to the global automotive industry."

Mr. McClure expressed mixed emotions about leaving the company he
has helped shepherd through the bankruptcy process.  "It is
unfortunate that I will not be with the Company as it prepares to
emerge from Chapter 11.  It is an exciting time in Federal-Mogul's
history and I wish it all the best," said Mr. McClure, who will
replace retiring Larry Yost as chairman, chief executive officer
and president of ArvinMeritor, Inc.

Headquartered in Southfield, Michigan, Federal-Mogul Corporation
-- http://www.federal-mogul.com/-- is one of the world's largest  
automotive parts companies with worldwide revenue of some $6
billion.  The Company filed for chapter 11 protection on Oct. 1,
2001 (Bankr. Del. Case No. 01-10582). Lawrence J. Nyhan, Esq.,
James F. Conlan, Esq., and Kevin T. Lantry, Esq., at Sidley Austin
Brown & Wood and Laura Davis Jones, Esq., at Pachulski, Stang,
Ziehl, Young, Jones & Weintraub, represent the Debtors in their
restructuring efforts.  When the Debtors filed for protection from
its creditors, they listed $10.15 billion in assets and $8.86
billion in liabilities. (Federal-Mogul Bankruptcy News, Issue No.
60; Bankruptcy Creditors' Service, Inc., 215/945-7000)


FINDEX.COM: Closes $1.75M Financing Agreement with Barron Partners
------------------------------------------------------------------
FindEx.com, Inc., (OTCBB: FIND) closed on a $1,750,000 equity
financing deal through a private placement with Barron Partners,
LP. Under the terms of transaction, Barron Partners LP purchased
21,875,000 restricted common shares at a price of $0.08 per share.  
As part of the financing, and subject to certain conditions,
Barron Partners LP is also entitled to receive two common stock
purchase warrants.  The first warrant would entitle the holder to
purchase up to 10,937,500 common shares at an initial price of
$0.18 per share and the second warrant would entitle the holder to
purchase up to 10,937,500 additional common shares at an initial
price of $0.60 per share.

Concurrently with the closing of the Barron Partners, LP,
transaction, FindEx concluded a settlement with Swartz Private
Equity, LLC, with which it had been involved in an ongoing dispute
for several years.  The terms of settlement are deemed favorable
by management and the company's board of directors.

Steven Malone, President of FindEx, stated, "We are pleased to
have completed this transaction with Barron Partners. Barron has a
track record of doing their homework on companies and only
investing in those that they believe have strong upside potential
and a solid plan for the future. We believe that their decision to
invest in FindEx is a strong endorsement of our business plan and
our market potential.  The proceeds from this first round of
financing has allowed us to resolve our long-standing dispute with
Swartz, and will allow the company to clean up its balance sheet
and accelerate its development and marketing plan to grow the
company."

                   About Barron Partners, LP

Barron Partners, LP, is a New York-based private investment
partnership that specializes in investing in micro-cap public
companies.

                     About FindEx.com, Inc.

FindEx is a developer, publisher, distributor and seller of off-
the-shelf consumer and organizational software products.  The
common thread among the Company's products is a customer
constituency that shares a devotion to or interest in Christianity
and faith-based "inspirational" values.  They are focused on
becoming the premier provider of Bible study and related faith-
based software products and content to the domestic and
international markets.  Their flagship product is QuickVerse(R).
QuickVerse(R) simplifies biblical research with powerful searching
that anyone can use to find information across multiple Bibles and
reference books.  QuickVerse(R) includes customizable options for
daily Bible reading, and devotional and in-depth Bible study.  One
of their PDA Editions, specifically made for the Pocket PC(R) or
Palm OS(R), enables users to take their studies with them anytime,
anywhere. For product information see: http://www.quickverse.com.

                           *     *     *

As reported in the Troubled Company Reporter, April 19, 2004
edition, the Company reported in their 2003 10K:

"We do not currently have adequate funds available to fund our
operations over the next twelve months. In order to maintain the
current level of operations, we will need to secure additional
funding sources to meet its operating expenses. Such funding
sources may include, but are not limited to, funding pursuant to
private placements of common or convertible equities, placement of
debt with banks, private or public investors, or other lending
institutions.

"Although there can be no assurance, we believe that through a
combination of outside sources of capital and revenues generated
from direct-to-consumer sales, we will have sufficient sources of
capital to meet our operating needs. However, any substantial
delays in receipt of or failure to obtain such capital and delays
in product releases will prevent us from operating as a going
concern, given our limited revenues and capital reserves."


FINOVA GROUP: Commerce Capital Presses $273,000 Damage Claim
------------------------------------------------------------
Pursuant to a Subordination and Standstill Agreement dated April
12, 1999, FINOVA Capital Corporation, as senior lender, provided a
$1,800,000 credit facility to Magnolia Studios, Inc., a high-end
commercial printer.  Commerce Capital, LP, signed the Loan
Agreement as a "subordinated lender."  Contemporaneously with the
signing of the Agreement, Magnolia Studios and Commerce Capital
entered into a Subordinated Loan Agreement, which allowed Magnolia
to loan $1,000,000 from Commerce Capital.

Beginning 1999, Magnolia began experiencing growth in its
business, which required it to relocate to a larger facility and
upgrade its printing equipment.  To expand its business, Magnolia
sought additional capital from FINOVA Capital and Commerce
Capital.

However, months after entering into the Subordinated Loan
Agreement, Magnolia began defaulting under the Loan.  Pete Frey, a
principal and owner of Magnolia, began liquidating Magnolia's
assets, which includes soliciting bids from potential buyers for
the Printing Equipment.  Mr. Frey conveyed the offers to purchase
the Equipment to FINOVA Capital, which never responded to the
offers despite repeated efforts to discuss the offers.  FINOVA
Capital's failure to respond to offers to purchase the Equipment,
prevented Magnolia from reducing its debt, thus, contributing to
its going out of business.

Months after the original purchase offers, FINOVA Capital sold the
Equipment at auction without providing Commerce Capital any
written or oral notice of the intended sale, as required under the
Subordinated Loan Agreement.  Commerce Capital learned of the
Equipment auction from Mr. Frey.  FINOVA Capital auctioned the
Equipment for considerably less than the amounts offered by the
previous bidders.  As a result, FINOVA Capital's failure to
respond to the offers to purchase and its subsequent sale of the
Equipment at auction forced Commerce Capital to incur monetary
damages totaling $273,000.

Commerce Capital filed claims for breach of contract, breach of
statutory and fiduciary duties, negligence, and other improper
conduct against FINOVA Capital.  L. Jason Cornell, Esq., at Fox
Rothschild, LLP, in Wilmington, Delaware, tells the Court that:

   (1) FINOVA Capital's actions caused damages to Commerce
       Capital totaling at least $711,000, and, could result in
       damages of up to the full amount of the debt owed by
       Magnolia to Commerce Capital, which was $1,285,625 as of
       the date FINOVA Capital filed for bankruptcy;

   (2) Commerce Capital is subrogated to Magnolia's rights with
       regard to any damages Magnolia suffered from FINOVA
       Capital's conduct; and

   (3) Commerce Capital is entitled to a declaratory judgment
       reflecting that FINOVA Capital's lien against any other
       collateral, including the assets of any of Magnolia's
       guarantor, is invalid or equitably subordinate to Commerce
       Capital's lien in any collateral.

FINOVA Capital disputed Commerce Capital's claims due to lack of
information.  FINOVA Capital also argued that it performed its
contractual obligations in the ordinary course of business.  
FINOVA Capital also denied any indebtedness to Commerce Capital
due to set-off and recoupment.

Commerce Capital insists that it has an allowed claim for FINOVA
Capital's breaches.  Mr. Cornell points out that FINOVA Capital's
failure to provide notice was a breach of the terms of the Loan
Agreement, resulting in a commercially unreasonable sale of the
Equipment.  Additionally, FINOVA Capital's failure to respond to
the original Equipment purchase offers, and its subsequent selling
of the Equipment at sub-market prices, prejudiced Commerce
Capital.

Commerce Capital asks the United States Bankruptcy Court for the
District of Delaware to:

   -- overrule FINOVA Capital's Objection to its Claim;

   -- allow its Claim for $273,300; and

   -- award it attorney's fees and costs. (Finova Bankruptcy News,
      Issue No. 49; Bankruptcy Creditors' Service, Inc., 215/945-
      7000)


FLEMING COMPANIES: Asks Court to Approve Bayfest, et al., Accord
----------------------------------------------------------------
Fleming Companies, Inc., and its debtor-affiliates ask the United
States Bankruptcy Court for the District of Delaware to approve
A settlement agreement with Supervalu, Inc., and other Settling
Parties -- Bayfest, Inc., Festmark, Inc., Markfest, Inc.,
Packfest, Inc., Titanfest, Inc., TS Fest, Inc., Skogen's
Foodliner, In., Corporation 90, In., and Burkyfest, Inc.

Christopher J. Lhulier, Esq., at Pachulski, Stand, Ziehl, Young,
Jones & Weintraub, PC, in Wilmington, Delaware, relates that
pursuant to the Asset Purchase Agreement dated July 7, 2003,
between C&S Acquisition, LLC, and the Debtors, C&S acquired the
Debtors' wholesale grocery distribution business and assumed
certain associated liabilities.

Pursuant to an Asset Exchange Agreement, dated as of September 6,
2003, C&S and Supervalu agree that Supervalu may acquire
substantially all of the Debtors' assets and properties relating
to the Massillon, Milwaukee and LaCrosse product supply centers
and certain assets and properties related to the Superior product
supply center.

The Settling Parties and the Debtors were party to seven
agreements:

    (i) a Facility Standby Agreement
   (ii) a Franchise Agreement
  (iii) a Sign Lease
   (iv) a Demand Note
    (v) a Security Agreement
   (vi) a Supply Agreement
  (vii) a Service Agreement

According to Mr. Lhulier, the Settling Parties owe the Debtors
$754,300 in accounts receivable for goods delivered and services
the Debtors rendered.  However, the Settling Parties also filed
claims against the Debtors for direct and consequential damages in
connection with the assignment of the Agreements -- Cure Claim
-- and objections to one or more of these matters:

    * the C&S Sale;

    * Supervalu's acquisition of the Business; and

    * the assumption and assignment of one or more of the
      Agreements, including objections related to:

      -- cure amounts;

      -- alleged non-curable breached of the Agreements by the
         Debtors;

      -- the interrelationship between one or more of the
         Agreements that may only be assumed and assigned in
         their entirety;

      -- adequate assurance of future performance under the
         Agreements; and

      -- assignability of the Agreements.

The parties agree to enter into a global settlement of all
outstanding amounts owing to the Debtors.  The primary terms of
the Settlement Agreement as they affect the Debtors are:

    (a) Supervalu and Fleming Companies agree that Supervalu's
        ratable portion of the FSA Accounts Receivable Limit will
        be reduced by $754,350 in full and complete settlement of
        the A/R Balance;

    (b) Fleming waives any right to payment of any outstanding
        balance of any accounts receivable by the Settling
        Parties, other than $754,350 and Fleming agrees that all
        of the Settling Parties' accounts receivable owed to
        Fleming is paid in full;

    (c) The Settling Parties waive all claims for amounts due
        under the Agreements, including the Cure Claim;

    (d) The Settling Parties waive and withdraw with prejudice
        all Objections filed;

    (e) The Settling Parties consent to the assumption and
        assignment to Supervalu, or any of its wholly owned
        subsidiaries or affiliates, of all of Fleming's interest
        in the Agreements; and

    (f) The Debtors and the Settling Parties will grant each
        other a general release from all claims or causes of
        action arising on or prior to the Court's approval of the
        Settlement Agreement.

Mr. Lhulier contends that Judge Walrath should approve the
Settlement Agreement because:

    * the FSA Accounts Receivable Compromise Limit will be
      reduced by 100% of the A/R Balance owed to the Debtors;

    * it avoids potential litigation in the future that would be
      costly and time-consuming; and

    * the Debtors believe that they are not relinquishing any
      bona fide claims.

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. 40; Bankruptcy Creditors'
Service, Inc., 215/945-7000)


FLINTKOTE: James McMonagle Nominated as Future Claimants' Rep.
--------------------------------------------------------------
The Flintkote Company wants the U.S. Bankruptcy Court for the
District of Delaware to appoint James J. McMonagle to serve as the
legal representative for future asbestos claimants.  The Debtor
tells the Bankruptcy Court that a as Futures Representative is
necessary to protect the rights of individuals who will assert
asbestos-related demands after a plan of reorganization built
around a Sec. 524(g) Trust is confirmed and takes effect.

Statistically speaking, the Debtor believes that future asbestos-
related claims represent the greatest portion of its total
asbestos-related liability.  Current claimants are represented by
the Official Committee of Asbestos Claimants appointed by the U.S.
Trustee.  

The Debtor points out that one of the key elements of any plan of
reorganization is to establish a trust and obtain a channeling
injunction that will direct all past, present and future
claimants, to a personal injury claims resolution trust for
liquidation and payment.  To properly establish that trust and
comply with the requirements imposed under 11 U.S.C. Sec. 524(g),
the interests of both current and future asbestos-relates
claimants must be assessed and accommodated.

Judge McMonagle is a nationally-recognized leader in the
resolution of asbestos-related bodily injury claims.  He has
extensive experience in representing future claimants and in
planning to resolve or administer future claims.

The Debtors indicate that the Futures Representative will probably
retain professionals.  Those engagements will require separate
Court approval.  The Debtors understand that Judge McMonagle will
require Liability Insurance costing $25,000 per year, and the
Debtors expect to pay that premium.  

Headquartered in San Francisco, California, The Flintkote Company
is engaged in the business of manufacturing, processing and
distributing building materials.  The Company filed for chapter 11
protection on April 30, 2004 (Bankr. Del. Case No. 04-11300).  
Attorneys at Sidley Austin Brown & Wood LLP serve as lead counsel
to the Company.  James E. O'Neill, Esq., Laura Davis Jones, Esq.,
and Sandra G. McLamb, Esq., at Pachulski, Stang, Ziehl, Young &
Jones serve as local counsel to the Debtor in its restructuring
efforts.  When the Company filed for protection from its
creditors, it listed both estimated debts and assets of more than
$100 million.


GIANT JR.: Kabani to Replace Weaver as Independent Accountants
--------------------------------------------------------------
On June 8, 2004, the Board of Directors of Giant Jr. Investments
Corp. dismissed Weaver and Tidwell, L.L.P. as the Company's
independent accountants and appointed the firm of Kabani &
Company, Inc., to serve as independent public accountants for the
Company for the fiscal year ended August 31, 2004.

Weaver and Tidwell's reports on the Company's consolidated
financial statements for the fiscal years ended August 31, 2003
and August 31, 2002 were modified to include an explanatory
paragraph expressing substantial doubt about the Company's ability
to continue as a going concern.


GLOBAL GOLD: Terminates Marcum & Kliegman as Certifying Accountant
------------------------------------------------------------------
On May 27, 2004, the Board of Directors of Global Gold Corporation
approved a resolution to terminate the services of the Company's
certifying accountant, Marcum & Kliegman LLP.  On the same day,
and prior to receiving notice of termination from the Company,
Marcum notified the Company of its resignation as certifying
accountant for the Company.

Marcum served as the Company's independent auditors since
May 1, 2003. Immediately prior to May 1, 2003, Grassi & Co. CPAs,
P.C. served as the Company's independent auditors.

Marcum's report on the Company's financial statements for the
fiscal year ended December 31, 2003, contained an explanatory
paragraph questioning the company's ability to continue as a going
concern.
                 

HOLLINGER INC: Appeals Delaware Chancery Court Ruling
-----------------------------------------------------
Hollinger Inc. (TSX:HLG.C) (TSX:HLG.PR.B) had filed an appeal of
the ruling issued yesterday by Delaware Chancery Court Vice
Chancellor Leo E. Strine regarding the sale of Hollinger
International's U.K. assets. The company also issued the following
statement:

"We regret Vice Chancellor Strine's decision not to uphold the
rights of Hollinger International's shareholders to evaluate the
proposed sale of the company's U.K. assets. Hollinger Inc.'s
independent directors, who manage and direct all litigation by and
against the company, have decided to pursue an appeal of the
ruling, and Hollinger Inc.'s legal counsel filed such an appeal
this evening.

"Regardless of the outcome of this litigation, Hollinger Inc.
looks forward to resuming its full rights as majority shareholder
of Hollinger International when the court-ordered injunction
terminates as anticipated, and will focus on maximizing the value
of the company's remaining assets for shareholders of both
Hollinger Inc. and Hollinger International.

"We also note that far from accepting Hollinger International's
contention that Lord Black and Hollinger Inc. had acted improperly
in discussing a bid for International's publicly held shares, Vice
Chancellor Strine recognized that Inc. 'remains free' to continue
such discussions."

As previously reported in the Troubled Company Reporter's July 20,
2004 edition, Hollinger International Inc. (NYSE: HLR) received
approximately $30.0 million from Conrad M. Black and Hollinger
Inc., representing amounts that Black and Hollinger Inc. had
agreed to repay under a Restructuring Proposal dated November 15,
2003, because they had not been properly authorized on behalf of
the Company. After they unsuccessfully challenged the repayment  
obligations, Black and Hollinger Inc. were ordered to pay these  
amounts by the Delaware Chancery Court on June 28, 2004. The Court  
ordered Black to pay $8,693,053.56, plus interest from June 1,  
2004; Black and Hollinger Inc. were held jointly liable to repay  
an additional $21,154,025.92 plus interest from June 1, 2004.  

The Court-ordered repayments represent amounts that were  
previously paid to Black and Hollinger Inc. were styled as "non-
competition payments" associated with the sale of U.S. community  
newspaper assets from 1999 to 2001. The payments had not been  
authorized or approved by either the Audit Committee or the full  
Board of Directors of the Company. Of the total of $32.15 million  
in unauthorized "non-competition" payments that were made by the  
Company during this period, $16.55 million was paid to Hollinger  
Inc., and approximately $7.2 million was paid to Black. The  
amounts received today include interest on these amounts from the  
original date of each of the unauthorized payments as provided for  
in the November Restructuring Proposal. Both Black and Hollinger  
Inc. have appealed this judgment.

Hollinger's principal asset is its approximately 68.0% voting and
18.2% equity interest in Hollinger International. Hollinger
International is a global newspaper publisher with English-
language newspapers in the United States, Great Britain and
Israel. Its assets include The Daily Telegraph, The Sunday
Telegraph and The Spectator and Apollo magazines in Great Britain,
the Chicago Sun-Times and a large number of community newspapers
in the Chicago area, The Jerusalem Post and The International
Jerusalem Post in Israel, a portfolio of new media investments and
a variety of other assets.

                           *     *     *

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.

       
INDEPENDENCE II: Fitch Cuts Preference Shares' Rating to CCC
------------------------------------------------------------
Fitch Ratings downgrades four classes of notes issued by
Independence II CDO Ltd. The rating actions effective immediately
are:

--$291,000,000 class A notes downgraded to 'AA+' from 'AAA';

--$78,000,000 class B notes downgraded to 'BBB+' from 'AA-';

--$14,571,491 class C notes downgraded to 'BB' from 'BBB';

--$16,700,000 preference shares downgraded to 'CCC' from 'BB-'.

Furthermore, the class A notes are removed from Rating Watch
Negative while the class B and C notes remain on Rating Watch
Negative as Fitch observes the performance of several securities
that may experience further deterioration.

The ratings of the class A and B notes address the likelihood that
investors will receive full and timely payments of interest, as
per the governing documents, as well as the stated balance of
principal by the legal final maturity date. The rating of the
class C note addresses the likelihood that investors will receive
ultimate and compensating interest payments, as per the governing
documents, as well as the stated balance of principal by the legal
final maturity date. The rating of the preference shares addresses
the likelihood that investors will receive ultimate and
compensating payments resulting in a dividend and return on the
preference share rated balance equivalent to 1%, as per the
governing documents, as well as the initial preference share rated
balance by the legal final maturity date.

Independence II is a collateralized debt obligation (CDO) managed
by Declaration Management & Research LLC that closed July 2001.
Independence II is composed of approximately 48.4% residential
mortgage-backed securities (RMBS), 14.3% asset-backed securities
(ABS), 32.1% commercial mortgage-backed securities (CMBS), 0.4%
real estate investment trusts (REITs), and 4.8% CDOs.
Since the rating affirmation in August 2003, the collateral
quality has deteriorated. Collateral in the manufactured housing
sector that has been downgraded to or below 'CCC+' since August
2003 equals $26.3 million (6.6%). Assets rated 'BB+' or lower
represented approximately 17.72% as of June 30, 2003 and increased
to 30.26% as of June 30, 2004. The class A/B overcollateralization
(OC) ratio and class C OC ratio have decreased from 106.6% and
102.5%, respectively, as of June 26, 2003 to 104.1% and 100.2% as
of June 30, 2004. The class A/B OC ratio continues to pass its
test level while the class C OC ratio is currently failing its
test level of 101.2%. The class A/B interest coverage (IC) ratio
is failing its test at 116.1% versus a test level of 118.5% while
the class C IC ratio is passing at 113.3% with a test level of
112.5%.

Fitch conducted cash flow modeling utilizing various default
timing and interest rate scenarios to measure the breakeven
default rates relative to the minimum cumulative default rates
required for the rated liabilities. (For more information on the
Fitch Vector Model, see 'Global Rating Criteria for Collateralised
Debt Obligations,' dated Aug. 1, 2003, available on the Fitch
Ratings web site at http://www.fitchratings.com/


INNOPHOS INC: S&P Assigns B+ Corporate Credit Rating
----------------------------------------------------
Standard & Poor's Ratings Services assigned its 'B+' corporate
credit rating to specialty chemical manufacturer Innophos Inc. The
outlook is stable.

At the same time, Standard & Poor's assigned its 'B+' bank loan
rating and its recovery rating of '4' to the company's proposed
$50 million revolving credit facility due 2009 and $220 million
amortizing term loan due 2010, based on preliminary terms and
conditions. The '4' recovery rating indicates that bank lenders
can expect a marginal (25%-50%) recovery of principal in the event
of a default. In addition, a 'B-' rating is assigned to $190
million of senior subordinated notes due 2014.

"Proceeds from the bank borrowings and notes issuance will be used
to help fund the acquisition of this specialty phosphates
operation from Rhodia S.A. (B/Stable/B) in a highly leveraged
transaction," said Standard & Poor's credit analyst Wesley E.
Chinn.

Innophos, which will be owned by Bain Capital, is based in
Cranbury, N.J. The ratings reflect a moderate sales base, a narrow
product line in a niche, mature market, some vulnerability to raw
material costs and to the cyclicality of general economic
conditions, and very aggressive debt leverage. Exposure to
potential demand reduction for phosphates in the U.S. detergent
market remains a concern given environmental concerns at the state
level, but the phase out of phosphates for home laundry detergents
sold in the U.S. is complete. Further demand reduction for the
auto-dishwasher market in the U.S., or the onset of unforeseen
environmental concerns in Mexico, both of which are key markets,
will remain longer-range variables, although these issues are not
expected to impact Innophos based on current information. These
negatives overshadow the company's solid position in the
production of specialty phosphates, stable volume growth, good
operating margins, and expected debt reduction over the
intermediate term.

Specialty phosphates are used in various food and beverage,
consumer products, pharmaceutical, and industrial applications to
improve the texture and taste of food, make cleaning easier in
toothpaste, increase the effectiveness of active ingredients in
tablets, and improve the cleaning characteristics of detergents.
Innophos has leading shares in all three major product segments of
the specialty phosphates industry: purified phosphoric acid (which
is used in part in the downstream production of phosphate
derivatives), specialty salts and acids, and technical grade
sodium tri-polyphosphate (STPP). Specialty salts and acids account
for well over half of Innophos' operating income.


INTERTAPE POLYMER: Subsidiary Completes $125 Million Debt Offering
------------------------------------------------------------------
Intertape Polymer Group Inc.'s (NYSE:ITP) (TSX:ITP) wholly-owned,
newly-formed finance subsidiary, Intertape Polymer US Inc.,
completed the offering of $125 million of senior subordinated
notes due 2014 to institutional investors in an offering exempt
from the registration requirements of the Securities Act of 1933.
The notes have been guaranteed on a senior subordinated basis by
Intertape Polymer Group Inc. and all of its subsidiaries.

Interest will accrue and be payable semi-annually in arrears on
February 1 and August 1 of each year, commencing on February 1,
2005 at an interest rate of 8-1/2% per annum.

A portion of the proceeds from the offering was used to repay an
existing credit facility. The remaining balance of the proceeds,
together with expected borrowings under a new $275 million senior
secured credit facility, will be used to redeem all three series
of existing senior secured notes, pay related make-whole premiums,
accrued interest and transaction fees, and for general working
capital purposes. The new senior secured credit facility is
expected to fund upon the redemption of the existing senior
secured notes.

The senior subordinated notes have been offered in the United
States only to qualified institutional buyers and outside the
United States pursuant to Regulation S under the Securities Act of
1933. The senior subordinated notes have not been registered under
the Securities Act of 1933 and may not be offered or sold in the
United States except pursuant to an effective registration
statement under the Securities Act of 1933 or in accordance with
an applicable exemption from the registration requirements of the
Securities Act of 1933. This press release shall not constitute an
offer to sell or a solicitation of an offer to buy such
securities. In addition, the senior subordinated notes have not
been offered or sold, directly or indirectly, in Canada or to or
for the benefit of any resident of Canada, except pursuant to
applicable exemptions from the registration and prospectus
requirements of applicable Canadian securities laws.


J.P. MORGAN CHASE: Fitch Upgrades Low B Ratings for 6 Classes
-------------------------------------------------------------
J.P. Morgan Chase Commercial Mortgage Securities Corp.'s
commercial mortgage pass-through certificates, series 2001-CIBC1,
are upgraded by Fitch Ratings as follows:

          --$43.1 million class B to 'AA+' from 'AA';
          --$40.6 million class C to 'A+' from 'A'.

The following classes are affirmed by Fitch:

          --$111.1 million class A-2 at 'AAA';
          --$607.0 million class A-3 at 'AAA';
          --Interest-only class X-1 at 'AAA';
          --Interest-only class X-2 at 'AAA';
          --$12.7 million class D at 'A-';
          --$25.4 million class E at 'BBB';
          --$14.0 million class F at 'BBB-';
          --$29.2 million class G at 'BB+';
          --$10.1 million class H at 'BB';
          --$7.6 million class J at 'BB-';
          --$12.7 million class K at 'B+';
          --$5.1 million class L at 'B';
          --$5.1 million class M at 'B-'.

The $19.7 million class NR certificates are not rated by Fitch.

The upgrades reflect the increased credit enhancement levels from
loan payoffs and amortization and the subordination levels of
deals with similar characteristics issued today. The transaction
has paid down 7% since issuance, to $943.4 million as of July
2004, from $1.02 billion at issuance.

GMAC Commercial Mortgage Corp., the master servicer, collected
year-end (YE) 2003 financials for 86% of the pool balance. Based
on the information provided, the resulting YE 2003 weighted
average debt service coverage ratio (DSCR) is 1.43 times (x)
compared to 1.45x at issuance for the same loans.

Fitch is concerned about the high percentage of loans of concern
in this pool as compared to other similar deals issued in 2001.
Currently, ten loans (5.6%) are in special servicing, including
nine delinquent loans (3.6%). The largest specially serviced loan
(1.8%) is secured by a multifamily property in Columbus, OH. The
property's cash flow has declined and the special servicer is
evaluating workout options. The second largest specially serviced
loan (0.65%) is secured by a hotel property in Orlando, FL. The
loan is 90+ days delinquent. A receiver has been appointed and the
special servicer is evaluating workout options. The next loan
(0.53%) is secured by an industrial property in Atlanta, GA and is
currently 90+ days delinquent. The borrower filed for bankruptcy
in June 2003. The property is 52% occupied and a receiver is in
place.

Losses are expected on the specially serviced loans. If
anticipated losses are higher than expected, Fitch may re-visit
the ratings of the below-investment grade classes. However, given
the increased credit enhancement as a result of the transaction's
paydown, the upgrades are warranted to classes B and C.


JEUNIQUE INTERNATIONAL: 4-Member Creditors Committee Appointed
--------------------------------------------------------------
The United States Trustee for Region 16 appointed four creditors
to serve on an Official Committee of Unsecured Creditors in
Jeunique International, Inc.'s Chapter 11 case:

      1. John Galazin
         2105 Coronado Street
         Idaho Falls, Idaho 83404
         Telephone: (208) 523-5171
         Facsimile: (208) 529-9732

      2. Frederick Land & Cattle LLP
         3509 Wingren
         Irving, Texas 75062
         Attn: J. Stanley Fredrick
         Telephone: (214) 477-4860
         Facsimile: (972) 471-7335

      3. Dale Kruckenberg
         880 Meadowpass Road
         Walnut California 91789
         Telephone: (909) 869-7890
         Facsimile: (909) 869-7890

      4. Mark S. Horoupian, Esq.
         SulmeyerKupetz
         333 South Hope Street
         Thirty-Fifth Floor
         Los Angeles, California 90071-1406
         Telephone: (213) 626-231 I
         Facsimile: (213) 629-4520

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

Headquartered in City of Industry, California, Jeunique
International Inc. -- http://www.jeunique.com/-- a direct selling  
company, filed for chapter 11 protection on June 1, 2004 (Bankr.
C.D. Calif. Case No. 04-22300).  Mark S. Horoupian, Esq., at
Sulmeyer Kupetz A P.C., represents the Debtor in its restructuring
efforts.  When the Company filed for protection from its
creditors, it listed estimated assets of over $10 million and
estimated debts of more than $50 million.


KMART CORP: Wants Late-Filed Multi-Million Claims Disallowed
------------------------------------------------------------
Reorganized Kmart Corporation has identified 235 proofs of claim
that were filed after the appropriate Bar Date.  Accordingly, the
Debtors ask the United States Bankruptcy Court for the Northern
District of Illinois to disallow and expunge the Late-Filed
Claims:

        Type of Claim                  Claim Amount
        -------------                  ------------
        Secured Claims                   $6,581,344
        Administrative Claims             2,946,098
        Priority Claims                  17,279,073
        Unsecured Claims                  2,547,284
        (Kmart Bankruptcy News, Issue No. 77; Bankruptcy
        Creditors' Service, Inc., 215/945-7000)


MACH ONE 2004: Fitch Assigns Lower B Ratings on 6 Classes
---------------------------------------------------------
MACH ONE 2004-1, LLC, series 2004-1, commercial mortgage-backed
securities pass-through certificates are rated by Fitch as
follows:

     --$100,000,000 class A-1 'AAA';
     --$152,000,000 class A-2 'AAA';
     --$146,822,000 class A-3 'AAA';
     --$643,262,435 class X* 'AAA';
     --$51,460,000 class B 'AA';
     --$10,453,000 class C 'AA-';
     --$28,142,000 class D 'A';
     --$7,236,000 class E 'A-';
     --$17,689,000 class F 'BBB+';
     --$15,277,000 class G 'BBB';
     --$14,473,000 class H 'BBB-';
     --$17,689,000 class J 'BB+';
     --$8,844,000 class K 'BB';
     --$8,040,000 class L 'BB-';
     --$8,844,000 class M 'B+';
     --$6,432,000 class N 'B';
     --$6,432,000 class O 'B-';
     --$6,432,000 class P-1 'NR';
     --$6,432,000 class P-2 'NR';
     --$6,432,000 class P-3 'NR';
     --$6,432,000 class P-4 'NR';
     --$6,432,000 class P-5 'NR';
     --$11,269,435 class P-6 'NR'.

          * Notional amount and interest only.

All classes are privately placed pursuant to rule 144A of the
Securities Act of 1933. The certificates represent beneficial
ownership interest in the trust, primary assets of which are all
or a portion of 60 classes of fixed-rate commercial mortgage-
backed securities having an aggregate principal balance of
approximately $643,262,435, as of the cutoff date.


LANTIS EYEWEAR: Has Until October 22 Decide on Unexpired Leases
---------------------------------------------------------------
By order of the U.S. Bankruptcy Court for the Southern District of
New York, Lantis Eyewear Corporation obtained an extension of its
lease decision period.  The Court gives the Debtor until
October 22, 2004, to decide whether to assume, assume and assign,
or reject its unexpired nonresidential real property leases and
executory contracts.

Headquartered in New York, New York, Lantis Eyewear Corporation --
http://lantiseyewear.com/-- is a leading designer, marketer and  
distributor of sunglasses, optical frames and related eyewear
accessories throughout the United States.  The Company filed for
chapter 11 protection on May 25, 2004 (Bankr. S.D.N.Y. Case No.
04-13589).  Jeffrey M. Sponder, Esq., at Riker, Danzig, Scherer,
Hyland & Perretti, LLP represents the Debtor in its restructuring
efforts.  When the Debtor filed for protection from its creditors,
it listed $39,052,000 in total assets and $132,072,000 in total
debts.


MCCANN INC: Involuntary Chapter 11 Case Summary
-----------------------------------------------
Alleged Debtors: McCann, Inc.
                 1212 Avenue of Americas
                 New York, New York

Involuntary Petition Date: June 25, 2004

Case Number: 04-12596

Chapter: 11

Court: Southern District of New York (Manhattan)

Judge: Stuart M. Bernstein

Petitioners' Counsel: Scott S. Markowitz, Esq.
                      Todtman, Nachamie, Spizz & Johns, P.C.
                      425 Park Avenue, 5th Floor
                      New York, NY 10022
                      Tel: 212-754-9400
                      Fax: 212-754-6262
         
Petitioners: ADCO Electrical Corporation T/A Scholes Electric &
             Communications
             1201 Centennial Avenue
             Piscataway, NJ 08854

             Hugh O'Kane Electric Co., Inc.
             3 Penn Plaza
             New York, New York 10004

             ADCO Electrical Corp.
             201 Edward Curry Avenue
             Staten Island, NY 10314
                                  
Aggregate Amount of Claims: $9,884,679


MCCANN: Lee Buchwald Appointed as Chapter 11 Trustee
----------------------------------------------------
The U.S. Bankruptcy Court for the Southern District of New York
approves the U.S. Trustee for Region 2's request to appoint Lee E.
Buchwald as Chapter 11 Trustee in McCann, Inc.'s liquidation.

The U.S. Trustee argued, successfully, that McCann's case needs a
Chapter 11 trustee due to "prepetition gross mismanagement, fraud
and dishonesty."

Deirdre A. Martini reports that the Debtor and its management have
engaged in gross mismanagement, which constitutes a crime of
larceny under New York law.

Ms. Martini, together with the unofficial unsecured creditors
committee, expresses no confidence in the current management's
ability to maximize the liquidation value of the Company's assets.

Ms. Martini and the committee have discovered that:

   (i) The Debtor's management collected up to $4,000,000 from the
       owner of certain construction projects weeks before
       ceasing operations and failed to pay those monies to the
       proper subcontractors;

  (ii) The Debtor's management may have falsified certain lien
       waivers and it is currently the subject of an
       investigation by the Manhattan District Attorney's office;

(iii) About one year before the involuntary petition was filed,
       the Debtor entered into an agreement and paid
       approximately $2,800,000 to satisfy the alleged debt of
       an affiliate.

The U.S. Trustee has consulted these core parties-in-interest
regarding the appointment of Mr. Buchwald, and each consents to
Mr. Buchwald's appointment:

   (a) Counsel for the Debtor
       Cliff Katz, Esq.
       Platzer, Swergold, Karlin, Levine, Goldberg & Jaslow,
         LLP;

   (b) Counsel for the Petitioning Creditors
       Scott Markowitz, Esq.
       Todtman, Nachamie, Spizz & Johns, P.C.; and

   (c) Counsel for Hugh O'Kane Electric, holder of large claim
       Ira Abel, Esq.
       Cohen Tauber Spievack & Wagner LLP.

Currently, the Debtor has ceased all operations.  The only Chapter
11 plan that's realistic will be a plan of liquidation.  Mr.
Buchwald will oversee the administration of the liquidation
proceeding.  

Headquartered in New York, New York, McCann, Inc., is a commercial
interior general contracting company. The Debtor's primary
shareholder is Bruce Fahey who owns 90% of the Debtor's common
stock.  In March 2004, The Company abruptly ceased all active
operations when one of its subcontractors complained about not
getting paid.  Currently, the Debtor and Mr. Fahey are the subject
of an investigation by the Manhattan D.A.'s office with regard to
forged lien waivers and violations of Article 3A of the New York
Lien Law.  On April 15, 2004, an involuntary Chapter 7 Petition
was filed by ADCO Electrical Corporation T/A Scholes Electric &
Communications, Hugh O'Kane Electric Co., Inc. and ADCO Electric
Corp., against the Debtor (Bankr. S.D.N.Y. Case No. 04-12596),
which was later converted to Chapter 11 of the Bankruptcy Code.  
The Petitioning Creditors claimed $9,884,679 due.  Clifford A.
Katz, Esq., at Goldberg & Jaslow, LLP serves as the Debtor's
counsel.


MIRANT CORP: Committee Wants to Discharge Huron Consulting
----------------------------------------------------------
The Official Committee of Unsecured Creditors of Mirant
Corporation, et al., asks the United States Bankruptcy Court for
the Northern District of Texas to discharge Huron Consulting
Group, LLC, from providing forensic services to it.

Monica S. Blacker, Esq., at Andrews & Kurth, LLP, in Dallas,
Texas, relates that beginning August 11, 2003, Huron provided
forensic services to the Mirant Committee, and continued until
June 17, 2004.  Beginning in May 2004, the Mirant Committee began
to gradually utilize PA Consulting Group, Inc., and Capstone
Corporate Recovery, LLC, to perform Huron's duties.  At present,
all matters Huron previously handled have been transferred to PA
and Capstone.

Since Huron is no longer providing services to the Mirant
Committee, Ms. Blacker contends that Huron should be given
authority to file its final fee application seeking payment of its
fees and expenses in full, through June 17, 2004, including any
holdbacks from prior applications.

Headquartered in Atlanta, Georgia, Mirant Corporation --
http://www.mirant.com/-- together with its direct and indirect  
subsidiaries, generate, sell and deliver electricity in North
America, the Philippines and the Caribbean.  The Company filed for
chapter 11 protection on July 14, 2003 (Bankr. N.D. Tex. 03-
46590).  Thomas E. Lauria, Esq., at White & Case LLP represent the
Debtors in their restructuring efforts.  When the Company filed
for protection from their creditors, they listed $20,574,000,000
in assets and $11,401,000,000 in debts. (Mirant Bankruptcy News,
Issue No. 39; Bankruptcy Creditors' Service, Inc., 215/945-7000)


MOHEGAN TRIBAL: Prices $200 Million Senior Debt Offering
--------------------------------------------------------
The Mohegan Tribal Gaming Authority announced the consideration to
be paid in the previously announced cash tender offer and consent
solicitation with respect to its $200,000,000 aggregate principal
amount of 8-1/8% Senior Notes due 2006 and its $150,000,000
aggregate principal amount of 8-3/8% Senior Subordinated Notes due
2011 and the successful completion of the consent solicitation
with respect to such Notes. The terms of the Offer are more fully
described in the Offer to Purchase and Consent Solicitation, dated
July 15, 2004.

The consideration was determined as of 2:00 p.m., New York City
Time, on Wednesday, July 28, 2004 by reference to a fixed spread
of 50 basis points above the yield to maturity of the 1.875% U.S.
Treasury Note due December 31, 2005, with respect to the Senior
Notes, and a fixed spread of 50 basis points above the yield to
maturity of the 2.75% U.S. Treasury Note due June 30, 2006, with
respect to the Subordinated Notes. The consideration for each
$1,000 principal amount of Senior Notes validly tendered and
accepted for payment is $1,070.68, which includes a consent
payment of $20.00 per $1,000 principal amount of Senior Notes
tendered with consents on or prior to the Consent Date (as defined
below). The consideration for each $1,000 principal amount of
Subordinated Notes validly tendered and accepted for payment is
$1,133.55, which includes a consent payment of $20.00 per $1,000
principal amount of Subordinated Notes tendered with consents on
or prior to the Consent Date. In each case, holders will receive
the accrued and unpaid interest on such tendered Notes, from the
last interest payment date to, but not including, the applicable
settlement date, payable on the applicable settlement date. The
settlement date for Notes tendered on or prior to the Consent Date
and accepted for payment by the Authority is expected to be
Tuesday, August 3, 2004.

The consent solicitation expired at 5:00 p.m., New York City Time,
on Wednesday, July 28, 2004. The tender offer expires at 12:00
midnight, New York City Time, on Wednesday, August 11, 2004. As of
the Consent Date, holders of the Senior Notes had tendered
$186,030,000 aggregate principal amount of such Senior Notes
(approximately 93% of the total issued and outstanding principal
amount) and delivered consents sufficient to amend (including the
change of control amendment) the indenture governing such Senior
Notes, as described in the Tender Offer Statement. As of the
Consent Date, holders of the Subordinated Notes had tendered
$133,655,000 aggregate principal amount of such Subordinated Notes
(approximately 89% of the total issued and outstanding principal
amount) and delivered consents sufficient to amend (including the
change of control amendment) the indenture governing such
Subordinated Notes, as described in the Tender Offer Statement.
The supplemental indentures incorporating these amendments have
been executed, and the amendments will become operative when the
tendered Notes, as applicable, are accepted for payment.

The Offer with respect to the Notes is subject to the satisfaction
of certain conditions, including financing on terms acceptable to
the Authority in an amount sufficient to consummate the Offer. The
terms of the Offer are described in the Authority's Tender Offer
Statement, copies of which may be obtained from Global Bondholder
Services Corporation, the information agent for the Offer.

The Authority has engaged Citigroup Global Markets Inc., Banc of
America Securities LLC and SG Americas Securities, LLC to act as
dealer managers and solicitation agents in connection with the
Offer. Questions regarding the Offer may be directed to Citigroup
Global Markets Inc., Liability Management Group at (800) 558-3745
(toll free) or (212) 723-6106 (collect), Banc of America
Securities LLC, High Yield Special Products at (888) 292-0070
(toll free) or (704) 388-4813 (collect), and SG Americas
Securities LLC, High Yield Capital Markets at (212) 278-5435
(collect). Requests for documentation may be directed to Global
Bondholder Services Corporation, the information agent for the
Offer, at (866) 857-2200 or, for banks and brokers, (212) 430-
3774.

This announcement is not an offer to purchase, a solicitation of
an offer to purchase or a solicitation of consent with respect to
any securities. The Offer is being made solely by the Offer to
Purchase and Consent Solicitation, dated July 15, 2004.

The Authority is an instrumentality of the Mohegan Tribe of
Indians of Connecticut, a federally recognized Indian tribe with
an approximately 405-acre reservation situated in southeastern
Connecticut, which has been granted the exclusive power to conduct
and regulate gaming activities on the existing reservation of the
Tribe located near Uncasville, Connecticut, including the
operation of the Mohegan Sun, a gaming and entertainment complex
that is situated on a 240-acre site on the Tribe's reservation.
The Tribe's gaming operation is one of only two legally authorized
gaming operations in New England offering traditional slot
machines and table games. Mohegan Sun currently operates in an
approximately 3.0 million square foot facility, which includes the
Casino of the Earth, Casino of the Sky, the Shops at Mohegan Sun,
a 10,000-seat Arena, a 300-seat Cabaret, meeting and convention
space and an approximately 1,200-room luxury hotel. More
information about Mohegan Sun and the Authority can be obtained by
visiting http://www.mohegansun.com/


NEW WORLD PASTA: Committee Hires Blank Rome as Local Counsel
------------------------------------------------------------
The Official Unsecured Creditors Committee appointed in New World
Pasta Company and its debtor-affiliates' cases asks the U.S.
Bankruptcy Court for the Middle District of Pennsylvania for
authority to hire Blank Rome LLP as its local counsel.  

The Committee tells the Court that it selected Blank Rome as its
co-counsel because of the firm's expertise and experience in
bankruptcy cases and, specifically, in representing creditors'
committee in chapter 11 cases.

As previously reported in the Troubled Company Reporter, the
Committee hired Fried, Frank, Harris, Shriver & Jacobson LLP as
its lead counsel.

The Committee expects that Blank Rome's services will include,
without limitation, assisting, advising and representing it with
respect to:

   a) the administration of these cases and the exercise of
      oversight with respect to the Debtors' affairs including
      all issues arising from or impacting the Debtors or the
      Committee in these Chapter 11 cases;

   b) the preparation on behalf of the Committee of all
      necessary applications, motions, orders, reports and other
      legal papers;

   c) appearances in Bankruptcy Court and at meetings of
      creditors to represent the interests of the Committee;

   d) the review, negotiation, formulation, drafting and
      confirmation of any plan(s) of reorganization and matters
      related thereto;

   e) the investigation of the assets, liabilities, financial
      condition and operating issues concerning the Debtors; and

   f) the performance of all of the Committee's duties and
      powers in conjunction with the Debtors' Chapter 11 cases.

Mark J. Packel, Esq., a partner in Blank Rome reports that the
firm's current professional billing rates range from:

         Designation         Billing Rate
         -----------         ------------
         Partners            $290 to $625 per hour
         Counsel             $255 to $600 per hour
         Associates          $185 to $370 per hour
         Paralegals          $105 to $240 per hour

Headquartered in Harrisburg, Pennsylvania, New World Pasta Company
-- http://www.nwpasta.com/-- is the leading dry pasta  
manufacturer in the United States.  The Company filed for chapter
11 protection on May 10, 2004 (Bankr. M.D. Pa. Case No. 04-02817).  
Eric L. Brossman, Esq., at Saul Ewing LLP represents the Debtors
in their restructuring efforts.  When the Company filed for
protection from its creditors, they listed both estimated debts
and assets of over $100 million.


NORTHWEST AIRLINES: S&P Lowers Rating to B & Says Outlook Negative
------------------------------------------------------------------
Standard & Poor's lowered its ratings on Northwest Airlines Corp.
and its Northwest Airlines Inc. subsidiary, including lowering the
corporate credit rating to 'B' from 'B+'. The 'B+' bank loan
rating was not lowered, and a recovery rating of '1' assigned,
reflecting strong collateral protection for that facility. Some
enhanced equipment trust certificates were lowered by more than
one notch, reflecting evaluation of collateral coverage and other
protections for individual securities.

"The downgrade of Northwest's corporate credit rating is due to
concerns that the airline's ongoing efforts to lower its labor
costs, while likely to achieve some savings, may nonetheless leave
it at a competitive labor cost disadvantage over the long term,"
said Standard & Poor's credit analyst Philip Baggaley. "In
addition, Northwest, like other U.S. airlines, is under pressure
from high fuel prices and rising price competition in the domestic
market, which have delayed and weakened an anticipated recovery in
earnings and cash flow," the credit analyst continued. The revised
ratings reflect a weak airline industry revenue environment,
substantial debt and pension obligations, and a need to lower its
relatively high labor costs. However, the airline's credit profile
benefits from substantial liquidity, with $2.9 billion of
unrestricted cash, and ongoing cost-cutting efforts. Northwest's
management is seeking to negotiate concessions from the airline's
labor groups, but faces a challenge in persuading unions to accept
needed cost-saving changes, given the company's ample near-term
liquidity. The pilot union is considered to be most receptive to
these proposals, and has already made an offer to cut
compensation, though not to the extent sought by management.

The $975 million credit facility available to Northwest Airlines
Corp. and Northwest Airlines Inc. is rated one notch higher than
the corporate credit rating. The recovery rating is '1',
indicating a high expectation of full recovery of principal in the
event of bankruptcy. The facility, which consists of a $725
million revolving credit facility due October 2005 and a $250
million 364-day revolving credit facility expiring October 2004
(renewable annually, but any amounts outstanding upon nonrenewal
would be due October 2005), is secured by Northwest Airlines
Inc.'s Pacific routes and certain aircraft. The routes, which
include valuable rights to serve restricted markets such as Japan
and China, and routes that are for cargo flying, should be
attractive to other U.S. airlines. Standard & Poor's discounted
the appraised values of these routes in its simulated default
scenario to replicate the conditions under which these routes
might be repossessed and sold. The credit facility is secured also
by certain aircraft, but their value is believed to be minimal.
Even after the discounts applied in a simulated default scenario,
amounts drawn under the credit facility should be repaid.

The long-term rating outlook is negative. Ratings could be lowered
if the company does not make significant progress in lowering its
high labor costs and renewing its $975 million of bank credit
facilities. Pressure on operating results due to industrywide
factors such as high fuel prices or renewed terrorist attacks
could also prompt a downgrade.


NRG ENERGY: Commodity Futures Trading Comm. Alleges Violations
--------------------------------------------------------------
The United States Commodity Futures Trading Commission alleges
that Debtor NRG Energy, Inc., engaged in acts and practices, which
violate the Commodity Exchange Act, as amended.

The Trading Commission is an independent federal regulatory agency
that is charged with responsibility of administering and enforcing
the provisions of the Act, and the regulations promulgated under
the Act.

Accordingly, pursuant to Section 6c of the Act, the Commission
asks the United States District Court for the District of
Minnesota to enjoin NRG Energy's acts and practices, and compel
NRG Energy's compliance with the provisions of the Act.

                     NRG's Natural Gas Trading

NRG Energy is a wholesale generator of power and is primarily
engaged in the ownership and operation of power generation
facilities, as well as trading and marketing of energy
commodities, including natural gas and power in the United States
and abroad.

NRG Energy traded natural gas for profit on electronic platforms
through brokers, and directly with counterparties.  Between August
2001 and May 2002, NRG Energy, through its power marketing group,
employed a number of traders who were responsible for buying and
selling natural gas both for use in running NRG Energy's
facilities and for speculative purposes.  NRG Energy divided its
traders into groups called desks.  Some of the desks corresponded
with NRG Energy's specific plants and with geographic regions of
the United States.

NRG Energy's natural gas traders were assigned to the Natural Gas
Desk.  The natural gas traders entered into transactions calling
for the physical delivery of gas.  They also entered into
financial trades, including futures and options contracts on the
New York Mercantile Exchange and other related instruments.
Traders on the Natural Gas Desk traded a variety of instruments,
including contracts involving fixed price natural gas and index-
based over-the-counter natural gas trades.

                   The Natural Gas Price Indexes

During the Relevant Period, price index compilers used price and
volume information collected from market participants like NRG
Energy to calculate indexes of natural gas prices for various hubs
throughout the United States.  The price index compilers include
Platts, a division of The McGraw-Hill Companies, which issues a
daily index for various natural gas hubs, titled Gas Daily.

Participants in the natural gas markets used indexes to price and
settle commodity transactions.  Natural gas price indexes like Gas
Daily were used by a variety of market participants in the spot
and over-the-counter derivatives market to price and settle their
natural gas deals.  Many consumers of natural gas, particularly
risk-averse end users like utilities, purchased natural gas at the
index price.  In addition, many natural gas contracts were priced
off of the published index prices.

Because market participants use Gas Daily in the natural gas spot,
over-the-counter derivatives, futures and options markets, the
information reported to Gas Daily by NRG Energy's traders is
market information that affects or tends to affect the price of
natural gas in interstate commerce, and could have affected or
tended to affect the natural gas futures and options contracts
traded on the New York Mercantile Exchange.

               Submission of False Trade Information

Anthony Mansfield, Esq., in Washington, D.C., relates that during
the Relevant Period, NRG Energy, through its employees and agents,
delivered reports concerning market information or conditions to
price index compilers by telephone, facsimile, and electronic
mail.

Gas Daily employees provided NRG Energy traders with specific
instruction concerning the kind of information to be reported,
requesting that NRG traders report prices and volumes of actual
physical next day trades or the high/low range of those trades
with a volume weighted average price.  Gas Daily employees
explicitly excluded the reporting of other trades, including
intraday trades.

NRG Energy, through its agents and employees, knowingly delivered
information concerning hundreds of natural gas trades to Gas
Daily.  Mr. Mansfield notes that many of those trades contained
false or misleading or knowingly inaccurate information.  Among
the false or misleading or knowingly inaccurate trades NRG Energy
delivered to Gas Daily were individual natural gas trades that NRG
Energy traders had not executed.  Also included were actual trades
entered into by NRG Energy, but with the prices of those
transactions altered or the volumes significantly inflated or
deflated, so that the trades potentially were weighed more heavily
by the publication in calculating the index.

Mr. Mansfield asserts that NRG Energy, through its employees and
agents, violated Section 9(a)(2) of the Act when it knowingly
delivered by telephone and the Internet reports to Gas Daily
containing false or misleading or knowingly inaccurate market
information, including entirely fictitious natural gas trades, and
natural gas trades with altered prices and volumes.  Mr. Mansfield
adds that submission of false, misleading, or knowingly inaccurate
reports concerning prices and volumes of natural gas trades to
publications like Gas Daily affected or tended to affect the price
of natural gas in interstate commerce.

                            NRG Responds

NRG noted that CFTC's lawsuit, which seeks only an injunction
against future violations of the Commodity Exchange Act, is not
necessary because the Company has complied and will continue to
comply with the law.  Furthermore, NRG no longer reports natural
gas trades to industry publications.

Any financial claims against NRG made by the CFTC will be handled
by the U.S. Bankruptcy Court in the Southern District of New York,
which has sole jurisdiction over the matter.  The Company believes
that it is inappropriate for the CFTC to pursue claims in any
other forum.

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. 31;
Bankruptcy Creditors' Service, Inc., 215/945-7000)


NUCOTEC INC: Reuben to Replace Stonefield Josephson as Auditors
---------------------------------------------------------------
Effective May 27, 2004, Nucotec, Inc., dismissed Stonefield
Josephson, Inc., which audited the Company's financial statements
for the fiscal years ended December 31, 2003 and 2002.  The
Company has hired Jonathon P. Reuben, CPA to act as its new
independent chartered accountants.  

Stonefield Josephson's reports for 2002 and 2003 were qualified
and expressed uncertainty as to Nucotec's ability to continue as a
going concern.

The Company's unaudited financial statements for the quarter ended
March 31, 2004, will be reviewed by Jonathon P. Reuben, CPA.  
Stonefield Josephson, Inc., was not involved in any way with the
review of the unaudited financial statements for the quarter ended
March 31, 2004.  The Company has authorized Stonefield Josephson,
Inc., to discuss any matter relating to Nucotec and its operations
with Jonathon P. Reuben, CPA.

The change in the Company's auditors was recommended and approved
by the Company's Board of Directors since Nucotec does not have an
audit committee.


OCUMED GROUP INC: Case Summary & 20 Largest Unsecured Creditors
---------------------------------------------------------------
Debtor: Ocumed Group, Inc.
        1255 Commerce Boulevard South
        Sarasota, Florida 34243

Bankruptcy Case No.: 04-15079

Type of Business: The Debtor produces and sells a broad range of
                  ophthalmic products for both the prescription
                  and over-the-counter pharmaceutical markets.

Chapter 11 Petition Date: July 27, 2004

Court: Middle District of Florida (Tampa)

Judge: K. Rodney May

Debtor's Counsel: Seth D. Levine, Esq.
                  Law Offices of Seth D. Levine
                  35 High Street
                  Newton, NJ 07860
                  Tel: 973-940-1616

Estimated Assets: $1 Million to $10 Million

Estimated Debts:  $1 Million to $10 Million

Debtor's 20 Largest Unsecured Creditors:

Entity                        Nature Of Claim       Claim Amount
------                        ---------------       ------------
Alfred R. Caggia              Director's loans          $650,000
71 Montvale Ave.
Montvale, NJ 07645

M. Taglish Bros, Inc.         Investment banking        $300,000
1370 Ave. of the Americas
New York, NY 10019

BKR International             Consulting                $185,608

Jason Togut Trust             Loan                      $100,000

SP Water Co.                  Joint venture loan        $100,000

Lawrence Morasco              Loan                       $50,000

Dr. L. Kaplan/Pharm. Qual.    Trade                      $28,000
Associates

Speed Packaging               Trade                      $21,275

National Health Care, Inc.    Trade                      $20,000

M. Kletter/Moldow Assoc.      Loan                       $15,500

F. Heigerd                    Legal work                 $17,500

Manatee County Utilities      Sewer                      $11,000

Eskimo Ple                    Trade                      $11,000

Katie Crawford                Worker's compensation       $6,075
                              Claim

Sobel & Co., LLC              Accounting                  $6,000

Ferrara & Speed               Legal work                  $5,821

M. Kaplan                     Loan                        $5,000

T.C. Pluciennik, Esq.         Legal work                  $4,500

Thomas Pluciennik             Legal work                  $4,500

United Welding Co.            Trade                         $850


OPTICAL SENSORS: Engages Virchow Krause to Replace Ernst & Young
----------------------------------------------------------------
On June 9, 2004, the Audit Committee of the Board of Directors of
Optical Sensors Incorporated dismissed Ernst & Young LLP as the
Company's independent accountants.   

Ernst & Young's reports on the Company's financial statements for
the years ended December 31, 2003, and December 31, 2002,
contained an explanatory paragraph expressing substantial doubt
about the Company's ability to continue as a going concern.   

The Company's Audit Committee recommended and approved the
decision to change independent accountants.  

On June 9, 2004, the Audit Committee of the Board of Directors of
the Company engaged Virchow, Krause & Company, LLP as its new
independent accountants.


OWENS CORNING: Former Judge Wolin to Join Advisor Gross's Law Firm
------------------------------------------------------------------
Alfred Wolin, the former judge sitting in the United States
District Court for the District of New Jersey who was directed by
the Third Circuit to step down from overseeing Owens Corning's
chapter 11 bankruptcy cases, has joined the law firm of Saiber
Schlesinger Satz & Goldstein, LLC, in Newark, New Jersey.  

Bloomberg News broke this news story.  

David R. Gross, Esq., one of the five District Court Advisors with
whom Judge Wolin met ex parte and causes the Third Circuit
discomfort, is a partner of the Newark law firm.  

Michael Pope, an Owens Corning unsecured creditor, is seeking
Mr. Gross' disqualification from the proceedings.

Bloomberg News relates that the law firms informed the Judge John
Fullam, who replaced Judge Woling, of Mr. Wolin's appointment.

"We want to insure that the court is aware of Judge Wolin's
prospective affiliation with our firm," Saiber Schlesinger
attorney Vincent Papalia wrote in a letter to Judge Fullam
obtained by Bloomberg News.


PAC-WEST: Settles Various Claims & Disputes with SBC California
---------------------------------------------------------------
Pac-West Telecomm, Inc. (Nasdaq: PACW), a provider of broadband
communications services to service providers and enterprise
customers in the western U.S., has entered into a Settlement
Agreement with SBC California providing for the resolution of
various claims and disputes.

On July 28, 2004, Pac-West entered into a Settlement Agreement
with SBC California regarding various disputes each party had with
the other party's invoices for charges billed in prior periods
through June 1st. Under the terms of the Settlement Agreement, SBC
California agreed to pay Pac-West $4.8 million.

                  About Pac-West Telecomm, Inc.

Founded in 1980 and first incorporated in 1981, Pac-West Telecomm,
Inc. has been offering telephone service to its customers since
1982. Pac-West is currently one of the largest competitive local
exchange carriers headquartered in California. Pac-West's network
averages over 120 million minutes of voice and data traffic per
day, and carries an estimated 20% of the dial-up Internet traffic
in California. In addition to California, Pac-West has operations
in Nevada, Washington, Arizona, and Oregon. For more information,
please visit Pac-West's website at http://www.pacwest.com/

                            *   *   *

In its Form 10-Q for the quarterly period ended March 31, 2004,
filed with the Securities and Exchange Commission, Pac-West
Telecomm, Inc. reports:

                Liquidity and Capital Resources

"Sources and use of cash. At March 31, 2004 cash and short term
investments decreased $2.7 million to $32.0 million from $34.7
million at December 31, 2003. The decrease was primarily due to
the payment of the semi-annual interest payments on our 13.5%
Senior Notes and the acquisition of the assets and certain of the
liabilities of Sentient.

"Cash requirements. The telecommunications service business is
capital intensive. Our operations have required substantial
capital investment for the design, acquisition, construction and
implementation of our network. With the recent advancements in
switch technology, we are currently investigating our options for
the deployment of our first next generation network switch, which
represents the latest technological improvements in switch
capacity and configuration, sometime during 2004. In April 2004,
we announced that we had selected Tekelec, a leading developer of
telecommunications products for next-generation fixed, mobile, and
packet networks, as our switching and signaling supplier. In
addition we completed a modem replacement program in the first
quarter of 2004, which we expect will provide us with increased
operational efficiencies. We continue to seek further ways to
enhance our infrastructure in 2004 and beyond. These projects and
our business plan, as currently contemplated, anticipates capital
expenditures, excluding acquisitions, of approximately $12 million
in 2004. However, the actual cost of capital expenditures during
2004 will depend on a variety of factors.

"Future uses and sources of cash. Our principal sources of funds
for 2004 are anticipated to be current cash and short-term
investment balances and cash flows from operating activities. We
may also obtain one or more lease or lines of credit in 2004.
However, there can be no assurance that we will obtain these
additional lines of credit or leases or that such lines of credit
or leases will be entered into at favorable interest rates. We
believe that our existing sources of funds will provide us with
sufficient liquidity and capital resources for us to fund our
business plan for the next 12 months. No assurance can be given,
however, that this will be the case."


PACIFIC GAS: Court Dismisses CPUC Appeal from Confirmation Order
---------------------------------------------------------------
The U.S. District Court for the Northern District of California
issued an order on July 15, 2004, dismissing an appeal filed by
two commissioners of the California Public Utilities Commission
from the order issued by the U.S. Bankruptcy Court for the
Northern District of California on December 22, 2003 confirming
Pacific Gas and Electric Company's reorganization plan.

Pacific Gas and Electric Company Vice President and Controller
Dinyar B. Mistry disclosed with the Securities and Exchange
Commission on July 16, 2004 that the District Court found that the
two commissioners lacked standing to appeal the Confirmation Order
because they failed to timely appear and object in the bankruptcy
proceeding, and they were not "persons aggrieved" by the
Confirmation Order.  The two commissioners had no financial
interest that was directly and adversely affected by the
Confirmation Order.

Accordingly, the District Court granted the requests to dismiss
the appeal, which were filed by the Utility, its parent, PG&E
Corporation, the Official Committee of Unsecured Creditors, and
the CPUC.

The City of Palo Alto's appeal of the confirmation order remains
pending.

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. 80; Bankruptcy
Creditors' Service, Inc., 215/945-7000)   


PARMALAT GROUP: Industry Minister Approves Restructuring Plan
-------------------------------------------------------------
The Minister for Production Activities in Italy, in agreement with
the Minister of Agriculture and Forestry Policy, gave his approval
on July 23, 2004, to Parmalat Group Restructuring Plan:

      * Minister's approval signals conclusion after seven months
        of the first phase of Parmalat's restructuring;

      * Decision triggers steps that will conclude in a vote of
        creditors on the proposed Composition with Creditors
        contained within the Restructuring Plan;

      * The Extraordinary Commissioner has made amendments to the
        Plan and to the proposed Composition with Creditors,
        taking into account comments by creditors and MPA, Rules
        governing Board of Directors of Assumptor;

      * Dividend policy connected to future proceeds from claw
        back and other legal actions established;

      * Committee to be established to advise Assumptor's Chief
        Executive on contentious issues arising out of the
        insolvency of companies subject to the proposed
        Composition with Creditors;

      * Threshold for allocation of warrants to creditors
        increased to cover the first 650 shares (previously the
        first 500 shares);

      * According to Delegated Judge's decisions and as soon as
        possible, the final Plan (approved by MPA) and the final
        proposed Composition with Creditors will be available to
        view on the Parmalat Web site http://www.parmalat.com
        section "Extr. Admin.", sub-section "Parmalat
        Restructuring Plan"

                (A) Approval by the Ministry of Production
                    Activities of Restructuring Plan and
                    proposed Composition with Creditors

The Minister of Production Activities ("MPA") Antonio
Marzano, in agreement with the Minister of Agriculture and
Forestry Policy Gianni Alemanno, has today approved on July 23,
2004 the Restructuring Plan for Parmalat, together with the
proposed Composition with Creditors filed by Extraordinary
Commissioner Dr. Enrico Bondi on 21 June 2004.

This clears the way, under the terms of Law 5/7/04 no. 166
for [these] steps to be taken:

      (1) Within three days, according Article 4-bis, comma 4, of
          the Law, the Restructuring Plan as approved by the MPA
          and the Agreement will be transmitted to the Court of
          Parma;

      (2) With procedures to be addressed by the Delegated Judge,
          Publication of extracts of the Extraordinary
          Commissioner's report on the causes of the Group's
          insolvency and attached the list of creditors indicating
          their respective claims and pre-emption rights and the
          Plan according to Article 4, commas 2 and 2-bis, of the
          Law;

      (3) Publication of the Agreement and the provision by which
          the Delegated Judge will establish the date by which
          creditors and any other interested party can communicate
          to the Court their comments on the List of Creditors;

      (4) During the 60 days following the end of the period [by
          which creditors and any other interested party can
          communicate their comments to the Court], the Delegated
          Judge, working with the Extraordinary Commissioner, will
          work to produce the definitive lists of accepted claims,
          claims accepted with reservation and excluded claims
          indicating the relevant quantum of such claims according
          to Article 4-bis, commas 6 to 9 of the Law as well as
          the setting of the final date for possible challenges to
          these lists according to Article 4-bis, comma 7, of the
          Law (respectively 15 and 30 days for creditors resident
          in Italy and outside Italy);

      (5) At the same time as the Lists are made available, the
          Delegated Judge will set the terms and the timing within
          the 60-day period under which accepted claims and claims
          accepted with reservation will be called to vote on the
          proposed Composition with Creditors.  He will also
          establish the criteria by which holders of financial
          instruments whose total value has been recognized for
          voting purposes will be eligible to vote; and

      (6) Announcement of the public availability of list of
          creditors and decree by Delegated Judge.

The Agreement will be approved if it receives a favorable
vote from creditors representing the majority of claims as
defined Article 4-bis, commas 8 and 9 of the Law.

                (B) Changes proposed by the MPA and applied
                    to the Plan and the Agreement

Also taking into account comments by creditors and MPA, the
Extraordinary Commissioner has made amendments to the Plan and to
the Agreement.  These relate to:

      (a) The Plan and the draft By-laws of the Assumptor have
          been modified in order to set in place temporary rules
          for the composition of the Assumptor's Board of
          Directors until such time as at least 50.1% of the
          shares representing the corporate share capital has been
          assigned to shareholders other than the Foundation
          Creditori Parmalat and in any case for no longer than 12
          months from the date of registration in the Companies'
          Register of the purchase of the entire corporate capital
          of the company by the Foundation Creditori Parmalat.
          More precisely:

             (i) until the first general shareholder meeting to
                 take place following the approval of the
                 Agreement, the Board of Directors should be
                 composed of three members, with the Chairman
                 having all the necessary powers to carry out all
                 the ordinary and extraordinary administration of
                 the business;

            (ii) from the point at which the general shareholder
                 meeting gives its approval until at least 50.1%
                 of the shares representing the share capital of
                 the Assumptor has been assigned to shareholders
                 other than the Foundation Creditori Parmalat, the
                 Board of Directors should be composed of at least
                 seven members of whom three should be
                 independent; and

           (iii) once the Foundation Creditori Parmalat has
                 distributed to creditors at least 50.1% of the
                 share capital of the Assumptor, the Board of
                 Directors of the Assumptor will automatically
                 resign and call a meeting of shareholders to name
                 a new Board of Directors according to the By-laws
                 of the company.  The relevant modification has
                 been made to Chapter VII of the Plan.

      (b) The Agreement has been modified in order to accommodate
          the distribution to shareholders of the Assumptor of 50%
          of distributable profits arising from the next 15 years'
          annual results of the Assumptor, including any eventual
          proceeds derived from revocatory actions or actions for
          damages (including out of court settlements).  The
          Agreement also foresees that in the case that the
          distributable profits for any single year represent less
          than 1% of the capital of the company, no distribution
          will take place but this sum will be brought forward to
          be distributed with the profits of future years once the
          percentage figure has been reached.

      (c) The Agreement has been revised to accommodate the
          commitment by the Assumptor to establish, within the
          Board of Directors of the Assumptor a Committee composed
          of a majority of independent directors to act in an
          advisory capacity to the Chief Executive Officer in
          relation to contentious issues arising from the
          insolvency of those companies that are subject to the
          Agreement (e.g. relating to revocatory actions, actions
          for damages, actions relating to personal liability).
          Meetings of this Committee will be attended by the Chief
          Counsel of the Assumptor.  The rules governing the
          Committee will provide that should any member of the
          Board of Directors of the Assumptor or of the Committee
          find himself in conflict of interest as a result of
          relations and/or connections with any person against
          which the Assumptor is making a claim, the Director
          and/or Member of the Committee in conflict of interest
          must abstain from voting on the relevant motions of the
          Board of Directors and/or of the Committee and not take
          part in any meetings where matters relating to any claim
          or action which give rise to the Directors and/or
          Committee Members conflict of interest are discussed.

      (d) The Plan and Agreement have been modified to accommodate
          the granting of a warrant for each share allocated to
          creditors covering the first 650 shares rather than the
          first 500 shares as previously proposed.  This change
          has been also made to Chapter VI of the Plan.

The rest of the Plan remains as already posted (in the non- final
version prior to the approval of the MPA) on the Parmalat website
on 14 July 2004.

According to Delegated Judge's decisions and as soon as possible
the Plan and the Agreement, including the modifications, in final
version as approved by the MPA will be available to view on the
Parmalat website.  It should be noted that in the final version of
the Plan a number of minor errors have been corrected and some
explanatory notes have been inserted in order to render the
document more accessible.

              Creditor Foundation Declared Legitimate

Parmalat Finanziaria SpA in Extraordinary Administration
communicates that the Prefecture of Parma has accorded by decree
judicial legitimacy to the Parmalat Creditor Foundation previously
established on July 21, 2004 by the companies of the Parmalat
Group in Extraordinary Administration subject to the proposed
Composition with Creditors.

This follows the approval of the Restructuring Plan by the
Minister of Production Activities in agreement with the Minister
of Agriculture and Forestry Policy.

On July 26, 2004 the Parmalat Creditor Foundation, also following
the approval of the Restructuring Plan, has acquired the entire
share capital of Parmalat SpA operating as the third party
Assumptor for the Composition with Creditors.

With [these] actions the necessary steps at the corporate level
have been completed prior to the filing of the Composition with
Creditors.

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. 25; Bankruptcy Creditors'
Service, Inc., 215/945-7000)   


PEGASUS SATELLITE: Hires PwC as Accountant & Auditor
----------------------------------------------------
Pegasus Satellite Communications, Inc., and its debtor-affiliates
ask the United States Bankruptcy Court for the District of Maine
for permission to employ PricewaterhouseCoopers, LLC, nunc pro
tunc to June 2, 2004, to provide accounting and auditing services
in their Chapter 11 cases.

Scott A. Blank, Pegasus Satellite Communications Senior Vice
President, Legal and Corporate Affairs, and General Counsel,
relates that PwC has served as the Debtors' outside accountant and
auditor since 1996.  Since then, PwC has developed a great deal of
institutional knowledge of the Debtors' business, finances,
operations, systems and capital structure.

PwC is a multi-national accounting firm that provides audit
services, accounting advice, financial consulting and advisory
services to over 80% of the companies on the Fortune 500 list.  
PwC has provided accounting and financial services to clients in a
variety of industries, including the cable and satellite
television industry.  Moreover, PwC has served as an accountant or
financial advisor to numerous debtors-in-possession and official
creditors' committees in various Chapter 11 proceedings.

As accountant and auditor, PwC will render these services to the
Debtors:

    (a) Sarbanes-Oxley Section 404 Advisory Services

        With respect the Debtors' efforts to assess and document
        their internal control environment in connection with
        Section 404 of The Sarbanes-Oxley Act of 2002, PwC will:

        -- develop an approach to address the requirements of
           Section 404 of the Sarbanes-Oxley Act;

        -- complete a high level Internal Control framework and
           prioritize processes for further review;

        -- evaluate and document key processes and controls
           Company wide;

        -- document the internal control structure, including all
           relevant policies, procedures and operating principles;

        -- ascertain key functional and enterprise risk areas;

        -- evaluate the Debtors' Corporate Governance programs
           including, Audit Committee, Internal Audit, Whistle-
           blower Programs, Fraud Programs, Code of Conduct and
           other corporate governance programs that exists;

        -- identify points of consideration for management to
           enhance controls and process efficiencies;

        -- evaluate the Debtors' resources and provide
           recommendations to continue a self-assessment of
           internal controls on an on-going basis; and

        -- render other related services as may be requested by
           the Debtors.

    (b) Audit Services

        PwC's audit services include the audit of the consolidated
        financial statements of the Company at December 31, 2003
        and December 31, 2004, and for the years then ending.  In
        conjunction with the annual audit, PwC will also:

        -- perform reviews of the Debtors' unaudited consolidated
           quarterly financial information for each of the first
           three quarters in the years ending December 31, 2004,
           and 2005, before the Form 10-Qs are filed;

        -- provide the Debtors special reports on compliance with
           aspects of contractual agreements that gives negative
           assurance relative to certain debt covenants based on
           the audits of the financial statements; and

        -- render other related services as may be requested by
           the Debtors.

    (c) Audit Consulting Services

        PwC's audit consulting services include audit-related
        consultations that extend beyond the scope of the annual
        audit services contained within the Fixed Fee audit scope.

Mr. Blank relates that PwC held a prepetition claim against the
Debtors for $23,300 but has agreed to waive that claim in its
entirety.  Accordingly, PwC is not a "creditor" of the Debtors
within meaning of Section 101(10) of the Bankruptcy Code.

The professional fee associated with the Audit Services is fixed
at $130,000 for reviews of the unaudited consolidated quarterly
financial statements for each of the first three quarters in the
year ending December 31, 2004.  The terms and fees for the audit
of the consolidated financial statements of the Company at
December 31, 2004, and for the year then ending have not been
finalized to date, and it is anticipated that these services will
begin in the Fall of 2004.  The total fees for the audit services
beginning in the Fall of 2004 are anticipated to be based on a
rate of $200 per hour, for total estimated fees of about $675,000
to $800,000.

The professional fees for the Sarbanes-Oxley Section 404 Advisory
Services, the Audit Consulting Services and all other accounting
and consulting services will be charged based on hourly rates for
each professional who performs them.  The total estimated fees for
the Sarbanes-Oxley Section 404 Advisory Services is between
$450,000 and $500,000, plus reasonable expenses.  Total estimate
for all other Audit Consulting Services and accounting and
consulting services, will be between $150,000 and $200,000, plus
reasonable expenses.  Current hourly rates, subject to periodic
adjustments, for PwC personnel are:

            Partners                      $762 - 1,454
            Managers/Directors             440 - 1,165
            Associates/Senior Associates   197 -   369

William H. Molloie, a partner at PwC, tells the Court that the
firm has no connection with the Debtors, their creditors, equity
security holders, and other parties-in-interest.  Mr. Molloie
assures Judge Haines that PwC is a "disinterested person" as that
term is defined in Section 101(14) of the Bankruptcy Code.



Headquartered in Bala Cynwyd, Pennsylvania, Pegasus Satellite
Communications, Inc. -- http://www.pgtv.com/-- is a leading  
independent provider of direct broadcast satellite (DBS)
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.
7; Bankruptcy Creditors' Service, Inc., 215/945-7000)    


PERSONA: Gets Final Regulatory Approval to Implement CCAA Plan
--------------------------------------------------------------
Persona Inc. (TSX: PSA) reports that the Canadian Radio-television
and Telecommunications Commission (CRTC) approved an application
relating to the change control of Persona Communications Inc.  
This approval represents the final of several regulatory approvals
required in order for Persona to proceed with a plan of
arrangement involving Persona and Canadian Cable Acquisition
Company Inc.  The original CRTC approval did contain several
condition precedents that the purchaser has now satisfied. Court
approval for the plan of arrangement was received from the Ontario
Superior Court of Justice on June 2, 2004.

The transaction, if consummated, will result in Canadian Cable
Acquisition Company Inc. acquiring all of the common shares of
Persona.  As well, if consummated, Mr. Philip Keeping will acquire
the shares of Persona Communications (Barbados) Inc. currently
owned by Persona.  Persona shareholders will receive $6.80 cash
for each common share held.  Persona option holders whose options
have an exercise price of less than $6.80 will receive the
difference between the exercise price and $6.80 for each option
held.

The Purchaser and the Company are now working in an effort to
close the transaction in accordance with the timeframes
contemplated in the Plan of Arrangement.  Persona's common shares
are expected to cease trading on The Toronto Stock Exchange at the
close of markets on the day following the closing. However, there
is no certainty the transaction will close.

                       About the Company

Persona is in the business of providing cable television, digital
cable, high speed Internet, dial-up Internet and telecom services
to a diverse base of residential and commercial customers in
British Columbia, Alberta, Saskatchewan, Manitoba, Ontario, Quebec
and Newfoundland.  Persona, as the largest and controlling
shareholder of Cable Bahamas Ltd., also provides similar as well
as more advanced services throughout the Commonwealth of The
Bahamas. Persona is a widely held public company whose shares
trade on The Toronto Stock Exchange (PSA).


PG&E NATIONAL: Wants Court Approval of Key Employee Retention Plan
------------------------------------------------------------------
Over the past several months, National Energy & Gas Transmission,
Inc., has made substantial progress in its Chapter 11 case,
including the confirmation of its reorganization plan and sale of
its gas transmission business.  NEG has also made considerable
headway with respect to the sale of its independent power producer
assets.  Significantly, NEG, its professionals and the Official
Committee of Unsecured Creditors have worked together to resolve
remaining issues and accomplish necessary tasks to consummate the
Plan.  While NEG is confident that the Plan will be consummated in
the near future, the exact timing remains uncertain as NEG pursues
the resolution of outstanding disputes and seeks to transfer
certain assets to maximize its remaining tax attributes.

According to Martin T. Fletcher, Esq., at Whiteford, Taylor &
Preston, LLP, in Baltimore, Maryland, the climate of uncertainty
has created unrest among key employees, who have expressed
concern, and in some instances, pursued employment opportunities
elsewhere.  The employee retention plan approved by the Court on
September 25, 2003 only runs through the effective date of the
Plan.  However, after the Effective Date, NEG and its subsidiaries
will continue to need employees to consummate the sales and wind
down business operations.  In addition, several employees critical
to the sales and wind down were not covered by the previous
retention plan.

NEG believes that the National Energy & Gas Transmission, Inc.
Phase II Retention Plan, which includes retention bonuses and
discretionary bonuses, is necessary to retain and motivate key
employees.  Without the employees, NEG would have extreme
difficulty accomplishing its crucial, post-effective date tasks
and the recovery to creditors would be harmed.

                        The Key Employees

NEG's Key Employees are employed by one of four service companies,
each of which is a non-debtor subsidiary of NEG:

    * Power Services Company
    * PG&E Gas Transmission Service Company, LLC
    * USG Services Company, LLC
    * NEGT Services Company, LLC

Mr. Fletcher states that Power Services employs personnel involved
in the operation of the independent power plants.  PG&E Gas
Transmission Service employs substantially all of the Key
Employees involved in NEG's gas transmission pipeline business.
USG Services employs the Key Employees that provide services to
USGen New England, Inc.  The Key Employees on the payroll of NEGT
Services consist of those working at NEG's corporate headquarters
who provide shared services functions for all subsidiaries and
services to the ET Debtors in connection with the wind-down of
their operations.  Each of Power Services, NEGT Services, USG
Services, and PG&E Gas Transmission Service administers and pays
the payroll for the Key Employees out of their own accounts and is
entitled to reimbursement or pre-funding of certain costs from
various affiliates.

                     The Existing Retention Plan

On September 25, 2003, the Court approved an amended retention
plan for key employees and authorized NEG and USGen to fund their
portions of the Existing Retention Plan.

According to Mr. Fletcher, the final payments under the Existing
Retention Plan are due to be made by the Service Companies within
10 days of the effective dates of the Chapter 11 Plans of NEG,
the ET Debtors, and USGen.  The costs remaining for Power
Services and NEGT Services under the Existing Retention Plan
total $860,000.

                       The New Retention Plan

To successfully operate before completing strategic sales and the
wind down of the NEG Debtors' business lines, NEG, in consultation
with its financial advisors and various of its affiliates,
developed a Phase II Retention Plan to retain and motivate the Key
Employees necessary for the efficient and expedient completion of
the wind down and sale of the NEG Debtors' businesses.

The objectives to be fulfilled by the implementation of the Phase
II Retention Plan are:

    (a) To enable NEG to retain and motivate the Key Employees
        critical to completing the tasks required to adequately
        wind down its businesses and to accomplish the successful
        sale or sales of assets and therefore maximize value for
        NEG's creditors;

    (b) To achieve flexibility for NEG with respect to both the
        duration of the Key Employees' retention and the amount of
        retention dollars given to specific individuals;

    (c) To supplement the Existing Retention Plan which served its
        intended goals, but is no longer adequate because of the
        longer time frame for completion of a successful
        reorganization; and

    (d) To reduce the attrition of employees, as nine key
        employees have resigned in May and June 2004.

Additionally, Mr. Fletcher notes that the Phase II Retention Plan
would provide for benefits based on a period that began June 1,
2004 and would cover the 165 Key Employees.  Based on NEG's wind
down forecast, the estimated cost of the Phase II Retention Plan
through December 31, 2004 is $2,920,000.

Furthermore, the Phase II Retention Plan contains two main
components:

    (a) Periodic Retention Bonuses

        Each of the Key Employees will be entitled to receive a
        bonus equal to a percentage of his base salary, for each
        of the four bonus periods:

        -- June 1, 2004 to August 31, 2004,
        -- September 1, 2004 to November 30, 2004,
        -- December 1, 2004 to February 28, 2005, and
        -- March 1, 2005 to May 31, 2005.

        However, a portion of each Periodic Retention Bonus will
        be deferred to ensure that Key Employees do not resign
        immediately following the conclusion of a bonus period.
        Specifically, Key Employees will receive either 30% or 40%
        of each Retention Bonus amount at the conclusion of the
        relevant bonus period -- depending on the group to which
        he has been designated -- while the remaining portion will
        be deferred until the Key Employees' employment is
        terminated because of death or disability or by NEG
        without Cause referred to as "Covered Termination".  After
        a Covered Termination, Key Employees will receive a pro-
        rata portion of the Periodic Retention Bonus for the
        period during which the Covered Termination occurs; and

    (b) Discretionary Bonus Pool

        In addition to the Periodic Retention Bonuses, certain
        Key Employees will be eligible for an additional payment,
        to be allocated by the Chief Executive Officer of NEG,
        provided that Key Employee is employed by NEG or an
        affiliate on the date that the additional payments are
        made, provided that in no event will the payments, in the
        aggregate, exceed $320,000.  Those payments will be made
        upon the completion of certain projects, as designated by
        the CEO.

NEG asks United States Bankruptcy Court for the District of
Maryland to approve the Phase II Retention Plan and to authorize
its implementation.

Headquartered in Bethesda, Maryland, PG&E National Energy Group,
Inc. -- http://www.pge.com/-- develops, builds, owns and operates  
electric generating and natural gas pipeline facilities and
provides energy trading, marketing and risk-management services.  
The Company filed for Chapter 11 protection on July 8, 2003
(Bankr. D. Md. Case No. 03-30459).  Matthew A. Feldman, Esq.,
Shelley C. Chapman, Esq., and Carollynn H.G. Callari, Esq., at
Willkie Farr & Gallagher represent the Debtors in their
restructuring efforts.  When the Company filed for protection from
its creditors, it listed $7,613,000,000 in assets and
$9,062,000,000 in debts. (PG&E National Bankruptcy News, Issue No.
25; Bankruptcy Creditors' Service, Inc., 215/945-7000)    


PRESTIGE BRANDS: S&P Puts Senior Debt Rating on Watch Negative
--------------------------------------------------------------
Standard & Poor's Ratings Services placed its 'B' corporate credit
rating on Prestige Brands Inc. on CreditWatch with negative
implications, as well as the company's 'B' senior secured debt
rating and its 'CCC+' senior subordinated debt rating.

The CreditWatch listing follows Prestige Brands' recent S-1 filing
with the SEC (filed under Prestige Brands Holdings Inc.) for an
initial public offering of income deposit securities (IDS)
representing shares of its common stock and new senior
subordinated notes. Standard & Poor's believes that the IDS
structure, in general, exhibits an extremely aggressive financial
policy.

Prestige had about $668 million of total debt as of March 31,
2004, (pro forma for the Bonita Bay Holdings Inc. acquisition).

As part of the IDS transaction, Prestige would purchase or redeem
all of its existing $210 million of senior subordinated notes due
2012, and amend or refinance its existing senior secured credit
facility. The transaction could also refinance existing preferred
and common stock at Prestige International Holdings LLC. Prestige
issued these senior subordinated notes in April 2004, plus a new
$505 million bank facility, in a deal that recapitalized the
company and funded the Bonita Bay Holdings acquisition.

"If the IDS transaction is completed, Prestige will have
significantly reduced its financial flexibility given the
anticipated high dividend payout rate," said Standard & Poor's
credit analyst Patrick Jeffrey. "As a result, the structure limits
the company's liquidity for managing operations and reduces the
likelihood for future deleveraging."

Another, lesser risk of the new structure is that the subordinated
debt portion of the securities may not be treated as debt for U.S.
federal income tax purposes. If all or a portion of the
subordinated notes are treated as equity rather than debt, the
interest on the subordinated notes will not be tax deductible by
the company. This could make the IDS securities uneconomic and
expose Prestige to refinancing risk.

Standard & Poor's will meet with management to discuss the
financial and business impact of the proposed offering and will
evaluate its effect on credit quality before resolving the
CreditWatch listing.

Irvington, N.Y.-based Prestige Brands Inc. is a leading consumer
products company with brands that include Compound W,
Chloraseptic, Murine, Comet, and Cutex.


RBX INDUSTRIES: Plans to Sell Groendyk Division to Magnifoam Tech
-----------------------------------------------------------------
Magnifoam Technology International, Inc.'s (MTI) newly formed
subsidiary, MTI Groendyk Inc., has signed a definitive agreement
with RBX Industries for the purchase of that company's Groendyk
Division. The Groendyk Division, based in Buchanan, Virginia,
manufactures a wide variety of industrial silicone products.

RBX Industries is currently in Chapter 11 proceedings.  All
divisions of RBX, profitable or not, are being sold or otherwise
disposed.  The United States Bankruptcy Court for the Western
District of Virginia has approved the proposed bidding procedures
for an auction of the Groendyk Division, scheduled for mid-August.  
While the definitive agreement gives MTI a favoured position in
the bidding process, the transaction is subject to normal due
diligence and the result of the auction, and the final sale is
subject to court approval.

Details regarding financing, transaction price and closing will be
released should the bid submitted by MTI Groendyk Inc. be
successful.

                        About Magnifoam

Magnifoam Technology International Inc. designs, develops and
manufactures custom-engineered products using silicone and other
cellular materials.  The Company has three main businesses:
Silicone, Aerospace and Fabricated Products.  MTI's manufacturing
divisions develop and produce silicone foam using patented
technology, and design and fabricate energy management systems
from a variety of flexible, cellular materials. Through its wholly
owned subsidiary Leewood Elastomer GmbH, MTI produces and
distributes specialty silicone elastomer products.  MTI sells its
products primarily in the aerospace and mass transit markets.
Secondary product categories include sporting goods, automotive,
industrial, medical and electronics markets. MTI's head office and
Canadian manufacturing operations are located in Mississauga,
Ontario, with international manufacturing operations located in
Richmond, Virginia and Bremen, Germany.  The Company also has
sales operations in England and Sweden, and an engineering support
centre in Brazil.

RBX Corporation, formerly known as RBX Group, Inc., is North
America's premiere manufacturer of closed cell foam and custom
mixed rubber compounds.  The company filed for chapter 11
protection (Bankr. W.D. Virginia Case No. 7-04-00725) on Feb. 24,
2004.  Lawyers at Hunton & Williams LLP represents the debtors in
their restructuring efforts.


RELIANCE GROUP: Committees Want 12 Multi-Million Claims Expunged
----------------------------------------------------------------
The Official Committee of Unsecured Creditors and the Official
Unsecured Bank Committee of the Chapter 11 cases of Reliance Group
Holdings, Inc., and its debtor-affiliates jointly object to Claim
Nos. 193 through 204 filed by the Pension Benefit Guaranty
Corporation.  The Committees ask the United States Bankruptcy
Court for the Southern District of New York to disallow and
expunge these Claims.

The PBGC filed three types of Claims against the Reliance Group
Holdings, Inc., Pension Plan and the Reliance Insurance Company
Retirement Plan, which the PBGC asserts jointly and severally
against both RGH and Reliance Financial Services Corporation.

                         RGH Plan Claims

Claim Nos. 193 and 194 were filed in unliquidated amounts for
unpaid minimum funding contributions owed to the RGH Pension Plan
as of the Plan termination date.  The PBGC asserts that an
unliquidated portion of the RGH Minimum Funding Claim is entitled
to priority pursuant to several Sections of the Bankruptcy Code.

Claim Nos. 195, 196, 197 and 198 were filed for a total of
$10,148,258.  The Claims were filed for unpaid PBGC premiums and
unfunded benefit liabilities based on the RGH Pension Plan.  The
PBGC states that unliquidated portions of the Claims are entitled
to priority based on Sections 503(b)(1) and 507(a)(1) of the
Bankruptcy Code.

                         RIC Plan Claims

Claim Nos. 199 and 200, estimated at $27,618,083, are for unpaid
minimum funding contributions owed to the RIC Retirement Plan as
of the Termination Date.  The PBGC asserts that the amount is
entitled to priority.

Claim Nos. 201, 202, 203 and 204, for an estimated total of
$124,492,127, are for unpaid PBGC premiums and unfunded benefit
liabilities of the RIC Retirement Plan.  The PBGC asserts that the
unliquidated portions of the Claims are entitled to priority.

              Duplicative and Wrong Priority Claims

The Creditors Committee's counsel, Arnold Gulkowitz, Esq., at
Orrick, Herrington & Sutcliffe, in New York City, tells the Court
that the RGH and RIC Minimum Funding Claims should be expunged as
duplicative of the RGH and RIC Unfunded Benefit Liability Claims.  
In addition, no portion of the RGH and RIC Unfunded Benefit
Liability Claims is entitled to priority under the Bankruptcy
Code.  The RGH and RIC Unfunded Benefit Liability Claims should be
reduced and allowed at amounts to be proven at the hearing.
Mr. Gulkowitz anticipates that the amounts allowed will be lower
than those asserted.

Mr. Gulkowitz alleges that the PBGC's Claims far exceed any
reasonable calculation of the actual benefit liability.  The PBGC
calculated the value of the liabilities of the Plans using
unrealistic actuarial assumptions that artificially inflated the
amounts of liability.  Furthermore, the PBGC failed to properly
credit recoveries that it made or should have made against debtor
and non-debtor entities.  The Claims are also based on incorrect
asset values of the Plans.  For example, many terminated employees
received their entire Plan benefits in the form of lump sum
distributions before the PBGC valued the Plan assets.  For these
employees, the PBGC calculated an excess amount of projected
benefits that were never earned, and failed to reduce liabilities
by the payments made.

Mr. Gulkowitz argues that the PBGC should not be allowed to
recover more than its actual costs.  The Claims should be limited
to the PBGC's economic exposure, which is far less than the
amounts asserted.  Otherwise, the PBGC will receive a windfall to
the detriment of RGH's and RFSC's other unsecured creditors.



Headquartered in New York, New York, Reliance Group Holdings, Inc.
-- http://www.rgh.com/-- is a holding company that owns 100% of  
Reliance Financial Services Corporation.  Reliance Financial, in
turn, owns 100% of Reliance Reliance Insurance Company.  The
Company filed for chapter 11 protection on June 12, 2001 (Bankr.
S.D.N.Y. Case No. 01-13403).  When the Company filed for
protection from their creditors,  they listed $12,598,054,000 in
assets and $12,877,472,000 in debts. (Reliance Bankruptcy News,
Issue No. 57; Bankruptcy Creditors' Service, Inc., 215/945-7000)    


SECURUS TECH: S&P Assigns B+ Corporate Credit & Sr. Debt Ratings
----------------------------------------------------------------
Standard & Poor's Ratings Services assigned its 'B+' corporate
credit rating to Dallas, Texas-based Securus Technologies Inc. At
the same time, Standard & Poor's assigned its 'B+' rating to
Securus' proposed $190 million senior unsecured notes issue, due
2012. The proceeds from the notes issue, along with approximately
$20 million in additional capital, will be used to purchase the
equity of Evercom Holdings Inc. and to refinance existing debt.
The outlook is positive.

"The ratings reflect Securus' narrow focus within a competitive
niche marketplace, aggressive financial profile, and potential
challenges with the integration of Evercom," said Standard &
Poor's credit analyst Ben Bubeck. These partially are offset by a
largely recurring revenue base supported by long-term customer
contracts and a diverse customer base, as well as expectations for
relatively stable operating margins and continued modest free
operating cash flow generation.

Securus is the largest independent provider of inmate
telecommunications services in the U.S. The company provides
services to correctional facilities operated by city, county,
state and federal authorities in the U.S. and Canada. Pro forma
for the proposed transaction, the company had approximately $198
million in operating lease-adjusted debt as of March 2004.

A fairly stable and visible cash flow base, supported by
intermediate-term customer contracts, limit Securus' downside
credit risk. The successful integration of Evercom, which should
lead to an improved financial profile, may result in a ratings
upgrade over the intermediate term.


SHEFFIELD: S&P Gives B- Secured Debt & Corporate Credit Ratings
---------------------------------------------------------------
Standard & Poor's Ratings Services assigned its 'B-' corporate
credit rating to Sand Springs, Okla.-based minimill steel producer
Sheffield Steel Corp. At the same time, Standard & Poor's assigned
its 'B-' senior secured debt rating to the company's proposed $80
million offering of senior secured notes due 2011, based on
preliminary terms and conditions. Proceeds from the notes will be
used to refinance existing debt. The outlook is stable. Total debt
outstanding pro forma for the refinancing will approximate $81
million.

"The ratings on Sheffield reflect its well-below-average business
position, characterized by exposure to highly cyclical steel
markets, volatile raw-material costs, limited geographic, product,
and operating diversity, comparably low utilization rates, and
capital-intensive operations," said Standard & Poor's credit
analyst Paul Vastola.

The ratings also reflect an aggressive financial profile that
includes postretirement benefit obligations and limited liquidity.
These negatives offset currently strong steel industry conditions
and the company's niche position in regional markets. Sheffield is
a minimill producer of concrete reinforcing bar (approximately 49%
of sales for fiscal year ended April 30, 2004), hot-rolled bar
products (33% of sales), and fabricated products (18% of sales),
including fabricated rebar, steel fence posts, and railroad track
spikes.

The 'B-' rating on the senior secured notes reflects their secured
position and the relatively small amount of priority liabilities
ahead of the notes in the capital structure. The notes are secured
by a first-priority lien on property, plant, and equipment and a
second-priority lien on accounts receivable and inventory. Ahead
of the notes is a proposed $15 million revolving credit facility--
secured by a first-priority perfected lien on all assets, except
property, plant, and equipment--operating leases, and some letters
of credit.

Sheffield is benefiting from improved conditions in the North
American steel industry, which have been strong in 2004, aided by
an improving U.S. economy and the global shortage of steel due
mainly to surging demand from China. Standard & Poor's expects
these favorable conditions to continue well into 2005. Sheffield
has significant operating exposure to steel scrap and energy
prices. However, Sheffield, like other steel companies, has been
able to improve profitability recently by offsetting spiking raw-
material costs with numerous selling price increases and
surcharges.


SPIEGEL: Eddie Bauer Wants to Sell Redmond Property for $38 Mill.
-----------------------------------------------------------------
Eddie Bauer, Inc., seeks the permission of the United States
Bankruptcy Court for the Southern District of New York to sell a
real property located at 15010 NE 36th Street, 3700 150th Avenue
Nebraska, and 15012 NE 38th Street, in Redmond, Washington, to
Microsoft Corporation for $38 million, pursuant to a purchase
agreement, and subject to higher and better bids.

                      The Eddie Bauer Property

Andrew V. Tenzer, Esq., at Shearman & Sterling, LLP, in New York,
tells the Court that Eddie Bauer's Redmond Property consists of
three office buildings occupying a total of 232,763 square feet,
situated on approximately 20 acres of land.  Eddie Bauer occupies
the entire Property, which it uses to house its entire
administrative and operational staff.  The Property is known as
the Eddie Bauer Corporate Campus.

                     The Stalking Horse Bidder

In connection with its ongoing review of business operations,
including its distribution facilities and its real estate assets,
Eddie Bauer determined that the Property is larger than what it
needs to service its current administrative and operational
business requirements.  The sale of the Property, in conjunction
with the proposed lease-back to Eddie Bauer for an initial term of
three years, with an option to terminate at no cost after two
years, will allow Eddie Bauer a flexible and efficient timeframe
in which to locate, lease and construct smaller, more cost-
effective alternative facilities, thus maximizing the Property's
value to Eddie Bauer.

On December 11, 2003, the Debtors entered into a listing agreement
with CB Richard Ellis, Inc., outlining the terms and conditions on
which they would retain CB Richard as their special real estate
consultant.  Pursuant to the Court-approved Listing Agreement, CB
Richard has the exclusive right to sell the property for a period
commencing November 1, 2003 and ending on the earlier of the
effective date of a reorganization plan or on October 31, 2004,
subject to extension or termination.  Under the Listing Agreement,
on the sale closing date, CB Richard is entitled to a sales
commission of $350,000 plus 6% of the gross sales price in excess
of $35,000,000, resulting in a $530,000 fee if no overbid is
received.

CB Richard began marketing the Property to potential buyers in
December 2003 and received five offers for it.  After extensive
consultation with its advisors, and consideration of the terms and
conditions of and risks associated with each offer, Eddie Bauer
determined that Microsoft's $38,000,000 offer for the Property was
the highest and best offer available, and agreed to accept
Microsoft's offer subject to the conduct of an auction soliciting
higher and better offers.

Mr. Tenzer relates that negotiations with Microsoft began in
January 2004 and continued until immediately before July 2004,
with Microsoft being fully advised that Eddie Bauer had filed a
Chapter 11 case, that the Court's approval of the sale would be
required, and that the sale would be subject to overbid pursuant
to bidding procedures to be agreed to by the parties and approved
by the Court.

                       The Purchase Agreement

On July 8, 2004, Eddie Bauer and Microsoft entered into the
Purchase Agreement.  Microsoft has already made a $1,000,000
initial deposit with First American Title Insurance Company, the
escrowee for the transaction.  The remainder of the Purchase Price
will be paid by Microsoft at the closing, unless a higher bidder
prevails at the Auction.

The significant terms of the Purchase Agreement are:

    (a) Purchase Price

        The purchase price for the Property is $38,000,000,
        payable by Microsoft in:

        * $1,000,000, within three business days after the
          parties' execution and delivery of the Purchase
          Agreement, to First American, by wire transfer of
          immediately available funds to First American's Account
          No. 2350006160 at Union Bank of California, in Los
          Angeles, California, or by Microsoft's unendorsed
          certified or bank check payable to the order of "First
          American Title Insurance Company, as escrow agent"; and

        * $37,000,000 -- as may be adjusted in accordance with
          the Purchase Agreement or as may be increased at the
          Auction -- on the Closing Date by wire transfer of
          immediately available funds to the Escrow Account.

    (b) Purchase and Sale of Assets

        At the Sale Closing, Eddie Bauer will sell, assign,
        transfer, convey and deliver, or cause to be sold,
        assigned, transferred, conveyed and delivered, to
        Microsoft, and Microsoft will purchase and accept from
        Eddie Bauer, the Property free and clear of all
        encumbrances, other than permitted encumbrances and
        assumed liabilities under Section 363 of the Bankruptcy
        Code.

    (c) Assumption of Liabilities

        At the Closing and from and after the Closing Date,
        Microsoft will assume:

        * all liabilities in respect of the Property arising from
          and after the Closing Date; and

        * other liabilities, if any, as Microsoft may expressly
          agree in writing to assume.

    (d) "As Is" Purchase

        Microsoft represents and warrants that it is relying
        solely on its own inspections, investigations, studies,
        tests and analyses in purchasing the Property and is
        purchasing the Property as is, where is, with all faults
        now known or later discovered by Microsoft.  There are no
        warranties with respect to the Property or as to any other
        matter.

    (e) Break-up Fee

        Microsoft will be entitled to payment of a $665,000 Break-
        up Fee within five business days of the closing of the
        sale to a successful bidder other than Microsoft.

    (f) Expense Reimbursement

        Microsoft will be entitled to a reimbursement for its
        documented, out-of-pocket expenses reasonably incurred in
        connection with the transaction contemplated in the
        Purchase Agreement, not to exceed $200,000.

    (g) Title to the Property

        The Purchase Agreement requires Microsoft to cause First
        American to deliver to Eddie Bauer a preliminary title
        report for the Property dated May 3, 2004 and a copy of
        the underlying documents referenced there, within five
        days from the execution of the Purchase Agreement.
        Microsoft then has the right to deliver to Eddie Bauer
        within 10 days after the earlier of the issuance of any
        update, or continuation or supplement of the Title Report
        or the Closing, a written statement setting forth any
        objections to the title to the Property, other than
        objections to Permitted Encumbrances.  If Microsoft
        notifies Eddie Bauer of any additional exceptions, Eddie
        Bauer will be entitled to reasonable adjournments of the
        Closing during which Eddie Bauer may attempt to remove
        Additional Exceptions, provided, however, that Eddie Bauer
        will not be required to bring any action or proceeding, or
        take any steps, or otherwise incur any expense to remove
        any Additional Exception.

    (h) Indemnities

        The Purchase Agreement requires Microsoft to indemnify
        Eddie Bauer with respect to any claim by any third party
        for personal injury or property damage arising out of or
        resulting from any act or omission by Microsoft or its
        employees, agents or representatives in respect of the
        Property from and after the Closing Date or any occurrence
        on or about the Property from and after the Closing Date.
        The Purchase Agreement provides that Eddie Bauer agrees to
        indemnify and hold Microsoft harmless against and from any
        and all claims, liabilities, costs, or expenses arising
        out of (i) Permits and Licenses, if any; (ii) Guaranties
        and Warranties, if any; and (iii) other intangibles, if
        any, to the extent they arise out of obligations arising
        from and after July 8, 2004.  The Purchase Agreement
        provides that Microsoft agrees to indemnify and hold Eddie
        Bauer harmless against and from any and all claims,
        liabilities, costs, or expenses arising out of Permits and
        Licenses, Guaranties and Warranties, and Other
        Intangibles.

    (i) Eddie Bauer's Remedies

        If the sale of the Property to Microsoft is not
        consummated because of its own default under the Purchase
        Agreement or the failure of a condition to Eddie Bauer's
        obligation to close or termination of the Purchase
        Agreement, and if Microsoft is not otherwise entitled to
        the return of the Earnest Money Deposit or as elsewhere
        expressly provided in the Purchase Agreement, Eddie Bauer
        will be entitled to the delivery of the Earnest Money
        Deposit as Eddie Bauer's liquidated damages
        unconditionally and on a non-refundable basis and as its
        exclusive remedy for the default or failure.

    (j) Microsoft's Remedies

        If, on the Closing Date, Eddie Bauer will be unable to
        perform its obligations or to satisfy any condition
        applicable to it under the Purchase Agreement, then
        Microsoft will be entitled to the return of the Earnest
        Money Deposit and the parties will jointly instruct First
        American to promptly return to the Deposit, together with
        any accrued interest.  If Eddie Bauer breaches or defaults
        under the Purchase Agreement, Microsoft will have the
        right to specific performance of the Purchase Agreement.
        If Microsoft is not in material breach of the Purchase
        Agreement and either (i) Eddie Bauer withdraws the Sale
        Motion or (ii) an Approval Order has been entered by the
        Court authorizing a sale to a Successful Bidder, the
        Successful Bidder is not in breach of its agreement to
        purchase the Property from Eddie Bauer and,
        notwithstanding the satisfaction or waiver of all of Eddie
        Bauer's conditions to closing, Eddie Bauer elects not to
        sell the Property to that Successful Bidder, then
        Microsoft will be entitled to the Expense Reimbursement.
        Notwithstanding anything to the contrary in the Purchase
        Agreement, Microsoft will have no right to receive the
        Expense Reimbursement if Microsoft (i) becomes entitled to
        the Break-up Fee, or (ii) elects to pursue any right it
        may have to specific performance.

Eddie Bauer believes that Microsoft does not have any interest
with respect to the transaction that is materially adverse to
those of Eddie Bauer, its estate or other creditors, and will
verify the same with respect to any bidder at the Auction.

Mr. Tenzer informs the Court that no competing offeror at a
comparable price and terms would be willing to complete the time-
consuming and expensive due diligence and to go forward as a
stalking horse without the protections of a break-up fee in the
event they are outbid at the Auction and an expense reimbursement.

Under an Amended and Restated Loan and Security Agreement dated
May 2, 2003, made by and among, inter alia, the Debtors and Bank
of America, N.A. -- Agent for the Debtors' postpetition lenders --
and authorized by the Court, the terms of the Sale are subject to
the approval of the Debtors' postpetition lenders under the DIP
Agreement.

                           Seller's Lease

In connection with the Proposed Sale, Eddie Bauer proposes to
enter into a lease agreement with Microsoft, which Lease provides
for a term of three years, with an option to terminate after two
years, permitting Eddie Bauer a convenient and cost-effective
timeframe in which to locate, lease and construct alternative
facilities.  Eddie Bauer, therefore, seeks the Court's authority
pursuant to Section 363(b)(1) of the Bankruptcy Code to enter into
the Seller's Lease.  The terms of the Seller's Lease are subject
to approval of the Debtors' postpetition lenders under the DIP
Agreement.

             Payment of Prepetition Real Property Taxes

Eddie Bauer also seeks the Court's authority to pay any and all
real property taxes relating to the Property, that arose prior to
the Petition Date and are due and owing.  Eddie Bauer wants to
discharge any liens that may exist on the Property as a result of
the taxes.  Mr. Tenzer notes that payment of the prepetition real
property taxes, which total approximately $261,000, will provide
assurance to Microsoft that no taxing authority will, after the
Sale Closing Date, seek to enforce against Microsoft any alleged
liens on the Property arising from the taxes, which assurance
Microsoft requires to consummate the sale of the Property.
Providing assurance to Microsoft will therefore further encourage
it to enter into the Purchase Agreement, increase the likelihood
of a smooth sale of the Property and provide a benefit to Eddie
Bauer's estate.

The Debtor is permitted, pursuant to the DIP Agreement, to pay the
prepetition real property taxes in connection with the sale of the
Property.

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. 29;
Bankruptcy Creditors' Service, Inc., 215/945-7000)   


STRONGBOW: Joins Forces with Allyn to Explore Greenstone Belt
-------------------------------------------------------------
Strongbow Exploration Inc. (TSXV: SBW) and Allyn Resources Inc.
concluded an agreement to explore Strongbow's exploration
properties in the Committee Bay greenstone belt, Nunavut. Under
the terms of the agreement, Allyn may earn a 51% interest in the
properties by issuing 200,000 shares and reimbursing $100,000 in
staking costs to Strongbow and spending $4 million prior to
December 31, 2008.  Allyn may increase this interest to 60% by
spending an additional $3 million over the ensuing two years. The
agreement includes a firm commitment to spend $200,000 in 2004 on
airborne magnetic surveys and geological reconnaissance.

The Committee Bay properties are composed of approximately
216,000 acres of mineral claims staked by Strongbow in 2003 to
cover parts of the greenstone belt located adjacent to and along
strike from several gold showings currently being explored by
Committee Bay Resources Ltd., including the Three Bluffs and Four
Hills showings.  Ground reconnaissance to be performed by Allyn in
2004 will include an evaluation and recommendation with regard to
the Kim iron formation hosted gold showing located on Strongbow's
claims approximately 10 km to the northwest of Committee Bay
Resources' Four Hills showing.  Work will commence as soon as
practicable.

Strongbow Exploration Inc. was formed on May 3, 2004, as a result
of the amalgamation of Strongbow Resources Inc. and Navigator
Exploration Corporation, both significant northern explorers. The
new company maintains an interest in approximately 1.5 million
hectares of prospective land in Canada's north.  Strongbow is
actively exploring these properties, with exposure to over
$7 million in planned exploration expenditures in 2004.

Strongbow continues to pursue high-quality diamond, gold, silver
and base metal properties in an effort to provide shareholders
with leveraged exposure to northern Canada's most exciting
exploration plays.

As of January 31, 2004, Strongbow's balance sheet shows a
stockholders' deficit of $6,548,335, compared to a $6,006,916
deficit at January 31, 2003.

Allyn Resources is involved in mineral exploration and investment
in resource companies in Canada.

Committee Bay Resources holds greater than 2.8 million acres of
prospective ground in the eastern arctic.  In addition to the
C$7.1 million to be spent with joint venture partner Gold Fields
Limited on the Committee Bay project another $C2.0 million will be
spent on diamond and gold exploration this year.  Gold Fields
Limited, through a subsidiary, is funding all gold exploration on
the Committee Bay Project as part of its option to earn a 55 %
interest in the property by spending US$5.0 million over the next
4 years. Committee Bay Resources Ltd. is the operator.  

As of March 31, 2004, Committee Bay reported a stockholders'
deficit of C$1,118,554 compared to a deficit of C$797,092 at
December 31,
2003.


U.S. CANADIAN MINERALS: Dismisses Beckstead and Watts
-----------------------------------------------------
On June 11, 2004, the Board of Directors of U.S. Canadian
Minerals, Inc. dismissed Beckstead and Watts, LLP as its
independent public accountants.  The Company's Board of Directors
participated in and approved the decision to dismiss Beckstead and
Watts, LLP.

Beckstead and Watts, LLP had been the Company's certifying
accountant for the prior year.  During the past year, Beckstead
and Watts, LLPs' report on the Company's financial statements
contained an explanatory paragraph questioning the Company's
ability to continue as a going concern.


UNITED AIRLINES: Former Workers Agree to Huge Reduction in Claims
-----------------------------------------------------------------
United Airlines Inc. and its debtor-affiliates dispute certain
claims relating to workers' compensation rights and remedies.  The
Debtors asked United States Bankruptcy Court for the Northern
District of Illinois to reduce the Claims on the grounds that the
Workers' Compensation Claims were overstated upon review of their
Books and Records.  To reduce the liability on the Claims
Register, the Debtors have reached a stipulation to reduce the
amount of the Claims.

The Debtors asked the Claimants to estimate the present cash value
of their Claims.  The Claimants will not oppose entry of an order
reducing their Claims:

Claimant            Claim No.   Original Amount  Reduced Amount
--------            ---------   ---------------  --------------
Anderson, Kevin       25899         $500,000        $250,000
Bauch, Sheryl         25942        1,000,000         500,000
Geiger, Mimi          31891          500,000         125,000
Jefferson, Joyce      25990          600,000         175,000
Kellerman, Jeanna      4775        1,000,000         500,000
Krawcyk, Robert       25986          750,000         300,000
Nelson, Karen         25974          500,000         200,000
Patchman, Joanna      31880          600,000         600,000
                      21844          600,000
                      31845          600,000
Scanlon, George       35591          750,000         250,000

Pursuant to the Stipulation, Claim No. 25962 asserted by Lawrence
P. Erfort and Claim No. 25983 by Rosario Licciardi will be
disallowed and expunged.

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. 54; Bankruptcy Creditors' Service,
Inc., 215/945-7000)   


URS CORP: Wins $275 Million Ten-Year US Postal Service Contract
---------------------------------------------------------------
Through a joint venture formed with Parsons Brinckerhoff
Construction Services, Inc., URS Corporation (NYSE: URS) has been
awarded a nationwide Construction Management Support Services
Contract (CMSSC) with the United States Postal Service (USPS).
This contract is an indefinite delivery/indefinite quantity
contract with the USPS Supply Management Facilities Portfolio
Group to provide services for the USPS' Major Facilities Office
(MFO) and the eight Facility Service Offices (FSOs) across the
country.

Under the terms of the contract, as the USPS issues specific task
orders, the joint venture will provide construction management
assistance, design and design/construction management review
services. The contract includes a two-year base period and two
additional four-year option periods, for a total of ten years. The
contract has a maximum value of $75 million over the two-year base
period, and $275 million over the full ten years if both option
periods are exercised.

Commenting on the contract win, Gary V. Jandegian, President, URS
Division, said: "This is another significant win for URS, and one
that reflects our leadership in the federal facilities market. We
look forward to building on our longstanding track record of
providing high-quality services to the U.S. Postal Service through
our work on this important project."

URS Corporation offers a comprehensive range of professional  
planning and design, systems engineering and technical assistance,  
program and construction management, and operations and  
maintenance services for surface transportation, air  
transportation, rail transportation, industrial process,  
facilities and logistics support, water/wastewater treatment,  
hazardous waste management and military platforms support.  
Headquartered in San Francisco, the Company operates in more than  
20 countries with approximately 26,000 employees providing  
engineering and technical services to federal, state and local  
governmental agencies as well as private clients in the chemical,  
manufacturing, pharmaceutical, forest products, mining, oil and  
gas, and utilities industries http://www.urscorp.com/  

                        *   *   *

As reported in the Troubled Company Reporter's May 13, 2004  
edition, Standard & Poor's Ratings Services raised its corporate  
credit and senior secured bank loan ratings on URS Corp. to 'BB'  
from 'BB-'. At the same time, Standard & Poor's raised the senior  
unsecured and senior subordinated debt ratings to 'B+' from 'B'.  
The ratings were removed from CreditWatch, where they were placed  
on March 31, 2004. The outlook is positive.  
  
"The upgrade reflects decreased leverage and improved financial   
flexibility upon completion of URS' equity offering as well as
the expectation that the company will exercise a somewhat less  
aggressive financial policy in the future," said Standard &
Poor's credit analyst Heather Henyon. "Management's commitment to
a more conservative financial profile could lead to metrics
exceeding Standard & Poor's expectations in the intermediate
term, potentially leading to a ratings upgrade."


US UNWIRED: Reports $217.6 Mil Stockholders' Deficit at June 30
---------------------------------------------------------------
US Unwired Inc. (OTCBB:UNWR), a PCS Affiliate of Sprint
(NYSE:FON), today reported revenues of $147.9 million for the
three-month period ended June 30, 2004. The company posted EBITDA
(Earnings Before Interest, Taxes, Depreciation and Amortization)
for the consolidated operations of $23.9 million for second
quarter of 2004 comprised of $18.5 million generated by the US
Unwired credit group and $5.4 million from the company's wholly
owned subsidiary, IWO Holdings, Inc.

"We are very pleased that our operating results kept pace with the
highly successful improvements we made to our balance sheet during
the second quarter," said Robert Piper, US Unwired's President and
Chief Executive Officer. "Our focus on improving the quality of
our subscriber base continues to show positive results. In our
southern properties, postpay churn improved to 2.3%, down from
2.9% just a quarter ago--even as local number portability impacted
all but one of our markets for the first time. We also added
11,400 subscribers versus 4,400 in the same quarter of last year
and kept our CPGA costs below $400. All of this is extremely
positive and gives us further confidence that we can grow the
subscriber base significantly with a focus on the prime customer."

Further commenting on the southern region's operational results,
Piper continued, "Our advanced network design enabled us to
increase the data component of our average revenue per user by 30%
over last quarter. We again set network performance records even
with the most ever minutes of use--1.4 billion--while further
reducing dropped and blocked call rates to their lowest level
ever."

US Unwired refinanced a significant portion of its long-term debt
during the second quarter, issuing $360 million of new senior
secured notes. The company also eliminated $75 million face amount
of 13-3/8% senior subordinated discount notes through a series of
strategic debt-for-equity exchanges. Together, these transactions
reduced the US Unwired credit groups' all-in interest rate by
approximately 300 basis points.

On a consolidated basis, US Unwired had cash of approximately
$196.9 million and restricted cash of $8.2 million at June 30,
2004. All of the restricted cash and $40.2 million of the
unrestricted cash were held by IWO Holdings, Inc. At June 30,
2004, IWO was in payment and covenant defaults with its bank
credit facility. US Unwired has not guaranteed or otherwise become
responsible for IWO's debt.

In July 2004, US Unwired announced that it executed an agreement
to manage IWO Holdings, Inc. through 2005. The contract allows US
Unwired to charge a fixed fee for operating the company plus
additional fees for assisting in IWO's restructuring. US Unwired
also has the opportunity to earn bonuses for meeting pre-set
operating targets and lending managerial support for a successful
restructuring. Either party may terminate the agreement, but IWO
would pay termination fees to exercise its rights while US Unwired
would be obligated to perform pre-defined transition services
should it exercise its rights.

                        About Sprint

Sprint is a global integrated communications provider serving more
than 26 million customers in over 100 countries. With
approximately 63,000 employees worldwide and over $26 billion in
annual revenues in 2003, Sprint is widely recognized for
developing, engineering and deploying state-of-the-art network
technologies, including the United States' first nationwide all-
digital, fiber-optic network and an award-winning Tier 1 Internet
backbone. Sprint provides local communications services in 39
states and the District of Columbia and operates the largest 100-
percent digital, nationwide PCS wireless network in the United
States. For more information, visit http://www.sprint.com/

                      About US Unwired  

US Unwired Inc., headquartered in Lake Charles, La., holds direct  
or indirect ownership interests in five PCS Affiliates of Sprint:  
Louisiana Unwired, Texas Unwired, Georgia PCS, IWO Holdings and  
Gulf Coast Wireless. Through Louisiana Unwired, Texas Unwired,  
Georgia PCS and IWO Holdings, US Unwired is authorized to build,  
operate and manage wireless mobility communications network  
products and services under the Sprint brand name in 68 markets,  
currently serving over 650,000 PCS customers. US Unwired's PCS  
territory includes portions of Alabama, Arkansas, Florida,  
Georgia, Louisiana, Mississippi, Oklahoma, Tennessee, Texas,  
Massachusetts, New Hampshire, New York, Pennsylvania, and Vermont.  
US Unwired Inc. traded on the OTC Bulletin Board under the symbol  
"UNWR". For more information on US Unwired and its products and  
services, visit the company's web site at  
http://www.usunwired.com/  

                        *   *   *

As reported in the Troubled Company Reporter's June 23, 2004  
edition, Standard & Poor's Ratings Services raised its corporate  
credit rating on wireless carrier US Unwired Inc. to 'CCC+' from  
'CCC-'. The subordinated debt rating was raised to 'CCC-' from  
'C'. These ratings were removed from CreditWatch, where they were  
placed with positive implications on June 2, 2004, following the  
company's announcement of its refinancing plan and recent  
operating improvement, including better customer retention and  
cash flow growth. The upgrades are based on financial profile  
improvement from 3(a)(9) debt for equity exchanges, together with  
the company's recent offerings of $125 million senior secured  
first-priority floating rate notes due 2010 and $233.4 million in  
senior secured second-priority notes due 2012. The 'CCC+' rating  
on the first-priority notes and the 'CCC-' rating on the second-
priority notes were affirmed. The ratings outlook is positive.

At June 30,2004, US Unwired's balance sheet showed a stockholders'
deficit of $217,697,000 compared to a deficit of $229,767,000 at
December 31, 2003.


VERTIS INC: Stockholders' Deficit Widens to $363.5 Million
----------------------------------------------------------
Vertis Inc., a leading provider of targeted advertising, media and
marketing services, reported results for the three and six months
ended June 30, 2004.

For the quarter ended June 30, 2004, net sales were $396.9
million, $19.6 million or 5.2% above the second quarter of 2003.
For the six months ended June 30, 2004, net sales were $784.4
million, $35.8 million or 4.8% above the comparable 2003 period.
Earnings before interest, taxes, depreciation and amortization
amounted to $39.8 million in the three months ended June 30, 2004,
an increase of $0.6 million, or 1.5% versus the second quarter of
2003. EBITDA for the six months ended June 30, 2004 amounted to
$80.6 million, a decrease of $1.8 million or 2.2% versus the six
months ended June 30, 2003. Excluding a $10.1 million recovery
from a settlement to a legal proceeding in the first quarter of
2003, the 2004 EBITDA growth for the first six months would have
been 11.5%.

Donald E. Roland, chairman, president and chief executive officer,
stated, "The improving economic conditions and ongoing attention
to our cost base resulted in the double-digit EBITDA growth,
excluding the legal settlement, for the first six months. Our
sales and marketing teams are implementing a number of sales
initiatives to drive top-line growth both with existing customers
and in new markets."

Dean D. Durbin, chief financial officer, commented, "In the second
quarter, we implemented a restructuring program in our European
segment. Costs associated with this activity reduced our 2004
results by $1.5 million in the second quarter. In total, our
restructuring costs were $1.9 million in the second quarter and
$2.8 million for the six months. There were no restructuring
charges in the first six months of 2003. Excluding the
restructuring charges in 2004 and the insurance proceeds in 2003
we would have posted year-over-year EBITDA growth of 6.4% in the
second quarter and 15.4% through June 30. As a result, we finished
the quarter safely within our debt covenant requirements."

Vertis reported a net loss of $11.6 million in the second quarter
of 2004 versus a net loss of $71.9 million in the second quarter
of 2003. For the six months ended June 30, 2004, Vertis had a net
loss of $22.9 million as compared to $77.8 million for the six
months ended June 30, 2003. The 2003 second quarter and six month
net losses include a $48.8 million non-cash tax provision to
provide a valuation allowance against previously recorded deferred
tax benefits related to net operating loss carryforwards. This
amount is partially offset in the six months ended June 30, 2003
by the $10.1 million benefit from the legal settlement identified
above. Excluding the valuation allowance and the income from the
legal settlement, net loss for the six months ended June 30, 2004
decreased by $16.2 million or 41.4% from the comparable 2003
period.

Baltimore, Md.-based Vertis Inc. is a leading advertising and
marketing services concern.

At June 30, 2004, Vertis, Inc.'s balance sheet showed a
stockholders' deficit of $363,552,000 compared to a deficit of
$342,198,000 at December 31, 2003.


VITAL BASICS: Wants to Hire Mitchell Williams as Special Counsel
----------------------------------------------------------------
Vital Basics, Inc., and its debtor-affiliate, ask the U.S.
Bankruptcy Court for the District of Maine for authority to employ
Mitchell, Williams, Selig, Gates & Woodyard, P.L.L.C. as their
special counsel.

The Debtors want Mitchell Williams to assist them with regulatory
matters pertaining to a proposed nationwide product-related
consumer benefits program.  The Debtors assure the Court that
Mitchell Williams has extensive experience this kind of regulatory
matter.

Due to the highly confidential nature of the product-related
consumer benefit program, the Debtors ask the Court to limit the
disclosure of the nature of Mitchell Williams' specific services.
This, the Debtors point out, will prevent the irreparable harm
that would result from divulging the nature of the consumer
benefit programs to their competitors.

Currently, Mitchell Williams' professional rates are:

         Designation            Billing Rate
         -----------            ------------
         paraprofessional       $135 per hour
         junior attorneys       $185 per hour
         senior attorneys       $315 per hour

Mitchell Williams estimates that the total cost of services in
these cases will range from $15,000 to $20,000, and that the
amount of time needed to complete the work is 30-60 days.

Headquartered in Portland, Maine, Vital Basics, Inc.
-- http://www.vitalbasics.com/-- is engaged in the business of  
Sales, through direct consumer marketing and at retail, of
nutraceutical and related products throughout the United States
and Canada. The Company filed for chapter 11 protection along with
its debtor-affiliate, Vital Basics Media, Inc., on
May 10, 2004 (Bankr. D. Maine Case No. 04-20734).  George J.
Marcus, Esq., at Marcus, Clegg & Mistretta, P.A., represents the
Debtor in its restructuring efforts.  When the Debtors filed for
protection from their creditors, Vital Basics, Inc., listed
$6,291,356 in total assets and $16,314,589 in total debts; Vital
Basics Media, Inc., listed total assts of $378,308 and total debts
of $179,242.


W.R. GRACE: Court Approves Streamlined Claims Objection Process
---------------------------------------------------------------
The W.R. Grace & Co. Debtors, the Unsecured Creditors' Committee,
the Asbestos PI Committee and the Asbestos PD Committee proposed
streamlined claim objection procedures.  Judge Fitzgerald has
approved that protocol.  The protocol provides:

    (1) the provisions of the local rules of court are waived
        to permit the Debtors to file omnibus objections
        asserting any and all "gateway objections" against
        all claims, regardless of the aggregate number of
        those claims subject to the gateway objections; and

    (2) the gateway objections will consist of:

          (i) claims with "substantially incomplete proof of
              claim forms";

         (ii) claims that contain "materially insufficient
              supporting information";

        (iii) claims that fail to include any product
              identification information;

         (iv) claims that are barred by applicable statutes of
              limitation or repose;

          (v) claims that are barred by laches; and

         (vi) claims that are barred by prior settlements.

Judge Fitzgerald further waives the Delaware Local Rule that
limits to 150 the number of claims that may be subject to a
substantive omnibus claims objection, as well as the Local rule,
which requires that a debtor assert all substantive objections to
a particular claim in a single omnibus objection.  However, while
the Debtors are permitted to file gateway omnibus objections
asserting all gateway objections to a particular claim without
asserting or waiving any other substantive objections that are not
gateway objections to that claim, the Debtors may file only one
subsequent substantive objection to each claim for which a gateway
omnibus objection is filed.

           Notice to Asbestos Property Damage Claimants

Before the filing of any gateway objection to an asbestos property
damage proof of claim based on "materially insufficient supporting
information," the Debtors must serve, on any claimant as to whom
the objection is to be asserted, written notice by first class
mail of the Debtors' intention to object to the claim on that
basis.  Each affected claimant will then have 60 days from the
date of the notice in which to provide any supplemental or
additional information supporting the respective claim.  The
Debtors are enjoined from asserting any gateway objections to any
affected claim until the last response period has ended.

Once the response period has expired, the Debtors may then assert
any applicable gateway objection to the asbestos property damage
proof of claim.

             Notice to Non-Asbestos or Asbestos Medical
                        Monitoring Claimants

Before the assertion of any gateway objection to a non-asbestos
proof of claim or asbestos medical monitoring proof of claim based
on allegations that the claim lacks materially sufficient
supporting information, the Debtors are required to serve the same
sort of notice as that to the asbestos property damage claimants
where the prospective objection is materially insufficient
supporting information.

Each affected claimant will have 60 days from the date of the
notice in which to provide any supplemental or additional
information supporting the claim.  The Debtors are enjoined from
asserting any gateway objections to any affected claim until the
last response period has ended.

                         Notice to Counsel

The Debtors are required to mail a copy of the notice to counsel
for any claimant against whom the Debtors anticipate filing a
gateway omnibus objection.  If a claimant's counsel is not known,
then the Debtors are to mail a copy of the Order to the claimant
directly. (W.R. Grace Bankruptcy News, Issue No. 67; Bankruptcy
Creditors' Service, Inc., 215/945-7000)


WATERLINK: Senior Secured Lenders Recover 90%+ of Their Claims
---------------------------------------------------------------
On June 27, 2003, Waterlink, Inc., a Columbus, Ohio-based publicly
traded manufacturer of water and air purification products to the
industrial and environmental markets, along with certain of its
domestic subsidiaries, filed voluntary petitions for relief under
Chapter 11 of the United States Bankruptcy Code.  

Focus Management Group USA, Inc., guided the Debtors through a
wide variety of financial, business and insolvency related issues
culminating in a sale of substantially all of the Debtors' assets
under Section 363(b) of the Bankruptcy Code.

FOCUS played a critical role in assisting the Debtors and their
counsel with virtually all aspects of the bankruptcy cases.  FOCUS
was instrumental in assisting in the engagement of investment
bankers, and provided critical support in connection with the
successful marketing of the assets and the maximization of the
going concern values.  A settlement involving the Debtors, the
Committee and the senior secured lenders formed the predicate for
a joint plan filed by the Debtors and the Official Committee of
Unsecured Creditors.  This plan was recently confirmed with the
overwhelming support of the general unsecured creditors and the
unanimous support of the Debtors' senior secured lenders.  As a
result, the senior secured lenders have recovered in excess of 90
percent of their claims, and general unsecured creditors are
projected to receive significant recoveries.  FOCUS played a
central role in the negotiation and formulation of the settlement
agreement and the plan.

The FOCUS engagement was led by John E. Albert, a crisis manager
who has extensive top tier experience in complex Chapter 11
reorganizations, financial restructurings, operational turnarounds
and distressed business sales.  Mr. Albert is a Principal of
FOCUS, and he can be reached at (813) 281-0062 or
j.albert@focusmg.com

FOCUS Management Group offers nationwide capabilities in
turnaround and crisis management, business restructuring and asset
recovery. Headquartered in Tampa, FL, with offices in Chicago,
Greenwich, Los Angeles and Nashville, FOCUS Management Group
provides turn-key support to debtors, committees, financial
institutions, equity sponsors and other stakeholders. Focus
Management Group provides a comprehensive array of services
including turnaround and crisis management, interim management,
operational analysis and process improvement, bank and creditor
negotiation, asset recovery and recapitalization assistance, and
also acts as investment bankers to distressed companies.

Over the past decade, FOCUS Management Group has successfully
assisted clients operating in diverse industries, guiding them to
maximize performance or asset recovery. Adverse situations are
FOCUS Management Group's forte - finding winning solutions in a
timely manner when faced with the most discouraging of
circumstance is what separates FOCUS Management Group from the
competition.

The Debtor, an international provider of integrated water and air
purification solutions for both industrial and municipal
customers, filed for Chapter 11 (Bankr. Del. Case No. 03-11989) on
June 27, 2003.  Kurt F. Gwynne, Esq., at Reed Smith, LLP,
represents the Debtor in its restructuring efforts.  


WEIRTON STEEL: Resolves Independent Guards Union Claims
-------------------------------------------------------
At Debtor Weirton Steel Corporation's request, the United States
Bankruptcy Court for the District of West Virginia permits
Weirton to enter into an agreement with the Independent Guards
Union, which resolves all claims or potential claims asserted or
assertable by the IGU on behalf of its members and retirees
against Weirton arising under or related to their collective  
bargaining agreements.

Mark E. Freedlander, Esq., at McGuireWoods, in Pittsburgh,
Pennsylvania, tells the Court that Weirton and the IGU have
maintained a collective bargaining relationship since 1983.  The
IGU is the collective bargaining representative for approximately
20 guards at the Weirton facility.  

Weirton and the IGU were parties to collective bargaining
agreements, as amended from time to time, including these benefit
programs:

   (1) Agreement between Weirton and the IGU, effective as of
       September 26, 1996, as amended by:

       -- Settlement Agreement (Hourly Plant Guards), dated
          June 12, 2001;

       -- Settlement Agreement (Hourly Plant Guards), dated
          September 26, 2001;

       -- Settlement Agreement, dated November 13, 2002;

       -- Settlement Agreement, (Hourly Plant Guards), dated
          February 5, 2003; and

       -- Memoranda of Understanding between Weirton and the IGU,
          dated February 19, 2004 and April 22, 2004

   (2) Insurance Agreement, effective September 26, 1993

   (3) Supplemental Unemployment Benefits Plant (Hourly Plant
       Guards), effective September 26, 1993 (Plan 504)

   (4) Current CBAs may have provided for participation by
       members of the collective bargaining unit in:

       -- Weirton Steel Corporation Retirement Plan (Plan 001),
          terminated as of October 21, 2003;

       -- Weirton Steel Corporation 1984 ESOP (Plan 002);
   
       -- Weirton Steel Corporation 1989 ESOP (Plan 003);

       -- Weirton Steel Corporation Tax Deferred Savings Plan
          401(k) (Plan 004);

       -- Program of Health Benefits, Prescription Drug, Dental,
          Orthodontics, and Vision Benefits (Plan 501);

       -- Sickness & Accident Benefits (Plan 502);

       -- Travel Accident Insurance (Plan 511);

       -- Weirton Steel Corporation Employee Assistance Program
          (Plan 516); and

       -- Life Insurance (Plan 517)

The current collective bargaining agreements between Weirton and
the IGU will expire after the expiration of Weirton's collective
bargaining agreement with the Independent Steelworkers Union.

In connection to Weirton's Sale Transaction with International
Steel Group, Inc., and ISG Weirton, Inc., ISG may hire ISG's
represented workforce from among IGU employees of Weirton.  
Whether or not IGU members are hired by ISG, ISG and the IGU have
agreed to the terms and conditions of certain payment to be made
to IGU members upon termination of service, including:

   (a) certain vacation payments to former Weirton employees
       hired by ISG which were earned by those former Weirton
       employees prior to the Closing; and

   (b) certain buy-out payments to be paid by ISG under the
       Transition Benefit Program.

The IGU and ISG have agreed to a Transition Benefit Program to be
funded entirely by ISG.  A purpose of the Program is to induce
voluntary attrition of the IGU-represented workforce at Weirton,
thereby minimizing unemployment that would otherwise occur at the
time of the Closing.

To resolve all claims, Weirton and the IGU negotiated an Effects
Agreement, which provides for:

   (a) Establishment of timeframes -- 45 or 60 days, as the case
       may be -- after the Closing in which Weirton is obligated
       to provide the IGU and IGU-represented employees:

          (1) reports relating to employees eligible for workers'
              compensation benefits;

          (2) access to records including but not limited to
              medical records, work records and personnel files;

   (b) Provisions for cooperation with respect to implementation
       of the Transition Benefit Program;

   (c) Limitations on the extent to which claims for benefits
       provided under the Weirton/IGU collective bargaining
       agreements will be paid;

   (d) Limitations on the extent to which claims for benefits
       formerly provided by Weirton to IGU-represented retirees
       will be paid;

   (e) Termination of the collective bargaining agreements and
       the collective bargaining relationship between Weirton
       and the IGU as of the Closing on the Sale Transaction;
       and

   (f) A waiver and release by the IGU on behalf of itself and to
       the greatest extent permitted by law, its bargaining unit
       employees, former bargaining unit employees and retirees
       of claims, known or unknown, liquidated or unliquidated
       including but not limited to:

          (1) claims under the collective bargaining agreements,
              including grievance claims;

          (2) claims under the National Labor Relations Act, the
              Labor Management Relations Act, the WARN Act, ERISA
              and any other federal, state or local law relating
              to employment, discrimination in employment, wages,
              benefits or otherwise;

          (3) claims filed with the Bankruptcy Court; and

          (4) claims for reimbursement of counsel fees. (Weirton
              Bankruptcy News, Issue No. 31; Bankruptcy Creditors'
              Service, Inc., 215/945-7000)  


WESTAR FINANCIAL: Court Approves Plan of Liquidation
----------------------------------------------------
The United States Bankruptcy Court for the Western District of
Washington has approved the Plan of Liquidation for Westar
Financial Services, Inc. (Pink Sheets:WSFIQ), Chapter 11 debtor in
possession. Should the 10-day appeal period end without further
action, trading in the shares of Westar shall be suspended as of
the morning of August 9 and shares of WSFIQ will be deemed
cancelled as of Saturday, August 7, 2004. All trades executed
through the effective date will carry the right to receive
subsequent liquidation distributions, if any, regardless of the
settlement date.

Shareholders of record on the date of cancellation will be
entitled to receive future distributions, if any, following
payments to superior claimants pursuant to the terms of the Plan
of Liquidation.

A complete copy of the Debtor's proposed Plan of Liquidation can
be requested from Bush Strout & Kornfeld by calling 206-292-2110
or by visiting http://www.stockvalues.com/clients/westar.htm  

If you hold certificates and the name on the certificate is the
correct owner, you do not need to take any action. In order to
correct the record list, the following applies only if you have
transferred your shares to a private party. If you have a need to
formalize a private transfer with another individual (one not
processed through open market transactions with your brokerage
firm or bank), it must be completed immediately through the
transfer agent. For information on transferring certificates,
please visit http://www.stockvalues.com/clients/westar.htm

Westar Financial Services Incorporated (OTC: WEST) operates as a
unique financial services portal as it originates, decisions,
commits to and fulfills consumer financing for itself and its
strategic partners using sophisticated decision tools and high-
speed communications.


WH SMITH: Fitch Places Sr. Unsecured BB+ Rating on Watch Negative
-----------------------------------------------------------------
Fitch Ratings, the international rating agency, has placed WH
Smith plc's Senior Unsecured 'BB+' and Short-term 'B' ratings on
Rating Watch Negative.

The Rating Watch Negative follows WH Smith's announcement that it
plans to sell or de-merge its publishing business Hodder Headline
and return all net cash proceeds to shareholders. As a result, the
company's FY03 pro-forma sales and operating profit decreased by
c.GBP150 million and GBP20m respectively, leaving debt protection
measures very weak for a 'BB+' rating. Once the fate of Hodder has
been finalised the Rating Watch Negative will be resolved. The
resultant rating downgrade may exceed one notch.

WH Smith's announcement that it plans a partly debt-financed
GBP120m upfront payment to the Pension Trust, after the disposal
of Hodder Headline, has only limited implications for its credit
ratings, as Fitch already adjusts for pension deficits in
calculating key ratios. WH Smith's net pension deficit (after
related deferred tax assets) amounted to GBP133m at 29 February
2004. Due to the upfront payment, in FY05 WH Smith's pension
contributions will be reduced to c.GBP21m (down from GBP42m in
FY04) to pay off the total remaining deficit over nine years.

The group's financial profile has deteriorated continuously over
the past three years and the medium- to long-term strategy to
improve core UK retail operations, which accounted for 85% of
FY03's GBP106m operating profit before exceptional and goodwill
amortisation, carries significant execution risk. The strategy
consists mainly of cost control measures, the improvement of stock
availability as well as that of the store offer, and the
improvement in the product range planning. WH Smith has said total
store and central overhead cost savings should reach GBP30m per
annum by FYE07.

WH Smith's ratings are supported by the company's strong brand
recognition in the UK market and its considerable market positions
in the retail of books, newspapers, magazines and stationery, as
well as its number one market position in UK news distribution. It
is constrained by an increasingly competitive market in its core
UK retail business, the seasonality of its business, the company's
heavy reliance on operating leases in its business model and the
execution risk related to the UK retail strategy.

Aside from the GBP120m pension fund injection, WH Smith's on-
balance sheet debt is limited. However, substantial debt-like
commitments exist in the form of property-related annual operating
lease payments, which amounted to GBP206m of gross rental
commitments at FYE03.

The group's pension adjusted net debt/EBITDAR ratio of 4.6x at
FYE03 and pension-adjusted EBITDAR/interest+rent of 1.7x are
expected to deteriorate in FY05, due to the planned disposal or
de-merger of Hodder and the costs involved in the company's
strategy to improve its UK retail operations.


WORLDCOM INC: Citigroup Settles Class Action for $2.65 Billion
--------------------------------------------------------------
The Office of the New York State Comptroller announced that in a
Court Order entered Monday, July 19, Judge Denise L. Cote, United
States District Judge for the Southern District of New York,
granted preliminary approval of the landmark $2.65 billion
settlement reached with Citigroup and its affiliates in the
WorldCom, Inc. Securities Litigation class action.  As a result of
the Judge's preliminary approval order, a detailed Notice of the
Settlement and a claim form will be mailed to all Class members
beginning on August 2.  The Judge set November 5, 2004, as the
date for a final hearing on the proposed settlement, and March 4,
2005, as the date for submission of claim forms by Class members.

Comptroller Alan G. Hevesi commented, "As the Lead Plaintiff in
this case, I am very pleased we have achieved this significant
recovery for the Class.  We urge all Class members to read the
Notice carefully after it is sent out and submit the claim form
necessary to participate in the distribution of the settlement
fund."  Comptroller Hevesi further noted that Class members will
not be required to submit another claim form in the event there
are further recoveries, whether by future settlements or through
trial against the remaining defendants.  The case is continuing
against all defendants with whom settlements have not been
reached, with an eye toward the January 10, 2005 trial date.

As the Court determined earlier in the litigation, the Class
consists of all persons who purchased or acquired publicly traded
securities of WorldCom during the period from April 29, 1999
through and including June 25, 2002, including all persons or
entities who acquired shares of WorldCom common stock in the
secondary market or in exchange for shares of acquired companies
pursuant to a registration statement, and all persons or entities
who acquired debt securities of WorldCom in the secondary market
or pursuant to a registration statement, and who were injured
thereby.

Persons with questions concerning the Settlement, the submission
of claim forms, or who wish to obtain a copy of the Notice, which
will be mailed to Class members the first week of August, may
access the website being maintained for the case,
http://www.worldcomlitigation.comor by contact the attorneys for  
the Comptroller Barrack, Rodos & Bacine, 3300 Two Commerce
Square, 2001 Market Street, Philadelphia, PA 19103, (215) 963-
0600, http://www.barrack.com/and Bernstein Litowitz Berger &
Grossmann LLP, 1285 Avenue of the Americas, New York, NY 10019,
(212) 554-1400, http://www.blbglaw.com/who are serving as Co-
Lead Counsel for the Class.

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, 2004, 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. 58; Bankruptcy Creditors' Service,
Inc., 215/945-7000)  


* Jeffrey R. Manning to Lead FTI Capital Advisors
-------------------------------------------------
FTI Consulting, Inc. (NYSE: FCN), the premier provider of
corporate finance/restructuring, forensic and litigation
consulting, and economic consulting, today announced that its
wholly owned investment banking subsidiary has changed its name to
FTI Capital Advisors, LLC.  In addition, FTI Consulting announced
the appointment of Jeffrey R. Manning, senior managing director,
to lead the newly named investment bank.  The Company also
announced that Howard Loewenberg has joined FTI Capital Advisors,
LLC as a senior managing director.

Formerly known as FTI Merger & Acquisition Advisors, LLC, the new
name -- FTI Capital Advisors, LLC -- reflects the broader mandate
of the subsidiary's capabilities which includes advising on debt
and equity private placements, providing sell-side and buy-side
acquisition advisory services, delivering fairness opinions and
valuation engagements to our clients around the globe. The
subsidiary will continue to work with distressed and healthy
public and privately held companies, with a particular focus on
several industries, including telecommunications, healthcare,
retail, and basic service and manufacturing. FTI Capital Advisors,
LLC is a member of the NASD and SIPC.

                Jeffrey R. Manning Named Head of
                   FTI Capital Advisors, LLC

Jeff Manning, based in Washington D.C., has more than two decades
of transaction-related experience including investment banking,
loan workout, operating restructuring, value investing, bankruptcy
advising and loan trading. In addition to his engagements across
the United States, he has worked extensively on distressed
investment and private placement opportunities in Mexico, Canada,
the United Kingdom and mainland Europe.

Prior to joining FTI in 2003, Mr. Manning was a managing director
and head of the special situations practice at Legg Mason Wood
Walker, Inc. Mr. Manning holds a BA from Yale University, an MBA
from Columbia University, and is qualified as a general securities
representative and as a general securities principal.

        Howard Loewenberg Joins FTI Capital Advisors, LLC
                  as Senior Managing Director

FTI Consulting also announced that Howard Loewenberg has joined
FTI Capital Advisors, LLC as a senior managing director. Mr.
Loewenberg, who has over 15 years experience as an investment
banker, spent all but one year of his career with Alex. Brown &
Sons and its successors, Bankers Trust Corporation and Deutsche
Bank Securities, where he was most recently managing director and
co-head of the North American Telecommunications investment
banking practice. During the year prior to joining FTI, Mr.
Loewenberg was a managing director for the Baltimore-based
investment bank, Moag & Company, focusing on the sports industry.
His transactional experience also includes advisory and financing
deals in the financial institutions, media, internet
infrastructure and healthcare industries. Mr. Loewenberg holds a
BA from Yale University and an MBA from Stanford University, and
is a qualified corporate securities representative. He will work
out of FTI's Washington D.C. office.

Commenting on the news, Jack Dunn, chairman, chief executive
officer and president said "FTI Consulting is committed to
building our investment banking practice, and Jeff is an
extraordinary professional to steer the effort at FTI Capital
Advisors, LLC. We are also very pleased that Howard has agreed to
join us. His extensive background in investment banking only
intensifies the commitment," continued Mr. Dunn.

"The new name, FTI Capital Advisors, further demonstrates our
broader product and service offering and capabilities," said
Jeffrey Manning. "We are in a unique position to leverage FTI
Consulting's quality reputation in the corporate
finance/restructuring market, while offering specialized client
attention that the "major bracket" investment banks often find
difficult to match," Mr. Manning explained. "We believe our high
level of attention, working effectively with the outstanding
professionals in our forensic and litigation consulting, and
economic consulting practice, will provide superior service to our
clients."

                        About FTI Consulting

FTI is the premier provider of corporate finance/restructuring,
forensic and litigation consulting, and economic consulting.
Strategically located in 24 of the major US cities and London,
FTI's total workforce of approximately 1,000 employees includes
numerous PhDs, MBA's, CPAs, CIRAs and CFEs who are committed to
delivering the highest level of service to clients. These clients
include the world's largest corporations, financial institutions
and law firms in matters involving financial and operational
improvement and major litigation. FTI is on the Internet at
http://www.fticonsulting.com.


* Consumer Bankruptcy Filings Show First Decline in Four Years
--------------------------------------------------------------
Lundquist Consulting, Inc., an industry leader in bankruptcy
statistics and analytics releases findings that consumer
bankruptcy filings are down 3.0 percent through the first half of
2004 compared to 2003. This decrease represents the first drop in
consumer bankruptcy filings since 2000.

Consumer bankruptcy filings for the first six months of 2004 were
801,817, down from 825,792 in 2003. On an annualized basis, 1 in
every 67 households filed bankruptcy. Chapter 7 consumer filings,
providing consumers with the greatest relief of their unsecured
debts, declined 1.6 percent in the first half of 2004. Chapter 13
consumer filings, requiring consumers to repay a part of their
unsecured debts, declined 6.2 percent.

Chris Lundquist, Founder of Lundquist Consulting, Inc. has over 15
years of experience in the bankruptcy industry, publishing high
quality statistics and performing qualitative and quantitative
studies on the subject. Lundquist Consulting statistics are quoted
in research papers and media articles as well as used by
government entities for policy planning and legislative support
papers. Regarding the decrease of first half filings Mr. Lundquist
stated, "Hints of economic improvement are seen in various parts
of the country. On a regional basis, the Pacific is driving down
the country's bankruptcy rate, declining 9.3 percent through the
first half of 2004 compared to 2003."

    Growth in Filings by Region
     South (West)                             0.5
     South (East)                            -5.1
     Pacific                                 -9.3
     Northeast                                1.0
     North Central
     (West)                                  -2.6
     North Central
     (East)                                  -1.7
     Mountain                                 0.2

The decline in the Pacific was driven by California, which
decreased 11.8 percent in the first half of 2004. Other regions
showing decreases in bankruptcy filing rates include South (East)
at 5.1 percent, North Central (West) at 2.6 percent and North
Central (East) at 1.7 percent. Increases in filings were seen in
South (West) at 0.5 percent, Northeast at 1.0 percent and Mountain
at 0.2 percent. Filings grew the fastest in Colorado at 12.4
percent and Utah led the nation in bankruptcy filing rates with 1
in every 35 households filing, nearly twice the national rate of 1
in every 67 households. For Regional definitions, please visit our
site at http://www.nbkrc.com/regionaldef.html

Bankruptcy trends, statistics and analytics are updated weekly and
available through the National Bankruptcy Research Center (NBKRC),
a product offered by Lundquist Consulting, Inc. to clients on a
subscription basis.

          About the National Bankruptcy Research Center

The National Bankruptcy Research Center (NBKRC) is the resource
for bankruptcy research, financial planning and economic
evaluation. The data and analytics found at the NBKRC provide
subscribers with the most accurate, comprehensive and timely
bankruptcy statistics anywhere in the industry. Subscribers can
obtain information online at http://www.NBKRC.com/or through  
weekly updates sent directly to them.  Subscribers include
investment banking firms, securities exchanges, government
entities, mortgage brokerages, analysts, banks, members of the
media and online providers of economic and financial research.

                  About Lundquist Consulting, Inc.

Lundquist Consulting, Inc., -- http://www.LundquistConsulting.com/
-- founded in 1989, specializes in information engineering. The
firm brings over fifteen years of expertise in customized data
processing solutions, consulting services and research and
analytics with a strong emphasis in bankruptcy systems and
statistics. LCI has been working in the financial services and
technology industries since it's inception. Over that time our
principals have served on several industry steering and ad hoc
committees in the areas of financial counseling, risk management,
and technology. LCI has performed operational studies and worked
with industry executives and government entities on developing new
strategies for process improvement, risk management policy, and
position papers in support of pending legislation.


* BOOK REVIEW: Lost Prophets
----------------------------
Author:     Alfred L. Malabre Jr.
Publisher:  Harvard Business School Press
Hardcover:  256 pages
List Price: $19.95

Own your personal copy at
http://www.amazon.com/exec/obidos/ASIN/0875846440/internetbankrupt  

Review by Henry Berry

Alfred Malabre's personal perspective on the U. S. economy over
the past four decades is firmly grounded in his experience and
knowledge. Economics Editor of "The Wall Street Journal" from 1969
to 1993 and author of its weekly "Outlook" column, Malabre was in
a singular position to follow the U. S. economy in recent decades,
have access to the major academic and political figures
responsible for economic affairs, and get behind the crucial
economic stories of the day. He brings to this critical overview
of the economy both a lively, often provocative, commentary on the
economic circumstances and decisions at different points and a
comprehensive picture of the turns of the economy. To this he adds
sharp analysis and cogent explanation.

In general, Malabre does not put much stock in economists
"In sum, the profession's record in the half century since
Keynes and White sat down at Bretton Woods [after World War II]
provokes dismay." Following this sour note, he refers to the
belief of a noted fellow economist that the Nobel Prize in this
field should be discontinued. In doing so, he also points out that
the Nobel for economics was not one originally endowed by Alfred
Nobel, but was one added at a later date funded by the central
bank of Sweden apparently in an effort to give the profession of
economists the prestige and notice of medicine, science,
literature, and the other Nobel categories.

Malabre's view of economists is widespread, although rarely
expressed in economic circles. It derives from the plain fact
that modern economists, even hugely influential ones such as
John Maynard Keynes, are wrong as many times as they are right.
Their economic theories have proved incomplete or short-sighted,
if not basically wrong-headed. Their decisions meant to jump-start
the U. S. economy, reduce unemployment, or bring about some other
desirable effect have more often than not been seen to be
irrelevant or illusory. Malabre sees highly-visible economists
arguing for specific economic policies and decisions as mainly
skilled public-relations' persons or spokespersons for their
political sponsors with political agendas. For example, Malabre
thinks of the leading economist Milton Friedman and his
"monetarist colleagues" as "super salespeople, successfully
merchandising...an economic medicine that promised far more than
it could deliver" from about the 1960s through the Reagan years of
the 1980s. But the author not only cites how the economy has again
and again disproved the theories and exposed the irrelevance or
wrong-headedness of the policy recommendations of the most
influential economists of the day. Malabre also lays out abundant
economic data and describes contemporary
marketplace and social activities to show how the economy
performs almost independently of the best analyses and ideas of
economists.

Malabre does not engage in his critiques of noted
economists and prevailing economic ideas of recent decades as an
end in itself. What emerges in all of his consistent,
clear-eyed, unideological analysis and commentary is his own
broad, seasoned view of economics--namely, the predominance of
the business cycle. He compares this with human nature, which is
after all the substance of economics often overlooked by
professional and academic economists with their focus on
monetary policy, exchange rates, inflation, and such. "The
business cycle, like human nature, is here to stay" is the
lesson Malabre aims to impart to readers interested in
understanding the fundamental, abiding nature of economics. In
"Lost Prophets," in accessible, jargon-free, language, this
author who has observed, written about, and explained economics
from all angles for several decades, persuasively makes this
point.


                           *********

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
http://www.bankrupt.com/books/to order any title today.

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, Emi Rose
S.R. Parcon, 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
written permission of the publishers.  Information contained
herein is obtained from sources believed to be reliable, but is
not guaranteed.

The TCR subscription rate is $675 for 6 months delivered via e-
mail. Additional e-mail subscriptions for members of the same firm
for the term of the initial subscription or balance thereof are
$25 each.  For subscription information, contact Christopher
Beard at 240/629-3300.


                *** End of Transmission ***