TCR_Public/040913.mbx       T R O U B L E D   C O M P A N Y   R E P O R T E R

              Monday, September 13, 2004, Vol. 8, No. 196

                          Headlines

AIR CANADA: Attorney General Asks Court to Stay Sanction Order
ARGENT SECURITIES: Fitch Puts BB+ Rating on $8M Class M-9 Certs.
B & P APARTMENTS: Case Summary & 20 Largest Unsecured Creditors
BANDICOOT CORPORATION: Case Summary & Largest Unsecured Creditors
BRIDALS BY KAUFMAN'S: Case Summary & Largest Unsecured Creditors

CATHOLIC CHURCH: Wants to Retain Hamilton as Special Counsel
CHELL GROUP: Neil Anderson Discloses 12.8% Equity Stake
COEUR: Names Donald Moss Management Information Systems Director
CONTIMORTGAGE HOME: Performance Prompts S&P to Slash Ratings to D
CSFB MORTGAGE: Fitch Affirms Low-B Ratings on Eight Cert. Classes

CSFB MORTGAGE: Fitch Junks Class B-6 & Pares Class B-5 Rating to B
DELTA AIR: Fitch Expresses Concerns About Turnaround Plan
DII INDUSTRIES: U.S. Government Approves KBR Purchasing System
ENRON: Court Okays CrossCountry Sale to Southern Union/GE Comm'l.
FEDERAL-MOGUL: Environmental Claims Must be Filed by October 15

FRONTIER FINANCING: Moody's Withdraws Pref. Securities' C Rating
GE COMMERCIAL: Fitch Puts Low-B Ratings on Six Certificate Classes
GREENPOINT CREDIT: Fitch Shaves Ratings on Two Classes & Junks One
GOSHAWK RIDGE DEV'T: Case Summary & 5 Largest Unsecured Creditors
HANGER ORTHOPEDIC: Lenders Agree to Modify 5 Key Loan Covenants

HAYES LEMMERZ: Asks Court to Deny GE Capital to File Sur-Reply
IMMUNE RESPONSE: First HIV Patients Enrolled in New Int'l Trial
IMPERIAL SCHRADE CORP: Case Summary & Largest Unsecured Creditors
INNOVATIVE WATER: Taps James Edward Capital to Get More Financing
INTERCEPT INC: Inks Acquisition Pact by Fidelity Nat'l Financial

INTERSTATE BAKERIES: Gets Bank Commitment to Continue Funding
INTERSTATE BAKERIES: Hires Miller Buckfire for Financial Advice
IRISH PUB RESTAURANTS: Releases List of 20-Largest Creditors
ISLAND DREAMS LLC: Case Summary & 20 Largest Unsecured Creditors
KAISER ALUMINUM: Ferazzi Wants to Hire Haynes & Boone as Counsel

LIBERATE TECH: To Appeal Court Ruling Dismissing Bankruptcy Case
MCGARRH TRUCKING: Case Summary & 20 Largest Unsecured Creditors
METROPCS INC: Fails to Comply with Covenant Due to Late Filing
MIDLAND REALTY: Fitch Affirms Low-B Ratings on Cert. Classes J & K
MIRANT CORP: Has Until Plan Confirmation to Decide on Leases

MORGAN STANLEY: Fitch Assigns Low-B Ratings to Six Cert. Classes
NEWARK INSURANCE: Shut-Down Prompts Moody's to Withdraw Ratings
NOVA CDO: S&P Affirms Junk Ratings on Four CBO Notes Transaction
OM ENTERPRISES: Voluntary Chapter 11 Case Summary
ORBITAL SCIENCES: Names G. David Low VP-Techn'l Services Division

OWENS CORNING: Objects to M. Pope's Fee Disgorgement Request
PARMALAT: Has Until Thursday to File Plan & Disclosure Statement
PENN TRAFFIC: Selling Distribution Centers for $45.9 Million
PEREGRINE SYS: June 30 Balance Sheet Upside-Down by $272 Million
PRIME HOSPITALITY: Launches 8-3/4% Cash Tender Offer & Consent

QUESTERRE: Receives Court Approval for Corporate Restructuring
QWEST COMMS: Subsidiary Completes Tender Offer for Debt Securities
REPTRON ELECTRONICS: Facility Inks New Prod. Pact with Hunt Tech.
RIDDELL BELL: Moody's Assigns Single-B Ratings to Notes & Credit
RIDDELL BELL: S&P Assigns B+ Corporate Credit Rating

RUSSELL CORP: Names Robert Koney, Jr., Chief Financial Officer
SANRE REALTY CORPORATION: Voluntary Chapter 11 Case Summary
SCOTT ACQUISITION: Case Summary & 20 Largest Unsecured Creditors
SPIEGEL: Eddie Bauer Opens Outlet at The Shops at Briargate
SOLUTIA INC: Reports Status of Flexsys Related Litigation

SUMMITVILLE TILES: Files Chapter 11 Plan of Reorganization
SUPERIOR NAT'L: Liquidation Cues Moody's to Withdraw Junk Ratings
TNP ENTERPRISES: Acquisition by PNM to Strengthen Fin'l Positions
TRICO MARINE: 67% of Sr. Noteholders Support Chapter 11 Pre-pack
UNITED AIR: Names Sean Donohue United Express & Ted Vice-President

US AIRWAYS: Files for Chapter 22 Protection in E.D. Virginia
US AIRWAYS GROUP: Case Summary & 95 Largest Unsecured Creditors
U.S. CANADIAN: Purchases 1.66% More Interest in CMKM Diamonds
U.S. CANADIAN: Gets $3 Million of Funding Via Private Placement
VENTAS INC: Appoints Christopher T. Hannon to Board of Directors

VENTAS INC: Closes New $300 Million Secured Credit Facility
VISTEON CORP: Moody's Reviewing Low-B Ratings & May Downgrade
W.R. GRACE: Objects to Massachusetts Environmental Claims
WAVING LEAVES: Hires David Wilson as Accountants
WEST PENN: Plans to Transition Bellevue Hospital to AGH

* Accountants Face New Concerns Says Cendrowski Corporate Advisors
* Gregory Ford Joins Alvarez & Marsal as Director

* BOND PRICING: For the week of September 13 - September 17, 2004

                          *********


AIR CANADA: Attorney General Asks Court to Stay Sanction Order
--------------------------------------------------------------
The Attorney General of Canada asks the Court of Appeal of Ontario
to rule whether Mr. Justice Farley's Sanction Order approving the
Applicants' Plan of Reorganization, Compromise and Arrangement,
will, as of September 30, 2004, extinguish or render "moot" its
right to seek leave to appeal the Part III Complaints Order and
any subsequent appeal if not heard and determined before that
date.

If so, the Attorney General asks the Court of Appeal to stay the
Sanction Order insofar as it purports to extinguish any
outstanding Part III Complaints, including those complaints
subject to its appeal, until its request for leave to appeal
pending before the Court of Appeal and any subsequent appeal can
be heard.

The Sanction Order releases all outstanding claims against the
Applicants as of September 30, 2004.

Mr. Justice Farley dismissed the Attorney General's request to
exclude claims arising under Part III of the Canada Labour Code
that are asserted by 11 non-unionized Air Canada employees from
compromise under the Companies' Creditors Arrangement Act.  The
Attorney General has taken the matter to the Court of Appeal for
review.

The Applicants anticipate emerging from bankruptcy by September
30, 2004.  The Applicants have taken the position that the
Sanction Order extinguishes the Attorney General's request for
leave to appeal the Part III Complaints Order and any subsequent
appeal if not determined by the Court of Appeal by that date.

Jacqueline Dais-Visca, Solicitor for the Attorney General,
explains that the appeal raises serious, precedential issues
relating to the statutory interpretation of the CCAA.  The
monetary value of the Part III Complaints is insignificant in the
context of the billions of dollars of claims being compromised by
the Applicants and will not unduly, if at all, interfere with the
Applicants' ability to emerge from CCAA Court protection.
However, the determination of whether to grant leave to review the
correctness of the Part III Complaints Order and any subsequent
appeal can await the Applicants' emergence.

The Attorney General believes that there is an apparent conflict
between the Parliament of Canada's policy of protecting minimum
employment standards under Part III of the Canada Labour Code and
the Parliament's policy of facilitating the reorganization of
financially troubled companies.  Ms. Dais-Visca points out that
the Parliament has resolved any such conflict in favor of
protecting minimum employment standards under Part III, including
the employee's right to seek redress against both the
restructuring company and its directors for breaches of the
proscribed statutory minimum employment standards.

If the stay is not imposed, the Attorney General suggests that the
Court of Appeal expedite the hearing on its request for leave to
appeal the Part III Complaints Order so that the request is
determined before September 30, 2004.

                         Applicants Respond

The Applicants consent to an expedited hearing of the Attorney
General's request for leave to appeal the Part III Complaints
Order.  If leave to appeal is denied before September 30, 2004,
then the Attorney General's request to stay the Sanction Order is
unnecessary.

The Applicants tell the Court of Appeal that staying the release
provisions of the Sanction Order serves to amend the Plan.  This
should not be.  The Applicants have worked diligently over the
past 17 months to coordinate a complex series of corporate
arrangements to ensure their expedient emergence from bankruptcy.
Any harm that the Attorney General or the Part III complainants
may suffer if the stay is not granted and the appeal becomes moot
will be vastly outweighed by the harm to the Applicants, their
stakeholders, and the Canadian public, should the Applicants'
emergence be delayed.  If the stay is imposed, the Applicants'
entire restructuring will be put at risk.  The Applicants will
suffer permanent damage resulting in possible litigation and, at a
minimum, a serious loss of investor, creditor and consumer
confidence.

The Applicants assert that the Attorney General will not suffer
any harm if the stay is not granted.  The Attorney General has
known about the Claims Procedure since September 2003 and the
Applicants' intention to compromise Part III claims since at least
November 2003.  However, the Attorney General did not bring before
the CCAA Court the issue whether or not the Part III Claims can be
compromised by the Plan until July 2004.  The Attorney General's
last-minute behavior is the type that courts have recognized
indicates there is not irreparable harm at issue. In Dylex Ltd. v.
Factory Carpet Corp. (1989), 44 C.P.C. (2d) 96 (Ont. H.C.J.), the
Dylex court held that:

      "One is driven to the conclusion that if the plaintiff
      was suffering irreparable harm, it would have moved
      expeditiously . . . the plaintiff failed to adduce
      sufficient evidence to demonstrate irreparable harm."

Irreparable harm must be clear and not speculative.  The
Applicants point out that the Attorney General has not put forward
any evidence to show that clear harm will be suffered if the
Sanction Order is not stayed.

The Applicants also note that no Affected Unsecured Creditor will
be able to collect 100% of their claims.  Nevertheless, the
creditors voted overwhelmingly in favor of the Plan.  The
Applicants assert that any harm that is potentially suffered by
Part III complainants is equal to the harm suffered by all their
unsecured creditors.

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 filed a Section
304 petition in the U.S. Bankruptcy Court for the Southern
District of New York (Case No. 03-11971).  Sean F. Dunphy, Esq.,
and Ashley John Taylor, Esq., at Stikeman Elliott LLP, in Toronto,
serve as Canadian Counsel to the carrier. 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. 48; Bankruptcy Creditors' Service, Inc., 215/945-
7000)


ARGENT SECURITIES: Fitch Puts BB+ Rating on $8M Class M-9 Certs.
----------------------------------------------------------------
Argent Securities Inc. 2004-W10 is rated by Fitch as follows:

   -- $645,200,000 classes A-1 and A-2 certificates 'AAA',;
   -- $24,800,000 class M-1 certificates 'AA+';
   -- $24,000,000 class M-2 certificates 'AA';
   -- $14,000,000 class M-3 certificates 'AA-';
   -- $24,000,000 class M-4 certificates 'A';
   -- $12,000,000 class M-5 certificates 'A-';
   -- $10,000,000 class M-6 certificates 'BBB+';
   -- $8,000,000 class M-7 certificates 'BBB';
   -- $8,000,000 class M-8 certificates 'BBB-';
   -- $8,000,000 privately offered class M-9 certificates 'BB+'.

Credit enhancement for the 'AAA' rated class A certificates
reflects the 16.60% subordination provided by classes M-1 to M-9,
monthly excess interest, and initial overcollateralization -- OC
-- of 2.75%.

Credit enhancement for the 'AA+' rated class M-1 certificates
reflects the 13.50% subordination provided by classes M-2 to M-9,
monthly excess interest, and initial OC.

Credit enhancement for the 'AA' rated class M-2 certificates
reflects the 10.50% subordination provided by classes M-3 to M-9,
monthly excess interest, and initial OC.

Credit enhancement for the 'AA-' rated class M-3 certificates
reflects the 8.75% subordination provided by classes M-4 to M-9,
monthly excess interest, and initial OC.

Credit enhancement for the 'A' rated class M-4 certificates
reflects the 5.75% subordination provided by class M-5 to M-9,
monthly excess interest, and initial OC.

Credit enhancement for the 'A-' rated class M-5 certificates
reflects the 4.25% subordination provided by class M-6 to M-9,
monthly excess interest, and initial OC.

Credit enhancement for the 'BBB+' rated class M-6 certificates
reflects the 3.00% subordination provided by class M-7 to M-9,
monthly excess interest, and initial OC.

Credit enhancement for the 'BBB' rated class M-7 certificates
reflects the 2.00% subordination provided by class M-8 and M-9,
monthly excess interest, and initial OC.

Credit enhancement for the 'BBB-' rated class M-8 certificates
reflects the 1.00% subordination provided by class M-9, monthly
excess interest, and initial OC.

Credit enhancement for the privately offered 'BB+' rated class M-9
certificates reflects the monthly excess interest and initial OC.
In addition, the ratings reflect the integrity of the
transaction's legal structure, as well as the capabilities of
Ameriquest Mortgage Company as master servicer (rated 'RPS2' by
Fitch).  Deutsche Bank National Trust Company will act as trustee.

The mortgage pool consists of closed-end, first lien subprime
mortgage loans that may or may not conform to Freddie Mac and
Fannie Mae loan limits.  As of the cut-off date, Sept. 1, 2004,
the mortgage loans have an aggregate balance of $625,000,768.  The
weighted average loan rate is approximately 7.191%.  The weighted
average remaining term to maturity is 356 months.  The average
cut-off date principal balance of the mortgage loans is
approximately $182,429.  The weighted average original loan-to-
value ratio is 79.91%, and the weighted average Fair, Isaac & Co.
-- FICO -- score is 605.  The properties are primarily located in:

   * California (32.18%),
   * Florida (9.81%), and
   * New York (8.31%).

In addition, on or before the 90th day following the closing date,
the trust will acquire $174,999,232 in subsequent mortgage loans
to be included in the mortgage pool.

The loans were originated or acquired by Argent Mortgage Company,
LLC, and Olympus Mortgage Company.  Both mortgage companies are
subsidiaries of Ameriquest Mortgage Company, which is a specialty
finance company engaged in the business of originating,
purchasing, and selling retail and wholesale subprime mortgage
loans.  Both Argent and Olympus focus primarily on wholesale
subprime mortgage loans.


B & P APARTMENTS: Case Summary & 20 Largest Unsecured Creditors
---------------------------------------------------------------
Debtor: B & P Apartments, Inc.
        aka James Tackett
        aka Kathy Tackett
        1120 West Lexington Avenue
        Winchester, Kentucky 40391

Bankruptcy Case No.: 04-52937

Type of Business: The Debtor is engaged in the business of
                  rental of commercial and residential real
                  estate.

Chapter 11 Petition Date: September 3, 2004

Court: Eastern District of Kentucky (Lexington)

Judge: Joseph M. Scott Jr.

Debtor's Counsel: Matthew B. Bunch, Esq.
                  Bunch & Brock
                  271 West Short Street
                  805 Security Trust Bldg.
                  P.O. Box 2986
                  Lexington, KY 40588-2086
                  Tel: 859-254-5522
                  Fax: 859-233-1434

Total Assets: $5,938,900

Total Debts:  $4,849,673

Debtor's 20 Largest Unsecured Creditors:

Entity                                 Claim Amount
------                                 ------------
Bank One                                    $35,138

Chase Mastercard                            $26,008

AT&T                                        $24,820

Direct Merchants Bank                       $21,661

American Express Open                       $21,301

Advanta Business                            $14,000

US Bank                                     $12,579

Farm Bureau Bank                            $10,977

Hager Cabinets                              $10,759

84 Lumber                                    $9,112

Retail Services                              $8,200

Polaris Retail Services                      $8,054

Dell Financial                               $7,500

HH Gregg / GE Capital Consumer               $7,200

MBNA America                                 $7,100

Sears Gold Mastercard                        $6,427

CitiPlatinum Select                          $5,720

Wells Fargo                                  $4,468

Capital One                                  $4,360

GE Capital Consumer Card Co.                 $4,229


BANDICOOT CORPORATION: Case Summary & Largest Unsecured Creditors
-----------------------------------------------------------------
Debtor: Bandicoot Corporation
        dba WordsWorth Books
        30 Brattle Street
        Cambridge, Massachusetts 02139

Bankruptcy Case No.: 04-17416

Type of Business: The Debtor is an independent bookstore.
                  See http://www.wordsworth.com/

Chapter 11 Petition Date: September 9, 2004

Court: District of Massachusetts (Boston)

Judge: Joan N. Feeney

Debtor's Counsel: Thomas O. Bean, Esq.
                  Nutter, McClennen & Fish, LLP
                  One International Place
                  Boston, MA 02110-2699
                  Tel: 617-439-2000

Estimated Assets: $500,000 to $1 Million

Estimated Debts:  $1 Million to $10 Million

Debtor's 20 Largest Unsecured Creditors:

Entity                                 Claim Amount
------                                 ------------
Koen Book Distributors                     $386,080

Baker & Taylor                             $226,623

Random House, Inc.                          $50,322

Bookazine Company, Inc.                     $43,339

Thomas Hadley Trust                         $37,900

Penguin Group USA                           $33,980

Ronnie Oldenburg                            $26,888

American Express                            $25,543

Sanj Kharbanda                              $24,546

Wendy Smith                                 $24,146

Houghton Mifflin Co.                        $19,499

Martha Lightfoot                            $18,194

Kevin Griffiths                             $10,856

Cambridge Securities Co.                    $16,736

Julie Gerrity                               $10,856

Harvard Pilgrim Health Care                 $10,087

Jennifer Decan Shaw                          $9,968

Ingram Book Company                          $9,181

John Wiley & Sons, Inc.                      $8,026

Alex Toys, Panline USA, Inc.                 $7,509


BRIDALS BY KAUFMAN'S: Case Summary & Largest Unsecured Creditors
----------------------------------------------------------------
Debtor: Bridals By Kaufman's
        aka Kaufman's Wedding World
        aka Wedding World
        681 Clairton Boulevard
        Pittsburgh, Pennsylvania 15236

Bankruptcy Case No.: 04-32015

Type of Business: The Debtor is a wedding dress and bridal gown
                  retailer.   See http://www.weddingworld.com/

Chapter 11 Petition Date: September 10, 2004

Court: Western District of Pennsylvania (Pittsburgh)

Judge: Bernard Markovitz

Debtor's Counsel: Salene R. Mazur, Esq.
                  Campbell & Levine LLC
                  1700 Grant Building
                  Pittsburgh, PA 15219
                  Tel: 412-261-0310
                  Fax: 412-261-5066

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 Angelo                 Trade Credit            $1,500,000
1690 S. Congress Avenue       (estimated)
Suite 120
Delray Beach, FL 33445

Mon Cheri                     Trade Creditor            $321,646
1018 Whitehead Road Extension
Trenton, NJ 08638

Exclusive Bridals             Trade Creditor            $320,000
American Clothing Express
7601 Highway 64
Memphis, TN 38133

Alyce Designs                 Trade Creditor            $159,744

Mori Lee, LLC                 Trade Creditor            $141,456

Jovani                        Trade Creditor             $90,000

Bridal Originals              Trade Credit               $77,635

Bill Levkoff, Inc.            Trade Creditor             $62,092

Bari-Jay Fashions, Inc.       Trade Creditor             $59,479

Benjamin Walk Corp.           Trade Creditor             $55,509

Jessica McClintock            Trade Creditor             $50,000

Jasmine Enterprises, Inc.     Trade Creditor             $29,512

Jordan Fashions               Trade Creditor             $29,101

Fedex                         Trade Creditor             $25,374

Night Moves                   Trade Creditor             $61,567

Park Associates               Trade Creditor             $52,580

Washington Millinery Supply,  Trade Creditor             $42,252
Inc.

Preit Services                Trade Creditor             $35,886

Sarno & Son                   Trade Creditor             $28,165

R&M Apparel                   Trade Creditor             $24,126


CATHOLIC CHURCH: Wants to Retain Hamilton as Special Counsel
------------------------------------------------------------
Albert N. Kennedy, Esq., at Tonkon Torp, LLP, in Portland,
Oregon, recounts that the Archdiocese of Portland in Oregon
refused to answer several questions at the Section 341(a) Meeting
of Creditors on August 6, 2004, based on a purported privilege
arising from the First Amendment to the Constitution of the United
States of America.

At the Case Management Conference on August 4, 2004, the Debtor
asserted, among other things, that the Court may not have
jurisdiction to determine the estate's assets.

In its August 6, 2004 application to retain Rothgerber Johnson &
Lyons, LLP, as special counsel, the Debtor represented that it
needs the assistance and advice of special legal counsel to
resolve all First Amendment issues in the case.  The Debtor
believes that First Amendment issues would arise throughout the
case.

The Official Committee of Tort Claimants anticipates that the
Debtor will assert that the determination of its estate's assets
by the Court is an unconstitutional intrusion into church affairs.
Based on the position taken by the Debtor, the Tort Claimants
Committee finds it necessary to retain a special counsel to assist
in issues relating to the First Amendment and the Religious
Freedom Restoration Act.

Consequently, the Committee sought and obtained the Court's
authority to retain Marci A. Hamilton as of August 20, 2004, as
its special counsel.

Professor Hamilton is one of the country's leading First
Amendment scholars, holding the Paul R. Verkuil Chair in Public
Law at the Benjamin N. Cardozo School of Law at Yeshiva
University.  She has been a visiting scholar at Princeton
Theological Seminary, the Center of Theological Inquiry, New York
University School of Law, and Emory University School of Law.

Prof. Hamilton represented the City of Boerne, Texas, in a
successful challenge to the Religious Freedom Restoration Act -- a
case that resulted in the United States Supreme Court's decision
in Boerne v. Flores, 507 US 521 (1997).  Prof. Hamilton clerked
for Associate Justice Sandra Day O'Connor of the U.S. Supreme
Court and Chief Judge Edward R. Becker of the U.S. Court of
Appeals for the Third Circuit.  She received her J.D., magna cum
laude, from the University of Pennsylvania Law School where she
served as editor-in-chief of the University of Pennsylvania Law
Review.  Prof. Hamilton has published numerous articles on First
Amendment issues.

Prof. Hamilton will be paid $500 per hour.  Prof. Hamilton's
services will be billed to the Debtor's estate for payment as an
administrative expense under Sections 503(b) and 507(a)(1) of the
Bankruptcy Code.

No other arrangement or agreement exists between the Committee and
Prof. Hamilton with respect to the payment of Prof. Hamilton's
fees and disbursements.

Prof. Hamilton attests that she does not represent any other
entity having an adverse interest in connection with the Chapter
11 case, or have any connection with the Debtor, creditors, any
other party-in-interest.  Prof. Hamilton is a "disinterested
person" within the meaning of Section 101(14) of the Bankruptcy
Code.

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.  In its
Schedules of Assets and Liabilities filed with the Court on July
30, 2004, the Portland Archdiocese reports $19,251,558 in assets
and $373,015,566 in liabilities.  (Catholic Church Bankruptcy
News, Issue No. 5; Bankruptcy Creditors' Service, Inc., 215/945-
7000)


CHELL GROUP: Neil Anderson Discloses 12.8% Equity Stake
-------------------------------------------------------
Neil T. Anderson beneficially owns 4,630,000 shares of the common
stock of Chell Group Corporation, representing 12.8% of the
outstanding common stock of Chell.  Mr. Anderson holds sole powers
of voting and disposition over the stock.

Stonefield Josephson, Inc. included in its auditor's report a
substantial doubt about the company's ability to continue as a
going concern. "The Company's significant recurring operating
losses, working capital deficit, shareholders' deficit, and
negative cash flows from operations raise substantial doubt about
its ability to continue as a going concern," the Auditor reports.

At August 31, 2002, Chell Group Corporation's balance sheets
showed a C$16,988,536 stockholder's deficit, compared to a
positive equity of C$3,408,066 at August 31, 2001.


COEUR: Names Donald Moss Management Information Systems Director
----------------------------------------------------------------
Coeur d'Alene Mines Corporation (NYSE: CDE) appointed two new
officers in its finance and accounting group, and the advancement
of a new Director of Information Systems for the Company.

Appointed as Treasurer of the Company is Jennifer Kean, who was
previously Director of Financial Planning and Assistant Treasurer
of Coeur.  Ms. Kean joined Coeur in early 2004.  Prior to joining
Coeur, Ms. Kean worked as Director of Corporate Finance for Sony
Pictures Entertainment.  In addition, Thomas Angelos was named
Controller and Chief Accounting Officer of the Company.  Mr.
Angelos was previously with Coeur as Controller from 1983 to
1998, and prior to his return to the Company was Corporate
Controller at Stillwater Mining Company from 1998 to 2004.

The Company has also named Donald Moss as Director of Management
Information Systems.  Mr. Moss has been with the company since
1999 as Coeur's Manager of Information Systems.

Dennis E. Wheeler, Chairman & CEO stated, "I am pleased to make
this announcement.... I firmly believe our management team is the
deepest in the industry. These promotions are part of the
Company's growth plan".

Coeur d'Alene Mines Corporation is the world's largest primary
silver producer, as well as a significant, low-cost producer of
gold.  The Company has mining interests in Nevada, Idaho, Alaska,
Argentina, Chile and Bolivia.

                         *     *     *

As reported in the Troubled Company Reporter on June 3, 2004,
Standard & Poor's Ratings Services placed its B- corporate credit
and senior unsecured debt ratings on Coeur D'Alene Mines Corp. on
CreditWatch with positive implications following the company's
announcement that it intends to acquire precious metals mining
company Wheaton River Minerals Ltd. in a stock and cash
transaction valued at approximately $1.8 billion.

"The CreditWatch action reflects what is likely to be a meaningful
improvement in Coeur's business and financial profile upon the
successful acquisition of lower-cost producer Wheaton," said
Standard & Poor's credit analyst Paul Vastola.  Standard & Poor's
expects that its ratings on Coeur would likely be raised several
notches.  Standard & Poor's will continue to monitor the
transaction for any potential revisions to the deal.  The deal
remains subject to several conditions and is expected to close by
Sept. 30, 2004.


CONTIMORTGAGE HOME: Performance Prompts S&P to Slash Ratings to D
-----------------------------------------------------------------
Standard & Poor's Ratings Services lowered its ratings on class
B-I and class B-II from ContiMortgage Home Equity Loan Trust 1998-
3 to 'D' from 'CCC'.  Simultaneously, ratings are affirmed on the
remaining six classes from this transaction.

The lowered ratings on class B-I and B-II reflect a decrease in
credit support to the subordinate classes due to net losses that
consistently exceed excess interest, resulting in an erosion of
overcollateralization and losses being allocated to the
certificates.  Based on the current performance, it is not likely
that the principal losses will be fully recoverable.

The affirmations reflect adequate remaining credit support
percentages for the senior classes.

Credit support for the transaction is provided by subordination,
excess interest, and overcollateralization.  Additional credit
support for the senior classes is provided by bond insurance
issued by MBIA Insurance Corp.

As of the August 2004 distribution date, total delinquencies were
39.41% and 39.67% for groups 1 and 2, respectively.  Serious
delinquencies were 26.89% and 28.02%, and cumulative losses were
6.69% and 7.69% for groups 1 and 2, respectively.

The transaction is backed by fixed- and adjustable-rate subprime
home equity mortgage loans secured by first and second liens on
owner-occupied one- to four-family residences.

                        Ratings Lowered

          ContiMortgage Home Equity Loan Trust 1998-3
                        Pass-thru certs

                                 Rating
                   Class     To          From
                   -----     --          ----
                   B-I       D           CCC
                   B-II      D           CCC

                        Ratings Affirmed

          ContiMortgage Home Equity Loan Trust 1998-3
                        Pass-thru certs

                   Class              Rating
                   -----              ------
                   A-7, A-8, A-9      AAA
                   A-17, A-18, A-20   AAA


CSFB MORTGAGE: Fitch Affirms Low-B Ratings on Eight Cert. Classes
-----------------------------------------------------------------
Fitch Ratings affirms Credit Suisse First Boston Mortgage
Securities Corp. commercial pass-through certificates, series
2003-C3 as follows:

   -- $108.5 million class A-1 at 'AAA';
   -- $214.0 million class A-2 at 'AAA';
   -- $212.0 million class A-3 at 'AAA';
   -- $55.0 million class A-4 at 'AAA';
   -- $862.4 million class A-5 at 'AAA';
   -- Interest Only (I/O) class A-X at 'AAA';
   -- I/O class A-SP at 'AAA';
   -- I/O class A-Y at 'AAA';
   -- $47.4 million class B at 'AA';
   -- $19.4 million class C at 'AA-';
   -- $38.8 million class D at 'A';
   -- $19.4 million class E at 'A-';
   -- $19.4 million class F at 'BBB+';
   -- $12.9 million class G at 'BBB';
   -- $19.4 million class H at 'BBB-';
   -- $2.5 million class 622A at 'BBB-';
   -- $6.0 million class 622B at 'BBB-';
   -- $6.0 million class 622C at 'BBB-';
   -- $6.0 million class 622D at 'BBB-';
   -- $19.4 million class J at 'BB+'
   -- $12.9 million class K at 'BB';
   -- $17.8 million class 622E at 'BB';
   -- $1.6 million class 622F at 'BB';
   -- $6.5 million class L at 'BB-';
   -- $10.8 million class M at 'B+';
   -- $2.2 million class N at 'B';
   -- $4.3 million class O at 'B-'.

Fitch does not rate the $21.6 million class P.

The affirmations are due to the stable pool performance and
scheduled amortization.  As of the August 2004 distribution date,
the pool's aggregate principal certificate balance has decreased
1.1% to $1.75 billion compared to $1.76 billion at issuance.

There is currently one loan in special servicing.  7451 Beverly
Blvd. (0.16% of the pool) is secured by a 25,050 square feet (sf)
office building located in Los Angeles, California.  The loan was
delinquent due to the borrower having difficulty leasing the
vacant space at the property.  The special servicer Arcap
Servicing, Inc., recently informed Fitch that the loan has been
brought current and is working on potential strategies to return
the loan to the master servicer.

The five credit assessed loans (29.4% of the pool) remain
investment grade.  Fitch reviewed operating statement analysis
reports and other performance information provided by the master
servicer, Key Commercial Mortgage.  The debt service coverage
ratio -- DSCR -- for the loans are calculated based on a Fitch
adjusted net cash flow -- NCF -- and a stressed debt service on
the current loan balance and a hypothetical mortgage constant.

622 Third Avenue (11.6%) is secured by a 1.0 million sf class A
office building located in midtown Manhattan.  The whole loan, as
of August 2004, has an outstanding principal balance of
$285.0 million.  The whole loan was divided into a $203.0 million
pooled portion, a $40.0 million non-pooled portion (representing
classes 622A-622F) and a $43.0 million B-note held outside of the
trust.  The loan is interest only for the first two years then
amortizes on a 30-year schedule with an anticipated repayment date
of May 2013.  As of YE 2003 the Fitch adjusted NCF has declined
approximately 4.9% due to an increase in operating expenses.  The
corresponding DSCR for the pooled portion as of YE 2003 was
1.48 times (x) compared to 1.56x at issuance. As of June 2004
occupancy has remained flat at 98.0% since issuance.

Washington Center Portfolio (7.0%) is secured by a 888-room Grand
Hyatt mixed-use full-service hotel and a 355,718 sf class A office
complex, located between the White House and the U.S. Capitol in
the East End district of Washington, DC.  The whole loan, as of
August 2004, has an outstanding principal balance of
$213.5 million.  The whole loan was divided into a $122.0 million
senior A note, a $64.0 million B note and a $27.5 million C note.
The B and C notes are held outside of the trust.  There also
exists an additional $21.5 million senior mezzanine note and a
$15.0 million junior mezzanine note.

As of YE 2003 the Fitch adjusted NCF for the hotel portion
declined 5.0% since issuance due to a slight drop in revenue per
available room -- RevPar -- to $121.27 compared to $121.89 at
issuance.  The Fitch adjusted NCF as of YE 2003 for the office
portion declined 10.3% due to an increase in operating expenses
and a decrease in occupancy.  Occupancy as of May 2004 for the
office portion was 98.8% compared to 99.9% at issuance.  The DSCR
for the A note portion of the loan as of YE 2003 was 1.85x
compared to 1.96x at issuance.

Columbiana Center (4.0%) is secured by 464,588 sf of a 825,231 sf
regional mall located in Columbia, South Carolina.  The center is
anchored by Sears, Dillard's, Parisan's and Belk's.  In-line and
collateral occupancy as of May 2004 declined to 90.6% and 93.3%
respectively, compared to 94.1% and 98.8% at issuance.  The Fitch
adjusted NCF as YE 2003 declined 1.4% and the corresponding DSCR
remained flat at 1.37x since issuance, due to amortization on the
loan.  Fitch will monitor the leasing activity at the property.

The remaining two credit assessed loans, The Crossings (3.4%) and
Great Lakes Shopping Center (3.4%) have remained stable since
issuance.


CSFB MORTGAGE: Fitch Junks Class B-6 & Pares Class B-5 Rating to B
------------------------------------------------------------------
Fitch Ratings has taken rating actions on the following classes of
CS First Boston mortgage-backed securities, series 2001-2:

   -- Class IA1 affirmed at 'AAA';
   -- Class B-1 affirmed at 'AA';
   -- Class B-2 affirmed at 'A';
   -- Classes B-3 and B-4 downgraded to 'BB' from 'BBB';
   -- Class B-5 downgraded to 'B' from 'BB';
   -- Class B-6 downgraded to 'C' from 'B'.

The affirmations on the above classes reflect credit enhancement
consistent with future loss expectations.  The negative rating
actions on classes B-3, B-4, B-5, and B-6 are the result of poor
collateral performance, level of losses incurred, and future loss
expectations.  The 0.15% original credit support provided by the
unoffered class B-7 certificate has been depleted.

The mortgage pool supporting the trust is substantially paid down,
with the current pool factor (current mortgage loans outstanding
as a percentage of the initial pool) at 6.00%.  As of the August
2004 distribution, the current pool balance is $9,137,148.00.  The
mortgage pool is currently 43 months seasoned.  There are 80
mortgage loans remaining, 18 loans of which are in the delinquency
buckets.  The 90 plus delinquencies represents 13.69% of the
mortgage pool, 4.82% and 8.87% represents Foreclosure and REO,
respectively.  The original mortgage pool consisted of 548 30-year
fixed-rate mortgage loans.  Approximately 71.0% of the loans were
collateralized by single-family detached properties with a
weighted average loan to value ratio of approximately 78.5%.  The
greatest concentration of properties is in California (37%).


DELTA AIR: Fitch Expresses Concerns About Turnaround Plan
---------------------------------------------------------
Fitch Ratings believes that Delta Air Lines (Delta, senior
unsecured debt rated 'CC' by Fitch) plans to eliminate its hub at
Dallas-Fort Worth International Airport (DFW) and redistribute its
aircraft among its other hubs cities, which it announced Thursday,
Sept. 9, providing these latter airports short-term benefits but
heightening some long-term credit concerns.

Based on its announcement Wednesday, Sept. 8, Delta plans to
increase daily operations at Atlanta Hartsfield-Jackson
International Airport (senior general airport revenue bonds
(GARBS) rated 'AA-' by Fitch) to 1,051 daily flights in February
2004 from 970 currently and provide service to seven additional
cities. Delta also plans to institute a 'rolling hub' at the
airport, which spreads flights throughout the day rather than in
concentrated banks, which should allow for smoother operations and
generate efficiencies.

The airline's schedule at Cinncinati/Northern Kentucky
International Airport (operated by Kenton County Airport Board;
senior lien GARBS rated 'A' by Fitch) increases to 619 daily
flights in February 2005 from 590 at present, with an additional
three cities served from the airport. Delta recently initiated its
revamped fare structure, dubbed 'SimpliFares', in Cincinnati in an
effort to address growing competition from regional airports such
as Dayton International (senior lien GARBs rated 'BBB+' by Fitch).

While both Atlanta-Hartsfield Jackson and Cincinnati/Northern
Kentucky airports should benefit from increased enplanement
activity in the near term, their heightened reliance on Delta,
which continues to face significant financial challenges that may
lead to the airline seeking protection under Chapter 11 of the
U.S. Bankruptcy Code, represents a significant credit concern.
While both airports feature attractive local markets that may
attract replacement service should Delta substantially reduce its
presence at either facility, it is unlikely that another airline
would quickly replicate Delta's hub operations at either location
in the current economic environment. Thus the financial operations
of the airports may be strained, at least temporarily, should
Delta significantly reduce its hubbing operations at either or
both facilities in the future.

Delta also announced increased service from five 'focus city'
airports: Boston Logan International (Massachusetts Port
Authority, senior lien revenue bonds rated 'AA-' by Fitch); New
York John F. Kennedy International Airport (Port Authority of New
York and New Jersey, senior lien revenue bonds rated 'AA-' by
Fitch); Ft. Lauderdale-Hollywood (FL) International Airport
(Broward County senior lien GARBs rated 'A+' by Fitch); Orlando
(FL) International Airport (Greater Orlando Aviation Authority,
senior lien GARBs rated 'AA- by Fitch); and Tampa (FL)
International Airport (Hillsboro County Aviation Authority, senior
lien GARBs rated 'A+' by Fitch).

While the increased presence of Delta does raise the exposure of
each of these airports to the financially troubled carrier, Delta
does not represent more than 25% of enplanements at any of the
five airports. Furthermore, as the traffic at these airports
consists mainly of origination and destination passengers rather
than connecting passengers, Fitch believes other carriers would
likely expand service to capture a greater share of the market
should Delta leave any or all of these facilities.

As reported in the Troubled Company Reporter, DFW International
Airport says it will continue to work closely with Delta Air Lines
in its restructuring efforts and foresees long-term growth for the
Airport in the years ahead.  The Airport confirmed communications
with Delta officials on the possibility of restructuring.  Delta
announced it is reducing its daily flights at DFW from 256 to 21,
with the remaining flights servicing Delta's other hubs in
Atlanta, Cincinnati and Salt Lake City.  Delta expects the new
flight schedule to be in place by January 31, 2005.   The airline
will also significantly reduce its workforce in North Texas.

Delta Air Lines' top executive outlined key elements of the
company's transformation on Tuesday intended to launch "the right
airline for the new era" by improving its customers' traveling
experience while simultaneously targeting more than $5 billion in
annual cash savings by 2006.  The company is on track to deliver
by the end of this year through its previously announced Profit
Improvement Initiatives (PII) approximately $2.3 billion of the
total savings target.

                      About Delta Air Lines

Delta Air Lines is proud to celebrate its 75th anniversary in
2004.  Delta is the world's second largest airline in terms of
passengers carried and the leading U.S. carrier across the
Atlantic, offering daily flights to 493 destinations in 87
countries on Delta, Song, Delta Shuttle, the Delta Connection
carriers and its worldwide partners.  Delta's marketing alliances
allow customers to earn and redeem frequent flier miles on more
than 14,000 flights offered by SkyTeam, Northwest Airlines,
Continental Airlines and other partners.  Delta is a founding
member of SkyTeam, a global airline alliance that provides
customers with extensive worldwide destinations, flights and
services.  For more information, please visit http://delta.com/

                          *     *     *

As reported in the Troubled Company Reporter on August 23, 2004,
Standard & Poor's Ratings Services lowered Delta Air Lines,
Inc.'s corporate credit rating and the ratings on Delta's
equipment trust certificates and pass-through certificates to
'CCC'.  Any out-of-court restructuring of bond payments or a
coercive exchange would be considered a default and cause the
company's corporate credit rating to be lowered to 'D' -- default
-- or 'SD' -- selective default, S&P noted.  Ratings on Delta's
enhanced equipment trust certificates, which are considered more
difficult to restructure outside of bankruptcy, were not
lowered.

A Committee of Senior Secured Aircraft Creditors of Delta Air
Lines, Inc., holding $1.4 billion of senior secured debt and
represented by the law firm of Bingham McCutchen LLP, has asked
Delta for more information. Delta hasn't been forthcoming, the
Committee indicated last week.


DII INDUSTRIES: U.S. Government Approves KBR Purchasing System
--------------------------------------------------------------
KBR, a subsidiary of Halliburton (NYSE:HAL), has been granted
continued approval of its purchasing system by the Defense
Contract Management Agency (DCMA).  The DCMA is the United States
Government agency that has the authority to make final decisions
and judgments about the adequacy of the Company's business
systems.

KBR underwent an extensive Contractor Purchasing System
Review (CPSR) conducted by the DCMA in April and May of this year.
Prior to this review, KBR's purchasing system had been approved by
the Government in June 2003.  It was determined that another
review was prudent due to the unprecedented level of support KBR
currently provides the military in Iraq and Kuwait.

DCMA issued an approval letter on September 7, 2004, stating that
KBR's purchasing system's policies and practices are "effective
and efficient, and provide adequate protection of the Government's
interest."  KBR has repeatedly said that its purchasing system
provides the flexibility and responsiveness necessary to meet the
needs of its customers in a war zone. KBR's priority remains
making certain that the troops have the best possible food,
shelter and living conditions while fighting the war in Iraq.  We
will continue to work with all Government agencies to establish
that our contracts are not only good for the United States, but
also the company is the best and most qualified contractor to
perform these difficult and dangerous tasks.

"While expected, this is clearly good news. Despite the constantly
changing requirements of our customer and the challenges
associated with operating in such a hostile environment, KBR
continues to comply with the Government-mandated Federal
Acquisition Regulation in all of our procurement actions, and we
constantly seek out and implement improvements to our systems,"
said Andy Lane, president and chief executive officer, KBR.  "This
latest approval of our purchasing system by the Government only
validates that fact."

Halliburton has a 60-year history of working with the government.
KBR helped build U.S. warships in World War II, as well as
projects in Somalia, Rwanda, and the Balkans. Halliburton also
helped put out more than half of the oil well fires in Kuwait
during the 1991 Gulf War.  We are proud to serve the troops making
them feel a little closer to home.

Headquartered in Houston, Texas, Kellogg, Brown & Root is engaged
in the engineering and construction business, providing a wide
range of services to energy and industrial customers and
government entities in over 100 countries. DII has no business
operations.  The Company filed for chapter 11 protection on
December 16, 2003 (Bankr. W.D. Pa. Case No. 02-12152). Jeffrey N.
Rich, Esq., Michael G. Zanic, Esq., and Eric T. Moser, Esq., at
Kirkpatrick & Lockhart LLP, represent the Debtors in their
restructuring efforts.  (DII & KBR Bankruptcy News, Issue No. 19;
Bankruptcy Creditors' Service, Inc., 215/945-7000)


ENRON: Court Okays CrossCountry Sale to Southern Union/GE Comm'l.
-----------------------------------------------------------------
The U.S. Bankruptcy Court for the Southern District of New York
issued a Final Sale Order approving the Purchase Agreement, as
amended, between CCE Holdings, LLC, a joint venture of Southern
Union and GE Commercial Finance's Energy Financial Services, and
Enron Corp. and its affiliates to acquire 100% of the equity
interests of CrossCountry Energy, LLC. The total transaction is
valued at $2.45 billion, including the assumption of certain
consolidated debt. The acquisition is subject to satisfaction of
certain approvals and other closing conditions and is expected to
close no later than mid-December.

Thomas F. Karam, President and Chief Operating Officer of Southern
Union, stated, "We are happy to have finally reached the end of
the auction process. Now the real effort begins as we work to
close and then successfully integrate the acquisition. We very
much look forward to working with the CrossCountry team to operate
these superior assets. We are equally delighted to have such a
strong equity partner as GE Commercial Finance."

"This transaction is a great illustration of our strategy to
invest in quality energy assets, from wellhead to wall socket,"
said Alex Urquhart, President and Chief Executive Officer of GE
Commercial Finance's Energy Financial Services business.
"Acquiring this interest in CrossCountry with Southern Union also
demonstrates our commitment to supporting leading companies in the
industry, across the entire energy spectrum."

CrossCountry holds interests in and operates Transwestern Pipeline
Company, Citrus Corp. and Northern Plains Natural Gas Company -
which make up Enron's North American interstate natural gas
pipeline system. The pipeline system owned or operated by
CrossCountry is comprised of approximately 9,700 miles of pipeline
and approximately 8.6 Bcf/d of natural gas capacity.

      About GE Commercial Finance Energy Financial Services

Based in Stamford, Conn., GE Commercial Finance's Energy Financial
Services (EFS) provides enterprise financial solutions to the
global energy industry from wellhead to wall socket. EFS's more
than 200 professionals provide financial products that span the
capital structure, including structured equity, leveraged leasing,
partnerships, project finance and broad-based commercial finance.
GE Commercial Finance is a global, diversified financial services
company with assets of over US$220 billion. GE (NYSE:GE) is a
diversified technology, media and financial services company
dedicated to creating products that make life better. GE operates
in more than 100 countries and employs more than 300,000 people
worldwide. For more information, visit http://www.ge.com/

                  About Southern Union Company

Southern Union Company, headquartered in Wilkes-Barre,
Pennsylvania, is engaged primarily in the transportation and
distribution of natural gas. Through its Panhandle Energy
subsidiary, the Company owns and operates Panhandle Eastern Pipe
Line Company, Trunkline Gas Company, Sea Robin Pipeline Company,
Trunkline LNG Company and Southwest Gas Storage Company.
Collectively, the pipeline assets operate more than 10,000 miles
of interstate pipelines that transport natural gas from the Gulf
of Mexico, South Texas and the Panhandle regions of Texas and
Oklahoma to major U.S. markets in the Midwest and Great Lakes
region. Trunkline LNG, located in Lake Charles, Louisiana, is the
nation's largest liquefied natural gas import terminal. Through
its local distribution companies, Missouri Gas Energy, PG Energy
and New England Gas Company, Southern Union also serves nearly one
million natural gas end-user customers in Missouri, Pennsylvania,
Massachusetts and Rhode Island. For more information, visit
http://www.southernunionco.com/

Headquartered in Houston, Texas, Enron Corporation is in the midst
of restructuring various businesses for distribution as ongoing
companies to its creditors and liquidating its remaining
operations. Before the company agreed to be acquired, controversy
over accounting procedures had caused Enron's stock price and
credit rating to drop sharply. The Company filed for chapter 11
protection on December 2, 2001 (Bankr. S.D.N.Y. Case No. 01-
16033). Judge Gonzalez confirmed the Company's Modified Fifth
Amended Plan on July 15, 2004, and numerous appeals followed.
Martin J. Bienenstock, Esq., and Brian S. Rosen, Esq., at Weil,
Gotshal & Manges, LLP, represent the Debtors in their
restructuring efforts.


FEDERAL-MOGUL: Environmental Claims Must be Filed by October 15
---------------------------------------------------------------
Federal-Mogul Corporation and its debtor-affiliates continue to
engage in extensive settlement negotiations with the United States
Environmental Protection Agency and the Federal Natural Resource
Trustees.  The parties have made further substantial progress
towards a global settlement.  As of August 18, 2004, the parties
have resolved numerous issues arising out of the environmental
claim held by the EPA and have agreed on a variety of terms with
respect to the global settlement.  The EPA continues to review the
terms of the global settlement and expects to begin the process of
attempting to obtain the necessary internal approval soon.  The
parties also continue to address a number of issues arising out of
the environmental claims held by certain state governments to
determine their participation in the global settlement.

In the interest of resolving the issues and reaching a global
settlement, the Debtors agree to extend until October 15, 2004, at
4:00 p.m., prevailing Eastern Time, the EPA's deadline to file
claims.  All other provisions of the Bar Date Order will remain in
full force and effect.

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


FRONTIER FINANCING: Moody's Withdraws Pref. Securities' C Rating
----------------------------------------------------------------
Moody's Investors Service has withdrawn its trust preferred
securities rating on Frontier Financing Trust -- a special purpose
capital funding vehicle of Frontier Insurance Group, Inc.
Interest payments on the company's trust preferred securities,
rated C prior to withdrawal, have been in deferral since April of
2000.  The rating has been withdrawn because of the runoff status
of the group's insurance subsidiaries.  Please refer to Moody's
Withdrawal Policy on http://moodys.com/


GE COMMERCIAL: Fitch Puts Low-B Ratings on Six Certificate Classes
------------------------------------------------------------------
Fitch Ratings affirms GE Commercial Mortgage Corporation, series
2003-C2 as follows:

   -- $56 million class A-1 at 'AAA';
   -- $165 million class A-2 at 'AAA';
   -- $54.3 million class A-3 at 'AAA';
   -- $406.1 million class A-4 at 'AAA';
   -- $281.2 million class A-1A at 'AAA';
   -- Interest-only class X-1 at 'AAA';
   -- Interest-only class X-2 at 'AAA';
   -- $35.5 million class B at 'AA';
   -- $14.8 million class C at 'AA-';
   -- $26.6 million class D at 'A';
   -- $14.8 million class E at 'A-'
   -- $14.8 million class F at 'BBB+';
   -- $14.8 million class G at 'BBB';
   -- $14.8 million class H at 'BBB-';
   -- $19.2 million class J at 'BB+';
   -- $7.4 million class K at 'BB';
   -- $8.8 million class L at 'BB-';
   -- $4.4 million class M at 'B+';
   -- $7.4 million class N at 'B';
   -- $2.9 million class O at 'B-';
   -- $3.7 million class BLVD-1 at 'A';
   -- $2.5 million class BLVD-2 at 'A-';
   -- $4.5 million class BLVD-3 at 'BBB+';
   -- $3.5 million class BLVD-4 at 'BBB';
   -- $8 million class BLVD-5 at 'BBB-'.

Fitch does not rate $20.7 million class P certificates.

The rating affirmations reflect the stable pool performance and
minimal paydown since issuance.  As of the August 2004
distribution date, the pool's aggregate certificate balance has
decreased 1.16% to $1.19 million from $1.21 million at issuance.
To date, there have been no loan payoffs or realized losses within
the transaction.  There are also no delinquent or specially
serviced loans.

Bank of America, the master servicer, collected year-end 2003
operating statements for 93% of the transaction.  The YE 2003
weighted average debt service coverage ratio -- DSCR -- is 1.90
times (x), compared to 1.95x at issuance for the same loans.

Fitch has reviewed credit assessments of DDR Portfolio (6.25%),
Boulevard Mall (4.02%), and Wellbridge Portfolio (1.90%) loans.
The loans have YE 2003 Fitch stressed DSCR of 1.85x, 3.31x, and
2.14 respectively.

The DSCR for each loan is calculated using borrower provided net
operating income less required reserves divided by debt service
payments based on the current balance using a Fitch stressed
refinance constant.  The Wellbridge Portflio's DSCR reflects the A
and B Notes.  Based on their stable to improved performance, all
loans maintain investment grade credit assessments.


GREENPOINT CREDIT: Fitch Shaves Ratings on Two Classes & Junks One
------------------------------------------------------------------
Fitch Ratings has downgraded eleven classes (approximately $460.7
million in outstanding principal) and affirmed six classes
(representing approximately $274.8 million in outstanding
principal) from five Greenpoint Credit Manufactured Housing
Trusts.

The negative rating actions are a result of poor performance on
the underlying collateral.  Losses to date have significantly
exceeded Fitch's initial expectations.

The loans are serviced by Greenpoint Credit, a subsidiary of
Greenpoint Financial Corp. currently rated 'BBB' by Fitch.
Greenpoint exited the manufactured housing -- MH -- lending
business in early 2002 but has continued to service its loan
portfolio.  In late 2002 and early 2003, Greenpoint's MH servicing
operation was restructured and as a result a number of servicing
functions were affected.  Most notably, a centralized collection
center was established in Atlanta, Georgia.

Since exiting the MH business, Greenpoint has relied heavily on
the wholesale channel and has recently seen recoveries of
approximately 15-20% for most transactions.  Like many
manufactured housing servicers, Greenpoint relies heavily on
modifications as a loss mitigation tool.  Greenpoint is currently
modifying approximately 2% of its portfolio on a monthly basis.
While Fitch believes modifications can help maintain cash flow on
a low recovery asset, Fitch expects the use of modifications to
keep default rates higher than they would have been otherwise as
the collateral seasons.

Series 1999-5:

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

Series 2000-1:

   -- Classes A-2 affirmed at 'AAA';
   -- Class A-3 is downgraded to 'A' from 'AA';
   -- Classes A-4 and A-5 downgraded to 'BBB' from 'A+';
   -- Class M-1 downgraded to 'BB-' from 'BBB-';
   -- Class M-2 downgraded to 'C' from 'CCC'.

Series 2000-3:

   -- Class I A downgraded to 'BBB-' from 'A-';
   -- Class I M-1 downgraded to 'B' from 'BB+';
   -- Class I M-2 downgraded to 'CC' from 'CCC'.

Series 2001-2 Group 1:

   -- Class I-A-1 affirmed at 'AAA'.

Series 2001-2 Group 2:

   -- Class II-A-1 affirmed at 'AAA'.


GOSHAWK RIDGE DEV'T: Case Summary & 5 Largest Unsecured Creditors
-----------------------------------------------------------------
Debtor: Goshawk Ridge Development, Ltd.
        PO Box 6823
        Incline Village, Nevada 89450

Bankruptcy Case No.: 04-52701

Chapter 11 Petition Date: September 10, 2004

Court: District of Nevada (Reno)

Debtor's Counsel: Stephen R. Harris, Esq.
                  Belding, Harris & Petroni, Ltd.
                  417 West Plumb Lane
                  Reno, Nevada 89509
                  Tel: (775) 786-7600
                  Fax: (775) 786-7764

Estimated Assets: $1 Million to $10 Million

Estimated Debts: $1 Million to $10 Million

Debtor's 5 Largest Unsecured Creditors:

    Entity                    Nature Of Claim       Claim Amount
    ------                    ---------------       ------------
Distinctive Homes                                       $250,000
International LLC
PO Box 1370
Zephyr Cove, Nevada 89448

Laurence C. and               Loan                      $200,000
Carla T. Lusvardi

Falcon Capital LLC            Loan                       $51,569

Bradley Paul Elley            Legal Services             $21,677

James P. Borelli                                          $7,997


HANGER ORTHOPEDIC: Lenders Agree to Modify 5 Key Loan Covenants
---------------------------------------------------------------
As previously reported in the Troubled Company Reporter, Hanger
Orthopedic Group, Inc., entered into a Third Amendment to the
Amended and Restated Credit Agreement dated as of October 3, 2003,
under which it obtains working capital and long-term financing.
General Electric Capital Corporation serves as the Administrative
Agent under the loan agreement for a consortium of unidentified
lenders that includes GECC.

In exchange for an amendment fee equal to 0.20% of the Lenders
outstanding commitments, more than 80% of the lenders approved the
Third Amendment.

The Third Amendment requires Hanger to comply with five financial
covenants:

     A.  Hanger agrees to limit Capital Expenditures to:

         For the Period                    CapEx Limit
         --------------                    -----------
         Fiscal 2004                       $19,375,000
         Fiscal 2005                       $17,500,000
         Fiscal 2006                       $17,500,000
         Fiscal 2007                       $17,500,000
         Fiscal 2008                       $17,500,000

     B.  Hanger promises that it will not permit its
         Consolidated Interest Coverage Ratio to be less than:

            At the End of Each            Maximum Interest
          Fiscal Quarter Between           Coverage Ratio
          ----------------------          ----------------
         09/30/2003 and 06/30/2004           2.25:1.00
         09/30/2004 and 06/20/2005           2.00:1.00
         09/30/2005 and 12/31/2005           2.25:1.00
         03/31/2006 and 12/31/2006           2.50:1.00
         03/31/2007 and 12/31/2007           2.75:1.00
         03/31/2008 and thereafter           3.00:1.00

     C.  Hanger will not permit its Leverage Ratio to exceed:

              For the Fiscal                  Maximum
              Quarter Ending              Leverage Ratio
              --------------              --------------
                12/31/2003                   4.25:1.00
                03/31/2004                   4.75:1.00
                06/30/2004                   5.00:1.00
                09/30/2004                   6.00:1.00
                12/31/2004                   6.00:1.00
                03/31/2005                   6.00:1.00
                06/30/2005                   5.75:1.00
                09/30/2005                   5.00:1.00
                12/31/2005                   4.75:1.00
                03/31/2006                   4.50:1.00
                06/30/2006                   4.25:1.00
                09/30/2006                   4.25:1.00
                12/31/2006                   4.25:1.00
                03/31/2007                   4.00:1.00
                06/30/2007                   4.00:1.00
                09/30/2007                   4.00:1.00
                12/31/2007                   4.00:1.00
                03/31/2008                   3.50:1.00
                06/30/2008                   3.50:1.00
                09/30/2008                   3.50:1.00
                12/31/2008                   3.50:1.00

     D.  Hanger promises that it will not permit its Senior
         Secured Leverage Ratio to be greater than:

                                              Maximum
              For the Fiscal              Senior Secured
              Quarter Ending              Leverage Ratio
              --------------              --------------
                12/31/2003                   2.50:1.00
                03/31/2004                   2.50:1.00
                06/30/2004                   2.50:1.00
                09/30/2004                   2.80:1.00
                12/31/2004                   2.80:1.00
                03/31/2005                   2.80:1.00
                06/30/2005                   2.80:1.00
                09/30/2005                   2.50:1.00
                12/31/2005                   2.50:1.00
                03/31/2006                   2.50:1.00
                06/30/2006                   2.50:1.00
                09/30/2006                   2.50:1.00
                12/31/2006                   2.50:1.00
                03/31/2007                   2.50:1.00
                06/30/2007                   2.50:1.00
                09/30/2007                   2.50:1.00
                12/31/2007                   2.50:1.00
                03/31/2008                   2.50:1.00
                06/30/2008                   2.50:1.00
                09/30/2008                   2.50:1.00
                12/31/2008                   2.50:1.00

     E.  Hanger promises that it will it will maintain a
         Fixed Charge Coverage Ratio of no less than:

                                             Minimum
              For the Fiscal               Fixed Charge
              Quarter Ending              Coverage Ratio
              --------------              --------------
                12/31/2003                   1.30:1.00
                03/31/2004                   1.30:1.00
                06/30/2004                   1.30:1.00
                09/30/2004                   1.10:1.00
                12/31/2004                   1.10:1.00
                03/31/2005                   1.10:1.00
                06/30/2005                   1.10:1.00
                09/30/2005                   1.20:1.00
                12/31/2005                   1.20:1.00
                03/31/2006                   1.20:1.00
                06/30/2006                   1.20:1.00
                09/30/2006                   1.20:1.00
                12/31/2006                   1.20:1.00
                03/31/2007                   1.20:1.00
                06/30/2007                   1.30:1.00
                09/30/2007                   1.30:1.00
                12/31/2007                   1.30:1.00
                03/31/2008                   1.30:1.00
                06/30/2008                   1.30:1.00
                09/30/2008                   1.30:1.00
                12/31/2008                   1.30:1.00

Headquartered in Bethesda, Maryland, Hanger Orthopedic Group, Inc.
(NYSE: HGR) is the world's premier provider of orthotic and
prosthetic patient-care services. Hanger is the market leader in
the United States, owning and operating 614 patient-care centers
in 44 states and the District of Columbia, with 3,385 employees
including 1,016 practitioners as of June 30, 2004.  Hanger is
organized into four business segments.  The two key operating
units are patient-care which consists of nationwide orthotic and
prosthetic practice centers and distribution which consists of
distribution centers managing the supply chain of orthotic and
prosthetic componentry to Hanger and third party patient-care
centers.  The third is Linkia which is the first and only managed
care organization for the orthotics and prosthetics industry. The
fourth segment is Innovative Neutronics which introduces emerging
neuromuscular technologies developed through independent research
in a collaborative effort with industry suppliers worldwide.

                          *     *     *

Moody's Investors Service recently cut Hanger Orthopedic Group,
Inc., ratings one notch to:

   * $100 Million Revolver due 2007 -- B2

   * $150 Million Term Loan B due 2009 -- B2

   * $200 Million 10.375% Senior Notes due 2009 -- B3

   * $53 Million (accreted value) 7% Redeemable Preferred Stock
     due 2010 -- Caa2

   * Senior Implied Rating -- B2

   * Senior Unsecured Issuer Rating -- Caa1

and says the outlook remains negative notwithstanding the Third
Amendment to the Credit Agreement.

Moody's ratings reflect:

   * the deterioration in performance,
   * the company's high leverage,
   * the company's high reliance on government funds and
     Medicare's recent decision to freeze rates for three years,
   * pricing pressure from large commercial payors,
   * a competitive environment, and
   * weakening industry utilization and growth trends.

Moody's concerns over these issues are compounded by the number of
other problems that have arisen at the company recently, including
billing discrepancies at the West Hempstead center and the
accounting error related to uncollectible receivables recently
uncovered.

Credit strengths recognized include:

   * the company's dominant market position and competitive
     advantages including the ability to obtain greater purchase
     discounts,

   * national contracting capability and access to new technology,

   * the company's conservative operations-focused strategy and
     minimal reliance on acquisitions,

   * the geographic diversification of revenues through over 600
     patient care centers, and

   * positive long term demographics and industry growth trends.

Moody's also took into consideration the potential for significant
sales and EBITDA growth in 2005 related to the company's Linkia
subsidiary.

The negative outlook reflects the risk that near-term fundamentals
for the industry may remain weak and may lead to a continued
decline in performance for a longer period that the company is
predicting.  The negative outlook also incorporates Moody's
concern that the projected turnaround in Hanger's performance
depends highly on the company's ability to grow a new business.
There is considerable uncertainty over whether the company will be
able to sign up additional contracts (at reasonable prices) and
generate the profitability and cash flow anticipated.

If Hanger is unsuccessful in starting up Linkia and other sales
initiatives fail to generate improved same store growth, Moody's
may consider further downgrading the company's ratings.  Moody's
notes that while certain targeted near-term expense reductions may
boost profitability, such measures can only temporarily boost
performance and thus may not prevent a downgrade.


HAYES LEMMERZ: Asks Court to Deny GE Capital to File Sur-Reply
--------------------------------------------------------------
Thomas G. Macauley, Esq., at Zuckerman Spaeder, LLP, in
Wilmington, Delaware, relates that General Electric Capital
Corporation filed two applications for allowance and payment of an
$8 million administrative expense in 2003 in the chapter 11 cases
of Hayes Lemmerz International, Inc. and its debtor-affiliates and
subsidiaries.  GE Capital alleged that each of the 51 machines
subject to the equipment leases rejected by the Debtors and two
expired leases sustained a "Casualty Occurrence" giving rise to
the Debtors' obligation to pay the contractual "stipulated loss
value" for each machine.

Mr. Macauley tells the U.S. Bankruptcy Court for the District of
Delaware that 25 of the machines were in operating condition on
the Petition Date and on the date they were returned to GE
Capital.   Nine additional machines that required repair on the
Petition Date suffered no further damage postpetition.  Therefore,
there is no evidence that a Casualty Occurrence took place on 34
machines after the Petition Date.

              GE Capital Seeks Leave to File Sur-Reply

Julianne E. Hammond, Esq., at Blank Rome, LLP, in Wilmington,
Delaware, points out that the Debtors attached seven inspection
reports as exhibit to their Brief in support of their Summary
Judgment Motion without:

    -- the accompanying photographs;

    -- any foundational testimony by the inspectors; and

    -- any evidence regarding the purpose of the reports or the
       circumstances surrounding the making of the reports.

The Debtors assert that the "inspection reports relied on by
Meritage and General Electric Capital Corporation" together with
alleged deposition testimony of Ed Czosek, a Meritage salesman,
provide "compelling evidence" that 25 machines could not have
suffered a Casualty Occurrence.  According to Mr. Czosek, "the
inspection reports on certain machines indicate that the machines
were not irreparably damaged or permanently rendered unfit for
use."

Ms. Hammond notes that the Debtors offered Mr. Czosek's testimony
without accompanying foundational evidence that:

    (1) the purpose of the inspections was to determine whether or
        not the machines suffered a Casualty Occurrence within the
        meaning of the Master Lease Agreement;

    (2) the inspection report form was designed to report whether
        or not the machines suffered a Casualty Occurrence;

    (3) the inspectors were asked to make a determination whether
        or not the machines suffered a Casualty Occurrence;

    (4) it was Mr. Czosek's job to determine whether or not the
        machines suffered a Casualty Occurrence;

    (5) Mr. Czosek was qualified to determine whether or not the
        machines suffered a Casualty Occurrence; or

    (6) Mr. Czosek was ever asked by GE Capital or anyone else to
        determine whether or not the machines suffered a Casualty
        Occurrence.

The Debtors contend that the inspection reports are admissible
against GE Capital as "party admissions" pursuant to Rule
801(d)(2) of the Federal Rules of Evidence, because either:

    (1) GE Capital adopted and acted on the contents of inspection
        reports; or

    (2) the inspection reports are "statements by [GE Capital's]
        agent or servant concerning a matter within the scope of
        the agency or employment, made during the existence of the
        relationship."

Ms. Hammond argues that the inspectors hired by Meritage, not GE
Capital, were not asked to make and did not make in their reports
any recommendations to GE Capital, whereby GE Capital could be
said to have "adopted and acted upon" their recommendations and
therefore accepted the truth of the contents of the report.
Moreover, the Debtors identified not a single instance in the
record where GE Capital relied on any one of the inspection
reports.

To the extent that the Court determines that the inspection
reports offered by the Debtors are admissions by GE Capital, GE
Capital retracts and repudiates the alleged Admissions.  Ms.
Hammond maintains that GE Capital is entitled to offer its
explanation regarding the circumstances surrounding the making of
the reports.  In that regard, testimony from the individual
inspectors and evidence offered by GE Capital regarding the sales
process and the interaction between Meritage and GE Capital are
all relevant to the Court's factual evaluation of the alleged
admissions.

Ms. Hammond avers that the issue is whether or not the Debtors'
postpetition use and lack of proper maintenance and repairs
rendered the machines worn out, irreparably damaged, or
permanently unfit for use.  Evidence that the machines were
"operating" at some point in time or allegedly were "in operating
condition" does not speak to whether or not the machine later
suffered a Casualty Occurrence.

Ms. Hammond also avers that the price that a third party buyer is
willing to pay for a given machine in an arm's-length transaction,
after personally inspecting the machine, is the best evidence of
the condition of that machine.  GE Capital presented evidence of
the extensive sales and marketing process conducted by GE Capital
and Meritage with respect to each of the machines, including the
expert testimony of Thomas Hazelhurst regarding what each of the
machines should have been worth if each had been properly
maintained and repaired and had been in reasonable condition for
its vintage.

The Debtors have not presented any evidence of value to rebut the
evidence presented by GE Capital.  Instead, the Debtors
incorrectly contend that Mr. Hazelhurst's valuation testimony is
not relevant or probative because the valuation date allegedly is
tied strictly to the schedule rejection date.

Ms. Hammond contends that the Debtors are wrong in their claim
that if the machine was destroyed prepetition, the maintenance
obligation with respect to that machine did not "first" arise from
and after 60 days after the Petition Date as required by
Section 365(d)(10) of the Bankruptcy Code.

The legislative history to Section 365(d)(10) sheds light on the
purpose and intent of the use of the word "first":

    Sixty days after the order for relief, the debtor will have
    to perform all obligations under the equipment lease, unless
    the court holds a hearing and determines otherwise, with the
    burden on the debtor.  The word "first" as used in the section
    refers to payments and other obligations that initially become
    due more than 60 days after the order for relief.  The purpose
    of the reference is to make clear the intent that the
    provision does not affect payments originally due prior to the
    60 days before (sic) the order of relief.

If the Debtors wanted to avoid those obligations, with respect to
any machines they allegedly destroyed prepetition, they should
have rejected the lease schedules in the first 60 days of the
case.  With respect to the machines at issue, they did not.

Accordingly, GE Capital asks the Court to deny the Debtors'
request for partial summary judgment because the Debtors:

    -- have not carried their burden of proving that no genuine
       issues of fact remain for trial; and

    -- have failed to establish that they are entitled to judgment
       as a matter of law.

                Strike Debtors' Discovery Responses

GE Capital further asks Judge Walrath to strike the Debtors'
discovery responses as alleged evidence in support of the Summary
Judgment Motion.  The Discovery Responses are not properly
supported by affidavit testimony or any other testimony and
therefore are inadmissible hearsay pursuant to Rules 801 and 802
of the Federal Rules of Evidence when offered by the Debtors.
The Discovery Responses also lack proper foundation for
admissibility pursuant to Rule 901 of the Federal Rules of
Evidence.

Ms. Hammond points out that the affidavit attached to the
Debtors' Discovery Responses does no more than confirm:

    (1) that the affiant lacks personal knowledge of the facts
        stated in the Discovery Responses; and

    (2) the Discovery Responses consist of a multitude of hearsay
        statements by unidentified "authorized employees and
        counsel for Debtors".

Pursuant to Rule 56(e) of the Federal Rules of Civil Procedure,
"[s]upporting and opposing affidavits shall be made on personal
knowledge, shall set forth such facts as would be admissible in
evidence, and shall show affirmatively that the affiant is
competent to testify to the matters stated therein."

              Debtors Object to GE Capital's Sur-Reply

Thomas G. Macauley, Esq., at Zuckerman Spaeder, LLP, in
Wilmington, Delaware, reiterates that the Debtors submitted ample
deposition testimony and affidavits of individuals who have first-
hand knowledge of the condition of the machines.  The testimony
conclusively establishes that 25 machines were in operating
condition on their return to GE Capital and that the prepetition
condition of another nine did not change after the filing of the
bankruptcy.  The Debtors also presented reports of inspections
commissioned by GE Capital, which show that the machines were in
production or needed only minor work.

Mr. Macauley points out that GE Capital has come forward with
nothing to dispute any of the compelling evidence.  Rather, its
strategy is to exclude the evidence.  GE Capital's request to file
a sur-reply is part of that strategy since its proposed brief
deals primarily with the admissibility of the inspection reports.
In sum, the proposed sur-reply merely supplements GE Capital's
Opposition Brief, which is not the purpose of a sur-reply.

If however the Court allows the Sur-reply and determines that it
requires a written response from the Debtors before ruling on the
Debtors' Summary Judgment Motion, the Debtors would like the
opportunity to correct seriously misleading representations made
in the proposed Sur-reply.

Mr. Macauley further points out that GE Capital failed to inform
that it hired Meritage to perform the inspections.  GE Capital
does not mention to the Court that there is a contract between
Meritage and GE Capital that requires Meritage to inspect the
equipment on GE Capital's request.  GE Capital also ignores the
testimony of the GE Capital and Meritage witnesses on the role of
the inspection reports.

Thus, the Debtors ask the Court to deny GE Capital's request to
file a sur-reply. (Hayes Lemmerz Bankruptcy News, Issue No. 54;
Bankruptcy Creditors' Service, Inc., 215/945-7000)


IMMUNE RESPONSE: First HIV Patients Enrolled in New Int'l Trial
---------------------------------------------------------------
The Immune Response Corporation (Nasdaq: IMNR), a
biopharmaceutical company dedicated to becoming a leading immune-
based therapy company in HIV and multiple sclerosis, says the
first patients have been enrolled at the Canadian site in its
initial clinical trial investigating IR103, the Company's newest
product candidate in development for the treatment of HIV. This
trial, with active sites in the United Kingdom and Canada, will
represent the first human experience with IR103, which combines
the Company's patented HIV-1 Immunogen with Amplivax(TM), an
immunostimulatory oligonucleotide adjuvant.

"Our preclinical research has shown results that suggest the
combination of our HIV-1 Immunogen with Amplivax(TM) in IR103
elicits a strong immune response. We believe this type of response
will be replicated in human subjects by IR103. We are delighted to
advance IR103 into its first clinical study formally initiating a
development plan designed to carefully examine this important
product candidate," said John N. Bonfiglio, Ph.D., Chief Executive
Officer of The Immune Response Corporation. "Further, the UK
Medicines and Healthcare Products Regulatory Agency (MHRA) has
cleared our protocol and we plan to be enrolling patients in the
UK shortly."

The two-part, nine-arm, randomized, single-blind, controlled,
multi-center phase I/II study began this summer and will run for
approximately 28 weeks with 80 patients enrolled. The primary
objective of this study is to evaluate safety and bioactivity or
the ability to generate HIV-specific immune responses to IR103,
with or without Incomplete Freund's Adjuvant (IFA), in HIV
patients on HAART (highly active anti-retroviral therapy). Ability
to generate HIV-1 specific immune responses is thought to be an
important indicator of clinical utility.

For more information about enrolling in this trial please contact
The Immune Response Corporation at 760-431-7080 in the United
States.

Amplivax(TM) was developed by Hybridon, Inc. and has been licensed
to The Immune Response Corporation.

As reported in the Troubled Company Reporter on September 10,
2004, Immune Response and NovaRx Corporation, a privately-held
company dedicated to developing therapeutic vaccines to treat
cancer, signed a licensing agreement to transfer all of The Immune
Response Corporation's in-licensed development and marketing
rights of the Sidney Kimmel Cancer Center's -- SKCC -- patent
portfolio for cancer cell line vaccines to NovaRx.

In addition, NovaRx agreed to pay The Immune Response Corporation
the total sum of $1,050,000, including an upfront fee and a final
payment due on or before August of 2007.  The Immune Response
Corporation had previously licensed the cancer cell vaccine
technology from SKCC in 1994.

                About The Immune Response Corporation

The Immune Response Corporation is a biopharmaceutical company
dedicated to becoming a leading immune-based therapy (IBT) company
in HIV and multiple sclerosis (MS). The Company's HIV products are
based on its patented whole-killed virus technology, co-invented
by Company founder Dr. Jonas Salk to stimulate HIV immune
responses. Remune(R), currently in Phase II clinical trials, is
being developed as a first-line treatment for people with early-
stage HIV. The Company has initiated development of a new IBT,
IR103, which incorporates a second-generation immunostimulatory
oligonucleotide adjuvant.

The Immune Response Corporation is also developing an IBT for MS,
NeuroVax(TM), which is currently in Phase II and has shown
potential therapeutic value for this difficult-to-treat disease.

                         *     *     *

                   Going Concern Uncertainty

In its Form 10-Q for the quarterly period ended June 30, 2004,
filed with the Securities and Exchange Commission, The Immune
Response Corporation reports:

"The Company has incurred net losses since inception and has an
accumulated deficit of $319,211,000 as of June 30, 2004. The
Company will not generate meaningful revenues in the foreseeable
future.

"These factors, among others, raised substantial doubt about the
Company's ability to continue as a going concern.  Our independent
certified public accountants, BDO Seidman, LLP, indicated in their
report on the 2003 consolidated financial statements that there is
substantial doubt about our ability to continue as a going
concern."


IMPERIAL SCHRADE CORP: Case Summary & Largest Unsecured Creditors
-----------------------------------------------------------------
Debtor: Imperial Schrade Corporation
        7 Schrade Court
        Ellenville, New York 12428-0981

Bankruptcy Case No.: 04-15877

Type of Business: The Debtor manufactures and designs knives and
                  tools. See http://www.schradeknives.com/

Chapter 11 Petition Date: September 10, 2004

Court: Northern District of New York (Albany)

Debtor's Counsel: Charles J. Sullivan, Esq.
                  Hancock & Estabrook, LLP
                  1500 MONY Tower I
                  PO Box 4976
                  Syracuse, New York 13221-4976
                  Tel: (315) 471-3151
                  Fax: (315) 471-3167

Estimated Assets: $10 Million to $50 Million

Estimated Debts: $10 Million to $50 Million

Debtor's 20 Largest Unsecured Creditors:

    Entity                    Nature Of Claim       Claim Amount
    ------                    ---------------       ------------
Orange Imports                Trade Debt              $1,002,059
7084 Piedmont Drive
Rapidan, Virginia 22733

MVP Select Care               Health Insurance          $631,758
111 Liberty Street
Schenectady, New York 12305

Atchison Leather              Trade Debt                $205,160
Division of Berger Company

Tax Collector                 Property Taxes            $200,025

School Tax Collector          School Taxes              $185,809

Ernst & Young LLP             Services                  $124,364

Inland Paperboard &           Trade Debt                $113,525
Packaging, Inc.

Wagner, Davis & Gold, PC      Services                  $113,000

United Parcel Service         Services                   $95,474

Millard Wire Company          Trade Debt                 $93,774

Saidman Designlaw Group       Trade Debt                 $90,559

General Mills, Inc.           Trade Debt                 $84,750

P & B Woodworking Company     Trade Debt                 $84,259

Ray International Trading     Trade Debt                 $71,795
Company

Image Group, Inc.             Trade Debt                 $68,063

AK Steel                      Trade Debt                 $63,651

Global Point Technology       Trade Debt                 $58,358

Rosier Metalfinishing USA LLC                            $54,706

AIG Life Insurance            Trade Debt                 $53,662

Camillus Cutlery Company      Trade Debt                 $53,611


INNOVATIVE WATER: Taps James Edward Capital to Get More Financing
-----------------------------------------------------------------
Innovative Water & Sewer Systems, Inc., Ottawa, Ontario
(TSXV: IWS) engaged James Edward Capital Corporation to act as its
agent to conduct on its behalf a debt, quasi-equity, and equity
private placement financing for proceeds of $1 million to
$1.5 million.  Further particulars of the financing will be
announced once finalized by the Corporation and James Edward
Capital Corporation.  Proceeds from the financing will be used for
the development and marketing of the Corporation's business and
general working capital for operations.  The financing is subject
to certain conditions and approvals including the acceptance of
the TSX Venture Exchange.

Innovative Water & Sewer Systems, Inc., is incorporated under the
laws of Alberta.  The Company markets, designs and installs
communal water and wastewater systems.  The Company is focused on
marketing its Small Bore Sewer(TM) technology used in communal
wastewater systems.

Included in the Quartery Financial Report ended June 30, 2004 of
Innovative Water & Sewer Systems, Inc:

   "These consolidated financial statements have been prepared on
    the basis of accounting principles applicable to a going
    concern, which assumes that the Company will realize the
    carrying value of its assets and satisfy its obligations as
    they become due in the normal course of operations.  The
    Company has incurred a loss of $376,228 for the six months
    ended June 30, 2004 and has had losses during the last three
    years.  In addition, the Company generated negative cash flow
    from operations of $390,112 for the six months ended
    June 30, 2004 and has accumulated losses of $3,403,018 as of
    June 30, 2004.

    The Company's management has focused on sales growth of its
    communal water and wastewater systems, which involve initial
    design contracts possibly leading to full design/build
    contracts.  Currently, the Company has a number of design
    contracts and is in the pursuit of a number of design/build
    contracts.  The Company's revenue has not yet reached a level
    sufficient to finance current operating expenses due to the
    time delays and risks associated with customers obtaining
    project financing, as well as the required approvals on
    design/build contracts.

    All of the above factors raise doubt about the Company's
    ability to continue as a going concern.  Management's plans to
    address these issues include executing on existing customer
    contracts, continuing to grow revenue through new design/build
    contracts, minimizing operating expenses and consideration of
    obtaining additional equity financing.  The Company's ability
    to continue as a going concern is subject to management's
    ability to successfully implement these plans.  Failure to
    implement these plans could have a material adverse effect on
    the Company's position and results of operations and may
    result in ceasing operations.  The consolidated financial
    statements do not include adjustments that may be required if
    the assets are not realized and the liabilities settled in the
    normal course of operations."


INTERCEPT INC: Inks Acquisition Pact by Fidelity Nat'l Financial
----------------------------------------------------------------
InterCept, Inc., a leading provider of banking technology products
and services for financial institutions and other businesses
(Nasdaq: ICPT), signed a merger agreement with Fidelity National
Financial, Inc. (NYSE: FNF), a Fortune 500 provider of products
and outsourced services and solutions to financial institutions
and the real estate industry, pursuant to which FNF will acquire
InterCept for $18.90 per share.

"FNF is a financially strong, growing organization that will offer
great opportunities for our employees and customers," said
InterCept Chief Executive Officer John W. Collins. "As part of a
larger company with strong resources, InterCept will be able to
expand its ability to provide financial institutions with the
products and services they need to remain competitive in today's
marketplace. This transaction will enhance InterCept's position in
the marketplace and provide a strong foundation for future
growth."

"This is an exciting acquisition for FNF," said FNF Chairman and
Chief Executive Officer William P. Foley, II. "It continues our
strategy of building more significant critical mass in our
technology solutions for the domestic banking and credit union
marketplace and provides FNF with an incremental 425 core
processing customers and more than 700 additional item processing
customers. These relationships provide not only a valuable stream
of recurring revenue and earnings, but also significant revenue
opportunities including offering InterCept's ATM/EFT, item
processing and output solutions to FNF's existing client base, as
well as providing FNF mortgage, banking and data and information
products and services to InterCept's customers.

Under the terms of the definitive agreement, FNF has the option to
pay the $18.90 consideration in all cash or in a combination of
cash and FNF stock. If FNF elects the stock and cash consideration
option, InterCept shareholders will have the option to elect any
combination of cash and stock, subject to proration such that the
overall limitation for the consideration in the transaction will
be 75% cash and 25% in the form of FNF stock. The composition of
the $18.90 per share offer will be finalized in the proxy
statement that will be distributed prior to the InterCept
shareholder vote to approve the transaction. If FNF stock is
issued as consideration, it will be calculated using a trailing
ten-day average determined one day before the closing of the
transaction.

The board of directors of InterCept has approved the transaction.
Closing of the transaction is expected in the fourth quarter of
2004, subject to approval by InterCept shareholders and customary
regulatory and other conditions. Jefferies & Company, Inc. acted
as financial advisor to InterCept.

In light of the merger agreement, InterCept has rescheduled its
annual shareholders meeting to November 8, 2004. At that meeting,
shareholders of record as of September 15, 2004 will vote on the
merger and for the election of directors of InterCept. If the
merger is approved and closed, however, the directors elected at
the annual meeting will not take office.

                        About InterCept

InterCept provides innovative technology products and services to
the financial industry, including core processing, check imaging
and item processing, electronic funds transfer, debit card
processing, communications management and related products and
services. The company serves over 2,000 clients nationwide and is
a leading provider of check imaging solutions with over 30 fully
image-enabled processing centers from coast to coast. For more
information about InterCept, Inc. (Nasdaq: ICPT), visit
http://www.intercept.netemail info@intercept.net or call
770.248.9600.

                          *     *     *

                Liquidity and Capital Resources

In its Form 10-Q for the quarterly period ended June 30, 2004,
filed with the Securities and Exchange Commission, InterCept, Inc.
reports:

"Since our incorporation, we have financed our operations and
capital expenditures through cash from operations, borrowings from
banks and sales of our common and preferred stock. In the second
half of 2003, we enhanced our liquidity and capital resources by:

   -- obtaining a $60 million three-year credit facility from Bank
      of America,

   -- issuing shares of Series A preferred stock for $10 million,
      and

   -- obtaining $12 million in lease financing from GE Capital.

"As of July 25, 2004, the outstanding balance on our credit
facility was $13.5 million. We have no off-balance sheet
arrangements. We believe that borrowings under our Bank of America
facility, funds provided by operations and our GE Capital lease
financing will be sufficient to meet our anticipated capital
expenditures and liquidity requirements for at least the next 12
months as well as the longer term.

"In connection with our sale of our merchant services division, we
received a $793,749 note from Media Billing that matured on March
30, 2004 and is now in default. Media Billing also defaulted in
its obligation to obtain a release of a $3.0 million letter of
credit held by First Data that we had obtained for the benefit of
iBill. First Data subsequently drew on the letter of credit in
full. In addition, the sale price of iBill was subject to a final
purchase price adjustment based on a determination of its working
capital on the closing date. On June 18, 2004, according to the
terms of the purchase agreement, we notified Media Billing of an
$827,000 purchase price adjustment in our favor. Consequently,
Media Billing owes us more than $4.6 million that we are seeking
to collect.

"Cash and cash equivalents were $11.5 million at June 30, 2004.
Short-term investments with a maturity of one year or less were
$122,000 at June 30, 2004. Net cash provided by operating
activities was $328,000 and $7.3 million for the six months ended
June 30, 2004, and June 30, 2003, respectively. The decrease in
the net cash provided by operating activities was primarily
attributable to the sale of our merchant services division."


INTERSTATE BAKERIES: Gets Bank Commitment to Continue Funding
-------------------------------------------------------------
Interstate Bakeries Corporation (NYSE:IBC) says that, under a
further amendment to its revolving credit facility, it has
received a commitment from its bank group that clarifies its
ability to continue borrowing while it addresses the various
issues that delayed the filing of its Fiscal 2004 Form 10-K with
the Securities and Exchange Commission.

Under the amendment and subject to certain conditions, the Company
will have up to $255 million of availability on its revolving
credit facility. Currently, there is $230 million outstanding
under the revolving credit facility including the aggregate amount
of outstanding letters of credit. Pursuant to the amendment,
continued borrowings from and after September 26 require approval
by two-thirds of the bank group.

"We are extremely pleased by the continued support of our bank
group," said James R. Elsesser, chief executive officer of IBC.
"The Company is continuing to sort through the issues raised in
its August 30, 2004, news release with respect to its financial
reporting systems. Our goal is to be able to file our Fiscal 2004
Form 10-K by the September 26 deadline."

The amendment provides a permanent increase of 0.50 percent in the
interest rate on borrowings under the credit facility, with
interest to be paid monthly. The Company's credit facility
requires it to:

   -- deliver to the banks its financial statements and related
      audit opinion for Fiscal 2004 on or prior to September 26,
      2004;

   -- provide a weekly cash flow forecast for loans made after
      September 13, 2004; and

   -- provide calculations showing compliance with the financial
      covenants under the credit facility for loans made after
      September 20, 2004.

If the Company is not able to meet these conditions or receive
appropriate waivers from the bank group at any time prior to
September 26, 2004, or if the Company is not able to reach
appropriate agreements with its bank group with respect to
borrowing availability on and after September 26, 2004, it will
have to seek alternative financing. There can be no assurance that
IBC would be able to obtain alternative financing under such
circumstances and, if alternative financing is not available, the
Company will need to consider alternative courses of action that
are typically considered by companies in similar circumstances.

Interstate Bakeries Corporation is the nation's largest wholesale
baker and distributor of fresh baked bread and sweet goods, under
various national brand names, including Wonder, Hostess, Dolly
Madison, Baker's Inn, Merita and Drake's. The Company, with 55
bread and cake bakeries located in strategic markets from coast-
to-coast, is headquartered in Kansas City, Missouri.


INTERSTATE BAKERIES: Hires Miller Buckfire for Financial Advice
---------------------------------------------------------------
Interstate Bakeries Corporation (NYSE:IBC) has hired Miller
Buckfire Lewis Ying & Co., LLC to assist the Company in its
discussions with the bank group and to identify and evaluate
strategic alternatives. Miller Buckfire Lewis Ying is a nationally
recognized investment banking firm providing strategic and
financial advisory services in large-scale corporate
restructurings, mergers and acquisitions and privately placed
financing transactions.

In June, 2004, IBC disclosed irregularities in its accounting for
workers' compensation reserves. At that time, IBC said it would
increase those reserves by 40% and take record a $40 million
pretax charge. The Company has received notice from the Securities
and Exchange Commission that the SEC is conducting an informal
inquiry.  IBC's Audit Committee has retained the law firm of
Skadden, Arps, Slate, Meagher & Flom LLP to investigate the
Company's manner for setting its workers' compensation reserves
and other reserves. Last month, Interstate Bakeries named Ronald
B. Hutchison as its new Executive Vice President and Chief
Financial Officer.  Alvarez & Marsal is on board helping the
company sort out its financial reporting problems.

Interstate Bakeries Corporation is the nation's largest wholesale
baker and distributor of fresh baked bread and sweet goods, under
various national brand names, including Wonder, Hostess, Dolly
Madison, Baker's Inn, Merita and Drake's. The Company, with 55
bread and cake bakeries located in strategic markets from coast-
to-coast, is headquartered in Kansas City, Missouri.

                          *     *    *

As reported in the Troubled Company Reporter on September 3, 2004,
Moody's Investors Service downgraded Interstate Bakeries' senior
implied and senior secured ratings to Caa1 from B2.  The ratings
downgrade follows the company's announcement that it is further
delaying the filing of its fiscal 2004 (ending May 29, 2004) 10K
because implementation of new financial reporting systems in June
2004 has resulted in deficient information on performance since
the company's fiscal year end.  As a result, unless sufficient
information becomes available for analysis, the company's
independent auditors may issue a qualified opinion with the
company's fiscal 2004 audited financials.  If the company does not
file its 10K by September 26 or files a 10K with a qualified
opinion, the company would need to seek waivers from its debt
holders.

The downgrade reflects uncertainty about the company's financial
position and liquidity pending effective implementation of the new
financial reporting systems and filing of its FY04 10K, combined
with continued negative sales and earnings trends and tight
liquidity under bank covenants going forward.  The downgrade also
takes into account the risks associated with the company's process
of significantly restructuring its operations to reduce costs,
while, at the same time, operating in a very competitive business
environment with weak category demand trends, much better
resourced competitors, and tight liquidity.

Although there is significant uncertainty about the company's
financial position, the ratings outlook is stable, reflecting
Moody's view that, in the event of a default, the senior secured
credit facilities are largely supported by asset values.  However,
the company's challenges in generating adequate information to
effectively support an appropriate operational restructuring may
lead to negative ratings pressure, particularly if negative sales
and earnings trends persist or if restructuring initiatives fail
to sustain asset values. Given the near term liquidity
uncertainties and ongoing operational challenges that Interstate
Bakeries faces, an upgrade is unlikely over the medium term.

Moody's ratings actions for Interstate Bakeries are:

   * Senior Secured Revolver, maturing 2006 -- to Caa1 from B2;
   * Senior Secured Term Loan A, maturing 2006 -- to Caa1 from B2;
   * Senior Secured Term Loan B, maturing 2007 -- to Caa1 from B2;
   * Senior Implied -- to Caa1 from B2;
   * Unsecured Issuer Rating -- to Caa3 from B3.
   * Ratings Outlook -- Stable.


IRISH PUB RESTAURANTS: Releases List of 20-Largest Creditors
------------------------------------------------------------
Irish Pub Restaurants, Inc., operating a chain of Bennigan's
casual dining restaurants with locations in three states:
Massachusetts, New York and Connecticut, delivered a list of its
20-largest creditors to the Bankruptcy Court overseeing its
chapter 11 restrucutring (Bankr. D. Mass. Case No. 04-17339) file
Sept. 7, 2004:

Entity                        Nature Of Claim       Claim Amount
------                        ---------------       ------------
Rewards Network               Advertising & Loan        $250,000

CT Department of Rev.         Sales Tax                 $150,000

Bennigan's Franchising Co.    Franchise Royalties       $100,000

Advance Me                    Loans                      $70,000

MA Dept. of Revenue           Sales Tax                  $60,000

NY Dept. of Revenue           Sales Tax                  $50,000

MBM Food Corporation          Food Vendor                $50,000

Micro Fidelio                 Repair Vendor              $40,000

Metromedia Energy             Utility Bills              $25,000

Franchise Financial           Accounting Services        $25,000
Management

Katsirousbous Bros.                                      $20,865

All Energy                    Services                   $18,134

NSTAR Electric                Utility Bills              $10,000

Ingreselli & Rinaldi          Accounting Services         $9,000

Carioto Produce               Vendor                      $7,000

News America Marketing        Advertising & Loan          $7,000

Fowler Produce                Vendor                      $7,000

Edward Don & Co.                                          $6,000

Fleet Bank                    Line of Credit              $6,000

Suburban Services Corp.                                   $4,500


ISLAND DREAMS LLC: Case Summary & 20 Largest Unsecured Creditors
----------------------------------------------------------------
Debtor: Island Dreams, L. L. C.
        dba Nikki-Lee's Sports Pub & Grille
        2640 East Sunset Road
        Las Vegas, Nevada 89120

Bankruptcy Case No.: 04-19584

Type of Business: Sports Bar

Chapter 11 Petition Date: September 8, 2004

Court: District of Nevada (Las Vegas)

Judge: Bruce A. Markell

Debtor's Counsels: Michael J. Dawson, Esq.
                   515 South 3rd Street
                   Las Vegas, Nevada 89101
                   Tel: (702) 384-1777

Total Assets: $1,800,000

Total Debts: $5,192,987

Debtor's 20 Largest Unsecured Creditors:

    Entity                    Nature Of Claim       Claim Amount
    ------                    ---------------       ------------
SJR Enterprises, Inc.         Loan                    $2,137,268
c/o Frank A. Schrek, Esq.
300 South Fourth Street, # 1200
Las Vegas, Nevada 89101

Sun West Bank                 Loan                      $680,000
5830 West Flamingo Road
Las Vegas, Nevada 89103

Bank of Commerce              Loan                       $79,562

Piercy Bowler Taylor          Trade Debt                  $6,400

Sports Direct                 Trade Debt                  $5,197

US Food Service               Trade Debt                  $4,902

Get Fresh Sales               Trade Debt                  $3,621

Cintas Corporation            Trade Debt                  $3,363

Westco-Bakemark               Trade Debt                  $2,935

AICCO, Inc.                   Trade Debt                  $2,836

Brandcor Foods, Inc.          Trade Debt                  $2,748

Park 2000 Associates                                      $2,603

Anytime Plumbing, Inc.        Trade Debt                  $2,535

Desert Meats & Provisions     Trade Debt                  $2,502

Republic Services of          Trade Debt                  $2,380
Southern Nevada

Redi-Spuds of Nevada          Trade Debt                  $2,358

Nevada Beverage Company       Trade Debt                  $2,264

Concord Foods                 Trade Debt                  $2,262

Southern Wine & Spirits       Trade Debt                  $2,222

Summit Financial Resources    Trade Debt                  $2,045


KAISER ALUMINUM: Ferazzi Wants to Hire Haynes & Boone as Counsel
----------------------------------------------------------------
Anne M. Ferazzi, the proposed the legal representative for future
claimants with silica, coal tar pitch volatiles and excess
occupational noise claims, sought and obtained authority from the
United States Bankruptcy Court for the District of Delaware to
retain Haynes and Boone, LLP, as her counsel for corporate,
financial and documentation matters.

Haynes and Boone is an expert in matters of corporate law and
finance and has acted as counsel for various debtors, creditors
committees, and creditors in numerous other reorganization cases
particularly those involving mass torts.  Haynes and Boone's
attorneys have developed considerable expertise in matters that
Ms. Ferazzi believes will be important in prosecuting the Future
Silica Claimants' interests in the Debtors' case.

Haynes and Boone was involved in In re Fuller-Austin Insulation
Company, Inc., Case No. 98-2038-JJF, before the United States
District Court for the District of Delaware.  The firm later
served as general counsel to the Fuller-Austin Asbestos
Settlement Trust.

Steven A. Buxbaum, a partner at Haynes and Boone, represented the
Ad Hoc Committee of Asbestos Claimants in Fuller-Austin's Chapter
11 case, which is a mass tort pre-packaged Chapter 11 case.  Mr.
Buxbaum played an important role in the negotiation and
documentation of Fuller-Austin's plan of reorganization and the
resulting trust and claims resolution procedures.

Haynes and Boone will:

   (a) advise Ms. Ferazzi regarding the duties and standards
       applicable to her service as the Future Silica Claimants'
       Representative;

   (b) assist Ms. Ferazzi with respect to legal and factual
       matters relevant to any proceeding or hearing before the
       Court and in any action in any other court where her
       rights or interests may be litigated or affected;

   (c) assist in the review and analysis of the corporate
       structure of the Debtors, their intercompany contracts,
       agreements, and relationships, financing arrangements
       among the Debtors and with third parties, plan proposals
       regarding equity interests or financing arrangements, and
       pleadings, motions, answers, notices, orders, and reports
       that are required for Ms. Ferazzi to analyze and negotiate
       the proposed treatment of Future Silica Claimants and to
       assist the Court in the orderly administration of the
       Debtors' estate;

   (d) advise, consult with, and assist Ms. Ferazzi in her
       investigation of the acts, conduct, assets, liabilities
       and financial condition of the Debtors, the operation of
       their business and any other matter relevant to the case;

   (e) assist Ms. Ferazzi in the analysis of assets available
       for the satisfaction of future silica claims and the value
       of those assets and the number and value of the claims,
       and the application of the information to the evaluation
       of proposed treatment of future silica claims in any plan
       or plans of reorganization;

   (f) assist Ms. Ferazzi in the formulation and review of trust
       distribution procedures and other documents necessary to
       implement a plan of reorganization in the case;

   (g) render necessary advice, legal services and legal research
       as Ms. Ferazzi may require in connection with the case.

Haynes and Boone will be compensated at a fee commensurate with
their normal hourly rates, which range from $300 to $525 for
attorneys, paralegals and law clerks.  The firm will be reimbursed
for all out-of-pocket expenses.

Mr. Buxbaum and the other attorneys that will be most involved in
the case and their hourly rates are:

          Professional          Position           Rate
          ------------          --------           ----
          Steven A. Buxbaum     Partner            $450
          John R. Hohlt         Of Counsel          445
          James Simmons         Associate           305
          Jermaine L. Johnson   Paralegal           160

Mr. Buxbaum assures Judge Fitzgerald that Haynes and Boone does
not hold or represent an interest adverse to the Debtors' estates
and is a "disinterested person" as the term is defined in Section
101(14) of the Bankruptcy Code.

Headquartered in Houston, Texas, Kaiser Aluminum Corporation --
http://www.kaiseral.com/-- operates in all principal aspects of
the aluminum industry, including mining bauxite; refining bauxite
into alumina; production of primary aluminum from alumina; and
manufacturing fabricated and semi-fabricated aluminum products.
The Company filed for chapter 11 protection on February 12, 2002
(Bankr. Del. Case No. 02-10429).  Corinne Ball, Esq., at Jones,
Day, Reavis & Pogue, represent the Debtors in their restructuring
efforts. On September 30, 2001, the Company listed $3,364,300,000
in assets and $3,129,400,000 in debts. (Kaiser Bankruptcy News,
Issue No. 49; Bankruptcy Creditors' Service, Inc., 215/945-7000)


LIBERATE TECH: To Appeal Court Ruling Dismissing Bankruptcy Case
----------------------------------------------------------------
The U.S. Bankruptcy Court for the Northern District of California
has dismissed Liberate Technologies' (Pink Sheets: LBRTQ) Chapter
11 bankruptcy case. The court ruled that Liberate has cash well in
excess of its liabilities and is not otherwise entitled to
bankruptcy protection.

Liberate believes the bankruptcy laws and judicial precedent
support Liberate's filing and intends to appeal this ruling.
However, Liberate cannot predict the outcome or timing of the
appellate process. Unless the decision of the Bankruptcy Court is
reversed on appeal, Liberate will not be able to realize savings
or the other benefits of a Chapter 11 proceeding. As a result of
the dismissal of the bankruptcy case, Liberate will continue to be
liable for the lease payments on its former offices in San Carlos,
California.

"We firmly believe in our bankruptcy case and intend to vigorously
appeal," stated David Lockwood, Chairman and CEO of Liberate. "As
we have throughout this process, we will continue to operate our
business, marketing to new customers, and providing ongoing
support to existing customers. The appeals process will continue
in parallel with our plans to grow our business and to increase
shareholder value."

As reported in the Troubled Company Reporter on July 12, 2004,
Liberate Technologies filed a voluntary petition under Chapter 11
of Title 11 of the United States Code on April 30, 2004.  The
Chapter 11 Case was filed in the United States Bankruptcy Court
for the District of Delaware (Bankr. Case No. 04-11299) and venue
was subsequently transferred to the United States Bankruptcy Court
for the Northern District of California, San Francisco Division
(Bankr. Case No. 04-31394)(Carlson, J.).

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

Headquartered in San Mateo, California, Liberate Technologies
provides software and services for digital cable systems.  The
Company filed for chapter 11 protection on April 30, 2004 (Bankr.
D. Del. Case No. 04-11299). Daniel J. DeFranceschi, Esq. at
Richards, Layton & Finger represents the Debtor in its chapter 11
case. When the Company filed for bankruptcy protection, it listed
$257,000,000 in total assets and more than $50 million in total
debts.


MCGARRH TRUCKING: Case Summary & 20 Largest Unsecured Creditors
---------------------------------------------------------------
Debtor: McGarrh Trucking, Inc.
        dba Henderson Express
        2047 Crestline Drive
        Henderson Kentucky 42420

Bankruptcy Case No.: 04-41841

Type of Business: The Debtor provides freight trucking services.

Chapter 11 Petition Date: September 9, 2004

Court: Western District of Kentucky (Owensboro)

Debtor's Counsel: Sandra D. Freeburger, Esq.
                  Deitz & Freeburger, P.S.C.
                  101 First Street
                  P.O. Box 21
                  Henderson, KY 42419-0021
                  Tel: 270-830-0830

Estimated Assets: $100,000 to $500,000

Estimated Debts:  $1 Million to $10 Million

Debtor's 20 Largest Unsecured Creditors:

Entity                                 Claim Amount
------                                 ------------
Internal Revenue Service                   $312,641
P O Box 1706, Stop 510
Louisville KY 40201

Kentucky Revenue Cabinet                    $37,000

Francis McGarrh                             $25,839

Pilot Corporation                           $24,084

EFS Transporatation Services                $17,881

Xtra Lease                                  $15,504

Lincoln General Ins. Co.                    $14,000

Archway Insurance Group                     $12,367

MBNA                                        $10,000

Internal Revenue Service                     $5,874

Auto Wheel & Rim Service Co, Inc.            $4,314

R & H Truck & Trailer Sales Inc.             $3,994

Hazelwood Towing and Recovery                $3,790

Brad Parrott, CPA                            $3,750

Action Western Star                          $3,622

Indiana Department of Revenue                $3,553

Raben Tire Company                           $2,365

Clarke Detroit Diesel - Allison              $2,086

Canawill, Inc.                               $2,000

Cananwill, Inc.                              $2,000


METROPCS INC: Fails to Comply with Covenant Due to Late Filing
--------------------------------------------------------------
MetroPCS, Inc. says the trustee under the indenture governing its
$150 million of 10-3/4% senior notes due 2011 has provided notice
to MetroPCS of its failure to comply with a covenant requiring
MetroPCS to file with the SEC and furnish its noteholders on a
timely basis its quarterly report on Form 10-Q for the quarter
ended June 30, 2004.

Receipt of this notice does not result immediately in an event of
default under the indenture or acceleration of the notes. However,
an event of default will occur and the trustee or the holders of
25% of the principal amount of the notes will have the right to
accelerate the notes at 100% of par value, if MetroPCS fails to
comply with this covenant by November 8, 2004. Based on the most
recently available trading data, the notes have a market value
above par. Nevertheless, if an acceleration of the notes were to
occur, MetroPCS might then be unable to satisfy its note payment
obligations, and would likely seek alternative financing sources
to satisfy those obligations.

As previously announced, the MetroPCS Audit Committee is
conducting an independent investigation into an understatement of
revenues and net income for the quarter ended March 31, 2004.
MetroPCS will delay its second quarter 2004 earnings release and
the filing of its second quarter 2004 10-Q until after completion
of the investigation, and cannot predict when such investigation
will be completed. However, the Audit Committee intends to
complete the investigation as soon as practicable, and management
intends to avoid the event of default under the indenture by
filing the second quarter 2004 10-Q promptly after the
investigation and on or prior to November 8, 2004.

                     About MetroPCS, Inc.

Dallas-based MetroPCS, Inc. is a wholly-owned subsidiary of
MetroPCS Communications, Inc. and a provider of wireless
communications services.  Through its subsidiaries, MetroPCS, Inc.
holds 18 PCS licenses in the greater Miami, San Francisco, Atlanta
and Sacramento metropolitan areas.  MetroPCS offers customers flat
rate plans with unlimited anytime local and long distance minutes
with no contract.  MetroPCS is among the first wireless operators
to deploy an all-digital network based on third generation
infrastructure and handsets.  For more information, visit the
MetroPCS web site at http://www.metropcs.com/

                        *     *     *

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

                  Liquidity and Capital Resources

"The construction of our network and the marketing and
distribution of our wireless communications products and services
have required, and will continue to require, substantial capital
investment. Capital outlays have included license acquisition
costs, capital expenditures for network construction, funding of
operating cash flow losses and other working capital costs, debt
service and financing fees and expenses. We estimate that our
aggregate capital expenditures for 2004, which will be primarily
associated with our efforts to increase the capacity of our
network, will be approximately $210 million, of which $49.2
million had been incurred through March 31, 2004. We believe our
cash on hand and cash generated from operations will be sufficient
to meet our projected capital requirements for the foreseeable
future. Although we estimate that these funds will be sufficient
to finance our continued growth, we may have additional capital
requirements, which could be substantial, for future network
upgrades, and advances in new technology.

"Existing Indebtedness. As of March 31, 2004, we had $193.1
million of total indebtedness. This indebtedness consists of
$150.0 million of our senior notes, $43.5 million face amount of
our FCC notes, which are recorded net of unamortized original
issue discount of $4.2 million, and $3.8 million of debt
associated with our obligation to other carriers for the cost of
clearing microwave links in areas covered by our licenses."


MIDLAND REALTY: Fitch Affirms Low-B Ratings on Cert. Classes J & K
------------------------------------------------------------------
Fitch upgrades Midland Realty Acceptance Corporation commercial
mortgage pass-through certificates, series 1996-C2 as follows:

   -- $7.7 million class E to 'AAA' from 'AA';
   -- $15.4 million class F to 'A+' from 'A'.

In addition, Fitch affirms the following classes:

   -- $111.4 million class A-2 at 'AAA';
   -- Interest-only class A-EC at 'AAA';
   -- $30.7 million class B at 'AAA';
   -- $20.2 million class C at 'AAA';
   -- $23.0 million class D at 'AAA';
   -- $12.8 million class G at 'BBB';
   -- $5.1 million class H at 'BBB-';
   -- $12.8 million class J at 'BB';
   -- $7.7 million class K at 'B'.

Fitch does not rate the $10.8 million class L-1 or the
$10.8 million class L-2. Class A-1 has paid in full.

The upgrades reflect increased credit enhancement levels from loan
payoffs and amortization since issuance.  As of the August 2004
distribution date, the pool's aggregate collateral balance has
been reduced by approximately 48.4% to $264.1 million from
$512.1 million at issuance.

Midland Loan Services, the master servicer, has collected year-end
2003 financials for 95.0% of the loans in the pool.  The YE 2003
comparable weighted debt service coverage ratio -- DSCR -- was
1.47 times (x), a decrease from 1.60x at YE 2002.  However, the YE
2003 performance has increased since the 1.43x reported at
issuance for the same loans.  Loans with YE 2003 DSCRs less than
1.0x constitute 9.3% of the pool.

Three loans, constituting 3.9% of the pool are currently in
special servicing.  The largest specially serviced loan (2.1%) is
secured by a retail property in Malone, New York.  Since
undergoing a modification in April 2004, the loan has been pending
return to the master servicer.  The next largest loan in special
servicing (1.5%) is secured by two industrial buildings in
Hialeah, Florida, which are both 100% vacant.  A foreclosure sale
is scheduled for October 2004.

Although losses are possible upon the disposition of these assets,
upgrades are warranted due to the increased credit enhancement.


MIRANT CORP: Has Until Plan Confirmation to Decide on Leases
------------------------------------------------------------
U.S. Bankruptcy Court for the Northern District of Texas extends
the time for Mirant Corporation and its debtor-affiliates to elect
to assume or reject their Leases until the confirmation date of
the Debtors' plan of reorganization.

Due to the objection raised by the City of Wyandotte to the
Debtors' request for the lease decision period, the Court gave the
Debtors until September 29, 2004, to assume or reject the
Wyandotte Lease.  Furthermore, on that date, the Court will
consider a further extension of the time to assume or reject the
Wyandotte Lease together with a timely filed motion to consider
any unpaid obligations due and owing under the Wyandotte Lease
pursuant to Section 365(d)(3) of the Bankruptcy Code.

Mark E. MacDonald, Esq., at MacDonald + MacDonald, PC, in Dallas,
Texas, relates that on December 21, 2000, the City of Wyandotte,
Michigan and Tenaska Michigan Partners, LP, signed a Lease
Agreement for certain parcels of property the City owned.  The
Lease allows Tenaska to develop an electrical generating facility
on the leased premises.

On January 24, 2001, Mirant Michigan Investments, Inc., acquired
100% of the ownership interests in Tenaska Michigan Partners,
LLC.  Wyandotte Michigan, LLC, is the legal successor to both
Tenaska LP and Tenaska LLC.  Based on the schedules Wyandotte
filed, it appears that $203,000,000 in net book value was invested
in work-in-progress on the Leased Premises.  The Lease requires
prompt payment of taxes.

According to Mr. MacDonald, ad valorem taxes relating to the
Leased Premises have not been paid as required by Section
365(d)(3) of the Bankruptcy Code:

    (a) $313,721 that became payable on August 1, 2003;

    (b) $301,655 that became payable on December 1, 2003; and

    (c) $714,501 that became payable on August 1, 2004.

Mr. MacDonald notes that the 2003 taxes are already a first and
prior lien on the Debtors' assets.  The 2004 taxes are both an
administrative expense and will be a lien on the Debtors' assets
unless paid by December 1, 2004.

Although the Debtors have been paying the $5,000 minimal rent per
month, Mr. MacDonald reports that the Debtors are not performing
their principal current monetary lease obligation.  Mirant
Wyandotte must pay all taxes accruing after the Construction
Finance Date on a timely basis.

The City asked Judge Lynn to deny the Debtors' request unless the
Court conditions the extension with the Debtors' payment of the
$1,378,142 outstanding 2003 and 2004 taxes, plus $60,538 interest,
before September 26, 2004.

As reported in the Troubled Company Reporter on August 11, 2004,
the Debtors asked the Court to extend their time to assume or
reject 15 unexpired non-residential real property leases,
excluding the MirMA Leases, until the date a plan of
reorganization is confirmed in the energy company's cases.

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


MORGAN STANLEY: Fitch Assigns Low-B Ratings to Six Cert. Classes
----------------------------------------------------------------
Fitch Ratings affirms Morgan Stanley Dean Witter Capital I Trust,
commercial mortgage pass-through certificates, series 2002-TOP7 as
follows:

   -- $222.4 million class A-1 at 'AAA';
   -- $572.3 million class A-2 at 'AAA';
   -- Interest Only (I/O) class X-1 at 'AAA';
   -- I/O class X-2 at 'AAA';
   -- $24.2 million class B at 'AA';
   -- $29.1 million class C at 'A';
   -- $7.3 million class D at 'A-';
   -- $7.3 million class E at 'BBB+';
   -- $12.1 million class F at 'BBB';
   -- $7.3 million class G at 'BBB-';
   -- $10.9 million class H at 'BB+';
   -- $8.5 million class J at 'BB';
   -- $7.3 million class K at 'BB-';
   -- $4.8 million class L at 'B+';
   -- $4.8 million class M at 'B';
   -- $2.4 million class N at 'B-';

Fitch does not rate the $9.7 million class O.

The affirmations are due to the stable pool performance and
scheduled amortization.  As of the August 2004 distribution date,
the pool's aggregate principal certificate balance has decreased
4.0% to $930.4 million compared to $969.4 million at issuance.

There is currently one loan in special servicing. Food 4 Less,
Amarillo (0.5% of the pool) is secured by a single tenant 55,242
square feet (sf) retail center located in Amarillo, Texas.  Due to
the bankruptcy filing and rejection of the lease by the sole
tenant Fleming, Co., the property became real estate owned through
foreclosure in January 2004.  The special servicer, GMAC
Commercial Mortgage Corp., is currently marketing the property for
sale.  A loss is expected on this loan.

The six credit assessed loans (17.4% of the pool) remain
investment grade.  Fitch reviewed operating statement analysis
reports and other performance information provided by the master
servicer, Wells Fargo Bank, N.A.  The debt service coverage ratio
-- DSCR -- for the loans are calculated based on a Fitch adjusted
net cash flow -- NCF -- and a stressed debt service based on the
current loan balance and a hypothetical mortgage constant.

Woodfield Shopping Center (6.8%) is secured by 917,916 sf of a 2.2
million sf super regional mall located in Schaumburg, Illinois.
The mall's anchors include:

   * Sears,
   * J.C. Penney,
   * Marshall Field's,
   * Nordstrom's, and
   * Lord & Taylor's.

The trust amount as of August 2004 was $63.5 million, which
represents a 25.3% pari passu interest in the $251.3 million
senior portion of the $293.3 million whole loan.  The remaining
senior portions are held as collateral in the MSDWC 2002-IQ2 and
the MSDWC 2002-HQ transactions.

As of YE 2003 the Fitch adjusted NCF for the Woodfield Mall has
remained stable since issuance.  Occupancy as of March 2004
increased to 89.6% compared to 85.4% at issuance.  The DSCR for
the trust portion of the loan as of YE 2003 has remained flat at
1.72 times (x) since issuance.

Kahala Mall (2.7%) is secured by a 363,432 sf retail center and
46,237 sf of office space located in Honolulu (Oaha Island) Hawaii
in the Waikiki/Kahala submarket.  The center consists of 252,886
sf of in-line space, 110,546 sf of anchor space and two office
buildings.  The Fitch adjusted NCF as of YE 2003 has increased
8.5%, due to an increase in occupancy to 98.9% compared to 92.5%
at issuance.  The corresponding DSCR has increased to 2.85x
compared to 2.17x at issuance.

The Grand Reserve at Kirkman Parke (2.1%) is secured by a 390-unit
class A luxury apartment complex located in Orlando, Florida.  The
property consists of one and four bedroom units.  Occupancy as of
YE 2003 declined to 93.0% compared to 97.2% at issuance.  The
Fitch adjusted NCF decreased 14.0% as of YE 2003, as a direct
result of the softening of the multifamily market and the drop in
occupancy.  The DSCR as of YE 2003 was 1.31x compared to 1.39x at
issuance.

The remaining three credit assessed loans (Renaissance Terrace
Apartments (2.1%), The Fairways at Bay Lea (1.9%) and Route 9
Plaza (1.8%)) have performed as or better than expected since
issuance.  The weighted average DSCR for the three remaining loans
as of YE 2003 was 1.53x compared to 1.51x at issuance.


NEWARK INSURANCE: Shut-Down Prompts Moody's to Withdraw Ratings
---------------------------------------------------------------
Moody's Investors Service has lowered and will withdraw its
insurance financial strength rating on Newark Insurance Company.
The insurance financial strength rating was lowered to Caa2 from
B2.  These actions have been taken because the insurer has been,
and remains, under regulatory supervision of the New Jersey
Department of Banking and Insurance and has consequently ceased
all operations, including writing new business.  Please refer to
Moody's Withdrawal Policy on http://moodys.com/

Newark Insurance Company is based in Bethpage, New York.


NOVA CDO: S&P Affirms Junk Ratings on Four CBO Notes Transaction
----------------------------------------------------------------
Standard & Poor's Ratings Services lowered its ratings on the
class C-1, C-2, D-1, and D-2 notes issued by NOVA CDO 2001 Ltd., a
high-yield arbitrage CBO transaction, and removed them from
CreditWatch, where they were placed with negative implications on
April 30, 2004.  At the same time, the rating on the class B notes
is affirmed due to the level of overcollateralization remaining to
support them, and the rating on the class A notes is affirmed
based on a financial guarantee insurance policy issued by
Financial Security Assurance, Inc.

The lowered ratings on the class C and D notes reflect factors
that have negatively affected the credit enhancement available to
support the notes since the last rating action.  These factors
include a negative migration in the credit quality of the
performing assets in the pool and a decline in the weighted
average coupon of the portfolio.

Currently, 11.68% of the ratings in the portfolio are on
CreditWatch negative and 8.63% of the performing assets are in the
'CCC' range.   According to the Aug. 4, 2004 trustee report, the
weighted average coupon was 9.508% versus a weighted average
coupon of 9.686% at the time of the April 30, 2004 CreditWatch
placement.

              Ratings Lowered and Off Creditwatch

                       NOVA CDO 2001 Ltd.

                                 Rating
                Class      To              From
                -----      --              ----
                C-1        CCC+            B/Watch Neg
                C-2        CCC+            B/Watch Neg
                D-1        CC              CCC-/Watch Neg
                D-2        CC              CCC-/Watch Neg

                        Ratings Affirmed

                       NOVA CDO 2001 Ltd.

                       Class      Rating
                       -----      ------
                       A          AAA
                       B          BBB

Transaction Information

Issuer:             NOVA CDO 2001 Ltd.
Co-issuer:          NOVA CDO 2001 Corp.
Current manager:    Phoenix Investment Partners Ltd.(bonds)
                    Antares Capital (loans)
Underwriter:        CIBC World Markets Corp.
Trustee:            JPMorganChase Bank
Transaction type:   Cash flow arbitrage high-yield CBO

   Tranche                 Initial    Last           Current
   Information             Report     Action         Action
   -----------             -------    ------         -------
   Date (MM/YYYY)          7/2001     4/2004         9/2004

   Class A Note Rtg        AAA        AAA            AAA
   Class A OC Ratio        124.27%    124.60%        123.82%
   Class A OC Ratio Min    116.40%    116.40%        116.40%
   Class A Note Balance    $237.000mm $146.531mm     $145.624mm
   Class B Note Rtg        BBB        BBB            BBB
   Class B OC Ratio        115.91%    111.57%        110.88%
   Class B OC Ratio Min    111.50%    111.50%        111.50%
   Class B Note Balance    $17.100mm  $17.139mm      $17.100mm
   Class C-1 Note Rtg      BB-        B/Watch Neg    CCC+
   Class C-2 Note Rtg      BB-        B/Watch Neg    CCC+
   Class C OC Ratio        110.19%    103.25%        102.60%
   Class C OC Ratio Min    103.00%    103.00%        103.00%
   Class C-1 Note Balance  $3.500mm   $4.223mm       $3.892mm
   Class C-2 Note Balance  $9.700mm   $10.920mm      $10.000mm
   Class D-1 Note Rtg      B-         CCC-/Watch Neg CC
   Class D-2 Note Rtg      B-         CCC-/Watch Neg CC
   Class D OC Ratio        105.08%    97.76%         97.57%
   Class D OC Ratio Min    100.00%    100.00%        100.00%
   Class D-1 Note Balance  $9.400mm   $11.584mm      $12.414mm
   Class D-2 Note Balance  $3.600mm   $4.143mm       $4.334mm

        Portfolio Benchmarks                     Current
        --------------------                     -------
        S&P Wtd. Avg. Rtg (excl. defaulted)      BB-
        S&P Default Measure (excl. defaulted)    3.14%
        S&P Variability Measure(excl. defaulted) 2.19%
        S&P Correlation Measure(excl. defaulted) 1.22
        Wtd. Avg. Coupon (excl. defaulted)       9.56%
        Wtd. Avg. Spread (excl. defaulted)       2.65%
        Oblig. Rtd. 'BBB-' and Above             11.18%
        Oblig. Rtd. 'BB-' and Above              57.18%
        Oblig. Rtd. 'B-' and Above               91.37%
        Oblig. Rtd. in 'CCC' Range               8.63%
        Oblig. Rtd. 'CC', 'SD' or 'D'            0.00%
        Obligors on Watch Neg (excl. defaulted)  11.68%

   Rated OC Ratios (ROCs)  Prior To Action       After Action
   ----------------------  ---------------       ------------
   Class A note            N/A(1)                N/A(1)
   Class B note            105.07%               105.07%
   Class C-1/C-2 notes     100.85%               102.30%
   Class D-1/D-2 notes     N/A(2)                N/A(2)

   (1) ROC is not published for insured tranches because the
       insurance policy, rather than the tranche credit support,
       determines the public rating.

   (2) ROC is not provided for tranches rated 'CC' or 'D' because
       these tranches are expected to default.

For information on Standard & Poor's CDO Portfolio Benchmarks and
Rated Overcollateralization -- ROC -- Statistic, please see "ROC
Report August 2004," published on RatingsDirect, Standard & Poor's
Web-based credit analysis system, and on the Standard & Poor's Web
site at http://www.standardandpoors.com/ Go to "Fixed Income,"
under "Browse by Sector" choose "Structured Finance," and under
Commentary & News click on "More" and scroll down to the desired
articles.


OM ENTERPRISES: Voluntary Chapter 11 Case Summary
-------------------------------------------------
Debtor: OM Enterprises of Louisville Inc.
        12601 Townpark Way, Suite 200
        Louisville, Kentucky 40243

Bankruptcy Case No.: 04-35657

Chapter 11 Petition Date: September 3, 2004

Court: Western District of Kentucky (Louisville)

Judge: David T. Stosberg

Debtor's Counsel: Timothy F. Mann, Esq.
                  212 Kinnaird Lane
                  Louisville, KY 40243
                  Tel: 502-245-000

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.


ORBITAL SCIENCES: Names G. David Low VP-Techn'l Services Division
-----------------------------------------------------------------
Orbital Sciences Corporation (NYSE:ORB) names Mr. G. David Low
Vice President of its Technical Services Division, headquartered
in Greenbelt, MD. Mr. Low will succeed Mr. Richard Hicks, who is
remaining with TSD on a part-time basis as an advisor on existing
contracts and new business opportunities. Mr. Hicks has held
various positions in the aerospace industry over the past 43 years
and is entering into partial retirement. Mr. Low assumed his new
post on September 7.

"It is with great confidence in David's abilities that we announce
his appointment as the new head of our Technical Services
Division," said Mr. Jack Danko, Orbital's Executive Vice President
and General Manager of its Space Systems Group. "His credentials
as a senior Orbital manager and extensive knowledge of and
background with NASA, TSD's principal customer, represent a
perfect fit for the TSD business."

Mr. Danko also added, "I am also pleased that Dick Hicks has
agreed to remain active in the TSD business. Orbital will continue
to benefit from the insight and wisdom he gained during his many
years in the industry."

Mr. Low has served with Orbital for the past eight years, joining
the company's Launch Systems Group in 1996 as Vice President of
Safety and Mission Assurance, spearheading the Group's ISO
qualification effort. In addition to holding several other senior
positions in the company, Mr. Low most recently served as Vice
President and Deputy General Manager of Orbital's Advanced
Programs Group. In this role, he helped lead the company's
participation in NASA's efforts to develop new human space
exploration systems.

Prior to joining Orbital, Mr. Low was a NASA astronaut from 1984
until 1996. During this time he flew on three Space Shuttle
missions as a mission specialist, flight engineer and payload
commander. During his more than 700 hours in space, Mr. Low helped
to deploy two communications satellites and retrieve two
scientific satellites using the Shuttle's robotic arm. He also
conducted a six-hour spacewalk and participated in numerous
scientific and medical experiments. Mr. Low began his career with
NASA in 1980 as a spacecraft systems engineer for the Jet
Propulsion Laboratory.

Mr. Low holds a B.S. in Physics-Engineering from Washington and
Lee University, a B.S. in Mechanical Engineering from Cornell
University, an M.S. in Aeronautics and Astronautics from Stanford
University and an MBA from Johns Hopkins University. He has also
completed the Advanced Management Program at Harvard Business
School.

Mr. Low is a recipient of the NASA Outstanding Leadership Medal,
the NASA Exceptional Service Medal, three NASA Space Flight Medals
and an honorary Doctor of Engineering Degree from Rensselaer
Polytechnic Institute. He is an Associate Fellow of the AIAA.

Mr. Low resides in Potomac Falls, Virginia with his wife JoAnn and
their three children

                          About Orbital

Orbital develops and manufactures small space and rocket systems
for commercial, military and civil government customers. The
company's primary products are satellites and launch vehicles,
including low-orbit, geosynchronous and planetary spacecraft for
communications, remote sensing, scientific and defense missions;
ground- and air-launched rockets that deliver satellites into
orbit; and missile defense systems that are used as interceptor
and target vehicles. Orbital also offers space-related technical
services to government agencies and develops and builds satellite-
based transportation management systems for public transit
agencies and private vehicle fleet operators.

                          *     *     *

As reported in the Troubled Company Reporter's June 14, 2004
edition, Standard & Poor's Ratings Services raised its ratings,
including the corporate credit rating to 'BB-' from 'B+', on
Orbital Sciences Corp. The outlook is stable. The company has
$135 million in rated debt.

"The upgrade reflects Orbital's improved credit profile,
supported by adequate liquidity, better operating performance, and
a sizable backlog," said Standard & Poor's credit analyst
Christopher DeNicolo.


OWENS CORNING: Objects to M. Pope's Fee Disgorgement Request
------------------------------------------------------------
Credit Suisse First Boston, Kensington International, Limited,
Springfield Associates, LLC and Angelo, Gordon & Co. inform the
U.S. Bankruptcy Court for the District of Delaware of their views
on the request of Michael Pope to require the advisors in the
chapter 11 cases of Owens Corning and its debtor-affiliates.

As reported in the Troubled Company Reporter on September 6, 2004,
in view of Professor Francis McGovern's resignation as Court-
appointed advisor effective June 30, 2004, and upon representation
made by the counsel for C. Judson Hamlin and David Gross that they
are no longer acting in any capacity in the Debtors' bankruptcy
proceedings, Michael Pope withdraws his request for
disqualification and termination as moot.

Mr. Pope, instead, asked the U.S. District Court for the District
of Delaware to:

   (a) require Messrs. Hamlin, Gross and McGovern to disgorge the
       fees they or their firms, Purcell, Ries, Shannon, Mulcahy
       & O'Neill, Budd Larner, P.C., David Gross & Associates, or
       Saiber Schlesinger Satz & Goldstein, LLC, received as
       Court-appointed advisors, consultants or mediators; and

   (b) order Messrs. Hamlin, Gross and McGovern to promptly
       submit their final fee applications, but hold any payment
       in abeyance pending the Bankruptcy Court's adjudication of
       the request for disgorgement.

CSFB, Kensington, Springfield and Angelo assert that all fee
disgorgement proceedings should be heard in the U.S. District
Court for the District of Delaware. Any bifurcation of fee
disgorgement proceedings between the District Court and the
Bankruptcy Court would be factually unwarranted and judicially
inefficient and wasteful.

The Amended Supplemental Pope Motion seeks disgorgement of all
fees paid to C. Judson Hamlin, David Gross and Francis McGovern,
regardless of whether they served as advisors or consultants to
Judge Wolin or mediators between and among the parties.  The
disgorgement includes the $2.6 million paid to Mr. McGovern for
his mediation services, and the hundreds of thousands of dollars
paid to Saiber Schlesinger Satz & Goldstein, LLC, which now
employs Judge Wolin and his son.

Rebecca L. Butcher, Esq., at Landis, Rath & Cobb, in Wilmington,
Delaware, emphasizes that Mr. McGovern's role in these cases
derives from his original appointment by the District Court.
Although the Bankruptcy Court entered a subsequent order
specifying McGovern's role as mediator in these cases, most of
McGovern's "mediation services" continued to occur in connection
with matters before, or closely supervised by the District Court.

In any event, Ms. Butcher points out, bifurcating review of Mr.
McGovern's services and the resolution of fee disgorgement issues
between the District Court and the Bankruptcy Court would only
confuse and delay matters.  The substantial fees earned by Messrs.
Gross, Hamlin and McGovern presently are before the District
Court, and there is no basis for having duplicative, parallel
proceedings in the Bankruptcy Court that would involve the same
facts, the same parties and the same or very similar issues.

                   Francis McGovern Responds

Francis McGovern finds the amendment to set a deadline to submit
final fee applications as unnecessary.

Sam C. Pointer, Jr., Esq., at Lightfoot, Franklin & White, in
Birmingham, Alabama, tells the Court that Mr. McGovern's services
as a consultant concluded in the Spring of 2001, and he charged
and was paid for fees and expenses from December 26, 2000, to
January 31, 2001.  Mr. Pointer tells the Court that Mr. McGovern
will not seek any additional fees, and he does not need any more
time to submit a further fee application.

Mr. Pointer asserts that any issues relating to Mr. McGovern's
services and fees as a mediator in the Debtors' case should, at
least initially, be considered by the Bankruptcy Court -- the
court that appointed Mr. McGovern, established his fees, and saw
the fruits of his many months of work.

Mr. Pointer notes that to grant Mr. Pope's request would:

    -- constitute a withdrawal of the reference with respect to
       Mr. McGovern's services and fees as a mediator in the
       Debtors' case; and

    -- deprive the District Court of the benefits that would come
       from the Bankruptcy Court's consideration of any attack on
       those services and fees.

Accordingly, Mr. McGovern asks the District Court to summarily
deny Mr. Pope's request to amend.

                  Debtors Wants Request Denied

The Debtors ask the Court to deny Michael Pope's request so as to
avoid further waste of estate resources in light of the fact that
Francis McGovern is no longer employed in any capacity in the
Debtors' cases.

J. Kate Stickles, Esq., at Saul Ewing, LLP, in Wilmington,
Delaware, relates that Mr. Pope has not offered any compelling
reason why he should be permitted to amend the Supplemental
Disqualification Motion to include additional prayers for relief.
Mr. Pope cannot claim any excuse for his failure to seek
disgorgement of Mr. McGovern's mediator fees prior to the hearing
on the merits of his request.

The Debtors are also concerned that the premise of Mr. Pope's
request to amend filed at this late stage of the proceedings is
based on a claim that Mr. Pope was unaware of the Order appointing
Mr. McGovern as a mediator.  It would set a dangerous precedent in
these cases if a creditor is permitted to appear at this late
date, claim ignorance of the prior pleadings and court orders, and
seek to relitigate matters for which the Bankruptcy Court already
has entered a final order.

Furthermore, there is no reason to amend the pleading to direct
the submission of final fee applications at this time.  Regardless
of the proposed amendment, final fee applications ultimately will
be filed with the Court and parties-in-interest will have the
right to object.  To the extent final fee applications are not
filed as required, payment will not be rendered.

Headquartered in Toledo, Ohio, Owens Corning --
http://www.owenscorning.com/-- manufactures fiberglass
insulation, roofing materials, vinyl windows and siding, patio
doors, rain gutters and downspouts.  The Company filed for chapter
11 protection on October 5, 2000 (Bankr. Del. Case. No. 00-03837).
Mark S. Chehi, Esq., at Skadden, Arps, Slate, Meagher & Flom
represents the Debtors in their restructuring efforts.  At
June 30, 2004, the Company's balance sheet shows $7.3 billion in
assets and a $4.3 billion stockholders' deficit. (Owens Corning
Bankruptcy News, Issue No. 83 Bankruptcy Creditors' Service, Inc.,
215/945-7000)


PARMALAT: Has Until Thursday to File Plan & Disclosure Statement
----------------------------------------------------------------
After further negotiations, Parmalat USA Corporation and its U.S.
debtor-affiliates, General Electric Capital Corporation as agent
and lender, Citibank, N.A., and the Official Committee of
Unsecured Creditors agree that the Debtors will file a plan of
reorganization and accompanying disclosure statement on or before
September 16, 2004.  The Debtors' failure to comply will
constitute a Termination Event under the DIP Financing Agreement.

The parties also agree that all obligations and commitments of
Citibank, GE Capital and the DIP Lenders, and the U.S. Debtors'
authorization to use the Cash Collateral, will terminate at the
earliest of:

      (i) September 16, 2004, solely with respect to the DIP
          Financing Agreement;

     (ii) the effective date of any reorganization plan;

    (iii) the entry of a Court order converting any of the
          Chapter 11 Cases to a case under Chapter 7 of the
          Bankruptcy Code or dismissing any of the cases; or

     (iv) the termination of the DIP Financing Agreement or the
          Debtors' Receivables Purchase Agreement with Citibank.

The Final DIP Order remains in full force and effect in all other
respects.

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


PENN TRAFFIC: Selling Distribution Centers for $45.9 Million
------------------------------------------------------------
The Penn Traffic Company, through Keen Realty, LLC, is marketing
for sale-leaseback these distribution Centers for $45.9 Million in
connection with its plan to emerge from Chapter 11:

Property Type      Address               Land Size   Building Size
-------------      -------               ---------   -------------
Jamestown DC       133 Jackson Avenue        14.10         287,959
                   Jamestown, New York

State Fair         1200 State Fair Blvd.     25.84         567,800
Blvd DC            Syracuse, New York

P&C                3407 Walters Road         50.50         273,225
Perishable DC      Syracuse, New York

BiLo               851 Beaver Drive          30.38         202,800
Perishable DC      Dubois, Pennsylvania

PT Dry Goods       Shaffer Road & Route 255  25.87         410,000
Warehouse          Dubois, Pennsylvania

Keen advises that the cap rate is 9%.

"This sale-leaseback is a terrific opportunity for investors to
obtain a quality real estate portfolio with a strong tenant, Penn
Traffic.  The reorganized company has new leadership that has
stabilized the company and will grow it into the future," said
Chris Mahoney, Keen Realty's Vice President.  "We are encouraging
prospective purchasers to submit their offers as soon as possible,
as the company plans to move quickly with its exit from
bankruptcy."  A complete list of locations and offering terms are
available upon request.  Interested parties must act immediately.

Keen Realty, LLC is a consulting firm specializing in providing
real estate consulting services to companies and their creditors
in bankruptcy and work-out scenarios.  For 22 years, Keen Realty,
LLC solved complex problems and evaluated and sold over 230
million square feet of real estate, leases and businesses in
bankruptcies, workouts and restructurings, and repositioned nearly
13,000 retail properties across the country.  Other current and
recent clients of Keen include Arthur Andersen, Cooker
Restaurants, Country Home Bakers, Cumberland Farms, Eddie Bauer,
FILA, Fleming, Huffman Koos, Just for Feet, Parmalat, Pillowtex,
Spiegel, and Warnaco.

For more information regarding these available locations, please
contact:

          Keen Realty, LLC
          60 Cutter Mill Road, Suite 407
          Great Neck, NY 11021
          Telephone: 516-482-2700 x 229
          Fax: 516-482-5764
          e-mail: cmahoney@keenconsultants.com
          http://www.keenconsultants.com/

Headquartered in Rye, New York, Penn Traffic Company distributes
through retail and wholesale outlets.  The Group through its
supermarkets carries on the retail and wholesale distribution of
food, franchise supermarkets and independent wholesale accounts.
The Company filed for chapter 11 protection on May 30, 2003
(Bankr. S.D.N.Y. Case No. 03-22945).  Kelley Ann Cornish, Esq., at
Paul Weiss Rifkind Wharton & Garrison, represent the Debtors in
their restructuring efforts.  When the grocer filed for protection
from their creditors, they listed $736,532,614 in total assets and
$736,532,610 in total debts.


PEREGRINE SYS: June 30 Balance Sheet Upside-Down by $272 Million
----------------------------------------------------------------
Peregrine Systems, Inc. (OTC: PRGN), a leading provider of asset
and service management solutions, released historical financial
results for the fiscal 2004 first quarter ended June 30, 2003.

The filing of Peregrine's fiscal 2004 first quarter 10-Q was
delayed due to Peregrine's prior financial restatement, voluntary
Chapter 11 bankruptcy reorganization proceedings and restructuring
activities.

As a result of Peregrine's emergence from reorganization
proceedings on Aug. 7, 2003, the company intends to adopt fresh-
start reporting in the fiscal year 2004 second quarter ended Sept.
30, 2003 in accordance with GAAP (Generally Accepted Accounting
Principles).

Historical GAAP Financial Results and Highlights:

   -- Total revenues for the fiscal 2004 first quarter were $42.5
      million, a decrease of 14 percent over the same period of
      the preceding year. The fiscal 2003 first quarter total
      revenues were $49.5 million, which included approximately
      $6.7 million from non-core products that were subsequently
      divested during fiscal 2003.  The company's core products
      consist primarily of AssetCenter(R) and ServiceCenter(R).

   -- Total license revenues for the fiscal 2004 first quarter
      were $12.5 million, a decline of approximately 4 percent
      when compared with the fiscal 2003 first quarter license
      revenue of $13.0 million.  Of the total core license revenue
      in the fiscal 2004 first quarter, approximately $7.5 million
      was for license transactions initiated in the quarter, while
      approximately $5.0 million was attributable to transactions
      initiated prior to fiscal 2003.  The $5.0 million in revenue
      was included as part of the fiscal 2004 first quarter
      revenue because the revenue recognition criteria for these
      transactions were not met until this period.

   -- The fiscal 2003 first quarter license revenue included
      approximately $1.0 million in revenues for non-core
      products. Of the total core license revenue in the fiscal
      2003 first quarter, approximately $2.2 million was for
      license transactions initiated in the quarter, while
      approximately $9.7 million was attributable to transactions
      initiated prior to fiscal 2003.

   -- Net loss totaled $9.1 million on 196 million diluted shares
      outstanding in the fiscal 2004 first quarter, compared with
      a net loss of $79.6 million on 195 million diluted shares
      outstanding for the same period of the preceding year.  In
      the fiscal 2004 first quarter, income from continuing
      operations before reorganization items, interest and income
      taxes was $1.3 million.

   -- Peregrine's cash and cash equivalent balances, excluding
      restricted cash and short-term investments, were $227.3
      million and $234.3 million at June 30, 2003 and March 31,
      2003, respectively.

Historical Non-GAAP Pro Forma Financial Results:

   -- Peregrine reported a non-GAAP pro forma net loss of $3.0
      million in the fiscal 2004 first quarter, or $0.02 per
      diluted share, compared with a non-GAAP pro forma net loss
      of $71.0 million in the fiscal  2003 first quarter.  The
      non-GAAP pro forma results exclude bankruptcy
      reorganization, restructuring and impairments.

The company has reconciled the non-GAAP pro forma net loss to GAAP
net loss in the table below (in thousands, except diluted EPS).
The pro forma net loss is not prepared in accordance with
accounting principles generally accepted in the United States, and
may be different from non-GAAP financial measures used by other
companies. Non-GAAP financial measures should not be considered as
a substitute for, or superior to, measures of financial
performance prepared in accordance to GAAP.

Peregrine uses non-GAAP pro forma information in analyzing
financial results because Peregrine management believes that it
provides meaningful information regarding the company's operating
performance and facilitates management's internal comparisons to
the company's historical and current operating results and to the
operating results of other companies. The company believes that
non-GAAP pro forma information is useful to investors because it
allows for greater transparency of the company's operating
performance.

                     Management Commentary

"Our financial results for the first quarter of fiscal 2004
provide clear evidence of a positive trend in Peregrine's return
to operational stability," said John Mutch, Peregrine's president
and CEO. "We were able to dramatically reduce our operating costs
during the first quarter, while slightly increasing our license
and maintenance revenue from our core products over the same
period of the preceding year."

                     Fresh-Start Reporting

Fresh-start reporting requires that the company adjust the
historical cost of its assets and liabilities to their fair value,
effective July 18, 2003, the date of approval of the company's
plan of reorganization. Accordingly, the company will re-value its
balance sheet in the fiscal 2004 second quarter, which includes
adjusting the value of current assets, property and equipment,
intangible assets, accrued liabilities, deferred revenue and
stockholders' equity for the effects of the company's plan of
reorganization.

The fair value of the new common stock for the reorganized company
was determined by management to be $270 million, which represents
the company's enterprise value adjusted for debt financing, net of
cash. The non-trade debt of the reorganized company totals
approximately $86 million as of August 2003, including secured
factor loans, senior notes and non-interest bearing notes issued
to satisfy pre-petition debt. As a result of fresh-start
reporting, it may be difficult to compare financial results for
the fiscal 2004 second quarter with other quarters of fiscal year
2004 as well as the quarters in prior fiscal years.

                     About Peregrine Systems

Peregrine Systems, Inc. develops enterprise software solutions
that enable organizations to evolve their IT service and asset
management practices for reduced costs, improved IT productivity
and service, and lower risk. The company's asset and service
management offerings -- such as Service Control and Expense
Control -- address specific business problems. These solutions
make it possible for IT organizations to maintain a changing IT
infrastructure, manage their relationships with end-users and
service providers, and gain greater visibility into the how IT
investments are performing. The Peregrine Evolution Model provides
a roadmap for companies that want to systematically evolve the
sophistication and effectiveness of their IT operating practices.

Founded in 1981, Peregrine Systems has sustained a rich tradition
of delivering solutions with superior functionality to a broad
segment of the global enterprise customer market. Headquartered in
San Diego, Calif., the company conducts business from offices in
the Americas, Europe, and Asia Pacific.

At June 30, 2004, Peregrine System' balance sheet showed a
$272,116,000 stockholders' deficit, compared to a $263,999,000
deficit at March 31, 2003.


PRIME HOSPITALITY: Launches 8-3/4% Cash Tender Offer & Consent
--------------------------------------------------------------
Prime Hospitality Corp. (NYSE: PDQ) had commenced a cash tender
offer to purchase any and all of its outstanding 8-3/8% Senior
Subordinated Notes due 2012 (CUSIP No. 741917AJ7), as well as a
related consent solicitation to amend the Notes and the indenture
pursuant to which they were issued. The tender offer and consent
solicitation are being conducted in connection with Prime
Hospitality's previously announced agreement to merge with an
affiliate of The Blackstone Group.

The consent solicitation will expire at 5:00 p.m., New York City
time, on Wednesday, September 22, 2004, unless extended or amended
by the Company. Tendered Notes may not be withdrawn and consents
may not be revoked after the consent expiration date. The tender
offer will expire at 8:00 a.m., New York City time, on Friday,
October 8, 2004, unless extended or earlier terminated by the
Company.

Holders tendering their Notes will be required to consent to
proposed amendments to the Notes and to the indenture governing
the Notes, which will eliminate substantially all of the
restrictive covenants and certain events of default, amend the
merger and consolidation covenant and make changes to the
defeasance provisions. Holders may not tender their Notes without
also delivering consents or deliver consents without also
tendering their Notes.

The total consideration to be paid for each $1,000 principal
amount of Notes will be a price equal to the present value, as of
the payment date for such Notes purchased in the tender offer, of
the earliest redemption price for such Notes ($1,041.88) and
interest that would accrue on such Notes from the payment date up
to, but not including the earliest redemption date (May 1, 2007),
calculated based on:

   (a) the yield to maturity on the 4.375% U.S. Treasury Note due
       May 15, 2007, as calculated by Banc of America Securities
       LLC in accordance with standard market practice, based on
       the bid price of such reference security as of 2:00 p.m.,
       New York City time, on the tenth business day immediately
       preceding the Tender Offer Expiration Date, as displayed on
       Bloomberg Government Pricing Monitor on "Page PX5" or any
       recognized quotation source selected by Banc of America
       Securities LLC in its sole discretion, plus

   (b) 50 basis points. Holders whose Notes are accepted for
       payment will also be paid accrued and unpaid interest up
       to, but not including the date of payment for the Notes.
       The total consideration includes a consent payment of
       $30.00 per $1,000 principal amount of the Notes which will
       be payable only in respect of the Notes purchased that are
       tendered on or prior to the consent expiration date.
       Holders who tender their Notes after the consent expiration
       date will not be entitled to receive the consent payment.

The tender offer and consent solicitation are made upon the terms
and conditions set forth in the Offer to Purchase and Consent
Solicitation Statement, dated September 9, 2004 and the related
Consent and Letter of Transmittal. The tender offer and consent
solicitation are subject to the satisfaction of certain
conditions, including receipt of consents sufficient to approve
the proposed amendments and the merger having occurred or
occurring substantially concurrent with the tender offer
expiration date. The purpose of the tender offer is to acquire all
outstanding Notes in connection with the merger. The purpose of
the consent solicitation is to, among other things, amend the
Notes and the indenture governing the Notes to eliminate
substantially all of the restrictive covenants and certain events
of default, amend the merger and consolidation covenant and make
changes to the defeasance provisions (and make related changes in
the Notes).

Prime Hospitality has retained Banc of America Securities LLC and
Bear, Stearns & Co. Inc. to act as the Dealer Managers for the
tender offer and Solicitation Agents for the consent solicitation.
Banc of America Securities LLC can be contacted at (888) 292-0070
(toll free) and (704) 388-9217 and Bear, Stearns & Co. Inc. can be
contacted at (877) 696-BEAR (toll free). The tender offer and
consent solicitation documents are expected to be distributed to
holders beginning today. Requests for documentation may be
directed to D.F. King & Co., Inc., the Information Agent, which
can be contacted at (212) 269- 5550 (for banks and brokers only)
and (800) 628-8532 (for all others toll free).

Prime Hospitality owns, manages, and franchises 247 hotels
throughout the U.S. The company owns and operates three
proprietary brands that compete in different segments:
AmeriSuites, Wellesday Inns & Suites, and Prime Hotels and
Resorts. Also within its portfolio are owned and/or managed hotels
operated under franchise agreements with national hotel chains
including Hilton, Radisson, Sheraton, Holiday Inn, and Ramada.

                 About Prime Hospitality Corp.

Prime Hospitality Corp., one of the nation's premiere lodging
companies, owns, manages, develops and franchises more than 240
hotels throughout North America. The Company owns and operates
three proprietary brands, AmeriSuites(R) (all suites), PRIME
Hotels & Resorts(R) (full-service) and Wellesley Inns & Suites(R)
(limited service). Also within Prime's portfolio are owned and/or
managed hotels operated under franchise agreements with national
hotel chains including Hilton, Sheraton, Hampton, and Holiday Inn.
Prime can be accessed over the Internet at
http://www.primehospitality.com/

                          *      *     *

As reported in the Troubled Company Reporter on August 23, 2004,
Standard & Poor's Ratings Services placed its 'BB-' corporate
credit and 'B' subordinated debt ratings on Prime Hospitality,
Corp., on CreditWatch with negative implications.

Fairfield, New Jersey-based hotel operator had about $223 million
of debt outstanding at the end of June 2004.

"The CreditWatch listing reflects the planned acquisition of Prime
by affiliates of The Blackstone Group for $12.25 per share, or a
total value of more than $790 million including debt," said
Standard & Poor's credit analyst Sherry Cai.  The transaction is
expected to close in the fourth quarter of 2004, subject to
shareholder approval and other customary conditions.


QUESTERRE: Receives Court Approval for Corporate Restructuring
--------------------------------------------------------------
Questerre Energy Corporation (QEC:TSX) received Court approval for
the plans of arrangement proposed by the Company and its wholly
owned subsidiary, Questerre Beaver River Inc. -- QBR -- for the
settlement of all outstanding claims.

The Plans were approved and sanctioned today pursuant to the Order
granted by the Court of Queen's Bench of Alberta under the
Companies' Creditors Arrangement Act.  This follows the creditor
meetings held on August 31, 2004 when the requisite majority of
voting creditors approved the Plans.  In conjunction with QBR,
Questerre will now proceed with the implementation of these Plans
through the distribution of cash and Common Shares to all the
unsecured creditors.

Questerre anticipates the Plans will be implemented within the
next three weeks.  Subject to the successful implementation of the
Plans, Questerre anticipates emerging from CCAA protection prior
to September 30, 2004.

Questerre Energy Corporation is a Calgary-based independent
resource company actively engaged in the exploration for and
development, production and acquisition of large-scale natural gas
projects in Canada.


QWEST COMMS: Subsidiary Completes Tender Offer for Debt Securities
------------------------------------------------------------------
Qwest Corporation (QC), a wholly owned subsidiary of Qwest
Communications International Inc. (NYSE: Q), closed its previously
announced tender offer for approximately $750 million of aggregate
principal amount of outstanding 7.20 percent notes due November 1,
2004.

A total of approximately $569 million, representing 76 percent of
the outstanding, in principal amount of QC notes maturing in 2004,
were tendered prior to the expiration, and have been accepted and
paid.

The offer expired at midnight EDT, on Wednesday, Sept. 8, 2004,
and final settlement of notes tendered after the Early
Participation Deadline on Aug. 24, 2004, was completed Thursday,
Sept. 9.

Lehman Brothers and Goldman, Sachs & Co. were the dealer managers
for the offer.

                       About Qwest

Qwest Communications International, Inc., (NYSE:Q) is a leading
provider of voice, video and data services.  With more than 40,000
employees, Qwest is committed to the "Spirit of Service" and
providing world-class services that exceed customers' expectations
for quality, value and reliability.  For more information, visit
the Qwest Web site at http://www.qwest.com/

Qwest's June 30, 2004, balance sheet shows a stockholders' deficit
totaling $1,909,000,000 -- swelling 53% from the $1,251,000,000
shareholder deficit reported at March 31, 2004.


REPTRON ELECTRONICS: Facility Inks New Prod. Pact with Hunt Tech.
-----------------------------------------------------------------
Reptron Electronics, Inc. (OTC Bulletin Board: RPRN), an
electronics manufacturing services company, says its Hibbing, MN
facility has been awarded a multi-million dollar production
contract from Hunt Technologies, Inc., a leading global provider
of automatic meter reading products.

Reptron will build RF-based electronic sub-assemblies for
Minnesota-based Hunt's Multi-Utility Turtle(R) system, which uses
a utility's existing power lines to transmit and collect daily
usage, leak detection and tamper detection data from electric, gas
and water meters.

"This new program with Hunt builds upon the successful
manufacturing partnership Reptron has enjoyed with Hunt and has
the potential to double our level of business conducted with
them," said Charlie Crep, Reptron Manufacturing Services' vice
president of operations. "We have been providing Hunt Technologies
with an array of devices supporting their various automatic meter
reading product lines since 1998," Mr. Crep said. Production on
the new program will begin this fall.

                  About Hunt Technologies, Inc.

Hunt Technologies employs innovative technology to deliver an
endpoint information system that increases operational efficiency
while optimizing the utility investment dollar. With more than 450
customers worldwide, Hunt is a market leader in the automatic
meter reading industry. For more information on Hunt Technologies,
visit http://www.turtletech.com/

                           About Reptron

Reptron Electronics, Inc. is a leading electronics manufacturing
services company providing engineering services, electronics
manufacturing services and display integration services. Reptron
Manufacturing Services offers full electronics manufacturing
services, including complex circuit board assembly, complete
supply-chain services and manufacturing engineering services to
OEMs in a wide variety of industries. Reptron Display and System
Integration provides value-added display design engineering and
system integration services to OEMs. For more information, please
access http://www.reptron.com/

Reptron filed a voluntary petition for reorganization under
Chapter 11 of the U.S. Bankruptcy Code on October 28, 2003. The
Plan of Reorganization was confirmed by the U.S. Bankruptcy Court
on January 14, 2004 and became effective on February 3, 2004
allowing the Company to emerge from bankruptcy.


RIDDELL BELL: Moody's Assigns Single-B Ratings to Notes & Credit
----------------------------------------------------------------
Moody's Investors Service has assigned a B1 senior implied rating
to Riddell Bell Holdings, Inc., and rated the company's proposed
$160 million senior secured credit facilities and $140 million
senior subordinated notes at B1 and B3, respectively.  In
addition, Moody's has assigned a speculative grade liquidity
rating of SGL-3.  Transaction proceeds will fund the acquisition
of Bell Sports and its combination with Riddell Sports.  The long-
term ratings recognize the high debt levels and limited free cash
flow resulting from the acquisition, and therefore the limited
flexibility that exists for unexpected operating challenges.
Nonetheless, the ratings are supported by the company's strong
brands and stable, leading market positions, and by credible plans
to leverage the scale, product development capability, and
operational expertise of the two businesses.  The rating outlook
is stable.  Although Moody's has rated both Riddell and Bell under
different ownership, management and corporate structures, this is
the first time it has rated Riddell Bell Holdings, Inc.

These ratings were assigned:

   * Senior implied rating, B1;

   * $50 million senior secured revolving credit facility due
     2010, B1;

   * $110 million senior secured term loan B facility due 2011,
     B1;

   * $140 million senior subordinated notes due 2012, B3;

   * Senior unsecured issuer rating, B2;

Speculative grade liquidity rating, SGL-3.

Proceeds from the debt transactions, along with $69 million in
equity contribution from an investment group led by Fenway
Partners, will fund the acquisition of Bell Sports and the
refinancing of Riddell's debt.  The total purchase price will be
approximately $242.5 million (excluding transaction fees), or
around 8.5x Bell's adjusted LTM EBITDA at June 2004.  Fenway
purchased Riddell in 2003 for around $140 million, with an equity
contribution of nearly $70 million.  Moody's recognizes that the
combination of Riddell with Bell helps to moderate the significant
leverage assumed in connection with the Bell acquisition.

Notwithstanding this benefit, Riddell Bell's ratings are
restrained by still meaningful leverage levels following the
business combination that will require cash interest expenses and,
along with integration-related costs, will limit free cash flow
generation and debt repayment in the near-to-medium term.  Moody's
believes that the company's limited financial flexibility is
particularly concerning due to its:

   * low-growth product categories;

   * potential unexpected integration/restructuring charges;

   * product liability risks present in selling head protection
     products; and

   * possible challenges related to the Bell business.

In this last regard, Moody's notes that the majority of Bell's
sales are to mass retailers, including certain challenged
retailers, and that increasing sales concentration in all retail
channels could pressure sales and profits.  Further, the ratings
recognize the material new product development demands required to
sustain sales and profit margins in the bike accessories business
(one of Bell's largest product categories), and the company's
focus on growing new helmet categories that could require
significant time and investment before turning profitable.

The ratings and stable outlook are supported by Riddell Bell's
strong brands, its dominant market positions in all product sub-
sectors, and its historical product innovations that underpin the
company's valuation.

Despite high leverage and modest cash flows, Moody's recognizes
Riddell Bell's ability to meet required debt service under stable
operating conditions, while executing necessary growth investment
and integration spending plans.  In addition to the strong brand
positions, cash flow reliability is supported by Riddell's stable
business model, including the recurring sales offered:

   * by its reconditioning business;

   * by stable participation rates in its core sports categories
     and increasing head protection demand in these and several
     other sports;

   * by low capital spending and operating efficiency gains at
     Bell due to restructuring initiatives implemented over the
     past few years; and

   * by significant NOL's ($100M), including those created by the
     transaction.

Riddell maintains the number one market position in football
helmets (54%, supported by its marketing relationship with the
National Football League), in football shoulder pads, and in the
stable and complementary football equipment reconditioning market.
Bell has the leading market share in mass and specialty bike
helmets (Bell and Giro brands around 60%), in snow helmets (38%),
and in mass bike accessories, as supported by its athlete
endorsements and sponsorships.  Together the companies will have
the opportunity to leverage head protection R&D and design, while
Riddell should benefit from Bell's more sophisticated sourcing,
manufacturing, and product development capabilities.  Bell will
benefit from the product and customer diversification offered by
Riddell, which sells to over 19,500 institutional customers with
minimal annual account turnover.  Credible sales growth drivers at
both companies exist, including Riddell's Revolution product,
Bell's specialty product categories, and Bell's return into power-
sports.

Given these strengths, Moody's expects Riddell Bell to sustain and
improve upon its somewhat weak pro forma June 2004 credit metrics
(excluding seasonal impacts):

   * debt-to-EBITDA 5.2x,
   * EBITDA less capex interest coverage 2.3x, and
   * free cash flow to funded debt around 5.5%.

Moody's does not anticipate positive rating pressures over the
coming twelve months given the integration concerns and limited
debt repayment prospects, but could consider favorable actions
over the longer-term through a successful integration effort and
greater than expected de-leveraging.

Conversely, negative rating actions could be prompted by:

   * the inability to sustain sales and profit levels due to
     unexpected integration/restructuring challenges,

   * failed product development efforts, or

   * severe pricing pressures, especially if these issues
     constrain the company's borrowing access.

Moreover, negative rating actions would likely result if Riddell
Bell deviates from its near-term strategic objectives of
integration and debt-reduction, and engages in additional debt-
financed acquisitions.  In particular, Moody's would likely
consider negative rating actions if credit metrics (excluding
seasonal impacts) decline such that leverage increases beyond
5.5x, interest coverage declines below 2.0x, or free cash flow
turns negative.

The SGL-3 rating recognizes the adequate liquidity provided by
Riddell Bell's proposed $50 million revolving credit facility.
Moody's believes that the size of the facility provides sufficient
borrowings to meet the company's seasonal working capital demands
under normal operating conditions.  Further, Moody's anticipates
customary covenant levels (set around 18-20% relative to FY2004
projections), thereby providing an adequate cushion for smooth
borrowing access should the company experience moderate operating
challenges.  However, the SGL rating is materially constrained by
modest cash flow generation expectations and minimal cash
balances, which heighten the company's reliance on the facility
both for seasonal purposes and potentially to meet unexpected
operating expenses.  The SGL rating is further constrained by
Riddell Bell's limited alternative liquidity sources, as the vast
majority of the company's assets will be pledged to the rated
facilities.

The senior secured credit facilities are rated at the B1 senior
implied level due to their significant position in the pro forma
debt structure and the fact that tangible asset support may not be
sufficient to fully cover borrowings in a distressed scenario.
However, Moody's notes that the company's powerful brands could
provide intangible asset support.  The facilities will be
guaranteed by an intermediate parent holding company and by
domestic subsidiaries, and will be will be secured by all tangible
and intangible assets of the company and guarantors.  In addition,
the facilities will be secured by 100% of the capital stock of the
company and its domestic subsidiaries, by 65% of the capital stock
of foreign subsidiaries, and by all inter-company debt.  Financial
covenants will include minimum interest coverage, maximum capital
expenditures, and maximum leverage.  Mandatory prepayments will be
initially set at 75% of excess cash flow, subject to reduction to
50% if certain leverage levels are met.  The B3 rating on the
senior subordinated notes reflects their contractual and effective
subordination to a material amount of senior secured debt.  As
such, a high EBITDA multiple would be required to fully-return
principal under a distressed scenario.

Riddell Bell Holdings, Inc., is the prospective owner of Riddell
Sports Group, Inc., and Bell Sports Corporation, which are the
leading brands in football and bike helmets, respectively.  Pro
forma sales for the twelve-month period ended June 2004 were
approximately $323 million.


RIDDELL BELL: S&P Assigns B+ Corporate Credit Rating
----------------------------------------------------
Standard & Poor's Ratings Services assigned a 'B+' corporate
credit rating to sporting goods company Riddell Bell Holdings
Inc., a new entity formed from the combination of Riddell Sports
Group, Inc., and Bell Sports Corp.  A series of debt offerings
will be used to help finance the acquisition of Bell Sports and
repay existing debt at Riddell Sports Group, a subsidiary of the
newly formed entity.

An investor group led by financial sponsor Fenway Partners Inc.
will make a $69 million common equity contribution to help fund
the transaction and then own the new company.

Standard & Poor's has assigned a 'BB-' senior secured bank loan
and '1' recovery rating to Riddell Bell's planned $160 million
senior secured bank facility, issued as part of the transaction.
The '1' recovery rating indicates a high expectation of full
recovery of principal (100%) in the event of a default.

Standard & Poor's also assigned a 'B-' rating to Riddell Bell's
planned $140 million senior subordinated note offering due 2012.
This offering will be issued under Rule 144A with registration
rights.

The ratings are based on preliminary information and subject to
review upon receipt of final documentation.

The outlook is negative.  About $254 million of total debt will be
outstanding at Riddell Bell upon closing of the transaction.

"The ratings reflect the new entity's high debt leverage," said
Standard & Poor's credit analyst Patrick Jeffrey.  "They also
reflect Riddell Bell's participation in the highly competitive
sporting goods industry, its narrow product focus, its customer
concentration, and the risks of integrating the two operations.
These risks are mitigated somewhat by the company's leading market
positions in football and bike helmets and related accessories."

The highly competitive sporting goods industry is fragmented in
both its manufacturing and in its retail distribution. Meanwhile,
Riddell Bell has a somewhat narrow product focus in football and
bike helmets and accessories, its primary product offerings.
Combined, these product categories represent about 77% of the
company's total sales, and the rest is generated by snow helmets,
fitness products, and other items.  Product liability remains a
significant business and financial risk that requires the company
to maintain adequate insurance in order to cover potential claims
against its products.

Organic growth in the football and bike helmet segments is
expected to be moderate but stable in the intermediate term, yet
the company could also grow with tuck-in acquisitions and
extensions of existing products.  The ratings do not anticipate
any further large, debt-financed acquisitions.


RUSSELL CORP: Names Robert Koney, Jr., Chief Financial Officer
--------------------------------------------------------------
Russell Corporation (NYSE: RML) named Robert D. Koney, Jr. chief
financial officer for the company.  Koney, 47, will be responsible
for all corporate financial areas as well as investor relations.
He will join the company September 15 and it is anticipated that
he will be elected a senior vice president of the corporation at
the Board of Directors meeting in October.

"We are extremely pleased to have someone with Bob's experience in
corporate finance joining our team," said Jack Ward, chairman and
CEO.  "His extensive involvement in all areas of finance will
certainly be beneficial to Russell as we go forward with our
efforts to build a global sporting goods company."

Koney will be joining Russell from Goodrich Corporation, where he
has been since 1986.  He joined Goodrich as general accounting
manager in the specialty chemicals group and then moved to the
aerospace segment as assistant controller.  In 1994, he was
promoted to vice president and controller of the aircraft wheel
and brake operations for BF Goodrich Aerospace.  After four years
in that position, he was named vice president, controller and
chief accounting officer for the corporation and has remained in
that position since 1998.

Prior to Goodrich, Koney had been manager of federal taxation with
Picker International for four years and a senior tax accountant.
He began his career as a staff auditor with Arthur Andersen &
Company in 1978.

Koney graduated cum laude from the University of Notre Dame with a
B.B.A. degree in accounting and earned his M.B.A. degree from Case
Western Reserve University.  He received his Certified Public
Accountant designation in 1980.

Russell Corporation is a leading branded athletic and sporting
goods company with over a century of success in marketing athletic
uniforms, apparel and equipment for a wide variety of sports,
outdoor and fitness activities.  The company's brands include:
Russell Athletic(R), JERZEES(R), Spalding(R), AAI(R), Huffy
Sports(R), Mossy Oak(R), Bike(R), Moving Comfort(R), Dudley(R),
Cross Creek(R) and Discus(R).  The company's common stock is
listed on the New York Stock Exchange under the symbol RML and its
website address is http://www.russellcorp.com/

                         *     *     *

As reported in the Troubled Company Reporter on June 4, 2004,
Standard & Poor's Ratings Services lowered its corporate credit
rating on athletic apparel manufacturer Russell Corp. to 'BB' from
'BB+'.  At the same time, the senior unsecured debt rating was
lowered to 'BB-' from 'BB'. The unsecured debt is rated one notch
below the corporate credit rating, reflecting its junior position
in the capital structure relative to the secured bank debt.  The
outlook is stable.  Total debt outstanding was about $335 million
at April 4, 2004.

The ratings downgrade follows Standard & Poor's review of Russell
Corp., reflects the company's weakened financial measures for
fiscal 2003, and incorporates the uncertainty as to when credit
measures will recover.  The company, in furthering its goal of
becoming an athletic and activewear company, has completed three
acquisitions in a relatively short period.  These transactions
represent a more aggressive financial policy with related
integration risk. Although Russell's revenues for fiscal 2003
increased by 1.9% due to unit volume gains, operating margins
declined by 300 basis points as a result of a very competitive
pricing environment within Russell's Artwear and mass retail
channels, excess industry capacity within Artwear, higher raw
material costs, and the weak economy.  Standard & Poor's expects
these trends to persist throughout 2004.  Furthermore, Russell
continues to face intense competition in the athletic market, at
times from much larger and financially stronger players, such as
NIKE Inc. and Reebok International Ltd.

The ratings on Atlanta, Georgia-based Russell reflect the
company's participation in the highly competitive and volatile
apparel industry, a narrow product focus, and some commodity-like
products within the company's portfolio. Somewhat mitigating these
factors is the company's well-known brand name, its strong market
position, and its moderate financial profile.


SANRE REALTY CORPORATION: Voluntary Chapter 11 Case Summary
-----------------------------------------------------------
Debtor: Sanre Realty Corporation
        1562 Minford Place, Suite 5
        Bronx, New York 10460

Bankruptcy Case No.: 04-15870

Type of Business: Real Estate

Chapter 11 Petition Date: September 9, 2004

Court: Southern District of New York (Manhattan)

Judge: Burton R. Lifland

Debtor's Counsels: Stuart Irwin Davis, Esq.
                   2931 Westchester Avenue
                   Bronx, New York 10461
                   Tel: (718) 319-1388
                   Fax: (718) 931-7606

Total Assets: $1,500,200

Total Debts: $$750,000

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


SCOTT ACQUISITION: Case Summary & 20 Largest Unsecured Creditors
----------------------------------------------------------------
Cherry

Leading Debtor: Scott Acquisition Corp.
                5300 Recker Highway
                Winter Haven, Florida 33880

Bankruptcy Case No.: 04-12594

Debtor affiliates filing separate chapter 11 petitions:

      Entity                                     Case No.
      ------                                     --------
Scotty's, Inc.                                   04-12595

Type of Business: The Debtors are retailers of a wide range of
                  building materials and home improvement
                  products serving the "do-it-yourself" market
                  for individual homeowners, as well as the
                  professional builder and commercial markets.
                  See http://www.scottys.com/

Chapter 11 Petition Date: September 10, 2004

Court: District of Delaware (Delaware)

Judge: Peter J. Walsh

Debtor's Counsels: Brendan Linehan Shannon, Esq.
                   Young, Conaway, Stargatt & Taylor
                   The Brandywine Building
                   1000 West Street, 17th Floor
                   PO Box 391
                   Wilmington, Delaware 19899-0391
                   Tel: 302 571-6600
                   Fax: 302-571-1253

Total Assets: $45,681,000

Total Debts: $30,068,000

Debtors' 20 Largest Unsecured Creditors:

    Entity                    Nature Of Claim       Claim Amount
    ------                    ---------------       ------------
Florida Self-Insurers         Workmans'               $4,300,000
Guaranty Association Inc.     Compensation
200 West College Avenue       Insurance Claims
Suite 115
Tallahassee, Florida 32301-7710

Do-It-Best Corporation        Trade Debt              $3,700,000
PO Box 868
Fort Wayne, Indiana 46801-0868

Bluelinx Corporation          Trade Debt                $500,000
PO Box 102110
Atlanta, Georgia 30368-0110

CCA Financial LLC             Equipment Leases          $347,434
PO Box 25549
7275 Glen Forrest Drive
Suite 100
Richmond, Virginia 23278

Coast to Coast Building P     Trade Debt                $180,925

Weyerhaeuser Company, Inc.    Trade Debt                $116,977

Crawford & Company            General Liability         $134,340
                              Insurance Claims

Great Southern Woods Pres.    Trade Debt                $112,393

Aljoma Lumber                 Trade Debt                 $96,740

AMW Brevard LLC               Landlord                   $94,580

Bill Williams A/C             Trade Debt                 $87,600

Quikrete of Florida           Trade Debt                 $84,664

Broad and Cassel              Trade Debt                 $84,001

Anne And Gabriel Willie       Landlord                   $61,133

Nextel                        Trade                      $60,791

Tarmac America LLC            Trade Debt                 $58,685

Fountain Court                Landlord                   $57,954
Acquisition Limited

Wayne Associates              Landlord                   $55,025

Rand Industries, Inc.         Landlord                   $51,940

2323 Tamiami LLC              Landlord                   $45,743


SPIEGEL: Eddie Bauer Opens Outlet at The Shops at Briargate
-----------------------------------------------------------
Eddie Bauer, a premium outdoor-inspired casual wear brand, opened
at The Shops at Briargate on August 25, 2004.  The newest Eddie
Bauer location offers outdoor-inspired apparel for men and women,
along with outerwear, gadgets and travel accessories.  The
Briargate store features wrinkle-resistant shirts in five styles
and seven lush colors for women and men's styles in solids,
stripes and plaid poplins.

"A city like Colorado Springs, set in the midst of world famous
natural beauty, is a natural location for Eddie Bauer, the
premium outdoor-inspired casual wear brand.  We are excited to be
opening at The Shops at Briargate and look forward to providing
the residents of Colorado Springs with apparel to live, work and
play in," said Lisa Erickson, Eddie Bauer spokesperson.

The Shops at Briargate location is Eddie Bauer's second location
in Colorado Springs.  The company also operates an apparel store
at Citadel Mall and at more than 300 locations throughout North
America.

Eddie Bauer's 4235-square foot store is located at 1845 Briargate
Parkway, Suite 411.  Store hours are Monday to Saturday from 10
a.m. to 9 p.m. and Sunday from 11 a.m. to 6 p.m.  For more
information on The Shops at Briargate location, call 719-265-
6869.

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.


SOLUTIA INC: Reports Status of Flexsys Related Litigation
---------------------------------------------------------
Antitrust authorities in the United States, Europe and Canada are
investigating past commercial practices in the rubber chemicals
industry.  In a recent filing with the Securities and Exchange
Commission, Solutia, Inc., relates that Flexsys America, LP, its
50/50 joint venture with Akzo Nobel N.V., is a subject of such
investigation and has been fully cooperating with the authorities.
In addition, a number of purported class actions have been filed
against Flexsys and other producers of rubber chemicals.

                     Actions Against Flexsys

A purported class action has been filed in the Massachusetts State
Court against Flexsys and other past and present rubber chemical
producers on behalf of all indirect consumers of rubber chemicals
for damages sustained as a result of alleged anti-competitive
practices in the sale of rubber chemicals.  In addition to the
Massachusetts case, 13 state court actions filed by retail tire
purchasers against Flexsys and other producers of rubber chemicals
remain pending either on appeal or at the trial court level in
preliminary motion phases.

On July 15, 2004, RBX Industries, Inc., filed a lawsuit against
Flexsys and other producers of rubber chemicals in the United
States District Court for the Western District of Pennsylvania.
RBX alleges that from 1995 to 2001 Flexsys and other defendants
conspired through marketing and sales practices to cause RBX to
pay supra-competitive prices.  RBX seeks treble damages from
Flexsys and other defendants.  Solutia is not a named defendant in
any of these cases.

In May 2004, two purported class actions were filed in the
Province of Quebec Canada against Flexsys and other rubber
chemical producers alleging that collusive sales and marketing
activities of the defendants damaged all persons in Quebec during
July 1995 through September 2001.  Statutory damages of
CN$14,600,000 along with exemplary damages of CN$25 per person are
being sought.  A hearing is tentatively scheduled to determine
which case will be allowed to go forward.  Solutia is not a named
defendant in either of these class actions.

                   Class Action Against Solutia

Certain individuals brought a consolidated class action before the
U.S. District Court for the Northern District of California
against Solutia and certain other individual defendants.  These
individuals alleged that they purchased Solutia stock at inflated
prices as a result of the incorporation of Solutia's share of
Flexsys' financial results, which were purportedly inflated as a
result of anticompetitive collusion between Flexsys and other
rubber chemical producers during the period December 1998 through
October 2002.  The consolidated action has been automatically
stayed with respect to Solutia by virtue of Section 362(a) of the
Bankruptcy Code but has not been stayed with respect to the
individual defendants.  On July 28, 2004, the California District
Court granted the individual defendants' request to dismiss the
complaint for failure to state a claim but also granted the
plaintiffs 10 days to file an amended compliant.

Headquartered in St. Louis, Missouri, Solutia, Inc. --
http://www.solutia.com/-- with its subsidiaries, make and sell a
variety of high-performance chemical-based materials used in a
broad range of consumer and industrial applications. The Company
filed for chapter 11 protection on December 17, 2003 (Bankr.
S.D.N.Y. Case No. 03-17949). When the Debtors filed for protection
from their creditors, they listed $2,854,000,000 in assets and
$3,223,000,000 in debts.  (Solutia Bankruptcy News, Issue No. 22;
Bankruptcy Creditors' Service, Inc., 215/945-7000)


SUMMITVILLE TILES: Files Chapter 11 Plan of Reorganization
----------------------------------------------------------
Summitville Tiles, Inc., delivered its chapter 11 Plan of
Reorganization to the U.S. Bankruptcy Court for the Northern
District of Ohio, Eastern Division.  A full-text copy of the Plan
is available for a fee at:

    http://www.researcharchives.com/bin/download?id=040812020022

The Plan groups creditors and interest holders into eight classes
and describes the treatment of each:

    Class                           Treatment
    -----                           ---------
1 - State of Ohio Claim         Unimpaired. Loan agreements
                                between the Director and Debtor
                                will reinstated on the Effective
                                Date.

2 - Other Secured Claims        Unimpaired. After the Effective
                                Date, holders will receive in
                                full satisfaction its Allowed
                                Claim at the option of the
                                reorganized Debtor:
                                a) the net proceeds of the sale
                                   of the property securing such
                                   Claim, up to the amount of
                                   the Allowed Secured Claim;
                                b) the return of the property
                                   securing such Claim;
                                c) payments in accordance with
                                   the provisions of any
                                   agreement relating to the
                                   property, on substantially
                                   the same terms as such
                                   agreement; or
                                d) cash equal to the value of
                                   the property securing such
                                   Claim, up to the amount of
                                   the Allowed Secured Claim of
                                   such holder.

                                In the event that property
                                securing such Claim is returned
                                or sold and, after the proceeds
                                thereof are paid to such holder,
                                a portion of the amount owed to
                                such holder remains unpaid, such
                                unpaid portion will be treated
                                as an Unsecured Claim.

3 - OBWC Claim                  Unimpaired. Will be paid in full
                                either:
                                a) cash
                                       i) equal to the value of
                                          the property securing
                                          the Claim;
                                      ii) equal to the amount of
                                          all claims secured by
                                          liens senior to any
                                          lien of OBWC, to be
                                          paid in 15 days of the
                                          date of determination
                                          of such amount by the
                                          Bankruptcy Court; or
                               b) cash in an amount agreed to by
                                  the OBWC and the Debtor, to be
                                  paid on the later of the
                                  Effective Date or two days
                                  following such agreement.

4 - Other Priority Claims     Unimpaired. At the reorganized
                              Debtor's option, each Allowed
                              Claim either:
                              a) have its Allowed Claim
                                 reinstated and paid pursuant to
                                 its terms; or
                              b) receive cash equal to the
                                 amount of its Allowed Claim.

5 - Lender's Claim           Impaired. The Lenders will receive,
                             in full satisfaction of their
                             Allowed Claim, the following:
                             a) on the Effective Date, a note
                                evidencing the Term Loan A
                               (defined in Article VI of the
                                Plan);
                             b) on the Effective Date, a note
                                evidencing the Term Loan B
                                (defined in Article VI of the
                                Plan);
                             c) on the Effective Date, a note
                                evidencing the Reorganized
                                Debtor's obligations under the
                                Revolving Credit Loan;
                             d) repayment of the Bridge Loan
                                from funds received by the
                                Debtor from the Director;
                             e) in about 6 months from the
                                Effective Date, the net
                                proceeds generated from
                                the sale of the slow moving
                                inventory;
                             f) in about 9 months from the
                                Effective Date, the net proceeds
                                generated from the sale of the
                                North Carolina Equipment; and
                             g) in about 12 months from the
                                Effective Date, the first $1.3
                                million in net proceeds plus
                                half of whatever excess
                                generated from the sale of the
                                North Carolina Plant plus all
                                net proceeds generated from the
                                sale of the North Carolina Plant
                                in excess of $1.8 million.  All
                                such proceeds will be applied
                                first to Term Loan A and then to
                                Term Loan B.

6 - Unsecured Claims        Impaired. Holders will receive on a
                            pro rata basis the proceeds of or
                            distributions on the following:
                            a) the Excess Cash Flow note;
                            b) the Agent Note; and
                            c) one half of the Net Proceeds in
                               excess of $1.3 generated from the
                               sale of the North Carolina Plant
                               up to $250,000.

7 - Related Party Claims    Impaired. Remains under the
                            obligation of the reorganized Debtor
                            but subordinated to Lenders and
                            Agent's Claims. The Johnson Secured
                            Debt will be paid prior to the
                            payment of any other Related Party
                            Claim. No payments will be made to
                            cover tax liabilities until the
                            Debtor's net operating losses or
                            other Subchapter S tax attributes
                            are exhausted.

8 - Interests               Impaired. On the Effective Date, the
                            existing Common Stock of the Debtor
                            will be cancelled and the holders
                            will receive new Common Stock of the
                            reorganized Debtor.

Headquartered in Summitville, Ohio, Summitville Tiles, Inc.,
manufactures tile and installation products including a complete
line of grouts, mortars, epoxies, furan, latex, water proofing and
tile care products. The Company filed for chapter 11 protection on
December 12, 2003 (Bankr. N.D. Ohio Case No. 03-46341). Matthew A
Salerno, Esq., and Shawn M Riley, Esq., at McDonald, Hopkins,
Burke & Haber Co LPA, represent the Debtor in its restructuring
efforts. When the Company filed for protection from its creditors,
it estimated debts and assets of more than $10 million.


SUPERIOR NAT'L: Liquidation Cues Moody's to Withdraw Junk Ratings
-----------------------------------------------------------------
Moody's Investors Service has withdrawn its ratings on Superior
National Insurance Group, Inc., and its subsidiaries.  Interest
payments on the company's guaranteed senior secured term loan
facility and trust preferred securities, both rated C prior to
withdrawal, have been suspended since April of 2000.  These
ratings have been withdrawn because the company has been and
remains in liquidation since September 26, 2000.  Please refer to
Moody's Withdrawal Policy on http://moodys.com/

These ratings were withdrawn:

   * Superior National Insurance Group, Inc.

     -- guaranteed senior secured term loan facility at C and
        senior subordinated notes at C;

   * Superior National Insurance Company

     -- insurance financial strength at Ca;

   * Superior Pacific Casualty Company

     -- insurance financial strength at Ca;

   * California Compensation Insurance Company

     -- insurance financial strength rating at Ca;

   * Commercial Compensation Insurance Company

     -- insurance financial strength rating at Ca;

   * Combined Benefits Insurance Company

     -- insurance financial strength rating at Ca;

   * Superior National Capital Trust I

     -- trust preferred securities at C.


TNP ENTERPRISES: Acquisition by PNM to Strengthen Fin'l Positions
-----------------------------------------------------------------
PNM Resources' (NYSE: PNM) acquisition of TNP Enterprises will
strengthen the financial positions of both companies and provide
savings resulting in modest rate decreases, according to filings
made with regulators in New Mexico and Texas.

Fort Worth-based TNP Enterprises is the parent company of Texas-
New Mexico Power Co., which serves 48,000 customers in southern
New Mexico and is the transmission and distribution company for
205,000 customers in Texas' competitive electric market. In July,
PNM Resources agreed to acquire the company.

"This transaction will provide a very real opportunity to return
TNP Enterprises to a healthier financial condition with no adverse
effect on PNM Resources or PNM the utility," said Bill Real, PNM
Resources senior vice president of Public Policy. "The acquisition
will result in savings in administrative and overhead costs."

According to the filing, cost of service rate reductions of less
than $1 per year for PNM gas customers would go into effect
immediately following the acquisition. PNM electric customers,
whose rates were cut 4 percent in 2003 and will see rates decrease
another 2.4 percent in 2005, will receive a rate credit from the
acquisition savings in January 2008, when the existing moratorium
on rate changes expires.

The filings ask for approval of the acquisition from the New
Mexico Public Regulation Commission and a finding from the Public
Utility Commission of Texas that the acquisition is in the public
interest. Additional federal approvals also are needed. PNM
Resources believes that all regulatory approvals can be obtained
in about six months due to the simple nature of the acquisition.

Real said the administrative savings would come from consolidating
administrative and overhead costs, such as computer systems,
licensing, software, insurance costs, bill printing, benefits
administrative fees, purchasing efficiencies and duplicative
positions.

According to the filing, PNM Resources will identify any possible
benefits of combining the utility operations of PNM and TNMP-New
Mexico and might propose to combine the operations when it files
for its next general electric rate proceeding.

                        About PNM Resources

PNM Resources is an energy holding company based in Albuquerque,
N.M. PNM, the principal subsidiary of PNM Resources, serves about
459,000 natural gas customers and 405,000 electric customers in
New Mexico. The company also sells power on the wholesale market
in the Western United States. PNM Resources stock is traded
primarily on the NYSE under the symbol PNM.

                      About TNP Enterprises

TNP Enterprises' primary subsidiary, Texas-New Mexico Power Co.,
was created in 1935. It provides community-based electric service
to 85 cities and more than 252,000 customers in Texas and New
Mexico. First Choice Power, TNP Enterprises' other primary
subsidiary, is a retail electric provider with more than 59,000
customers in Texas. First Choice began providing retail electric
service to Texas customers in 2002 in response to the Texas
Electric Choice Act. Headquartered in Fort Worth, Texas, the
company has 37 offices throughout its service areas and
approximately 750 employees in two states. More information about
the company can be found at http://www.tnpe.com/

                          *     *     *

As reported in the Troubled Company Reporter on July 28, 2004,
Standard & Poor's Ratings Services said that its 'BB+' corporate
credit ratings on utility holding company TNP Enterprises Inc. and
unit Texas-New Mexico Power Co. (TNMP) will remain on CreditWatch,
but that it will revise the CreditWatch implications to developing
from negative. The rating action follows TNP's announcement that
the utility holding company and its units, TNMP and retail
electric provider, First Choice Power (FCP), will be sold to PNM
Resources Inc. (BBB/Stable/A-2) for $1.024 billion. The
CreditWatch developing listing indicates that ratings may be
raised, lowered or affirmed.

The action affects about $800 million of rated debt and $175
million of preferred stock at the Fort Worth, Texas-based company.

"The revision of the CreditWatch listing to developing from
negative reflects the potential for a ratings upgrade based on the
stronger credit profile of PNM Resources," said Standard & Poor's
credit analyst Rajeev Sharma. "However, the developing
implications also reflect the pending nature of the transaction,
as regulatory approvals are required to successfully complete the
acquisition," he continued.

Without the successful completion of the sale, scheduled for the
end of 2005, TNP's ratings would be lowered due to the recent
adverse regulatory ruling associated with TNMP's 2004 true-up
proceeding with the Public Utility Commission of Texas (PUCT). The
PUCT order authorizes TNMP to recover $87 million in stranded
costs, as opposed to TNMP's request of $266 million in stranded-
cost recovery. Standard & Poor's is concerned that the order would
weaken credit metrics at the utility and holding company, and
delay the company's debt-reduction plans. These concerns would be
alleviated if the acquisition of TNP and its units are consummated
in a timely fashion.

Standard & Poor's will resolve the CreditWatch listing following a
meeting with TNP's and PNM's management and a full review of the
proposed transaction and financing plan.


TRICO MARINE: 67% of Sr. Noteholders Support Chapter 11 Pre-pack
----------------------------------------------------------------
Trico Marine Services, Inc. (Nasdaq: TMAR) says more than 67%
percent of the holders of the Company's $250 million 8-7/8 senior
notes due 2012 have agreed to support a consensual financial
restructuring of the Company.

"Friday's agreement is very positive news for all of Trico's
employees, customers and vendors. It will allow Trico to convert
100% of the Senior Notes into equity, which reduces the Company's
debt balance by $250 million and will permit Trico to emerge as a
financially stronger, more efficient company, giving us a
competitive advantage in the long run," said Thomas Fairley, Chief
Executive Officer of the Company.

The parties to the restructuring agreement have signed binding
agreements to support the restructuring on proposed terms, subject
to finalization of definitive agreements and related documentation
and the satisfaction of certain specified conditions. Based on
these agreements, the Company believes it has the support of the
requisite body of the holders of the Senior Notes to implement the
restructuring through a prepackaged or prearranged bankruptcy
case. Terms of the financial restructuring are:

   -- Each holder of the Senior Notes would receive, in exchange
      for its total claim (including principal and interest), its
      pro rata portion of 100% of the fully diluted new common
      stock of reorganized Trico Marine Services, Inc., before
      giving effect to:

         (i) the exercise of the warrants found below, and

        (ii) a new employee option plan.

   -- Holders of the Company's existing common stock would
      receive, on a basis to be determined, equity warrants that
      are exercisable into, in the aggregate, 10% of Reorganized
      TMAR's common stock (before giving effect to the new
      employee option plan).  The equity warrants would be
      structured as:

         * One tranche of warrants exercisable into 5% of
           Reorganized TMAR's common stock (before giving effect
           to the new employee option plan), with a five-year term
           beginning on the consummation of a plan of
           reorganization, and set at a strike price equivalent to
           an equity valuation of $187.5 million.

         * One tranche of warrants exercisable into 5% of
           Reorganized TMAR's common stock (before giving effect
           to the new employee option plan), with a three-year
           term beginning on the consummation of a plan of
           reorganization, and set at a strike price equivalent to
           an equity valuation of $250 million.

   -- On the effective date of a plan of reorganization, the sole
      equity interests in Reorganized TMAR would consist of new
      common stock issued to the holders of the Senior Notes, the
      equity warrants described above, and equity interests to be
      issued to employees.

   -- The Company's obligations under existing operating leases,
      or trade credit extended to the Company by its vendors and
      suppliers, would be unimpaired.

   -- All of the respective obligations of the Company and its
      subsidiaries pursuant to its $55 million U.S. term loan
      would be unimpaired.

   -- The Norwegian credit facility, including the NOK 150 Million
      Term Loan and the NOK 800 Million Term Loan, both
      obligations of Trico's Norwegian subsidiaries/affiliates,
      would be unimpaired by the restructuring.

   -- The MARAD notes issued by the domestic subsidiaries of
      Trico would be unimpaired by the restructuring.

Under the terms of the restructuring agreement, Thomas Fairley
will continue as Trico's Chief Executive Officer and Trevor
Turbidy will continue as Trico's Chief Financial Officer. Joseph
Compofelice will remain as Trico's non-executive Chairman of the
Board of Directors.

The financial restructuring would be effectuated through a
prepackaged or prearranged Chapter 11 plan of reorganization of
TMAR, Trico Marine Assets, Inc. and Trico Marine Operators, Inc.
The Company does not anticipate, nor does the agreement
contemplate, that any of its foreign subsidiaries, affiliates or
assets would be subject to any Chapter 11 filing, bankruptcy
proceeding or any other similar reorganization or insolvency
proceeding.

"With this level of support from our noteholders, I am very
optimistic that Trico will emerge quickly from Chapter 11," said
Fairley. "This restructuring should have little, if any, impact on
Trico's day-to-day operations. In particular, the restructuring
process should in no way compromise or disrupt our ability to
serve our customers throughout the world."

The Company expects to begin negotiating the final forms of the
relevant documents with the holders of the Senior Notes
immediately. The Company plans to commence the formal process of
soliciting acceptances from all parties entitled to vote on the
restructuring plan within a few weeks. If the Company receives the
required acceptances from the holders of the Senior Notes, it
intends to commence a voluntary chapter 11 case in the fourth
quarter of 2004, with the objective of consummating the
restructuring in the first quarter of 2005.

The restructuring agreement reached between Trico and the
applicable holders of the Senior Notes covers the broad economic
terms of the financial restructuring and not all material terms
expected to be contained in a plan of reorganization. The parties
to the restructuring agreement have signed binding agreements to
support the restructuring on the proposed terms, subject to
finalization of definitive agreements and documentation and the
satisfaction of certain specified conditions.

Full-text copies of the term sheet and Plan Support Agreements are
fully described in the Company's Form 8-K filed with the
Securities and Exchange Commission at:


http://www.sec.gov/Archives/edgar/data/921549/000090628004000372/0000906280-
04-000372-index.htm

In connection with the proposed financial restructuring of the
Company, the Company has been represented by Lazard Freres & Co.
LLC as financial advisors and Kirkland & Ellis LLP as legal
advisors.

Trico provides a broad range of marine support services to the oil
and gas industry, primarily in the Gulf of Mexico, the North Sea,
Latin America, and West Africa. The services provided by the
Company's diversified fleet of vessels include the marine
transportation of drilling materials, supplies and crews, and
support for the construction, installation, maintenance and
removal of offshore facilities. Trico has principal offices in
Houma, Louisiana and Houston, Texas. Please visit our website at
http://www.tricomarine.com/

                          *     *     *

As reported in the Troubled Company Reporter on August 19, 2004,
Trico Marine Services, Inc.'s independent registered public
accounting firm reissued its report on the Company's financial
statements for the year ended December 31, 2003 with a going
concern explanatory paragraph in the Company's amendment to its
Form 10-K for the fiscal year ended December 31, 2003.

The Company originally filed its 2003 Form 10-K on March 15, 2004
and filed the Form 10-K amendment on August 9, 2004 in order to
respond to comments received from the staff of the Securities and
Exchange Commission regarding the classification of indebtedness
under the Company's Norwegian revolving credit facility.

Due to the Company's 10-K amendment, the Company's independent
registered public accounting firm was required to reissue its 2003
audit report. As previously announced, during the second quarter
of 2004, the Company defaulted under its $250 million senior
unsecured notes indenture and, due to cross-default provisions,
its $55 million secured term loan facility. Although neither the
maturity of the senior unsecured notes nor that of the secured
term loan facility has been accelerated as of the date of this
announcement, in the opinion of the Company's independent
registered public accounting firm, these events raised substantial
doubt about the Company's ability to continue as a going concern.


UNITED AIR: Names Sean Donohue United Express & Ted Vice-President
------------------------------------------------------------------
United Airlines (OTC Bulletin Board: UALAQ) reported that the two
United Express groups -- operational and business management --
will be combined into a single organization, effective
immediately.  Sean Donohue will head the organization as vice
president-United Express and Ted.

"I'm pleased that Sean Donohue is able to take on this additional
responsibility while continuing to direct the operation of Ted,
which has consistently delivered positive results since its launch
this past February," said Glenn Tilton, Chairman, Chief Executive
Officer and President.  "United Express is a key element of our
product portfolio, and will greatly benefit from Sean's leadership
and what we've learned from the highly successful launch of Ted."

Greg Kaldahl, director-United Express and Cindy Szadokierski,
managing director-United Express, will report to Donohue.

"The new United Express organization provides a single point of
contact for our United Express carriers, and it solidifies the
value of partnership that will drive business and product
improvements," said Donohue.  "The new organization will leverage
the expertise and resources that exist throughout United Airlines,
and we look forward to working with these groups to support the
consistent delivery of operational and customer excellence with
our United Express product."

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 Debtors filed
for protection from their creditors, they listed $24,190,000,000
in assets and $22,787,000,000 in debts.


US AIRWAYS: Files for Chapter 22 Protection in E.D. Virginia
------------------------------------------------------------
September 12, 2004 / PR Newswire

US Airways Group, Inc. (Nasdaq: UAIR) and certain of its
subsidiaries filed voluntary petitions for reorganization under
Chapter 11 of the U.S. Bankruptcy Code. The Company said that
yesterday's action will provide the nation's seventh-largest
airline the opportunity to implement its Transformation Plan built
on lower costs, a simplified fare structure, and expanded service
in the eastern U.S., the Caribbean, Latin America and Europe.

"We have devoted the last six months to building and implementing
a Transformation Plan that leverages our strengths and allows us
to compete successfully in a changing airline industry," said US
Airways President and Chief Executive Officer Bruce R. Lakefield.
"Since we still lack the new labor agreements that are needed for
the Transformation Plan to succeed, we must preserve the Company's
cash resources that are required to implement the Plan. We have
made the difficult but necessary decision to complete this process
with the help of the Court."

Customers should notice no changes to flight operations or
customer service programs because of the filing. The company
intends to ask the Court to allow it to assume all key agreements
related to its Dividend Miles program and the co-branded Bank of
America/ Dividend Miles credit card. In addition, employees will
be paid and their benefits will continue, and the operation of
usairways.com will be unaffected. Vendors will be paid in ordinary
course for goods and services provided going forward.

US Airways faced Sept. 30 covenant tests relating to its Air
Transportation Stabilization Board loan. Additionally, expiring
financing agreements with General Electric, Bombardier and
Embraer, among others, required that the key elements of its
Transformation Plan -- including lower labor costs -- be
implemented by September 30. With cash obligations quickly coming
due and the potential for defaults with some creditors imminent,
the Chapter 11 filing became necessary to preserve cash and allow
the Court to oversee the Company's continued restructuring,
including reaching new labor agreements. Despite efforts
undertaken for several months with its major work groups, the
company was unable to reach out-of-court negotiated agreements.

Mr. Lakefield said that US Airways has made tremendous strides
since its emergence from Chapter 11 in March 2003, and that the
key elements of that original plan, such as lower labor costs, the
expansion of RJ flying, participation in the Star Alliance, and
lower aircraft lease and vendor costs, all contributed to US
Airways successfully securing a federal loan guarantee from the
ATSB. The airline had already reduced annual operating expenses by
almost $2 billion during its 2002-2003 restructuring, but the
dramatic growth of low-cost carriers (LCCs), unabated fuel price
increases and the public's demand for lower, simpler fares
requires that the Company do more to achieve an even more
competitive cost structure that is competitive to LCCs.

As a result of these external factors, US Airways' 2004 fuel costs
are expected to be approximately $300 million higher than
envisioned in the confirmed plan of reorganization, and mainline
passenger revenues are expected to be $450 million lower than
forecast, as overall industry unit revenue continues to decline.

"We are facing the difficult choices and the pressures that every
legacy airline is going to be facing over the next several years,"
said Mr. Lakefield. "It is no fun being first, and we take no
pleasure in asking our employees to make additional sacrifices.
However, we have come too far and accomplished too much to simply
stop the process and not succeed. With our strong position on the
East Coast and our growing presence in Europe, the Caribbean and
Latin America, our dedicated employees, and more than 4 million
active Dividend Miles members, a restructured US Airways with low
costs and low fares will be a dynamic competitor."

The Company filed its petitions on Sunday afternoon in the U.S.
Bankruptcy Court for the Eastern District of Virginia in
Alexandria. The Company's petitions listed assets of approximately
$8.8 billion, including $2.5 billion of Goodwill, and liabilities
of approximately $8.7 billion. The Court has scheduled a hearing
on the Company's first day motions for 10:30 a.m. in Courtroom #1
at the Martin Bostetter, Jr. U.S. Courthouse. Information on the
filing and related matters can be found at
http://www.transformingusairways.com/

The Company has been operating with cash obtained from a $1
billion loan, $900 million of which was guaranteed by the ATSB.
The ATSB and the other lenders (Retirement Systems of Alabama
Holdings LLC (RSA) and Bank of America, N.A.) have agreed to
authorize US Airways continued use of those funds. Therefore, in
lieu of debtor-in-possession financing, US Airways will have
access to a portion of $750 million in cash -- which serves as one
component of the collateral supporting the ATSB loan -- as working
capital. The agreement between US Airways, the ATSB and the other
lenders will be presented to the Court at today's hearing. In
following bankruptcy procedures, a final order on operating cash
would then be presented to the Court at a later date.

The Company's current cash position is approximately $1.45 billion
in cash, cash equivalents and short-term investments. The
outstanding portion of the ATSB loan is $717.6 million.

"We have made it clear to union leaders and employees that we must
have competitive costs," said Mr. Lakefield. "Labor cost
reductions, including participation by senior management, are no
exception. We are committed to reaching new labor agreements
consensually because that is always in the best interest of all
parties, but if not, we will need to consider the other
alternatives provided for under the law."

Mr. Lakefield added that while the employee sacrifices are
difficult, they are necessary in the changing airline industry,
where low costs and low fares are proving to be the most
successful business formula. "Our employees continue to do an
outstanding job for this airline and for our customers," said Mr.
Lakefield. "We have spent a tremendous amount of time on this
Transformation Plan because we want our loyal and dedicated
employees to continue to have a company and a career at US
Airways. The alternative is to have these jobs exported to a new
generation of low-cost airlines, where any employees hired would
start at entry-level wages and without seniority," said Mr.
Lakefield.

The Company's Transformation Plan is built on several aspects of
proven success in the airline industry, beyond the necessary lower
labor costs. Those include:

   -- Lower, simplified pricing and lower distribution costs.  US
      Airways has already taken steps to simplify its fares by
      introducing its GoFares pricing plan in many markets served
      from Philadelphia, Washington, D.C., and Fort Lauderdale,
      and has stated its intent to expand that pricing plan across
      its system in conjunction with achieving lower costs.  A
      redesigned Web site and more airport technology will also
      lower distribution costs, enhance customer service and
      improve airport processing.

   -- Enhanced low-cost product offering.  US Airways customers
      will continue to benefit from many product offerings that
      are unique among low-cost carriers, including two-class
      service, international flights to Europe, the Caribbean,
      Latin America and Canada, service to airports that business
      travelers prefer, access to a global network via the Star
      Alliance, a premium frequent flyer program and competitive
      onboard service.

   -- Network enhancements.  Leveraging its strong positions in
      the major markets of Boston, New York, Philadelphia and
      Washington, D.C., US Airways intends to use its airport slot
      and facilities assets to offer nonstop service to more major
      business and leisure destinations.

   -- Lower operating costs.  In conjunction with more point-to-
      point flying, the airline will fly its fleet more hours per
      day as it decreases the time aircraft sit on the ground at
      hubs, waiting for connecting passengers.

US Airways is the nation's seventh-largest airline, serving nearly
200 communities in the U.S., Canada, Europe, the Caribbean and
Latin America. US Airways, US Airways Shuttle and the US Airways
Express partner carriers operate over 3,300 flights per day. For
more information on US Airways flight schedules and fares, contact
US Airways online at usairways.com, or call US Airways
Reservations at 1-800-428-4322.

As part of the Company's timetable to emerge from Chapter 11
reorganization, US Airways intends to file its disclosure
statement and plan of reorganization by the end of this year.

There has been no determination as to whether the Company's
existing equity securities will be preserved in any such plan of
reorganization, and there can be no assurance at this time as to
what values, if any, will be ascribed to the Company's existing
common stock and/or other equity securities. Accordingly, the
Company urges that the appropriate caution be exercised with
respect to existing and future investments in any of these
securities. Investors and other interested parties can monitor the
progress of the reorganization via the Internet at
http://www.transformingusairways.comIn addition, the investor
relations section of the Company's web site can be accessed under
the "about US Airways" section of http://www.usairways.com

         RSA Chief Executive Comments on Chapter 11 Filing

Dr. David G. Bronner, chief executive of the Retirement Systems of
Alabama (RSA), said that the decision by the US Airways Board of
Directors to file for Chapter 11 protection was a "difficult but
necessary decision."

Dr. Bronner serves as non-executive chairman of the US Airways
Board of Directors, and RSA holds a 36.2 percent stake in US
Airways, as the result of its $240 million equity investment in
the company when it emerged from a previous Chapter 11
reorganization in 2003. Dr. Bronner will continue to serve as
chairman of the board during the judicial restructuring.

"I remain convinced that a restructured US Airways with
competitive costs and its route network focused on the eastern
half of the U.S. and the Caribbean is an attractive investment,"
said Dr. Bronner. "Unfortunately, the airline industry changed
dramatically at about the same time as RSA made its investment.
While the airline has done a lot of things right since it emerged
from Chapter 11 last year, the business plan that we thought would
succeed proved to be insufficient as low-cost carriers have turned
the industry on its head over the past year."

Dr. Bronner said it has been terribly frustrating as US Airways'
chairman to watch as management and labor have been unable to
resolve their differences and reach new labor agreements. "I
believe that the labor representatives sitting on the Board of
Directors clearly understand the challenges the company faces, and
I know with certainty that the management team is doing everything
it can. I have tremendous empathy for US Airways employees who are
dealing with the changes in the industry, but the reality is that
US Airways must transform into a low-cost carrier. And to be a
low-cost carrier means the airline has to have low costs, and that
includes labor costs," said Dr. Bronner.

"The reluctance of union negotiators to agree to concessions is
understandable, but their refusal to acknowledge the realities of
the airline industry is a mystery. There are thousands of jobs at
stake, but if any of them are going to be saved, then all
employees are going to have to make sacrifices, as difficult as
that might be," added Dr. Bronner. "There is only one way for the
company to emerge from Chapter 11, and that involves lower costs,
including lower labor costs."

It is uncertain whether RSA will recover any or all of its
investment in US Airways, but Dr. Bronner said that the $240
million investment represents less than one percent of RSA's total
portfolio. "The public service employees and retirees have been
well served by our overall investment strategies over the years,
and our track record has resulted in changing a 25 percent funded
system with $500 million in assets to a 91 percent funded system
with $25 billion in assets, which means a safe and secure pension
for RSA members," said Dr. Bronner. "RSA has been an active
investor in the aviation business for over 25 years, and that has
benefited the state in numerous ways, including our public pension
funds. It is a tough business, but there are ways to make money in
the airline industry. It is obvious, however, that low costs are
the name of the game."

RSA said that further media inquiries about the US Airways
restructuring should be directed to US Airways Corporate Affairs
at 703-872-5100.

      Court Okays Bridge Orders to Assure Routine Operations

The U.S. Bankruptcy Court entered a series of "bridge" orders on
Sunday evening, which will assure routine operations while the
Court hears the Company's first day motions today, Sept. 13, 2004.

Under the interim relief granted by the Court, US Airways received
permission to, among other things:

     * Pay employee wages and continue benefits, such as medical
       and dental insurance.

     * Honor pre-petition obligations to customers and continue
       customer programs including US Airways' Dividend Miles
       program.

     * Pay for fuel under existing fuel supply contracts, and
       honor existing fuel supply, distribution and storage
       agreements.

     * Assume contracts relating to interline agreements with
       other airlines.

     * Pay pre-petition obligations to foreign vendors, foreign
       service providers and foreign governments.

     * Continue maintenance of existing bank accounts and existing
       cash management systems.

The Company filed its Chapter 11 petitions in the U.S. Bankruptcy
Court for the Eastern District of Virginia in Alexandria. The
Honorable Stephen Mitchell has been assigned to the case. A
hearing on the Company's first day motions has been scheduled
before Judge Mitchell at 10:30 a.m. today, Sept. 13 in Courtroom
#1 at the Martin V. B. Bostetter, Jr. United States Courthouse in
Alexandria. The case number is 04-13819.

"We are very pleased that the Court has granted this important
relief with respect to our employees, customers and vendors, which
ensures the seamless launch of our restructuring under Chapter
11," said Bruce Lakefield, US Airways president and chief
executive officer. "We look forward to the Court's timely
consideration of our full slate of first-day orders at tomorrow's
hearing."

Mr. Lakefield said customers should notice no changes to flight
operations or customer service programs because of the filing. All
bookings will be honored, and ticketing policies are unchanged.
Existing marketing partnerships with other airlines remain in
place. Vendors will be paid in ordinary course for provided goods
and services going forward. In the future, if there are any
changes to schedules or policies, they will be announced in
advance.

Headquartered in Arlington, Virginia, US Airways' primary business
activity is the ownership of the common stock of US Airways, Inc.,
Allegheny Airlines, Inc., Piedmont Airlines, Inc., PSA Airlines,
Inc., MidAtlantic Airways, Inc., US Airways Leasing and Sales,
Inc., Material Services Company, Inc. and Airways Assurance
Limited, LLC. Under a chapter 11 plan declared effective on March
31, 2003, USAir emerged from bankruptcy with the Retirement
Systems of Alabama taking a 40% equity stake in the deleveraged
carrier in exchange for $240 million infusion of new capital. US
Airways and its subsidiaries filed another chapter 11 petition on
September 12, 2004 (Bankr. E.D. Va. Case No. 04-13820).  Brian P.
Leitch, Esq., Daniel M. Lewis, Esq., and Michael J. Canning, Esq.
at Arnold & Porter LLP, and Lawrence E. Rifken, Esq. and Douglas
M. Foley, Esq. at McGuireWoods LLP represent the Debtors in its
restructuring efforts. In the Company's second bankruptcy filing,
it lists $8,805,972,000 in total assets and $8,702,437,000 in
total debts.


US AIRWAYS GROUP: Case Summary & 95 Largest Unsecured Creditors
---------------------------------------------------------------
Lead Debtor: US Airways Group, Inc.
             2345 Crystal Drive
             Arlington, Virginia 22227

Bankruptcy Case No.: 04-13820

Debtor affiliates filing separate chapter 11 petitions:

      Entity                                     Case No.
      ------                                     --------
      US Airways, Inc.                           04-13819
      PSA Airlines, Inc.                         04-13821
      Piedmont Airlines, Inc.                    04-13822
      Material Services Company, Inc.            04-13823

Type of Business: The Debtor operates a major network air carrier
                  through its ownership of the common stock of US
                  Airways, Inc., PSA Airlines, Inc., Piedmont
                  Airlines, Inc., Material Services Company, Inc.,
                  and Airways Assurance Limited.
                  See http://www.usairways.com/

Chapter 11 Petition Date: September 12, 2004

Court: Eastern District of Virginia (Alexandria)

Judge: Stephen S. Mitchell

Debtors' Counsels: Lawrence E. Rifken, Esq.
                   Douglas M. Foley, Esq.
                   Daniel F. Blanks, Esq.
                   John H. Maddock III, Esq.
                   Joseph S. Sheerin, Esq.
                   McGuireWoods LLP
                   1750 Tysons Boulevard, Suite 1800
                   McLean, VA 22102-3915
                   Tel: 703-712-5000
                   Fax: 703-712-5250

                           - and -

                   Brian P. Leitch, Esq.
                   Daniel M. Lewis, Esq.
                   Michael J. Canning, Esq.
                   Arnold & Porter LLP
                   370 Seventeenth Street, Suite 4500
                   Denver, CO 80202
                   Tel: 303-863-1000

                           - and -

                   555 Twelfth Street, NW
                   Washington, DC 20004
                   Tel: 202-942-5000

                           - and -

                   399 Park Avenue
                   New York, NY 10022
                   Tel: 212-715-1000

                                   Total Assets      Total Debts
                                   ------------      -----------
US Airways Group, Inc.           $8,805,972,000   $8,702,437,000
US Airways, Inc.                 $8,606,323,000   $8,600,458,000
PSA Airlines, Inc.               $10 M to $50 M   $10 M to $50 M
Piedmont Airlines, Inc.        More than $100 M  $50 M to $100 M
Material Services Company,       $10 M to $50 M   $10 M to $50 M
Inc.

A. US Airways Group, Inc.'s 5 Largest Unsecured Creditors:

   Entity                     Nature Of Claim       Claim Amount
   ------                     ---------------       ------------
Embraer - Empresa             Future Aircraft     $1,465,218,623
Brasileira De Aeronautica SA  Commitments
12 227-901 Sao Jose Dos
Campos - SP Brazil

Bombardier Inc. Bombardier    Future Aircraft       $947,998,195
Aerospace Regional Aircraft   Commitments
123 Garratt Boulevard
Downsview, Ontario
Canada M3K 1Y5

AVSA, S.A.R.L.                Future Aircraft        $88,000,000
2, Rond-Point Maurice         Commitments
Bellonti
31700 Blagnac, France

General Electric Company,     Future Aircraft        $57,083,950
acting through its Aircraft   Commitments
Engines Divisions (2)
One Neumann Way - F17
Cincinnati, OH 45215-1988

United Technologies           Accounts Payable        $1,211,353
Corporation
Pratt & Whitney Division
400 Main Street
E. Hartford, CT 06108

B. US Airways, Inc.'s 30 Largest Unsecured Creditors:

   Entity                     Nature Of Claim       Claim Amount
   ------                     ---------------       ------------
GE Capital Corporation (2)    Debt                  $149,754,160
C/O GE Capital Aviation
Services
201 High Ridge Road
Stanford, CT 06927

GE Engine Services, Inc. (2)  Debt and Accounts     $129,448,218
1 Neumann Way                 Payable
MD F112
Cincinnati, OH 45215

Electronic Data               Accounts Payable       $16,411,439
Systems Corporation
5400 Legacy Drive
H1-3F-43
Plano, TX 75024

Sabre, Inc.                   Accounts Payable        $6,539,579
3150 Sabre Drive, MD 8311
Southlake, TX 76092

Worldspan                     Accounts Payable
Airline Sales and Marketing   $4,111,644
300 Galleria Parkway,
NW Suite 400
Atlanta, GA 30339

Philadelphia International    Accounts Payable        $4,061,362
Airport
Terminal E
Philadelphia, PA 19153

Amadeus USA                   Accounts Payable        $3,306,715
9250 NW 36th Street Ac53
Miami, FL 33178

Rolls Royce, Inc.             Accounts Payable        $2,994,369
P. O. Box 31
Derby, DE24 8BJ
United Kingdom

Charlotte Douglas             Accounts Payable        $2,832,686
International Airport
P.O. Box 19066
Charlotte, NC 28219

Galileo - Cedant Corporation  Accounts Payable        $2,686,783
9700 West Higgins Road
Rosemont, IL 60018

LSG Skychefs                  Accounts Payable        $2,616,713
P.O. Box 7247-6009
Philadelphia, PA 19170-6009

Transportation Security       Accounts Payable        $2,224,081
Administration
614 Frelinghuysen Avenue
Newark, NJ 07114

Eurocontrol (Belgium)         Accounts Payable        $1,726,315
Rue de la Fusee 96
Bruxelles B1130
Belgium

The Port Authority of         Accounts Payable        $1,542,333
NY & NJ
LaGuardia Airport
Flushing, NY 11371

American Express              Accounts Payable        $1,300,000
3 World Financial Center
200 Vessey Street
Maildrop 01-42-04
New York, NY 10285

Allegheny County              Accounts Payable        $1,143,644
Airport
County of Allegheny
Pittsburgh International
Airport Landslide Terminal
Suite 4000
P.O. Box 12370
Pittsburgh, PA 15231

Massachusetts Port            Accounts Payable          $972,685
Authority
P.O. Box 5853
Boston, MA 02206

Gate Gourmet                  Accounts Payable          $867,321
Amsterdam BV
P.O. Box 7528
Schiphol East 0 1117 ZG
Netherlands

The Boeing Company,           Accounts Payable          $828,706
Commercial Aircraft
Division
P. O. Box 3707 MS 6X UI
Seattle, WA 98124

Primeflight Aviation          Accounts Payable          $826,922
Services, Inc.
7135 Charlotte Park
Nashville, TN 37209

Navitaire Inc.                Accounts Payable          $797,874
901 Marquette Ave
Suite 600
Minneapolis, MN 55402-3210

NAAS                          Accounts Payable          $796,000
111 W. Sunrise Hwy
Freeport, NY 11520

McCann Relationship           Accounts Payable          $700,000
(MRM)
622 Third Avenue
New York, NY 10017

Metropolitan                  Accounts Payable          $695,748
Washington Airports
Authority
Washington National Airport
Washington, DC 20001

Air General                   Accounts Payable          $600,000
One Intercontinental Way
Peabody, MA 01968

Huntleigh USA Corporation     Accounts Payable          $524,239
1704 Paysphere Circle
Chicago, IL 60674

Fleet Business Credit         Administrative Claim      $487,000
As agent for Loan             From Previous
Participants                  Bankruptcy Case
c/o Vedder Price Kaufman
222 N. Lasalle St, Ste. 2600
Chicago, IL 60601-1003

Coca Cola USA                 Accounts Payable          $363,050
P.O. Box 75890
Charlotte, NC 28275

Honeywell International Inc.  Accounts Payable          $326,697
101 Columbia Road
Morristown, NJ 07962

Hamilton Sundstrand           Accounts Payable          $318,023
Headquarter
One Hamilton Road
Windsor Lock, CT 06096-1010

C. PSA Airlines, Inc.'s 20 Largest Unsecured Creditors:

   Entity                     Nature Of Claim       Claim Amount
   ------                     ---------------       ------------
Anthem Blue Cross             Accounts Payable          $215,134
Blue Shield

Standard Aero                 Accounts Payable          $175,056

GE Engine Services            Accounts Payable          $172,516
Distribution, LLC (2)

Giliberti, Inc.               Accounts Payable           $75,075

Composite Specialties, Inc.   Accounts Payable           $65,888

AAR Aircraft Component        Accounts Payable           $58,729
Services

Aviall, Inc.                  Accounts Payable           $54,642

Tri-Cities Airport            Accounts Payable           $52,167
Commission

Thales Avionics, Inc.         Accounts Payable           $42,421

Metropolitan Knoxville        Accounts Payable           $39,797
Airport-Authority

Holiday Inn                   Accounts Payable           $39,037

Dayton Airport Hotel          Accounts Payable           $32,969

Castle Aviation, Inc.         Accounts Payable           $29,930

Gearbuck Aviation Services    Accounts Payable           $29,461

Anthony Business Forms        Accounts Payable           $28,845

Four Points Barcelo           Accounts Payable           $28,394
Hotel Pittsburgh

Ramada Hotel Airport -        Accounts Payable           $22,563
Montreal

Avcraft Aerospace GmbH        Accounts Payable           $22,430

Jeppesen Sanderson, Inc.      Accounts Payable           $22,044

Honeywell - NJ                Accounts Payable           $20,353

D. Piedmont Airlines, Inc.'s 20 Largest Unsecured Creditors:

   Entity                     Nature Of Claim       Claim Amount
   ------                     ---------------       ------------
Pratt & Whitney Canada, Inc.  Accounts Payable        $1,183,899
1000 Marie-Victorin
Longueuil, Quebec J4G1A1
Canada

Bombadier Aeorspace,          Accounts Payable          $511,733
Canadair Ops Center
Accts Payable Dept 620
P.O. Box 6087
Station Centre-Ville
Montreal, Quebec H3C3G9
Canada

Bombadier Services Corp       Accounts Payable          $450,083
3959 Collections Center Drive
Chicago, Illinois 60693

Bombadier Aerospace -         Accounts Payable          $125,156
West Virginia Air Center

WASP, Inc.                    Accounts Payable          $119,651

Honeywell International, Inc.                            $67,399

Piedmont Aviation             Accounts Payable           $60,206
Component Services

PPG Industries, Inc.          Accounts Payable           $57,745

Cognisa Security, Inc.        Accounts Payable           $51,641

Honeywell Inc.                Accounts Payable           $50,406

Treasurer Monroe County       Accounts Payable           $48,141
Airport Authority

Honeywell International       Accounts Payable           $42,625

Bortek Industries, Inc.       Accounts Payable           $39,470

Alleghany County              Accounts Payable           $37,394
Airport Authority

Aviall                        Accounts Payable           $34,377

Ikon Office Solutions         Accounts Payable           $32,851

City of Syracuse,             Accounts Payable           $32,495
Department of Aviation

Express Catering Inc.         Accounts Payable           $31,422

Roanoke Regional              Accounts Payable           $30,924
Airport Commission

Inair Aviation Services       Accounts Payable           $29,065

E. Material Services Company's 20 Largest Unsecured Creditors:

   Entity                     Nature Of Claim       Claim Amount
   ------                     ---------------       ------------
Stevens Aviation, Inc.        Accounts Payable           $23,099

FBO Avcenter                  Accounts Payable           $21,893

Jacksonville Flying           Accounts Payable           $20,088
Services, Inc.

Phoenix Metal Products Inc.   Accounts Payable           $18,672

Asheville Jet Center          Accounts Payable           $17,130

Penn State University         Accounts Payable           $12,501

Tac Air                       Accounts Payable           $12,349

First Air                     Accounts Payable            $8,721

Irving Oil Terminals          Accounts Payable            $8,509

Air Wilmington, Inc.          Accounts Payable            $8,049

White Crown Aviation          Accounts Payable            $7,578

FBO Avecenter                 Accounts Payable            $7,492

Montgomery Aviation           Accounts Payable            $7,293

Sowell Aviation Co., Inc.     Accounts Payable            $5,509

Mercury Air Center            Accounts Payable            $5,060

Carolina Air Center           Accounts Payable            $4,701

Pitt-Greenville Airport       Accounts Payable            $4,161
Authority

Maine Instrument Flight Inc.  Accounts Payable            $3,858

Tri-City Aviation, Inc.       Accounts Payable            $3,810

Raytheon Aircraft             Accounts Payable            $3,024
Services, Inc.


U.S. CANADIAN: Purchases 1.66% More Interest in CMKM Diamonds
-------------------------------------------------------------
U.S. Canadian Minerals Inc. (OTCBB: UCAD) has exercised a portion
of its option with CMKM Diamonds Inc. (Pink Sheets: CMKX) to
purchase an additional 1.66% interest in all of CMKX's mineral
claims for $2,500,000. Under the agreement reached in July, UCAD
has a one-year option agreement to purchase up to an aggregate
total of 10% interest in all of the mineral claims held by CMKX
for a total of $15 million payable to CMKM Diamonds Inc. With the
exercise of this portion of the option and previous option
exercises and transactions with CMKX, UCAD currently holds 9.16%
of all of CMKX's mineral claims. Should UCAD exercise its
remaining portion of its option, the company will hold 15% of all
of the CMKX mineral claims.

Rendal Williams, CEO of UCAD, stated, "The company expects to
exercise additional percentages under the option as we move
forward, increasing our holdings and asset base with the
acquisition of potentially high revenue properties."

                           About UCAD

U.S. Canadian Minerals is a multi-dimensional, mineral-based
corporation headquartered in Las Vegas, Nevada.  On its own and
through Joint Ventures, U.S. Canadian Minerals is looking to
expand and develop mining properties throughout the world.  U.S.
Canadian Minerals has already begun work on several projects, all
of which are in various stages of development.

                          *     *     *

As reported in the Troubled Company Reporter on July 30, 2004, the
Board of Directors of U.S. Canadian Minerals, Inc., dismissed
Beckstead and Watts, LLP, as its independent public accountants on
June 11, 2004.  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.


U.S. CANADIAN: Gets $3 Million of Funding Via Private Placement
---------------------------------------------------------------
U.S. Canadian Minerals Inc. (OTCBB: UCAD) has received $3,000,000
of funding by means of a private placement.

Rendal Williams, CEO of UCAD, stated, "This funding will allow the
company to move forward on several fronts in the execution of its
current plans and future development of the company's financial
growth as dictated by the board of directors."

A U.S. Canadian Minerals Inc. executive team, with other strategic
partners, will arrive in South America this week to explore the
development of several key acquisition possibilities that have
been targeted on previous trips. Williams further stated, "Many of
the due diligence packages are nearing completion, revealing
incredible potential results, which demands an additional research
trip to conclude the feasibility of Level 1 priority for expanded
operations inside South America."

As reported in the Troubled Company Reporter on Sept. 2, members
of the Company's management team have recently returned from
Ecuador, where several of its operational employees are working
diligently to increase the efficiency of the current operation.
During this trip, management met with local attorneys to resolve
all outstanding regulatory and tax matters and bring the
facility's reporting system up to UCAD approved standards. In
addition, management reached an agreement with Nevada Minerals'
Ecuadorian subsidiary for joint operations in the Yellow River
region.

Rendal Williams, UCAD's CEO, stated, "We are extremely excited to
have confirmation that all governmental and regulatory issues have
been resolved and that the company is in good standing." Mr.
Williams continued, "I am confident in the expertise of our joint
operational partner here in Ecuador." Alejandro Diaz Silvia,
geologist and operations manager for Nevada Minerals' Ecuadorian
subsidiary, commented, "This further enhances the company's
ability to increase its extraction and processing of gold ore from
the Yellow River mine."

                           About UCAD

U.S. Canadian Minerals is a multi-dimensional, mineral-based
corporation headquartered in Las Vegas, Nevada.  On its own and
through Joint Ventures, U.S. Canadian Minerals is looking to
expand and develop mining properties throughout the world.  U.S.
Canadian Minerals has already begun work on several projects, all
of which are in various stages of development.

                          *     *     *

As reported in the Troubled Company Reporter on July 30, 2004, the
Board of Directors of U.S. Canadian Minerals, Inc., dismissed
Beckstead and Watts, LLP, as its independent public accountants on
June 11, 2004.  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.


VENTAS INC: Appoints Christopher T. Hannon to Board of Directors
----------------------------------------------------------------
Ventas, Inc. (NYSE: VTR) has appointed Christopher T. Hannon,
senior vice president and chief financial officer of Province
Healthcare Company (NYSE: PRV), to its Board of Directors,
effective immediately.

"As a senior executive with one of the nation's largest non-urban
hospital companies, Chris brings to our Board deep experience and
credibility in the hospital sector and in healthcare finance,"
Ventas Chairman, CEO and President Debra A. Cafaro said. "He will
be an important asset to Ventas, particularly as we continue our
growth and diversification efforts.

"With the appointment of Chris, six of our seven Board members are
independent Directors. This underscores our commitment to best
practices in corporate governance, which we believe is an
important component for building shareholder value," Ms. Cafaro
added.

Since 2002, Mr. Hannon, who is 42, has been senior vice president
and chief financial officer of Province, which he joined in 1997.
(Province has recently announced that it has agreed to be acquired
by LifePoint Hospitals, Inc. (Nasdaq: LPNT).) Prior to 1997, Mr.
Hannon was a vice president with SunTrust Banks, Inc. where he was
a senior healthcare lender.

Mr. Hannon will serve on the Company's Audit and Compliance
Committee. He will replace Jay M. Gellert, who will continue to
chair Ventas's Executive Committee and sit on its Nominating and
Governance Committee.

Ventas was assisted in its search by Heidrick & Struggles.

Ventas, Inc. is a leading healthcare real estate investment trust
that owns healthcare and senior housing assets in 39 states. Its
properties include hospitals, nursing facilities and assisted and
independent living facilities. More information about Ventas can
be found on its website at http://www.ventasreit.com

                         *     *     *

As reported in the Troubled Company Reporter on June 30, 2004,
Standard & Poor's Ratings Services raised its corporate credit
ratings on Ventas Inc., its operating partnership Ventas Realty
L.P., and Ventas Capital Corp. to 'BB' from 'BB-'. In addition,
ratings are raised on the company's senior unsecured debt, which
totals $366 million. Concurrently, the outlook is revised to
stable from positive.

"The upgrades acknowledge the company's steady improvement in both
its business and financial profiles," said Standard & Poor's
credit analyst George Skoufis. "Recent acquisitions have targeted
improving Ventas' diversification, foremost its concentration with
its primary tenant Kindred Healthcare Inc. Growing cash flow and
profits, and lower leverage have contributed to stronger debt
protection measures. Credit weaknesses remain, however, including
Ventas' continued reliance on un-rated Kindred, the risk of future
changes to government reimbursement, and constrained, but
improved, financial flexibility."


VENTAS INC: Closes New $300 Million Secured Credit Facility
-----------------------------------------------------------
Ventas Realty, Limited Partnership, a subsidiary of Ventas, Inc.
(NYSE: VTR), closed its new $300 million secured revolving credit
facility initially priced at 125 basis points over LIBOR. The new
credit facility replaces the Company's previous revolving credit
facility and term loan that were priced at 250 basis points over
LIBOR.

"The significant improvement in the pricing of our credit facility
reflects upgrades in our credit ratings and the success of our
diversification program, increased cash flows and profits, and
lower leverage. We are delighted that these accomplishments are
being recognized through this extremely attractive credit
facility," Ventas Chairman, President and CEO Debra A. Cafaro
said. "With a lower cost of capital, we can continue to execute
our business strategy of diversifying our asset base and revenue
sources within the healthcare and senior housing sector."

The Company's new credit facility matures in three years and gives
the Company a one-year extension option to September 2008. It
includes a $150 million "accordion feature" that permits the
Company to expand its borrowing capacity to a total of $450
million. The Company's LIBOR margin under the credit agreement
will adjust as the Company's leverage changes. Finally, the
Company reduced the number of properties pledged as collateral
under its new credit facility.

Ventas said the initial amount drawn under the new credit facility
was $149 million and the proceeds were used to repay all
outstanding indebtedness under the Company's existing credit
agreement. It expects to record an expense of $1.4 million in the
third quarter representing the write-off of unamortized deferred
financing fees related to its prior credit facility, which expense
is excluded from the Company's previously announced 2004
normalized FFO guidance.

Banc of America Securities, LLC was the sole lead arranger for the
credit facility. Bank of America, N.A., Merrill Lynch & Co.,
Merrill Lynch Pierce Fenner & Smith Incorporated, UBS Securities
LLC, Calyon New York Branch, JPMorgan Chase Bank and Citicorp
North America, Inc. participated in the facility in various agent
capacities.

            Ventas Declares Regular Quarterly Dividend

Ventas' Board of Directors declared a regular quarterly dividend
of $0.325 per share, payable in cash on September 30, 2004, to
stockholders of record on September 20, 2004. The dividend is the
third quarterly installment of the Company's 2004 annual dividend.
The Company has approximately 84.2 million shares of common stock
outstanding.

Ventas, Inc. is a leading healthcare real estate investment trust
that owns healthcare and senior housing assets in 39 states. Its
properties include hospitals, nursing facilities and assisted and
independent living facilities. More information about Ventas can
be found on its website at http://www.ventasreit.com

                         *     *     *

As reported in the Troubled Company Reporter on June 30, 2004,
Standard & Poor's Ratings Services raised its corporate credit
ratings on Ventas Inc., its operating partnership Ventas Realty
L.P., and Ventas Capital Corp. to 'BB' from 'BB-'. In addition,
ratings are raised on the company's senior unsecured debt, which
totals $366 million. Concurrently, the outlook is revised to
stable from positive.

"The upgrades acknowledge the company's steady improvement in both
its business and financial profiles," said Standard & Poor's
credit analyst George Skoufis. "Recent acquisitions have targeted
improving Ventas' diversification, foremost its concentration with
its primary tenant Kindred Healthcare Inc. Growing cash flow and
profits, and lower leverage have contributed to stronger debt
protection measures. Credit weaknesses remain, however, including
Ventas' continued reliance on un-rated Kindred, the risk of future
changes to government reimbursement, and constrained, but
improved, financial flexibility."


VISTEON CORP: Moody's Reviewing Low-B Ratings & May Downgrade
-------------------------------------------------------------
Moody's Investors Service has placed the long-term debt ratings of
Visteon Corporation under review for possible downgrade, and
lowered the company's speculative grade liquidity rating to SGL-2
(good liquidity) from SGL-1 (very good liquidity).

The rating actions are prompted by the prospects for further
shortfalls in the company's operating performance due to slowing
auto production rates, and by Visteon's announcement that it will
write-down its deferred tax asset of between $825 mm and $900 mm,
and withdraw its previous guidance on 2004 earnings and cash flow.
Although the company continues with substantial liquidity of
$1 billion in cash and marketable securities at June 30, 2004 and
had un-drawn bank facilities of $1.3 billion, Moody's is concerned
about the weaker outlook for Visteon's free cash flow and the
resultant coverage levels for debt and related fixed costs.  The
lowered SGL rating considers the weaker prospects for internally
generated funds and the potential for reducing headroom under
Visteon's financial covenants depending upon the extent to which
EBITDA declines over the next several quarters.

Ratings under review for possible downgrade include:

   * Visteon Corporation

         -- Senior Implied, Ba1,
         -- Senior Unsecured, Ba1,
         -- Issuer ratings, Ba1,
         -- Shelf registration for:

            (a) senior unsecured, (P)Ba1,
            (b) subordinated, (P)Ba2, and
            (c) preferred, (P)Ba3.

   * Visteon Capital Trust I

         -- Shelf registration for guaranteed trust preferred
            securities at (P)Ba2.

Ratings lowered are:

   * Visteon Corporation

         -- Speculative Grade Liquidity Rating to SGL-2 from
            SGL-1.

The company's Not Prime rating for commercial paper is unaffected.

The write-down of the deferred tax asset represents a non-cash
charge.  It results from historical losses in 2002 and 2003 and
the likely consequences of lower than expected North American
production in 2004.  Combined with the withdrawal of previous
guidance on 2004 earnings and cash flow resulting from lower
automotive production and raw material cost increases, it is
doubtful that Visteon will have meaningful positive free cash flow
in 2004.  The deferred tax write-down will lower Visteon's book
net worth, which was $1.83 billion at June 30, 2004 to
$1.0 billion or under on a pro forma basis.  Debt to
capitalization will similarly increase from 51% to roughly 66% on
a pro forma basis at June 30, 2004.

Visteon's previous SGL rating had anticipated that the company
would report significant free cash flow in 2004.  However, with
the removal of earnings and cash flow guidance the company's
ability to internally fund its investment requirements has been
diminished.  The company continues to hold significant cash
balances and remains compliant with its bank financial covenant of
a maximum ratio of net debt/EBITDA of 3.5 to 1.  Nevertheless,
with reduced earnings guidance the lower SGL rating considers the
potential for the degree of headroom under this covenant to weaken
over time.  The company renewed in June its 364-day bank credit
facility for $565 million and continues with a longer-term
revolver currently set to mature in June 2007.

Ford represents approximately 71 % of Visteon's revenues with much
of this based in North America.  While the company has made
progress in reducing its dependence on Ford over the last few
years, Ford continues as the principal driver of Visteon's
revenues and earnings.

The review will focus on the potential implication to Visteon's
business of lower North American automotive production rates and
the company's ability to adapt to a more challenging business
environment.  Moody's will consider the resultant level of future
earnings, free cash flow and the degree to which debt protection
ratios may be weakened, and the extent and outcome of any Ford and
Visteon discussions.

Visteon Corporation is a leading full-service supplier that
delivers consumer-driven technology solutions to automotive
manufacturers worldwide and through multiple channels within the
global automotive aftermarket.  Visteon has approximately 72,000
employees and a global delivery system of more than 200 technical,
manufacturing, sales and service facilities located in 25
countries.


W.R. GRACE: Objects to Massachusetts Environmental Claims
---------------------------------------------------------
David W. Carickhoff, Jr., Esq., at Pachulski, Stang, Ziehl,
Young, Jones & Weintraub, P.C., in Wilmington, Delaware, informs
the U.S. Bankruptcy Court for the District of Delaware that on
March 31, 2003, the Massachusetts Department of Environmental
Protection filed proofs of claim against:

    (a) W.R. Grace & Co. -- Claim No. 12848

    (b) W.R. Grace & Co.-Conn. -- Claim No. 12849

    (c) Grace Energy Corporation -- Claim No. 13487

The MADEP Claims seek recovery for oversight, contractor, and
future-remediation costs that are allegedly owed by the Debtors to
the MADEP in connection with eight sites within the Commonwealth
of Massachusetts:

    * Former Zonolite Plant Site

    * Daramic Plant Site

    * W.R. Grace Plant Superfund Site

    * Cambridge Plant Site

    * Woburn, MA, Source Area and Central Area

    * Blackburn & Union Privileges Site

    * Parcel 2322 Debris Area off Knox Trail Site

    * the MMR Pipeline Site

According to Mr. Carickhoff, the MADEP Claims are allegedly based
on federal and state laws, including:

    * the Comprehensive Environmental Response, Compensation, and
      Liability Act of 1980;

    * the Massachusetts Oil and Hazardous material Release
      Prevention and Response Act;

    * the Massachusetts Contingency Plan; and

    * the Timely Action Schedule and Fee Provisions.

The MADEP Claims assert $42,134,987 in unsecured claims, including
$799,419 for allegedly unreimbursed prepetition response costs and
fees.

                         General Objections

(A) Duplicative Claims

The Debtors ask Judge Fitzgerald to disallow Claim Nos. 12848 and
13487 because they are entirely duplicative of Claim No. 12849.
Claim No. 12848 asserts exactly the same liability as
Claim No. 12849, except that Claim No. 12848 is asserted against
W.R. Grace & Co., and Claim No. 12849 is asserted against W.R.
Grace & Co.- Conn.  Claim No. 13487 raises exactly the same claims
that are already asserted in Claim No. 12849, except that Claim
No. 13487 is asserted against Grace Energy Corporation.  The
Debtors believe that the amounts sought in these Claims are
properly asserted only against W.R. Grace & Co.-Conn., which is
the entity that controls the business of its parent, W.R. Grace &
Co., which is a holding company.

Furthermore, it is highly unlikely that the specific entity named
in each of the MADEP Claims will be relevant for purposes of any
potential distribution pursuant to the Debtors' anticipated
Chapter 11 Plan.  The Debtors anticipate that the Plan will
provide for the substantive consolidation of all of the Debtors.
Accordingly, all of the Debtors' collective assets will likely be
available to satisfy their collective liabilities.  The Debtors
anticipate filing their Plan no later than the Court's
October 14, 2004 deadline.  Given the likelihood that the Debtors'
estates will be substantially consolidated for purposes of their
Plan, the two claims should be disallowed.

(B) Alleged Priority

The Debtors object to each of the MADEP Claims to the extent that
they seek any sort of administrative or other priority under
Section 507 of the Bankruptcy Code.

Mr. Carickhoff points out that it is unclear whether the MADEP
believes it is entitled to administrative or other priority for
any of the amounts sought in the MADEP Claims.  The MADEP Claims
marked the "Unsecured Non-Priority Claims" box on the face of each
Proof of Claim Form.  The supporting documentation for each of the
MADEP Claims, however, states that, "The Commonwealth is entitled
to administrative expense priority, and may file an administrative
expense application at the appropriate time, for the cost of
postpetition response action costs it incurs in connection with
property of the estate, costs of complying with the Debtors'
injunctive obligations, postpetition Annual Compliance Assurance
Fees, and for any postpetition penalties.  The remainder of the
Commonwealth's claim is filed as a general unsecured claim."
Therefore, it is unclear what, if any, portion of the MADEP Claims
are being asserted as administrative or other priority claims.

Mr. Carickhoff asserts that the MADEP is not entitled to
administrative or other priority for any of the asserted amounts.
The MADEP has not provided any information or documentation that
would support the proposition that any portion of the MADEP Claims
constitute, "actual, necessary costs and expense of preserving the
estate, including wages, salaries, or commissions for services
rendered after the commencement of the case" as required for
administrative priority under Section 503(I)(A) of the Bankruptcy
Code.  Furthermore, the MADEP could not satisfy this burden
because all of the asserted claims relate to the Debtors'
prepetition conduct and, therefore, the asserted amounts arose
before the Petition Date and are prepetition claims.

                        Specific Objections

(1) Former Zonolite Plant Site

Claim No. 12849 asserts unsecured non-priority claims totaling
$195,456 for the Debtors' Former Zonolite Plant Site.  In
particular, the MADEP seeks:

      (i) $150,000 for future remediation costs;

     (ii) $1,300 for postpetition compliance assurance fees;

    (iii) $42,293 for prepetition oversight costs; and

     (iv) $1,863 for postpetition oversight costs.

The Debtors object to the asserted future remediation costs
because these costs are duplicative of claims that have been
asserted against their estates by the current owners of the
affected property.  The Debtors do not own the Former Zonolite
Site, and the current owner, Olden Limited Partnership, also filed
a claim for this site.  Therefore, the MADEP may never actually
expend funds to clean up this site, and, to the extent the MADEP
does not expend these funds, they may call on Olden Limited for
reimbursement.

The Debtors object to the asserted postpetition claims for annual
compliance and oversight costs.  These claims relate to
prepetition liabilities and are no more than prepetition, non-
priority, unsecured claims.

Therefore, with respect to the Former Zonolite Plant Site, the
Debtors ask the Court to reduce Claim No. 12849 by $151,300 and
allow an unsecured non-priority claim for $44,156.

(2) Daramic Plant Site

Claim No. 12849 asserts unsecured non-priority claims for the
Daramic Plant Site totaling $130,200.  In particular, the MADEP
seeks:

      (i) $125,000 for future remediation costs; and

     (ii) $5,200 for annual compliance assurance fees.

The Debtors object to the future remediation amounts because:

    -- the Debtors own the Daramic Plant Site;

    -- they are currently performing remediation at this site;

    -- they are subject to closure requirements under the
       Massachusetts Contingency Plan obligating them to
       complete this remedy; and

    -- they are committed to continuing their investigation and
       remediation at this site.

Therefore, it is highly unlikely that the MADEP will ever incur
these costs, and Claim No. 12849 should be reduced by $125,000
with respect to Daramic Plant Site.

The Debtors object to the asserted $3,900 in postpetition annual
compliance fees.  The Claim is related to prepetition liability
and is no more than a prepetition, non-priority unsecured claim.

Thus, with respect to the Daramic Plant Site, the Debtors ask the
Court to reduce Claim No. 12849 by $125,000 and allow an unsecured
non-priority claim for $5,200.

(3) W.R. Grace Plant Superfund Site

Claim No. 12849 asserts unsecured non-priority claims totaling
$25,741,003 for the W.R. Grace Plant Superfund Site in Atcom,
Massachusetts.  In particular, the MADEP seeks:

      (i) $25,000,000 for future remediation costs;

     (ii) $244,542 for prepetition contractor costs;

    (iii) $465,099 for prepetition oversight costs;

     (iv) $18,367 for postpetition contractor costs; and

      (v) $12,993 for postpetition oversight costs.

The Debtors object to the future remediation amounts because:

    -- they own the property where the release occurred;

    -- they are currently performing remediation at this site; and

    -- they are subject to a judicially approved consent decree
       with the Environmental Protection Agency and an
       administrative order issued by the MADEP, both of which
       require the Debtors to perform necessary response actions.

Therefore, it is remote and highly speculative that the MADEP will
ever incur these costs.  Claim No. 12849 should be reduced by
$25,000,000.

Mr. Carickhoff contends that the $244,543 sought for prepetition
contractor costs should also be disallowed.  Approximately
$208,000 of the claim relates to costs that were allegedly
incurred by the MADEP prior to 1998 and were resolved by the terms
of a 1997 Partial Consent Decree between the Debtors and the EPA,
which settled past response costs through December 31, 1997,
including state oversight costs.  In addition, to the extent the
MADEP seeks contractor oversight costs incurred between January 1,
1998 and the Petition Date, the Court should deny MADEP's claim
because the agency has not stated a basis for its right to the
recovery and has previously stated to the Debtors that the
contractor costs are not recoverable.  The MADEP has never sought
recovery for contractor costs, and, during multiple conversations
with the Debtors, the MADEP has repeatedly stated that it did not
intend to seek those costs.

The Court should also expunge $461,848 of the $465,099 claim that
the MADEP has asserted for prepetition oversight costs, which
includes:

    * $300,412 for master operable unit;

    * $163,318 for operable unit 01; and

    * $1,368 for operable unit 03.

The Debtors object to all but $3,251 of the amounts sought for the
master operable unit for three reasons:

    -- Almost all of the costs were incurred prior to 1998, and
       resolved pursuant to the 1997 Partial Consent Decree;

    -- The Debtors have already paid for the oversight costs
       incurred during 1998.  Specifically, the Debtors paid to
       EPA $29,491 for state oversight costs that were billed by
       EPA under the state oversight costs portion of the EPA
       oversight invoice for 1998; and

    -- The Debtors disputed the 1999 state oversight costs with
       the EPA, along with other costs, and posted an escrow for
       any prospective liability.  The EPA subsequently returned
       the escrowed amount to the Debtors.

The Debtors also object to the MADEP's prepetition claims for
operable unit 01 and operable unit 03 because the Debtors are not
liable for any of the amounts sought.  These alleged costs relate
to the period prior to 1998 and have been resolved pursuant to the
1997 Partial Consent Decree.

The Debtors object to the postpetition contractor costs because
the MADEP has not stated a basis for its right to the recovery and
has previously stated that the contractor costs are not
recoverable.

Therefore, with respect to the W.R. Grace Plant Superfund Site,
the Debtors ask the Court to reduce Claim No. 12849 by $25,724,758
and allow an unsecured non-priority claim for $16,244.

(4) Cambridge Plant Site

Claim No. 12849 asserts unsecured non-priority claims for the
Cambridge Plant Site.  In particular, the MADEP seeks:

      (i) an unspecified amount for future remediation costs; and

     (ii) $3,900 for annual compliance assurance fees.

The Debtors object to any future remediation amounts because they
own the Cambridge Plant Site, they are currently performing
remediation at this site, and they are committed to continuing
their investigation and remediation at this site.  Therefore, the
basis for the MADEP's claim for these costs is remote and highly
speculative.  Claim No. 12849 should be disallowed to the extent
it seeks any future remediation costs for the Cambridge Plant
Site.

Therefore, with respect to the Cambridge Plant Site, the Debtors
ask the Court to disallow any request for future remediation costs
and to allow an unsecured non-priority claim for $3,900 with
respect to Claim No. 12849.

(5) Woburn, MA, Source Area and Central Area

Claim No. 12849 asserts unsecured non-priority claims totaling
$12,023,788 for the Woburn Source Area and Central Area.  In
particular, the MADEP seeks:

      (i) $12,000,000 for future remediation costs;

     (ii) $17,337 for prepetition oversight costs; and

    (iii) $6,450 for postpetition oversight costs.

The Debtors believe that the MADEP Claims with respect to this
site should be reduced to $1,457.

The Debtors object to the future remediation amounts because they
own the Source Area property, they are currently performing
remediation at their Source Area property, and they are committed
to fulfilling their obligations under a consent decree with the
EPA for the Woburn site.  Therefore, the MADEP's claim for these
costs is remote and highly speculative.  Claim No. 12849 should be
reduced by $12,000,000.

The $17,337 in prepetition oversight costs includes:

    -- $16,553 for the Debtors' master operable unit; and

    -- $784 for the Debtors' operable unit 01.

The Debtors believe that the $16,553 in asserted prepetition
oversight costs for the master operable unit should be reduced to
$1,457.  The MADEP's figure includes $15,039 for costs that relate
to 1996, and these amounts have been paid previously.  In
particular, the Debtors paid the Source Area/Management of
Migration, Central Area, and Wells G&H non-allocable bills for the
MADEP's oversight through September 1996.  Similarly, the $784 in
prepetition oversight costs for operable unit 01 should be
eliminated because it also relates to the period before September
1996, and, therefore, has been covered by the previously paid
oversight bills.

The $6,450 in asserted postpetition oversight costs includes
$2,704 for the master operable unit and $3,746 for operable unit
03.  The Debtors are not liable to the MADEP for any of these
costs that allegedly relate to the master operable unit because
the costs are not validly associated with the Debtors' Source Area
property.  The Debtors also object to the asserted postpetition
oversight costs for operable unit 03 -- Aberjona River -- because
they have no legal liability for costs associated with the
Aberjona River Study.

Therefore, with respect to Woburn Source Area and Central Area,
the Debtors ask the Court to disallow all requests for future
remediation costs and postpetition oversight costs, and allow an
unsecured non-priority claim for prepetition oversight costs for
$1,457 with respect to Claim No. 12849.

(6) Blackburn & Union Privileges Site

Claim No. 12849 asserts unsecured non-priority claims totaling
$4,005,981 for the Blackburn & Union Privileges Site.  In
particular, the MADEP seeks $4,000,000 for future remediation
costs and $5,981 for oversight costs.

The Debtors object to the MADEP's claim for $4,000,000 in future
remediation costs because it is based on speculative and remote
improbabilities, not on costs that the MADEP realistically has any
potential to incur.  The Debtors do not own the Blackburn & Union
Privileges Site, which is a federal superfund site at which a
different private, potentially responsible entity, Tyco
Healthcare, is currently undertaking an investigation and remedial
action feasibility study.  In the event that either Tyco
Healthcare or the property-owner should fail to complete the
requisite remedial work, then the EPA -- not the MADEP -- would
ultimately be responsible for any necessary future remediation
costs.  Therefore, the MADEP's claim for future remediation costs
is unfounded and should be disallowed.

With respect to the Blackburn & Union Privileges Site, the Debtors
ask the Court to disallow all requests for future remediation
costs and to allow an unsecured non-priority claim for prepetition
oversight costs for $5,981 with respect to Claim No. 12849.

(7) Parcel 2322 Debris Area off Knox Trail Site
     (Concord Debris Area)

Claim No. 12849 asserts an unsecured non-priority claim for the
Knox Trail Site.  In particular, the MADEP seeks an unspecified
amount for future remediation costs and $1,950 for postpetition
annual compliance assurance fees.  The Debtors believe that the
MADEP Claims with respect to this site should be limited to
$1,950.

The Debtors object to any future remediation amounts because:

    -- they own the Concord Debris Area;

    -- they are currently performing remediation at this site; and

    -- they are subject to closure requirements under the
       Massachusetts Contingency Plan, which requires them to
       complete this remedy.

Therefore, it is very unlikely that the MADEP will ever incur
those costs.  Claim No. 12849 should be disallowed to the extent
it seeks any future remediation costs for the Concord Debris
Area.

The Debtors acknowledge the MADEP's claim for $1,950 in oversight
costs, and they agree that the Court may allow an unsecured non-
priority claim for $1,950 with respect to the oversight costs for
the Concord Debris Area that are asserted in Claim No. 12849.

(8) MMR Pipeline Site (Sandwich, MA)

Claim No. 12849 asserts an unsecured prepetition claim for the MMR
Pipeline Site.  In particular, the MADEP seeks:

      (i) an unspecified amount for future remediation costs and
          natural resource damages;

     (ii) $24,165 for prepetition oversight costs; and

    (iii) $8,543 for postpetition oversight costs.

The Debtors believe that they have no liability to the MADEP with
respect to this site.  Therefore, the Debtors ask the Court to
disallow all these amounts.

Mr. Carickhoff explains that the Debtors are not liable to the
MADEP for the MMR Pipeline Site because Samson Hydrocarbons is the
party that signed the Tier 1A permit for investigation and
remediation of the site and, therefore, the party from whom the
MADEP should seek recovery for the asserted amounts.  Furthermore,
the Debtors are presently involved in litigation over this site
with Kaneb Pipeline Operating Partnership.  A Texas District Court
recently held that KPOP owns the pipeline.  Therefore, the MADEP
can also seek recovery from KPOP, the site's current owner.  All
amounts sought in Claim No. 12849 with respect to the MMR Pipeline
Site should be expunged.

Headquartered in Columbia, Maryland, W.R. Grace & Co., --
http://www.grace.com/-- supplies catalysts and silica products,
especially construction chemicals and building materials, and
container products globally. The Debtors filed for chapter 11
protection on April 2, 2001 (Bankr. Del. Case No: 01-01139).
James H.M. Sprayregen, Esq., at Kirkland & Ellis and Laura Davis
Jones, Esq., at Pachulski, Stang, Ziehl et al. represent the
Debtors in their restructuring efforts. (W.R. Grace Bankruptcy
News, Issue No. 70; Bankruptcy Creditors' Service, Inc., 215/945-
7000)


WAVING LEAVES: Hires David Wilson as Accountants
------------------------------------------------
The Honorable Russ Kendig of the U.S. Bankruptcy Court for the
Northern District of Ohio, Eastern Division, approved the
employment of David J. Wilson & Associates, LLC, as Waving Leaves,
Inc., and its debtor-associates' accountants.

Richard W. Dyer, a partner at Wilson & Assoc. tells the Court that
the Firm did prepetition accounting work for the Debtors.  Mr.
Dyer adds that the Firm will waive any prepetition payment owed by
the Debtors.

The Debtors believe that Wilson is well qualified to deal
effectively with potential accounting issues and problems that may
arise in these cases.

Wilson professionals bill these hourly rates for their services:

        Designation          Rate
        -----------          ----
        Partners            $150 to $200
        Associates           $80 to $125
        Paraprofessionals    $50 to $65

To the best of the Debtors knowledge, Wilson & Associates is
disinterested as that term is defined in Section 101(14) of the
Bankruptcy Code.

Headquartered in Wooster, Ohio, Waving Leaves and its
debtor- affiliates, filed for chapter 11 protection on December 3,
2004 (Bankr. N.D. Ohio Case No. 03-66524).  Jeffrey W. Krueger,
Esq., and R. Timothy Coerdt, Esq., at Wegman, Hessler &
Vanderburg, represent the Debtors in their restructuring efforts.
When the Company filed for protection, it listed $6,806,785 in
total assets and $8,178,503 in liabilities.


WEST PENN: Plans to Transition Bellevue Hospital to AGH
-------------------------------------------------------
Officials of the West Penn Allegheny Health System reported plans
to transition Suburban General Hospital in Bellevue to a northern
campus of Allegheny General Hospital. The new entity, to be called
AGH Suburban Campus, will afford residents of Pittsburgh's
northern communities enhanced access to AGH's nationally
recognized acute care services.

According to Jerry Fedele, President and CEO of WPAHS, the merger
of AGH and SGH, is a development that will significantly benefit
the system, both hospitals, and most important, patients served by
the institutions.

"Clearly we believe that we can enhance our clinical capabilities
through a more synergistic integration of our respective
hospitals' strengths. For more than a century, Suburban General
and its staff have provided an outstanding level of care for the
people of Bellevue and its adjacent neighborhoods. We maintain,
however, that in addition to the current services provided, it has
even greater potential as a community resource and value to our
system as a center for select specialty services and post-acute
care programs. Restructuring the hospital as a campus of AGH will
better enable us to achieve that goal," said Jerry Fedele, WPAHS
President and Chief Executive Officer.

Suburban General is a 154-bed hospital offering a full spectrum of
medical and surgical services, including emergency, orthopedic,
rehabilitation, cardiac and intensive care. Other notable programs
include a recently opened neurological rehabilitation unit, a
sleep disorders center and an institute for pain medicine. Each
year, more than 13,000 patients receive care in the hospital's
emergency department and more than 4,000 patients are admitted.

Over the past four years, AGH and SGH have become more closely
affiliated through a number of shared clinical programs, such as
urology, radiology, emergency medicine, integrated medicine and
anesthesiology.

Mr. Fedele stressed that, among other programs, emergency medicine
will continue to be a vital component of the services offered at
the AGH Suburban Campus. Additionally, though many specific
details relative to the ultimate configuration of clinical
programs at the facility still need resolution, employment will
remain the same as or possibly grow as a result of the transition.

"This move will not only maintain the employee base at Suburban
General, but may in fact expand it through the development of new
clinical programs," Mr. Fedele said.

"The announcement is great news for the community, the employees
of Suburban General and for the entire WPAHS family. The close
proximity between AGH and Suburban General has helped facilitate
greater collaboration between our respective staffs in recent
years to the significant benefit of the patients we serve. As we
examined the advantages of this evolving relationship relative to
the hospital's mission it became apparent that a more formal
strategic alliance would further advance the clinical capabilities
we present to our service area," said Melinda Meighan, chairperson
of SGH's Board of Directors.

"On the eve of our centennial anniversary, this transition marks a
rebirth for Suburban General into a new, stronger entity that will
define and guide its mission through the next century."

The integration of SGH and AGH will entail completion of a full
corporate merger between the two entities, including creation of a
single board of directors and integrated medical staffs.

"Given the significant level of clinical collaboration that has
been established between AGH and Suburban General over the past
couple of years, this new relationship is a natural transition
that will further benefit the communities served by both
hospitals," said Herbert Ellish, chairman of AGH's board of
directors.

WPAHS will make a substantial investment in the AGH Suburban
Campus, including information technology upgrades, building
infrastructure renovations, aesthetic improvements and clinical
upgrades.

"We are extremely excited about the possibilities of this merger,
particularly the new equity that it brings to our position as a
preferred healthcare provider in the northern region. Given our
existing partnerships with the AGH medical staff, this move is a
natural transition that will further benefit the patients we care
for and strengthen the relationships we have with independent
physician groups in the region who have also played an important
role in our success throughout the years," said David Reed, M.D.,
president of SGH's medical staff.

"We, too, are enthused with the development of the Suburban
Campus," commented Michael White, M.D., president of AGH's medical
staff. "The collaborative efforts of our medical staffs coupled
with enhancements in clinical programming at the hospital will be
of great benefit to residents in the northern suburbs."

The system has also pledged to maintain the Suburban Health
Foundation's mission of directing charitable donations to the
Suburban Campus facility and its programs, Ms. Meighan said.

"It is our intent to maintain in every way possible the tradition
and culture of care that exists at Suburban General and the unique
relationship that it has forged with its community," Ms. Meighan
said.

Clinical program development at the Suburban campus will begin in
the spring of 2005. Included among these is the transition to the
site of several key components of AGH's orthopedic surgery
program, including its division of adult reconstruction/joint
replacement surgery and division of physical medicine and
rehabilitation. Under the direction of Nicholas Sotereanos, M.D.,
AGH's joint replacement program is among the most advanced and
busiest programs in the state.

"Joint reconstruction is a cornerstone of our nationally
recognized orthopedic surgery program and we are enthusiastic
about its transition to the AGH suburban campus," said Patrick
DeMeo, Vice Chairman of AGH's Department of Orthopedic Surgery.

Following outstanding performance for AGH in fiscal 2004, the
merger with Suburban General represents a significant opportunity
for continued growth of the north side hospital's tertiary
services, said Connie Cibrone, AGH President and CEO. "The
unification of AGH and Suburban General will be remembered as
another important milestone for AGH," she said.

"This merger not only improves access to our clinical programs in
the growing northern communities, but enhances patient care at our
north side campus as well by expanding its ability to accommodate
increasing surgical volumes, demand for ICU beds and other patient
care needs."

Cibrone said that the transitioning of select inpatient and
outpatient surgical services to the Suburban Campus will allow AGH
to open its capacity in a number of key clinical areas.

WPAHS expects to complete the merger of the two hospitals by
January 1, 2005.

                           *     *     *

As reported in the Troubled Company Reporter on August 2, 2004,
Standard & Poor's Ratings Services revised its outlook to positive
from stable on West Penn Allegheny Health System (West Penn),
Pa.'s outstanding bonds issued by various issuers, reflecting
expectations that the rating will be raised within the year if
current financial and operating performance is sustained. In
addition, Standard & Poor's affirmed its 'B' underlying rating
(SPUR) and 'B' standard long-term rating on West Penn's debt.

"The positive outlook reflects successful management efforts to
stabilize and improve the financial and operating profile of this
credit, although it is still at a non-investment-grade rating
level," said Standard & Poor's credit analyst Cynthia Keller
Macdonald. "Although challenges remain, the current management
seems committed to continued profitability improvement, which, if
sustained, is likely to result in a higher rating in the near
term," she added.


* Accountants Face New Concerns Says Cendrowski Corporate Advisors
------------------------------------------------------------------
A recent revision of standards for accounting review services
could put many practitioners at risk, according to experts on
business fraud at Cendrowski Corporate Advisors (CCA).

Although the revised standard is designed to help accountants
improve their professional review, it can pose certain pitfalls
for accountants, says CCA founder Harry Cendrowski.

The revision, called SSARS 10 (Statements on Standards for
Accounting and Review Services), affects reviews of financial
statements ending on or after December 15, 2004. It was recently
issued by the American Institute of Certified Public Accountants
(AICPA) and is an expansion of previous guidelines on analytical
procedures and other review procedures.

Most notably, the new standard requires accountants to make
inquiries regarding fraud in a review process and to obtain added
input from a client's management regarding fraud, Cendrowski
notes. It also includes an implied responsibility for
understanding the internal controls for fraud deterrence within
the organization.

Cendrowski warns that accountants who are not prepared to properly
judge responses to these inquiries in order recognize the warning
signs of fraud, and communicate them to a client company's owners,
could be exposed to professional liability, whether the company is
public or privately held.

"Fraud studies consistently show that strong internal controls are
the most important defense against fraud," Cendrowski notes.
"Accountants will need to develop a mindset for fraud awareness
and deterrence in order to manage the risk associated with the
performance of a review."

"Fraud continues to be recognized as a major problem for business,
and the accounting profession will continue to modify professional
standards to consider the impacts of fraud," he says. "The new
standards dictated by the Sarbanes-Oxley Act raised the bar for
governance and financial reporting. These practices are now
becoming a benchmark for private companies and nonprofits as
well."

The risk to accountants is that they may not uncover a fraudulent
situation, given the often-subversive means used to conceal fraud.
Under the new standard, the accountant could be held responsible
for not discovering it.

For this reason, accountants will need to fully understand the
many elements of fraud when providing review services under the
new standard.

In 2003, Cendrowski and senior manager Jim Martin developed and
licensed the training program for the Certified Fraud Deterrence
(CFD) professional designation offered by the National Association
of Certified Valuation Analysts (NACVA). The CFD program is the
first new fraud designation by any national professional
organization in the past 20 years.

The objectives of the training program mirror those of the
Sarbanes-Oxley Act as well as recent statements by Securities and
Exchange Commission leaders about proactive deterrence of fraud
for both private and public companies. The CFD program includes 40
hours of classroom instruction, an eight-hour exam and a
comprehensive written case analysis incorporating CCA's unique
proactive measures to deter fraud in an organization. The fraud-
deterrence training program is now held across the country and
attended by professionals from corporate, private, government and
non-profit organizations.

Cendrowski Corporate Advisors provides consulting services to
private, public and non-profit organizations, including forensic
accounting; internal control assessment and fraud deterrence;
fraud investigation and remediation; expert witness; fraud
deterrence training & education; business valuation; risk
assessment; operational review; litigation support; internal
audit; business continuity planning, and bankruptcy and fiduciary.


* Gregory Ford Joins Alvarez & Marsal as Director
-------------------------------------------------
Alvarez & Marsal, a diversified global professional services firm,
announced that Gregory T. Ford, a real estate capital market
transaction specialist, has joined the firms Real Estate Advisory
Services group as a Director.

With more than 13 years of experience in real estate structured
finance, consulting and accounting, Mr. Ford brings a proven track
record of addressing critical real estate business decisions.
Prior to joining A&M, he served as a Vice President in the real
estate structured finance group of a major Wall Street investment
bank, where he was responsible for underwriting over $2.5 billion
of commercial real estate transactions, including office, retail,
multi-family, industrial, medical office and self storage
properties.   Over the course of his career, he also gained
significant experience in commercial real estate lending, having
participated in a $2.2 billion acquisition of a manufactured
housing portfolio one of the largest commercial mortgage backed
securities transactions.

Greg brings an outstanding background in real estate finance and
accounting to Alvarez & Marsal,said William BiffMcGuire, an A&M
Managing Director and head of the firms Real Estate Advisory
Services group.  His substantial experience and expertise in real
estate-related mortgage banking and capital market activities will
be invaluable in enhancing our breadth of offerings and serving
the needs of a broad array of clients.

Based in A&Ms Atlanta office, Mr. Ford will oversee business
development within the Southeastern United States.  HeHe He holds
a masters degree in finance, with a concentration in real estate
finance from the University of Central Florida in Orlando, FL.
Mr. Ford is also a Certified Commercial Investment Member (CCIM)
candidate.

Alvarez & Marsals Real Estate Advisory Services group provides
independent and objective consultation and analysis to real estate
owners, investors, lenders and corporate users.  A&M professionals
work closely with clients to develop and execute sophisticated
real estate strategies aimed at improving operations, unlocking
value or shedding risk.   The groups mortgage banking and capital
market services include: offering memorandums for debt placement;
debt sourcing (including fixed, floating and mezzanine debt); loan
underwriting services (including single asset and portfolio
loans); and property inspections.

                     About Alvarez & Marsal

Founded in 1983, Alvarez & Marsal is a global professional
services firm that helps businesses organizations in the corporate
and public sectors navigate complex business and operational
challenges.  With professionals based in locations across the US,
Europe, Asia, and Latin America, Alvarez & Marsal delivers a
proven blend of leadership, problem solving and value creation.
Drawing on its strong operational heritage and hands-on approach,
Alvarez & Marsal works closely with organizations and their
stakeholders to help navigate complex business issues, implement
change and favorably influence results.  For more information
about the firm, please visit
http://www.businessconsulting.alvarezandmarsal.com/>
www.businessconsulting.alvarezandmarsal.com
or contact Rebecca Baker, Chief Marketing Officer at 212.759.4433.
To find out more about the Business Consulting Group of Alvarez &
Marsal, contact Tom Elsenbrook, Managing Director at 713.259.7080.


* BOND PRICING: For the week of September 13 - September 17, 2004
----------------------------------------------------------------

Issuer                                Coupon   Maturity  Price
------                                ------   --------  -----
American & Foreign Power               5.000%  03/01/30    72
AMR Corp.                              4.500%  02/15/24    69
AMR Corp.                              9.000%  08/01/12    68
AMR Corp.                              9.000%  09/15/16    69
AMR Corp.                             10.200%  03/15/20    62
Burlington Northern                    3.200%  01/01/45    56
Calpine Corp.                          7.750%  04/15/09    63
Calpine Corp.                          8.500%  02/15/11    64
Calpine Corp.                          8.625%  08/15/10    65
Calpine Corp.                          8.750%  07/15/07    75
Comcast Corp.                          2.000%  10/15/29    41
Continental Airlines                   4.500%  02/01/07    71
Delta Air Lines                        7.700%  12/15/05    48
Inland Fiber                           9.625%  11/15/07    48
Level 3 Comm. Inc.                     2.875%  07/15/10    68
National Vision                       12.000%  03/30/09    65
Northern Pacific Railway               3.000%  01/01/47    55
Northwest Airlines                     7.875%  03/15/08    70
Northwest Airlines                     8.700%  03/15/07    74
Northwest Airlines                     9.875%  03/15/07    72
US West Capital                        6.500%  11/15/18    72
US West Capital Fdg.                   6.875%  07/15/28    71
Zurich Reinsurance                     7.125%  10/13/23    74


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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.

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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, Emi Rose S.R. Parcon, Bernadette C. de Roda, Rizande B.
Delos Santos, Jazel P. Laureno, Cherry Soriano-Baaclo, Marjorie
Sabijon 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.

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