TCR_Public/040921.mbx       T R O U B L E D   C O M P A N Y   R E P O R T E R

         Tuesday, September 21, 2004, Vol. 8, No. 203

                          Headlines

ADAHI INC: U.S. Trustee Meets Creditors on Oct. 25
AES CORP: Improving Credit Matrix Cues S&P to Affirm Low-B Ratings
ALLIED WASTE: S&P Puts Stable Outlook on BB Corp. Credit Rating
ASIA PULP: Indonesian Court Invalidates $550M Bond Issue
BEACON HILL: Moody's Junks $25 Million Class C 3rd Priority Notes

BREUNERS: Real Estate Bids Must be in by September 29
CALPINE CORP: Commencing $360 Million Preferred Equity Offering
CATHOLIC CHURCH: Diocese of Tucson Files for Chapter 11 Protection
CATHOLIC CHURCH: Diocese of Tucson Chapter 11 Case Summary
CATHOLIC CHURCH: List of Diocese of Tucson's 20 Largest Creditors

CONSOLIDATED MEDICAL: Net Losses Raise Going Concern Doubt
CORPORATE BACKED: Delta's Junk Ratings Prompts S&P to Junk Certs.
COVANTA ENERGY: Asks Court to Close 62 Chapter 11 Cases
CRI-II: Inks Agreements to Sell Interests in Four Properties
DELTA AIR: Sky Chefs Conflict Disrupts Food Service

ECHOSTAR COMMS: Subsidiary to Discontinue Partnership with Qwest
ENER1 INC: Ability to Continue as a Going Concern is in Doubt
ENERGY VISIONS: Expects $1 Million Loss in Second Quarter
FALCON PRODUCTS: Levine Leichtman to Provide $135MM Refinancing
FINOVA CAPITAL: Withdraws Request for Thaxton to Produce Documents

FLYI INC: Reports 50.8% Load Factor for August 2004
FLYI INC: Analysts See Opportunities Due to Rivals' Bankruptcies
FOSTER WHEELER: Bud Cherry Now Leads Global Power Business
FOSTER WHEELER: Swap's 60% Minimum Threshold Remains Unmet
FOSTER WHEELER: Declares Recalculated Interest Rate for Sr. Notes

GLOBAL CROSSING: Representative Settles 2 Claims Totaling $2.3MM
GULFTERRA ENERGY: Moody's Affirms Ba2 Senior Implied Rating
HARVEST NATURAL: S&P Raises Senior Implied Rating to B3 from Caa1
HEADWATERS INC: Changes Names of Three Major Operating Divisions
HENRY CO: Moody's Affirms B3 & Junk Ratings & Says Outlook Stable

I-70 PRODUCTIONS: Case Summary & 20 Largest Unsecured Creditors
IASIS HEALTHCARE: Revises Third Quarter 2004 Earnings Release
INTEGRATED HEALTH: Tort Claimants Want Payment Under IHS Plan
INTERPOOL INC: Paying Cash Dividend to Common Stockholders
ION NETWORKS: Negative Financial Results Raise Going Concern Doubt

IPALCO ENTERPRISES: S&P Affirms BB+ Corporate Credit Rating
KENNAMETAL INC: Moody's Affirms Ba1 Long-Term Sr. Unsec. Ratings
MERRILL LYNCH: Fitch Affirms BB Rating After Interest Payment
MORGAN STANLEY: Fitch Junks $22.6 Million Class H Certificate
NEW VISUAL: Prepares Prospectus on 18.2 Million Common Shares

NORTHERN KENTUCKY: U.S. Trustee Picks 3-Member Committee
OCTAGON INVESTMENT: Moody's Puts Low-B Ratings on Class B-2L Notes
OHIO VALLEY: Fitch Shaves Bonds' Rating Two Notches to B+
OMNICARE INC: Expands Pharmaceutical Case Management Business
PACIFIC GAS: Files Gas Accord III Settlement with CPUC

PAM CAPITAL: Moody's Affirms Class B Notes' B1 Rating After Review
PEGASUS SATTELITE: Wants Exclusive Period Extended Until Nov. 30
PENN OCTANE CORP: SEC Declares Registration Statement Effective
PENTON MEDIA: Promotes Mollison & Blansfield to Executive Group
PREMIER FARMS: Court Declines to Approve Disclosure Statement

PROCESS GRAPHIC: Case Summary & 20 Largest Unsecured Creditors
RCN CORP: Court Sets Oct. 1 as Deadline for Filing Proofs of Claim
SANTA ROSA BAY: Bridge Shutdown Could Affect Fitch's BB- Rating
SEPRACOR INC: S&P Junks Planned $500 Mil. Convertible Senior Notes
SPANTEL COMMS: June Working Capital Deficit Narrows to $1.8 Mil.

STELCO: Monitor Ernst & Young Files 9th CCAA Restructuring Report
SYNIVERSE TECH: S&P Assigns BB- Rating to $279M Credit Facility
TEKNI-PLEX: S&P Pares Credit Rating to B- Due to Expected Loss
TEMBEC IND: Moody's Affirms Ba3 Ratings with Negative Outlook
TRANSPORTATION TECH: S&P Affirms B Corporate Credit Rating

UAL CORP: Settles Diana Brown-Dodson Claim for $5 Million
UNITED HERITAGE: Substantial Losses Trigger Going Concern Doubt
W.R. GRACE: Settles Honeywell Litigation for $62.5 Million
WEST PENN: Operational Progress Spurs Fitch to Affirm B+ Rating
WISE WOOD: Selling Remaining Downhole Services Assets for $850,000

WORLDCOM: New York Times Says MCI Is Looking for Buyers
WORLDCOM INC: Judge Gonzalez Approves ERISA Settlement Agreement

* Saber Partners Appoints Two Attorneys to Advisory Board

* Large Companies with Insolvent Balance Sheets

                          *********

ADAHI INC: U.S. Trustee Meets Creditors on Oct. 25
--------------------------------------------------               
The U.S. Trustee for Region 17 will convene a meeting of Adahi
Inc.'s creditors at 2:00 p.m. on October 25, 2004, at 300 Booth
Street, Room 2110 in Reno, Nevada.  This is the first meeting of
creditors required under 11 U.S.C. Sec. 341(a) in all bankruptcy
cases.

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

Headquartered in Incline Village, Nevada, Adahi Inc. filed for
chapter 11 protection on September 13, 2004 (Bankr. D. Nev.
Case No. 04-52718).  Stephen R. Harris, Esq., at Belding, Harris &
Petroni, Ltd., represents the Debtor in its restructuring efforts.  
When the Debtor filed for protection from its creditors, it
estimated more than $10 million in debts and assets.


AES CORP: Improving Credit Matrix Cues S&P to Affirm Low-B Ratings
------------------------------------------------------------------
Standard & Poor's Ratings Services revised its outlook on The AES
Corp. (AES; B+/Positive/--) to positive from stable following a
periodic review of the Arlington, Virginia-based company.  At the
same time Standard & Poor's affirmed its 'B+' corporate credit
rating on AES, its 'BB' rating on AES's senior secured exchange
notes, its 'B-' rating on AES's senior unsecured and subordinated
debt, and its 'CCC+' rating on AES's preferred stock.

The outlook revision reflects a trend of improving credit metrics
both at the parent level and on a consolidated basis over the past
year -- a trend that Standard & Poor's expects to continue based
on management's public statements regarding its goals for debt
reduction, and Standard & Poor's expectations of future portfolio
performance.

A positive outlook means that Standard & Poor's expects that the
rating is more likely to improve than to deteriorate or remain the
same over a one-to-three-year time horizon. "Standard & Poor's
believes that AES will maintain or improve the cash flow quality
of its portfolio, and that it will be able to reduce parent level
debt to about $4.5 billion over the next 18 to 24 months," said
credit analyst Scott Taylor.  "If the company can accomplish this
while maintaining its target liquidity of $400 million to
$600 million, Standard & Poor's is likely to upgrade the company
to 'BB-'".

The rating on AES reflects the risks of its reliance on
substantive distributions from jurisdictions where considerable
regulatory and operating uncertainties exist to support its
parent-level debt, some exposure to merchant power markets, and a
highly leveraged, though improving, balance sheet.  These risks
are tempered by the diversification of AES's portfolio, a stable
base of cash flow coming from its contractual generation
businesses and its regulated utility, Indianapolis Power & Light
Co., and a history of strong operations at its generation and
distribution businesses.

AES's management team has demonstrated a commitment to restoring
the company's credit quality, and moved it away from a strategy of
aggressive expansion toward a focus on its core competency of
operations.  AES will need to invest in new businesses to maintain
and grow its dividend stream, and the positive outlook is
predicated on such investments being credit neutral or enhancing.


ALLIED WASTE: S&P Puts Stable Outlook on BB Corp. Credit Rating
---------------------------------------------------------------
Standard & Poor's Ratings Services revised its outlook on Allied
Waste Industries, Inc., to stable from positive.  At the same
time, Standard & Poor's affirmed its ratings, including the 'BB'
corporate credit rating, on the company.  About $8 billion of debt
is outstanding.

"The outlook revision is based on reduced earnings and cash flow
prospects for 2004, stemming primarily from lower-than-expected
results in the higher-margin landfill business and increased fleet
repair and maintenance costs, which more than offset gains in
lower-margin services, including collection," said Standard &
Poor's credit analyst Roman Szuper.

"As a result, progress in debt reduction and a consequent
improvement to key credit protection measures will now be more
modest and gradual than anticipated earlier."

The ratings on Scottsdale, Arizona-based Allied Waste reflect a
below-average financial profile, which outweighs the firm's strong
competitive business position.

Allied Waste is the second-largest solid waste management
participant in the U.S., with 2004 revenues and EBITDA estimated
at about $5.4 billion and $1.47 billion-$1.5 billion,
respectively.  The company provides collection, transfer,
disposal, and recycling services to about 10 million residential,
commercial, and industrial customers in 37 states.  A national
network of facilities creates opportunities for modest growth
through internal development, focusing on the vertical integration
business model.

Efficient operations are enhanced by:

   * leading shares in most local markets,
   * a low-cost structure,
   * good collection-route density, and
   * a high rate of waste internalization.

Allied Waste's below-average financial profile stems mainly from
high debt levels incurred in the 1999 acquisition of Browning-
Ferris Industries Inc.  Debt reduction was accelerated in 2003 and
2004 from the issuance of common equity and mandatory convertible
preferred stock, the proceeds from divestitures, and free cash
flow.  Moreover, in December 2003, $1.3 billion of preferred stock
was converted into common stock, which strengthened the capital
structure and saved about $500 million in cash over the next six
years by eliminating future dividends.  In the intermediate term,
debt to EBITDA should improve somewhat to 4.5x-5x, EBITDA interest
coverage to 2.5x-3x, and debt to capital to 70%-75%.  Additional
strengthening is expected longer term.


ASIA PULP: Indonesian Court Invalidates $550M Bond Issue
--------------------------------------------------------
In a decision that undermines the legitimacy of Asia Pulp and
Paper's exchange offers, the District Court of Kuala Tungkal,
Indonesia has invalidated over $550 million in bonds sold in 1995
by APP International Finance Company B.V., and unconditionally
guaranteed by P.T. Lontar Papyrus Pulp & Paper Industry and Asia
Pulp & Paper Company Ltd. Although it did not dispute receiving
the funds, Lontar claimed the bond issuance was a "deceptive
scheme" perpetrated by the indenture trustee, collateral agent,
underwriter and depositary to generate fees.

The court found that the basic structure of the bond issuance, a
structure commonly used for an offshore bond issuance, and the
collateral security for the bonds are invalid under Indonesian
law. The bonds were issued under the laws of New York, registered
with the United States Securities and Exchange Commission and
underwritten by Morgan Stanley. At the time of the issuance, the
law firms representing the issuer, including White & Case and
Tumbuan Pane, provided legal opinions confirming the validity of
the bond issuance.

APP defaulted on $13.9 billion of debt in 2001. Bonds with
virtually the same structure are being offered by the APP group in
exchange for defaulted Indonesian operating company debt as part
of APP's exchange offers launched in June of this year. "The
biggest victims may be the bondholders who have accepted the
exchange offers recently made by APP subsidiaries, Indah Kiat,
Tjiwi Kimia and Pindo Deli. The new bonds offered in these
exchanges, as highlighted in the risk disclosure section of the
exchange offer documents, utilize the same invalidated structure.
As such, they can be assumed to be invalid from the start and have
little hope of being enforced in Indonesia," said Robert L. Rauch,
Managing Director and Director of Research for Gramercy Advisors,
LLC (Gramercy).

The Indonesian ruling, already under appeal, was not unexpected
given the fact that several prominent Indonesian corporate
debtors, including APP, have in the last two years started to use
the local legal system to sue their creditors and nullify
international financings. According to the ruling, Lontar and APP
do not need to repay to bondholders the $550 million borrowed nor
accrued interest. All defendants, other than GE Capital, were
found to have contravened Indonesian law by participating in the
bond issuance. Named defendants include the indenture trustee, the
collateral agent, The Depository Trust Company (as bond instrument
depositary), Morgan Stanley (as underwriter) and bondholders GE
Capital, Oaktree Capital Management, LLC (Oaktree) and Gramercy.
GE Capital sold its bonds after the commencement of the lawsuits
in Indonesia. Pending the appeal process (which could take years)
under Indonesian law, the Indonesian judgment is not effective or
enforceable.

Earlier this year, bondholders Oaktree and Gramercy were awarded a
judgment by the New York Supreme Court of over $350 million
against APP, Lontar and affiliates based on defaulted bonds. In
recent developments, the bondholders have taken actions to enforce
their judgment throughout the United States and abroad,
restraining property such as cash and equipment. In New York, for
example, the creditors recently filed a motion to have the court
enforce restraining notices served on Indah Kiat prohibiting it
from dissipating any of its assets, including through any proposed
exchange offer. The creditors are seeking to have the court direct
key parties to the exchange offer to cease and desist from any
participation in the exchange offer.

The bondholders also filed a turnover proceeding in New York,
seeking to have the court direct APP to turn over all of its
assets to the creditors until the judgment is satisfied. Those
assets would include not only cash and other property, but also
the stock of APP's United States-based operating affiliates, APP
Trading (U.S.A.), APP U.S.A., Linden Trading Co., and PAK 2000.
The creditors have won numerous examination orders allowing them
to examine current and former employees in the APP group, as well
as trading partners of those entities, in order to determine the
location of APP assets for further seizure by the creditors.

"What has become clear during the course of the negotiations of
APP's debt restructuring is that APP has no interest in pursuing a
restructuring that conforms to international norms. It has refused
to even have a dialogue with its secured creditors who simply ask
that they be recognized in the restructuring as secured creditors
with a higher priority claim than unsecured creditors. Instead of
discussing these issues, APP chose to try to invalidate entire
series of secured bonds with these frivolous lawsuits in
Indonesia," said Melissa Obegi, Associate General Counsel for
Oaktree.

"While we would always prefer to negotiate, we have been left with
no other option but to pursue our legal rights as secured
creditors and, now, as judgment creditors. Our $350 million
judgment, issued by the New York court with jurisdiction over the
bonds, entitles us to pursue APP's assets wherever we can find
them, and we have been finding them. This recent irrational
judgment issued by a court in Indonesia lacking jurisdiction will
have no effect on our ability to enforce our New York judgment in
countries with legal systems that respect the rule of law. Unless
APP chooses to retreat from global commerce entirely, as long as
our judgment remains unsatisfied, they will have to deal with us,"
finished Obegi.

Mr. Rauch continued: "As much as APP gives lip-service to it,
there is no 'consensual' restructuring. APP negotiated a deal with
a handpicked group of creditors that do not represent the
interests of all of their creditors. Now APP is trying to force
the same deal on the majority of its creditors, using heavy-handed
threats that they will try to invalidate SEC-registered bonds of
anyone who disagrees. Although APP continues to try to
characterize the legitimate legal actions of certain of its
secured creditors as merely a 'flagrant abuse of position,' APP's
unwillingness to engage in discussions respecting international
norms for consensual restructurings is purely an attempt by the
controlling shareholders to profit unjustly at the expense of its
creditors. Unfortunately, this strategy is likely to preclude a
normalization of APP group operations to the detriment of all
other stakeholders, potentially for years to come."

                        About the Company

Asia Pulp and Paper Company Ltd. is a vertically integrated pulp
and paper producer in Asia (except Japan) and throughout the
world.  The Company produces a variety of printing and writing
paper including coated and uncoated freesheets, cut-sized
photocopier paper, stationery, carbonless paper, and a range of
tissue paper products.


BEACON HILL: Moody's Junks $25 Million Class C 3rd Priority Notes
-----------------------------------------------------------------
Moody's Investors Service has taken rating action on all Moody's
rated classes of Notes issued by Beacon Hill CBO II, Ltd.

The affected tranches are:

   (1) U.S.$160,500,000 Class A-1 Senior Secured Floating Rate
       Term Notes, due 2034, now Aaa on watch for possible
       downgrade (previously rated Aaa),

   (2) U.S.$160,500,000 Class A-2 Senior Secured Floating Rate
       Revolving Notes, due 2034, now Aaa on watch for possible
       downgrade (previously rated Aaa),

   (3) U.S.$14,000,000 Class B Second Priority Floating Rate Term
       Notes, due 2034, now Ba1 on watch for possible downgrade
       (previously rated A3 on watch for possible downgrade),

   (4) U.S.$13,000,000 Class C-1 Third Priority Floating Rate Term
       Notes, due 2034, now Ca (previously rated B3 on watch for
       possible downgrade), and

   (5) U.S.$12,000,000 Class C-2 Third Priority Fixed Rate Term
       Notes, due 2034, now Ca (previously rated B3 on watch for
       possible downgrade).

The rating action reflects the further deterioration in credit
quality of the underlying collateral pool.  Moody's noted that as
of the August Monthly Report distributed by the trustee, the
Issuer remains in violation of the Moody's Maximum Rating
Distribution Test and is also violating the Adjusted
Overcollateralization Test, the Class A Interest Coverage Test and
the Class B Interest Coverage Test.

Rating Action: Downgrade

Tranches affected:

   (1) U.S.$160,500,000 Class A-1 Senior Secured Floating Rate
       Term Notes, Due 2034

       Previous rating: Aaa

       Current rating:  Aaa on watch for possible downgrade

   (2) U.S.$160,500,000 Class A-2 Senior Secured Floating Rate
       Revolving Notes, Due 2034

       Previous rating: Aaa

       Current rating:  Aaa on watch for possible downgrade

   (3) $14,000,000 Class B Second Priority Floating Rate Term
       Notes, Due 2034

       Previous rating: A3 on watch for possible downgrade

       Current rating:  Ba1 on watch for possible downgrade

   (4) $13,000,000 Class C-1 Third Priority Floating Rate Term
       Notes, Due 2034

       Previous rating: B3 on watch for possible downgrade

       Current rating:  Ca

   (5) $12,000,000 Class C-2 Third Priority Fixed Rate Term Notes,
       Due 2034

       Previous rating: B3 on watch for possible downgrade

       Current rating:  Ca


BREUNERS: Real Estate Bids Must be in by September 29
-----------------------------------------------------
Breuners Home Furnishings Corp. retained Keen Realty, LLC to
market and dispose of the company's retail, distribution center,
and office leasehold interests located throughout the northeast
and northern California.  Keen reported that the leaseholds will
be auctioned on October 6, 2004.  The deadline for submitting bids
is September 29, 2004.  Breuners is the parent company to Huffman
Koos, Good's Furniture, and Breuners Home Furnishings, all
featuring quality, value-priced brand named furniture.  Breuners
Home Furnishings filed for Chapter 11 protection on July 14, 2004
in the United States Bankruptcy Court District of Delaware.  Keen
Realty is a real estate consulting firm specializing in maximizing
the value of its clients' real estate assets nationwide.

"We have been marketing these leasehold interests for
approximately two months.  We have received an overwhelming amount
of interest, as the leases are located in prime locations
throughout the northeast and in northern California," said Matthew
Bordwin, Keen Realty's Executive Vice President.  "Interested
parties must submit bids as per the Court approved bid procedures
no later than September 29th.  Qualified bidders will have the
opportunity to compete for the locations at the auction on
October 6th," Mr. Bordwin added.

These locations are available:

   -- Operating as Huffman Koos:

      * 20 retail leases, consisting of 997,751+/- sq. ft. of
        retail space, located in New York, New Jersey, and
        Connecticut, and

      * two distribution centers totaling 450,608+/- sq. ft.
        located in Connecticut and New Jersey;

   -- Operating as Good's Furniture:

      * 17 retail leases, consisting of 679,009+/- sq. ft. of
        retail space, located in Pennsylvania, New Jersey, and
        Delaware, and

      * two distribution centers totaling 178,000+/- sq. ft.
        located in Delaware and Pennsylvania;

   -- Operating as Breuners Home Furnishings:

      * Ten retail leases, consisting of 485,011+/- sq. ft. of
        retail space, and

      * one distribution center totaling 130,140+/- sq. ft.,
        located in northern California.

Also available is an office/headquarters location consisting of
31,256+/- sq. ft. located in Lancaster, Pennsylvania.

For over 22 years, Keen Consultants has had extensive experience
solving complex problems and evaluating and selling real estate,
leases and businesses.  Keen Consultants, a leader in identifying
strategic investors and partners for businesses, has consulted
with hundreds of clients nationwide, evaluated and disposed of
over 250,000,000 square feet square of properties, and
repositioned nearly 13,000 retail stores across the country.
Recent clients include: Spiegel/Eddie Bauer, Arthur Andersen,
Service Merchandise, Country Road, Tommy Hilfiger, Warnaco, Fila,
and JP Morgan Chase.

For more information regarding the disposition of these leaseholds
for Breuners Home Furnishings Corp., contact:

      Keen Realty, LLC
      60 Cutter Mill Road, Suite 407
      Great Neck, NY 11021
      Telephone: 516-482-2700
      Fax: 516-482-5764
      E-mail: mbordwin@keenconsultants.com
      Attn: Matthew Bordwin

Headquartered in Lancaster, Pennsylvania, Breuners Home
-- http://www.bhfc.com/-- is one of the largest national  
furniture retailers focused on the middle to upper-end segment of
the market.  The Company, along with its debtor-affiliates, filed
for chapter 11 protection on July 14, 2004 (Bankr. Del. Case No.
04-12030).  Great American Group, Gordon Brothers, Hilco Merchant
Resources, and Zimmer-Hester were brought on board within the
first 30 days of the bankruptcy filing to conduct Going-Out-of-
Business sales at the furniture retailer's 47 stores.  Bruce
Grohsgal, Esq., and Laura Davis Jones, Esq., at Pachulski, Stang,
Ziehl, Young & Jones represent the Debtors in their restructuring
efforts.  The Company reported more than $100 million in assets
and liabilities when it sought protection from its creditors.


CALPINE CORP: Commencing $360 Million Preferred Equity Offering
---------------------------------------------------------------
Calpine Corporation (NYSE: CPN) reported that Calpine (Jersey)
Limited, a new company being formed as an indirect, wholly owned
subsidiary of Calpine, intends to commence an offering of $360
million of two-year Redeemable Preferred Shares.  The offering is
subject to the receipt of certain regulatory approvals.

The proceeds of the offering of the Redeemable Preferred Shares
will be initially loaned to Calpine's 1,200-megawatt Saltend
cogeneration power plant located in Hull, Yorkshire, England, and
the payments of principal and interest on such loan will fund
payments on the Redeemable Preferred Shares.

The net proceeds of the Redeemable Preferred Shares offering will
ultimately be used as permitted by the company's indentures.

The Redeemable Preferred Shares have not been registered under the
Securities Act of 1933, and may not be offered in the United
States absent registration or an applicable exemption from
registration requirements.  The Redeemable Preferred Shares will
be offered in a private placement in the United States under
Regulation D under the Securities Act of 1933 and outside of the
United States pursuant to Regulation S under the Securities Act of
1933.

                         About Calpine

Calpine Corporation (S&P, B, CCC+ Senior Unsecured Convertible
Note and B Second Priority Senior Secured Note Ratings, Negative
Outlook), is a North American power company dedicated to providing
electric power to customers from clean, efficient, natural gas-
fired and geothermal power facilities.  The company generates
power at plants it owns or leases in 21 states in the United
States, three provinces in Canada and in the United Kingdom.  
Calpine is also the world's largest producer of renewable
geothermal energy, and owns or controls approximately one trillion
cubic feet equivalent of proved natural gas reserves in the United
States and Canada. For more information about Calpine, visit
http://www.calpine.com/

                         *     *     *

As reported in the Troubled Company Reporter on Sept. 20, 2004,
these notes currently trade in the mid-sixties:

   * 7.750% notes due April 15, 2009;
   * 8.500% notes due February 15, 2011; and
   * 8.625% notes due August 15, 2010.

As reported in the Troubled Company Reporter on August 18, 2004,
Calpine Corp.'s outstanding $5.5 billion senior unsecured notes
are affirmed at 'B-' by Fitch Ratings. In addition, CPN's
outstanding $2.9 billion second priority senior secured notes are
affirmed at 'BB-' and its $1.1 billion outstanding convertible
preferred securities/high TIDES at 'CCC'.  The Rating Outlook for
CPN is Stable.

CPN's ratings reflect its highly leveraged financial profile and
exposure to cyclical commodity market conditions, which continue
to reduce realized returns on the unhedged portion of CPN's
generating portfolio.  In addition, CPN's remaining plant
construction program will continue to place near-term pressure on
the company's credit profile as cash inflows and earnings tend to
lag investment expenditures.  For the twelve-month period ended
March 31, 2004, lease adjusted debt to EBITDAR exceeded 10.0 times
(x).  CPN continues to pursue the sale of some of its more liquid
assets, including the planned sale of approximately 230 billion
cubic feet equivalent (Bcfe) of Canadian-based natural gas
reserves and ongoing monetization of above-market power sales
contracts, further reducing financial flexibility.

CPN's credit measures could conceivably strengthen over the next
several years as new projects enter commercial operation and begin
to produce cash flows.  However, upward movement in CPN's ratings
would require both a cyclical recovery in spark spreads and
deployment of free cash flow generated from this recovery toward
meaningful debt reduction.  The degree to which CPN is successful
in negotiating new long-term power sales agreements will also have
a potentially positive impact on the current ratings.  However, to
the extent that new contracts relate to incremental plant
development, rather than contracting CPN's existing asset
portfolio, CPN could face continuing liquidity risk to the extent
new construction activity is primarily debt-funded.  In this
regard, advance realization of equity profits through contract
monetizations, while having proven critical to the resolution of
near-term liquidity issues, could further delay a sustained
recovery in financial measures.

Favorable credit considerations include CPN's sound operating
fundamentals and the core competencies of CPN's power generating
activities.  CPN operates a geographically diverse portfolio of
highly efficient base load natural gas-fired generating units.
With approximately 52% of its estimated 2004 power sales hedged
under long-term contracts primarily with creditworthy utilities,
municipalities, co-ops, and other load-serving entities, CPN is
somewhat insulated in the near term from the depressed spark
spread environment.  However, Fitch notes that, absent any new
contracts, the percentage of CPN's generating portfolio under
contract would decline to around 35% by 2006.

CPN's senior secured rating is three notches higher than CPN's
senior unsecured rating, reflecting the enhanced structural
position of secured creditors and Fitch's evaluation of the
underlying collateral package.  The secured notes are
collateralized by a second priority lien on substantially all of
the assets owned directly by CPN, including natural gas reserves
and certain generating facilities.  In addition, the notes are
secured by a second priority pledge of equity interests in most of
CPN's first tier domestic subsidiaries.  Although the new secured
notes are effectively subordinated to approximately $6.2 billion
of subsidiary debt and lease obligations, in Fitch's view, the
secured creditors are afforded reasonable asset protection given
the lower proportion of secured debt, relative to total corporate
debt at the CPN holding company level.

Moreover, the terms of CPN's most significant subsidiary debt
obligations, including $3.2 billion of secured construction debt,
do not feature overly restrictive cash trapping mechanisms.  Fitch
has reviewed its recovery analysis in light of recent discussions
regarding the potential monetization of CPN's Canadian gas
reserves.  Assuming sale proceeds are used to repay outstanding
first-priority debt, the immediate impact on recovery rates for
CPN's second priority secured debt is relatively neutral.  CPN's
senior unsecured debt has lower recovery prospects as a
consequence of the security pledged to first and second lien
creditors.

The current Stable Outlook reflects CPN's success in eliminating
all remaining 2004 liquidity hurdles, including the refinancing of
$2.4 billion of secured subsidiary construction debt, which would
have matured in November 2004 and repurchased $1 billion of
convertible securities, which could have been put back to CPN in
December 2004.  As a result, remaining debt maturities over the
2004-2006 timeframe are relatively modest and should not create
any significant liquidity stress.  However, CPN is faced with the
maturity of approximately $2.4 billion of senior unsecured debt
obligations in 2008, and the company's prospects for refinancing
are highly dependent on favorable power market and capital market
circumstances.  In the meantime, conservatively forecast debt
service coverage measures remain tight and with over $3 billion of
floating-rate debt, CPN is sensitive to increasing interest rates.
CPN's inability to de-leverage ahead of its 2008 maturities will
likely result in downward pressure on CPN's ratings.


CATHOLIC CHURCH: Diocese of Tucson Files for Chapter 11 Protection
------------------------------------------------------------------
Bishop Gerald F. Kicanas directed the filing of a voluntary
petition for a Chapter 11 reorganization and a plan of
reorganization for the Diocese of Tucson in the U.S. Bankruptcy
Court for the District of Arizona, Tucson Division.

Attorneys for the Diocese filed the petition electronically at 8
a.m. Monday morning.  The attorneys filed the plan of
reorganization and a disclosure statement late yesterday.

In a letter that the Bishop has asked be communicated this week to
parishioners at the 75 parishes in the nine-county diocese, the
Bishop tells Catholics that he believes the reorganization of the
Diocese under Chapter 11 represents "the best opportunity for
healing and for the just and fair compensation of those who
suffered sexual abuse by workers for the Church in our Diocese."

Drawing upon scripture in his letter with a quote from St. Paul's
Second Letter to the Corinthians, Bishop Kicanas urges Catholics
to "be compassionate, be encouraged."

"We need compassion to reach out to all those who have been abused
by workers for the Church," the Bishop writes. "They are our
sisters and brothers who truly deserve our compassion, respect and
our love."

The Bishop asks Catholics to read a letter he has written to
victims of abuse about his decision to file for Chapter 11
reorganization. He asks Catholics to reflect on how they can help
bring about healing.

The Bishop also urges Catholics to be encouraged as their Diocese
enters the Chapter 11 process, telling them "it will allow us to
continue the mission of the Church in our Diocese.

"We need encouragement to continue and even to augment the mission
that Christ has entrusted to us. That mission is desperately
needed in our society, perhaps even more so now than at any other
time in our history."

The Chapter 11 process, the Bishop writes, "will establish an
orderly way, under the supervision of the Bankruptcy Court, by
which those who have been harmed can make a claim and have that
claim evaluated for possible compensation."

"I firmly believe that this reorganization plan is the best way
for the Diocese to work constructively with all those who are
victims -- those who have pursued compensation and those who have
not; those who are known and those who have not yet come forward,"
the Bishop writes.

The Bishop informs Catholics that the Diocese did everything it
could to settle the pending abuse lawsuits, but, the Bishop
writes, "I could not have agreed to a settlement if it would have
meant stripping the Diocese of everything and thus limiting our
ability to respond to the needs of others who have been hurt who
may come forward in the future."

He also tells Catholics that the Diocese will continue to try to
resolve these cases and any others that come forward in a
consensual manner in the context of the reorganization case, if it
is possible to do so.

In his letter to victims of abuse about his decision to file for
Chapter 11 reorganization, Bishop Kicanas writes, "I think of you
with concern and with a longing to restore your trust and heal
your hurt. I truly hope that you will understand what has
motivated my decision.

"To each of you I extend my deepest personal sorrow, and I
communicate to you the sorrow of all the people of the Church of
the Diocese of Tucson."

The Bishop tells victims that the Diocese has not filed for
Chapter 11 to avoid its responsibility to them.

"On the contrary," the Bishop writes, "I truly see the
reorganization process and the reorganization plan that we have
submitted as the only and best way that the Diocese can address
its responsibility to you, can continue to meet its commitment to
institute programs to prevent abuse, and can continue its mission
to all those who depend upon the ministry and outreach of the
Church."

The Bishop's letters about the filing as well as other relevant
information are posted on the Diocesan Web site at
http://www.diocesetucson.org/under "Chapter 11 Financial  
Reorganization."

           Response of Parishes to Filing by Diocese

In August, the pastors of parishes within the Diocese of Tucson
formed a committee to explore, with the assistance of legal
counsel hired by the parishes, the possible implications for
parishes of a Chapter 11 reorganization by the Diocese.

The members of the committee are Msgr. Thomas Cahalane, pastor of
Our Mother of Sorrows Parish in Tucson; Msgr. Robert Fuller,
pastor of St. Frances Cabrini Parish in Tucson; and Rev. Domenico
Pinti, pastor of St. George Parish in Apache Junction.

Parishes within the Diocese of Tucson now are represented in
matters related to the reorganization case and the Plan of
Reorganization by their own legal counsel.

Communication regarding the response of parishes to the filing by
the Diocese will come from the committee.

                  What the Diocese Is Filing

While only the filing of a Voluntary Petition is necessary to
initiate a Chapter 11 case, the filing by the Diocese is
comprehensive in that it will include all the forms, schedules,
statements, Plan of Reorganization and associated documentation
that are required under Chapter 11 of the Bankruptcy Code.

             Components of Plan of Reorganization

The Diocese's plan of reorganization proposes a process by which
the claims of victims can be determined and satisfied.

It provides for the Diocese to establish two trusts, and gives
victims the right to elect to have their claims tried by a jury or
determined in a different process by a master.

The plan of reorganization provides the framework by which the
process will be accomplished and the plan funded. It also provides
for the satisfaction of the claims of other creditors of the
Diocese.

                    Background Information

The Diocese is one of the oldest corporations in the state of
Arizona. Bishop Henri Granjon, the second Bishop of Tucson,
incorporated the Diocese in 1914 as a corporation sole under the
name of "Roman Catholic Church of the Diocese of Tucson."

The original articles state the object of the corporation was "the
care and administration of the temporal affairs of the Roman
Catholic Church of the Diocese of Tucson, which embraces the State
of Arizona, and a portion of the State of New Mexico, and
religious, educational, and charitable ministrations, and
maintenance and care of all the property now held, or that may be
received, by the said Roman Catholic Church of the Diocese of
Tucson."

The 1914 articles of incorporation have been amended over the
years to reflect the succession of bishops and changes in the
territory of the Diocese.

In 1969, the Diocese of Phoenix was formed from the Diocese of
Tucson, leaving the Diocese of Tucson with its present territory
of La Paz, Yuma, Pinal, Pima, Gila, Santa Cruz, Cochise, Graham,
and Greenlee counties. Geographically, the Diocese is the fifth
largest diocese in the continental U.S. with an area of 42,707
square miles.

In a total population of 1.45-million in the counties that
comprise the territory of the Diocese, there are an estimated
300,000-plus Roman Catholics who are served by 75 parishes, dozens
of missions, and 28 Catholic schools (20 parochial and eight
private).

The Diocese has 43 employees (34 full-time and nine part-time).
Full-time employees include Bishop Kicanas, two priests, two
sisters and 29 lay persons. Part-time employees include one
priest, one sister and seven lay persons.

Church personnel who minister in the territory of the Diocese
include 189 priests, 238 religious women (sisters), 143 deacons,
nearly 1,000 lay employees of parishes and schools and 36 lay
employees of the Diocese itself. The majority of all Church
personnel are employees of parishes and schools.

In addition, there are thousands of volunteers who participate in
the spiritual and service ministries of the parishes and schools.

Catholic schools in the territory of the Diocese, including the
parochial schools, have a total enrollment of 7,753 students. More
than 22,000 Catholic children who attend public schools receive
religious education through parish religious education programs.

Roman Catholics are approximately 25 per cent of the total
population within the territory of the Diocese. Within the
Catholic population, 25 per cent are Hispanic, 67 per cent Anglo,
four per cent Native American, three per cent Black American and
the remaining one per cent are of other nationalities.

                      Pending Litigation

There are 22 pending suits (33 plaintiffs) naming the Diocese that
allege abuse of children by priests.  There are two other pending
lawsuits.  The filing of Chapter 11 automatically imposes a stay
on all litigation. Plaintiffs in the lawsuits become claimants
(creditors) in the Chapter 11 case.
   

CATHOLIC CHURCH: Diocese of Tucson Chapter 11 Case Summary
----------------------------------------------------------
Debtor:  Roman Catholic Church of the Diocese of Tucson
         aka The Diocese of Tucson
         111 S. Church Avenue
         Tucson, Arizona 85701
         Telephone (520) 792-3410
         Fax (520) 838-2590
         http://www.diocesetucson.org/

Chapter 11 Petition Date: September 20, 2004

Bankruptcy Case No.: 04-04721

Bankruptcy Court: United States Bankruptcy Court
                  District of Arizona
                  U.S. Bankruptcy Court
                  110 S. Church Ave., Ste 8112
                  Tucson, AZ 85701
                  Telephone (520) 620-7500                  

Bankruptcy Judge: The Honorable James M. Marlar

Circuit:          Ninth

Debtor's
Bankruptcy
Counsel:          Susan G. Boswell, Esq.
                  Kasey C. Nye, Esq.
                  Quarles & Brady Streich Lang LLP
                  One South Church Ave., Suite 1700
                  Tucson, AZ 85701-1621
                  Telephone (520) 770-8700

Debtor's
Special
Litigation
Counsel:          Thomas A. Zlaket, Esq.
                  Thomas A. Zlaket, P.L.L.C.
                  310 S. Williams Blvd., Suite 170
                  Tucson, AZ 85711-4446
                  Telephone (521) 750-0250

Debtor's General
Business Counsel: Gerard R. O'Mera, Esq.
                  Gust Rosenfeld, P.L.C.
                  One S. Church Avenue, Suite 1900
                  Tucson, Arizona 85701-1627
                  Telephone (520) 628-7070  

Debtor's
Accountants:      Christopher G. Linscott
                  Keegan, Linscott & Kenon, P.C.
                  33 N. Stone Avenue, Suite 101
                  Tucson, AZ 85701
                  Telephone (520) 884-0176

U.S. Trustee:     U.S. Trustee for Region 14
                  P.O. Box 36170
                  Phoenix, AZ 85067-6170
                  Telephone (602) 640-2100
                  Fax (602) 640-2217

Estimated Number of Creditors:  200 to 999

Estimated Assets:  $10,000,000 to $50,000,000

Estimated Debts:   $10,000,000 to $50,000,000


CATHOLIC CHURCH: List of Diocese of Tucson's 20 Largest Creditors
-----------------------------------------------------------------
The Roman Catholic Church of the Diocese of Tucson released a list
of its 20 largest unsecured creditors:

Creditor                                           Claim Amount
--------                                           ------------
Catholic Order of Foresters                         
P.O. Box 3012
Naperville, IL 60566                                 $8,791,518

St. Thomas the Apostle Parish
5101 N. Valley View Road
Tucson, AZ 85718                                     $2,387,019

Our Lady of the Valley Parish
505 N. La Canada Dr.
Green Valley, AZ 85614                                 $591,261

Santa Catalina Mission
14380 N. Oracle Rd.
Tucson, AZ 85738                                       $447,494

St. Peter & Paul Parish
1946 E. Lee St.
Tucson, AZ 85719                                       $426,186

Immaculate Conception Parish
P.O. Drawer AF
Douglas, AZ 85607                                      $415,644

St. Monica Parish
212 W. Medina
Tucson, AZ 85706                                       $337,680

Sacred Heart Parish
601 E. Ft. Lowell
Tucson, AZ 85705                                       $341,660  

Our Lady of Lourdes
P.O. Box 2198
Benson, AZ 85602                                       $272,941

San Xavier Mission
1950 W. San Xavier Road
Tucson, AZ 85746                                       $173,702

St. Francis Cabrini Parish
3201 E. Presidio Rd.
Tucson, AZ 85716                                       $170,187

Most Holy Nativity Parish
P.O. Box 4024
Rio Rico, AZ 85648                                     $159,611

Terri Thiessen
3781 W. Golfcourse Rd.
Thatcher, AZ 85446                                     $150,323

First Catholic Slovak Ladies
24950 Chagrin Blvd.
Beachwood, OH 44122                                    $137,514

Sacred Heart Parish
P.O. Box 938
Nogales, AZ 85621                                      $132,834

Belen Alderete
215 N. West Moreland
Tucson, AZ 85745                                       $110,646

St. Martin de Porres Mission
P.O. Box 65
Sahurita, AZ 85639                                     $102,167

Our Mother of Sorrows Parish
1800 S. Kolb Rd.
Tucson, AZ 85710                                        $95,847

St. Bernard Parish
P.O. Box 310
Pirtleville, AZ 85626                                   $79,608

Our Lady of the Mountain Parish
1425 Yaqui St.
Sierra Vista, AZ 85635                                  $67,313


CONSOLIDATED MEDICAL: Net Losses Raise Going Concern Doubt
----------------------------------------------------------
Consolidated Medical Management, Inc., was incorporated under the
laws of the State of Montana on August 13, 1981 under the name
Golden Maple Mining and Leaching Company, Inc.  On
May 23, 1998, it changed its name to Consolidated Medical
Management, Inc.  In August 2001, the Company decided to refocus
on the oil and gas industry and is currently doing business as
Consolidated Minerals Management, Inc.  CMMI moved its corporate
office in July 2003 to Baton Rouge, LA.

For the quarter ended June 30, 2004, CMMI incurred a net loss of
$78,335 as compared to a net loss of $81,044 for the quarter ended
June 30, 2003.  The loss is attributable to the accrual of
expenses incurred for consultants and maintaining operations while
seeking to restructure its business operations.

The Company's recurring negative financial results raise
substantial doubt about the Company's ability to continue as a
going concern.

The Company currently anticipates that its existing cash and cash
equivalents balance will fund operations and continue energy
development at the current level of activity into the third
quarter of 2004. The Company will need to raise additional funds
through additional debt or equity financing. There can be no
assurance that additional equity or debt financing will be
available when needed or on terms acceptable to the Company.

The market price of the Company's common stock has fluctuated
significantly since it began to be publicly traded in 1998 and may
continue to be highly volatile. Factors such as the ability of the
Company to achieve development goals, ability of the Company to
profitably complete energy projects, the ability of the Company to
raise additional funds, general market conditions and other
factors affecting the Company's business that are beyond the
Company's control may cause significant fluctuations in the market
price of the Company's common stock. The market prices of the
stock of many energy companies have fluctuated substantially,
often unrelated to the operating or research and development
performance of the specific companies. Such market fluctuations
could adversely affect the market price for the Company's common
stock.

                        About the Company

Consolidated Medical Management, Inc. (CMMI) is a health care
management services organization.  The Company's holdings include
a psychiatric management company, independent diagnostic centers,
and other health service companies.  CMMI is active in
Southwestern U.S.


CORPORATE BACKED: Delta's Junk Ratings Prompts S&P to Junk Certs.
-----------------------------------------------------------------
Standard & Poor's Ratings Services lowered its ratings on all
classes of certificates issued by Corporate Backed Trust
Certificates Series 2001-6 Trust and Corporate Backed Trust
Certificates Series 2001-19 Trust.

Series 2001-6 and 2001-19 are swap independent synthetic
transactions that are weak-linked to the underlying securities,
Delta Air Lines Inc.'s 8.3% senior unsecured notes due Dec. 15,
2029.  The rating actions reflect the Sept. 16, 2004 lowering of
the senior unsecured debt ratings on Delta Air Lines Inc.

As reported in the Troubled Company Reporter on September 20,
2004, Standard & Poor's Ratings Services lowered selected ratings
on Delta Air Lines Inc., including lowering the corporate credit
rating to 'CC' from 'CCC', following the airline's launch of an
exchange offer for unsecured bonds and some aircraft-backed debt.
The outlook is negative.

"The downgrade reflects a high likelihood that, with the launch of
an exchange offer that would pay less than face value to certain
Delta bondholders, Standard & Poor's will shortly lower the
company's corporate credit rating either to 'SD' (selective
default), if the exchange offer is successful, or to 'D' if the
offer fails and Delta files for bankruptcy," said Standard &
Poor's credit analyst Philip Baggaley.  "The rating change does
not indicate a heightened risk of a bankruptcy filing, as a
successful exchange offer (which would require also fulfillment of
other conditions) could avert such an outcome.  

Accordingly, Standard & Poor's affirmed ratings on securities that
are not part of the exchange offer," the credit analyst continued.   
The downgrade also was not based on the going concern
qualification announced by Delta's auditors, though that
announcement underlines the gravity of the company's financial
outlook.

Delta proposes to offer up to $680 million of new secured notes to
holders of $2.2 billion of unsecured bonds and $471 million in
three junior classes of enhanced equipment trust certificates --
EETCs.  The new secured notes would consist of three classes that
are pari passu and have an equal claim on the same collateral
pool, but have different coupons and maturities.  The new notes
would be offered to existing bondholders, grouped by the maturity
of the securities that they hold currently, at various exchange
ratios.  There are numerous conditions attached to completion of a
successful exchange offer, including minimum issuance of
$612 million new notes and conclusion of a cost-saving contract
with Delta's pilots' union.  Delta has not requested credit
ratings on the exchange notes.  If the offer were fully subscribed
by each group of bondholders, Delta would reduce its total debt by
about $875 million, exchanging $680 million of new notes for about
$1.56 billion of existing bonds and certificates.

The exchange offer, which will be open until Oct. 14, 2004, is
intended to advance Delta's overall restructuring plan, which
seeks to combine cost cuts (an additional $2.7 billion of annual
cash savings by 2006, including $1 billion being sought from
pilots), enhanced customer service, debt reduction, and widespread
network changes (including the closure of Delta's hub at Dallas-
Fort Worth International Airport).  The proposed exchange offer,
although it does not materially reduce Delta's overall $20 billion
of debt and leases, would lighten near-term debt maturities and
help persuade pilots that management is seeking sacrifices from a
range of stakeholders, not just labor.

Ratings will be lowered to 'D' upon a bankruptcy filing or to 'SD'
upon a distressed debt exchange, such as that proposed Sept. 15,
2004.  A new corporate credit rating would be assigned after
completion of such an exchange.
   
                        Ratings Lowered
   
    Corporate Backed Trust Certificates Series 2001-6 Trust
    $57 million corporate-backed trust certs series 2001-6
   
                                Rating
                    Class    To        From
                    ----     --        ----
                    A-1      C         CC
                    A-2      C         CC
                    A-3      C         CC
  
    Corporate Backed Trust Certificates Series 2001-19 Trust
    $27 million corporate-backed trust certs series 2001-19
   
                                Rating
                    Class    To        From
                    -----    --        ----
                    A-1      C         CC
                    A-2      C         CC


COVANTA ENERGY: Asks Court to Close 62 Chapter 11 Cases
-------------------------------------------------------
Pursuant to Section 350 of the Bankruptcy Code and Rule 3022 of  
the Federal Rules of Bankruptcy Procedure, Covanta Energy
Corporation and its debtor-affiliates ask the United States
Bankruptcy Court for the Southern District of New York to close 62
Chapter 11 cases:

   Case No.    Debtor
   --------    ------
   02-40855    Covanta Power Development, Inc.
   02-40856    Covanta Power Development of Bolivia, Inc.
   02-40860    OPI Quezon, Inc.
   02-40861    Covanta Acquisition, Inc.
   02-40862    Covanta Bessemer, Inc.
   02-40866    Covanta Water Holdings, Inc.
   02-40868    Covanta Water Treatment Services, Inc.
   02-40871    Covanta Energy West, Inc.
   02-40872    Covanta Geothermal Operations, Inc.
   02-40873    Covanta Geothermal Operations, Holdings, Inc.
   02-40874    Covanta Hydro-Operations, Inc.
   02-40875    Covanta Hydro Operations West, Inc.
   02-40876    Covanta Imperial Power Services, Inc.
   02-40877    Covanta New Martinsville Hydro-Operations Corp.
   02-40879    Three Mountain Operations, Inc.
   02-40880    Three Mountain Power, LLC
   02-40881    Covanta Energy Americas, Inc.
   02-40882    Second Imperial Geothermal Co., L.P.
   02-40883    Covanta SIGC Geothermal Operation, Inc.
   02-40885    Covanta SIGC Energy, Inc.
   02-40886    AMOR 14 Corporation
   02-40887    Heber Geothermal Company
   02-40888    Heber Field Company
   02-40889    Heber Loan Partners
   02-40890    ERC Energy II, Inc.
   02-40891    ERC Energy, Inc.
   02-40892    Heber Field Energy II, Inc.
   02-40894    Covanta Hydro Energy, Inc.
   02-40895    Covanta Power Equity Corporation
   02-40898    Covanta Engineering Services, Inc.
   02-40901    Covanta Secure Services, Inc.
   02-40905    Covanta Honolulu Resource Recovery Venture
   02-40906    Covanta Hennepin Energy Resource, Co., LP
   02-40907    Covanta OPWH, Inc.
   02-40908    Covanta OPW Associates, Inc.
   02-40909    Covanta Operations of Union LLC
   02-40910    Covanta RRS Holdings, Inc.
   02-40911    Covanta Mid-Conn, Inc.
   02-40912    Covanta Oahu Waste Energy Recovery, Inc.
   02-40913    Covanta Projects of Hawaii, Inc.
   02-40914    Covanta Wallingford Associates, Inc.
   02-40915    Covanta Energy Resource Corp.
   02-40917    Covanta Long Island, Inc.
   02-40919    Covanta Huntington Resource Recovery One Corp.
   02-40920    Covanta Huntington Resource Recovery Seven Corp.
   02-40922    Covanta Onondaga, Inc.
   02-40923    Covanta Onondaga Two Corp.
   02-40924    Covanta Onondaga Three Corp.
   02-40925    Covanta Onondaga Four Corp.
   02-40926    Covanta Onondaga Five Corp.
   02-40927    Covanta Onondaga Operations, Inc.
   02-40930    Covanta Bristol, Inc.
   02-40938    Covanta Lee, Inc.
   02-40939    Covanta Marion, Inc.
   02-40941    Covanta Montgomery, Inc.
   02-40943    Covanta Pasco, Inc.
   02-40940    Covanta Marion Land Corporation
   02-40948    Covanta Systems, Inc./Ogden Martin Systems, Inc.
   02-40949    Covanta Waste to Energy, Inc.
   02-40946    Covanta Union, Inc.
   03-13706    Covanta Energy International, Inc.
   03-13708    Covanta Power International Holdings, Inc.

Section 350(a) provides that "[a]fter an estate is fully  
administered and the court has discharged the trustee, the court  
shall close the case."  Rule 3022 further provides that "[a]fter  
an estate is fully administered in a chapter 11 reorganization  
case, the court, on its own motion or on motion of a party in  
interest, shall enter a final decree closing the case."

Although neither the Bankruptcy Code nor the Bankruptcy Rules  
define "fully administered," the Advisory Committee's Note to  
Rule 3022 states that:

     "[F]actors that the court should consider in determining
     whether the estate has been fully administered include
     (1) whether the order confirming the plan has become final;
     (2) whether deposits required by the plan have been
     distributed; (3) whether the property proposed by the plan
     to be transferred has been transferred; (4) whether the
     debtor or the successor of the debtor under the plan has
     assumed the business or management of the property under the
     plan; (5) whether payments under the plan have commenced;
     and (6) whether all motions, contested matters, and
     adversary proceedings have been finally resolved."

James L. Bromley, Esq., at Cleary, Gottlieb, Steen & Hamilton in  
New York, tells the Court that on March 10, 2004, all of the  
conditions precedent to the effectiveness of the Debtors' Second  
Reorganization and Liquidation Plans have occurred or were  
waived.  The facts and circumstances of the 62 cases show that
each case has been fully administered:

   (a) The Reorganization Confirmation Order has become final;  

   (b) Deposits required by the Reorganization Plan have
       been distributed;  

   (c) Property proposed by the Reorganization Plan to be  
       transferred has been transferred;  

   (d) The Reorganized Debtors have assumed the business and     
       management of the property under the Reorganization Plan;  

   (e) Payments under the Reorganization Plan have commenced; and  

   (f) All motions, contested matters and adversary proceedings     
       have been finally resolved with regard to the 62 cases.

Mr. Bromley points out that the Court has no need to keep the  
cases open to exercise its jurisdiction over any outstanding  
matters.  Additionally, if the cases aren't closed, the  
Reorganized Debtors would unnecessarily continue to incur U.S.  
Trustee fees.

Headquartered in Fairfield, New Jersey, Covanta Energy Corporation
-- http://www.covantaenergy.com/-- is a publicly traded holding  
company whose subsidiaries develop, own or operate power
generation facilities and water and wastewater facilities in the
United States and abroad. The Company filed for Chapter 11
protection on April 1, 2002 (Bankr. S.D.N.Y. Case No. 02-40826).  
Deborah M. Buell, Esq., and James L. Bromley, Esq., at Cleary,
Gottlieb, Steen & Hamilton represent the Debtors in their
restructuring efforts.  When the Debtors filed for protection from
its creditors, they listed $3,280,378,000 in assets and
$3,031,462,000 in liabilities. (Covanta Bankruptcy News, Issue No.
65; Bankruptcy Creditors' Service, Inc., 215/945-7000)


CRI-II: Inks Agreements to Sell Interests in Four Properties
------------------------------------------------------------
C.R.I., Inc., as managing general partner of CRI-II, is pleased to
announce agreements to sell the partnership's limited partner
interests in four properties to affiliates of Equity Resource
Investments, LLC, a Massachusetts corporation. The aggregate
selling price for CRI-II's interests in the four properties is
$13,757,010.

The properties consist of apartment complexes located in Illinois
(2) and Maryland (2) that range in size from 120 units to 200
units. The closings of the transactions are subject to completing
due diligence and obtaining required government approvals. All
four sales are expected to occur in December 2004.

Affiliates of Equity Resources also will acquire the general
partner interests held by affiliates of CRI in these investment
properties.

Other affiliates of Equity Resources currently hold over 20% of
the outstanding interests in CRI-II.

The sale agreements partially implement the Plan of Liquidation
approved by CRI-II's investors pursuant to its February 14, 2004
consent solicitation. CRI-II is continuing to explore sale
opportunities for the remaining eight local partnerships in which
it owns an interest, including possible sales of certain interests
to Equity Resources affiliates.

CRI is a real estate investment firm based in Rockville, Maryland.
Its portfolio includes nearly 200 multi-family apartment complexes
located throughout the United States. CRI-II is a Maryland limited
partnership.


DELTA AIR: Sky Chefs Conflict Disrupts Food Service
---------------------------------------------------
Jeff St. Onge at Bloomberg News, while on Delta flight 570 from
Salt Lake City to Washington Dulles International Airport last
week, was offered snacks like raisins, muffins and applesauce
because LSG Sky Chefs didn't deliver meals for the four-hour
flight.  

Lynne Marek at Bloomberg News found that Delta didn't serve meals
on about 10 percent of flights because of a "conflict" with one of
its LSG Sky Chefs, citing Delta spokeswoman Benet Wilson as her
source.  Sky Chefs delined to provide Ms. Marek with additional
information about the "contractual disagreement."

"Right now we're working to make alternative arrangements and get
something in place in the next few days," Ms. Wilson told Ms.
Marek.  

Bloomberg News reports that most of Delta's food is provided by
Zurich-based Gate Gourmet International, which is owned by the
private equity firm Texas Pacific Group.  

Bill Brandt at Development Specialists Inc. speculates that
Delta's "conflict" with Sky Chefs may be a sign that Delta is
seeking to conserve cash ahead of a possible bankruptcy filing and
Sky Chefs is pressing for payment.  Ms. Marek notes that Sky Chefs
was stuck with millions of dollars in claims in other carriers'
chapter 11 cases.  "Airlines are horrible cases for trade
vendors," Mr. Brandt told Bloomberg reporters.  "Sky Chefs has
been invited to this party before and probably would to take a
pass on future festivities."

                        About Delta Air Lines

Delta Air Lines -- http://delta.com/-- 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.

                           *     *     *

As reported in the Troubled Company Reporter on Sept. 16, 2004,
Delta Air Lines filed a Form 8-K with the Securities and Exchange
Commission to make changes in its Annual Report on Form 10-K for
the year ended December 31, 2003.

The Annual Report is being revised so it may be incorporated into
another document. Since Delta filed the Annual Report with the
SEC, significant events have occurred which have materially
adversely affected Delta's financial condition and results of
operations. These events, which have been reported in Delta's
subsequent SEC filings, include a further decrease in domestic
passenger mile yield and near historically high levels of aircraft
fuel prices. The Annual Report has been revised to disclose these
events and the possibility of a Chapter 11 filing in the near
term. Additionally, as a result of Delta's recurring losses,
labor and liquidity issues and increased risk of a Chapter 11
filing, Deloitte & Touche LLP, Delta's independent auditors, has
reissued its Independent Auditors' Report to state that these
matters raise substantial doubt about the company's ability to
continue as a going concern.

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.


ECHOSTAR COMMS: Subsidiary to Discontinue Partnership with Qwest
----------------------------------------------------------------
EchoStar Communications Corporation's (NASDAQ: DISH) subsidiary,
EchoStar Satellite LLC, has elected not to pursue expansion of its
marketing relationship with Qwest Corp.

"We have recently formed several other partnerships with
telecommunication companies that have demonstrated significant
financial commitment and a desire for long-term partnership that
provides beneficial bundled service for our joint customers," said
Nolan Daines, senior vice president, Alliance Management Group,
the broadband division of EchoStar. "Through these partnerships,
our joint customers are enjoying a single bill, single point of
contact, enhanced customer experience and bundled discounts."

EchoStar will seek to expand relationships with current and future
telecommunication partners that focus on meeting customer demand
for single-bill, bundled services. Customers across the country
have embraced the convenience and cost savings provided through
these successful partnerships.

EchoStar will continue to honor its current, year-old relationship
with Qwest, in which Qwest has agreed to sell DISH Network
satellite TV service to Qwest's customers through the end of the
multi-year contract.

                         About EchoStar

EchoStar Communications Corporation (NASDAQ: DISH) serves more
than 10.1 million satellite TV customers through its DISH Network,
the fastest-growing U.S. provider of advanced digital television
services in the last four years. DISH Network offers hundreds of
video and audio channels, Interactive TV, HDTV, sports and
international programming, together with professional installation
and 24-hour customer service. DISH Network ranks No. 1 in Customer
Satisfaction among Cable/Satellite TV Subscribers by J.D. Power
and Associates. Visit EchoStar's DISH Network at
http://www.dishnetwork.com/or call 800-333-DISH (3474).

At June 30, 2004, EchoStar Communications' balance sheet showed a
$1,739,832,000 stockholders' deficit, compared to a $1,032,524,000
at December 31, 2003.


ENER1 INC: Ability to Continue as a Going Concern is in Doubt
-------------------------------------------------------------
Ener1 Inc., is a Florida corporation founded in 1985. Ener1 was
formerly named Inprimis, Inc., and before that it was named Boca
Research, Inc. During 2002 and 2003, the Company manufactured set-
top boxes and other digital entertainment products through
subcontractors and marketed those products to the hospitality and
healthcare markets through its 49% owned subsidiary EnerLook
Healthcare Solutions, Inc., and to other markets through its
former Digital Media Technologies Division. In 2003, the majority
of the assets in the Digital Media Technologies Division were
transferred to EnerLook.  

The Company's consolidated financial statements have been prepared
on a going concern basis, which contemplates the realization of
assets and the satisfaction of liabilities in the normal course of
business. The Company has experienced net operating losses since
1997 and negative cash flows from operations since 1999, and had
an accumulated deficit of $66.7 million as of June 30, 2004. It is
likely that the Company's operations will continue to incur
negative cash flows through June 30, 2005. Additional financing
will be required to fund the Company's planned operations through
June 30, 2005, and the Company intends to seek additional debt or
equity financing by the first quarter of 2005. If additional
financing is not obtained, such a condition, among others, will
give rise to substantial doubt about the Company's ability to
continue as a going concern for a reasonable period of time.  

Ener1's net sales for the three-month and six-month periods ended
June 30, 2004, were $11,000 and $42,000 respectively. These sales
were made pursuant to a Small Business Innovative Research
contract with the United States Missile Defense Agency. The
Company recorded no sales from continuing operations during the
same periods in 2003.  

During the three month period ended June 30, 2004, Ener1 began
preparing its battery manufacturing plant to begin production, in
addition to continuing research and development activities. A
significant portion of resources previously devoted to battery
research and development and selling, general and administrative
expenses were reallocated to implementing a new manufacturing
infrastructure, including new personnel,
policies and procedures.  

Research and Development Expenses for the three month and six
month periods ended June 30, 2004 increased by 48.2% to $667,000
and by 53.3% to $1,177,000, respectively, when compared to the
same periods in 2003. These increases were due primarily to:
increases in salaries, benefits and outside services related to
the Company's fuel cell segment and its recently formed
nanotechnology subsidiary.  

Selling, General and Administrative Expenses for the three month
and six month periods ended June 30, 2004 increased by 105.3% to
$1,706,000 and 156.8% to $4,166,000, respectively, when compared
to the same periods in 2003. These increases in SG&A were due
primarily to increases in: salaries, wages and benefits;
professional fees; and investor relations expenses. Expenses for
rents, insurance, and general administrative expenses also
increased.  

                 Liquidity and Capital Resources  

As of December 31, 2003 the Company had a working capital deficit
of $7.4 million. During the six months ended June 30, 2004,
working capital increased by $12.7 million, resulting in positive
working capital of $5.3 million as of June 30, 2004. This increase
in working capital was primarily due to an increase in cash and a
decrease in current debt and liabilities, as a result of the sale
and partial use of proceeds to repay debt, in January 2004, of
$20.0 million in aggregate principal amount of the Company's 5%
senior secured convertible debentures due 2009 and the purchase by
ITOCHU Corporation in January, 2004 of 1,500,000 shares of the
Company's common stock for net proceeds of $1,050,000.  

During the six month period ended June 30, 2004, Ener1 expended
$638,000 for capital equipment, of which: $234,000 was for
manufacturing equipment for its battery manufacturing plant;
$111,000 was for administrative equipment, primarily computing
equipment; $120,000 was for research and development equipment;
and $173,000 was for a vehicle.  

Ener1 will require additional capital to support the activities of
Ener1 Battery Company through June 30, 2005 (including the
operations of its Battery and Fuel Cell segments). Funds will also
be required for operations of the Company's new subsidiary,
NanoEner, Inc., which was formed in April 2004 to develop and
market nanotechnologies, nanomaterials and nano-manufacturing
methodologies. The Company intends to seek additional financing by
the first quarter of 2005, which may take the form of equity or
debt. There is no assurance that any such required capital will be
available on terms acceptable to Ener1, if at all.

Ener1 Inc.'s primary lines of business consist of development and
marketing of lithium batteries and certain battery components such
as electrodes; fuel cells, fuel cell systems and components; and
nanotechnology-related manufacturing processes and materials.  


ENERGY VISIONS: Expects $1 Million Loss in Second Quarter
---------------------------------------------------------
Energy Visions, Inc., was unable to timely file current financials
without unreasonable effort or expense due to delays in gathering
the necessary information and due to financial statement
presentation changes to comply with applicable accounting
guidelines.

The Company expects to report revenue of approximately $9,000 in
the quarter ended June 30, 2004. In the comparative period in 2003
Energy Visions reported no revenue. The Company expects to report
a net cumulative loss of approximately $1,056,000 in 2004 as
compared with a loss of approximately $927,000 in 2003. The
principle reason for the increased loss is the reporting of the
Company's equity interest in the results of Pure Energy Inc.,
49.6% owned, a loss of approximately $407,000. There was no
comparative item in the prior year.

The Company's losses from normal operations declined from
approximately $1,022,000 in 2003 to approximately $658,000 in 2004
reflecting lower expenditures in the current year on research and
development activities which decreased approximately 46%, from
approximately $268,000 in 2003 to approximately $146,000 in 2004.
Such reduction includes a recovery of approximately $128,000 upon
the issue in the current quarter of common shares in settlement of
past research and development services debt. Professional fees
also decreased by approximately 65% from approximately $360,000 in
2003, to approximately $125,000 in 2004. The Company incurred only
modest professional fees in the current period, and that period
includes credit adjustments in respect of a fee settlement with
the Company's prior auditors and a lower than anticipated
September 2003 audit fee. The prior period also included a one-
time gain of $95,000 realized upon the sale of options in an
unrelated company. There is no current year equivalent of such
item.

                     About Energy Visions Inc.

EVI develops and commercializes advanced battery and direct
methanol fuel cell technologies and products. EVI possesses
proprietary flowing electrolyte direct methanol fuel cell
technologies that it has been developing for portable power
systems. EVI also owns a major interest in Pure Energy Inc. whose
subsidiary, Pure Energy Visions Inc., manufactures and markets
rechargeable and single-use alkaline batteries globally. These
products are sold under the "Pure Energy", XL(tm) and "Pure Power"
labels and to private label customers worldwide. Pure Energy
products can be purchased at several leading retailers including
Wal-Mart, Radio Shack, London Drugs and Western Grocers. According
to ACNielsen Canada in 2003 Pure Energy sold 51.2% of all consumer
rechargeable batteries and 48% of all chargers sold in Canada at
mass merchandisers (Wal-Mart and Zellers), Grocery Banners and
Toys R Us. According to ACNielsen the number of consumer
rechargeable batteries sold in Canada at these retail channels in
2003 grew by 28% over 2002 figures.

At March 31, 2004, Energy Visions Inc.'s balance sheet showed a
$2,500,390 stockholders' deficit, compared to a $2,884,061 deficit
at September 30, 2003.


FALCON PRODUCTS: Levine Leichtman to Provide $135MM Refinancing
---------------------------------------------------------------
Falcon Products, Inc. (NYSE: FCP), a leading manufacturer of
commercial furniture, has received a commitment letter from Levine
Leichtman Capital Partners. The Los Angeles-based private equity
firm manages in excess of $1 billion in institutional capital, and
is leading a group of investors in a $135 million refinancing of
Falcon's existing credit facility. Terms of the financing will be
disclosed upon completion of the transaction, which is scheduled
on or around September 30, 2004.

"We're pleased to have reached this agreement with Levine
Leichtman Capital Partners. The refinancing will provide us with
significant liquidity and covenant relief, as we continue to
execute our turnaround," Franklin A. Jacobs, Chairman and Chief
Executive Officer stated. "This is a strong partner that is known
for its successful investments. We were also pleased to have
worked with Imperial Capital, the investment bankers who assisted
us in successfully achieving this commitment from Levine Leichtman
Capital Partners."

"Falcon is the leader in the industry and we're excited about the
opportunity to build on their strengths and take advantage of
improving industry fundamentals," stated Arthur E. Levine,
Founding General Partner of Levine Leichtman Capital Partners. "We
anticipate completing this transaction by month end and having a
long-term relationship with Falcon."

Levine Leichtman Capital Partners is a Los Angeles, California
private equity firm that manages in excess of $1 billion in
institutional capital. Founded in 1984, the investment firm makes
structured equity investments in industry leading middle market
companies owned and managed by entrepreneurs. The firm enhances
shareholder value by providing significant post investment
financial assistance to its portfolio companies. Successful
investments by Levine Leichtman Capital Partners include Media
Arts Group Inc., Jon Douglas Real Estate Services Group, Inc.,
Consumer Portfolio Services, Inc., the Quizno's Corporation and
CiCi's Pizza, Inc.

Falcon Products, Inc. is the leader in the commercial furniture
markets it serves, with well-known brands, the largest
manufacturing base and the largest sales force. Falcon and its
subsidiaries design, manufacture and market products for the
hospitality and lodging, food service, office, healthcare and
education segments of the commercial furniture market. Falcon,
headquartered in St. Louis, Missouri, currently operates 8
manufacturing facilities throughout the world and has
approximately 2,100 employees.

                           *     *     *

As reported in the Troubled Company Reporter's March 22, 2004
edition, Standard & Poor's Ratings Services lowered its corporate
credit rating on furniture manufacturer Falcon Products Inc. to
'CCC' from 'B-', and lowered its subordinated debt rating on the
company to 'CC' from 'CCC'. The outlook is negative.

"The downgrade on St. Louis, Missouri-based Falcon Products Inc.
reflects the lower than expected profitability resulting from the
continued softness within the furniture segments the company
serves, as well as the company's breach of certain bank
covenants," said Standard & Poor's credit analyst Martin S.
Kounitz.


FINOVA CAPITAL: Withdraws Request for Thaxton to Produce Documents
------------------------------------------------------------------
As previously reported in the Troubled Company Reporter on Aug. 3,
FINOVA Capital Corporation asked Judge Walsh, the bankruptcy judge
handling The Thaxton Group, Inc.'s Chapter 11 proceedings, to
compel Thaxton to produce documents and other discovery requests
in connection the hearing on substantive consolidation issues
scheduled for September 14 and 15, 2004.

                          Thaxton Objected

Thomas R. Hunt, Esq., at Morris, Nichols, Arsht & Tunnell, in
Wilmington, Delaware, tells the Thaxton Court that most of FINOVA
Capital's request is entirely without merit and was brought about
despite Thaxton's expressed willingness to cooperate to develop a
reasonable discovery schedule. Mr. Hunt notes that since FINOVA
Capital's document request seeks documents related to the Thaxton
Committee's proposal to substantially consolidate all of the
Thaxton entities, the document request should be more
appropriately directed to the Thaxton Committee. Nonetheless,
Thaxton committed to provide documents and information to FINOVA
Capital not otherwise produced by the Committee.

                  FINOVA Withdraws Document Request

Paul N. Heath, Esq., at Richards, Layton & Finger, PA, in  
Wilmington, Delaware, advises the Thaxton Bankruptcy Court that  
FINOVA Capital Corporation withdraws its request to compel  
Thaxton to produce certain documents.

Headquartered in Scottsdale, Arizona, The Finova Group, Inc.,
provides commercial financing to small and midsized businesses;
other services include factoring, accounts receivable management,
and equipment leasing. The firm has three segments: Commercial
Finance, Specialty Finance, and Capital Markets. FINOVA targets
such markets as transportation, wholesaling, communication, health
care, and manufacturing. Loan write-offs had put the firm on shaky
ground. The Company and its debtor-affiliates and subsidiaries
filed for Chapter 11 protection on March 7, 2001 (U.S. Bankr. Del.
01-00697). Daniel J. DeFranceschi, Esq., at Richards, Layton &
Finger, P.A., represents the Debtors. FINOVA has since emerged
from Chapter 11 bankruptcy. Financial giants Berkshire Hathaway
and Leucadia National Corporation (together doing business as
Berkadia) own FINOVA through the almost $6 billion lent to the
commercial finance company. (Finova Bankruptcy News, Issue No. 51;
Bankruptcy Creditors' Service, Inc., 215/945-7000)


FLYI INC: Reports 50.8% Load Factor for August 2004
---------------------------------------------------
FLYi, Inc., (NASDAQ/NM: FLYI) reported preliminary passenger
traffic results for August 2004 for its consolidated Atlantic
Coast Airlines operation, as well as specific results for low-fare
airline Independence Air. Systemwide -- combining the company's
United Express, Delta Connection and Independence Air operations -
the company generated 176.7 million revenue passenger miles
(RPMs), while available seat miles (ASMs) were 348.1 million.  
Load factor was 50.8 percent.  For the month, 516,275 passengers
were carried.

During August 2004, the company's CRJ fleet still was largely in a
transitional mode.  Following the completion of the August 3
flight schedule, the company no longer operated as a United
Express carrier.  The remaining 26 United Express CRJs were taken
out of service at that time to begin the upgrade process of
converting each aircraft to the brand new Independence Air
interior and livery.  The remaining five J-41 turboprops still in
service on August 3 were retired.  Since August was the final
month of the three-month transition out of the United Express
program, comparisons of year-over-year traffic with the previous
Atlantic Coast Airlines operation are no longer meaningful and are
not shown.

During August 2004, Independence Air generated 126.9 million RPMs,
with ASMs of 279.1 million. Load factor for the month was 45.5%,
with 342,674 passengers carried.  The low-fare airline added new
service to 12 markets during August - four August 1, four August
15 and four August 23 - in addition to the 22 destinations
previously launched during June and July, for a total of 34.  One
more new Independence Air market was added in September, three
more are scheduled for October and one more for November.

Independence Air employs approximately 4,700 aviation
professionals.  The Independence Air hub at Washington Dulles is
now the largest low-fare hub in America in terms of total
departures.

                    Consolidated Air Traffic

                                 August 2004   8 months ended
                                                Aug. 31, 2004
                                 -----------   --------------
   Revenue Passenger Miles (000)   176,690          1,902,769
   Available Seat Miles (000)      348,107          2,865,689
   Load Factor (000)                 50.8%              66.4%
   Passengers                      516,275          4,968,486

                    Independence Air Traffic

                                             August 2004
                                             -----------
   Revenue Passenger Miles (000)                 126,851
   Available Seat Miles (000)                    279,067
   Load Factor (000)                               45.5%
   Passengers                                    342,674

                         *     *     *

As reported in the Troubled Company Reporter on August 31, 2004,
Moody's Investors Service placed the debt ratings (Senior Implied
Rating, B3) of FLYi, Inc., and its primary operating subsidiary
Atlantic Coast Airlines, Inc., under review for possible
downgrade. Ratings placed under review:

FLYi, Inc.

   * $125 million of senior unsecured convertible notes: Caa3

Atlantic Coast Airlines, Inc.

   * Senior Implied Rating B3
   * Issuer Rating Caa3
   * Series 1997 Enhanced Equipment Trust Certificates
   * Class A Baa3,
   * Class B B1,
   * Class C B3

The review was prompted by the difficulties the company is
experiencing during the initial stages of its transition from a
fee for service carrier to a fully independent airline including
lower than expected load factors and yields, higher than
anticipated costs associated with the transition, and an earlier
than expected termination of its fee for service contract with
Delta Air Lines, Inc.  The review will focus on the cash flow and
liquidity implications of these factors and the likelihood that
the company's current substantial cash balances will be sufficient
to support operations until a financially stable business base can
be built.

Moody's will assess the ability and the length of time necessary
for the company to increase currently low passenger load factors
at fare levels sufficient to generate a profit.  Moody's notes
that the rapid expansion of capacity at Dulles International
Airport (FLYi's primary hub) has been one of the primary factors
in the under performance of these two metrics.  Also included in
the review will be an assessment of the impact on liquidity of the
earlier than expected termination of the company's contract with
Delta Air Lines, Inc., the cost of conversion of the remainder of
the regional jet fleet to service as Independence Air, and the
costs associated with disposing of aircraft that are or will be
grounded by the company as a result of the cancellation of the
United and Delta contracts.  Moody's anticipates that cash will
decline from current levels ($345 million at the end of June 2004)
if current business pressures and high fuel prices persist.  In
addition, FLYi faces large aircraft lease payments in early 2005.
An expectation that cash flows will be sufficient to enable the
company to maintain adequate liquidity through the seasonally weak
first calendar quarter would be supportive of the current ratings
but any expectations of protracted weak cash flow and eroding
liquidity would result in a downgrade.

Moody's will also review the current values of the aircraft
securing the company's Enhanced Equipment Trust Certificates.  The
aircraft securing these certificates include eight J-41 turboprops
and six CRJ-200ER aircraft.  Should the loan to value associated
with the Class A certificates be determined, in Moody's opinion,
to have deteriorated to a level substantially higher than 50%, a
downgrade of these certificates may be deemed to be warranted.
Junior debt classes will be adjusted accordingly.

FLYi, Inc., and its primary subsidiary, Atlantic Coast Airlines,
Inc., doing business as Independence Air and are headquartered in
Dulles, Virginia.


FLYI INC: Analysts See Opportunities Due to Rivals' Bankruptcies
----------------------------------------------------------------
FLYi, Inc., (NASDAQ/NM: FLYI) is expected to ride on the financial
and business problems of U.S. Airways and United Airlines and grab
more passengers in Washington's Dulles airport, Bloomberg News
reports, citing Barron's as its source.

US Airways filed its first Chapter 11 petition on August 11, 2002.  
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.

As reported in the Troubled Company Reporter on September 13,
2004, 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 after talks with various
labor groups failed.

United Air Lines is also under bankruptcy since December 9, 2002
and is facing pressures from various stakeholders including its
employees.  As reported in the Troubled Company Reporter on
September 1, 2004, flight attendants expressed grave concern over
the continued reckless and incompetent strategies of United
Airlines senior management. Leaders of the Association of Flight
Attendants- CWA, AFL-CIO at United Airlines unanimously passed a
resolution of no confidence in the senior management of United
Airlines and vowed to take all necessary and appropriate legal
steps to seek the failed executives' replacement.

Last month, FLYi had a disappointing 50.8 percent load factor and
carried 516,275 passengers.

                     New Flights Introduced

Translated as a move seizing that opportunity, FLYi introduced new
non-stop service from Washington Dulles International Airport to
both Orlando International Airport and Tampa International Airport
beginning Nov. 3, 2004, with all flights planned to be operated by
the company's brand new 132-passenger Airbus A319 aircraft.

The schedules to Tampa and Orlando will each include three non-
stops from Dulles with 7-day advance purchase sale fares to both
cities as low as $64 one way for tickets purchased at FLYi.com by
Sept. 27, 2004, for travel by Jan. 31, 2005. Full schedules as
well as sale fare details and restrictions are seen below.

Independence Air Chairman and CEO Kerry Skeen said, " [T]he
Independence Air story becomes even more exciting as we begin the
second phase of our mission to bring low fares and enthusiastic
service to many new destinations.  We start with Orlando and Tampa
this fall and will continue as we move forward by adding a total
of 28 Airbus planes over the next 18 months."

The Independence Air Airbus A319s will feature all-leather seating
in a single-class configuration with generous legroom. TV screens
will be available in every seatback by next spring, featuring 24
channels of live satellite programming and a wide selection of
digital music channels.

In addition to the new non-stops from Washington Dulles,
Independence Air will also begin offering non-stop service on
Nov. 3, 2004, aboard our 50-seat jets to both Orlando and Tampa
from six cities: Knoxville, Tenn. (TYS), Greensboro, N.C. (GSO),
Huntsville, Ala. (HSV), Greenville/Spartanburg, S.C. (GSP),
Columbia, S.C. (CAE) and Charleston, S.C. (CHS). The schedule from
each of these six cities will include two daily non-stops to both
Florida destinations, with three non-stops from Knoxville to
Orlando. (Initial service from Knoxville and Columbia to Orlando
begins on October 13 as previously announced).

                         *     *     *

As reported in the Troubled Company Reporter on August 31, 2004,
Moody's Investors Service placed the debt ratings (Senior Implied
Rating, B3) of FLYi, Inc., and its primary operating subsidiary
Atlantic Coast Airlines, Inc., under review for possible
downgrade. Ratings placed under review:

FLYi, Inc.

   * $125 million of senior unsecured convertible notes: Caa3

Atlantic Coast Airlines, Inc.

   * Senior Implied Rating B3
   * Issuer Rating Caa3
   * Series 1997 Enhanced Equipment Trust Certificates
   * Class A Baa3,
   * Class B B1,
   * Class C B3

The review was prompted by the difficulties the company is
experiencing during the initial stages of its transition from a
fee for service carrier to a fully independent airline including
lower than expected load factors and yields, higher than
anticipated costs associated with the transition, and an earlier
than expected termination of its fee for service contract with
Delta Air Lines, Inc.  The review will focus on the cash flow and
liquidity implications of these factors and the likelihood that
the company's current substantial cash balances will be sufficient
to support operations until a financially stable business base can
be built.

Moody's will assess the ability and the length of time necessary
for the company to increase currently low passenger load factors
at fare levels sufficient to generate a profit.  Moody's notes
that the rapid expansion of capacity at Dulles International
Airport (FLYi's primary hub) has been one of the primary factors
in the under performance of these two metrics.  Also included in
the review will be an assessment of the impact on liquidity of the
earlier than expected termination of the company's contract with
Delta Air Lines, Inc., the cost of conversion of the remainder of
the regional jet fleet to service as Independence Air, and the
costs associated with disposing of aircraft that are or will be
grounded by the company as a result of the cancellation of the
United and Delta contracts.  Moody's anticipates that cash will
decline from current levels ($345 million at the end of June 2004)
if current business pressures and high fuel prices persist.  In
addition, FLYi faces large aircraft lease payments in early 2005.
An expectation that cash flows will be sufficient to enable the
company to maintain adequate liquidity through the seasonally weak
first calendar quarter would be supportive of the current ratings
but any expectations of protracted weak cash flow and eroding
liquidity would result in a downgrade.

Moody's will also review the current values of the aircraft
securing the company's Enhanced Equipment Trust Certificates.  The
aircraft securing these certificates include eight J-41 turboprops
and six CRJ-200ER aircraft.  Should the loan to value associated
with the Class A certificates be determined, in Moody's opinion,
to have deteriorated to a level substantially higher than 50%, a
downgrade of these certificates may be deemed to be warranted.
Junior debt classes will be adjusted accordingly.

FLYi, Inc., and its primary subsidiary, Atlantic Coast Airlines,
Inc., doing business as Independence Air and are headquartered in
Dulles, Virginia.


FOSTER WHEELER: Bud Cherry Now Leads Global Power Business
----------------------------------------------------------
Foster Wheeler Ltd. (OTCBB: FWLRF) has consolidated the management
of its two power businesses into one global business under the
leadership of Bud Cherry. The business unit will be known as
Foster Wheeler Global Power Group, and Mr. Cherry is its chief
executive officer. The combined businesses represent the business
group the Company's securities filings have historically referred
to as its Energy Group.

"We have concluded that we and our customers will be best served
by consolidating the leadership of these two businesses," said
Raymond J. Milchovich, chairman, president and CEO of Foster
Wheeler Ltd. "The consolidation provides significant opportunities
for achieving synergy across a wide spectrum of product offerings,
particularly in the strategically important circulating fluidized
bed (CFB) market. Bud's success in strengthening the operational
and financial performance of our North American operations made
him the right person to lead the new business."

"Each of these businesses have people with tremendous talents and
experience," said Mr. Cherry. "I am truly excited about being
offered the opportunity to lead the Global Power Group to success
as the strongest participant in the global market for energy
equipment, aftermarket service, and environmental retrofits."

Key senior executives of Foster Wheeler's Power Group in Europe
will now report directly to Mr. Cherry in his new position. To
further strengthen the team, Chris Holt, formerly the long-time
CFO of Foster Wheeler's U.K.-based subsidiary, has been appointed
as the European Power Group's CFO.

Mr. Cherry joined Foster Wheeler in November 2002 as president and
chief executive officer of Foster Wheeler Power Group, Inc. Since
then, he has also assumed leadership of Foster Wheeler's North
American engineering and construction (E & C) operations based in
Houston.

Prior to joining Foster Wheeler, Mr. Cherry was chief operating
officer of the Oxbow Group where he was responsible for the
company's energy and minerals activities.

                        About the Company      
      
Foster Wheeler, Ltd., is a global company offering, through
its subsidiaries, a broad range of design, engineering,   
construction, manufacturing, project development and management,   
research, plant operation and environmental services.      
      
At June 25, 2004, Foster Wheeler Ltd.'s balance sheet showed an  
$856,601,000 stockholders' deficit, compared to an 872,440,000      
deficit at December 26, 2003.


FOSTER WHEELER: Swap's 60% Minimum Threshold Remains Unmet
----------------------------------------------------------
Foster Wheeler Ltd. (OTCBB: FWLRF) announced today that a minimum
threshold related to its equity-for-debt exchange remains unmet
for one class of securities. Specifically, 57.5% of the revised
minimum threshold of 60% has been tendered by holders of the 9.00%
Preferred Securities. Foster Wheeler is extending its exchange
offer until 5:00 p.m., New York City time, on September 21, 2004.

"Unless the tendered amount of Preferred Securities meets or
exceeds an acceptable minimum threshold, this exchange offer will
fail," said Raymond J. Milchovich, chairman, president and chief
executive officer. "Especially given that we have exceeded the
minimum thresholds regarding every other class of securities
involved in our exchange offer, it would be a shame if all our
stakeholders were forced to suffer because of a small shortfall in
the Preferred Securities."

"We hope that all those who have tendered continue to do so, and
that those still holding Preferred Securities tender them, so that
we can close our offer on Tuesday," continued Mr. Milchovich.

If Foster Wheeler fails to complete the exchange offer, it is then
obligated, subject to certain conditions, to commence and attempt
to consummate the same economic transactions contemplated by the
exchange offer through an alternative implementation structure.
This obligation is contained in the lock-up agreements signed with
various institutional holders of the company's debt securities,
and it is more fully described in the registration statement on
Form S-4 filed with the SEC relating to the proposed exchange
offer. Foster Wheeler continues to actively consider such
alternatives.

                        Legal Details  

The securities proposed to be exchanged are as follows:  

   (1) Foster Wheeler's Common Shares and its Series B Convertible  
       Preferred Shares and warrants to purchase Common Shares for  
       any and all outstanding 9.00% Preferred Securities, Series  
       I issued by FW Preferred Capital Trust I (liquidation  
       amount $25 per trust security) and guaranteed by Foster  
       Wheeler Ltd. and Foster Wheeler LLC, including accrued  
       dividends;  

   (2) Foster Wheeler's Common Shares and Preferred Shares for any  
       and all outstanding 6.50% Convertible Subordinated Notes  
       due 2007 issued by Foster Wheeler Ltd. and guaranteed by  
       Foster Wheeler LLC;  

   (3) Foster Wheeler's Common Shares and Preferred Shares for any  
       and all outstanding Series 1999 C Bonds and Series 1999 D  
       Bonds (as defined in the Second Amended and Restated  
       Mortgage, Security Agreement, and Indenture of Trust dated  
       as of October 15, 1999 from Village of Robbins, Cook  
       County, Illinois, to SunTrust Bank, Central Florida,  
       National Association, as Trustee); and  

   (4) Foster Wheeler's Common Shares and Preferred Shares and up  
       to $150,000,000 of Fixed Rate Senior Secured Notes due 2011  
       of Foster Wheeler LLC guaranteed by Foster Wheeler Ltd. and  
       certain Subsidiary Guarantors for any and all outstanding  
       6.75% Senior Notes due 2005 of Foster Wheeler LLC  
       guaranteed by Foster Wheeler Ltd. and certain Subsidiary  
       Guarantors; and solicitation of consents to proposed  
       amendments to the indenture relating to the 9.00% Junior  
       Subordinated Deferrable Interest Debentures, Series I of  
       Foster Wheeler LLC, the indenture relating to the 6.50%  
       Convertible Subordinated Notes due 2007 and the indenture  
       relating to the 6.75% Senior Notes due 2005.

As of 5:00 p.m. on September 17, 2004, holders have tendered the
following dollar amounts and percentages of the following original
securities:

   (1) 9.00% Preferred Securities, $100,696,725 (57.5%);

   (2) 6.50% Convertible Subordinated Notes, $209,930,000
       (99.97%);

   (3) Robbins Series C Bonds due 2024, $56,643,071 (73.4%),
       Robbins Series C Bonds due 2009, $12,028,197 (99.2%), and
       Robbins Series D Bonds, $35,489,277 based on the balance
       due at maturity (99.1%); and

   (4) 6.75% Senior Notes, $191,118,000 (95.6%).

A copy of the prospectus relating to the New Notes and other     
related documents may be obtained from the information agent:     
     
         Georgeson Shareholder Communications Inc.     
         17 State Street, 10th Floor     
         New York, N.Y. 10014     
     
Georgeson's telephone number for bankers and brokers is     
212-440-9800 and for all other security holders is 800-891-
3214.     
     
Direct any questions regarding the exchange offer and consent     
solicitation to the dealer manager:     
     
         Rothschild Inc.     
         1251 Avenue of the Americas, 51st Floor     
         New York, N.Y. 10020     
         Tel. No. 212-403-3784   
  
Investors and security holders are urged to read the following     
documents filed with the SEC, as amended from time to time,     
relating to the proposed exchange offer because they contain     
important information:   
  
   (1) the registration statement on Form S-4   
       (File No. 333-107054); and   
  
   (2) the Schedule TO (File No. 005-79124).    
  
These and any other documents relating to the proposed exchange   
offer, when they are filed with the SEC, may be obtained free at   
the SEC's Web site at http://www.sec.gov/or from the information    
agent as noted above.     
    
The foregoing reference to the exchange offer and any other     
related transactions shall not constitute an offer to buy or     
exchange securities or constitute the solicitation of an offer  
to sell or exchange any securities in Foster Wheeler Ltd. or any  
of its subsidiaries.

                        About the Company      
      
Foster Wheeler, Ltd., is a global company offering, through
its subsidiaries, a broad range of design, engineering,   
construction, manufacturing, project development and management,   
research, plant operation and environmental services.      
      
At June 25, 2004, Foster Wheeler Ltd.'s balance sheet showed an  
$856,601,000 stockholders' deficit, compared to an 872,440,000      
deficit at December 26, 2003.


FOSTER WHEELER: Declares Recalculated Interest Rate for Sr. Notes
-----------------------------------------------------------------
Foster Wheeler Ltd. (OTCBB:FWLRF) declared the recalculated
interest rate applicable to the Fixed Rate Senior Secured Notes
due 2011, Series A, to be issued by Foster Wheeler LLC in the
equity-for-debt exchange offer that the company launched on
June 11, 2004.

If the exchange offer expires as currently scheduled on Sept. 21,
2004, the New Notes will bear interest at a rate of 10.359% per
annum. This rate is equal to 6.65% plus the yield on U.S. Treasury
notes having a remaining maturity equal to the maturity of the New
Notes determined as of 2:00 p.m., New York City time, on the
second business day prior to the expiration of the exchange offer.
The terms of the New Notes are described in the registration
statement on Form S-4 (File No. 333-107054) relating to the
exchange offer.

The interest rate set forth above supersedes the rates previously
announced.

A copy of the prospectus relating to the New Notes and other     
related documents may be obtained from the information agent:     
     
         Georgeson Shareholder Communications Inc.     
         17 State Street, 10th Floor     
         New York, N.Y. 10014     
     
Georgeson's telephone number for bankers and brokers is     
212-440-9800 and for all other security holders is 800-891-
3214.     
     
Direct any questions regarding the exchange offer and consent     
solicitation to the dealer manager:     
     
         Rothschild Inc.     
         1251 Avenue of the Americas, 51st Floor     
         New York, N.Y. 10020     
         Tel. No. 212-403-3784   
  
Investors and security holders are urged to read the following     
documents filed with the SEC, as amended from time to time,     
relating to the proposed exchange offer because they contain     
important information:   
  
   (1) the registration statement on Form S-4   
       (File No. 333-107054); and   
  
   (2) the Schedule TO (File No. 005-79124).    
  
These and any other documents relating to the proposed exchange   
offer, when they are filed with the SEC, may be obtained free at   
the SEC's Web site at http://www.sec.gov/or from the information    
agent as noted above.     
    
The foregoing reference to the exchange offer and any other     
related transactions shall not constitute an offer to buy or     
exchange securities or constitute the solicitation of an offer  
to sell or exchange any securities in Foster Wheeler Ltd. or any  
of its subsidiaries.

                        About the Company      
      
Foster Wheeler, Ltd., is a global company offering, through
its subsidiaries, a broad range of design, engineering,   
construction, manufacturing, project development and management,   
research, plant operation and environmental services.      
      
At June 25, 2004, Foster Wheeler Ltd.'s balance sheet showed an  
$856,601,000 stockholders' deficit, compared to an 872,440,000      
deficit at December 26, 2003.


GLOBAL CROSSING: Representative Settles 2 Claims Totaling $2.3MM
----------------------------------------------------------------
The Global Crossing Estate Representative has resolved two claims
included in omnibus objections to proofs of claim previously
filed with the Court:

Claimant         Claim No.  Claim Amount   Settlement Terms
--------         ---------  ------------   ----------------
Aerotel, Ltd.         4710    $6,000,000   Aerotel will be deemed
                                           to hold an Allowed
                                           General Unsecured
                                           Claim for $2,000,000,
                                           which claim will be
                                           treated in accordance
                                           with the Plan.

Cendant Mobility      4359       272,683   Cendant will be deemed
Services Corp.                             to hold an Allowed
                                           General Unsecured
                                           Claim for $268,002,
                                           which claim will be
                                           treated in accordance
                                           with the Plan.

Headquartered in Florham Park, New Jersey, Global Crossing Ltd.
-- http://www.globalcrossing.com/-- provides telecommunications  
solutions over the world's first integrated global IP-based
network, which reaches 27 countries and more than 200 major cities
around the globe. Global Crossing serves many of the world's
largest corporations, providing a full range of managed data and
voice products and services. The Company filed for chapter 11
protection on January 28, 2002 (Bankr. S.D.N.Y. Case No. 02-
40188). When the Debtors filed for protection from their
creditors, they listed $25,511,000,000 in total assets and
$15,467,000,000 in total debts.  Global Crossing emerged from
chapter 11 on Dec. 9, 2003. (Global Crossing Bankruptcy News,
Issue No. 66; Bankruptcy Creditors' Service, Inc., 215/945-7000)


GULFTERRA ENERGY: Moody's Affirms Ba2 Senior Implied Rating
-----------------------------------------------------------
Moody's Investors Service affirmed the long-term debt ratings of
Enterprise Products Operating L.P. (Enterprise, Baa3 senior
unsecured) and raised the rating outlook to stable from negative.  
The ratings of GulfTerra Energy Partners, L.P. remain on review
for possible upgrade.  Moody's expects to withdraw GulfTerra's
ratings after completion of its merger with Enterprise Products
Partners L.P. and the completion of Enterprise's tender for
GulfTerra's senior and senior subordinated notes, expected in
September 2004.  Approximately 99.4% of the outstanding GulfTerra
notes have been tendered to Enterprise.

The change in Enterprise's outlook reflects improvement in these
four areas:

   (1) improvement in fundamental operating performance,

   (2) reduction in leverage,

   (3) improved distribution coverage and

   (4) merger integration risk, including GulfTerra debt
       refinancing.

Enterprise's operating performance, as measured by gross margin of
its core operating segments, has improved in the first half of
2004 over the similar 2003 period and has improved in the last
twelve months ended June 30, 2004 compared to full year 2003
results.  Moody's expects that operating performance will continue
to improve in the second half of 2004 and throughout 2005.  This
improvement principally reflects strengthening in the
petrochemical industry, including growing ethylene production and
increased demand for ethane and propane.  We note that while
Enterprise's processing segment second quarter results were
negatively impacted by a $15 million loss in its NGL marketing
business, the company demonstrated benefits from restructuring its
processing contracts, which we expect to contribute to greater
gross margins and lower volatility going forward.

Secondly, Enterprise issued 17.25 million common units in August
for net proceeds of $341 million, following a similar size issue
in April that raised $353 million.  Our stable outlook reflects
Enterprise's commitment to continue reducing its leverage,
including equity issuance from its distribution reinvestment plan
-- DRIP.

Thirdly, Moody's expects Enterprise's distribution coverage to
continue improving through stronger cash flow and from merger
savings as a result of capping the general partner incentive
distribution percentage at 25% in the combined company post-merger
and the elimination of GulfTerra's general partner incentive
distribution percentage of 50%.  The 25% cap, currently in place
at Enterprise, is expected to result in savings of over
$50 million annually compared to the sum of GP distributions
currently at Enterprise and GulfTerra separately.

Finally, while merger integration risks remain at the business
level, the immediate risk of refinancing GulfTerra's debt has been
mitigated by Enterprise closing a $2.25 billion revolving credit
facility and expanding the size of its corporate credit facility
to $750 million. Our stable outlook reflects Enterprise realizing
the diversification and scale benefits of its merger with
GulfTerra, meeting or exceeding its target of $40 million in
synergy cost savings and effective refinancing of its
$2.25 billion bridge facility in the capital markets.

Enterprise's Baa3 rating reflects the company's strong integrated
natural gas and NGL assets, its predominantly fee-based and
margin-band contract structure, and the impending GulfTerra
merger, which should provide additional scale, complementary
assets and commodity price risk diversification.  Enterprise's
rating also considers the volatility of the company's cash flow
that is higher than most other MLPs, Enterprise's current leverage
and the leverage of the combined company post-merger, management's
ability to maintain distribution and capital spending discipline
that is consistent with the company's risk profile and cash flow
volatility, and merger integration risks including realization of
operating and cost saving synergies.  Given the rating downgrade
in May 2004 and the need for ongoing demonstration of fundamental
operating performance improvement, a ratings upgrade in the near
to medium term is unlikely.  Enterprise's ratings would come under
negative pressure from deterioration in the company's operating
results, lack of significant progress in leverage reduction, weak
distribution coverage, and poor merger integration results.

These Enterprise ratings were affected:

   * Baa3 senior unsecured notes and bank debt; and
   * shelf registration for senior unsecured securities (P)Baa3.

These GulfTerra ratings were affected:

   * Ba2 senior implied rating,
   * Ba3 issuer rating and senior unsecured rating, and
   * B1 senior subordinated rating.

Enterprise Products Operating L.P., headquartered in Houston,
Texas, is the primary operating subsidiary of Enterprise Products
Partners L.P. a midstream MLP energy company. The MLP has
operations in the transportation, storage and processing of
natural gas; the fractionation, transportation, storage and
marketing of NGLs and propylene; and the production of MTBE.  The
assets of the MLP are held in Enterprise Products Operating L.P.


HARVEST NATURAL: S&P Raises Senior Implied Rating to B3 from Caa1
-----------------------------------------------------------------
Moody's upgraded the senior implied rating for Harvest Natural
Resources, Inc., to B3 from Caa1.  Moody's also upgraded and
removed the notching of the 9.375% senior notes from the senior
implied rating, adjusting the rating to B3 from Caa2.  The outlook
is stable.  

The upgrade follows Moody's upgrade of both Venezuela and PDVSA,
the national oil company of Venezuela, both of which were
downgraded last year pending a resolution to the political
instability in the country, which, however, appears to have
occurred with the recall referendum completed in August.  While
Moody's felt that fundamentally Harvest's operations and liquidity
were in line with higher ratings at the time, the company's
dependency on sales to PDVSA for all of its operating cash flows
and with all of its reserves and production located in Venezuela
resulted in ratings more in line with Moody's ratings for both
PDVSA and Venezuela during this period of uncertainty.

The upgrade and removal of the notching of the notes rating
reflects the company's cash balances, which at almost
$160 million, is approximately twice the amount of the notes and
currently leaving the company with zero net debt as well as
management's announcement that it will use the cash to redeem the
remaining $85 million of 9.375% senior notes on Nov. 1, 2004.   
Though the notes are not guaranteed by Harvest's subsidiaries,
under the indenture, Harvest must either reinvest the proceeds
from the sale of its Geoilbent interest (Harvest received
approximately $75 million) in similar type assets or offer to
redeem a like amount of notes at par within a year.  As a result,
Harvest announced it will irrevocably deposit the full redemption
amount with the trustee this month to call the notes and gives
Moody's cause to remove the notching.

Moody's estimates the redemption will cost approximately
$87 million, leaving the company with nearly $70 million of cash,
while eliminating about $8 million of annual interest expense and
all but approximately $15 million of total debt.  According to
management, future financings will likely take place closer to the
assets and be done out of Venezuela through the Harvest Vinccler,
C.A. joint venture.

Harvest's ratings are restrained by:

     (i) its concentration of cash flows, which come entirely from
         production sold to PDVSA and the attendant significant
         political risk of Venezuela;

    (ii) current oil production still below pre strike levels
         despite workovers to enhance production;

   (iii) high full cycle costs compared to realized prices which
         limits Harvest's ability to internally fund reserve
         replacement; and

    (iv) a significant amount of proved undeveloped -- PUD --
         reserves relative to total reserves that will require
         significant future spending to convert to producing
         reserves.

The ratings are supported by:

     (i) significant cash balances; reduction of leverage, which
         will almost be negligible upon the senior notes
         redemption;

    (ii) the commencement of new natural gas production that came
         on-line in November 2003 that has increased total
         production for the company;

   (iii) lower interest expense which offsets some of the higher
         components of unit costs and will further improve after
         the notes are called; and

    (iv) operating control in Venezuela.

The ratings for Harvest are:

   * Upgraded to B3 from Caa2 -- Harvest's 9.375% senior unsecured
     notes due 2007;

   * Upgraded to B3 from Caa1 -- Harvest's senior implied rating;
     and

   * Upgraded to Caa1 from Caa2 -- Harvest's senior unsecured
     issuer rating.

The ratings continue to reflect the concentration of the company's
cash flows and the political risk associated with operating in
Venezuela.  Harvest conducts its primary production operations
through its 80%-owned Venezuelan subsidiary, Harvest Vinccler,
C.A., which possesses a 20-year operating service agreement on
mature producing oil reserves with PDVSA that expires in 2012.  
However, this is the sole source of cash flow for Harvest, and as
evidenced during the oil workers strike, is subject to significant
political risk.

In September 2003, Harvest exited the Russian market (at least
temporarily) when it sold its interest in oil and gas reserves in
Russia, through its 34%, non-operating ownership of Geoilbent Ltd,
a Russian limited liability company with production and reserves
in West Siberia.  However, the company has indicated that it will
continue to review new opportunities in Russia, which in Moody's
view could raise the risk profile of the company.

The ratings also consider that post strike oil production levels
have not been fully restored as some of the wells were affected by
the strike related shut-in.  From the end of the strike through
6/30/04, the company has spent nearly $6 million on workovers to
enhance oil production from the affected wells, however, oil
production is still approximately 5,000 to 6,000 barrels/day below
pre strike levels.  Though some of this decline is attributable to
the natural decline curve and has been offset by the new natural
gas production, some production was affected by the strike related
shut-in.

Also restraining Harvest's ratings is its relatively low cash on
cash returns.  At June 30, 2004, Harvest's full cycle costs per
boe of production were $11.60/boe, which includes the company's
3-year all sources finding and development costs.  Given the low
realizations (approximately 45-55% of WTI) of its heavy grade oil
and location and transportation costs, Harvest is only covering
its full cycle costs including its 3-year average finding and
development costs, at just over 1.0x.  Moody's notes that
Harvest's costs have improved with addition of the natural gas
production, which the company realized synergies with its existing
infrastructure, and will further benefit from the reduction of
interest expense upon retirement of the senior notes.  However,
these costs are still high relative to realized prices for its
production and therefore, limits the ability to internally fund
reserve replacement when commodity prices are lower.

The ratings also consider the high percentage of PUD reserves,
which at 12/31/03 was approximately 43% and the associated
$104 million of future capital required to convert these reserves
to the producing stage.

The ratings gain support from Harvest's significant financial
flexibility resulting from cash balances of approximately
$160 million that will fund the full redemption of the company's
senior notes and leave the company with approximately $70 million
of unrestricted cash compared to approximately $15 million of debt
at the HVCA level.

The ratings are also supported by Harvest's low leverage as
measured by debt/proved developed -- PD -- reserves, which the
company has successfully improved from a peak of $5.44/boe for the
quarter ended Dec. 31, 2001 to $1.97/boe at June 20, 2004.  Upon
the redemption of the notes, the company's debt/PD reserves will
decline to about $0.30/boe and will continue to benefit from the
amortization of a $15.5 million loan at B-V for the construction
of a gas pipeline and facility related to the natural gas
production agreement with PDVSA.  The loan requires quarterly
payments of $1.3 million and will be down to approximately
$10.3 million by year-end 2004, which barring any new borrowings
by Harvest, will be essentially the total debt of the company.

Harvest begun delivering natural gas to PDVSA in November 2003.  
While the contracted price for the gas is fixed at $1.03 per mcf
and calls for 4.5 million barrels of oil at a fixed price of only
$7/barrel which is about half of the company's realized price for
the rest of the oil production, the company's total production has
increased and has provided the company with cost savings and has
resulted in a declining lease operating expense and the company
being able to cover its cash expenses.

Harvest Natural Resources, Inc., headquartered in Houston, Texas,
is an independent energy company engaged in the exploration,
development and production of oil and gas in Venezuela.


HEADWATERS INC: Changes Names of Three Major Operating Divisions
----------------------------------------------------------------
Headwaters Incorporated (NASDAQ: HDWR) is changing the names of
three of its main operating divisions to better unify corporate
identity.

Headwaters Energy Services will be the new name of Covol Fuels,
reflecting the company's growing portfolio of technologies and
services for the electric power and energy industries. Energy
Services is the leading provider of technology and chemical
reagents for the coal-based synthetic fuel industry and has begun
the development and commercialization of new coal cleaning and
ammonia slip mitigation technologies.

Headwaters Resources will be the new name of ISG Resources,
America's largest manager and marketer of coal combustion
products, which was acquired by Headwaters in September 2002.
Resources manages approximately 20 million tons of coal combustion
products annually for many of the nation's largest coal-fueled
electric utilities.

Headwaters Construction Materials will be the new name of American
Construction Materials -- the Headwaters division that is
comprised of several building products manufacturing companies and
product brands.

Together with the previously named Headwaters Technology
Innovation Group, these four divisions comprise the backbone of
Headwaters Incorporated's organization. Headwaters Technology
Innovation focuses on development and commercialization of
technologies for nanocatalyst creation, heavy oil upgrading, and
coal liquefaction and gasification.

The company's product-oriented brand names -- such as Tapco,
Eldorado Stone, Southwest Concrete, Palestine Block, Magna Wall
stucco, and BEST Masonry, among others -- will be unaffected by
the change.

"We anticipate no disruption to product marketing within the
Headwaters family of companies, but renaming our top-line business
units will help us clarify our corporate identity," said Kirk
Benson, chairman and CEO. "Over the past several years, we have
successfully acquired a number of leading product brands that will
continue in their respective markets. Positioning these brands
under a common Headwaters umbrella will help us build recognition
of our company as we continue to evolve and grow."

                  About Headwaters Incorporated

Headwaters Incorporated is a world leader in creating value
through innovative advancements in the utilization of natural
resources. The company is focused on providing services to energy
companies, conversion of fossil fuels into alternative energy
products, and adding value to energy. Headwaters generates revenue
from managing coal combustion products (CCPs) and from licensing
its innovative chemical technology to produce an alternative fuel.
Through its CCP business, building products business, and its
solid alternative fuels business, the company earns a growing
revenue stream that provides the capital needed to expand and
acquire synergistic new business opportunities.

                          *     *     *

As reported in the Troubled Company Reporter on Sept. 15, 2004,
Moody's Investors Service assigned a B1 rating to Headwaters
Incorporated's senior secured credit facilities, a B3 rating to
its second lien term loan, and a B1 senior implied rating.
Headwaters is using the term loans under the credit facilities to
finance the $715 million acquisition of Tapco Holdings, Inc., a
manufacturer of building products and professional tools used in
exterior residential remodeling and construction projects.  Tapco
reported EBITDA of $63 million in its fiscal year ended October
31, 2003, and is targeting EBITDA of $82 million this year.  The
rating outlook is stable.

Moody's assigned the following ratings to Headwaters:

     (i) B1 rating to its guaranteed senior secured (first lien)
         credit facilities, which consist of a $75 million five-
         year revolving credit facility and a $640 million term
         loan B facility maturing April 30, 2011,

    (ii) B3 rating to the $150 million guaranteed second lien
         eight-year term loan,

   (iii) B1 senior implied rating, and

    (iv) Caa1 senior unsecured issuer rating.

Moody's ratings for Headwaters exclude, almost entirely, cash flow
derived from the company's Covol Fuels synfuels-based business
unit due to the uncertainty associated with Section 29 tax credits
and their scheduled expiry after 2007.  Therefore, Moody's ratings
are based on the ability of Headwaters' other businesses to
service its pro forma $972 million of debt.  In fiscal 2004 (the
year ending September 30), these other businesses are expected to
account for approximately two-thirds of Headwaters' pro forma
EBITDA, or roughly $140 million, which should be adequate to cover
interest, capex, and small amounts of debt reduction.

Headwaters' ratings reflect its:

   * high leverage,

   * relatively few tangible assets (approximately $300 million),

   * the challenges of integrating and managing the growth
     potential of the many diverse businesses that the company has
     acquired since September 2002, and

   * the possibility for further acquisitions.

More specifically, Moody's ratings also consider:

   * a high degree of customer concentration at the ISG operations
     and Tapco,

   * exposure to cyclical and seasonal construction markets, and

   * coal combustion product -- CCP -- transportation cost
     pressures due to high fuel costs.

However, the ratings are supported by the organic growth potential
and strong market positions held by ISG and Tapco, the stability
of the construction markets they serve, and these businesses'
modest capex requirements.  Earnings stability is enhanced by
ISG's long-term CCP management contracts and by Tapco's low-cost
manufacturing capabilities, leading market share for vinyl
shutters, and the breadth of its offerings of exterior residential
building products.  While there are likely to be some synergies
between ISG, Tapco, and some of the concrete-based construction
materials companies that Headwaters' has recently acquired (such
as Eldorado Stone and Southwest Concrete Products), Moody's also
takes comfort in the fact that each of these businesses can be run
independently.

The stable rating outlook reflects:

   * favorable demand prospects for Headwaters' businesses (again,
     excluding Covol Fuels),

   * the ability of ISG and Tapco to grow with relatively minor
     fixed asset and working capital investments and, therefore,
     facilitate debt reduction, and

   * Headwaters' reasonably good liquidity, which is comprised of
     a $75 million revolving credit facility and $35 million of
     cash.

The ratings could be upgraded if debt is reduced to a level
whereby cash flow from all sources other than Covol Fuels
indicates sustainable leverage of less than approximately 4x
EBITDA or retained cash flow to debt of 15-20% and the earnings
power of Headwaters' other businesses remain favorable.  If
current business plans for Covol Fuels continue without
disruption, Headwaters could generate nearly an additional
$100 million per year of cash through 2007, which if applied fully
to debt reduction would accelerate debt reduction and Headwaters'
upgrade potential.

Headwaters' ratings or rating outlook could be pressured downward
by:

   * sizable debt-funded acquisitions,

   * the reduction of trend growth,

   * margins or cash flow from Headwaters' ISG and construction
     materials segments,

   * integration problems,

   * adverse regulatory changes regarding the use and disposal of
     CCPs, and

   * the emergence of material losses or lawsuits related to Covol
     Fuels, which has otherwise been excluded from Moody's
     ratings.

The B1 rating for Headwaters' first lien credit facilities
reflects their first priority lien and security interest in all of
the company's assets and stock of the borrower and guarantors, and
the dominant role of this class of debt in Headwaters'
capitalization.

The second lien term loan was rated B3, two notches below the
first lien debt, to reflect:

   * the modest proportion of loss-absorbing equity in the pro
     forma capital structure,

   * the second priority secured position of the term loan, which
     ranks behind at least $640 million of outstanding first lien
     debt (and $715 million of commitments), and

   * the limited value, approximately $300 million, of the
     tangible assets supporting Headwaters' secured credit
     facilities.

The senior unsecured issuer rating of Caa1 reflects the absence of
security and subsidiary guarantees for this class of debt.


HENRY CO: Moody's Affirms B3 & Junk Ratings & Says Outlook Stable
-----------------------------------------------------------------
Moody's Investors Service changed the ratings outlook on Henry
Company to stable from negative while affirming the company's
existing ratings of B3 senior implied, Caa1 on the senior notes,
and Caa2 issuer.

The change in the ratings outlook reflects Henry's success in
finally integrating Monsey Bakor, which was acquired in 1998, and
the improvement in the company's operating performance in 2003 and
thus far in 2004, which Moody's expects to continue.

The ratings incorporate Henry's:

   * leveraged balance sheet,

   * negative net worth,

   * sales concentration to Home Depot, and

   * fluctuations in weather and raw material prices, particularly
     oil and steel prices.

In addition, the ratings incorporate the company's potential
exposure to asbestos settlement costs, which to date have not cost
the company anything.

At the same time, the ratings consider Henry's:

   * strong industry positions,
   * established brand names and reputation,
   * long history,
   * multiple distribution channels, and
   * national coverage.

In addition, the company's key financial ratios now compare
favorably with those of other B3 rated building products
companies.

The ratings confirmed are:

   -- B3 senior implied rating;

   -- Caa1 on $58.785 million (remaining balance) of 10% senior
      notes due 4/15/2008; and

   -- Caa2 issuer rating.

The senior notes, originally sized at $85 million, benefit from
the upstream guaranties of Henry's domestic operating
subsidiaries.

After several years of difficulty with the integration of Monsey
Bakor, Henry appointed new senior management and instituted
restructuring initiatives in 2001, the significant benefits of
which began to be felt in 2003.  EBIT coverage of interest
expense, which was an unsatisfactory 0.3x in 2001, rose to 1.9x
both for 2003 and for the trailing twelve months ended
June 30, 2004.  Total debt/EBITDA, which was an unhealthy 11.2x in
2001, was sharply reduced to 3.5x for 2003 and to 4.1x for the
trailing twelve months ended June 30, 2004 (with the latter period
including a seasonal buildup of working capital and short-term
debt).  Moody's expects this improvement to continue.  However,
the company still has negative book net worth of $23 million.

As a result of the loss of the Lowe's business and the exclusive
arranged with Home Depot, Henry's sales concentration to Home
Depot has grown to about 25%.  The good news is that Home Depot
carries the premium Henry brand while Lowe's, which dropped Henry
as a supplier, carried primarily a Henry economy product.  In
addition, the company reports that Home Depot sells through more
Henry product per store than Lowe's had previously done.  The
potential for bad news is that Home Depot periodically conducts
line reviews (Henry's current agreement with Home Depot lasts into
2005), and if it should displace Henry as a supplier, this could
have a material adverse effect on the company's ongoing financial
health.

Unlike homebuilders, which benefit from dry, mild winter weather,
Henry receives a boost from harsh, wet winter weather.  The dry
winter in the West in 2003 and 2004 kept overall first quarter
2004 revenues essentially flat.  In addition, the company is
exposed to fluctuations in oil prices, which are translated into
changing asphalt costs, and in steel prices, which are used in
drums and pails that hold its finished product.  Although the
company has been raising its prices this year to try to offset its
asphalt and steel cost increases, it frequently experiences a lag
in the implementation period (for its price increases), thereby
pressuring margins.

The company has for many years used chrysotile asbestos in its
production process in accordance with OSHA regulations, EPA
exemption, and customer acceptance.  These asbestos fibers were
mixed into and fully encapsulated by the asphalt used in
production of Henry's products.  Because of the unavailability of
asbestos in late 2002 and early 2003, Henry switched to alternate,
higher-cost raw materials to maintain production.  Even though
asbestos is again currently available, the company decided to
cease usage of any asbestos in its production process as of
September 1, 2004.  Henry has been named as a defendant in several
hundred suits alleging certain asbestos-related injuries.  To
date, the company has not incurred any expense in judgment or
settlement of any such suit, nor has it experienced any workers'
compensation claims related to asbestos exposure despite having
used asbestos in the production process since the 1930's.  The
company believes that its insurance, which has fully covered all
litigation related costs to date, is sufficient to cover future
costs.  However, the company is not covered by insurance for
asbestos-related claims pertaining to injuries that are alleged to
have arisen after December 1, 1985.  With respect to the several
hundred suits filed against it to date, the company is not aware
of any cases claiming exposure after December 1, 1985.  Given the
company's small size, a major settlement against it for exposure
after 1985 or multiple settlements against it for pre-12/85
exposure that exhausted its insurance coverage would have a
material adverse effect on the company's financial viability.

Headquartered in Huntington Park, California, Henry Company is a
building products company focusing primarily on products for
roofing, sealing, and paving applications.  Sales and EBITDA for
the trailing twelve-month period ended June 30, 2004 were
$228.5 million and $20.8 million, respectively.


I-70 PRODUCTIONS: Case Summary & 20 Largest Unsecured Creditors
---------------------------------------------------------------
Debtor: I-70 Productions, Inc.
        P.O. Box 85
        Emma, Missouri 65327

Bankruptcy Case No.: 04-45724

Type of Business: The Debtor is engaged in rodeo production and
                  livestock sales.

Chapter 11 Petition Date: September 17, 2004

Court: Western District of Missouri (Kansas City)

Judge: Dennis R. Dow

Debtor's Counsel: John B. Neher, Esq.
                  109 South 10th Street
                  P.O. Box 248
                  Lexington, MO 64067
                  Tel: 660-259-6166
                  Fax: 660-259-6632

Total Assets: $1,953,300

Total Debts:  $1,688,444

Debtor's 20 Largest Unsecured Creditors:

Entity                        Nature Of Claim       Claim Amount
------                        ---------------       ------------
Concordia Bank                18 Acres located        $1,400,000
P.O. Box 909                  at 100 Locus Ave.
Concordia, MO 64020-0909      secured value:
                              $1,875,000

W & M Welding                 Services                  $130,000

Robert J. Plisky              Loan                       $40,000

Progressive Insurance         Trade debt                 $24,000
Department 0594

M & S Livestock and           Charges                    $16,000
Equipment

Rick Coyer Construction       Services rendered          $15,000

Greg Hall                     Loan                       $12,000

Kansas Power and Light        Charges                    $12,000

Professional Rodeo            Charges                     $6,900

Joyce F. Meyers CPA           Services rendered           $4,900

Susquahanna Investments Inc.  Loan                        $3,750

Emma Municipal Water          Charges                     $3,500

MFA Oil and Propane           Charges                     $3,300

David Neth                    Services rendered           $2,700

Centurytel                    Charges                     $2,600

True Value                    Charges                     $2,255

KMMO Radio                    Charges                     $1,977

Dunning Feed                  Charges                     $1,488

Testing and Monitoring        Services rendered           $1,300
Services

Green Printers                Charges                       $800


IASIS HEALTHCARE: Revises Third Quarter 2004 Earnings Release
-------------------------------------------------------------
IASIS Healthcare(R) LLC has revised the presentation of the
statements of operations and cash flows of IASIS LLC and its
predecessor, IASIS Healthcare Corporation, for the three and nine
months ended June 30, 2004.

This change in presentation does not alter the results of
operations, including adjusted EBITDA and net earnings, of IASIS
LLC and IASIS on a combined basis. The loss on early
extinguishment of debt of $51.9 million incurred in connection
with the acquisition of IASIS, previously reported as an expense
of IASIS LLC for the period from June 23, 2004 to June 30, 2004,
is now reflected as an expense of IASIS for the period from
April 1, 2004 through June 22, 2004.

The change in presentation includes a corresponding $51.9 million
increase in unallocated purchase price and member's equity at June
30, 2004. In addition, IASIS LLC has increased its unallocated
purchase price of IASIS by $12.6 million reflecting the reduction
of the predecessor's net equity carrying value for merger-related
expenses. The preliminary purchase price allocation, including
unallocated purchase price, is subject to IASIS LLC's obtaining a
final valuation prepared by an independent appraiser.

IASIS LLC, located in Franklin, Tennessee, is a leading owner and
operator of medium-sized acute care hospitals in high-growth urban
and suburban markets. The Company operates its hospitals with a
strong community focus by offering and developing healthcare
services targeted to the needs of the markets it serves, promoting
strong relationships with physicians and working with local
managed care plans. IASIS LLC owns or leases 15 acute care
hospitals and one behavioral heath hospital with a total of 2,257
beds in service and has total annual net revenue of approximately
$1.3 billion. These hospitals are located in five regions: Salt
Lake City, UT; Phoenix, AZ; Tampa-St. Petersburg, FL; Las Vegas,
NV; and four cities in Texas, including San Antonio. IASIS LLC
also has ownership interests in three ambulatory surgery centers
and owns and operates a Medicaid managed health plan in Phoenix
that serves over 93,000 members. For more information on IASIS
LLC, please visit the Company's website at
http://www.iasishealthcare.com/

                           *     *     *

As reported in the Troubled Company Reporter on May 31, 2004,
Standard & Poor's Ratings Services assigned its 'B+' rating and
its recovery rating of '3' to IASIS Healthcare LLC's proposed new
senior secured bank credit facility.

IASIS Healthcare LLC is a wholly-owned subsidiary of IASIS
Healthcare Corp. The facility is rated the same as the company's
corporate credit rating; this and the '3' recovery rating mean
that lenders are unlikely to realize full recovery of principal in
the event of a bankruptcy, though meaningful recovery is likely
(50%-80%).

At the same time, Standard & Poor's assigned its 'B-' rating to
$475 million senior subordinated notes that are obligations of
both IASIS Healthcare LLC, and IASIS Capital Corp. as co-
borrowers.

In addition, Standard & Poor's affirmed its 'B+' corporate credit
rating on hospital operator IASIS Healthcare Corp., and removed it
from CreditWatch where it was placed on May 5, 2004, following the
announcement of the proposed acquisition of the company for $1.4
billion by the private equity firm, Texas Pacific Group. As of
March 31, 2004, Franklin, Tenn.-based IASIS total debt outstanding
was $663 million.

"The outlook is negative, reflecting the potential for a lower
rating if the company does not achieve its intended reduction in
debt leverage, as this transaction adds about $250 million of
debt, and if the company's business policies become more
aggressive under new management," said Standard & Poor's credit
analyst David Peknay.


INTEGRATED HEALTH: Tort Claimants Want Payment Under IHS Plan
-------------------------------------------------------------
Before the Petition Date, Dorothy Hileman, Tomas Jimenez-Garcia,
Dorothy Custer, Geraldine Escobar, and Jewel Brown, sustained
injuries as a result of the Integrated Health Services, Inc.
Debtors' negligence and other tort-related claims, including but
not necessarily limited to during the year 1999.

Kevin J. Mangan, Esq., at Monzack and Monaco, P.A., in
Wilmington, Delaware, relates that under the Plan, the Tort
Claimants' claims became Allowed 1999 Insured Tort Claims, as all
their claims have been reduced to settlement.

The Plan classifies the 1999 Tort Claimants as Class 8 creditors.  
The Plan provides that the 1999 Tort Claimants will receive their
Pro Rata Share of the total sum of the Available 1999 Insurance
Proceeds and 3% of the difference between the 1999 Insurance
Proceeds and the total amount of the allowed 1999 Insured Tort
Claims.  The IHS Debtors were required to deposit cash in escrow
in the amount equal to 3% of the 1999 unpaid deductible amount
plus any available 1999 Insurance Proceeds due and owing by the
IHS Debtors' insurance carriers with respect to the 1999 Tort
Claimants.

With respect to the Available 1999 Insurance Proceeds, the Plan
provides that the 1999 Tort Claimants will share in any available
coverage under the IHS Debtors' 1999 matching deductible
professional and general insurance policy issued by Reliance
Insurance Company, as provided in the Plan.  The 1999 Tort
Claimants are deemed to have assigned their rights in a claim
filed under the Reliance Policy in the liquidating proceedings
pending with respect to Reliance.

The first distribution owed to the 1999 Tort Claimants is a cash
payment equal to 50% of the Allowed Claim.  Eureka Capital
Markets, as the Liquidating Manager of IHS Liquidating, is
authorized to make the distributions.

                    1999 Tort Claimants' Plight

Mr. Mangan tells Judge Walrath that the 1999 Tort Claimants or
their family members suffered substantial and devastating injuries
resulting many times in death because they or their families
entrusted their well being to the IHS Debtors.  "[A]t the time
when the elderly were most in need, they were abused, mistreated
and neglected."

The Claimants and their family members have long ago lost any
confidence and trust they ever may have held in the IHS Debtors.  
Making matters worse, the 1999 Tort Claimants believe that they
will never be paid the full value of their claim.

Now, the Tort Claimants are expected to assume that the IHS
Debtors, through IHS Liquidating and Eureka, are taking the
necessary steps to collect and eventually disburse the funds to
them.

                       Distribution Status

Over the course of a number of months, the 1999 Tort Claimants
attempted to determine the expected date of the Initial Class 8
Distribution Date.  Communications with the IHS Debtors provided
vague and inconsistent information on Eureka's duties, when
distributions were to be made, and the reasons for the delay in
the distributions.

According to Mr. Mangan, there are no concrete documents or
statements are available for the 1999 Tort Claimants to review to
track:

   (1) the status of the funds available to make the 50% initial
       distributions to the 1999 Tort Claimants;

   (2) the actions taken by Eureka;

   (3) the reasons for any delay; and

   (4) what the IHS Debtors, IHS Liquidating, or Eureka have done
       to rectify the cause of the delays.

Without an accounting and status report, the 1999 Tort Claimants
are left in a knowledge void as to the status of their claims.

Mr. Mangan notes that the 1999 Tort Claimants' communications with
the IHS Debtors and others over the past months on the purported
progress towards distribution reveal many general reasons for the
delay, including:

   -- litigation with Reliance;

   -- failure of the excess insurer to disburse funds; and

   -- calculation of the claims.

Early this year, the Debtors' counsel advised Camille J. Iurillo,
Esq., attorney for Ms. Hileman and Mr. Jimenez-Garcia in St.
Petersburg, Florida, that an escrow fund had been established for
the excess carriers to place funds in as claims were settled.  
Funds previously received from Reliance were also deposited in
that escrow account.  The Debtors' counsel recommended that the
1999 Tort Claimants contact Eureka to be advised of the status and
expected date of distributions from IHS Liquidating.

Ms. Iurillo did as told.  Andrew Smith of Eureka, however, stated
that his company knew nothing about when claims would be paid for
the 1999 Tort Claimants.  Mr. Smith further advised that he didn't
think the 1999 Tort Claimants were receiving any money.  Mr. Smith
also stated that Eureka was not responsible for the distribution
process.

"Eureka's representation is quite shocking in light of the fact
that pursuant to the Plan, a liquidating LLC was formed to
liquidate, collect and maximize certain assets and to make
distributions in respect of certain claims, including the 1999
Claimants' claims," Mr. Mangan says.  "Eureka was appointed the
Liquidating Manager to accomplish these obligations."

Mr. Mangan also points out that the Liquidating LLC Plan
Administration Agreement provides that Eureka is paid $1.2 million
a year to accomplish its duties.

Ms. Iurillo again contacted the Debtors' counsel, who advised
that, contrary to Mr. Smith's representation, Eureka was
responsible for the distributions.

To end this "run around," the 1999 Tort Claimants ask the Court to
compel IHS Liquidating and Eureka to make initial distributions to
the Class 8 1999 Tort Claims pursuant to the Plan.  In the
alternative, the 1999 Tort Claimants want IHS Liquidating and
Eureka to provide an accounting and status report concerning the
distributions owed to the 1999 Tort Claimants.

Headquartered in Owings Mills, Maryland, Integrated Health
Services, Inc. -- http://www.ihs-inc.com/-- IHS operates local  
and regional networks that provide post-acute care from 1,500
locations in 47 states. The Company filed for chapter 11
protection on February 2, 2000 (Bankr. Del. Case No. 00-00389).
Michael J. Crames, Esq., Arthur Steinberg, Esq., and Mark D.
Rosenberg, Esq., at Kaye, Scholer, Fierman, Hays & Handler, LLP,
represent the Debtors in their restructuring efforts.  On
September 30, 1999, the Debtors listed $3,595,614,000 in
consolidated assets and $4,123,876,000 in consolidated debts.
(Integrated Health Bankruptcy News, Issue No. 81; Bankruptcy
Creditors' Service, Inc., 215/945-7000)


INTERPOOL INC: Paying Cash Dividend to Common Stockholders
----------------------------------------------------------
Interpool, Inc. (IPLI.PK) will pay a cash dividend of $.0625 cents
per share for the third quarter of 2004. The dividend will be
payable on October 15, 2004 to shareholders of record on Oct. 1,
2004. The aggregate amount of the dividend is expected to be
approximately $1,700,000. The amount of the quarterly dividend is
based on an indicated annualized dividend rate of 25 cents per
share.

Tracing its roots to 1968 and based in Princeton, New Jersey,
Interpool, Inc., through its subsidiaries, is the largest lessor
of domestic chassis and, in combination with 50% owned subsidiary
Container Applications International, is among the largest lessors
of marine containers in the world.

                           *     *     *

As reported in the Troubled Company Reporter on Sept. 17, 2004,
Fitch Ratings has assigned a 'B' rating to Interpool, Inc.'s
6% $150 million unsecured notes due 2014. As part of the offering,
note investors have also been issued warrants for approximately
8.3 million shares of common stock exercisable at $18 per share.
Interpool's Rating Outlook was revised to Positive from Negative
on July 9, 2004. Fitch also rates Interpool's senior secured debt
and preferred stock 'BB-' and 'CCC+', respectively.

Fitch views Interpool's successful issuance of unsecured debt as
continued positive momentum in the company's recovery from its
financial management and operational challenges in 2003.
Additional long-term unsecured capital will benefit the company's
capital structure and help to provide additional financial
flexibility. This offering is a component of a strategy that,
over the long term, should simplify Interpool's capital structure
and provide additional liquidity resources.

Additional positives include the ongoing implementation of a new
accounting and information technology infrastructure, which will
likely significantly enhance the company's operational integrity.
Interpool has also made significant progress towards returning to
a timely SEC filing status by completing its 2003 10-K filing in
August. Interpool is expected to become current with its SEC
filings before the end of 2004.

The note issuance is pari passu with Interpool's existing
$210 million of senior unsecured notes. Partial proceeds from the
new issuance will be used to repurchase from the investors in the
new notes approximately $49 million of the company's outstanding
senior unsecured notes due in 2007. Interpool has indicated that
the remaining proceeds will be used for general corporate purposes
and to facilitate intermodal equipment fleet growth.

The Positive Rating Outlook reflects Fitch's view that Interpool
will continue its progress towards returning to a timely SEC
filing status and that, shortly thereafter, the company will seek
to re-establish its listing on the New York Stock Exchange. Fitch
also believes that, despite the challenges that the company has
faced with its accounting, operations, and limited capital markets
access, Interpool's liquidity and capitalization remain adequate.
This has been a function of management's conservative operating
strategy as well as favorable operating conditions in the
intermodal equipment leasing market over the past twelve months.

Interpool's remaining challenges focus on the completion of
quarterly financial statements for fiscal 2004. However,
Interpool has so far been able to meet or exceed its publicly
announced filing deadlines for the year. Additional challenges
center on refinancing or extending its revolving credit facility
within the next ten months to provide additional back-up committed
liquidity, and discussions in this regard are currently underway.
Interpool must also complete the overhaul and upgrade of its
information technology and accounting infrastructure.


ION NETWORKS: Negative Financial Results Raise Going Concern Doubt
------------------------------------------------------------------
At June 30, 2004 ION Networks, Inc., had an accumulated deficit of
$43,958,607 and a working capital deficiency of $193,280. The
Company also realized a net loss of $309,061 and $631,869 for the
three- and six-month periods ended June 30, 2004, respectively.
The Company continues to experience a shortfall in the cash
necessary to expand operations. Management and the Board of
Directors are exploring various alternatives to secure funding
necessary to meet its cash requirements. These factors raise
substantial doubt about the entity's ability to continue as a
going concern.  

Any future operations are dependent upon the Company's ability to
obtain additional debt or equity financing, and its ability to
generate revenues sufficient to fund its operations. There can be
no assurances that the Company will be successful in its attempts
to generate positive cash flows or raise sufficient capital
essential to its survival. Additionally, even if the Company does
raise operating capital, there can be no assurances that the net
proceeds will be sufficient enough to enable it to develop its
business to a level where it will generate profits and positive
cash flows. These matters raise substantial doubt about the
Company's ability to continue as a going concern.

                        About the Company

ION Networks, Inc. designs, develops, manufactures and sells
infrastructure security and management products to corporations,
service providers and government agencies. The Company's hardware
and software products are designed to form a secure auditable
portal to protect IT and network infrastructure from internal and
external security threats. ION's infrastructure security solution
operates in the IP, data center, and telephony environments and is
sold by a direct sales force and indirect channel partners mainly
throughout North America and Europe.


IPALCO ENTERPRISES: S&P Affirms BB+ Corporate Credit Rating
-----------------------------------------------------------
Standard & Poor's Ratings Services affirmed its 'BB+' corporate
credit ratings on IPALCO Enterprises, Inc., and its subsidiary
Indianapolis Power & Light Co. and revised the outlook on the
companies to positive from stable.

The outlook revision is solely due to the companies' rating
linkage to The AES Corp. (B+/Positive/--), whose corporate credit
rating was also affirmed and outlook revised to positive.

The outlook revision on AES reflects a trend of improving credit
metrics both at the parent level and on a consolidated basis over
the past year, a trend that should continue based on management's
public statements regarding its goals for debt reduction and
Standard & Poor's expectations of future portfolio performance.

Standard & Poor's expects that AES will maintain or improve its
portfolio's cash flow quality and reduce parent level debt to
approximately $4.5 billion over the next 18 to 24 months.  If this
can be accomplished while maintaining its target liquidity of
$400 million to $600 million, an upgrade to 'BB-' is likely.

The ratings on IPALCO Enterprises Inc., the parent of Indianapolis
Power & Light, reflect the company's linkage to AES.  IPALCO was
acquired by AES in early 2001.  AES is a global power company that
owns assets throughout the world.

Standard & Poor's ratings on individual entities in AES reflect
AES' consolidated credit quality, which is significantly weaker
than that of IPALCO and Indianapolis Power & Light.


KENNAMETAL INC: Moody's Affirms Ba1 Long-Term Sr. Unsec. Ratings
----------------------------------------------------------------
Moody's Investors Service raised the outlook for Kennametal Inc.'s
ratings to positive from stable and affirmed its long-term senior
unsecured ratings of Ba1.  Moody's also assigned a senior implied
rating and issuer rating of Ba1 to Kennametal.

Moody's positive outlook reflects:

   (1) Kennametal's increasing cash flow generation stemming from
       higher rates of industrial production and its successful
       integration of the Widia Group acquisition,

   (2) Moody's expectations that Kennametal will deploy cash flows
       for permanent debt reduction thereby further enhancing its
       debt protection metrics and,

   (3) Moody's opinion that the company also will execute on its
       growth strategy through new product introductions and
       selected acquisition activity in a disciplined manner.

Moody's looks for continued improvement in Kennametal's
performance over the coming quarters.

Ratings affirmed:

     (i) Kennametal Inc. $300 million senior unsecured notes, due
         2012, rated Ba1,

    (ii) Kennametal Inc. senior unsecured/senior subordinated
         shelf filing, rated (P)Ba1/ (P)Ba2,

   (iii) Kennametal Finance I guaranteed preferred securities
         rating of (P)Ba2.

Rating assigned:

    (iv) Kennametal Inc. senior unsecured issuer rating of Ba1.

     (v) Kennametal Inc. senior implied rating of Ba1.

Moody's ratings reflect:

   * Kennametal's demonstrated ability to generate significant
     cash flow during the recent protracted downturn in domestic
     industrial production,

   * its progress with deleveraging its balance sheet,

   * success with lowering its overall cost structure, and

   * successful completion of its integration of the Widia Group.

The rating also recognizes:

   * the company's market leading position in metalworking
     products,

   * the diversity of its customer base, and

   * its expanded geographic presence.

At the same time, however, Moody's ratings incorporate:

   * Kennametal's vulnerability to the cyclicality of industrial
     production that is inherent in its business model,

   * its exposure to rising input costs,

   * potential for margin compression from any inability to
     recapture rising costs through higher prices,

   * its lack of visibility on order rates, and

   * difficulty with divesting businesses that it had targeted for
     exit.

Among the issues factored into Kennametal's ratings are certain
risks associated with its prospective acquisition activity
including the potential for meaningful re-leveraging.  In recent
years, Kennametal's tolerance for significant levels of debt in
its capital structure has been demonstrated and in Moody's
opinion, the company's moderate size and vulnerability to economic
cyclicality warrant a more conservative use of leverage in its
capital structure than similarly rated entities.  Going forward,
the company's use of leverage is expected to be permanently
reduced, inclusive of acquisition-related funding.  Moody's notes
an additional impact of Kennametal's acquisition activity has been
the creation of a sizable goodwill asset on its balance sheet, now
representing 25% of its total assets, which could be indicative of
elevated acquisition multiples and act as a drag on its ability to
generate adequate returns on assets (defined as EBIT / total
assets).

Nevertheless, Kennametal has generated gross cash flow (defined
as, cash from operating activities before working capital) in
excess of $130 million in each of the past two years.  This level
of cash flow has facilitated debt reduction and sustained
investment in capex, in addition to regular dividend payments.  On
and off balance sheet debt (inclusive of securitized receivables)
at fiscal year end of $557 million was notably below the
$625 million at the prior fiscal year-end, and combined with
improved profitability, resulted in a leverage ratio of 2.7 times,
down from 3.4 times, respectively.

In Moody's opinion, Kennametal's profitability and cash flows will
be further elevated by cyclical economic strengthening and higher
rates of industrial production, continuing high levels of demand
in Asia, and by its commitment to research and development of
higher-margin new products.  Cash requirements are expected to be
manageable as Kennametal's debt maturity profile is long term and
its pension obligations are largely attributed to international
plans without funding requirements.  Nevertheless, the company
anticipates contributing approximately $7 million to its pension
fund during fiscal 2005 (end June 30).

Kennametal's liquidity position is adequate based on its access to
an unsecured $500 million revolving credit facility (unrated) that
contains three financial covenants, one of which restricts maximum
leverage to 3.0 times and limits total availability (to
$274 million at June 30).  Additionally, the company maintains an
accounts receivable securitization facility of $125 million that
is largely utilized for working capital needs; its cash balance is
modest at an average of about $25 million.

Upward pressure may be exerted upon the ratings from:

   * Kennametal's permanent deleveraging to conservative levels of
     2.0 times or less,

   * its ability to use pricing leverage with its customers to
     pass along raw material inflation, or

   * the realization of improved working capital management from
     visibility into order demand.

Conversely, downward pressure may be applied to the outlook or
rating from any transaction that would adversely affect
Kennametal's leverage ratio or unduly stress its balance sheet.  A
leverage ratio of 3.0 times would be likely to exert negative
pressure on the outlook and ratings.

Headquartered in Latrobe, Pennsylvania, Kennametal is a global
leader in the manufacture, purchase and distribution of a broad
range of tools, tooling systems, and solutions to the
metalworking, mining, oil and energy industries, and wear-
resistant parts for a wide range of industries.  For fiscal year
end June 30, 2004, Kennametal Inc. reported revenues of
$1.97 billion.


MERRILL LYNCH: Fitch Affirms BB Rating After Interest Payment
-------------------------------------------------------------
Fitch Ratings affirms the $48.5 million class E of Merrill Lynch
Mortgage Investors, Inc.'s mortgage pass-through certificates,
series 1996-C1, at 'BB' and removes it from Rating Watch Negative.  
Class E was placed on Rating Watch Negative as a result of
interest shortfalls due to the reimbursement of servicing
advances.  Interest shortfalls are currently being repaid to
class E.

As reported in the Troubled Company Reporter on March 29, 2004,
Fitch Ratings placed the $48.5 million class E rated 'BB' Rating
Watch Negative.

The Rating Watch Negative placement is the result of interest
shortfalls incurred by class E as of the March 2004 distribution
date. The master servicer, GMAC Commercial Mortgage Corp., is
recouping approximately $1.35 million in advances on the West
Kentucky Outlet Center, a real estate owned (REO) property.  The
property was recently re-valued at $750,000.  


MORGAN STANLEY: Fitch Junks $22.6 Million Class H Certificate
-------------------------------------------------------------
Fitch downgrades and removes from Rating Watch Negative these
classes of Morgan Stanley Capital I Inc., series 1997-XL1:

   -- $26.4 million class G to 'B' from 'BB';
   -- $22.6 million class H to 'CCC' from 'B-'.

In addition, these classes are affirmed:

   -- $20.0 million class A-1 at 'AAA';
   -- $64.0 million class A-2 at 'AAA';
   -- $226.2 million class A-3 at 'AAA';
   -- Interest Only (IO) class X at 'AAA';
   -- $22.6 million class B at 'AAA';
   -- $22.6 million class C at 'AAA';
   -- $45.3 million class D at 'AA';
   -- $45.3 million class E at 'BBB+';
   -- $41.5 million class F at 'BBB-'.

The downgrades are due to the declining operating performance with
three of the properties:

   * The Grand Kempinksi Hotel (9.2%);
   * Westgate Mall (7.1%); and
   * Westshore Mall (3.3%).

The Grand Kempinksi Hotel is secured by a 528-unit, full service
hotel located in Dallas, Texas.  Occupancy, average daily rate,
and revenue per available room have all dropped significantly
since issuance due to the overall economy and the addition of new
supply to the area.  As of the year to date ended May 2004, the
Fitch-stressed debt service coverage ratio -- DSCR -- on an
annualized basis was 0.77 times (x).  However, the revenue per
available room for YTD May 2004 has shown an improvement of
approximately 30% over year-end 2003, primarily as a result of
improved occupancy levels.  The loan remains current, and the
borrower has recently completed a $2.5 million expansion and
improvement for the hotel's meeting facilities, which serves as a
main draw.  Additionally, as of June 2004, a room renovation
project began that is expected to be completed in phases over the
next few years.

Westgate Mall is a 789,222 square foot regional mall located in
Fairview Park, Ohio. Collateral for the loan consists of 225,553
square feet of in-line space, as well as 289,031 sf of anchor
space occupied by Dillards North and Kohl's.  The loan was
transferred to the special servicer in January 2003 because the
borrower expressed hardship in meeting the loan's debt service
obligations.  As of May 2004, the collateral was approximately 70%
occupied compared with 89.0% at issuance.  The loan is currently
delinquent, and the borrower is remitting monthly net cash flow
payments under a six-month forbearance agreement.

The third loan of concern, Westshore Mall, is anchored by JC
Penney, Sears, Younkers, and Dunham's Sports, which opened at the
center in November 2003.  Located in Holland Township, Michigan,
the mall contains approximately 473,619 sf, of which 393,949 sf
serves as collateral for the loan.  Excluded from the collateral
is an adjacent 79,670 sf Target store.  As of March 31, 2004, the
in-line occupancy had dropped to approximately 76%, compared with
95% at issuance.  Fitch's YE 2003 net cash flow -- NCF -- is down
40% from issuance, and the corresponding Fitch-stressed DSCR is
1.04x.

As of the September 2004 remittance date, the pool has paid down
28.9% due to scheduled amortization and loan payoffs.
Additionally, three loans, 605 Third Avenue (22.4%), the Edens and
Avant Portfolio (15.4%), and the FGS Portfolio (11.1%),
representing 48.9%, have been fully defeased.

Of the remaining three loans in the transaction, one loan has
shown significant improvement since issuance. Fashion Mall,
representing 11.2% of the pool, saw its Fitch-adjusted YE 2003 --
NCF -- increase approximately 37% from issuance and was 91.8%
occupied as of March 31, 2004.  The corresponding Fitch DSCR as of
YE 2003 was 2.47x as compared with 1.91x at issuance.

The Mansion Grove Apartment's decline in NCF of 8.5% since
issuance can be attributed to rental concessions and increased
expenses.  However, occupancy remains high at 95.8% as of YE 2003.  
The YE 2003 NCF for the Mark Centers Portfolio is up approximately
4.5% from issuance and has a YE Fitch-stressed DSCR of 1.62x.  Of
some concern is the drop in occupancy to 85% for the portfolio
from 90% at issuance.


NEW VISUAL: Prepares Prospectus on 18.2 Million Common Shares
-------------------------------------------------------------
New Visual Corporation's recently prepared a prospectus relates to
the sale by certain selling stockholders of 18,166,668 shares of
Company common stock, par value $0.001.

The selling stockholders may sell the shares from time to time at
the prevailing market price or in negotiated transactions.

New Visual will not receive any of the proceeds from the sale of
the shares by the selling stockholders.

Each of the selling stockholders may be deemed to be an
"underwriter," as such term is defined in the Securities Act of
1933.

                        About the Company

New Visual is developing advanced transmission technology that
allows data to be transmitted across copper telephone wire at
speeds that greatly exceed those offered by DSL technology
providers. The company will market this pioneering technology to
leading chipmakers, equipment makers, and service providers (such
as telephone companies), in the telecommunications industry. The
Company's technology is designed to dramatically increase the
capacity of the copper telephone network, thereby allowing these
entities to provide video, data and voice services over the
existing copper telecommunications infrastructure, eliminating the
need for fiber optic cable to the home or office. The Company's
common stock is quoted on the OTC Electronic Bulletin Board under
the trading symbol "NVEI".

                           *     *     *

                        Going Concern Doubt

In its Form 10-QSB for the quarterly period ended July 31, 2004,
filed with the Securities and Exchange Commission, New Visual
Corp. has reported incurred losses in each of its years of
operation, negative cash flow and liquidity problems. These
conditions raise substantial doubt about the Company's ability to
continue as a going concern. The accompanying consolidated
financial statements do not include any adjustments relating to
the recoverability of reported assets or liabilities should the
Company be unable to continue as a going concern.

The Company has been able to continue based upon its receipt of
funds from the issuance of equity securities and borrowings,
including the additional Debentures purchased following the filing
of the registration statement in February 2004, and by acquiring
assets or paying expenses by issuing stock. In May 2004, the
Company raised net proceeds of approximately $218,220 upon the
purchase by holders of the Debentures of an aggregate of $250,000
in principal amount of Debentures. In July 2004, the Company
entered into a revolving line of credit agreement with Wells Fargo
Bank, National Association which allows it to borrow up to
$100,000 on a revolving basis until August 10, 2005. The Company's
continued existence is dependent upon its continued ability to
raise funds through the issuance of its securities or borrowings,
and its ability to acquire assets or satisfy liabilities by the
issuance of stock. Management's plans in this regard are to obtain
other debt and equity financing until profitable operation and
positive cash flow are achieved and maintained. There can be no
guarantee that financing will be available on commercially
acceptable terms, or at all.


NORTHERN KENTUCKY: U.S. Trustee Picks 3-Member Committee
--------------------------------------------------------
The U.S. Trustee for Region 8 appointed three creditors
to serve as an Official Committee of Unsecured Creditors
in Northern Kentucky Professional Baseball, LLC's, chapter
11 case:

         1. Keystone Partnership
            Attn: Pat Queensen
            12312 Olive Boulevard, Suite 550
            Creve Coeur, Missouri 63141

         2. Vintage Business Solutions
            Attn: Jeff Grayson
            PO Box 1902
            Louisville, Kentucky 40201-1902

         3. Bluegrass Diesel Spec.
            Attn: Paul Brandner
            1663 Production Drive
            Burlington, Kentucky 41005

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

Headquartered in North Bend, Ohio, Northern Kentucky Professional
Baseball, LLC, operates a professional baseball club. The company
filed for chapter 11 protection on September 3, 2004 (Bankr. E.D.
Ky. Case No. 04-22256). John A. Schuh, Esq., at Schuh & Goldberg,
LLP, represents the Company in its restructuring efforts. When the
Debtor filed for protection from its creditors, it listed
$9,353,870 in total assets and $9,485,394 in total debts.


OCTAGON INVESTMENT: Moody's Puts Low-B Ratings on Class B-2L Notes
------------------------------------------------------------------
Moody's Investors Service assigned ratings to these Octagon
Investment Partners VII, Ltd.'s issues:

   * Aaa to the U.S.$6,400,000 Class X Notes due December 2, 2009
     and the U.S.$294,000,000 Class A-1L Floating Rate Notes Due
     December 2, 2016,

   * Aa2 to the U.S.$23,000,000 Class A-2L Floating Rate Notes Due
     December 2, 2016,

   * A2 to the U.S.$16,500,000 Class A-3L Floating Rate Notes Due
     December 2, 2016,

   * Baa2 to the U.S.$22,750,000 Class B-1L Floating Rate Notes
     Due December 2, 2016, and

   * Ba2 to the U.S.$10,750,000 Class B-2L Floating Rate Notes Due
     December 2, 2016

Moody's also assigned ratings of:

   * Baa3 to the Class B-1L Combination Notes Due December 2, 2016
     (with an original Rated Balance of U.S.$3,000,000),

   * Ba3 to the Class B-2L Combination Notes Due December 2, 2016
     (with an original Rated Balance of U.S.$1,000,000), and

   * Aaa to the Class P-1 Combination Notes Due December 2, 2016
     (with an original Rated Balance of U.S.$2,400,000).

The collateral of Octagon Investment Partners VII, Ltd. consists
primarily of speculative-grade commercial loans.

According to Moody's, the ratings are based primarily on the
expected loss posed to noteholders relative to the promise of
receiving the present value of such payments.  Moody's noted that
its ratings on each of the combination notes addresses only the
ultimate return to the holders of such combination note of the
Rated Balance with respect to each such combination note (in the
case of the Class P-1 Combination Note, by November 15, 2016).  
Moody's also analyzed the risk of diminishment of cashflows from
the underlying portfolio of corporate debt due to defaults, the
characteristics of these assets and the safety of the
transaction's structure.

The collateral manager is Octagon Credit Investors, LLC.


OHIO VALLEY: Fitch Shaves Bonds' Rating Two Notches to B+
---------------------------------------------------------
Fitch Ratings downgrades to 'B+' from 'BB' the rating on
$11,730,000 County Commission of Ohio County:

   * WV health system refunding and improvement revenue bonds
     (Ohio Valley Medical Center issue), series 1998A, the
     $4,085,000 County Commission of Ohio County,

   * WV health system refunding and improvement revenue bonds
     (Ohio Valley Medical Center issue),

   * series 1998B (taxable), and the $16,165,000 County of
     Belmont, Ohio health system refunding and improvement revenue
     bonds (East Ohio Regional Hospital issue), series 1998.

The bonds are partially insured by ACA Financial Guaranty
Corporation.  The Rating Outlook is Stable.

Ohio Valley Health Services and Education Corporation's rating
downgrade is due to continued operating losses, upcoming capital
needs, and weaker liquidity levels.  Operating losses have
increased to negative $5.3 million (margin of negative 3.6%) in
2003 from negative $3.1 million (margin of negative 2.4%) in 2002.
Ohio Valley Health Services is in the early stages of a
$10 million capital plan to replace aged operating rooms at its
Ohio facility.  The project is being financed with a $5 million
bank loan with a 20-year term, $3 million through fundraising
efforts, and $2 million from existing bond funds.  However, Fitch
is unsure that Ohio Valley Health Services will be able to raise
the entire fundraising amount for the project.  It is also
anticipated that the bank loan will be secured by a mortgage
pledge, which is not available to existing bondholders.

Further weakening bondholder security, Ohio Valley Health Services
has an outstanding line of credit of $2.3 million collateralized
by its investment securities.  Capital needs at Ohio Valley Health
Services are substantial with an average age of plant of 20 years,
which is the highest ever recorded by Fitch, and capacity
constraints at the Ohio facility. Liquidity is very weak at
32.7 days cash on hand and factoring in the line of credit it
would drop to 25.5 days at June 30, 2004.  With the additional
debt, cash to debt declines to 24.1% during the same period,
compared with 26.4% in 2003.  MADS coverage, which includes debt
service on the new debt, is 0.6 times (x) in 2002 and 1.4x in
2003.

Other risks include the difficult malpractice environment in West
Virginia and the unfavorable service area characteristics.  
Operations were largely affected by a doctors' strike in early
2003 at Ohio Valley Medical Center in West Virginia due to
skyrocketing malpractice premiums.  Ohio Valley Health Services'
malpractice premiums have increased to $4.7 million in 2003 from
$1.1 million in 2001, while at the same time its malpractice
insurance coverage has been reduced considerably.  Tort reform has
since then passed, which limits the amount of non-economic damages
awarded in a potential lawsuit.  However, the flight of physicians
out of WV into neighboring Ohio has been significant.  The service
area characteristics in West Virginia remain unfavorable, with
low-income levels, a concentration in steel manufacturing, and
high unemployment.  Two steel companies in the area have recently
emerged from bankruptcy; however, staff downsizing and layoffs
have occurred.  As a result, bad debt has risen to 6.9% of
revenues through the interim six months of 2004 from 5.6% in 2003.  
Medicaid and self-pay is high at 11.5% and 4.0% in 2003,
respectively.

The Stable Outlook is supported by Ohio Valley Health Services'
continued strategic focus at its Ohio facility, which has led to
improved operations and the implementation of cost-cutting
initiatives.  Ohio Valley Health Services has downsized services
provided by Ohio Valley Medical Center, while concentrating more
on the complement of services provided at East Ohio Regional
Hospital in Ohio.  Income from operations at East Ohio Regional
Hospital increased to $1.3 million (operating margin of 2.1%) in
2003 from near breakeven in 2002, compared with a loss of $4.4
million (excludes losses at Peterson Rehabilitation Hospital) at
Ohio Valley Medical Center in 2003.  Through the interim six
months of 2004, operating income for Ohio Valley Health Services'
improved to a loss of $373,000 (negative 0.5% operating margin)
resulting in MADS coverage of 1.4x. Management believes the
performance through the six months is reflective of year-end
results for 2004.  Ohio Valley Health Services' has been
successful in redirecting much of the physician flight to East
Ohio Regional Hospital.  As a result, patient volume has exhibited
strong growth at East Ohio Regional Hospital with discharges,
outpatient surgeries, and emergency room visits increasing 15.7%,
7.3%, and 8.9% in 2003, respectively, over the prior year.  In
addition, Ohio Valley Health Services' has undertaken cost-cutting
initiatives such as the sale of Peterson Rehabilitation Hospital
in 2003, which lost $714,118 in 2002 and $985,788 in 2003.  
Furthermore, Ohio Valley Health Services' hired Cardinal Health in
2004 to identify cost-savings opportunities related to labor
productivity and utilization, reductions in average length of
stay, and supply costs.  The initiatives are anticipated to have
potential annual savings of $1.4 million.

Ohio Valley Health Services' is a two-hospital system consisting
of Ohio Valley Medical Center, located in Wheeling, West Virginia,
and East Ohio Regional Medical Center, located in Martins Ferry,
Ohio.  The system had a combined total of 243 acute-care beds and
94 long-term care beds with total revenues of $148 million in
2003.  Ohio Valley Health Services' disclosure to Fitch has
historically been adequate and timely.  Ohio Valley Health
Services covenants to only provide annual disclosure within 150
days after the end of the fiscal year.  However, the fiscal 2003
audit was received a month late by Fitch.  Audits are made
available at nationally recognized municipal securities
information repositories.  Quarterly disclosure to Fitch includes
management discussion and analysis, financial statements (includes
balance sheet, income, and cash flow statements), and utilization
statistics.


OMNICARE INC: Expands Pharmaceutical Case Management Business
-------------------------------------------------------------
Omnicare, Inc. (NYSE:OCR), a leading provider of pharmaceutical
care, will provide its proprietary pharmaceutical case management
services for The Procter & Gamble Company retirees and Unisource
Worldwide, Inc., employees and eligible dependents across the
United States. Omnicare will recommend and implement
pharmaceutical intervention programs to improve health and lower
costs for both organizations.

"Providing sustainable, high quality healthcare benefits for
employees and retirees is complicated and costly. Omnicare's
pharmaceutical care programs for both of these prominent
organizations address the dual challenges of managing health risks
and rising costs," said Joel F. Gemunder, president and chief
executive officer of Omnicare. "Our pharmaceutical case management
services are specifically designed to ensure that retirees and
other eligible employees receive the highest quality drug therapy
at the lowest possible cost. Omnicare takes an active role in both
mitigating risk to the health of seniors that some drugs pose and
the risk to their health of not taking appropriate medications."

                     Programs to Improve Quality

The programs being developed by Omnicare for corporate plan
members are specifically designed to improve the quality of
pharmaceutical care. The U.S. Department of Health and Human
Services' Agency for Healthcare Research and Quality recently
defined quality as doing the right thing, at the right time, in
the right way, for the right person, and having the best possible
results. It requires striking the right balance in the provision
of health services by avoiding overuse, misuse and underuse.
Misuse of prescription drugs is well established as a major cause
of preventable death, hospitalization and severe side effects.
Overuse of more expensive agents when less expensive, equally safe
and effective agents are available wastes valuable healthcare
resources. The underuse of proven treatments and resultant gaps in
care is an emerging issue that affects both quality and total
healthcare costs.

Using a corporation's administrative, medical and prescription
claims data, Omnicare is able to identify those most at risk for
adverse medication reactions and those whose current drug therapy
may be improved. Omnicare then designs patient-specific,
therapeutic intervention plans and conducts outreach programs with
physicians and other care-givers to implement these plans.

The specific programs that Omnicare will conduct for its new
corporate clients are designed to:

   -- reduce prescription drug costs of plan members through lower
      copayments or coinsurance by patient-specific therapeutic
      interchange to equally safe and effective, but less
      expensive medications;

   -- identify plan members at risk for medication-related
      problems due to undertreatment of disease states or adverse
      consequences and therapeutic failures. Examples of these
      programs include:

         1. reducing the use of drugs demonstrated to increase the
            risks of fractures

         2. increasing preventative care of osteoporosis,       
            including pharmacological therapy aimed at preserving
            or building bone mass, when warranted

         3. improving quality of care by managing risks associated
            with high blood pressure

    Improved Pharmaceutical Care Based on Scientific Guidelines

The foundation for all of Omnicare's corporate pharmaceutical case
management services is the Omnicare Geriatric Pharmaceutical Care
Guidelines(R), a proprietary physician reference tool that was the
first formulary developed specifically for improving geriatric
drug therapies. Now in its eleventh edition, the Omnicare
Guidelines(R) is clinically evaluated and reviewed by the
University of the Sciences in Philadelphia, which is a nationally
recognized authority on geriatric pharmaceutical care. In
addition, it is endorsed by the American Geriatrics Society. The
Omnicare Guidelines(R) ranks the clinical effectiveness of drugs
and drug classes as "Preferred," "Acceptable" or "Unacceptable"
for treatment of nearly 60 diseases and conditions commonly
occurring in seniors.

               Health Management Not Cost Management

"We are working with Omnicare to implement these programs because
Omnicare understands our healthcare issues and has proven clinical
expertise in improving the quality of therapy in a cost-effective
manner," said J. Michael Rowell, director, compensation and
benefits for Unisource. "This effort will help to coordinate
pharmaceutical care so that our plan members get the prescriptions
they need while protecting them from inappropriate drug therapies.
Partnering with Omnicare to develop programs to improve
pharmaceutical healthcare safety and effectiveness for our plan
members is part of Unisource's effort to find new ways to improve
the quality of healthcare as well as manage its cost."

"The key to managing healthcare for plan members is not merely
managing the unit cost of pharmaceuticals but, rather, managing
their appropriate use," stated Gemunder. "As Omnicare continues to
partner with more and more corporations, we hope to see
substantial improvements in both health outcomes and costs."

                           About Omnicare

Omnicare, Inc. -- http://www.omnicare.com/-- a Fortune 500  
company based in Covington, Kentucky, is a leading provider of
pharmaceutical care for the elderly. Omnicare serves residents in
long-term care facilities comprising approximately 1,054,000 beds
in 47 states and the District of Columbia, making it the nation's
largest provider of professional pharmacy, related consulting and
data management services for skilled nursing, assisted living and
other institutional healthcare providers. Omnicare also provides
clinical research services for the pharmaceutical and
biotechnology industries in 29 countries worldwide.

                           *     *     *

As reported in the Troubled Company Reporter's May 26, 2004
edition, Standard & Poor's Ratings Services placed its ratings on
Omnicare Inc., including the 'BBB-' corporate credit ratings, on
CreditWatch with negative implications after the long-term care
pharmacy provider disclosed an all-cash offer to purchase
competitor NeighborCare Inc.

At the same time, the ratings on NeighborCare, including the 'BB-'
corporate credit rating, were also placed on CreditWatch with
negative implications, as the pro forma combination is likely to
have a markedly weaker financial profile than NeighborCare. The
purchase price of $1.5 billion includes the assumption or
repayment of a $250 million NeighborCare debt issue. Estimating
the effect of additional debt and not assuming any cost savings,
total debt to EBITDA is expected to rise to over 4x, while funds
from operations to total debt will fall to less than 15%.

"We expect to meet with Omnicare management to determine what cash
flow benefits can be realized and the ultimate nature of the
financial structure of the combined company before resolving the
CreditWatch listing," said Standard & Poor's credit analyst David
Lugg.


PACIFIC GAS: Files Gas Accord III Settlement with CPUC
------------------------------------------------------
On August 27, 2004, Pacific Gas and Electric Company and all  
other active parties in PG&E's gas transmission and storage 2005  
rate case, including The Utility Reform Network and the  
California Public Utilities Commission Office of Ratepayer  
Advocates, filed a joint motion with the CPUC seeking approval of  
a proposed comprehensive settlement agreement.  If approved by  
the CPUC, Dinyar B. Mistry, PG&E's Vice President and Controller,  
relates in a filing with the Securities and Exchange Commission,  
the Gas Accord III Settlement will, among other things, set  
PG&E's gas transmission and storage rates and market structure  
for a three-year term, commencing January 1, 2005.  The Gas  
Accord III Settlement would maintain the current Gas Accord  
market structure and service options.  

The Gas Accord III Settlement provides a gas transmission and  
storage revenue requirement of approximately $428,500,000 for  
2005 and a 2% per year increase for the following two years.  For  
the year 2006, the revenue requirement would be approximately  
$436,600,000, and for the year 2007, the revenue requirement  
would be approximately $444,900,000.  The Gas Accord III  
Settlement also provides that PG&E should file its next gas  
transmission and storage rate case application no later than  
February 9, 2007, for rates to be in effect by January 1, 2008.

Comments and reply comments on the joint motion are due in  
September.  A final decision is expected before the end of the  
year.  PG&E and its parent, PG&E Corporation, are unable to  
predict the ultimate outcome of this proceeding, Mr. Mistry says.

                         PG&E's Statement

     SAN FRANCISCO, California -- August 30, 2004 -- Pacific Gas  
and Electric Company has reached a three-year agreement on  
natural gas transportation and storage costs with all active  
parties involved in the proceedings -- including The Utility  
Reform Network (TURN), the Office of Ratepayer Advocates (ORA),  
power plant operators, gas producers and suppliers, business  
groups representing commercial and industrial gas end-users,  
independent storage operators and the State of California's  
Department of General Services.

     If approved by the California Public Utilities Commission  
(CPUC), the Gas Accord III Settlement will set natural gas  
transportation and storage rates for all customers -- residential  
and business -- for the next three years, beginning in January  
2005 and expiring December 2007.  It will continue the Gas Accord  
market structure for PG&E's gas transmission and storage system,  
which was first implemented in 1998.

     This rate setting proceeding ensures stability and  
predictability in the gas transmission and storage industry in  
northern California for the next three years.

     "With much uncertainty in the natural gas market throughout  
the country, a three-year settlement provides economic stability  
and predictability in gas deliveries through our entire system,"  
said Mike Katz, vice president of PG&E's California Gas  
Transmission.  "For businesses who receive natural gas directly  
from transmission facilities this agreement will result in  
significant savings."

     If approved, beginning in 2005, all customers would see a  
decrease in their gas transportation rate.  The transportation  
rate decrease for industrial and electric generation transmission  
ranges from six to 12 percent.  These customers are not on  
bundled service as they purchase optional storage and backbone  
services separately.  Storage and backbone rates are going up  
slightly for bundled customers-residential and small commercials-
this would mean a slight overall bill increase of less than one-
half of one percent for services covered by this settlement for  
the next three years.

     This Gas Accord III Settlement received support from  
representatives of residential ratepayers and all sectors of the  
natural gas and electric power industries.  By providing  
suppliers the opportunity to continue existing transmission and  
storage contracts, the Settlement would also help stabilize the  
electric market, since natural gas is a primary fuel for electric  
generation in California.

     This proposed Gas Accord III settlement establishes the  
market structure, rates, and terms and conditions of service for  
gas transmission and storage under the jurisdiction of the CPUC.  
It is anticipated that the CPUC may rule on the settlement by  
mid-December.

Headquartered in San Francisco, California, Pacific Gas and
Electric Company -- http://www.pge.com/-- a wholly owned  
subsidiary of PG&E Corporation (NYSE:PCG), is one of the largest
combination natural gas and electric utilities in the United
States.  The Company filed for Chapter 11 protection on April 6,
2001 (Bankr. N.D. Calif. Case No. 01-30923).  James L. Lopes,
Esq., William J. Lafferty, Esq., and Jeffrey L. Schaffer, Esq., at
Howard, Rice, Nemerovski, Canady, Falk & Rabkin represent the
Debtors in their restructuring efforts.  On June 30, 2001, the
Company listed $23,216,000,000 in assets and $22,152,000,000 in
debts.  Pacific Gas and Electric emerged from chapter 11
protection on April 12, 2004, paying all creditors 100 cents-on-
the-dollar plus post-petition interest.  (Pacific Gas Bankruptcy
News, Issue No. 83; Bankruptcy Creditors' Service, Inc.,
215/945-7000)   


PAM CAPITAL: Moody's Affirms Class B Notes' B1 Rating After Review
------------------------------------------------------------------
Moody's Investors Service confirmed the ratings of two classes of
notes issued by PAM Capital Funding LP, which had previously been
on watch for downgrade:

     (1) the U.S. $1,095,000,000 Class A Floating Rate Senior
         Secured Notes due May 1, 2010 (currently rated Aa2), and

     (2) the U.S. $141,250,000 Class B-1 Fixed Rate Second Senior
         Secured Notes due May 1, 2010 and U.S. $121,250,000 Class
         B-2 Floating Rate Second Senior Secured Notes due May 1,
         2010 (currently rated B1).

Moody's noted that the transaction closed on May 19, 1998.

According to Moody's, its current rating action reflects recent
delevering of the Issuer's Class A Notes (by more than
$500,000,000 million).  However, Moody's noted that certain key
attributes of the collateral pool have not shown significant
improvement since Moody's placed these notes under review for
downgrade.  For example, excluding defaulted securities, nearly
40% of the collateral pool has a Moody's rating of Caa1or lower
(46% at the time of Moody's watchlist action) and the weighted
average rating factor of the collateral pool is 4259 (4413 at the
time of the Moody's watchlist action; 2950 limit).

Rating Action:       Rating Confirmation

Issuer:              PAM Capital Funding LP

Class Description:   U.S. $1,095,000,000 Class A Floating Rate
                     Senior Secured Notes due 2010

Prior Rating:        Aa2 (under review for downgrade)

Current Rating:      Aa2

Class Description:   U.S. $141,250,000 Class B-1 Fixed Rate Second
                     Senior Secured Notes due 2010

                     U.S. $121,250,000 Class B-2 Floating Rate             
                     Second Senior Secured Notes due 2010

Prior Rating:        B1 (under review for downgrade)

Current Rating:      B1


PEGASUS SATTELITE: Wants Exclusive Period Extended Until Nov. 30
----------------------------------------------------------------
Section 1121(b) of the Bankruptcy Code provides for an initial
period of 120 days after the commencement of a Chapter 11 case
during which a debtor has the exclusive right to file a plan of
reorganization.  Section 1121(c)(3) provides that if the debtor
files a plan within the 120-day exclusive period, it has an
initial period of 180 days after the Petition Date to obtain
acceptance of the plan.

In circumstances where the initial 120- and 180-day Exclusive
Periods provided for in the Bankruptcy Code prove to be an
unrealistic time frame within which the debtor may otherwise be
forced to file a plan of reorganization, Section 1121(d) allows
the Bankruptcy Court to extend the debtor's exclusive periods:

    "On request of a party in interest . . . and after notice and
    a hearing, the court may for cause reduce or increase the
    120-days period or the 180-day period. . . ."

Robert J. Keach, Esq., at Bernstein, Shur, Sawyer & Nelson, in
Portland, Maine, tells the United States Bankruptcy Court for the
District of Maine that the Pegasus Satellite Communications, Inc.
and its debtor-affiliates have taken several key steps towards a
successful and consensual resolution of their Chapter 11 cases.  
The Debtors have:

   (1) negotiated and executed a global settlement agreement to
       settle all litigation with DIRECTV, Inc., and the National
       Rural Telecommunications Cooperative;

   (2) negotiated and executed an asset purchase agreement as
       part and parcel of the Global Settlement, which provides
       for the sale of substantially all of their Direct
       Broadcast Satellite business to DIRECTV; and

   (3) engaged in negotiations regarding the sale of
       substantially all of the assets of Pegasus Broadcast
       Television, Inc., together with its subsidiaries to
       Pegasus Communications Corporation, subject to higher and
       better offers, and to be memorialized in an asset purchase
       agreement subject to Court approval.

The Debtors' cases are large and complex, Mr. Keach continues.  
There are 28 debtors in these procedurally consolidated Chapter
11 cases.  As of March 31, 2004, the Debtors had assets in excess
of $1,600,000,000 and generated net revenues of about $831,200,000
during calendar year 2003.

The Debtors have worked expeditiously to address the critical
issues, which have been complex and all consuming to them.  Since
the Petition Date, the Debtors have been heavily engaged in
litigation battling for their very survival.  The Debtors have
simultaneously dealt with maintaining and retaining a stable work
force as well as dealing with all of the business and operational
issues that Chapter 11 debtors typically face.

These efforts have culminated in the Global Settlement, which
realizes the highest possible value for the DBS business for the
benefit of the Debtors and their estates.  Without this critical
element in place, it would not be possible for the Debtors to
contemplate a confirmable Chapter 11 plan.

While the Debtors have made significant progress towards reaching
that goal with the execution of the Global Settlement, the
Satellite Asset Purchase Agreement and Cooperation Agreement, Mr.
Keach asserts that the Debtors still need additional time to
propose a confirmable reorganization plan.

Accordingly, the Debtors ask the Court to extend their exclusive
period to:

   (a) file a reorganization plan until November 30, 2004; and

   (b) solicit acceptances of the plan until January 30, 2005.

Mr. Keach explains that the chances of obtaining a consensual
reorganization plan will be decidedly increased if the Debtors are
allowed the time to carry out their obligations under the Global
Settlement, free from the distractions of a competing
reorganization plan.  Absent an extension, the significant
progress the Debtors have made to date would be jeopardized,
thereby defeating the very purpose of Section 1121 -- which is to
afford a debtor a meaningful and reasonable opportunity to
negotiate with creditors and propose and confirm a consensual
reorganization plan.

Mr. Keach assures that Court that the extension will not prejudice
the legitimate interests of any creditor or equity security
holder.  The extension will afford the parties the opportunity to
pursue to fruition the beneficial objectives of a consensual
reorganization plan.  The Official Committee of Unsecured
Creditors has no objection to the Debtors' request.

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


PENN OCTANE CORP: SEC Declares Registration Statement Effective
---------------------------------------------------------------
The Securities and Exchange Commission has declared effective the
registration statement on Form 10 filed by Rio Vista with the SEC
on Aug. 26, 2004, as amended by Amendment No. 1 thereto filed with
the SEC on Sept. 16, 2004 (SEC File No. 000-50394). The
registration statement is in connection with Penn Octane Corp.'s
(NASDAQ:POCC) proposed spin-off to its common stockholders of the
common units of Rio Vista Energy Partners L.P., currently a wholly
owned subsidiary of Penn Octane.

Based on current information, the Spin-Off is expected to be
completed and the distribution of Rio Vista common units is
expected to take place on or about Sept. 30, 2004. Each Penn
Octane stockholder will be entitled to receive one Rio Vista
common unit for every eight shares of Penn Octane common stock
held on that date.

As indicated in the Form 10, the record date for determination of
Penn Octane stockholders entitled to receive Rio Vista common
units is Sept. 17, 2004. However, under applicable rules of the
National Association of Securities Dealers Inc., if any
stockholder of Penn Octane on the record date sells shares of Penn
Octane common stock after the record date but on or before the
distribution date, the buyer of those shares, and not the seller,
will become entitled to receive the Rio Vista common units
issuable in respect of the shares sold. Accordingly, only
stockholders who hold Penn Octane common stock on the distribution
date will ultimately be entitled to receive Rio Vista common
units. The ex-date on which shares of Penn Octane common stock
will begin trading without the right to receive the distribution
of Rio Vista common units, and the date on which Rio Vista units
will begin regular-way trading on the Nasdaq National Market under
the symbol RVEP, is expected to be Oct. 1, 2004, the first
business day following the distribution date.

Penn Octane's schedule for completion of the Spin-Off represents
its good faith expectation regarding this matter. The completion
of the Spin-Off is subject to various conditions that are detailed
in the Form 10. The Form 10, including the exhibits that were
filed as part of the Form 10, provides greater detail with respect
to these conditions. Please refer to the Form 10 filed on Sept.
16, 2004, by Rio Vista and the Form 10-Q/A filed on July 23, 2004,
by Penn Octane for more information concerning the Spin-Off.

                    About Penn Octane Corp.

Penn Octane is a supplier of Liquefied Petroleum Gas (LPG) to
Northeastern Mexico. Penn Octane leases a 132-mile, six-inch
pipeline which connects from a pipeline in Kleberg County, Texas,
to its terminal in Brownsville, Texas, which historically served
as a trans-shipment point for truck delivery to Mexico. Until the
Spin-Off is consummated, the company will continue to own and
operate a 21-mile pipeline which connects the terminal in
Brownsville to a storage and distribution terminal in Matamoros,
Tamaulipas, Mexico. The company also utilizes a 12-inch propane
pipeline which connects certain gas plants in Corpus Christi,
Texas, to its pipeline in Kleberg County. The company's network is
further enhanced by the 155 miles of pipeline it has rights to use
to transport LPG to and from its storage facility of 500,000
barrels in Markham, Texas, that enhances the company's ability to
bring LPG to Northeastern Mexico. The company has recently begun
operations of its gasoline and diesel fuel reseller business. By
allocating portions of certain pipeline and terminal space located
in California, Arizona, Nevada and Texas to the company, the
company is able to sell gasoline and diesel fuel at rack loading
terminals and through bulk and transactional exchanges.

                           *     *     *

As reported in the Troubled Company Reporter on August 10, 2004,
The auditing firm of Burton, McCumber & Cortez, L.L.P. in
Brownsville, Texas, included an explanatory paragraph in Penn
Octane Corporation's financial statements as of July 31, 2003,
raising substantial doubt about the Company's ability to continue
as a going concern.

These facts were previously contained in the firm's Auditors
Report to the Board of Directors of Penn Octane Corporation, and
dated May 28, 2004.


PENTON MEDIA: Promotes Mollison & Blansfield to Executive Group
---------------------------------------------------------------
Penton Media, Inc., (OTCBB:PTON), a diversified business-to-
business media company, has announced the promotions of executives
Teri Mollison and David Blansfield.

Ms. Mollison was named Group Publisher, with operating
responsibility for the Company's Manufacturing Group, Supply Chain
Group and Metals Group. She was formerly Publisher of IndustryWeek
magazine and its related media products and services.

Penton's Manufacturing Group includes IndustryWeek, American
Machinist, Cutting Technology, Gases & Welding Distributor and
Welding Design & Fabrication magazines and their related online
and in-person media.

The Supply Chain Group includes Logistics Today and Material
Handling Management magazines and related online media.

The Metals Group includes Forging, Foundry Management & Technology
and Metal Producing & Processing magazines and their related
online products.

Ms. Mollison joined Penton in September 1999 as Director of
Advertising and Marketing for the IndustryWeek brand. She was
named publisher of IndustryWeek in September 2000. Prior to
joining Penton, Ms. Mollison worked in various sales and
management capacities for Inc., Fortune and AutoWeek magazines.
She was an on-air reporter for WKAR radio, an NPR affiliate in
East Lansing, MI, and was a sports writer for The Lansing State
Journal. She holds a bachelor's degree in journalism from The
University of Detroit.  Ms. Mollison is based in Penton's
Cleveland office.

Mr. Blansfield also was named Group Publisher, and now has senior
operating responsibility for the Company's Business Technology and
Aviation Groups. He was formerly Group Publisher of the Business
Technology Group.

The Business Technology Group includes Business Finance and
Business Performance Management magazines and their related event
and online media, as well as the internetworld.com Web site and
its related Internet Business e-newsletter.

The Aviation Group includes Air Transport World (ATW) and ATW's
Airport Equipment & Technology magazines and their related
conference and online media properties.

Mr. Blansfield first joined Penton in 1996 as associate publisher
of NEWS/400 magazine. He has served as publisher of Business
Finance magazine since 1998. Prior to joining Penton, Blansfield
was Senior Vice President, advertising, at Thomson Media. Mr.
Blansfield earned a bachelor's degree in journalism from Boston
University and an MBA in finance from Columbia University's
Graduate School of Business.  He works from Penton's Darien, CT,
office.

Ms. Mollison and Mr. Blansfield report to Penton CEO David
Nussbaum.

                     About Penton Media

Penton Media -- http://www.penton.com/-- is a diversified  
business-to-business media company that provides high-quality
content and integrated marketing solutions to several industry
sectors Founded in 1892, the Company produces market-focused
magazines, trade shows, conferences and online media, and provides
a broad range of custom media and direct marketing solutions for
business-to-business customers worldwide.

At June 30, 2004, Penton Media, Inc.'s balance sheet shows a
stockholders' deficit of $170,710,000 compared to a deficit of
$144,929,000 at December 31, 2003.


PREMIER FARMS: Court Declines to Approve Disclosure Statement
-------------------------------------------------------------
The Honorable William L. Edmonds of the U.S. Bankruptcy Court for
the Northern District of Iowa denied approval of the Disclosure
Statement filed by Premier Farms LLC on July 12, 2004.  A full-
text copy of the deficient Disclosure Statement is available for a
fee at:

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

The Court gave eight reasons for declining to approve the
Disclosure Statement:

    1) the paragraph regarding financial information found on    
       page 9 of the Statement should be supplemented with a
       detailed summary of the Debtor's performance from Dec. 8,
       2003 up to present with some details on its profits and
       losses during the five-year period prior to filing;

    2) the Disclosure statement failed to specify the fees and
       expenses incurred to date by the Debtor's accountants;

    3) the Disclosure statement should recognize the Debtor's
       obligation to pay quarterly fees before and after
       confirmation pursuant to 28 U.S.C. Section 1930(a)(6);

    4) the Disclosure Statement failed to identify any potential
       causes of action under chapter 5 of the Bankruptcy Code
       like preferences, fraudulent transfers, etc.;

    5) the Disclosure Statement contradicts the Plan of
       Reorganization regarding the leases; the Disclosure
       states that the Debtor intends to assume all executory
       contracts while the Plan states that the Debtor intends
       to reject all executory contracts;

    6) the Debtor failed to include the monthly payments in its
       cash flow projections required under its proposed Plan;

    7) the Disclosure Statement failed to explain why the Debtor
       has fallen behind its payments to postpetition creditors;
       and proposed payments to administrative claimants should
       be shown in the Debtor's cash flow projections;

    8) the Disclosure Statement does not provide "adequate
       information" to satisfy 11 U.S.C. Section 1125(a)(1) of
       the Bankruptcy Code.

Headquartered in Clarion, Iowa, Premier Farms, is a livestock
breeder. The Company filed for protection on August 12, 2003
(Bankr. N.D. Iowa Case No. 03-04632). Donald H. Molstad, Esq., in
Sioux City, Iowa, represents the Debtor in its restructuring
efforts. When the Company filed for protection from its
creditors, it listed $22,614,949 in total assets and $93,907,881
in total debts.


PROCESS GRAPHIC: Case Summary & 20 Largest Unsecured Creditors
--------------------------------------------------------------
Debtor: Process Graphic Services, Inc.
        dba Process Engraving Co., Inc.
        PO Box 535338
        Grand Prairie, Texas 75053-5338

Bankruptcy Case No.: 04-49036

Type of Business: The Company specializes in foil stamping,
                  embossing, UV coating, and other custom
                  finishing in the printing industry.
                  See http://www.processgraphics.com/

Chapter 11 Petition Date: September 16, 2004

Court: Northern District of Texas (Ft. Worth)

Judge: D. Michael Lynn

Debtor's Counsel: St. Clair Newbern, III, Esq.
                  Law Offices of St. Clair Newbern III, P.C.
                  1701 River Run Road, Suite 1000
                  Fort Worth, Texas 76107
                  Tel: 817-870-2647

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
    ------                    ---------------       ------------
American Capital Resources    Trade Debt              $2,400,031
NW7657                        Value of Security:
1350 Energy Lane Suite 200    $654,317
St. Paul, Minnesota 55108

Orix Financial Services       Commercial Loan         $2,272,223
600 Town Park Lane
Kennesaw, Georgia 30144

IRS Special Procedures        941 Taxes               $1,250,000
Mail Code 5020DAL
1100 Commerce Street
Dallas, Texas 75242

Stevenson Family Limited      Note                      $294,000
Partnership VI
1000 Biltmore Drive
Fenton, Missouri 63026

Dallas County                 Taxes                     $105,410

Texas Workforce Commission    Taxes                      $44,137

Austell Box Board Corp.       Trade Debt                 $29,971

Tarrant County                Taxes                      $25,000

AISD                          Ad valorem taxes           $25,000

General Binding Corporation   Trade Debt                 $19,584

Crown Roll Leaf Inc           Trade Debt                 $15,401

Kelstar Enterprises, Inc.     Trade Debt                 $14,981

Harris Packaging Corporation  Trade Debt                 $12,368

Franklin Boxboard             Trade Debt                  $9,538

Sutton Frost Cary LLP         Trade Debt                  $8,500

Clampitt Paper Company        Trade Debt                  $6,980

Bron Tapes of Texas, LLC      Trade Debt                  $6,741

Printers' Service             Trade Debt                  $6,592

L.D. Davis Industries         Trade Debt                  $4,960

Plastic Suppliers             Trade Debt                  $4,791


RCN CORP: Court Sets Oct. 1 as Deadline for Filing Proofs of Claim
------------------------------------------------------------------
Judge Drain fixes October 1, 2004, 5:00 p.m. Eastern Time, as the  
deadline for filing proofs of claim against RCN Cable TV of  
Chicago, Inc., RCN Entertainment, Inc., On TV, Inc., 21st Century  
Telecom Services, Inc., and RCN Telecom Services of Virginia,  
Inc.

Governmental Units have until:

   -- February 1, 2005, to file claims against RCN Chicago; and

   -- February 16, 2005, to file claims against RCN  
      Entertainment, On TV, 21st Century, and RCN Telecom.

Headquartered in Princeton, New Jersey, RCN Corporation --  
http://www.rcn.com/-- provides bundled Telecommunications   
services.  The Company, along with its affiliates, filed for  
chapter 11 protection (Bankr. S.D.N.Y. Case No. 04-13638) on  
May 27, 2004.  Frederick D. Morris, Esq., and Jay M. Goffman,  
Esq., at Skadden Arps Slate Meagher & Flom LLP, represent the  
Debtors in their restructuring efforts.  When the Debtors filed  
for protection from their creditors, they listed $1,486,782,000 in
assets and $1,820,323,000 in liabilities. (RCN Corp. Bankruptcy
News, Issue No. 11; Bankruptcy Creditors' Service, Inc.,
215/945-7000)    


SANTA ROSA BAY: Bridge Shutdown Could Affect Fitch's BB- Rating
---------------------------------------------------------------
The Florida Department of Transportation notified Fitch Ratings
that some structural damage has been sustained at the Garcon Point
Bridge.  The Mid-Bay Bridge is open.  Toll revenues from the
bridges separately secure the revenue bonds of the Santa Rosa Bay
Bridge Authority, Florida and the Mid-Bay Bridge Authority,
Florida.  The bonds are currently rated 'BB-' (Santa Rosa) and
'BBB+/BBB' (Mid-Bay senior/junior) by Fitch.

Given the damage to infrastructure in the area and the conditions
of roads, which include a collapse of Interstate 10 lanes over
Escambia Bay and the immediate life-safety focus of emergency
services, the Transportation Department has not been able to
assess the damage at the Garcon Point Bridge.  However, the
inherent protections in the Transportation Department's lease-
purchase agreement with the Santa Rosa Bay Bridge Authority, the
Transportation Department's track record with immediately
responding and correcting structural damage, and available
property damage and loss of revenue insurance provide considerable
protection at the current rating level for the authority's revenue
bonds.

Under the lease-purchase agreement, the Transportation Department
is responsible for operations, maintenance, and renewal and
replacement on the bridges.  A few years ago, unexpectedly
advanced structural deterioration was detected at the Mid-Bay
Bridge.  The Transportation Department using its own funds
advanced the cost of the repair.  Repayment is deeply subordinated
and flexible and nonpayment is not an event of default.  The
Transportation Department has also unilaterally reimbursed the
Mid-Bay Bridge for loss of revenue when tolls were voluntarily
lifted during and following Hurricane Opal some years ago. The
agreement with Santa Rosa Bay Bridge uniquely requires the
Transportation Department to reimburse for voluntary toll-free
operation.  However, the shutdown directly related to the
hurricane would likely only be a few days and any related revenue
loss relatively small. It is the shutdown due to any potential
structural damage that would likely not be covered by the state
but instead will depend on insurance recoveries.

The limit of liability for damage to the Garcon Point Bridges is
$100 million per occurrence.  The business interruption (loss of
revenue) coverage limit is $50 million per occurrence.  
Regardless, FDOT intends to return the facilities to revenue
operation at the earliest and seek insurance recovery on a
parallel track.  Receipt of insurance recoveries is not expected
to be a constraint in completion of any required work.

The 'BB-' rating reflects the poor traffic and revenue performance
and weak financial profile of the Garcon Point Bridge.  It
incorporates the protections provided from the large debt service
reserve fund that is currently being used to bridge toll revenue
shortfalls for debt service.  Depending on the extent of damage
and the length of time the facility is shutdown, the reserve may
be further depleted than expected by Fitch when the bonds were
affirmed earlier this year, while insurance recoveries are in
process.  The reserve, which currently has about $6.3 million, can
adequately support fiscal 2005 debt service of $4.9 million and
about 25% of fiscal 2006 debt service.  Provided that there has
not been a total collapse, and the limited information to this
point does not indicate that to be the case, the reserve provides
considerable protection for repairs to be done.  It is important
to note that the competing Pensacola Bay Bridge has suffered a
partial collapse.  Furthermore, while the bridge may be repaired,
traffic levels may be suppressed for some time as the service area
recovers.


SEPRACOR INC: S&P Junks Planned $500 Mil. Convertible Senior Notes
------------------------------------------------------------------
Standard & Poor's Ratings Services assigned a 'CCC+' subordinated
debt rating to $500 million in proposed zero-coupon convertible
senior subordinated notes to be issued by specialty pharmaceutical
company Sepracor, Inc.  The amount of the notes, which are due
2024, could be increased by $100 million.  The first put date is
Oct. 15, 2009.

At the same time, Standard & Poor's affirmed its 'B' corporate
credit rating on Sepracor.

Although the new notes are senior to the company's existing
subordinated debt issues, future senior debt could be added, and
this effectively subordinates the new issue in the company's debt
structure.  Sepracor would use proceeds of the new issue for
general corporate purposes, though up to $100 million would be
used to purchase shares of company common stock.

Sepracor's pro forma debt balance, including this issue and other
recent debt conversion transactions, is projected to be roughly
$1.17 billion.

"The speculative-grade ratings on emerging specialty
pharmaceutical company Sepracor, Inc., reflect its operating
losses, which are due mainly to its significant R&D expenditures
and increasing marketing costs," said Standard & Poor's credit
analyst Arthur Wong. " The ratings also reflect Sepracor's heavy
debt burden."

These negative factors are only modestly offset by the growing
sales of Sepracor's asthma drug Xopenex, the promise of its
insomnia medication Estorra, and the adequate liquidity provided
by on-hand cash.

Marlborough, Massachusetts-based Sepracor specializes in the
development and marketing of medications to treat respiratory and
central nervous system disorders.


SPANTEL COMMS: June Working Capital Deficit Narrows to $1.8 Mil.
----------------------------------------------------------------
Spantel 2000 S.A., a telecommunications company based in Madrid,
Spain is Spantel Communications, Inc.'s operating subsidiary.
Spantel 2000 S.A. is a provider of various telecommunications
services and products within Spain; all of its operations were
established after the deregulation of the telecommunications
industry in Spain in 1998. The following comparable
analysis of the Company's operations is based on United States
Dollars. This is important because the Company's operations are
located in Spain and the value of the Euro, as compared to the
United States Dollar, has increased from the prior year.
Accordingly, if the following analysis were stated in Euros, the
percentage changes would be significantly different.

Revenues for the six months ended June 30, 2004 increased
$1,921,080, or 23.58%, to $10,068,610 from $8,147,530 for the six
months ended June 30, 2003. This increase was due primarily to the
growth of the customer base through an increase in regional
coverage, the acquisition of portfolios of telephone clients, and
the increased sales of telecommunications services through the
implementation of selling campaigns and expansion into related
businesses.

Communications expense for the six months ended June 30, 2004
increased $919,400, or 20.08%, to $5,497,537 from $4,578,137 for
the six months ended June 30, 2003. This increase was due
primarily to the expansion of the Company's business. The gross
margin (sales less communications expense) for the six months
ended June 30, 2004 increased $1,001,680, or 28.06%, to $4,571,073
from $3,569,393 for the six months ended June 30, 2003. The
increase was primarily due to the expansion of business coupled
with better pricing as a result of negotiations with major
suppliers offset by a decrease in a new business line where the
margins are currently lower.

Operating expenses for the six months ended June 30, 2004,
increased $899,318, or 31.16%, to $3,785,856 from $2,886,538 for
the six months ended June 30, 2003.  Expenses consist primarily of
marketing and selling, professional fees, and general and
administrative costs. This increase is a result of the higher
depreciation and amortization expense related to equipment
purchased during the prior year and telephone clients purchased,
temporary agency expenses to contract people for specific
campaigns, and additional general and administrative expenses from
higher mailing expenses from an increase in client base.

Net income for the six months ended June 30, 2004 was $636,549
versus $440,367 for the six months ended June 30, 2003. This
increase was primarily due to the increase of revenues and the
increase of the gross margin.

                      Plan of Operations
  
Spantel plans to internally grow its existing customer base
through the further implementation of its marketing plan. This
marketing plan features a combination of services to build
revenues both with existing and new customers.  This campaign is
designed to enhance customer service and to both entice and hold
customer loyalty. Additionally the Company is pursuing the
acquisition of similarly situated telecommunications companies, or
their clients, primarily in Spain. Such acquisitions of additional
customers will improve both revenues and the margins of the new
and the existing traffic. These acquisitions will be financed
through internal cash flow, if possible, or the raising of
additional capital through equity or debt offerings.

The Company has contracted with Uni 2, BT, among others, to
purchase telephone time.  The contracts are variable by the number
of minutes used and the point-to-point destination of the call.
Spantel has negotiated better prices and more facilities with
these suppliers, therefore it should be able to increase current
margins in cost of minutes versus revenue minutes sold.

The Company is going to continue to negotiate with its banks to
reduce the current charges and other fees charged.

                  Liquidity and Capital Resources

The Company's capital resources have been provided primarily by
capital contributions from stockholders, stockholders' loans and
the exchange of outstanding debt into Company common stock.

As of June 30, 2004, Spantel had a working capital deficit of
approximately $1,842,306 versus a working capital deficit of
$3,971,682 as of June 30, 2003.  

Management believes it will be necessary to continue to improve
this working capital position. Continuing to sustain profitable
operations and continuing to increase revenues and related margins
improves our working capital.


STELCO: Monitor Ernst & Young Files 9th CCAA Restructuring Report
-----------------------------------------------------------------
Stelco, Inc., (TSX:STE) reported that the Ninth Report of the
Monitor, Ernst & Young Inc., in the matter of the Company's Court-
supervised restructuring was filed on Friday, September 17, 2004.

The Report provides an update in such areas as financial and
operational performance, cash flow forecasts and restructuring
measures.  A number of these measures were announced by the
Company in recent months.  The full text of the Report, including
a summary of the Company's production and shipping activity during
July and August, can be accessed through a link available on
Stelco's Web site.

             UBS Securities to Assist Fund Raising

The Report references the mandate of UBS Securities Canada Inc.,
which, as announced in the Eighth Report of the Monitor, has been
engaged to provide financial advisory and investment banking
services to the Company.  The Report states that UBS, in
consultation with the Monitor will assist Stelco in conducting a
review of all possible alternatives to raise the funds required by
Stelco in connection with its restructuring.  This would include
raising the funds necessary to implement its essential capital
expenditure program.

The Report also identifies several matters in which the Company
will seek Court approval at a hearing to be held on Friday,
September 24, 2004.  These matters include the recently concluded
agreement for the sale of real property owned by CHT, a Stelco
subsidiary.

        Stelco Wants Stay Period Extended to November 26

At the same hearing the Company will seek an extension of the Stay
Period, which will otherwise expire on September 30, 2004, to the
end of November 26, 2004.  The Monitor states in its Report that
the extension is necessary for the Company to continue
negotiations with various stakeholders in order to develop a plan
of arrangement.  The Monitor also notes that an extension will
provide time for the Company to develop a process for raising
capital to address its debts and obligations, as well as to fund
its essential capital expenditure program.  The Monitor offers its
view that the extension requested is appropriate in the
circumstances and recommends that the request be granted.

Stelco, Inc., which is currently undergoing CCAA restructuring
proceedings, is a large, diversified steel producer.  Stelco is
involved in all major segments of the steel industry through its
integrated steel business, mini-mills, and manufactured products
businesses.  Consolidated net sales in 2003 were $2.7 billion.


SYNIVERSE TECH: S&P Assigns BB- Rating to $279M Credit Facility
---------------------------------------------------------------
Standard & Poor's Ratings Services assigned its 'BB-' bank loan
rating and '1' recovery rating to Tampa, Florida-based Syniverse
Technologies Inc.'s proposed $279 million senior secured bank
facility, which will consist of a $35 million revolving credit
facility (due 2006) and a $244 million term loan facility (due
2010).

"The bank loan rating, which is one notch above the corporate
credit rating, and the recovery rating reflect Standard & Poor's
expectation of full recovery of principal by lenders in the event
of a default or bankruptcy," said Standard & Poor's credit analyst
Ben Bubeck.  At the same time, Standard & Poor's revised its
outlook on the company to stable from negative, and affirmed its
'B+' corporate credit and 'B-' senior subordinated debt ratings.

Proceeds from the proposed term facility will be used to refinance
Syniverse's existing bank facility and fund the acquisition of the
North America Interoperator Services businesses (IOS NA) of
Electronic Data Systems Corporation.  This acquisition will
further strengthen Syniverse's North American market position in
technology interoperability.

The outlook revision largely is based on the revised debt maturity
schedule under the proposed new term loan, which substantially
reduces Syniverse's amortization payments.  The debt maturity
schedule under the existing facility had consumed a substantial
portion of Syniverse's cash flow and weighed negatively on the
ratings.  However, Syniverse still is expected to rapidly repay
debt under the 75% cash flow sweep provision.

The ratings reflect Syniverse's:

   * high debt levels,

   * niche position as an independent provider of wireless
     transaction processing, and

   * reliance on growth in roaming transactions in a consolidating
     wireless telecommunications market.

These partially are offset by Syniverse's recurring revenues and
good profitability, which allow for moderate free operating cash
flow generation.


TEKNI-PLEX: S&P Pares Credit Rating to B- Due to Expected Loss
--------------------------------------------------------------
Standard & Poor's Ratings Services lowered its corporate credit
rating on Tekni-Plex Inc. to 'B-' from 'B+', and placed the rating
on CreditWatch with negative implications.  This follows the
company's announcement that it expects to report a net loss for
the fiscal year ended June 30, 2004, and consequently breached
financial covenants under its credit agreement.

Coppell, Texas-based Tekni-Plex had total debt outstanding of
about $734 million at March 31, 2004.

"The downgrade reflects significant weakness in the company's
operating and financial performance, particularly during the
important final quarter of its fiscal year, and constrained
liquidity and cash generation," said Standard & Poor's credit
analyst Liley Mehta.

The CreditWatch placement reflects heightened concerns about the
company's ability to preserve sufficient liquidity in light of
weak operating results for fiscal 2004, and deterioration in the
company's already stretched and highly leveraged financial
profile.

Weaker-than-expected operating results will again contribute to
negative free cash flows that underscore the challenges faced by
Tekni-Plex with regard to its ability to make meaningful and
permanent improvements to its financial profile.

Tekni-Plex's operating performance in 2004 has been adversely
impacted by sluggish sales of garden hose products owing to
unseasonably cool and wet summer weather in the seasonally peak
fourth quarter, and significantly higher raw-material costs,
particularly polyvinyl chloride -- PVC -- resins for garden hose
products and polystyrene for its food packaging segment.  In
addition, earnings were adversely affected by lower sales of egg
cartons within the food-packaging segment in the first nine months
of fiscal 2004.  All these factors had an adverse impact on
operating profitability and resulted in very high debt leverage.

The company is currently in discussions with its bank group
regarding a waiver and amendment to the financial covenants.
Tekni-Plex's ability to obtain an amendment to its credit
agreement would be key to preserving short-term liquidity and
would add support to the 'B-' corporate credit rating.  Standard &
Poor's will monitor developments and expects to resolve the
CreditWatch listing following conclusion of the company's
discussion with lenders regarding an amendment to the credit
agreement.  Standard & Poor's will also evaluate management's
ability to improve the company's operating and financial profile,
and potential equity infusion from financial sponsors.


TEMBEC IND: Moody's Affirms Ba3 Ratings with Negative Outlook
-------------------------------------------------------------
Moody's Investors Service affirmed the Ba3 senior implied, senior
unsecured and issuer ratings of Tembec Inc.'s key operating
subsidiary, Tembec Industries, Inc.  The outlook remains negative.  
Moody's also assigned Tembec a Speculative Grade Liquidity rating
of SGL-3.  

The SGL-3 rating indicates adequate liquidity, and reflects
Tembec's recent trend of improving free cash flow combined with
cash on hand and availability under its relevant credit
facilities.  The cash flow dynamic reverses a trend that included:

   * periodic negative cash flow and, as well, reduces pressure
     from the potential of increasing capital and pension
     spending,

   * uncertainties concerning the magnitude and sustainability of
     the commodity price recovery, and

   * near term liquidity facility maturities that, in the event of
     non extension / refinance, would leave Tembec in a vulnerable
     position.  

The action is mindful of downside risks that could potentially
reverse the recent trend of sequentially improving financial
performance resulting from the ongoing commodity price recovery.

Ratings issued:

   Tembec Industries Inc.

      * Speculative Grade Liquidity Rating: SGL-3

Ratings affirmed:

   Tembec Industries, Inc.:

      * Outlook: Negative
      * Senior implied rating: Ba3
      * Issuer rating: Ba3
      * Senior unsecured notes and debentures: Ba3

Moody's views the company's sources of liquidity as being
comprised of its secured lines of credit together with cash on
hand.  Tembec's credit facility terms and conditions are generally
less restrictive than those applicable to many of its peers,
however, they are arranged for short terms.  Tembec has a good
record of being able to roll its credit facilities for successive
terms, and difficulties in the periodic roll-over and extension
process are not expected.  However, should the unexpected occur,
and should that coincide with a period of reduced commodity prices
and internally generated cash flow, Tembec could potentially find
it difficult to fund all obligations from internal sources.  In
addition to this potential vulnerability, the fact that lines of
credit are arranged as discrete facilities in various legal
entities may affect the efficient allocation of liquidity, i.e.
getting funding to the entity that needs it when it needs it.  

To date, this has not been a significant issue for Tembec.
However, Moody's generally views situations where liquidity is
compartmentalized as being sub-optimal, with the whole being less
than the sum of the parts.  As well, Moody's does not view the
positive mark-to-market value of Tembec's position of forward
exchange contracts as augmenting liquidity.  In light of these
factors, Moody's views the practical liquidity available in
support of the above-noted rated entities as somewhat less than
the C$455 million that Tembec reported as the June 30th aggregate
of unused credit facility availability, cash on hand and the
positive mark-to-market value of its forward exchange position.  
In aggregate however, and in the current context of improved
commodity prices and positive FCF, the arrangements provide
adequate liquidity.

Moody's considers Tembec's recent financial performance and credit
metrics to be weaker than those appropriate for its current Ba3
senior unsecured rating.  With the nearly three year commodity
price trough and the negative impact of duties on softwood lumber
imports to the key United States market, Tembec has not been able
to consistently generate sufficient cash flow to cover all of its
operating, capital and acquisition activities.  The company
experienced negative FCF in 2002 and 2003 and Moody's also expects
2004 to show a deficit before positive FCF is recorded in 2005.
While softwood pulp, lumber and coated paper prices have increased
from cyclical lows, and cash generation is sequentially improving,
the pulp market is now experiencing some softness, the lumber
market may be vulnerable to a near term retreat from recent highs,
and the newsprint market continues to languish.  Consequently,
there is continued uncertainty concerning the magnitude and
sustainability of the commodity price recovery.  Presuming the
recent pulp price retreat is a pause in the rally and not a
permanent impairment, expectations are for sequentially improving
cash flow over the next several quarters, implying that Tembec's
credit metrics will continue to improve and therefore substantiate
the Ba3 rating.

While there are uncertainties concerning the magnitude and
sustainability of the ongoing commodity price recovery, a near
term return to cyclical lows appears to be very unlikely.  
However, with Tembec's recent history of extremely poor
performance relative to its rating, the company's history of
making (primarily) debt financed acquisitions, of not having
repaid debt during cyclical upturns, and with the commodity price
environment continuing to include a significant proportion of
downside versus upside risks, the negative ratings' outlook
continues to be warranted.

The outlook could be returned to stable if the downside risks
related to commodity prices are addressed.  This would see the
pulp price rally re-starting, housing starts remaining strong in
support of lumber prices, and newsprint prices beginning to show
more significant improvement as well.  Over time, ratings upgrades
are not expected unless Tembec engages in material debt reduction
and implements more conservative acquisition and financial
policies. Lower ratings could result from either or both of
renewed weakness in commodity prices and debt-financed acquisition
activity that would cause Moody's to view Through-the-Cycle
RCF/Debt as being less than 10% with the commensurate FCF/Debt
being less than 5%.

Headquartered in Montreal, Tembec is an integrated manufacturer
and distributor of various grades of pulp and paper together with
forest products.


TRANSPORTATION TECH: S&P Affirms B Corporate Credit Rating
----------------------------------------------------------
Standard & Poor's Ratings Services affirmed its ratings on
Transportation Technologies Industries Inc., including the 'B'
corporate credit rating, and removed them from CreditWatch.  The
ratings were removed from CreditWatch, where they were placed on
May 5, 2004, with positive implications, because of uncertainty
surrounding the company's plans for an IPO.  The outlook is
stable.

At June 30, 2004, the Chicago, Illinois-based casting company had
total debt (including the present value of operating leases) of
$341 million.

The ratings were previously placed on CreditWatch following
[Transportation Technologies'] announcement of plans for an IPO of
common stock and the usage of proceeds to reduce debt and redeem
preferred stock.  However, the company postponed the IPO in August
due to unfavorable market conditions.  It is now unclear when or
if the company will proceed with the IPO.  "If the timing of the
IPO becomes clearer, Standard & Poor's will review the company's
financial performance and prospects for debt reduction at that
time," said Standard & Poor's credit analyst Heather Henyon.

The ratings reflect Transportation Technologies' aggressive
financial policy and below-average business-risk profile, which
are partly offset by its position as a large supplier of metal
heavy-duty and medium-duty truck parts and components to the
original equipment and after-market segments.

A heavy debt burden and exposure to the cyclical trucking market
restrict upside ratings potential.  Downside risk is limited by
Transportation Technologies':

   * liquidity,
   * leading market position,
   * competitive cost structure, and
   * prospects for recovering end markets.


UAL CORP: Settles Diana Brown-Dodson Claim for $5 Million
---------------------------------------------------------
Diana Brown-Dodson filed Claim No. 41728 against UAL Corp. and its
debtor-affiliates, asserting certain workers' compensation rights
and remedies.  The Debtors objected to Claim No. 41728, arguing
that based on their books and records, the Claim was overstated
and should be reduced.   

During negotiations, the Debtors asked Ms. Brown-Dodson to  
provide a reasonable estimate of the represent cash value of her  
Claim, solely to reduce the aggregate liabilities against the  
Debtors as reflected on the Claims Register and as a means to  
compromise and settle the Objection.

In a stipulation approved by the Court, the parties agree that a  
reasonable estimate of the present cash value of Ms. Brown-
Dodson's Claim is $5,000,000.

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. (United Airlines Bankruptcy
News, Issue No. 59; Bankruptcy Creditors' Service, Inc.,
215/945-7000)   


UNITED HERITAGE: Substantial Losses Trigger Going Concern Doubt
---------------------------------------------------------------
United Heritage Corporation is an independent producer of natural
gas and crude oil based in Cleburne, Texas. The Company produces
from properties it leases in Texas and New Mexico. The Company
acquired its Texas property, which includes 114 wells, in February
1997 and its New Mexico property, which includes 294 wells, in
June 1999. Its plan has been to develop these properties by
reworking many of the existing wells and drilling additional
wells, however the Company's revenues from operations, even used
in conjunction with loans obtained, do not provide the Company
with enough money to implement its business plan.

                      Auditors Express Doubts

The consolidated financial statements of United Heritage
Corporation have been prepared on a going concern basis, which
contemplates realization of assets and liquidation of liabilities
in the ordinary course of business. The Company has incurred
substantial losses from operations and has a working capital
deficit. The appropriateness of using the going concern basis is
dependent upon the Company's ability to retain existing financing
and to achieve profitable operations. These conditions raise
substantial doubt about the Company's ability to continue as a
going concern.

The Company has raised $1,700,000 in recent months from the
private placement of common stock and the issuance of promissory
notes, which were converted to common stock during June 2004.
Management of the Company continues to explore other methods of
financing operations including additional borrowing from a related
party financing company, potential joint venture partners and
selling portions or all of certain properties and/or subsidiary
companies. The Company expects that these actions will allow it to
continue and eventually achieve its business plan.

On July 12, 2004, the Company entered into a letter of intent with
Imperial Petroleum, Inc. Pursuant to the letter of intent, Jeffrey
T. Wilson, President of Imperial Petroleum, Inc. (or his
designees), will purchase 13,188,834 shares of Company common
stock for a purchase price of $0.75 per share. 7,855,500 of these
shares will be purchased, collectively, from the Company's
President, Walter G. Mize, and from Christian Heritage Foundation.
The remaining shares will be purchased directly from United
Heritage Corporation. Subsequent to the stock purchase, Imperial
Petroleum, Inc. will be merged into United Heritage
Corporation, with each stockholder of Imperial Petroleum, Inc.
receiving one share of United Heritage Corporation common stock
for three shares of Imperial Petroleum, Inc. common stock. In
conjunction with the merger, National Heritage Sales Corporation
may be spun-off to stockholders who are of record prior to Mr.
Wilson's acquisition of the Company's common stock. There is no
guarantee that this merger will take place because the letter of
intent states that it is not binding, that the transaction
contemplated in it must be approved by the Boards of Directors and
the stockholders of each of the signatories and is subject to
regulatory, tax and accounting considerations and appropriate
investigations by each of the parties.

United Heritage had a working capital deficit of $2,945,932 as of
June 30, 2004, an increase of $437,234 as compared to the working
capital deficit reported at March 31, 2004 of $2,508,698. Current
assets decreased $326,222 during the three-month period ended June
30, 2004 due primarily to expenditures on oil and gas properties
of $375,900. Current liabilities increased by $111,012 due to
increased accounts payable and accrued expenses resulting from the
lack of operating cash flows.

The Company's total assets were $31,694,307 as of June 30, 2004,
which is substantially unchanged from total assets of $31,662,597
reported at March 31, 2004.

The Company is engaged in the distribution of meat products
primarily on the US west coast through a wholly owned subsidiary,
National Heritage Sales Corporation (National).


W.R. GRACE: Settles Honeywell Litigation for $62.5 Million
----------------------------------------------------------
W.R. Grace & Co. (NYSE:GRA), subject to Bankruptcy Court approval,
settled its litigation with Honeywell International, Inc.,
concerning contamination of Grace owned property at Route 440 in
Jersey City, New Jersey.  Under the terms of the settlement, Grace
will transfer the Route 440 property to Honeywell.  Honeywell will
fully indemnify Grace and pay Grace $62.5 million.

The Route 440 property, approximately 32 acres, was acquired by a
Grace subsidiary in 1981.  Unbeknownst to Grace at the time, the
Route 440 property was contaminated with approximately 1.5 million
tons of chromium waste from a chromium manufacturing facility
(owned by a Honeywell predecessor), which had closed in 1954.  
Grace sued Honeywell in Federal Court in Newark, New Jersey for
damages and for an injunction ordering Honeywell to remove the
chrome waste and backfill with clean fill.

In May 2003, a Federal Judge decided in favor of Grace.  Honeywell
has appealed this decision.  The settlement will end Grace's
involvement in any litigation related to the Route 440 property.

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.


WEST PENN: Operational Progress Spurs Fitch to Affirm B+ Rating
---------------------------------------------------------------
Fitch affirmed its underlying 'B+' rating and revised its Outlook
to Stable from Negative on the approximately $75.6 million
Allegheny County Hospital Development Authority Health System
revenue bonds, series 2000A (West Penn Allegheny Health System)
and the $353.9 million Allegheny County Hospital Development
Authority Health System revenue bonds, series 2000B (West Penn
Allegheny Health System).  The series 2000A bonds are rated 'AAA'
based on bond insurance provided by MBIA, whose financial insurer
strength is rated 'AAA' by Fitch.

The 'B+' affirmation is based on West Penn Allegheny Health
System's operational improvements in fiscal 2004, liquidity ratios
given this rating category, and steady market position.  
Operations improved significantly in fiscal 2004 with an operating
loss of just $541,000 versus a loss of $47.245 million in 2003.  
Excess income was positive in 2004 with the system posting a
$19.4 million bottom line. Debt service coverage improved to 1.9
times (x) in 2004 from 1.3x in 2003.  West Penn Allegheny's
liquidity continues to remain adequate for the rating category at
60 days.  Other liquidity measures have remained stable as well,
with a cushion ratio at 2.7x and unrestricted cash to debt at
almost 30%.  West Penn Allegheny's market position is relatively
stable in the defined six-county primary service area with a 20%
market share but still remains a distant second to UPMC Health
System (32.6%), whose bonds are rated 'A' by Fitch.  

Fitch believes West Penn Allegheny is beginning to show signs of
improved financial performance that should be sustainable. Fitch
expects physical plant investment to improve, liquidity to be
stable, and debt service coverage to be adequate and stable.

Fitch's concerns continue to be West Penn Allegheny's:

   * high capital needs,
   * large debt burden,
   * rising supply and drug expenses, and
   * large losses from employed physicians.

West Penn Allegheny improved its operating results in fiscal 2004
to almost breakeven.  The 2005 budget forecasts continued
improvement.  Excess before interest, taxes, depreciation, and
amortization (EBITDA) growth has been solid with EBITDA growing
from approximately $96 million (7.9%) in 2003 (including the
$25 million from Highmark) to over $135 million in 2004 (10.4%).

West Penn Allegheny's leverage indicators are also a concern with
MADS as a percentage of revenues and debt to EBITDA at 5.6% and
4.8%, respectively, through June 30, 2004.  Similar to other
health systems across the country, West Penn Allegheny has
experienced significant increases in expenses, particularly labor,
supply, and insurance.  Additionally, West Penn Allegheny has a
significant accrued pension liability of $131.7 million, although
this is down from $152.5 million in 2003.  West Penn Allegheny's
currently employs approximately 370 physicians.  Losses on
employed physicians, while declining, remain high at approximately
$27.5 million or approximately $74,000 per physician.

The Stable Outlook reflects West Penn Allegheny's financial
improvement in 2004 and expectation that fiscal 2005 will continue
to improve.  Fitch expects liquidity over the near term to be
stable due to WPAHS' significant capital needs.

Headquartered in Pittsburgh, Pennsylvania, West Penn Allegheny is
a large primary and tertiary health system with six hospitals
(1,842 total staffed beds) and other related entities that
primarily serve Allegheny County and its five surrounding
counties.  West Penn Allegheny's flagships are 698-licensed bed
Allegheny General Hospital and the 512-licensed bed Western
Pennsylvania Hospital.  Total revenues in fiscal 2002 were
approximately $1.3 billion.  Disclosure to Fitch and to
bondholders has been provided on a quarterly basis and has been
excellent in terms of timeliness and content.


WISE WOOD: Selling Remaining Downhole Services Assets for $850,000
------------------------------------------------------------------
Fred Moore, President and CEO of Wise Wood Corporation reported
the sale of the EnerCore facility, which were the remaining assets
of the Company's Downhole Services Division.  The transaction
involved the sale of the Enercore machinery, equipment and other
operating assets for $450,000 and a separate sale of the lands and
building located in Stettler, Alberta for an additional $400,000
resulting in an overall price of $850,000 for this facilty.

The Enercore facility was originally purchased by Wise Wood from
Enerliner Restorations Inc., in October 2002.  This facility
provided the installation of polyethylene liners into production
tubing with polymer liners for wear and corrosion control.  In a
continued effort to improve the Company's financial performance
and working capital requirements, management concluded that the
disposition of the remaining assets of the Downhole division for
the purchase price and terms offered by the purchasers was in the
Company's best interests at this time.

Wise Wood Corporation provides oil and gas companies with de-
coking and de-scaling services through its Joint Venture
operations with Innovative Coke Expulsion Inc.  In its most recent
financial statements dated June 30, 2004 Wise Wood generated
revenue of $5.23 million and net income of $0.24 million.

The Company is incorporated under the Alberta Business
Corporations Act. The Company became a public company on Dec. 2,
2001, and was then classified as a Capital Pool Company -- CPC
-- as defined in Policy 2.4 of the TSX Venture Exchange.  
Effective with its Qualifying Transaction on May 3, 2002. the
Company ceased to be a CPC.

On May 20, 2003 the Company changed its name from Wise Wood Energy
Ltd. to Wise Wood Corporation.

                         *     *     *

Wise Wood Corporation's June 30, 2004 financial report indicated
that Wise Wood incurred substantial losses since its inception
and, despite an improvement in cash flows during fiscal 2004, had
a substantial working capital deficiency at June 30, 2004 and was
in violation of certain of its financial covenants with its
banker.  The ability of the Company to continue as a going concern
is dependent on the success of future operations and the
continuing support of its lenders, other creditors and
shareholders.


WORLDCOM: New York Times Says MCI Is Looking for Buyers
-------------------------------------------------------
Andrew Ross Sorkin and Ken Belson, writing for The New York Times,
report that MCI is "quietly begun shopping itself to potential
buyers," citing executives involved in the sale process as their
source.  

Messrs. Sorkin and Belson report that MCI has hired:

    * Lazard,
    * Greenhill & Company,
    * J. P. Morgan Chase, and
    * Davis Polk & Wardwell,

for investment banking and legal advice.  

The unnamed executives tell the reporters that MCI might be sold
as a whole or split into parts -- separating business services
from consumer services.  The target price is $6 billion.  Verizon
Communications, SBC Communications, BellSouth and Qwest
Communications are seen as likely buyers for MCI's corporate
services business, as well as Electronic Data Systems and I.B.M.  
The executives think MCI's consumer business might wind-up in the
hands of a private equity firm drawn by the (steadily declining)
cash flows.  Leucadia has already sought approval from the Federal
Trade Commission and the Justice Department to acquire at least
half of MCI's common shares.  Currently, Leucadia holds about a 5%
equity stake.

Headquartered in Clinton, Mississippi, WorldCom, Inc., now known
as MCI -- http://www.worldcom.com/-- is a pre-eminent global  
communications provider, operating in more than 65 countries and
maintaining one of the most expansive IP networks in the world.

The Company filed for chapter 11 protection on July 21, 2002
(Bankr. S.D.N.Y. Case No. 02-13532). On March 31, 2002, the
Debtors listed $103,803,000,000 in assets and $45,897,000,000 in
debts. The Bankruptcy Court confirmed WorldCom's Plan on
October 31, 2003, and on April 20, 2004, the company formally
emerged from U.S. Chapter 11 protection as MCI, Inc.


WORLDCOM INC: Judge Gonzalez Approves ERISA Settlement Agreement
----------------------------------------------------------------
Mark A. Jacoby, Esq., at Weil, Gotshal & Manges, LLP, in New York,
relates that during the Chapter 11 cases, proofs of claim were
filed against the WorldCom, Inc. and its debtor-affiliates by:

   -- the Named Plaintiffs and other potential members of the
      Settlement Class with respect to the same claims asserted
      in the ERISA Action;

   -- the U.S. Department of Labor for possible violations of the
      fiduciary requirements of ERISA with respect to the 401(k)
      Plans;

   -- a number of former officers, directors and employees for
      indemnification claims under the Debtors' corporate bylaws
      and articles of incorporation in connection with the ERISA
      Action and any losses incurred on account thereof; and

   -- Merrill Lynch Trust Company, F.S.B. asserting a contractual
      claim for indemnification in connection with the claims
      asserted against Merrill Lynch in the ERISA Action.

The Debtors argued that the claims in the ERISA Action were not
meritorious, but even if allowed, the claims would be subject to
subordination under Section 510(b) of the Bankruptcy Code.  The
Named Plaintiffs asserted that the ERISA claims would not be
subject to subordination and instead were general unsecured
claims.  The Named Plaintiffs estimated the amount of the claim
for damages in the ERISA Action to be in the range of
$150,000,000 to $600,000,000.

                          The Settlement

The Named Plaintiffs, the Debtors and certain other defendants in
the ERISA Action participated in an intense, arm's-length
mediation process supervised by Magistrate Judge Michael Dolinger,
the District Court-appointed mediator.  As a result of the
mediation, the Debtors and certain ERISA Defendants negotiated an
agreement in principle with the Named Plaintiffs to settle the
issues raised in the ERISA Action.  The parties document that
agreement on July 2, 2004.

The Named Plaintiffs sought a preliminary approval of the
Settlement Agreement from the District Court, seeking to certify
the Settlement Class as a mandatory non-opt out class.  The
District Court entered the Preliminary Approval Order on July 21,
2004.

Pursuant to the terms of the Preliminary Approval Order, notices
of class certification and claims bar order are to be transmitted
to the members of the Settlement Class and other persons and
entities by August 6, 2004.  The District Court will conduct a
fairness hearing on October 15, 2004 at 2:00 p.m. to consider the
Settlement Agreement.

                          *     *     *

Merrill Lynch Trust Company FSB complains that the ERISA Class
Action Settlement Agreement, the proposed Bar Order and related
judgment credit formulae proposed by the Settling Parties is
improper.

Paul Blankenstein, Esq., at Gibson, Dunn & Crutcher, LLP, in
Washington, D.C., tells Judge Gonzalez that the Proposed Bar
Order will preclude Merrill Lynch from pursuing any other claim
against the Settling Defendants relating to the case.  Merrill
Lynch will not be able to pursue its separate claim for
contractual indemnification against the Debtors, stemming from its
agreement to provide directed trustee services to the 401(k) plan.

In January 23, 2003, Merrill Lynch filed Claim No. 28010 against
the Debtors.  Merrill Lynch seeks to recover damages and expenses
in the ERISA Action pursuant to WorldCom's indemnity obligations
under a Trust Agreement and a Servicing Agreement, both dated
October 10, 1994, between the parties.

Merrill Lynch is a non-settling party with respect to the
Settlement Agreement.

Merrill Lunch has filed an objection to the Settlement Agreement
before the United States District Court for the Southern District
of New York.  The District Court is scheduled to conduct a
fairness hearing on October 15, 2004, to consider final approval
of the Settlement Agreement and rule on Merrill Lynch's objection.

In the Objection, Merrill Lynch points out that the Proposed Bar
Order provides that "any judgments entered against" Merrill Lynch
will be reduced by the "Judgment Reduction Amount."  The
Settlement Agreement defines Judgment Reduction Amount as the
greatest of:

   (a) the $51,150,000 gross amount of the Settlement, less any
       portion that the District Court determines to have been
       paid with respect to damages separate from those which the
       barred person is liable;

   (b) the amount of any insurance coverage that the District
       Court determines would have been available to the barred
       person but for the Bar Order;

   (c) the value of any contribution or equitable indemnification
       claim the District Court determines the barred person
       would have been entitled to assert but for the Bar Order,
       equal to the proportionate shares of liability, if any, of
       the Settling Defendants; and

   (d) the value of any contractual indemnification claim the
       District Court determines the barred person would have
       been entitled to assert but for the Bar Order.

The Bar Order and related Judgment Reduction Amount improperly
attempt to compromise Merrill Lynch's rights in four ways:

   (1) In exchange for being forced to surrender its equitable
       indemnity and contribution rights, Merrill Lynch is
       entitled by law to a settlement credit that is equal to
       the Settling Defendants' proportionate share of the common
       liability, as in that way Merrill Lynch would pay no more
       than its equitable share of any judgment.  But by
       conditioning the amount of that credit "in light of the
       financial capability" of the Settling Defendants to pay,
       the Settling Parties would establish a regime that might
       well cause Merrill Lynch to pay more than its fair share;

   (2) The Proposed Bar Order and Judgment Reduction Amount
       commandeer for the benefit of the Settling Defendants
       Merrill Lynch's contractual right to obtain indemnity from
       WorldCom.  That right exists separate and apart from the
       allocation of equitable responsibility among liable
       Parties;

   (3) Because Merrill Lynch's contractual right to indemnity
       falls outside the equitable allocation of culpability
       among the Defendants, it cannot be subjected to any bar
       order.  The Settling Parties try to skirt the problem by
       giving Merrill Lynch a judgment reduction credit equal to
       the value of that contractual indemnification right.  But
       even if the proposed Judgment Reduction Amount is modified
       so that the indemnification credit is added to the
       equitable settlement credit, the relief would be
       insufficient.  If Merrill Lynch prevails against the
       Plaintiffs, there would be no adverse judgment that the
       contractual indemnification credit could be used to
       offset.  While Merrill Lynch is entitled by its contract
       to recover from WorldCom the fees and other expenses it
       incurred in that successful defense, the Proposed Bar
       Order would deny Merrill Lynch that right; and

   (4) The Proposed Bar Order is not mutual.  Although the
       Settling Defendants' proposal would preclude Merrill Lynch
       from pursuing any claims against them relating to the
       Class Action, they have reserved the right to sue Merrill
       Lynch on the very claims that they want barred.

Mr. Blankenstein tells Judge Gonzalez that the Debtors' request do
not purport to rule on or affect the determination by the District
Court of Merrill Lynch's Objection and do not limit the remedies
or orders the District Court might issue in ruling on the
Objection.  Should the Debtors' request be approved, Mr.
Blankenstein suggests that the Bankruptcy Court clarify that
Merrill Lynch and other parties are not barred from objecting to
the Settlement Agreement and the Proposed Bar Order before the
District Court.  Approval of the Debtors' request should not
restrict or limit the rulings the District Court may issue on the
proposed Final Order approving the Settlement Agreement and
Merrill Lynch's Objection.

Mr. Blankenstein asks Judge Gonzalez to include this provision in
any Bankruptcy Court order approving the Debtors' request:

   "Nothing contained herein shall affect, limit, or be construed  
   to affect or limit, (i) the jurisdiction of the District Court     
   over the Settlement Agreement, the Bar Order, and matters and
   disputes in connection therewith, as set forth in the
   Settlement Agreement, (ii) the determination and rulings of
   the District Court on the Final Order, the Settlement
   Agreement, and on any objections thereto, including the
   Merrill Objection, or (iii) the granting or withholding of
   relief or remedies by the District Court in connection with
   the foregoing."

                          *     *     *

Judge Gonzalez approves the terms of the ERISA Settlement
Agreement, subject to entry of the Final Order by the U.S.
District Court for the Southern District of New York and the
occurrence of the Effective Date of the Settlement.

Judge Gonzalez further rules that:

   (a) All claims of the Named Plaintiffs and members of the
       Settlement Class arising under the ERISA Action or
       otherwise subject to the Settlement are resolved pursuant
       to the terms of the Settlement Agreement and the Final
       Order entered by the District Court approving the
       Settlement Agreement.  In the event that the Settlement
       Agreement is terminated:

          (1) The claims will revert to their status as of the
              day immediately before execution of the Agreement;

          (2) The time by which the Debtors may file objections
              to claims related to the ERISA Action will be
              extended 75 days from the Effective Termination
              Date, other than with respect to the claims filed
              by the Named Plaintiffs; and

          (3) The Debtors will file a preliminary objection to
              the claims of the Named Plaintiffs within 30 days
              after the Effective Termination Date and a request
              for a scheduling conference;

   (b) Pending Final approval of the Settlement Agreement, the
       Debtors' deadline to file objections to these parties'
       claims is extended through and including January 17, 2005:

          * Named Plaintiffs,

          * Members of the Settlement Class,

          * The Non-Settling Parties,

          * The U.S. Department of Labor, and

          * Any other persons subject to the Bar Order pursuant
            to the terms of the Settlement Agreement;

   (c) If the Settlement Agreement is terminated pursuant to its
       terms prior to January 17, 2005, the Debtors will file a
       preliminary objection to the Named Plaintiffs' claims
       within 30 days after the Effective Termination Date and a
       request for a scheduling conference;

   (d) The Debtors may ask the Bankruptcy Court for further or
       other extensions of the time to object to any claims; and

   (e) Nothing in the Bankruptcy Court Order will affect, limit,
       or be construed to affect or limit:

          (1) the jurisdiction of the District Court over the
              Settlement Agreement, the Bar Order, and related
              matters and disputes;

          (2) the determination and rulings of the District Court
              on the Final Order, the Settlement Agreement, and
              on any objections, including the Merrill Lynch
              Objection; or

          (3) the granting or withholding of protection or
              remedies by the District Court.

Headquartered in Clinton, Mississippi, WorldCom, Inc., now known
as MCI -- http://www.worldcom.com/-- is a pre-eminent global
communications provider, operating in more than 65 countries and
maintaining one of the most expansive IP networks in the world.
The Company filed for chapter 11 protection on July 21, 2002
(Bankr. S.D.N.Y. Case No. 02-13532). On March 31, 2002, the
Debtors listed $103,803,000,000 in assets and $45,897,000,000 in
debts. The Bankruptcy Court confirmed WorldCom's Plan on October
31, 2003, and on April 20, 2004, the company formally emerged from
U.S. Chapter 11 protection as MCI, Inc. (Worldcom Bankruptcy News,
Issue No. 61; Bankruptcy Creditors' Service, Inc., 215/945-7000)


* Saber Partners Appoints Two Attorneys to Advisory Board
---------------------------------------------------------
Stuart Eizenstat, a former senior official in the Departments of
State and Treasury during the Clinton Administration, and Robert
W. Gee, the former Chairman of the Public Utility Commission of
Texas, have joined the Saber Partners, LLC's Advisory Board.
Thomas F. Best, a lawyer with extensive experience representing
regulatory agencies in Texas and practicing administrative law,
has also joined the firm as Managing Director and General Counsel.

Mr. Eizenstat served as Deputy Treasury Secretary, Under Secretary
of State for Economic, Business and Agricultural Affairs and Under
Secretary of Commerce for International Trade. He was Ambassador
to the European Union from 1993 to 1996.

Currently a partner with the law firm Covington and Burling, Mr.
Eizenstat is focused on international business transactions and
other international trade-related issues.

Mr. Gee is also a former Assistant Secretary of the U.S.
Department of Energy in Policy and International Affairs and
Fossil Energy.

"Stuart Eizenstat comes to us with a long and distinguished track
record of public service spanning decades," said Joseph S.
Fichera, CEO of Saber Partners, LLC. "He is widely recognized for
both his integrity and his independence and I have known him
personally for over 25 years and always regretted that my business
commitments at the time didn't allow me to accept a position
working for him while he was at the State Department."

"Bob Gee has worked on regulatory and energy matters from both the
state and federal perspective. His dedication, commitment and
integrity has permitted him to always find innovative ways for the
private sector and government to work in the public interest," Mr.
Fichera continued. "We are honored that Stu and Bob have agreed to
join our Advisory Board."

Saber Partners' independent advisory board is chaired by Alan S.
Blinder, a former Vice Chairman of the Federal Reserve and Member
of the President's Council of Economic Advisors.

Mr. Best will oversee legal and research and analysis for Saber
Partners and its clients. He replaces Christopher Bosland, who
left Saber Partners to accept an appointment by President Bush to
be the advisor to the Chairman of the Federal Housing Finance
Board.

"Tom Best brings a wealth of regulatory experience to Saber
Partners, and his thoughtful approach to problem solving
complements his strong legal background," Mr. Fichera said. "We
are delighted to have him on our team."

Mr. Best served as Assistant General Counsel for the Texas Public
Utility Commission where he represented the State in connection
with a wide range of regulatory and financial matters. He also
served as the Legal Director of the Commission's Policy Division
where he advised commissioners appointed by the Governor on legal
and policy matters related to the restructuring of the Texas
retail electricity market. Most recently, Mr. Best served as
General Counsel for the Texas Commission on Alcohol and Drug
Abuse.

"Saber Partners' commitment to the integrity and fairness of
markets is evident in the firm's recent work for public sector
clients," Mr. Best said. "I am pleased to have the opportunity to
work with a firm that has made restoration of the public trust in
the capital markets a top priority."

Mr. Best began his legal career representing financial
institutions in negotiations and conducting litigation concerning
accounting rules and regulation. After working as an attorney for
the Texas State Senate, he established a successful private legal
practice in Austin, Texas representing a variety of private sector
clients concerning their interaction with state government.

Saber Partners, LLC -- http://www.saberpartners.com/-- is a full-
service financial advisory firm providing strategic support to a
broad range of corporate and public sector clients.

Since the firm's creation in September 2000, Saber Partners has
set itself apart as an innovator in the realm of banking and
finance. The firm is known for taking bold action and achieving
significant results on behalf of a roster of clients that includes
ExxonMobil Corporation, the Office of the Governor of the State of
California, the Public Utility Commission of Texas, the Board of
Public Utilities of New Jersey and an agent of the State of
Vermont, as well as for other corporations interested in
financings, mergers or acquisitions.

Most recently, the Securities & Exchange Commission engaged Saber
Partners as an expert adviser.


* Large Companies with Insolvent Balance Sheets
-----------------------------------------------  
                                Total  
                                Shareholders  Total     Working  
                                Equity        Assets    Capital  
Company                 Ticker  ($MM)          ($MM)     ($MM)  
-------                 ------  ------------  -------  --------  
Airgate PCS Inc.        CSA         (89)         270        9
Akamai Tech.            AKAM       (157)         190       55
Alaska Comm. Syst.      ALSK        (12)         650       85
Alliance Imaging        AIQ         (50)         640       27
Amazon.com              AMZN       (791)       1,888      645
AMR Corp.               AMR        (122)      30,001   (1,784)  
Amylin Pharm. Inc.      AMLN        (10)         429      357
Atherogenics Inc.       AGIX         (1)         106       94
Blount International    BLT        (382)         420      (55)
CableVision System      CVC      (1,546)      11,141     (489)
Cell Therapeutic        CTIC        (65)         162       72
Centennial Comm         CYCL       (547)       1,540       13  
Charter Comm            CHTR        (29)      20,519     (810)
Choice Hotels           CHH        (175)         267      (25)  
Cincinnati Bell         CBB        (615)       2,022      (17)
Compass Minerals        CMP        (132)         647      111
Cubist Pharmacy         CBST        (58)         172       42
Delta Air Lines         DAL      (2,671)      24,175   (2,273)
Deluxe Corp             DLX        (251)       1,531     (987)  
Domino Pizza            DPZ        (677)         449      (33)
Echostar Comm           DISH     (1,740)       6,037      639  
Graftech International  GTI         (30)       1,036      294  
Hawaian Holdings        HA         (160)         236      (60)
Idenix Pharm.           IDIX         (1)          77       42
Imax Corporation        IMAX        (51)         215        9
Indevus Pharm.          IDEV        (34)         205      164
Inex Pharm.             IEX          (2)          66       40
Kinetic Concepts        KCI         (77)         616      201  
Lodgenet Entertainment  LNET       (133)         273       (8)
Lucent Tech. Inc.       LU       (3,064)      15,970    2,472
Maxxam Inc.             MXM        (629)       1,040       96
McDermott Int'l         MDR        (361)       1,246      (34)
McMoRan Exploration     MMR         (78)         163       49
Memberworks Inc.        MBRS        (46)         453      (11)
Millennium Chem.        MCH         (47)       2,331      580
Northwest Airlines      NWAC     (2,172)      14,391     (290)  
Nextel Partner          NXTP        (19)       1,855      261
ON Semiconductor        ONNN       (315)       1,262      254
Per-se Tech. Inc.       PSTI        (34)         157       43
Phosphate Res.          PLP        (439)         316        5
Qwest Communication     Q        (1,909)      25,106     (555)
Rightnow Tech.          RNOW        (12)          38       (9)
SBA Comm. Corp.         SBAC        (19)         934        5
Sepracor Inc            SEPR       (669)         718      393  
St. John Knits Int'l    SJKI        (57)         206       77
UST Inc.                UST         (36)       1,590      518
Valence Tech.           VLNC        (57)          16       (3)
Vector Group Ltd.       VGR         (41)         552      105
WR Grace & Co.          GRA        (169)       2,987      750
Western Wireless        WWCA       (142)       2,665        1
Young Broadcast         YBTVA        (1)         799       89

                           *********

Monday's edition of the TCR delivers a list of indicative prices
for bond issues that reportedly trade well below par.  Prices are
obtained by TCR editors from a variety of outside sources during
the prior week we think are reliable.  Those sources may not,
however, be complete or accurate.  The Monday Bond Pricing table
is compiled on the Friday prior to publication.  Prices reported
are not intended to reflect actual trades.  Prices for actual
trades are probably different.  Our objective is to share
information, not make markets in publicly traded securities.
Nothing in the TCR constitutes an offer or solicitation to buy or
sell any security of any kind.  It is likely that some entity
affiliated with a TCR editor holds some position in the issuers'
public debt and equity securities about which we report.

Each Tuesday edition of the TCR contains a list of companies with
insolvent balance sheets whose shares trade higher than $3 per
share in public markets.  At first glance, this list may look like
the definitive compilation of stocks that are ideal to sell short.  
Don't be fooled.  Assets, for example, reported at historical cost
net of depreciation may understate the true value of a firm's
assets.  A company may establish reserves on its balance sheet for
liabilities that may never materialize.  The prices at which
equity securities trade in public market are determined by more
than a balance sheet solvency test.

A list of Meetings, Conferences and Seminars appears in each
Wednesday's edition of the TCR. Submissions about insolvency-
related conferences are encouraged. Send announcements to
conferences@bankrupt.com.

Each Friday's edition of the TCR includes a review about a book of
interest to troubled company professionals. All titles are
available at your local bookstore or through Amazon.com. Go to
http://www.bankrupt.com/books/to order any title today.

Monthly Operating Reports are summarized in every Saturday edition
of the TCR.

For copies of court documents filed in the District of Delaware,
please contact Vito at Parcels, Inc., at 302-658-9911. For
bankruptcy documents filed in cases pending outside the District
of Delaware, contact Ken Troubh at Nationwide Research &
Consulting at 207/791-2852.

                          *********

S U B S C R I P T I O N   I N F O R M A T I O N

Troubled Company Reporter is a daily newsletter co-published by  
Bankruptcy Creditors' Service, Inc., Fairless Hills, Pennsylvania,  
USA, and Beard Group, Inc., Frederick, Maryland USA. Yvonne L.  
Metzler, Emi Rose S.R. Parcon, Rizande B. Delos Santos, Jazel P.
Laureno, Cherry Soriano-Baaclo, Marjorie Sabijon, Terence Patrick
F. Casquejo and Peter A. Chapman, Editors.

Copyright 2004.  All rights reserved.  ISSN: 1520-9474.

This material is copyrighted and any commercial use, resale or
publication in any form (including e-mail forwarding, electronic
re-mailing and photocopying) is strictly prohibited without prior
written permission of the publishers.  Information contained
herein is obtained from sources believed to be reliable, but is
not guaranteed.

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

                *** End of Transmission ***