TCR_Public/041108.mbx       T R O U B L E D   C O M P A N Y   R E P O R T E R

          Monday, November 8, 2004, Vol. 8, No. 244

                          Headlines

A.B. DICK: Presstek Completes Purchase & Expands Loan to $80 Mil.
AIR CANADA: Reports Record 77.7% October System Load Factor
AIRCAST INTERNATIONAL: Moody's Assigns Single-B Rating to Loans
AIRGAS INC: S&P Lifts Rating One Notch to BB+
ALLEGHENY ENERGY: Third Quarter Net Loss Widens to $376.8 Million

ALLEGHENY ENERGY: S&P Places B Rating on $1 Bil. Sr. Sec. Facility
AMKOR TECHNOLOGY: Moody's Says Liquidity Has Improved
AMRESCO: Moody's Junks Three Classes & Rates Two Classes Low-B
ARMSTRONG HOLDINGS: Sept. 30 Balance Sheet Upside-Down by $1 Bil.
ATA AIRLINES: Asks Court to Fix December 26 as Claims Bar Date

ATA AIRLINES: Denver & SFO Airports Balks at Cash Collateral Use
BALLY TOTAL: Moody's Reviewing Single-B & Junk Ratings
BEAR STEARNS: Fitch Puts Low-B Ratings on Six Certificate Classes
BELL CANADA: Third Quarter Revenue Up 3.3 Percent to $4.8 Billion
BERKLINE/BENCHCRAFT: Moody's Affirms Single-B Ratings on Loans

BEXAR COUNTY: Moody's Slices Sub. Revenue Bond Rating to Ba2
BIOPHARMA ROYALTY: S&P Junks Sr. Notes Due to Low Royalty Revenues
BRIDGEPOINT TECH: U.S. Trustee Picks 4-Member Creditors Committee
CALPINE CORP: Posts $22.3 Million of Net Income in Third Quarter
CATHOLIC CHURCH: Portland's First Interim Chapter 11 Report

CATHOLIC CHURCH: Judge Perris Extends Portland's Exclusive Periods
CHAPCO CARTON: Creditors Must File Proofs of Claims by Nov. 15
CHARTER COMMS: Sept. 30 Stockholders' Deficit Narrows to $4 Mil.
CLARK GROUP: Confirmation Hearing Set for November 10
CLARK GROUP: Wants to Hire Summers Compton as Bankruptcy Counsel

CLEARLY CANADIAN: Inks C$1.5 Million Secured Loan with Global
COMFORCE CORP: Sept. 30 Balance Sheet Upside-Down by $37.5 Million
COMM 2004-RS1: Fitch Puts Low-B Ratings on Six Securities Classes
CONCERT INDUSTRIES: Files CCAA Plan of Arrangement in Montreal
CONMED CORP: S&P Assigns B Rating to $125 Mil. Convertible Notes

CROWN CASTLE: Buys Verizon's Interest in Crown Atlantic for $295MM
DANKA BUSINESS: Sept. 30 Balance Sheet Upside-Down by $73.9 Mil.
DELTA AIR: $252 Million of Pass Through Certificates Tendered
DELTA FUNDING: Fitch Junks Class B & Cuts Class M-2's Rating to B
DIAMOND K CORP.: Case Summary & 22 Largest Unsecured Creditors

DIGITALNET: Moody's Withdraws Low-B Ratings After BAE Acquisition
DIVERSIFIED ASSET: Fitch Slices Class B-1 Notes' Rating to B
DT INDUSTRIES: Wants Plan-Filing Period Stretched to March 8
DYNACQ HEALTHCARE: Restructures Bank Loan & Cures Default
EMISPHERE TECH: Sept. 30 Stockholders' Deficit Narrows to $4.1-Mil

ENRON CORP: Court Approves Settlement Agreement with Accord Energy
ENRON CORP: Court Allows $6.75 Million Claim Against NEGT Power
ENRON CORP: AEP Completes $115 Million Bammel Asset Purchase
FAO, INC.: Who Recovers What Under the Liquidating Plan
FOSTER WHEELER: Saybrook Completes Out-of-Court Restructuring

FRANKLIN CAPITAL: Raises $3,245,000 in Private Equity Placement
GADZOOKS INC: October Same Store Sales Up 14.1% from Last Year
GENOIL INC: Acquires Majority Interest in Velox Corporation
GITTO GLOBAL: Inks Sale Pact with Unidentified Horse Bidder
GOODYEAR TIRE: Appoints Joseph Copeland Sr. Vice President

GRANITE INC: Voluntary Chapter 11 Case Summary
GREATER FELLOWSHIP: Case Summary & 16 Largest Unsecured Creditors
HARVEST ENERGY: Increases Share Exchange Ratio to 1.05604
HEALTH CARE: Fitch Explains BB+ Preferred Stock Rating in Detail
HORNBECK OFFSHORE: Launches Cash Tender Offer for 10-5/8% Notes

IRON MOUNTAIN: Moody's Junks Five Classes After Review
J.P. MORGAN: S&P Assigns Low-B Rating to Six Certificate Classes
KAISER ALUMINUM: Alpart & Kaiser Liquidation Plan Overview
KB TOYS: Wants Plan-Filing Period Extended to Jan. 14
LAGUARDIA ASSOCIATES: Case Summary & Largest Unsecured Creditors

LYNX 2002-I: Moody's Slices Class D Notes' Rating to B3 from Ba2
MERRILL LYNCH: Fitch Places Low-B Rating on 17 Certificate Classes
METROMEDIA INT'L: Talking to Investor Group about Proposed Merger
METROPCS INC: Majority of Noteholders Consent to Limited Waiver
MID-AMERICAN MACHINE: Case Summary & Largest Unsecured Creditors

MICROCELL TELECOM: Sept. 30 Balance Sheet Upside-Down by C$41.7MM
MOLL AUTO SALES: Case Summary & 35 Largest Unsecured Creditors
MORTGAGE ASSET: Fitch Places Low-B Ratings on Four Cert. Classes
NAPIER ENVIRONMENTAL: Weak Financials Spur Restructuring Plans
NATIONAL ENERGY: ET Holdings Objects to Adam Mirick's $2.5M Claim

NETWORK INSTALLATION: Wins Wireless Project Order from ACON Labs
NEXTWAVE TELECOM: Selling All PCS Licenses to Verizon for $3 Bil.
NORTHERN KENTUCKY: Baseball Franchise Gets $3 Million Bid
PACIFIC GAS: Saybrook Details Hand in Bankruptcy Emergence
PAMET SYSTEMS: Sept. 30 Balance Sheet Upside-Down by $6.3 Million

PANOLAM INDUSTRIES: S&P Places B+ Rating on Planned $20M Facility
PEGASUS SATTELITE: Wants Exclusive Periods Extended Until Mar. 31
PENN NATIONAL: Moody's Reviewing Low-B Ratings Due to Merger Plans
PEREGRINE SYSTEMS: Providing Update in Nov. 10 Conference Call
PG&E NATIONAL: Moves to Pay TransCanada $12.7 Mil. Break-Up Fee

PG&E NATIONAL: Wants Court OK on Hydro Facilities Bidding Protocol
PILGRIM'S PRIDE: S&P Puts Low-B Ratings on $500M Debt Securities
PILLOWTEX CORP: Selling Miscellaneous Assets for $350,000
QUIGLEY COMPANY: Judge Beatty Denies Committee's Recusal Motion
QUIGLEY COMPANY: Look for Bankruptcy Schedules by November 19

RCN CORP: Court Oks Kasowitz Benson as Debtors' Conflicts Counsel
SALOMON BROTHERS: Fitch Slices Class M-3 Rating to BB+ from BBB
SHAW COMMUNICATIONS: Renews Normal Course Issuer Bid
SITHE/INDEPENDENCE: Fitch Assigns BB Rating to Secured Debts
STEWART ENTERPRISES: Moody's Puts Low-B Ratings on Loans & Bonds

STRUCTURED ASSET: Fitch Places Low-B Ratings on 10 Cert. Classes
SUN HEALTHCARE: Revised Sept. 30 Balance Sheet Shows $119M Deficit
TEXAS STATE: Moody's Pares Subordinate Revenue Bond Rating to Ba3
THOMSON MEDIA: Moody's Assigns Single-B Ratings to Loan Pacts
TRUMP HOTELS: Releases Details on $100MM DIP Loan Beal's Arranging

TW, INC.: Wants Solicitation Period Stretched to Jan. 31
UAL CORP: Gets Interim Extension to File Plan Until December 1
UAL CORP: Gets Court Nod to Reject Four Aircraft Leases
UNITED AIRLINES: Flight Attendants Balk at New Concession Demands
UNITED ONLINE: Moody's Rates Planned $150M Senior Secured Loan B1

UNIVERSAL ACCESS: Wants 6 More Months to Propose a Chapter 11 Plan
VARTEC TELECOM: Look for Schedules & Statements by Dec. 16
VARTEC TELECOM: Brings In Hughes & Luce as Special Counsel
VERESTAR INC: American Tower Tries to Torpedo Debtors' Plan
VIVENTIA BIOTECH: Dan Group Completes Private Placement

W.R. GRACE: Employees Sue Over $40-Mil Retirement Fund Sell-Out
WASHINGTON MUTUAL: Fitch Lifts Classes B2 & B5's Ratings to BBB
WILSON N. JONES: Weak Balance Sheet Cues Fitch to Cut Rating to B+
WORLDCOM INC: R.A.K. Wants Court to Compel Cure Claim Payment
WORLDCOM INC: Agrees to Withdraw Labor Department's ERISA Claims

* U.S. Corporate Credit Quality Slips in October, Says Kamakura

* BOND PRICING: For the week of November 8 - November 12, 2004

                          *********

A.B. DICK: Presstek Completes Purchase & Expands Loan to $80 Mil.
-----------------------------------------------------------------
Presstek, Inc. (Nasdaq: PRST), a manufacturer and marketer of
environmentally responsible high tech digital imaging solutions
for the graphic arts and laser imaging markets, reported that
parties have closed on Presstek's purchase of A.B.Dick Company.

A.B.Dick Company is a leading worldwide supplier to the graphic
arts and printing industry, manufacturing, marketing and servicing
equipment and supplies for all stages of document creation -- pre-
press, press and post- press.

In July 2004, A.B.Dick filed for Chapter 11 bankruptcy protection.
At the same time, Presstek entered into an asset purchase
agreement with A.B.Dick pursuant to which Presstek would acquire
the business and assets of A.B.Dick Company through the U.S.
Bankruptcy Code Section 363 asset sale provisions. Presstek's bid
was approved by the U.S. Bankruptcy Court on November 3, 2004.

Presstek's Chief Financial Officer Moosa E. Moosa stated, "The
closing price is approximately $40 million and will be paid in
cash. In connection with this transaction, Presstek has increased
its line of credit from $50 million to $80 million in a credit
agreement with Citizen's Bank, KeyBank and Bank North, a portion
of which will be used to accommodate the cash needs of this
transaction. Presstek has no plans at the present time to initiate
any stock offerings in connection with this acquisition."

Presstek's President and CEO Edward J. Marino said, "We are very
pleased to announce the completion of our acquisition of A.B.Dick.
We will begin working with A.B.Dick immediately to improve the
operation of the company. We would like to take this opportunity
to welcome A.B.Dick employees, as well as their customers and
vendors, to the Presstek family. We are looking forward to a
bright future together."

                          About Presstek
   
Presstek, Inc. is a leading manufacturer and marketer of
environmentally responsible high tech digital imaging solutions to
the graphic arts and laser imaging markets. Presstek's patented
DI(R), CTP and plate products provide a streamlined workflow in a
chemistry-free environment, thereby reducing printing cycle time
and lowering production costs. Presstek solutions are designed to
make it easier for printers to cost effectively meet increasing
customer demand for high-quality, shorter print runs and faster
turnaround while providing improved profit margins.

Presstek subsidiary Precision Lithograining Corporation is a
manufacturer of high quality digital and conventional printing
plate products, including Presstek's award-winning, chemistry-free
Anthem plate. Presstek subsidiary Lasertel, Inc., manufactures
semiconductor laser diodes for Presstek's and external customers'
applications.

For more information on Presstek, visit http://www.presstek.com/  
call 603-595-7000 or email: info@presstek.com

Headquartered in Niles, Illinois, A.B.Dick Company --
http://www.abdick.com/-- is a global supplier to the graphic arts  
and printing industry, manufacturing and marketing equipment and
supplies for the global quick print and small commercial printing
markets. The Company, along with its affiliates, filed for chapter
11 protection (Bankr. D. Del. Lead Case No. 04-12002) on July 13,
2004. Frederick B. Rosner, Esq., at Jaspen Schlesinger Hoffman,
and H. Jeffrey Schwartz, Esq., at Benesch, Friedlander, Coplan &
Aronoff LLP represent the Debtors in their restructuring efforts.
Richard J. Mason, Esq., at McGuireWoods, LLP, represents the
Official Committee of Unsecured Creditors. When the Debtor filed
for protection from its creditors, it listed over $10 million in
estimated assets and over $100 million in estimated liabilities.


AIR CANADA: Reports Record 77.7% October System Load Factor
-----------------------------------------------------------
Air Canada reported a system load factor of 77.7 per cent in
October 2004, the highest ever for October. The mainline carrier
flew 7.7 per cent more revenue passenger miles (RPMs) in October
2004 than in October 2003, according to preliminary traffic
figures. Overall, capacity increased by 1.5 per cent, resulting in
a load factor of 77.7 per cent, compared to 73.2 per cent in
October 2003; an increase of 4.5 percentage points. In the
domestic market, capacity decreased by 8.3 per cent while traffic
increased 1.7 per cent resulting in a domestic load factor of
80.1 percent - a 7.8 percentage point increase year over year.

Jazz, Air Canada's regional airline subsidiary, flew 4.3 per cent
more revenue passenger miles in October 2004 than in October 2003,
according to preliminary traffic figures. Capacity decreased by
17.1 per cent, resulting in a load factor of 72.4 per cent,
compared to 57.5 per cent in October 2003; an increase of 14.9
percentage points.

"In October we again achieved record system and North American
load factors as traffic continued to grow and capacity was
tightened. The decrease in North American capacity reflected the
elimination of our Boeing 737 fleet as well as the redeployment of
some aircraft to the rapidly growing Latin America market," said
Rob Peterson, Executive Vice President and Chief Financial
Officer. "Our simplified web fares, now also fully available in
the Transborder US market, continue to grow in popularity. We have
clearly become the airline of choice for the lowest fares to the
greatest number of destinations on an everyday basis."

Air Canada filed for CCAA protection on April 1, 2003 (Ontario
Superior Court of Justice, Case No. 03-4932) and filed a Section
304 petition in the U.S. Bankruptcy Court for the Southern
District of New York (Case No. 03-11971). Mr. Justice Farley
sanctioned Air Canada's CCAA restructuring plan on Aug. 23, 2004.
Sean F. Dunphy, Esq., and Ashley John Taylor, Esq., at Stikeman
Elliott LLP, in Toronto, serve as Canadian Counsel to the carrier.
Matthew A. Feldman, Esq., and Elizabeth Crispino, Esq., at Willkie
Farr & Gallagher serve as the Debtors' U.S. Counsel. When the
Debtors filed for protection from its creditors, they listed
C$7,816,000,000 in assets and C$9,704,000,000 in liabilities.

On September 30, 2004, Air Canada successfully completed its
restructuring process and implemented its Plan of Arrangement.
The airline exited from CCAA protection raising $1.1 billion of
new equity capital and, as of September 30, has approximately
$1.9 billion of cash on hand.


AIRCAST INTERNATIONAL: Moody's Assigns Single-B Rating to Loans
---------------------------------------------------------------
Moody's Investors Service assigned B1 ratings for the guaranteed
first lien senior secured facilities being arranged for Aircast
International Asset Acquisition Corp.  Moody's also assigned a B2
rating for Aircast's second lien term loan and a B2 senior implied
rating.  Moody's also assigned a B3 issuer rating to Aircast.

These new facilities will be issued to finance the purchase of
Aircast by Tailwind Capital Partners.

These ratings recognize:

   (1) expected demand growth in the mid-to-high single digits for
       ankle braces and walkers (the main products of the
       company),

   (2) Aircast's strong position in its niche market,

   (3) low collection risk,

   (4) geographic diversification,

   (5) low customer concentration,

   (6) conservative purchase price of the company and substantial
       equity investment made by the buyers.

The ratings also recognize disadvantages from the company's
overall size, deteriorating market share in ankle braces and
likely pricing pressure over the next two years from the Medicare
Modernization Act.  The outlook for all ratings is stable.

Moody's assigned these ratings:

   * B1 to the $5 million first lien revolving credit of Aircast
   * B1 to the $50 million first lien term loan
   * B2 to the $30 million second lien term loan
   * B2 senior implied for Aircast
   * B3 issuer rating for Aircast

Tailwind Capital Partners, an investment fund specializing in
healthcare, technology and media transactions, will purchase
Aircast at a multiple conservatiev for the industry.  Besides with
a new equity injection, the purchase of the company's equity will
be financed with $55 million in new first lien senior debt
($50 million expected drawn at closing), $30 million in new second
lien senior debt, and $15 million in subordinated seller notes, as
well as equity brought by the buyer.  At closing, total debt to
adjsuted EBITDA should be below 5.

Moody's projects that operating cash flow to debt is expected to
be approximately 11% for the year ending December 31, 2005 while
free cash flow to debt for the same period is expected to be 8%.
On a pro forma basis at June 30, 2004, the ratio of total secured
debt to adjusted EBITDA will stand at 3.46:1.

The stable outlook reflects the expectation that bank facility
covenants (which have not been determined at this stage) should
give Aircast sufficient financial flexibility and that the company
will apply the vast majority of the excess cash flow to debt
reduction, in spite of the mandatory recapture of only 50% in the
bank debt documentation.  If debt was not reduced by at least
$6 million in 2005, the ratings could come under pressure.  The
ratings could be upgraded if the ratio of free cash flow to debt
increased to 10% or more.

The ratings are supported by the strong demographic fundamentals
of the medical device industry.  Aircast generates two-thirds of
its revenue from ankle and walking braces.  Volume growth for the
category should be in the mid-to high single digits driven by the
increasing number of "baby boomers" entering or in middle age, and
their increased need for braces due to their higher degree of
physical activity.

The company has strong shares in its niche markets. Approximately
one-third of its revenue is generated overseas, providing
geographic diversification.  Its customer concentration is low.  
The largest customer (if wholesalers are considered "past-through"
entities) represents 2.4% of total sales.  Aircast does not rely
on direct reimbursement.  As a result, collection risk in this
credit is low.

At the same time, the ratings take into account expected pricing
pressure and volume risk due to passage of the 2003 Medicare
Modernization Act.  Payments under Medicare (off of which HMOs
index their payments) will not increase through 2006 for most
products manufactured by Aircast.  Starting in 2007, competitive
bidding could be introduced for many of the company's products in
various metropolitan areas.  Nonetheless, Moody's notes that the
absence of revenue generated from direct reimbursement provides
some pricing flexibility to the company, and that in the last
twelve months ended June 30, 2004, which included six months of
freeze in payments, the company still increased its sales in the
US in the high single digits due in large part to organic volume
growth.

The ratings also take into account the small size of the company,
which could make it less competitive on cost at the time that
competitive bidding is implemented.  This could affect volume and
price per unit.  Still, Moody's notes that other factors besides
price, such as quality of products, will be selection criteria.  
Also, excess cash flow recapture should lead to substantial debt
repayment by the time competitive bidding is fully ramped up
(i.e., in 2009).

Bank lenders will benefit from first and second liens on all US
assets of Aircast and on 66% of the stock in foreign subsidiaries.
All operating assets are in the US, strengthening the value of the
collateral package.  Moody's believes that the strength of
collateral coverage for first lien facilities supports a notching
of one, and that residual value should be sufficient to place the
rating on the second lien debt at the level of the senior implied
rating.

The sellers have been granted an earnout provision that will be
tied to certain minimum sales levels in the first three years
after the acquisition.  Moody's has tested the effect on cash flow
resulting from potential earnout payments, and concluded that debt
reduction would remain sufficiently strong for the assigned rating
level.

Based in Summit, New Jersey, Aircast is a manufacturer and
distributor of ankle braces, walkers, compression products and
vascular systems.


AIRGAS INC: S&P Lifts Rating One Notch to BB+
---------------------------------------------
Standard & Poor's Ratings Services raised its ratings on Airgas
Inc.  The corporate credit rating was raised to 'BB+' from 'BB'.  
The outlook is stable on this Radnor, Pennsylvania-based
industrial gas distributor.

The upgrade reflects the likelihood that credit quality will be
sustained at improved levels, despite periodic moderate-size
acquisitions.

"The company's stable cash flows are expected to be used to
support debt reduction, thus bolstering prospects that cash flow
protection measures for fiscal 2005 (ended March 2005) will be
fully satisfactory for the revised ratings," said Standard &
Poor's credit analyst Wesley E. Chinn.

The ratings on Airgas incorporate the moderate cyclicality of the
manufacturing and industrial markets the company serves and
management's aggressive financial policies that favor the use of
debt to fund acquisitions.  The most recent significant
transaction was the July 2004 acquisition of the U.S. packaged gas
business of The BOC Group PLC for $175 million in cash, plus a
contingent payment of up to $25 million if Airgas achieves certain
financial targets.  These negatives are tempered by Airgas'
position as the leading North American distributor of industrial
gases and related equipment, good operating margins, and stable
cash flows.

Within this industry, Airgas has the broadest geographic coverage,
via its distribution network in the U.S. encompassing over 900
locations.  The BOC transaction bolsters Airgas' already solid
business profile by providing cylinder gas operations in areas
where Airgas has little or no presence and enhancing specialty gas
capabilities.

The stable outlook recognizes the company's resilient internal
funds generation, which is expected to be used to reduce BOC
acquisition-related borrowings significantly near term.  With
operating profits in an upward trend, reflecting strength in
industrial markets and growth in strategic products, including
bulk, specialty and medical gases, the financial profile is
expected to be fully satisfactory for the ratings at the end of
the current fiscal year.

Upside rating prospects are tempered by Airgas' financial
policies, which are still viewed as aggressive by Standard &
Poor's.  Airgas will continue to make periodic acquisitions to
strengthen its position in existing markets, provide new
locations, and create cross-selling opportunities (of welding
supplies and safety equipment) to the customers that are being
acquired.  A further meaningful strengthening of credit quality
ratios through fiscal 2006 would be evidence of management's
commitment to a higher rating category, while a more aggressive
acquisition strategy, perhaps to diversify from current business
lines, would limit future upside ratings potential.


ALLEGHENY ENERGY: Third Quarter Net Loss Widens to $376.8 Million
-----------------------------------------------------------------
Allegheny Energy, Inc. (NYSE:AYE) reported a net loss of
$376.8 million for the third quarter of 2004, compared with a net
loss of $51.0 million in the third quarter of 2003. Third quarter
results for 2004 include $427.5 million in losses from
discontinued operations due principally to charges taken for
assets held for sale.

Allegheny Energy reported third quarter 2004 income from
continuing operations of $50.6 million compared with a loss from
continuing operations in the third quarter 2003 of $46.8 million.

"As expected, our core business returned to profitability in the
third quarter. Our power plants performed well, and we benefited
from continued cost reductions and lower interest expense," said
Paul J. Evanson, Chairman, President and Chief Executive Officer.
"In the third quarter, we also recognized non-cash charges on the
sale or impairment of certain non-strategic assets, as we
continued to execute on our plan to reduce debt and build a more
focused company."

To provide a better understanding of Allegheny Energy's core
results and trends, Allegheny Energy also reported adjusted
financial results, which are non-GAAP financial measures. A
reconciliation of these non-GAAP financial measures and results
reported in accordance with GAAP is attached to this release.

                  Third Quarter Adjusted Results

Allegheny Energy's income from continuing operations before income
taxes and minority interest was $70.8 million for the third
quarter of 2004, an increase of $39.1 million compared to adjusted
income from continuing operations before income taxes and minority
interest for the same period in 2003. Among the factors
contributing to the results were:

   -- Operations and maintenance expense decreased by $20.0
      million from the third quarter of 2003, primarily due to
      reduced spending on outside services.

   -- Interest expense decreased by $24.8 million from the prior
      year third quarter, primarily due to lower borrowing rates
      and lower average debt outstanding.

Earnings from continuing operations before interest, taxes,
depreciation and amortization (adjusted EBITDA) for the third
quarter 2004 were $243.2 million, an increase of $17.9 million
from the third quarter 2003. EBITDA is a non-GAAP financial
measure. For a reconciliation of EBITDA to GAAP financial measures
and details on the calculation of EBITDA, see the reconciliation
of non-GAAP financial measures attached to this release.

                  Third Quarter Segment Results

Delivery and Services

The Delivery and Services segment reported income from continuing
operations of $30.2 million for the third quarter of 2004,
virtually unchanged from the same quarter in the prior year. The
segment's operating revenues increased by $20.7 million, primarily
due to increased retail electric revenues from higher residential
and commercial sales as a result of greater usage. The higher
revenue was offset by higher purchased energy expense.

Generation and Marketing

The Generation and Marketing segment reported income from
continuing operations of $16.2 million for the third quarter of
2004, compared to a loss of $82.6 million for the same period in
2003. The segment's operating revenues increased by $119.2 million
primarily due to reduced losses as a result of Allegheny Energy's
exit from Western energy markets.

Interest expense for the Generation and Marketing segment in the
third quarter decreased by $23.3 million due to lower borrowing
rates and lower average debt outstanding.

Discontinued Operations

For the third quarter of 2004, the $427.5 million consolidated net
loss from discontinued operations includes a non-cash asset
impairment charge of $209.4 million pre-tax ($129.2 million after
tax) from the previously announced sale of the Lincoln generating
facility; a non-cash asset impairment charge of $35.1 million pre-
tax ($20.7 million after tax) associated with the previously
announced agreement to sell the West Virginia natural gas
operations; and non-cash asset impairment charges of $445.4
million pre-tax ($274.7 million after tax) as a result of the
previously announced decision to sell the Gleason and Wheatland
generating facilities. Discontinued operations also included an
after-tax loss of $2.9 million from operating results at these
units.

                  Nine-Month Consolidated Results

For the first nine months of 2004, Allegheny Energy reported a
consolidated net loss of $383.0 million, or $2.97 per diluted
share, compared with a consolidated net loss of $341.3 million, or
$2.69 per diluted share, for the first nine months of 2003. The
results for the first nine months of 2004 included $431.5 million
in losses from discontinued operations, and the first nine months
2003 results included losses of $17.3 million from discontinued
operations. Allegheny Energy's income from continuing operations
for the first nine months of 2004 was $48.5 million, or $0.38 per
diluted share, compared to a loss from continuing operations of
$303.3 million, or a loss of $2.39 per diluted share, in the first
nine months of 2003. The 2003 loss was primarily due to Allegheny
Energy's participation in Western energy markets, which it exited
in 2003.

A summary of nine-month results by business segment is included in
the attached financial tables.

                        About the Company

Headquartered in Greensburg, Pa., Allegheny Energy is an energy
company consisting of two major businesses, Allegheny Energy
Supply, which owns and operates electric generating facilities,
and Allegheny Power, which delivers low-cost, reliable electric
service to customers in Pennsylvania, West Virginia, Maryland,
Virginia and Ohio. More information about Allegheny Energy is
available at http://www.alleghenyenergy.com/

                          *     *     *

As reported in the Troubled Company Reporter on Sept. 14, 2004,
Fitch Ratings revised the Rating Outlook of Monongahela Power
Company to Stable from Negative. Approximately $838 million of
debt securities are affected. At the same time, Fitch has affirmed
the existing ratings of Allegheny Energy, Inc. and subsidiaries.
The Rating Outlooks for all issuers in the Allegheny Energy group
are Stable.

The revision of Monongahela's Outlook to Stable is based on the
successful execution of additional coal supply contracts for 2005
and 2006, the return to service of baseload coal-fired generation
units at the Hatfield's Ferry and Pleasants plants prior to the
start of peak seasonal demand, and the expectation that operating
and maintenance expenses will trend down. The new coal supply
contracts increase the hedged percentage of 2005 and 2006 coal
supply needs to 90% and 50%, respectively, and alleviate near term
commodity price risk. The all-in average prices for the locked in
portion of coal supply are approximately $34 for 2005 and Fitch
estimates it will be approximately $36.10 for 2006, which are well
below the current spot market price of Appalachian coal. While
the restoration of the major coal-fired units to service ended the
cash losses associated with purchasing replacement power at higher
cost, the company continues to be at risk for any future outages
under Monongahela's current retail tariffs. Monongahela is unable
to recover the costs of replacement supply in either West Virginia
or Ohio, and no near-term change is expected. A successful
closing of the recently announced sale of Mountaineer Gas would be
positive for credit quality. Mountaineer Gas has been a persistent
drag on profitability and the proceeds from any sale are
anticipated to be used for debt reduction. However, the closing
of the transaction is subject to material regulatory
contingencies.

The affirmation of the 'BB-' senior unsecured rating and Stable
Rating Outlook of the group parent, Allegheny, reflects the new
management's ongoing progress in restructuring efforts and debt
reduction and adequate parent company liquidity, as well as the
high consolidated leverage and weak cash flow coverage ratios.
Allegheny's rating reflects Fitch's expectation that Allegheny
would continue to provide support to the leveraged Allegheny
Energy Supply subsidiary as well as the cash flow from the
stronger, more stable regulated utility subsidiaries. Execution
of the remainder of the $1.5 billion debt reduction plan by year-
end 2005, improvement in cash flow generation at Supply,
improvements in plant operating performance and expense control,
and rate relief would improve credit quality. Credit concerns
include the risks of extended plant outages, rising environmental
compliance costs, adverse regulatory or judicial decisions, and
commodity price exposure (2006 and beyond).


ALLEGHENY ENERGY: S&P Places B Rating on $1 Bil. Sr. Sec. Facility
------------------------------------------------------------------
Standard & Poor's Ratings Services assigned its 'B+' rating and a
recovery rating of '2' to the $1.04 billion senior secured credit
facility to Allegheny Energy Inc. (B+/Positive/--) generation
subsidiary, Allegheny Energy Supply Co. LLC (B+/Positive/--).  The
outlook is positive.

The amended and restated bank loan replaces Allegheny Supply
Energy's existing $1.25 billion secured bank loan, but with a more
favorable interest rate structure.  The amended bank loan, which
only has one debt tranche, is secured by substantially all of
Allegheny's assets.

The '2' recovery rating indicates that holders of the bank loan
can expect substantial (80% to 100%) recovery of principal in the
event of a default.  Because of the recovery score, Standard &
Poor's did not assign a higher rating to the bank loan than its
issuer credit rating on Allegheny Energy Supply.  Allegheny Energy
Supply's recovery expectation is due to the large amount of
secured debt burden.  In addition to the $1.04 billion secured
bank loan, the collateral is shared with $344 million of secured
notes (St. Joseph bonds) and $280 million of pollution control
bonds.

"Standard & Poor's expects that the company will continue to
execute its plan to pay down $1.5 billion or more of debt between
December 2003 and the end of 2005," said credit analyst Tobias
Hsieh.  "Increased progress selling assets, paying down debt and
stabilizing cash flow, or positive outcomes from rate filings
could lead to ratings upgrades."

According to Standard & Poor's enterprise valuation method for
recovery analysis, which assumes 5x EBITDA after capital
expenditure, the value to secured debt for this transaction is
just below 100%, but failed to achieve the 100% threshold to
justify a higher rating.  An upgrade, however, is possible should
there be additional debt reduction in the future that raises the
coverage substantially above 100%.


AMKOR TECHNOLOGY: Moody's Says Liquidity Has Improved
-----------------------------------------------------
Moody's Investors Service raised Amkor Technology's speculative
grade liquidity rating to SGL-2 from SGL-3.  The upgrade
represents the restoration of good liquidity characteristics
following the funding of a $300 million term loan (which was rated
B1 by Moody's on October 13, 2004).  The funding of the term loan,
which will be used to restore cash balances, will meaningfully
increase Amkor's liquidity cushion, which will be depleted as a
result of more than $150 million of committed payments scheduled
for late 2004.

Given the company's most recent revenue guidance, Moody's
anticipates that Amkor's cash balances at yearend (following the
loan funding) would be no less than $350 million, and could be
somewhat higher.  Moody's expects Amkor can generate modest
positive cash flow in 2005, even in the current operating
environment, due to reduced spending plans.

Amkor's backup liquidity is very modest, consisting largely of a
$30 million revolving credit facility.  The second lien on the
term loan allows for potentially up to $1 billion of first lien
debt to be layered ahead of it based on incurrance tests.  
However, the company cannot make use of this provision today
because of covenant restrictions under its senior bond indenture.

Amkor Technology, Inc., headquartered in West Chester,
Pennsylvania, is the world's largest provider of contract
semiconductor assembly and test services for integrated
semiconductor device manufacturers as well as fabless
semiconductor companies.


AMRESCO: Moody's Junks Three Classes & Rates Two Classes Low-B
--------------------------------------------------------------
Moody's Investors Service has placed nine classes of Amresco's
franchise loan securitizations on review for possible downgrade.
The complete lists of securities placed on review are as follows:

Issuer: ACLC Business Loan Receivables Trust 1999-1

   * $ 64,000,000 6.516% Class A-1 Notes, currently rated Aa2
   * $ 19,000,000 6.940% Class A-2 Notes, currently rated A1
   * $100,347,000 7.385% Class A-3 Notes, currently rated Ba2
   * $17,672,000 7.710% Class B Notes, currently rated Caa1

Issuer: ACLC Business Loan Receivables Trust 2000-1

   * $68,600,000 Floating Rate Class A-3A Notes, currently
     rated A1
   * $15,300,000 8.030% Class A-3F Notes, currently rated A1
   * $16,275,000 8.390% Class B Notes, currently rated B1
   * $ 5,250,000 8.630% Class C Notes, currently rated Caa1
   * $13,650,000 8.870% Class D Notes, currently rated Ca

The rating actions are the result of high delinquency and default
rates that the deals continue to suffer in the last six months.
According to Shorie Darnaby, a senior credit officer in Moody's
asset finance group, the rating agency's review will focus on the
historical recoveries of defaulted loans, the timing of receipt of
such recovery proceeds by the related trusts, the existing and
potential future defaults and the current credit enhancement
available for each class.

AMRESCO Commercial Finance Inc. is the servicer on all the listed
securities and was a franchise lender that stopped originating
loans in 2002.


ARMSTRONG HOLDINGS: Sept. 30 Balance Sheet Upside-Down by $1 Bil.
-----------------------------------------------------------------
Armstrong Holdings, Inc. (OTC Bulletin Board: ACKHQ) reported
third quarter 2004 net sales of $893.5 million, a 4.9% increase
over third quarter net sales of $851.4 million in 2003. Excluding
the favorable effects of foreign exchange rates of $18.3 million,
consolidated net sales increased by 2.7%. Sales growth was
recorded for the Company's Building Products, Wood Products and
Cabinets segments primarily due to improved demand and higher
prices.

Operating income of $48.8 million was recorded for the third
quarter of 2004 compared to operating income of $17.8 million in
the third quarter of 2003. A non-cash charge of $8.0 million was
recorded in the third quarter of 2003 related to an asbestos claim
settlement. During 2003, Armstrong implemented several
manufacturing and organizational changes to improve its cost
structure and enhance its competitive position. The costs for
these initiatives incurred in the third quarter of 2003 totaled
approximately $33.6 million, of which approximately $24.0 million
was for accelerated depreciation. The remaining amount was
primarily for severances and related inventory obsolescence.
During the third quarter of 2004, net charges for cost reduction
initiatives were $1.4 million.

The improvement in operating income is primarily due to reduced
expenses relating to cost-reduction initiatives, lower operating
expenses as a result of implementing the cost-reduction
initiatives and improved pricing. Higher raw material costs,
particularly lumber and PVC, a lower mix of products, as well as
higher selling, general and administrative expenses, offset these
improvements.

                        Segment Highlights

Resilient Flooring net sales were $308.1 million in the third
quarter of 2004 and $315.6 million in the third quarter of 2003.
2004 sales compared to 2003 were favorably impacted by $5.4
million from the translation effect of the changes in foreign
exchange rates. The decline in sales was primarily due to unit
volume declines of laminate and vinyl products sold to major
national retailers. Operating income of $10.0 million was recorded
for the quarter, a decline of $10.8 million from the third quarter
of last year. The decline was due primarily to lower sales and
higher raw material costs, wages and salaries, partially offset by
expenses incurred in 2003 for the cost-reduction initiatives and
reduced expenses in 2004 resulting from implementing those
initiatives.

Wood Flooring net sales of $209.4 million in the third quarter of
2004 increased 14% from $183.7 million in the prior year. This
increase was primarily driven by higher sales volume and improved
selling prices. Operating income of $7.1 million in the third
quarter of 2004 compared to an operating loss of $9.9 million in
the third quarter of 2003. The increase in operating income was
primarily attributable to expenses incurred in 2003 for cost-
reduction initiatives, reduced expenses in 2004 resulting from
implementing those initiatives, sales volume gains and higher
prices. Partially offsetting these gains were higher lumber costs.

Textiles and Sports Flooring net sales of $70.0 million decreased
in the third quarter of 2004 compared to $73.3 million in the
third quarter of 2003. Excluding the favorable effects of foreign
exchange rates of $5.5 million, net sales decreased 11.2%.
Operating income of $2.8 million was reported for the third
quarter of 2004 compared to operating income of $0.2 million in
the third quarter of 2003. The increase in operating income was
primarily due to a $1.8 million gain on the sale of a previously
closed plant, expenses incurred in 2003 for cost-reduction
initiatives and reduced manufacturing expenses resulting from
implementing those initiatives, partially offset by the impact of
lower sales.

Building Products net sales of $250.2 million in the third quarter
of 2004 increased from $227.9 million in the prior year. Excluding
the favorable effects of foreign exchange rates of $7.5 million,
sales increased by 6.3%, primarily due to higher sales volume and
higher selling prices. Operating income for the quarter increased
to $40.0 million, from $32.4 million in the third quarter of 2003.
This increase resulted from increased sales, improved production
efficiencies and higher equity earnings from the WAVE joint
venture. These gains were partially offset by higher raw material
and energy costs, and wage and salary increases.

Cabinets net sales in the third quarter of 2004 of $55.8 million
increased from $50.9 million in 2003 due primarily to price
increases and sales of higher priced products. Operating income of
$2.8 million in 2004 improved by $6.0 million from a 2003
operating loss of $3.2 million. The improvement in operating
income was primarily due to the increased sales and reduced
manufacturing costs, partially offset by higher employee bonus
accruals.

                      Year-to-Date Results

For the nine-month period ending September 30, 2004, net sales
were $2,642.0 million, an increase of 7.7% from the $2,453.2
million reported for the first nine months of 2003. Increases were
reported for all segments except Textiles and Sports Flooring.
Excluding the favorable effects of foreign exchange rates of $69.5
million, consolidated net sales increased 4.7%.

Operating income in the first nine months of 2004 was $94.0
million. This compares to an operating loss of $4.3 million for
the first nine months of 2003. The improvement in operating income
was due to higher prices, increased sales volume, expenses
incurred in 2003 for cost-reduction initiatives and reduced
manufacturing expenses resulting from implementing those
initiatives. Partially offsetting these gains were increased raw
material and salary and wage costs.

More details on the Company's performance can be found in its Form
10-Q, filed with the SEC today. References to performance
excluding the effects of foreign exchange are non-GAAP measures.
Management believes that this information improves the
comparability of business performance by excluding the impacts of
changes in foreign exchange rates when translating comparable
foreign currency amounts.

                      2003 Form 10-K/A Filed

Armstrong recently requested guidance from the staff of the SEC on
interpreting Regulation S-X Rules 1-02(w) and 3-09. Based on
guidance from the staff of the SEC, Armstrong has determined it
should file an amended 2003 Form 10-K to include the audited
financial statements of WAVE ("Worthington Armstrong Venture"), a
50-50 joint venture partnership of Worthington Industries, Inc.
and Armstrong formed in 1992. When it originally filed the 2003
Form 10-K, Armstrong had disclosed condensed WAVE financial
information.

Armstrong Holdings, Inc. is the parent company of Armstrong World
Industries, Inc., a global leader in the design and manufacture of
flooring, ceilings and cabinets. In 2003, Armstrong's net sales
totaled more than $3 billion. Based in Lancaster, PA, Armstrong
has 44 plants in 12 countries and approximately 15,500 employees
worldwide. More information about Armstrong is available on the
Internet at http://www.armstrong.com/

At Sept. 30, 2004, Armstrong Holdings' balance sheet showed a
$1,300,700,000 stockholders' deficit, compared to a $1,330,200,000
deficit at Dec. 31, 2003.


ATA AIRLINES: Asks Court to Fix December 26 as Claims Bar Date
--------------------------------------------------------------
Rule 3003(c)(3) of the Federal Rules of Bankruptcy Procedure
provides that "The court shall fix and for cause shown may extend
the time within which proofs of claim or interest may be filed."  
The Local Bankruptcy Rules of the U.S. Bankruptcy Court for the
Southern District of Indiana do not specify a time by which proofs
of claim must be filed in Chapter 11 cases.

By this motion, ATA Holdings Corp., and its debtor-affiliates ask
Judge Lorch to establish December 26, 2004, as the deadline for
creditors to file their proofs of claim.  

The Debtors believe that the proposed Bar Date will give all
creditors ample opportunity to prepare and timely file claims.

The Debtors propose that each person or entity that asserts a
claim, as that term is defined in Section 101(5) of the
Bankruptcy Code, against them arising before the Petition Date or
is deemed to arise prior to the Petition Date pursuant to Section
501(d), must file an original, written proof of claim that
substantially conforms to the proof of claim that they will
circulate or the Official Form No. 10.  All proofs of claims will
be deemed timely filed only if actually received by BMC Group, the
Debtors' claims agent, on or before 5:00 p.m. P.S.T. on the
applicable Bar Date.  Proofs of claims sent by facsimile or
telecopy will not be accepted.

These persons or entities are not required to file a claim before
the Bar Date:

   (a) Any person or entity that has already properly filed with
       the Clerk of the Bankruptcy Court or BMC, a proof of claim
       against the Debtors utilizing a claim form substantially
       in conformity with Official Form No. 10;

   (b) Any person or entity:

          (i) whose claim is listed on the Debtors' schedules of
              assets and liabilities or any amendments thereto;

         (ii) whose claim is not listed as "disputed,"
              "contingent," or "unliquidated"; and

        (iii) who does not dispute the amount, classification or
              nature of the claim for that person or entity as
              set forth in the Schedules or any amendments
              thereto;

   (c) Any person having a claim under Sections 330, 331(a), 503,
       and 507(a) of the Bankruptcy Code as an administrative
       expense of Debtors' Chapter 11 cases;

   (d) Claims or Interests made by any holder of equity
       securities of Debtors solely with respect to that holder's
       ownership interest in or possession of the equity
       securities; and

   (e) Any person or entity that holds a claim that has been
       allowed by a Court order entered on or before the Bar
       Date.

The Debtors will distribute a proof of claim form tailored to
conform to the size and complexity of their Chapter 11 cases.  
The proposed Proof of Claim Form substantially conforms to
Official Form No. 10.

The modified Proof of Claim Form:

   -- indicates which Debtor case the claimant is scheduled in
      and that Debtor's case number;

   -- allow the creditor to correct any incorrect information
      contained in the name and address portion;

   -- indicate how Debtors have listed each creditor's claim on
      Debtors' Schedules, including the amount of the claim, the
      classification of the claim and whether the claim has been
      listed as contingent, unliquidated, or disputed; and

   -- include certain instructions for completing the form.

The Debtors ask the Court to approve the modified Proof of Claim
Form.

Pursuant to Bankruptcy Rule 3003(c)(2), the Debtors ask Judge
Lorch to enjoin any holder of a claim who is required, but fails,
to file a proof of claim in accordance with the Bar Date Order on
or before the Bar Date from asserting the claim.  The Debtors and
their property will be forever discharged from any and all
indebtedness or liability with respect to the claim, and the
holder will not be permitted to (i) vote on any plan of
reorganization or participate in any distribution in the Debtors'
Chapter 11 cases on account of the claim or (ii) receive further
notices regarding the claim.

The Debtors will mail a notice of the Bar Date and a Proof of
Claim Form to:

   (1) each member of the statutory committee appointed in their
       cases and the committee's attorneys;

   (2) all parties listed on the Debtors' master creditor list,
       including all known holders of claims and interests listed
       on the Schedules at the addresses stated therein and their
       counsel, if known;

   (3) all state and local taxing authorities for the
       jurisdictions in which the Debtors conduct or previously
       conducted their businesses;

   (4) parties to any litigation that was pending as of the
       Petition Date and any party that has filed a motion to
       lift the automatic stay;

   (5) all persons and entities requesting notice pursuant to
       Bankruptcy Rule 2002; and

   (6) the Office of the United States Trustee for Region 10.

A creditor holding claims against more than one Debtor must file a
separate claim in the case of each Debtor against which the
creditor asserts a claim.  A creditor will be bound by the Debtor
it named in its proof of claim.  

Headquartered in Indianapolis, Indiana, ATA Airlines, owned by ATA  
Holdings Corp. -- http://www.ata.com/-- is the nation's 10th  
largest passenger carrier (based on revenue passenger miles) and
one of the nation's largest low-fare carriers.  ATA has one of the
youngest, most fuel- efficient fleets among the major carriers,
featuring the new Boeing 737-800 and 757-300 aircraft.  The
airline operates significant scheduled service from Chicago-
Midway, Hawaii, Indianapolis, New York and San Francisco to over
40 business and vacation destinations.  Stock of parent company,
ATA Holdings Corp., is traded on the Nasdaq Stock Exchange.  The
Company and its debtor-affiliates filed for chapter 11 protection
on Oct. 26, 2004 (Bankr. S.D. Ind. Case No. 04-19866, 04-19868
through 04-19874).  Terry E. Hall, Esq., at Baker & Daniels,
represents the Debtors in their restructuring efforts.  When the  
Debtors filed for protection from their creditors, they listed  
$745,159,000 in total assets and $940,521,000 in total debts.
(ATA Airlines Bankruptcy News, Issue No. 2; Bankruptcy Creditors'
Service, Inc., 215/945-7000)


ATA AIRLINES: Denver & SFO Airports Balks at Cash Collateral Use
----------------------------------------------------------------
Two airport operators object to ATA Airlines and its debtor-
affiliates' use or further pledge of their prepetition cash
collateral to the extent that the cash collateral include the
Airports' trust funds for Passenger Facility Charges:

   (1) Denver International Airport, which is owned and operated
       by the City and County of Denver in connection with its
       municipal airport system; and

   (2) the City and County of San Francisco, acting by and
       through the San Francisco Airport Commission.

The Airports want to ensure that the PFCs collected by the  
Debtors are neither included with their cash collateral nor  
commingled with any of the Debtors' other obligations.

Douglas W. Jessop, Esq., at Jessop & Company, PC, in Denver,  
Colorado, informs the United States Bankruptcy Court for the
Southern District of Indiana that the Debtors have used the  
Airports' facilities in the operation of their businesses by,  
among other things:

   -- causing passenger aircraft to land at and take off from
      the Airports;

   -- using the Airports' terminal space, including gates,
      offices, baggage and ramp areas;

   -- using the non-terminal space, like cargo areas and aircraft
      parking spaces; and
  
   -- using the Airports' equipment, including common use baggage
      handling equipment and check-in equipment.

The Debtors incur these obligations to the Airports on a monthly  
basis:

   (i) rent, charges and landing fees totaling $200,000 with
       respect to Denver and $345,700 with respect to San
       Francisco; and

  (ii) PFCs aggregating $73,000 with respect to Denver and
       $202,000 with respect to San Francisco.

The PFCs are passenger ticket charges collected by airlines as  
required by 49 U.S.C. Section 40117 and governed by detailed  
Federal regulations set forth at 14 C.F.R. Section 158.  The U.S.  
Department of Transportation's regulations provide that the PFC  
revenues that are held by an air carrier or an agent of the  
carrier after collection of a PFC constitute a trust fund that is  
held by the air carrier or agent for the beneficial interest of  
the public agency imposing the PFC.  That carrier or agent holds  
neither legal nor equitable interest in the PFC revenues except  
for any handling fee or retention of interest collected on  
unremitted proceeds.

Since commencing operations at the Airports, the Debtors are  
required to collect and remit PFCs to Denver and San Francisco in  
the amount of $4.50 per enplaned passenger.  PFCs are used by the
Airports for airport development.

Before the Petition Date, the Debtors have been complying with  
the accounting and remittance requirement of the PFC regulations  
with respect to both Airports.  The Debtors, however, have failed  
to fully pay PFCs to San Francisco for September 2004.  

Headquartered in Indianapolis, Indiana, ATA Airlines, owned by ATA  
Holdings Corp. -- http://www.ata.com/-- is the nation's 10th  
largest passenger carrier (based on revenue passenger miles) and
one of the nation's largest low-fare carriers.  ATA has one of the
youngest, most fuel- efficient fleets among the major carriers,
featuring the new Boeing 737-800 and 757-300 aircraft.  The
airline operates significant scheduled service from Chicago-
Midway, Hawaii, Indianapolis, New York and San Francisco to over
40 business and vacation destinations.  Stock of parent company,
ATA Holdings Corp., is traded on the Nasdaq Stock Exchange.  The
Company and its debtor-affiliates filed for chapter 11 protection
on Oct. 26, 2004 (Bankr. S.D. Ind. Case No. 04-19866, 04-19868
through 04-19874).  Terry E. Hall, Esq., at Baker & Daniels,
represents the Debtors in their restructuring efforts.  When the  
Debtors filed for protection from their creditors, they listed  
$745,159,000 in total assets and $940,521,000 in total debts.
(ATA Airlines Bankruptcy News, Issue No. 2; Bankruptcy Creditors'
Service, Inc., 215/945-7000)


BALLY TOTAL: Moody's Reviewing Single-B & Junk Ratings
------------------------------------------------------
Moody's Investors Service placed the ratings of Bally Total
Fitness Holding Corporation on review for possible downgrade
following Bally's announcement that the trustee under its senior
and subordinated note indentures informed the company that it will
send default notices to the company unless Bally commences consent
solicitations by November 15, 2004, and has either cured the
defaults or obtained the necessary waivers from the holders of a
majority of each series of notes by December 15, 2004.  The
trustee has advised the company that it would begin notifying
noteholders of default in accordance with the indentures.  Moody's
is concerned that an event of default under the indentures may be
triggered if Bally is unable to obtain the necessary waivers or
cure the default.

Moody's placed these ratings on review for possible downgrade:

   * $175 million Senior Secured Term Loan B Facility, due 2009,
     rated B2;

   * $100 million Senior Secured Revolving Credit Facility, due
     2008, rated B2;

   * $235 million 10.5% Senior Unsecured Notes, due 2011,
     rated B3;

   * $300 million 9.875% Senior Subordinated Notes, due 2007,
     rated Caa2;

   * Senior Implied, rated B3;

   * Senior Unsecured Issuer, rated Caa1.

Bally has not filed its Form 10-Q quarterly report for the second
quarter ended June 30, 2004 with the Securities and Exchange
Commission.  In connection with its previous announcement that it
postponed the filing of its second quarter Form 10-Q, the company
indicated that it is working with its independent auditors under
the oversight of its audit committee to resolve certain accounting
issues before filing further financial statements.  The failure by
Bally to file its Form 10-Q for the second quarter on a timely
basis would constitute an event of default under its senior
unsecured and senior subordinated note indentures if notice is
given by the indenture trustee and a thirty day cure period
expires.

The lenders under Bally's $275 million secured credit facility
have foregone any requirement for receipt from the company of
financial statements filed with the SEC.  However, the credit
agreement provides for a cross-default ten days after delivery to
Bally of a default notice under either of the indentures.  As a
result, delivery of a default notice under either indenture to
Bally could result in acceleration of Bally's obligations under
the credit facility and the indentures.

Moody's review will focus on whether Bally can avoid an event of
default by filing its Form 10-Q for the second quarter or obtain
the necessary waivers from the holders of a majority of each
series of notes by December 15, 2004. Moody's will also consider
expected recovery values in the event of a default.  The senior
secured revolving credit facility and senior unsecured notes are
expected to have relatively high recovery values in the event of a
default due to Bally's expected enterprise value and the value of
its real estate and receivables.  As of March 31, 2004, the
company's short term and long term net installment receivables
totaled $729 million on a gross basis.  Additionally, the net
reported book value of property and equipment as of March 31, 2004
was $618 million.  Expected recovery rates for the senior
subordinated notes in the event of a default are more uncertain
and reflect the contractual subordination of these notes and their
lack of guarantees.

Headquartered in Chicago, Illinois, Bally is the largest
commercial operator of fitness centers in North America.  Revenue
for the year ended December 31, 2003 was approximately
$953 million.


BEAR STEARNS: Fitch Puts Low-B Ratings on Six Certificate Classes
-----------------------------------------------------------------
Bear Stearns Commercial Mortgage Securities Trust 2004-TOP16,
commercial mortgage pass-through certificates are rated by Fitch
Ratings as follows:

   -- $20,000,000 class A-1 'AAA';
   -- $60,000,000 class A-2 'AAA';
   -- $100,000,000 class A-3 'AAA';
   -- $100,000,000 class A-4 'AAA';
   -- $80,000,000 class A-5 'AAA';
   -- $676,075,000 class A-6 'AAA';
   -- $20,231,000 class B 'AA';
   -- $13,005,000 class C 'AA-';
   -- $13,005,000 class D 'A';
   -- $15,895,000 class E 'A-';
   -- $10,115,000 class F 'BBB+';
   -- $11,560,000 class G 'BBB';
   -- $10,115,000 class H 'BBB-';
   -- $2,891,000 class J 'BB+';
   -- $4,335,000 class K 'BB';
   -- $5,780,000 class L 'BB-';
   -- $1,445,000 class M 'B+';
   -- $1,445,000 class N 'B';
   -- $2,890,000 class O 'B-';
   -- $7,225,001 class P 'NR';
   -- $1,156,012,001 class X-1* 'AAA';
   -- $1,108,051,000 class X-2* 'AAA'.

      * Notional Amount and Interest Only.

Class P is not rated by Fitch.  Classes A-1, A-2, A-3, A-4, A-5,
A-6, B, C, D, E, and X-2 are offered publicly, while classes F, G,
H, J, K, L, M, N, O, P, and X-1 are privately placed pursuant to
Rule 144A of the Securities Act of 1933.  The certificates
represent beneficial ownership interest in the trust, primary
assets of which are 123 fixed-rate loans having an aggregate
principal balance of approximately $1,156,012,001, as of the
cutoff date.


BELL CANADA: Third Quarter Revenue Up 3.3 Percent to $4.8 Billion
-----------------------------------------------------------------
For the third quarter of 2004, BCE Inc. (TSX, NYSE: BCE) reported
revenue of $4.8 billion, up 3.3% and EBITDA of $1.9 billion, up
2.2% when compared to the same period last year.

"In the third quarter we continued to make steady progress in the
execution of our business plans," said Michael Sabia, President
and Chief Executive Officer of BCE. "We continue to focus
successfully on medium-term revenue growth opportunities, on
effective cost management and on rapidly transforming the company
to meet new market realities."

The company recorded restructuring and other charges in the
quarter which had a negative impact on reported operating income
and on earnings per share (EPS). Exclusive of these restructuring
and other charges and the net gains on investments, BCE's
operating income was up $56 million or 5.3% and EPS was $0.52, an
increase of 8.3% over the previous year. Including restructuring
and other charges, operating income was $25 million, down
$1,024 million from the third quarter of last year while EPS was
$0.09, down from $0.49 last year.

The restructuring charge reflects the cost of Bell's Voluntary
Employee Departure Program, introduced over the summer. Under the
program 5,052 Bell Canada employees (approximately 11% of Bell
Canada's total workforce) will leave the company. Departures have
begun and will be largely completed by year-end. The departures
are being managed to ensure a smooth transition and that service
levels will not be affected. The company has taken a charge of
$985 million ($647 million after-tax) in this quarter relating to
these departures. Annual savings of $390 million are expected
going forward.

"The industry is in a period of rapid change and we are committed
to remaining in step with that change," said Mr. Sabia. "New
entrants and emerging technologies are altering the competitive
landscape and new business models are required to maintain our
leadership and meet our customers' expectations. The Employee
Departure Program helps us build a new cost structure for the
company and strengthens our position as the marketplace continues
to evolve."

Recognizing that evolution, the company is building on its growth
potential in wireless, DSL and video in Bell's Consumer segment
and on the provision of Internet Protocol (IP) and value-added
solutions in the Business segment. In wireless, total subscribers
are up 11.5% over last year. DSL subscribers are up 27% and, by
nearly doubling the number of new video customers year over year,
ExpressVu became the third largest broadcast distribution company
in Canada. Revenue from value-added solutions in both the
Enterprise and SMB groups was up this quarter. At the end of
September 2004, 60% of the traffic on Bell Canada's core network
was IP-based, already meeting Bell's 2004 year-end target.

Cost management and financial discipline across the company
allowed BCE to continue its focus on margin improvement. Bell
Canada continues its internal transformation through the
implementation of IP technology, the simplification of operations
and the reinvention of processes. The company is now well
positioned to reach its goal of removing $1 billion in annual
costs by the end of 2006.

                Bell Canada Financial Performance

Excluding the impact of the labour disruption at Aliant (which
ended in late September) and the restructuring and other charges,
Bell Canada's revenue growth was 1.6%, operating income increased
8.7% and operating margin increased to 26.1% from 24.4%. Including
these factors, Bell Canada's revenue growth was 1.2%, operating
income decreased from $1,012 million to an operating loss of $13
million, and operating margin was negative 0.3% compared to 24.4%.

                     Key Operational Achievements

Bell's success going forward will be predicated on its ability to
strengthen and strategically refine operations through innovation,
investment in new technologies and continuing efforts to
strengthen service to customers.

Bell continues to build on its expertise in each of its three main
customer segments. Mr. Sabia commented: "In each of these business
segments, we are seeing a strengthening of our prospects in new
and emerging opportunities. That strengthening has been predicated
on the strategic analysis we undertook more than a year ago and on
the development and continuing sound execution of our business
plans. With Internet Protocol we are creating an entirely new
generation of Value-Added Solutions for our business customers.
And on the consumer front we continue to build the "Broadband
Home" through solid ongoing growth in wireless, high speed
Internet and video services and a new generation of Value-Added
Solutions."

                             Consumer

Revenues in the Consumer segment grew by 3.8% in the quarter to
reach $1.9 billion. Revenues for the first nine months stand at
$5.6 billion, an increase of 4.8% over the same period in 2003.
Operating income was 3.1% higher in the quarter and 6.9% higher
year to date.

Subscribers to Bell Canada's "Digital Bundle" grew by 114,000 in
the third quarter. The Digital Bundle consists of a combination of
video, wireless and high-speed Internet service and is an
effective means of increasing sales of these services by offering
package pricing. During the quarter, 43% of new Bundle activations
included the sale of at least one new service. There are now
313,000 Bell Digital Bundle customers.

The Bell Bundle was enhanced in late June with the launch of a
$5/month long distance plan for 1,000 minutes of calls anywhere in
Canada and the U.S. available only to Digital Bundle subscribers.
This offer leverages the company's long distance customer base to
drive sales of our growth services (wireless, Internet and video),
as well as to capitalize now on the value of our long distance
business. Since its introduction, approximately 115,000 Long
Distance Bundles have been sold.

                             Business
  
Growth in operating income was strong, despite the fact that
revenues remained flat in the Business segment. Operating income
increased 26.9% in the quarter to reach $245 million and by 22.5%
in the first nine months to reach $713 million.

Small and Medium Business

The SMB group achieved a solid quarter, and will continue to focus
on its "Technology Advisor" strategy. This segment of the business
market has traditionally been underserved and Bell Canada has
taken a number of steps to bolster its leadership position in this
space. These steps include significant reduction in service
delivery times, the creation of a highly specialized sales force
and acquisition of niche capabilities to broaden the suite of
services Bell Canada can provide.

On August 3, 2004, the SMB Group launched ProConnect, a fully
managed service which enables small and medium businesses to share
information easily, securely and affordably across the most
extensive private IP-based network in Canada. At the outset,
demand for this service is high and is leading to greater profile
for the group's IP capabilities.

Cross selling opportunities created by becoming part of the Bell
Canada family is growing revenues at recently acquired Charon
Systems (an IT solutions provider).

During the quarter, SMB sold approximately 23,000 Value-Added
Solutions (VAS) - nearly double what was sold in all of 2003.
These services included Desktop Security, Hosting, Single Number
Reach and Productivity Pak.

The SMB group also made substantial progress in making its
products and services simpler. For example, it has reduced the
time required to deliver services to its customers by a
significant margin. That means better and faster service for
customers and a more quickly activated revenue stream for the
company. This model to drive more efficient processes is being
applied throughout the entire suite of products within SMB.

Enterprise

Bell Canada Enterprise group reached a number of milestones during
the quarter demonstrating leadership in the implementation of IP
technology and in the provision of IP services to businesses in
Canada.

Bell Canada now has 110,000 IP enabled lines running off customer
premise equipment (CPE) and has a national Managed Internet
Protocol Telephony (MIPT) service fully in place.

While areas of the group's legacy business are witnessing declines
as the transition to IP occurs, Bell's IP-based connectivity and
VAS revenues continue to grow significantly and are on track to
achieve year-end targets. IP-based connectivity services grew by
35% this quarter with almost two-thirds of Bell Canada's large
Enterprise customers using some elements of the company's VAS
portfolio.

Bell Enterprise enjoyed strong third quarter sales momentum that
led to a significant number of customer wins.

For example, Bell recently signed a significant three-year service
contract with Ontario-based Hydro One Networks Inc. Under the
contract, Bell will provide maintenance and management service for
the electric utility's telephone systems, data internetworking
equipment and cabling infrastructure via a new Bell product,
Enterprise Workflow Management. Hydro One Networks is Bell's first
customer for this product which gives Bell Canada customers a
means to manage their complex network assets in a simpler and more
efficient fashion.

There were also two important contract wins with the Government of
Qu,bec during the quarter. The first involves the renewal of a
contract for the integration and management of the province's
digital land records and registry documents platform. Bell's
initial role on this project as connectivity provider has expanded
to include systems integration and network management functions.
The second contract is for the implementation of an electronic
authentication security system. The contract is important because
it reinforces Bell Canada's position as a leading provider of
value-added solutions.

Bell West

Bell continues to grow its customer base in Alberta and British
Columbia, leading to increases in data and wireless revenues both
this quarter and on a year-to-date basis. Construction continues
on Alberta's SuperNet, which will deliver a world-class IP network
to the provincial government. Bell will now also focus on the
development of innovative IP applications to run over this
network, considered one of the most advanced and comprehensive in
the world.

Bell expects to close its purchase of 360 Networks during the
first half of November, doubling both the number of customers and
access to buildings in the West and allowing the company to run a
far greater portion of its traffic on its own networks. For
business and consumers in Alberta and British Columbia, Bell is
the number one competitive alternative, and one of the fastest
growing enterprises in Western Canada.

                  Performance of Growth Drivers

Wireless

Wireless EBITDA margin was strong at 45.4% in the quarter. The
cost of acquisition (COA) per subscriber improved by 10.4% in the
quarter to $381.

BCE's wireless subscriber base grew by 109,000 net additions this
quarter to reach 4.7 million customers, an increase of 11.5% over
last year. Compared to the third quarter of 2003, net additions
were down by 15,000.

In the quarter, the company achieved its best wireless churn rate
since the beginning of 1997, with blended churn at 1.2% and
postpaid churn at 1.0%. On a year-to-date basis, blended churn of
1.3% and post-paid churn of 1.1% reflected improvements of 0.1 and
0.2 percentage points compared to the same period last year.

This performance in wireless was achieved as the company managed
the highly complex migration of its nearly five million customers
to a new billing platform, considered to be one of the largest IT
projects undertaken in Canada this year. With the introduction of  
our new wireless billing platform in May of this year, our focus
was to ensure continuity of service levels and the orderly billing
migration of our existing customer base rather than aggressively
pursuing growth. Billing is now up to date as billing volumes
peaked during the quarter and have returned to normal levels. The
wireless unit continues to focus on returning customer service
levels to normal as quickly as possible.

High-Speed Internet (DSL)

The company's digital subscriber line (DSL) high-speed Internet
business added 96,000 subscribers this quarter growing the
subscriber base by 27% over the third quarter of 2003 to
1,766,000.

Subscriptions to Sympatico's value-added solutions increased by
20,000 to reach a total of 453,000 at the end of the quarter. The
company's new Sympatico.MSN.ca web site is performing well. For
example, traffic being forwarded to bell.ca (where Bell services
can be ordered) has increased 33% since the launch of the new
portal. Revenues from the portal have increased by 40%.

The company's DSL footprint in Ontario and Qu,bec reached 81% of
residential and business lines passed by the end of the quarter
compared to 79% at the end of the third quarter of 2003. This
increase was in part due to the deployment of new high-density DSL
remotes which began in April, 2004. These remotes not only extend
high-speed availability throughout the network, they also lay the
groundwork for Bell to offer video to the home over higher-speed
DSL connections. By the end of the quarter, the company had
deployed 139 of these new remotes.

Video

Customer gains of 33,000 in the video business were almost double
the net activations achieved in Q3 last year and significantly
outpaced growth in the second quarter this year. Total subscribers
at the end of the quarter reached 1,460,000, 8% higher compared to
the same period last year.

Bell Canada has taken steps recently to revitalize its video
business with new initiatives that are leading to a stronger
growth trajectory. These initiatives have included: more flexible
programming packages starting at $25 per month; an advanced
personal video recorder (PVR) that allows customers to watch and
record on two separate TVs simultaneously; a simplified channel
line-up; a simplified pricing structure; and a simplified on-
screen programming guide.

Solid progress was made this quarter in Bell ExpressVu's
deployment of very high-speed DSL (VDSL) to multiple dwelling
units (MDUs). By the end of the quarter, Bell had signed access
agreements with 220 buildings, on track to achieve the year-end
goal of 300 buildings.

"Continued strong growth in wireless, DSL and video remain
critical for the company," said Mr. Sabia. "These are the building
blocks of the future core of our business operations and their
continued growth through effective promotion and continued
investment remains a top priority for the company."

Bell Globemedia

Revenues at Bell Globemedia were up 2% and operating income
improved by 15%.

CTV had 17 of the top 20 regularly scheduled programs in the
country during the summer period. Canadian Idol was once again a
national phenomenon with viewership peaking at 4.2 million making
it Canada's most watched, non-sports program for the second
straight season and helping drive increased advertising revenues.

The Globe and Mail recently launched a new subscription-based web
site called "Insider Edition" available from globeandmail.com .
The Globe and Mail is seeing strength in its circulation numbers
and in revenue growth from its various web properties.

Telesat Canada

Telesat Canada reported revenues of $91 million in the third
quarter, an increase of 8.3% over last year. Operating income was
$39 million, an increase of 39.3%.

Telesat completed testing and put into operation its Anik F2
satellite which is the first triple band satellite in the world
and the first satellite capable of providing two-way Ka broadband
services. The company also launched service on Nimiq 3 which will
provide high-power and back-up operations for ExpressVu's direct-
to-home television services.

Attesting to its international reputation, Telesat's consulting
services are now being used by the Nigerian National Space Agency
and the Co-operation Council of the Arab States of the Gulf.
Telesat has also been selected as a prime vendor for an
interactive distance learning network that will span Canada, the
U.S., Mexico and Europe.


    Other Significant Developments

    -- Bell Canada was selected by the Vancouver Organizing
      Committee for the 2010 Olympic and Paralympic Winter Games
      as its Premier National Partner. The partnership continues
      through to 2012, securing for Bell the Canadian Olympic Team
      sponsorship rights to Torino in 2006, Bejing in 2008,
      Vancouver in 2010, the 2012 Games, and for two Pan-American
      Games. The Olympics will be the core platform to enhance
      Bell Canada's brand as the leading national provider of
      communications services.

   -- Bell Canada signed a labour contract with its technical
      employees that extends until November, 2007. As well Aliant
      ended a work disruption when it reached a contract
      settlement with its unionized employees which also extends
      until December, 2007.

   -- In July, Bell sold its remaining 3.24% interest in The
      Yellow Pages Directory Group for $123 million.

   -- In August, Bell Canada completed the purchase of MTS's 40%
      interest in Bell West for $646 million in cash. Bell Canada
      now holds 100% of Bell West.

   -- In September, Bell Canada sold its remaining 15.96% interest
      in MTS for proceeds of $584 million. This was in addition to
      a payment of $75 million made by MTS to Bell Canada in
      consideration of the early termination of their commercial
      agreements.

                             Outlook

BCE confirmed its annual full year 2004 financial guidance of:

   -- revenue growth comparable to 2003 growth

   -- mid-to-high single-digit growth in earnings per share
      (before net investment gains/losses, impairment or
      restructuring charges)

   -- free cash flow of approximately $1 billion, mainly from
      recurring sources, and

   -- Bell Canada capital intensity of 17% to 18%.

                   Bell Canada Statutory Results

Bell Canada "statutory" includes Bell Canada, and Bell Canada's
interests in Aliant, Bell ExpressVu (at 52%), and other Canadian
telcos.

Bell Canada's reported statutory revenue was $4.2 billion in the
third quarter of 2004, up 1.2% compared to the same period last
year. Net loss applicable to common shares was $53 million in the
third quarter of 2004, compared to net earnings applicable to
common shares of $550 million for the same period last year.

                            About BCE
    
Bell Canada Enterprises is Canada's largest communications
company. Through its 26 million customer connections, BCE provides
the most comprehensive and innovative suite of communication
services to residential and business customers in Canada. Under
the Bell brand, the company's services include local, long
distance and wireless phone services, high speed and wireless
Internet access, IP-broadband services, value-added business
solutions and direct-to-home satellite and VDSL television
services. Other BCE businesses include Canada's premier media
company, Bell Globemedia, and Telesat, a pioneer and world leader
in satellite operations and systemsmanagement. BCE shares are
listed in Canada, the United States and Europe.

BCE 2004 Third Quarter Financial Information

BCE's 2004 Third Quarter Shareholder Report (which contains BCE's
2004 third quarter MD&A and unaudited consolidated financial
statements) and other relevant financial materials are also
available at http://www.bce.ca/en/investors/under "Investor  
Briefcase". BCE's 2004 Third Quarter Shareholder Report is
also available on the Web sites maintained by the Canadian
securities regulators at http://www.sedar.com/and by the U.S.  
Securities and Exchange Commission at http://www.sec.gov/It is  
also available upon request from BCE's Investor Relations
Department (e-mail: investor.relations@bce.ca,               
tel.: 1 800 339-6353; fax: (514) 786-3970).

BCE's 2004 Third Quarter Shareholder Report will be sent to BCE's
shareholders who have requested to receive it on or about Nov. 8,
2004.

BCE is Canada's largest communications company. It has 25 million
customer connections through the wireline, wireless, data/Internet
and satellite services it provides, largely under the Bell brand.
BCE's media interests are held by Bell Globemedia, including CTV
and The Globe and Mail. As well, BCE has e-commerce capabilities
provided under the BCE Emergis brand. BCE shares are listed in
Canada, the United States and Europe.

BCI is operating under a court supervised Plan of Arrangement,
pursuant to which BCI intends to monetize its assets in an orderly
fashion and resolve outstanding claims against it in an
expeditious manner with the ultimate objective of distributing the
net proceeds to its shareholder and dissolving the company. BCI is
listed on the Toronto Stock Exchange under the symbol BI and,
until December 31, 2003, on the NASDAQ National Market under the
symbol BCICF. Visit its Web site at http://www.bci.ca/


BERKLINE/BENCHCRAFT: Moody's Affirms Single-B Ratings on Loans
--------------------------------------------------------------
Moody's Investors Service affirmed the existing ratings of
Berkline/Benchcraft following the revised structure of the second
lien bank term loan and of the revolving credit facility.  The
company plans to reduce the sizes of the second lien term loan
(rated B2) by $20 million to $50 million and the revolving credit
facility (rated B1) by $10 million to $25 million.  The outlook
remains stable.

Moody's affirmed these ratings of Berkline/Benchcraft:

   * $25 million senior secured revolving credit facility due
     2010, at B1;

   * $110 million senior secured first lien term loan due 2011, at
     B1;

   * $50 million senior secured second lien term loan due 2012, at
     B2;

   * Senior implied rating, at B1;

   * Senior unsecured issuer rating, at B3.

Moody's views the revised structure of second lien term loan as a
modest improvement to the company's credit profile.  The company's
outstanding debt will decrease by $20 million as a result of this
recapitalization, decreasing pro forma leverage (as measured by
adjusted debt/adjusted EBITDAR) to 4.4x as of August 30, 2004.

As detailed in Moody's initialization of Berkline/Benchcraft's
rating on September 29th, 2004, Berkline/BenchCraft was acquired
by management and the investment firm Code Hennessy & Simmons IV
LP in March 2002.  The rated credit facilities are a part of a
recapitalization package, which will refinance existing debt and
return funds to existing shareholders.  The company will have no
debt outstanding under its revolving credit facility as part of
this recapitalization.

The ratings reflect the recent (2002) merger of the Berkline and
BenchCraft operations and the ongoing integration of these
businesses.  The ratings also reflect the highly competitive and
fragmented nature of the residential furniture business and the
relative dependence of residential furniture sales on the general
state of the economy.  Ratings reflect the threat of increased
import penetration and the possibility that increases in raw
material costs will not be able to be passed on to the consumer,
or will be passed on with a lag.

The ratings are supported by:

   (1) the company's Berkline and BenchCraft brand names;

   (2) its broad and diversified customer and supplier base;

   (3) its wide product line;

   (4) its number one position in motion furniture and leading
       position in upholstered furniture; and

   (5) its offshore sourcing capabilities.

The company's ratings are also supported by:

   (1) the company's good liquidity;

   (2) its $25 million revolver is largely expected to be undrawn
       and limited amortization of the term loans is required.

The company has historically been and is projected to be a steady
cash flow generator with relatively limited capital expenditure
and working capital requirements.

The stable rating outlook reflects the requirement that the
company will utilize 75% of excess cash flow for debt repayment
(until leverage reaches 2.5x or less), as well as the expectation
that the residential furniture sector should continue to improve
as the economy recovers, with a positive impact on the company's
cash flow and earnings.  The outlook also reflects our expectation
that the company will not undertake additional recapitalization or
relevering transactions, or make significant acquisitions or
capital expenditures.

Ratings could be upgraded if the upturn in the residential
furniture industry continues and positively impacts
Berkline/BenchCraft and if Berkline/BenchCraft utilizes excess
cash flow for debt reduction as expected.  Ratings could be
upgraded if the company's ratio of adjusted debt/adjusted EBITDAR
falls to the 4x range or below and free cash flow/total adjusted
debt is in the range of 12-15%.

Although Moody's currently views it as unlikely, ratings could be
downgraded if:

   (1) the recovery in the residential furniture market does not
       continue;

   (2) Berkline/BenchCraft's market position deteriorates; and

   (3) credit metrics decline with adjusted debt/adjusted EBITDAR
       increasing to over 5x and free cash flow/total adjusted
       debt falling into the single digits.

Moody's rates the senior first lien secured bank facilities at the
same B1 level as the senior implied rating, as the first lien
facility will constitute the majority of the outstanding debt.
Tangible and intangible collateral does not appear to be
sufficient for the first lien facility to be notched up from the
senior implied rating, despite the first priority security
interest in all assets.  The second lien term loan is rated one
notch below the first lien term loan at B2 due to its second
priority security interest in all assets.  The senior unsecured
issuer rating, which is at the holding company, is rated two
notches below the senior implied rating at B3.

Headquartered in Morristown, Tennessee, Berkline/BenchCraft is a
leading manufacturer of motion upholstery furniture, freestanding
reclining chairs and stationary furniture.


BEXAR COUNTY: Moody's Slices Sub. Revenue Bond Rating to Ba2
------------------------------------------------------------
Moody's Investors Service downgraded these ratings on the Bexar
County Housing Finance Corporation Multifamily Housing Revenue
Bonds (American Opportunity for Housing-Cinnamon Creek
Apartments), 2002 Series A and B:

   * Senior Series 2002A downgraded to Baa2 from A3,

   * Subordinate Series 2002B downgraded to Ba2 from Baa3.

The oulook on these bonds remains negative.  The amount of debt
affected is approximately $14 million.

The ratings downgrade is prompted by Moody's review of annualized
2004 unaudited monthly reports from January 2004 through
September 30, 2004 and San Antonio rental market data.  Reports
demonstrate that the property is performing below underwritten
levels of 1.40x on the senior bonds and 1.25x on the subordinate
bonds.  Annualized 9 months of data reflect a debt service
coverage of 1.20x on the senior bond and 1.07x on the subordinate
bonds.  Net operating income has been affected by high
concessions, bad debt expenses, loss to lease expenses and
marketing expenses

The San Antonio rental market continues to perform well with third
quarter 2004 rents the highest on record.  Cinnamon Creek has
successfully instituted rental rate increases however, increases
have lagged the overall market as evidenced by high loss to lease
expenses.  The trend of rising rents may be affected by the high
rate of newly constructed units, which are expected to come on
line in the near term.  The benefit of increased rental revenues
has been largely offset by the high rates of rental concessions,
which are currently offered in the competitive San Antonio
multifamily rental market.  Physical occupancy at Cinnamon Creek
is in line with submarket performance.  The property is currently
94% occupied.

The rating outlook on the bonds continues to be negative.


BIOPHARMA ROYALTY: S&P Junks Sr. Notes Due to Low Royalty Revenues
------------------------------------------------------------------
Standard & Poor's Ratings Services lowered its 'BBB-' rating on
the senior notes issued by BioPharma Royalty Trust to 'CCC'.  At
the same time, the rating is removed from CreditWatch negative,
where it was placed August 20, 2004.

The lowered rating reflects the precipitous deterioration of the
patent royalty revenues being generated by Bristol-Myers Squibb
Co. ('A+') through the sale of the prescription drug Zerit in the
worldwide HIV/AIDS marketplace.  The rating analysis, which
included corporate and structured analysis and discussions with
Bristol-Myers, focused on industry and business fundamentals,
historical sales data, growth prospects or lack thereof,
vulnerabilities, and projected cash flows.  The overriding risk
facing this transaction is the increasing likelihood that cash
flows will be insufficient to service the rated debt and make
senior bondholders whole at the legal final maturity date,
June 6, 2006.  This rationale is supported by increased
competition and a wider array of alternative medications,
resulting in steeply declining sales and product obsolescence.

Standard & Poor's original sales projections assumed that after an
initial decline in sales from 1999 to 2000, sales would increase
at a declining rate of 5.9% per annum on average.  However, actual
sales in 2002 and 2003 were 32% and 35% lower, respectively, than
originally projected.  Moreover, full-year 2004 sales could end up
roughly 50% lower than original sales projections.  Furthermore,
actual sales for 2002 were 36% lower than 2001, were relatively
flat in 2003 (compared to 2002), and are expected to decline by
approximately 30%, on a full year basis, in 2004 (compared to
2003).  These continued sharp declines have necessitated
Standard & Poor's to again revise its base case sales forecast on
a going forward basis reflecting the continued decline in market
share of Zerit for new prescriptions, which is considered to be
irreversible.  Based on the revised sales forecasts and
corresponding royalty revenues generated by Zerit sales, the
results of the cash flows are no longer consistent with a 'BBB-'
rating.

The issuer is entitled to 70% of the royalties payable under a
licensing agreement between a major research-based academic
institution and Bristol-Myers.  Under the licensing agreement,
Bristol-Myers pays royalties based on worldwide sales of Zerit.  
Zerit sales in 1999 and 2000 totaled $605 million and
$613 million, respectively.  Subsequently, sales declined in 2001
to $546 million.  The deterioration in sales was much more
pronounced in 2002, when sales of Zerit declined to $348 million.
As a result of the deterioration in sales during 2002, the senior
notes breached their senior coverage ratio test on three
consecutive payment dates and entered early amortization, as the
breach constituted an event of default according to the
transaction documents.  Sales of Zerit during 2003 were relatively
unchanged from 2002 at $350 million.  However, 2004 sales through
the end of the second quarter have only totaled $136 million.

Zerit received regulatory approval in 1999 for use as a first line
component of a combination antiretroviral therapy regimen for
HIV-infected patients.  At the time, Zerit was the most commonly
prescribed thymadine nucleoside reverse transcriptase inhibitor --
NRTI -- for HIV therapy in the U.S.  In recent years, the HIV
virus has become increasingly resistant to NRTIs, which has led
many doctors to prescribe newer drugs.  Zerit has also proven to
have a less favorable side effect profile compared to newer drugs
in its class.  Furthermore, the global market for HIV drugs has
further developed and competition from rival drugs has become more
prevalent.

Standard & Poor's will continue to monitor the performance of the
transaction including, but not limited to, ensuring that actual
sales and the generation of royalty revenues are consistent with
Standard & Poor's revised sales forecast and corresponding
royalties generated from those sales.


BRIDGEPOINT TECH: U.S. Trustee Picks 4-Member Creditors Committee
-----------------------------------------------------------------
The United States Trustee for Region 6 appointed four creditors to
serve on an Official Committee of Unsecured Creditors in
BridgePoint Technical Manufacturing corp.'s chapter 11 case:

    1. Agilent Financial Services
       Attn: Chris Del Guidice
       1 CIT Drive
       Mail Stop 2100A
       Livingston, New Jersey 07039

    2. Test Spectrum, Inc.
       Attn: Todd Turner
       105 W. Riverside, #100
       Austin, Texas 78704

    3. Arrow Electronics
       Attn: Doug Christiansen
       7459 S. Lima St.
       Building I
       Englewood Colorado 80112-5816

    4. Met Center Partners I
       Attn: Howard Yancy
       611 W. 15th St.
       Austin, Texas 78701

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 Austin, Texas, BridgePoint Technical  
Manufacturing Corp. -- http://www.bridgept.com/-- provides  
engineering, testing, packaging, and circuit board assembly
services to semiconductor and computer companies.  The Company
filed for chapter 11 protection on September 3, 2004 (Bankr. W.D.
Tex. Case No. 04-14555).  Mark Curtis Taylor, Esq., at Hohmann &
Taube, LLP, represents the Debtor in its restructuring efforts.
When the Company filed for protection from its creditors, it
listed above $1 million in assets and above $10 million in debts.


CALPINE CORP: Posts $22.3 Million of Net Income in Third Quarter
----------------------------------------------------------------
Calpine Corporation (NYSE: CPN) reported financial and operating
results for the three and nine months ended Sept. 30, 2004.

For the three months ended Sept. 30, 2004, the company reported
net income of $22.3 million, compared to net income of
$237.8 million for the quarter ended Sept. 30, 2003.

"During the quarter, Calpine's power plant operations remained
strong, with 97% availability," stated Calpine CEO and President
Peter Cartwright. "Earnings, however, fell short of our
expectations -- primarily as a result of low market spark spreads
attributed in part to mild, below normal weather in several U.S.
power markets.

"We made significant progress on our announced liquidity enhancing
program, completing $1.5 billion of liquidity transactions. A
portion of these proceeds was used to repurchase $735 million of
existing debt. In October, we also redeemed our HIGH TIDES I and
II preferred securities.

"While we cannot predict when power prices will normalize, we are
encouraged by an improvement in spark spreads in several of
Calpine's major power markets. Moving forward, Calpine remains
committed to advancing our strategy of selling power under long-
term contracts, improving our balance sheet through the
repurchasing of debt, and enhancing liquidity."

                     2004 Third Quarter Results

In the quarter ended Sept. 30, 2004, Calpine netted approximately
$563.3 million of sales of purchased power for hedging and
optimization with purchased power expense for hedging and
optimization. This was due to the adoption on October 1, 2003, on
a prospective basis, of new accounting rules related to
presentation of non-trading derivative activity. Without this
netting, total revenue would have grown by approximately 17%
versus the reported 4% reduction in revenue. For the three months
ended Sept. 30, 2004, the company reported earnings per share of
$0.05, or net income of $22.3 million, compared to earnings per
share of $0.51, or net income of $237.8 million, for the same
quarter in the prior year. The results for the third quarter of
2004 include additional tax expense of approximately $78.8
million, which is attributable to the repatriation of net cash
proceeds from Canada to the United States following the sale of
oil and gas assets in Canada and which is mostly netted within the
discontinued operations gain. The company expects to record a
reduction of approximately $66.9 million, or $0.15 per share, of
this tax expense, in the fourth quarter of 2004 because of
provisions in The American Jobs Creation Act of 2004 signed into
law on October 22, 2004.

Calpine recognized an after-tax gain of $62.6 million, or $0.14
per share, in discontinued operations associated with the sale of
the company's Canadian natural gas reserves and petroleum assets
and the sale of its gas reserves in the Colorado Piceance Basin
and New Mexico San Juan Basin. The company also recognized an
after-tax gain of $0.23 per share on the repurchase of certain
debt issuances, compared to a gain of $0.23 per share in the same
quarter in 2003.

Gross profit decreased by $84.5 million, or 25%, to $254.4 million
in the three months ended Sept. 30, 2004, primarily due to:

      i) non-recurring other revenue of $69.4 million recognized
         in the third quarter of 2003 from the settlement of
         contract disputes with, and claims against, Enron Corp.;

     ii) the amortization of $6.2 million in the third quarter of
         2004 of the DIG C-20 gain recorded in the fourth quarter
         of 2003 due to the cumulative effect of a change in
         accounting principle;

    iii) soft market fundamentals, which caused total spark spread
         to not increase commensurately with additional
         transmission purchase expense, and depreciation costs
         associated with new power plants coming on-line.

During the three months ended Sept. 30, 2004, financial results
were affected by a $79.7 million increase in interest expense and
distributions on trust preferred securities, as compared to the
same period in 2003. This occurred as a result of higher debt
balances, higher average interest rates and lower capitalization
of interest expense as new plants entered commercial operation.
Loss before discontinued operations and cumulative effect of a
change in accounting principle was $40.2 million, or $0.09 per
share. This loss is primarily due to an effective tax rate
increase, which occurred as a result of the sale of oil and gas
assets in Canada and due to the repatriation of cash to the United
States.

For the three months ended Sept. 30, 2004, the company generated
29.4 million megawatt-hours, which equated to a baseload capacity
factor of 56%, and realized an average spark spread of $21.40 per
megawatt-hour. For the same period in 2003, Calpine generated 25.4
million megawatt-hours, which equated to a capacity factor of 60%,
and realized an average spark spread of $23.88 per megawatt-hour.

                     2004 Nine-Month Results

In the nine months ended Sept. 30, 2004, Calpine netted
approximately $1.26 billion of sales of purchased power for
hedging and optimization with purchased power expense. This was
due to the adoption on October 1, 2003, on a prospective basis, of
new accounting rules related to presentation of non-trading
derivative activity. Without this netting, total revenue would
have grown by approximately 17% versus the reported 1% reduction
in revenue. For the nine months ended Sept. 30, 2004, the company
reported a loss per share of $0.18, or a net loss of $77.6
million, compared to earnings per share of $0.41, or net income of
$162.4 million, for the same period in the prior year. The year to
date results for 2004 include additional tax expense of
approximately $78.8 million, which is attributable to the
repatriation of net cash proceeds from Canada to the United States
following the sale of oil and gas assets in Canada and which is
mostly netted within the discontinued operations gain. Calpine
expects to record a reduction of approximately $66.9 million, or
$0.15 per share, of this tax expense in the fourth quarter of 2004
because of provisions in The American Jobs Creation Act of 2004
signed into law on October 22, 2004.

Gross profit decreased by $222.9 million, or 34%, to $423.4
million in the nine months ended Sept. 30, 2004, primarily due to:

      i) non-recurring other revenue of $69.4 million recognized
         in the third quarter of 2003 from the settlement of
         contract disputes with, and claims against, Enron Corp.;

     ii) the amortization of $22.9 million in the first nine
         months of 2004 of the DIG C-20 gain recorded in the
         fourth quarter of 2003 due to the cumulative effect of a
         change in accounting principle;

    iii) soft market fundamentals, which caused total spark spread
         to not increase commensurately with additional plant
         operating expense and transmission purchase expense, and
         depreciation costs associated with new power plants
         coming on-line.

During the nine months ended Sept. 30, 2004, financial results
were affected by a $285.5 million increase in interest expense and
distributions on trust preferred securities, as compared to the
same period in 2003. This occurred as a result of higher debt
balances, higher average interest rates and lower capitalization
of interest expense as new plants entered commercial operation.
Prior year results benefited from recording $52.8 million (in
income from unconsolidated investments in power projects) from
termination of a power purchase agreement by the Acadia joint
venture.

Other income increased by $241.7 million during the nine months
ended Sept. 30, 2004, as compared to the same period in 2003,
primarily due to:

      i) pre-tax income in the amount of $171.5 million, net of
         transaction costs and the write-off of unamortized
         deferred financing costs associated with the
         restructuring of power purchase agreements for the
         company's Newark and Parlin power plants and the sale of
         an entity holding a power purchase agreement;

     ii) a $16.4 million pre-tax gain from the restructuring of a
         long-term gas supply contract net of transaction costs;
         and

    iii) a $12.3 million pre-tax gain from the King City
         restructuring transaction related to the sale of the
         company's debt securities that had served as collateral
         under the King City lease, net of transaction costs.
   
Also, during the nine months ended Sept. 30, 2004, foreign
currency transaction losses were $7.5 million, compared to a loss
of $36.2 million in the corresponding period in 2003. Calpine
recognized a gain of $0.24 per share in the nine months ended
Sept. 30, 2004 on the repurchase of certain debt issuances,
compared to a gain of $0.25 per share in the same nine-month
period in 2003, and loss before discontinued operations and
cumulative effect of a change in accounting principle was $167.5
million, or $0.39 per share, in 2004.

Discontinued operations, net of tax increased by $84.4 million
during the nine months ended Sept. 30, 2004, as compared to the
same period in 2003, as a result of the sale of oil and gas assets
in the United States and Canada during the third quarter of 2004
and the sale of the company's interest in the Lost Pines facility
in the first quarter of 2004.

For the nine months ended Sept. 30, 2004, the company generated
72.5 million megawatt-hours, which equated to a baseload capacity
factor of 51%, and realized an average spark spread of $21.19 per
megawatt-hour. For the same period in 2003, Calpine generated 62.1
million megawatt-hours, which equated to a capacity factor of 55%,
and realized an average spark spread of $23.90 per megawatt-hour.

            Liquidity and Finance Program Highlights

Calpine continues to advance on its announced program to enhance
liquidity, address near-term debt maturities and repurchase
existing indebtedness. During the past several months, Calpine
has:

   -- Completed the sale of all of its Canadian natural gas
      reserves and petroleum assets for approximately $625 million
      and sold its natural gas reserves in the Colorado Piceance
      Basin and New Mexico San Juan Basin for approximately $223
      million. A portion of the net proceeds was used to repay
      $500 million of the company's first lien indebtedness.

   -- Received funding on a preferred equity interest relating to
      Calpine's Saltend power plant. Calpine Jersey Limited
      (Calpine Jersey) issued $360 million of two-year, Redeemable
      Preferred Shares at U.S. LIBOR, plus 700 basis points.
      Calpine Jersey is an indirect, wholly owned subsidiary of
      Calpine. The net proceeds from the offering were loaned to
      Calpine's 1,200-megawatt Saltend cogeneration power plant
      located in Hull, Yorkshire, England, and will be used as
      permitted by the company's indentures.

   -- Completed its $785 million offering of 9.625% first-priority
      senior secured notes due 2014, offered at 99.212% of par.
      These notes are secured, directly and indirectly, by
      substantially all of the assets owned by Calpine, including
      its natural gas and power assets and the stock of Calpine
      Energy Services and other subsidiaries. Net proceeds
      from this offering will be used to redeem or repurchase
      existing indebtedness through open-market purchases, and as
      otherwise permitted by the company's indentures.

   -- Issued $736 million of 6% unsecured contingent convertible
      notes due 2014, offered at 83.9% of par. A portion of the
      net proceeds were used to redeem in full Calpine's HIGH
      TIDES I and HIGH TIDES II preferred securities.  The balance
      net proceeds was used to repurchase $115.0 million of its
      GH TIDES III preferred securities.

   -- In transactions initiated and completed during the third
      quarter, the company repurchased $734.8 million of the
      principal amount of its outstanding debt and its HIGH TIDES
      preferred securities as listed below:

       -- 7.625% Senior Notes Due 2006              $23,845,000
       -- 8.5% Senior Notes Due 2008                279,770,000
       -- 7.875% Senior Notes Due 2008               50,000,000
       -- 4.75% Convertible Senior Notes Due 2023   266,225,000
       -- HIGH TIDES III                            115,000,000
            Total                                  $734,840,000

      These securities were repurchased in exchange for $553.8
      million in cash.

   -- During October 2004, the company repurchased an additional
      $620.8 million of the principal amount of its outstanding
      debt and its HIGH TIDES preferred securities as listed
      below:

       -- 10.5% Senior Notes Due 2006               $2,230,000
       -- 7.625% Senior Notes Due 2006              23,000,000
       -- 8.75% Senior Notes Due 2007               10,820,000
       -- 8.5% Senior Notes Due 2008                58,500,000
       -- 8.375% Senior Notes Due 2008               7,750,000
       -- 7.875% Senior Notes Due 2008               7,000,000
       -- 8.5% Senior Notes Due 2011                28,000,000
       -- HIGH TIDES I                             198,500,000
       -- HIGH TIDES II                            285,000,000
            Total                                 $620,800,000

      These securities were repurchased in exchange for $581.1
      million in cash.

On Sept. 30, 2004, the company's liquidity totaled approximately
$2.7 billion. This included cash and cash equivalents on hand of
approximately $1.5 billion, current portion of restricted cash of
approximately $0.9 billion and approximately $0.3 billion of
borrowing capacity under various credit facilities.

               Power Plant and Natural Gas Operations

Calpine's geographically diversified portfolio of 73 natural gas-
fired, combined-cycle power generation facilities represents one
of the cleanest and most fuel-efficient fleets in North America.
Together with its 19 geothermal power plants, Calpine can deliver
26,489 megawatts of generation to power customers in 21 states,
Canada and in the United Kingdom.

    During the quarter, Calpine:

   -- Operated its natural gas-fired and geothermal power plants
      with an average plant availability factor of 97.3%, off
      slightly compared to an 98.1% average availability for the
      same period a year ago;

   -- Generated 29.4 million megawatt-hours, a 16% increase over
      the third quarter of 2003. Through hedging and optimization
      activity at its Calpine Energy Services subsidiary, the
      company delivered an additional 25.4 million megawatt-hours;

   -- Achieved an average heat rate of 7,140 British thermal units
      per kilowatt-hour, compared to a heat rate of 7,159 for the
      same period in 2003;

   -- Lowered plant operating expenses to $5.16 per megawatt-hour
      (assuming a 70% capacity factor) for the trailing twelve-
      month period ending Sept. 30, 2004, compared to $5.31 for
      the same period ending Sept. 30, 2003; and

   -- Completed construction of the 271-megawatt Goldendale Energy
      Center, located in Goldendale, Wash.

                 New Power Contract Opportunities

Calpine serves more than 100 load-serving, retail and industrial
customers across North America and in the United Kingdom. The
company is currently pursuing nearly 27,200 megawatts of contract
opportunities, with an eight-year weighted average term.

During the quarter, the company entered into 26 new power
contracts, representing approximately 1,400 megawatts of
generation for sale to large wholesale customers.

Through Sept. 30, 2004, the company has signed 67 power contracts.
The sales represent approximately 5,700 megawatts of capacity and
approximately 224 million megawatt-hours. The weighted average on-
peak spark spread for these contracts is approximately $17.00 per
megawatt-hour, with a five-year weighted average life.

Calpine is pursuing additional opportunities in the emerging
energy services sector. The company is helping meet the needs of
traditional power and retail customers as well as new entrants to
the market, including financial and banking institutions. Most
recently, Calpine signed an agreement to provide a variety of
services -- including fuel management, power marketing and gas
supply -- for three gas-fired, cogeneration power plants in New
Jersey.

Included in the Supplemental Data with this news release is an
updated report summarizing Calpine's total estimated generation
capacity and capacity currently under contract through 2009. A
full detailed report is available on the company's website on its
investor relations page at http://www.calpine.com/

            2004 Earnings and Cash Flow Guidance

For 2004, the company remains on track to achieve its $1.7 billion
of EBITDA, as adjusted for non-cash and other charges. Calpine
continues to target breakeven GAAP earnings, with the assumption
of additional bond repurchases during the fourth quarter.

                        About the Company

Calpine Corporation, celebrating its 20th year in power, is a
North American power company dedicated to providing electric power
to customers from clean, efficient, natural gas-fired and
geothermal power plants. 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. The company is listed on the
S&P 500 and was named FORTUNE's Most Admired Energy Company in
America for 2004. Calpine was founded in 1984 and is publicly
traded on the New York Stock Exchange under the symbol CPN. For
more information, visit http://www.calpine.com/

                          *     *     *

As reported in the Troubled Company Reporter on Oct. 13, 2004,
Standard & Poor's Ratings Services assigned its 'CCC+' rating to
Calpine Corp.'s (B/Negative/--) $736 million unsecured convertible
notes due 2014. The rating on the notes is the same as Calpine's
existing unsecured debt and two notches lower than the corporate
credit rating. The outlook is negative.

As reported in the Troubled Company Reporter on Oct. 25, 2004,
Fitch Ratings has withdrawn the 'CCC' rating and Stable Rating
Outlook for Calpine Corp.'s 5.75% High Tides I and 5.50% High
Tides II trust preferred securities. The rating withdrawal
reflects the full redemption of these securities.


CATHOLIC CHURCH: Portland's First Interim Chapter 11 Report
-----------------------------------------------------------
On October 8, 2004, Leonard Vuylsteke, Financial Director of the
Archdiocese of Portland in Oregon, delivered the first Chapter 11
Interim Report as required by Rule 2016-1.B. of the Local
Bankruptcy Rules of the U.S. Bankruptcy Court for the District of
Oregon.

The Interim Report provides for the financial condition of
Portland's estate:

        Estate Money             Total from Petition Date
        ------------             ------------------------
        Receipts                        $7,899,605
        Disbursements                    6,254,615
                                      ------------
        Balance on Hand                 $1,644,990

According to Mr. Vuylsteke, Portland's case is not ready for
reorganization.  The initial deadline for filing non-tort claims
has not passed, and the bar date for filing tort claims has not
yet been set.  Mr. Vuylsteke reports that objections have been
made to Portland's proposal for accelerated claims resolution, and
no procedure has yet been established.  In addition, there is
pending an adversary proceeding to determine property of the
estate.  There are also two other adversary proceedings to
determine the availability and amount of insurance to pay tort
claims.  Although all of these actions are proceeding
expeditiously, Portland does not foresee filing a plan of
reorganization and disclosure statement before May 2005.

Portland has $395,000 that could be disbursed for interim
compensation of professionals and administrative expenses at this
time without jeopardizing the viability of its estate.

The estate is currently obligated to pay a maximum of $10,000 for
administrative expenses owed to non-professionals.  Mr. Vuylsteke
says the administrative expenses consist of quarterly U.S.
Trustee fees.

The Court has appointed these professionals:

   Professional                    Duty
   ------------                    ----
   Sussman Shank LLP               General Counsel to Portland

   Schwabe Williamson & Wyatt PC   Special Litigation counsel to
                                   Portland

   Miller Nash LLP                 Special Litigation counsel to
                                   Portland

   Rothgerber Johnson & Lyons LLP  Special Constitutional Law
                                   counsel to Portland

   Tonkon Torp LLP                 Counsel to the Official
                                   Committee of Tort Claimants

   KPMG LLP                        Accountants to Portland

The Roman Catholic Church of the Diocese of Tucson filed for
chapter 11 protection (Bankr. D. Ariz. Case No. 04-04721) on
September 20, 2004, and delivered a plan of reorganization to the
Court on the same day.  Susan G. Boswell, Esq., Kasey C. Nye,
Esq., at Quarles & Brady Streich Lang LLP, represent the Tucson
Diocese.  The Archdiocese of Portland in Oregon filed for
chapter 11 protection (Bankr. Ore. Case No. 04-37154) on July 6,
2004.  Thomas W. Stilley, Esq. and William N. Stiles, Esq. of
Sussman Shank LLP represent the Portland Archdiocese in its
restructuring efforts.  Portland's Schedules of Assets and
Liabilities filed with the Court on July 30, 2004, the Portland
Archdiocese reports $19,251,558 in assets and $373,015,566 in
liabilities.  (Catholic Church Bankruptcy News, Issue No. 8;
Bankruptcy Creditors' Service, Inc., 215/945-7000)


CATHOLIC CHURCH: Judge Perris Extends Portland's Exclusive Periods
------------------------------------------------------------------
The Archdiocese of Portland in Oregon asks the U.S. Bankruptcy
Court for the District of Oregon to extend the time within which
it has the exclusive right to file and solicit acceptances of a
reorganization plan.

Portland wants the Exclusive Plan Filing Period extended until
August 1, 2005, and the Exclusive Solicitation Period extended
until September 30, 2005.

Under Sections 1121(b) and (c)(3) of the Bankruptcy Code,
Portland has the exclusive right to file a plan until 120 days
after the Petition Date and to obtain acceptance of that plan
until 180 days after the Petition Date.

Thomas W. Stilley, Esq., at Sussman Shank, LLP, explains that the
extension of the Exclusive Periods is necessary to provide
Portland sufficient time to:

   -- attempt to resolve numerous issues with the Official
      Committee of Tort Claimants associated with a deadline
      for filing tort claims;

   -- provide notice of the Tort Claims Bar Date to persons who
      may be entitled to assert a tort claim once the Tort Claims
      Bar Date is set;

   -- identify the number and amount of tort claims being
      asserted against it;

   -- finalize an implement its proposed Plan of Accelerated
      Claims Resolution Process to liquidate all or a majority of
      the tort claims; and

   -- attempt to resolve or litigate disputes with its insurers
      over coverage issues.

An extension also gives tort claimants more time to file proofs of
claim.  Moreover, an extension allows Portland sufficient time to
discuss and negotiate a consensual reorganization plan with the
Tort Claimants Committee and individual tort claimants.

Portland was the first diocese in the United States to take the
unprecedented step of filing for bankruptcy.  The size and
complexity of its case is unprecedented in the District of
Oregon.

Mr. Stilley reminds the Court that Portland faces at least 60
pending tort claims alleging millions of dollars in damages and an
unknown number of other unfilled and potential future claims.  
Portland has not yet finalized a plan because of the amount of
claims is far from certain.  It also unclear what property must be
included in its estate.  Unless at least the amount of the claims
is resolved, or the claims have been estimated for purposes of
confirmation, it will be almost impossible for Portland to propose
a confirmable plan.

Mr. Stilley relates that Portland has been working in good faith
towards the negotiation of the essential elements of a Chapter 11
plan and the expeditious resolution of its case.  Mr. Stilley
assures Judge Perris that the extension is not intended to
pressure creditors, and will not prejudice any creditors'
interest.  Moreover, Mr. Stilley notes that Portland has been
paying its postpetition bills on time and is not in default.

                          *     *     *

Judge Perris extends Portland's Exclusive Plan Filing Period until
June 1, 2005, and its Exclusive Solicitation Period until
July 31, 2005.

The Roman Catholic Church of the Diocese of Tucson filed for
chapter 11 protection (Bankr. D. Ariz. Case No. 04-04721) on
September 20, 2004, and delivered a plan of reorganization to the
Court on the same day.  Susan G. Boswell, Esq., Kasey C. Nye,
Esq., at Quarles & Brady Streich Lang LLP, represent the Tucson
Diocese.  The Archdiocese of Portland in Oregon filed for
chapter 11 protection (Bankr. Ore. Case No. 04-37154) on July 6,
2004.  Thomas W. Stilley, Esq. and William N. Stiles, Esq. of
Sussman Shank LLP represent the Portland Archdiocese in its
restructuring efforts.  Portland's Schedules of Assets and
Liabilities filed with the Court on July 30, 2004, the Portland
Archdiocese reports $19,251,558 in assets and $373,015,566 in
liabilities.  (Catholic Church Bankruptcy News, Issue No. 8;
Bankruptcy Creditors' Service, Inc., 215/945-7000)


CHAPCO CARTON: Creditors Must File Proofs of Claims by Nov. 15
--------------------------------------------------------------
The U.S. Bankruptcy Court for the Northern District of Illinois
set November 15, 2004, as the deadline for all creditors owed
money by Chapco Carton Company on account of claims arising prior
to July 13, 2004, to file their proofs of claim.

Creditors must file their written proofs of claim on or before the
November 15 Claims Bar Date, and those forms must be delivered to:

Clerk of the Bankruptcy Court
Northern District of Illinois, Eastern Division
Room 710, 219 South Dearborn Street
Chicago, Illinois 60604

Headquartered in Bolingbrook, Illinois, Chapco Carton Company  
-- http://www.chapcocarton.com/-- manufactures, sells and   
distributes folding cartons used for retail packaging in food,  
candy, office supplies and automotive parts industries. Chapco
Carton filed for chapter 11 protection on July 13, 2004  
(Bankr. N.D. Ill. Case No. 04-26000). Chad H. Gettleman, Esq., at  
Adelman Gettleman & Merens, represents the Company in its  
restructuring efforts. When the Debtor filed for protection from  
its creditors, it listed $15,232,256 in assets and $19,220,379 in  
liabilities.


CHARTER COMMS: Sept. 30 Stockholders' Deficit Narrows to $4 Mil.
----------------------------------------------------------------
Charter Communications, Inc. (NASDAQ: CHTR) (along with its
subsidiaries, the Company) reported financial and operating
results for the three months ended September 30, 2004. The Company
also provided pro forma results, which reflect the sales of
certain cable systems in March and April 2004 and October 2003 as
if these sales occurred on January 1, 2003.  

                            Highlights

The Company reported the following highlights in the quarter:

   -- Third quarter HSD revenues increased 34% year over year on a
      pro forma basis as a result of strong unit and revenue per
      HSD customer growth. Added 108,500 residential high-speed
      data (HSD) customers during the third quarter and 378,400
      over the past 12 months.

   -- Third quarter commercial services revenues increased 27% and
      third quarter advertising sales revenues increased 18% on a
      pro forma basis compared to the third quarter of 2003.

   -- Video revenue per customer increased 3%, HSD revenue per
      customer increased 5% and overall revenue per customer
      increased 10% for the third quarter of 2004 compared to the
      pro forma year ago period.

   -- Telephony ready homes passed totaled 508,100 homes at
      September 30, 2004, a five-fold increase over September 30,
      2003. Telephony customers increased 67% to 40,200 compared
      to the year ago period.

   -- Digital customers with high definition services grew from
      less than 16,500 at December 31, 2003 to 76,000 at the end
      of the third quarter 2004. Digital video recorders units
      grew to 61,000 at September 30, 2004.

   -- Revenue grew 8% and adjusted EBITDA 2% on a pro forma basis
      for the third quarter of 2004 compared to the third quarter
      of 2003. Q3 Adjusted EBITDA on a pro forma basis represents
      37.7% of revenues. For the three months ended September 30,
      2004, Charter reported 3% revenue growth and a 3% decline in
      adjusted EBITDA on an actual basis compared to third quarter
      2003.  

Charter President and CEO Carl Vogel said, "We're pleased with the
performance of our high-speed data product evidenced by strong
unit and revenue per customer growth as compared to the second
quarter and prior periods. The recent product enhancements and
migration to a two-speed service choice have proven successful as
third quarter 2004 average revenue per HSD customer has increased
5% compared to the year ago period. Our strategy of combining
differentiated advanced services with our core products in a
digital format combined with our high-speed data services is
proving to be successful in increasing revenue per customer as
revenue growth continues to accelerate each quarter in 2004. Our
challenge continues to be in the analog video category. We have a
number of initiatives in place to continually improve customer
service and adjust our packages and pricing to address competitive
pressures in many markets. We also continue to focus on wider
deployment of advanced services like voice over IP, video on
demand, digital video recorders and high definition television in
as many markets as financially possible."

                     Third Quarter Results

Third quarter 2004 revenues were $1.248 billion, an increase of
$89 million, or 8%, over pro forma third quarter 2003 revenues of
$1.159 billion and increase of 3% over third quarter actual
revenues of $1.207 billion. The increases in revenues are
principally the result of growth in HSD revenues as well as
increased commercial revenues and advertising sales. For the three
months ended September 30, 2004, HSD revenues increased $48
million, or 34%, on a pro forma basis, reflecting 378,400
additional HSD customers since September 30, 2003. In addition,
third quarter 2004 average monthly revenue per HSD customer
increased 5% compared to third quarter 2003 pro forma average
monthly HSD revenue. Commercial revenues increased $13 million, or
27%, on a pro forma basis and advertising sales revenues increased
$11 million, or 18%, on a pro forma basis compared to the year ago
quarter. Video revenues increased 1% on a pro forma basis compared
to the third quarter of 2003.

Third quarter 2004 operating costs and expenses were $777 million,
an increase of $82 million, or 12%, on a pro forma basis and an
increase of $58 million, or 8%, on an actual basis, compared to
the year ago period. The rise in third quarter 2004 operating
costs and expenses was primarily a result of a 12% increase in
programming costs, a 15% increase in service costs from ongoing
infrastructure maintenance and an 11% increase in general and
administrative costs primarily due to increases in costs
associated with improving customer care and costs to address our
growing commercial business compared to the year ago pro forma
period.

Charter reported a loss from operations of $2.344 billion for the
third quarter 2004 compared to third quarter 2003 income from
operations of $104 million on a pro forma basis and $117 million
on an actual basis. The change in income (loss) from operations
primarily resulted from the recognition of a $2.433 billion charge
for the impairment of franchises for the three months ended
September 30, 2004 due to the use of a lower projected growth rate
in the Company's valuation, resulting in revised estimates of
future cash flows. An increase in depreciation and amortization
also unfavorably impacted income (loss) from operations in the
comparison of third quarter of 2004 to the same 2003 period.

Net loss applicable to common stock and loss per common share for
the third quarter of 2004 were $3.295 billion and $10.89,
respectively. For the third quarter of 2003, Charter reported
actual net income applicable to common stock and basic earnings
per common share of $36 million and 12 cents, respectively. The
difference between net loss applicable to common stock for third
quarter 2004 and net income applicable to common stock for the
same year ago period was primarily the result of non-cash items,
including the impairment charge of $2.433 billion and the
cumulative effect of accounting change of $765 million recorded in
the third quarter of 2004 and the $267 million gain on the
exchange of debt in the third quarter of 2003, partially offset by
a $185 million increase in income tax benefit.

                       Year to Date Results

For the nine months ended September 30, 2004, Charter generated
pro forma revenues of $3.672 billion, an increase of 6% over pro
forma revenues of $3.457 billion for the year ago period. Pro
forma revenue growth is due primarily to a $144 million, or 37%,
increase in HSD revenues year over year. For the first nine months
of 2004, pro forma commercial revenues increased $36 million, or
26%, and pro forma advertising sales revenues increased $22
million, or 12%, compared to the pro forma year ago period. Actual
revenues for the first three quarters of 2004 of $3.701 billion
increased 3% over actual revenues of $3.602 billion for the same
year ago period.

Pro forma operating costs and expenses for the nine months ended
September 30, 2004 totaled $2.271 billion, up $186 million, or 9%,
compared to the year ago pro forma period, primarily a result of
increased programming and service costs. Actual operating costs
and expenses of $2.287 billion for the first three quarters of
2004 increased 6% compared to actual operating costs and expenses
for the same 2003 period.

For the nine months ended September 30, 2004, pro forma loss from
operations totaled $2.266 billion compared to net income of $267
million for the same pro forma 2003 period as a result of the
$2.433 billion impairment charge described earlier, special
charges of $100 million primarily consisting of $85 million
related to the settlement of class action lawsuits, which are
subject to final documentation and court approval, and option
compensation costs of $34 million. For the first nine months of
2004, actual loss from operations totaled $2.154 billion compared
to net income from operations of $306 million for the actual year
ago period due to the same factors impacting the change in pro
forma results, partially offset by the $105 million pre-tax gain
on the sale of cable systems recorded in the first nine months of
2004.

                     Third Quarter Liquidity

Adjusted EBITDA totaled $471 million for the three months ended
September 30, 2004, an increase of $7 million, or 2%, on a pro
forma basis and a decrease of $17 million, or 3% on an actual
basis, compared to the year ago period. Net cash flows from
operating activities for the third quarter of 2004 were $215
million, compared to $353 million for the year ago quarter,
primarily as a result of a $71 million increase in interest on
cash pay obligations and a $59 million increase in cash used by
operating assets and liabilities primarily resulting from the
benefit in the third quarter of 2003 from collection of
receivables from programmers related to prior period network
launches.

Expenditures for property, plant and equipment for the third
quarter of 2004 totaled $249 million, an increase of approximately
4% from third quarter 2003.

Charter reported un-levered free cash flow of $222 million for the
third quarter of 2004, compared to pro forma un-levered free cash
flow of $231 million and actual un-levered free cash flow of $249
million in the third quarter of 2003.

Charter reported negative free cash flow of $128 million for the
third quarter of 2004 compared to pro forma negative free cash
flow of $41 million and actual negative free cash flow of $30
million for the third quarter of 2003. The increases are primarily
the result of a $78 million and $71 million increase in interest
on cash pay obligations on a pro forma and actual basis,
respectively.

                     Year to Date Liquidity

Pro forma adjusted EBITDA totaled $1.401 billion for the nine
months ended September 30, 2004, an increase of $29 million, or
2%, compared to the year ago pro forma period of $1.372 billion.
Actual adjusted EBITDA totaled $1.414 billion for the first three
quarters of 2004, a 2% decline compared to actual first three
quarters 2003 adjusted EBITDA of $1.443 billion.

Actual net cash flows from operating activities for the nine
months ended September 30, 2004, were $383 million, a decrease of
40% from $638 million reported a year ago, primarily a result of
the $146 million increase in interest on cash pay obligations and
an $80 million increase in cash used by operating assets and
liabilities, primarily due to changes in the timing of cash
receipts previously discussed.

Actual expenditures for property, plant and equipment for the
first nine months of 2004 totaled $639 million, an increase of
approximately 27% from the first nine months of 2003 when capital
expenditures totaled $503 million. The increase in capital
expenditures resulted from increased purchases of customer premise
equipment, primarily for high definition television and digital
video recorders. Expenditures for scalable infrastructure related
to the deployment of these advanced services as well as for
commercial and residential HSD services also increased during the
first nine months of 2004.

Charter reported actual un-levered free cash flow of $775 million
for the nine months ended September 30, 2004, compared to un-
levered free cash flow of $940 million in the first nine months of
2003. Pro forma un-levered free cash flow was $764 million and
$882 million for the nine months ended September 30, 2004 and
2003, respectively. The decline in un-levered free cash flow was
primarily the result of increased capital expenditures as
previously discussed.

The increase in capital expenditures along with increased interest
on cash pay obligations resulted in actual negative free cash flow
of $215 million for the first nine months of 2004, compared to
actual free cash flow of $96 million for the first nine months of
2003. Pro forma negative free cash flow was $222 million for the
first nine months of 2004 compared to pro forma free cash flow of
$59 million for the first three quarters of 2003.

At September 30, 2004, the Company had $18.5 billion of
outstanding indebtedness, and $129 million cash on hand. Net
availability of funds under the Charter Operating credit
facilities was approximately $957 million at September 30, 2004.

It is likely that Charter or Charter Communications Holding
Company, LLC will require additional funding to repay debt
maturing in 2005 and 2006. We are working with our financial
advisors to address such funding requirements, however, there can
be no assurance that such funding will be available to us.
Although Paul Allen, Charter's largest shareholder and Chairman of
the board of directors, and his affiliates have purchased equity
from us in the past, Mr. Allen and his affiliates are not
obligated to purchase equity from, contribute to or loan funds to
us in the future.

                        Operating Statistics

All year over year changes in operating statistics are pro forma
for the sales of certain cable systems to Atlantic Broadband
Finance, LLC and WaveDivision Holdings, LLC.

Charter ended the third quarter with 10,623,600 RGUs, a net
increase of 97,600 RGUs during the third quarter of 2004. The
increase in RGUs was driven by a net gain of 108,500 residential
HSD customers during the quarter. Charter grew the digital
customer base by 38,700, while the analog video customer base
declined by 58,600 customers. The Company's telephony customer
base increased by 9,000 customers, or nearly 29%.

As of September 30, 2004, Charter served 6,074,600 analog video,
2,688,900 digital video and 1,819,900 residential high-speed data
customers. The Company also served 40,200 telephony customers as
of September 30, 2004.

The Company increased RGUs by 348,700 during the 12 months ended
September 30, 2004, driven by an increase in HSD customers of
378,400 and digital customers of 118,600. The increases in HSD and
digital video customers were partially offset by a decrease in
analog video customers of 164,400 over the 12 months ended
September 30, 2004. Charter added 16,100 telephony customers
during that same period.

                        Other Matters

On an annual basis, the 2004 pro forma revenue growth rate is
expected to be greater than or equal to the as reported 2003
revenue growth rate of 6%. The pro forma 2004 adjusted EBITDA
growth rate is not expected to exceed the actual as reported 2003
adjusted EBITDA growth rate of 7%.

                  About Charter Communications

Charter Communications, Inc., a broadband communications company,
provides a full range of advanced broadband services to the home,
including cable television on an advanced digital video
programming platform via Charter Digital(TM) and Charter High-
Speed(TM) Internet service. Charter also provides business-to-
business video, data and Internet protocol (IP) solutions through
Charter Business(TM). Advertising sales and production services
are sold under the Charter Media(R) brand. More information about
Charter can be found at http://www.charter.com/

At Sept. 30, 2004, Charter Communications' balance sheet showed a
$4 million stockholders' deficit, compared to a $175 million
deficit at Dec. 31, 2003.


CLARK GROUP: Confirmation Hearing Set for November 10
-----------------------------------------------------
The Honorable James J. Barta of the U.S. Bankruptcy Court for the
Eastern District of Missouri will convene a combined hearing at
2:00 p.m., on Wednesday, November 10, 2004, to:

    -- determine the adequacy of the Disclosure Statement prepared
       by Clark Group, Inc., and its debtor-affiliates, to explain
       their joint prepackaged Plan of Reorganization and

    -- consider confirmation of the Debtors' Plan.

The Debtors and Sierra Craft, Inc., requested an expedited
concurrent hearing on the confirmation of the proposed Plan and
Disclosure Statement because of the November 15, 2004, deadline
for the entry of a confirmation order in accordance with the Asset
Purchase Agreement between the Debtors and Sierra Craft.

A full text copy of the Plan and Disclosure Statement is available
for a fee at:

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

The Plan provides for:

    a) the sale of substantially all of the Debtors' respective
       assets, other than the Excluded Assets, to Sierra Craft,
       Inc. in exchange for the Purchase Consideration on the
       Effective Date in accordance with the Asset Purchase
       Agreement between the Debtors and Sierra Craft, Inc.;

    b) the substantive consolidation of the Debtors for purposes
       of classification and treatment of Allowed Claims and
       distributions to Holders under the Plan;

    c) the payment in full of all Allowed Secured Claims, other
       than the Victaulic Company of America, Inc. Secured Claims,
       on the Effective Date;

    d) the payment in full of all Allowed Unclassified Claims on
       the Effective Date and 50% of all Allowed Convenience
       Claims on the Effective Date;

    e) the formation of the  Liquidation Trust to receive and
       distribute the remaining Net Proceeds of the Purchase
       Consideration, and the proceeds from the sale of the
       Excluded Assets, to Holders of Allowed Class 4A and Class
       4B Claims, and, to a limited extent if certain
       contingencies are satisfied, to the Holder of the Allowed
       Victaulic Company Secured Claims, on each Quarterly
       Distribution Date; and

    f) certain waivers, releases, injunctions and exculpations
       with respect to the Debtors, Sierra Craft, and various
       third-parties, including the Debtors' principal Secured
       creditors.

Votes on the Plan were solicited from holders of claims in all
impaired classes entitled to vote prior to the Petition Date.  An
overwhelming majority of all impaired classes entitled to vote
accepted the Plan:

Class  Class Description              Status      Voting Result
-----  -----------------              ------      -------------
2D     Victaulic Secured Claims       Impaired    100% Accepted
2E     Other Secured & Setoff Claims  Impaired    100% Accepted
3      Convenience Claims             Impaired    94.44% Accepted
4A     General Unsecured Claims       Impaired    68.75% Accepted
4B     Disputed Litigation Claims     Impaired    100% Rejected

Headquartered in St. Louis, Missouri, Clark Group, Inc. --  
http://www.clarksprinkler.com/-- provides a comprehensive line of   
fire protection products and the highest quality service and  
expert knowledge on fire protection products.  The Company and its  
debtor-affiliates filed for chapter 11 protection on October 1,  
2004 (Bankr. E.D. Mo. Case No. 04-52536).  Bonnie L. Clair, Esq.,  
at Summers, Compton, Wells & Hamburg, PC, represent the Debtors in  
their restructuring efforts.  When the Company filed for
protection from its creditors, it listed total assets and debts of  
over $10 million.


CLARK GROUP: Wants to Hire Summers Compton as Bankruptcy Counsel
----------------------------------------------------------------
Clark Group, Inc. and its debtor-affiliates ask the U.S.
Bankruptcy Court for the Eastern District of Missouri for
permission to employ Summers, Compton, Wells & Hamburg, P.C., as
their bankruptcy counsel.

Summers Compton is expected to:

    (a) provide the Debtors with legal advice with respect to
        their duties and powers in the administration of their
        bankruptcy case in connection with the continued operation
        of their business and financial affairs;

    (b) assist the Debtors in obtaining the approval of their
        prepackaged Plan of Reorganization and negotiating and
        formulating any modifications to that Plan;

    (c) assist the Debtors in obtaining authority to sell assets
        and businesses not being purchased by Sierra Craft Inc.
        pursuant to the Asset Purchase Agreement between the
        Debtors and Sierra Craft;

    (d) Consult with the United States Trustee and any committee
        formed in the Debtors' chapter 11 cases concerning matters
        arising in their bankruptcy proceedings; and

    (e) perform other legal services as necessary in connection
        with fulfilling the duties of representing the Debtors in
        their chapter 11 cases.

David A. Sosne, Esq., and Bonnie L. Clair, Esq., both Principals
at Summers Compton, are the lead attorneys for the Debtors'
restructuring.  Mr. Sosne discloses that the Firm received a
$138,000.00 retainer. For their professional services, Mr. Sosne
will bill the Debtors $240 per hour while Ms. Clair will charge at
$200 per hour.

Mr. Sosne reports Summers Compton's lead professionals bill:

    Professional         Designation     Hourly Rate
    ------------         -----------     -----------     
    Neil H. Miller       Counsel            $225
    Brian J. LaFlamme    Associate           165
    Sharon A. Wentzel    Paralegal            85

Mr. Sosne reports other Summers Compton professionals bill:

    Designation          Hourly Rate
    -----------          -----------
    Counsel/Principal    $200 - 250
    Associates            150 - 195
    Paralegal             85  - 100

To the best of the Debtors' knowledge, Summers Compton is
"disinterested" as the term is defined in Section 101(14) of the
Bankruptcy Code.

Headquartered in St. Louis, Missouri, Clark Group, Inc. --  
http://www.clarksprinkler.com/-- provides a comprehensive line of   
fire protection products and the highest quality service and  
expert knowledge on fire protection products.  The Company and its  
debtor-affiliates filed for chapter 11 protection on October 1,  
2004 (Bankr. E.D. Mo. Case No. 04-52536).  Bonnie L. Clair, Esq.,
and David A. Sosne, Esq., at Summers, Compton, Wells & Hamburg,
PC, represent the Debtors in their restructuring efforts.  When
the Company filed for protection from its creditors, it listed
total assets and debts of over $10 million.


CLEARLY CANADIAN: Inks C$1.5 Million Secured Loan with Global
-------------------------------------------------------------
Clearly Canadian Beverage Corporation (OTCBB:CCBC) (TSX:CLV) has
made arrangements for a secured loan in the aggregate amount of up
to Cdn$1.5 million.

The Company has signed a term sheet with Global (GMPC) Holdings
Inc. of Toronto, Ontario for a Cdn$1,500,000 loan, to be advanced
in two tranches, for a term of twelve months.  The advance of the
first tranche of Cdn$1,000,000 will be subject to the execution by
the Company of definitive loan and security agreements, and the
advance of the second tranche of Cdn$500,000 will be subject to
the Company meeting certain property valuation requirements.  The
loan will bear interest at a rate of 12% per annum compounded and
payable monthly.  The Company has agreed to issue to Global
600,000 common shares as a bonus in connection with the first
tranche of the loan and an additional 220,000 common shares for
the second tranche of the loan.

The net proceeds of the loan will be used to repay in full all
amounts remaining outstanding under the Company's previous bridge
loan from Quest Capital Corp.  (approximately Cdn$665,000) and for
general working capital purposes.  In connection with, and upon
completion of the first tranche of the loan, Y&R Investment
Capital Inc. will receive a cash fee of Cdn$25,000 and will also
receive 175,000 common shares of the Company for arranging the
loan with Global.

At this time, the Company also continues to pursue additional
private financing to support the Company's operations and
relations with existing suppliers and vendors and to allow for
more aggressive marketing and sales activities for its beverage
products.

The funding of the loan by Global is also subject to its
completion of satisfactory due diligence.  Additionally, the loan
and the issuance of the bonus shares, and related fees are subject
to regulatory approval.

                           About Global

Global is a merchant bank which provides bridge loan services
(asset back/collateralized financing), to companies across many
industries such as oil & gas, mining, real estate, manufacturing,
retail, financial services, technology and biotechnology.  
For further information, please contact Jason G. Ewart at
(416) 488-7760 or visit http://www.globalbridgeloans.com/

                        About the Company

Based in Vancouver, B.C., Clearly Canadian Beverage Corporation
markets premium alternative beverages and products, including
Clearly Canadian(R) sparkling flavoured water, Clearly Canadian
O+2(R) oxygen enhanced water beverage and Tre Limone(R) which are
distributed in the United States, Canada and various other
countries.  Additional information about Clearly Canadian may be
obtained on the world wide web at http://www.clearly.ca/

                          *     *     *

                       Going Concern Doubt

In its Form 20-F for the fiscal year ended December 31, 2003,
filed with the Securities and Exchange Commission, Clearly
Canadian Beverage Corporation reported a working capital deficit
of $2,660,000 at December 31, 2003, compared to a working capital
surplus of $24,000 at December 31, 2002.

Due to the Company's recurring losses from operations, net deficit
and lack of working capital for the Company's planned business
activities, there is substantial doubt as to the Company's ability
to continue as a going concern.

The Company has recognized the decrease in working capital and
cash resources in recent years and has taken steps intended to
improve its working capital position.  In that respect, in 2001
the Company appointed McDonald Investments Inc. as its investment
banker and financial advisor to evaluate various strategic
options, including possible divestitures of certain assets as well
as acquisition opportunities.  To this end, in April 2001, the
Company's U.S. subsidiary, CC Beverage, completed the sale of its
home and office water business assets.  The total sales proceeds
were $4.8 million, which was used to pay down certain debt
obligations and improve the Company's working capital position.
Also, in February 2002, the Company's U.S. subsidiary, CC
Beverage, finalized the sale of certain production facility assets
and a bottling plant lease located in Burlington, Washington, as
well as its Cascade Clear water business and its private label co-
pack business to Advanced H2O, Inc. of Bellevue, Washington. AH2O
acquired CC Beverage's production facility assets for $4,348,600,
which purchase price included $2,130,000 in cash, the assumption
of long-term indebtedness of approximately $2,155,000 and the
assumption of certain capital equipment leases of $63,600.  The
proceeds from the sale of the various assets to AH2O were used for
general working capital purposes, to reduce debt and to provide
additional funding for the marketing and distribution of the
Company's beverages.


COMFORCE CORP: Sept. 30 Balance Sheet Upside-Down by $37.5 Million
------------------------------------------------------------------
COMFORCE Corporation (Amex: CFS), a leading provider of high-tech
professional staffing, consulting and outsourcing services,
reported results for its third quarter ended September 26, 2004.

Revenues for the quarter increased 32.4% to $123.4 million,
compared to revenues of $93.2 million for the third quarter of
2003. Sequentially revenues increased 5.0%, compared to revenues
of $117.6 million for the second quarter of 2004. The improvement
in revenues was primarily attributable to the continued strong
growth in PRO Unlimited representing the Human Capital Management
segment. For the quarter, PRO's revenues grew to $70.1 million, a
50.2% increase over the same quarter last year. Staff Augmentation
revenues also grew by 15.3% due primarily to increases in
Technical Services, which includes Government Staffing, of 28.7%
and Information Technologies of 9.9%.

Gross profit for the third quarter of 2004 was $17.5 million, or
14.2% of revenues, compared to $15.2 million, or 16.3% of revenues
in the third quarter of 2003. Operating income for the third
quarter was $3.4 million, compared to an operating loss of $(26.5)
million for the same quarter of last year. The 2003 third quarter
operating loss included a non-cash charge for goodwill impairment
in the amount of $28.0 million. Excluding this non-cash charge,
the 2003 operating income was $1.5 million. As a percentage of
sales, operating income was 2.7% in the third quarter of 2004,
compared to 1.6%, excluding the non-cash charge, in the third
quarter of 2003.

Interest expense was $3.0 million for the third quarter of 2004,
compared to $3.3 million for the same quarter last year. As
previously announced, a reduction in COMFORCE's public debt of
approximately $70.0 million since June 2000, has enabled the
Company to reduce its annual interest expense by approximately
$7.5 million, including borrowing at the lower rates available
under its bank credit facilities to effectuate repurchases of
public debt and by exchanging preferred equity and lower interest
rate convertible notes for this public debt.

The Company recorded income from continuing operations before
income taxes of $486,000 in the third quarter of 2004, compared to
a loss from continuing operations before income taxes of $(29.8)
million in 2003. The Company recorded a tax provision of $354,000
in the third quarter of 2004, compared to a tax benefit of $3.7
million in the third quarter of 2003.

COMFORCE reported net income of $132,000 or $0.00 per basic and
diluted share for the third quarter of 2004, compared to a net
loss of $(26.1) million, or $(1.59) per basic and diluted share
for the same period last year. The loss for third quarter 2003 was
primarily the result of the aforementioned non-cash charge for
goodwill impairment.

                         Nine-Month Results

COMFORCE reported revenues of $348.4 million, a 30.4% increase for
the first nine months of 2004, compared to revenues of $267.1
million in the comparable year period. Revenues were favorably
impacted by the continued strong performance of PRO Unlimited and
certain sectors of Staff Augmentation, particularly Technical
Services.

Operating income for the first nine months of 2004 was $9.3
million, compared to an operating loss of $(21.8) million in the
first nine months of 2003. In the first nine months of 2003, under
the provisions of SFAS 142, the Company recorded a non-cash charge
for goodwill impairment in the amount of $28.0 million. Excluding
the non-cash charge of $28.0 million, operating income for the
first nine months of 2003 was $6.2 million. Also, included in the
first nine months of 2003 was a $1.6 million insurance recovery
related to a non-cash charge for uncollectible funding and service
fees receivable.

Interest expense for the first nine months of 2004 was $9.2
million, compared to interest expense of $10.7 million for the
same period last year.

During the first nine months of 2004 the Company repurchased $14.8
million principal amount of Senior Notes resulting in a gain on
debt extinguishment for the Company of $2.0 million. As a result
of the Company's repurchase of 12% Senior Notes in the second
quarter of 2003, and the Company's exchange and repurchase of 15%
PIK Debentures in the first quarter of 2003, the Company
recognized a gain on the extinguishment of debt of $8.8 million in
the first nine months of 2003.

Income from continuing operations before income taxes was $2.1
million for the first nine months of 2004, compared to a loss from
continuing operations before income taxes of $(23.5) million for
the same period last year. The Company recorded a tax provision of
$1.1 million in the first nine months of 2004 and a tax provision
of $8,000 in the first nine months of 2003.

The Company recorded net income of $984,000, or $0.04 per basic
and diluted share for the first nine months of 2004, compared to
net loss of $(23.4) million, or $(1.44) per basic and diluted
share for the first nine months of 2003, principally due to the
$28.0 million write-off of goodwill.

                       Management Comments

John Fanning, Chairman and Chief Executive Officer of COMFORCE
commented, "It gives us great pleasure to report our third
consecutive quarter of double digit revenue growth year over year.

"As our numbers indicate, PRO Unlimited was the major contributor
in our overall growth, both for the quarter and our first nine
months. PRO, as a market leader in human capital management,
continues to experience an increasing demand for their services,
particularly from Fortune 500 companies. We expect to see this
trend continue as the economy further strengthens.

"Staff Augmentation is also experiencing increased revenue growth.
This has been particularly true in Technical Staffing, which
includes our Government Staffing division, where we experienced a
marked increase in revenue for the quarter. Technical staffing
rose 28.7% in the third quarter.

"We continue to put an emphasis on RightSourcing Vendor
Management, within Healthcare Support Services and believe it
represents an exciting opportunity for future growth.

"Demand is also increasing in our Information Technology sector,
where we realized our third sequential quarter of revenue
improvement. We believe that this is a clear indicator of recovery
and increased spending in this sector. The positive response to
our Sarbanes-Oxley specialists also contributed to this revenue
growth.

"I am also pleased to report that during the quarter we signed an
amended agreement with our credit facility, which will provide us
with greater financial flexibility to buy back more of the 12%
Senior Notes."

Mr. Fanning concluded, "This has been a very rewarding and
productive nine months for COMFORCE. We remain committed to
investing in and growing all areas of our business and gaining
market share. At the same time we will look to manage our costs.
We expect to report sound performance for the balance of 2004."

                        About the Company

COMFORCE Corporation provides specialty staffing, consulting and
outsourcing services primarily to Fortune 500 companies. The
Company operates in three business segments -- Human Capital
Management Services, Staff Augmentation, and Financial Outsourcing
Services. The Human Capital Management Services segment provides
consulting services for managing the contingent workforce through
its PRO Unlimited subsidiary. The Staff Augmentation segment
provides Healthcare Support Services, including RightSourcing
Vendor Management Services, and Nurse Staffing Services, Sarbanes-
Oxley Specialists, Technical Services, Information Technology
(IT), Telecom, and Other Staffing Services. The Financial
Outsourcing Services segment provides payroll, funding and
outsourcing services to independent consulting and staffing
companies. COMFORCE has thirty-six (36) offices nationwide.

At Sept.26, 2004, COMFORCE Corp.'s balance sheet showed a
$37,503,000 stockholders' deficit, compared to a $38,624,000
deficit at Dec. 28, 2003.


COMM 2004-RS1: Fitch Puts Low-B Ratings on Six Securities Classes
-----------------------------------------------------------------
Fitch rated these COMM 2004-RS1 Commercial Mortgage Related
Securities, series 2004-RS1:

   -- $220,600,000 class A 'AAA'
   -- $314,364,000* class XP 'AAA'**
   -- Class IO-1 'AAA'**
   -- Class IO-2 'AAA'**
   -- $39,020,000 class B-1 'AA'
   -- $41,298,000 class B-2 'AA'
   -- $3,386,000 class C 'AA-'
   -- $12,955,000 class D 'A'
   -- $4,318,000 class E 'A-'
   -- $3,023,000 class F 'BBB+'
   -- $2,056,000 class G 'BBB-'
   -- $2,176,000 class H 'BB+'
   -- $725,000 class J 'BB'
   -- $1,313,000 class K 'BB-'
   -- $1,520,000 class L 'B+'
   -- $622,000 class M 'B'
   -- $2,384,000 class N 'B-'.

      *  Notional amount
      ** Interest only

The ratings reflect the credit enhancement provided to each class
by subordination of junior classes, the positive and negative
features of the underlying collateral, and the integrity of the
legal and financial structures, including advancing for liquidity
by the master servicer and the trustee of each underlying
commercial mortgage-backed securities -- CMBS -- transaction.  The
ratings do not address the likelihood or frequency of principal
prepayments or the receipt of prepayment premiums, default
interest, additional interest, or penalties.  The preliminary
ratings on the interest-only certificates address only the
likelihood of receiving interest payments, while principal on the
related certificates remains outstanding.

The certificates are directly or indirectly secured by a portfolio
consisting of all or a portion of 25 fixed-rate subordinated
classes from 13 CMBS transactions.  The largest underlying CMBS
transaction is Marquee 2004-1 Ltd., which is a repackaging of a
senior certificate, evidencing an ownership interest in the two
classes of CMCMT 1998-C1, representing 75.3% of COMM 2004-RS1.


CONCERT INDUSTRIES: Files CCAA Plan of Arrangement in Montreal
--------------------------------------------------------------
Concert Industries Ltd.'s (TSX: CNG) Canadian operating
subsidiaries have filed a motion to order a meeting of their
creditors to consider and vote on a final plan of compromise and
arrangement pursuant to the Companies' Creditors Arrangement Act.
The plan relates only to Concert Fabrication Ltee, Concert Airlaid
Ltee and Advanced Airlaid Technologies Inc., the Canadian
operating subsidiaries, and their creditors.

The motion will be presented in the Superior Court for the
District of Montreal today, Nov. 8, 2004.  The motion, if granted,
will order that Concert's Canadian operating subsidiaries call and
hold a meeting on Dec. 10, 2004 and that during the interim
period, creditors will submit proof of their claims against the
companies.

If approved, the Canadian operating subsidiaries' plan would
entail a significant restructuring of Concert's Canadian
operations.  The Company's European operations will be unaffected
by the plan.  The plan is part of a comprehensive reorganization
of the business and affairs of Concert's Canadian operating
companies and is designed to enable them to be restructured and
repositioned on a long-term basis as a viable business in the
development and manufacture of specialty pulp based absorbent
latex, thermal and multi-bonded airlaid fabrics.  The Canadian
operating companies have developed the plan, which they believe is
in the best interest of all stakeholders including creditors,
suppliers and employees.  These companies have been involved in
ongoing discussions with Tricap Management Limited, their senior
secured lender, concerning the plan and the restructuring of their
operations and Tricap supports the terms of the plan.  Certain
other major creditors that are affected by the plan have agreed to
vote in favour of and support the plan.

Shareholders and creditors of Concert will not be entitled to vote
on, or participate in, the plan of the Canadian operating
subsidiaries.  Following the implementation of the plan, Concert
will no longer have ownership or control of any of its operating
companies.  The implementation of the plan is likely to result in
the delisting of Concert's shares from the TSX.

The entire text of the motion and the plan of arrangement will be
made available, starting November 9, through the Company's website
at http://www.concert.ca/through the website of the Monitor,  
PricewaterhouseCoopers Inc., at http://www.pwc.com/brs-
concertgroup/ or by calling Marc Nantel-Legault of the Monitor at
(514) 205-5088.

                        About the Company

Concert Industries Ltd. is a company specializing in the
manufacture of cellulose fiber based non-woven fabrics using
airlaid manufacturing technology.  Concert's products have
superior absorbency capability and are key components in a wide
range of personal care consumer products, including feminine
hygiene and adult incontinence products.  Other applications
include pre-moistened baby wipes, disposable medical and
filtration applications and tabletop products.  The Company has
manufacturing facilities in Canada, in Gatineau and Thurso,
Quebec, and in Germany, in Falkenhagen, Brandenburg.

On August 5, 2003, the Company and certain of its North American
subsidiaries obtained an order from the Quebec Superior Court of
Justice providing creditor protection under CCAA Proceedings.  The
Company's European operations are excluded from the CCAA
Proceedings.  PricewaterhouseCoopers Inc., was appointed by the
Court to act as the Monitor, and this order is currently in effect
until December 17, 2004.  The entire text of the Court orders and
the Monitor's reports are available at http://www.concert.ca/and  
at http://www.pwc.com/brs-concertgroup/or by calling  
(613) 755-5981.


CONMED CORP: S&P Assigns B Rating to $125 Mil. Convertible Notes
----------------------------------------------------------------
Standard & Poor's Ratings Services assigned its 'B' subordinated
debt rating to medical products maker ConMed Corp.'s 20-year,
$125 million convertible note offering.  At the same time,
Standard & Poor's affirmed its 'BB-' corporate credit and senior
secured debt ratings on the company.

The proceeds of the convertible note transaction will be used to
refinance part of ConMed's senior secured credit facility and to
complete a $30 million stock repurchase.  After the transaction,
ConMed will have approximately $320 million of debt outstanding.  
The outlook is stable.

"The ratings on ConMed Corp. reflect Standard & Poor's concern
that the midsize medical products manufacturer, though well-
established in a number of surgical markets, faces the ongoing
challenge of competing against larger, better-financed companies
in each of its markets," said Standard & Poor's credit analyst
Jordan C. Grant.

Utica, New York-based ConMed is trying to capitalize on its
position as an important manufacturer of arthroscopic and powered
surgical instruments and electrosurgical systems.  By focusing on
niche areas within operating room services and establishing
relationships with physicians through a sizable sales force, the
company has garnered the second-largest U.S. market share in four
of its five product lines.  ConMed has pursued moderate-sized
acquisitions to expand its niche offerings.  Most recently, it
acquired selected endoscopy equipment lines from C.R. Bard
(BBB+/Stable/A-2) for $84 million in August 2004, and in 2003, it
acquired Bionx Implants Inc., a manufacturer of soft-tissue and
fracture-repair products, for approximately $48 million.  Still,
ConMed competes with much larger companies that have broader
offerings, including Johnson & Johnson (AAA/Stable/A-1+) and
Stryker Corp. (A-/Stable/--).

Disappointments with new products--at the same time the company is
making investments to expand its sales force--have contributed to
a decline in operating margins.  These margins peaked at 28% a few
years ago, then fell to 24%, where they have remained fairly
consistent.  Still, ConMed's financial profile remains appropriate
for the rating, despite the company's recent acquisition and its
expected share repurchase activity.


CROWN CASTLE: Buys Verizon's Interest in Crown Atlantic for $295MM
------------------------------------------------------------------
Crown Castle International Corp. (NYSE: CCI) has purchased
Verizon's 37.245% interest in the Crown Atlantic Joint Venture for
$295 million, inclusive of approximately $15 million of net
working capital.  Effective immediately, Crown Castle owns 100% of
Crown Atlantic.  Verizon will retain certain protective rights
regarding the tower network held by Crown Atlantic.

For the quarter ended September 30, 2004, Crown Atlantic generated
$114.0 million in annualized site rental revenue and $70.4 million
in annualized Adjusted EBITDA.  Crown Atlantic owns 2,019 towers
and has $180 million outstanding under its senior credit facility.

Also, Crown Castle Operating Company, a restricted group
subsidiary as defined in Crown Castle's bond indentures, has
purchased a 15% interest in Crown Atlantic for $118.8 million in
cash from Crown Castle Investment Corp., an unrestricted
subsidiary as defined in Crown Castle's bond indentures. After
giving effect to this purchase, CCOC owns approximately 52% of
Crown Atlantic and CC Investment owns approximately 48% of Crown
Atlantic.  As a result of the transactions, Crown Castle has
designated Crown Atlantic a restricted group subsidiary.

As of September 30, 2004, pro forma for these transactions, Crown
Castle had $613.5 million of cash and cash equivalents, including
approximately $154 million in its unrestricted subsidiaries.
Additional details regarding these transactions will be available
in Crown Castle's Form 8-K to be filed on or before November 10,
2004.

Crown Castle International Corp. engineers, deploys, owns and
operates technologically advanced shared wireless infrastructure,
including extensive networks of towers.  Crown Castle offers
significant wireless communications coverage to 68 of the top 100
United States markets and to substantially all of the Australian
population.  Crown Castle owns, operates and manages over 10,600
and over 1,300 wireless communication sites in the U.S. and
Australia, respectively. For more information on Crown Castle
visit: http://www.crowncastle.com/

                          *     *     *

As reported in the Troubled Company Reporter on June 30,2004,
Standard & Poor's Ratings Services placed its ratings of Houston,
Texas-based wireless tower operator Crown Castle International
Corp. (including the 'B-' corporate credit rating) and operating
company Crown Castle Operating Co. on CreditWatch with positive
implications.  Approximately $4 billion of leased-adjusted debt is
outstanding.

The CreditWatch placement follows Crown Castle's announcement of a
definitive agreement to sell its U.K. tower subsidiary for about
$2 billion.  The prior positive outlook had recognized the
potential for meaningful reduction in debt leverage, and the
earmarking of $1.3 billion of proceeds from the announced
disposition could accelerate the deleveraging process.  However, a
key factor in the rating analysis will be the use of the
approximate $740 million balance of net sale proceeds. The
company notes that these monies will be used either for further
debt reduction or for expansion of its U.S. portfolio.  To the
extent that Crown Castle opts not to apply the bulk of the
$740 million to debt reduction, Standard & Poor's will review
management's expansion plans, including the potential cash flow
from newly built and/or purchased towers.  "If Crown Castle
purchases extant towers, factors that will be considered in
evaluating the credit impact will include the quality of existing
tenants per tower, contract terms applicable to purchased tenants,
the potential for new tenants, and tenant diversity," said
Standard & Poor's credit analyst Michael Tsao.


DANKA BUSINESS: Sept. 30 Balance Sheet Upside-Down by $73.9 Mil.
----------------------------------------------------------------
Danka Business Systems PLC (NASDAQ: DANKY) reported second-quarter
results for the period ended September 30, 2004 that include
operating earnings of $6.0 million, an increase over the
$1 million from the second quarter a year ago and a 10% year-over-
year decrease in selling, general and administrative expenses.
Total revenue was $308.7 million, a decline of 4% from the second
quarter a year ago.  Gross margins were 36.3%, cash flow from
operations was $27.6 million and free cash flow was $21.9 million.
Net loss was $1.8 million for the quarter compared to a net loss
of $17.3 million in the year-ago quarter.  The year-ago quarter
included $20.6 million of pre-tax expense for the write-off of
debt issuance costs.  Including the impact of dividends on
participating shares, basic and diluted EPS was a loss of $0.11
per share compared to a loss of $0.35 per share in the year-ago
period.

"Our overall performance in the second quarter was highlighted by
the year-over-year improvement in operating earnings," stated
Danka Chief Executive Officer Todd Mavis.  "SG&A was also down
approximately $12 million over the year-ago quarter which further
demonstrates that we are delivering on promised cost savings, even
as we make growth-oriented investments in our product offerings,
our sales force and our infrastructure.  Our efforts remain
focused on the creation of value across the enterprise and the
second quarter results were validation that we are on the right
track."

"In the quarter, we successfully executed on key initiatives to
increase equipment sales and cash generation over last quarter,"
continued Mavis.  "Equipment and related revenue increased 15%
sequentially and free cash flow was $21.9 million.  As expected,
we did see a sequential decline in service revenue largely due to
the seasonality of our business."

Key second-quarter financial metrics:

   -- Total second-quarter revenue was $308.7 million, a 4%
      decline from the year-ago quarter but essentially flat with
      the first quarter. Adjusting for currency exchange, total
      revenue declined 8% year-over-year.  Most of the decline was
      attributable to service revenue which declined by 6% year-
      over-year.  The retail supplies and rentals business also
      declined, as expected, because of the de-emphasis of
      rentals, as well as the declining need for supplies related
      to the heritage Kodak analog equipment base.

   -- The digital portion of Danka's equipment base increased to
      60% and digital output now represents 75% of total volume,
      both of which are key elements in the stabilization and
      ultimate growth of service revenues.

   -- Consolidated gross margins were 36.3% of revenue compared to
      37.2% in the same quarter last year.  The primary reason for
      the decline was a 250 basis point decrease in equipment and
      related sales margins. Service margins were stable at 40.5%.

   -- SG&A was $107.6 million, 10% lower than the year-ago
      quarter, and 3% lower than the first quarter. As a
      percentage of revenue, SG&A was 34.9% in the second quarter,
      200 basis points lower than the year-ago period, and 100
      basis points lower than the first quarter.

   -- Operating earnings were $6.0 million compared to $1.0
      million in the year-ago second quarter.  Operating earnings
      were favorably impacted this quarter by the net reversal of
      $2.1 million of restructuring reserves and the approximate
      $1 million reversal of an accrual related to a historic
      asset disposition.  Operating earnings were negatively
      impacted in the quarter by higher than expected costs in
      Danka's Sarbanes-Oxley compliance program and consulting
      fees related to cost reduction efforts.

   -- Free cash flow (net cash provided by operating activities
      less capital expenditures) was $21.9 million compared to
      negative free cash flow of $28.1 million in the first
      quarter.  As a result, the company's cash balance at the end
      of the second quarter was $106.6 million compared to $85.9
      million at the end of the first quarter.

   -- Total revenue for the six months ended September 30, 2004
      was $619.0 million compared to $656.7 million in the year-
      ago period. Gross margins were 37.3% for the period compared
      to 37.0% in the year-ago period.  Operating earnings were
      $13.9 million compared to $6.0 million, an increase of 132%.
      Cash flow from operations was $3.9 million compared to $44.0
      million in the year-ago period.

"During the second quarter, we increased the size of our U.S.
sales force to improve our sales coverage, added new technology
offerings to our product portfolio and continued to leverage our
recent IT investments to improve back office processes, all of
which will lead to improved execution, new revenue opportunities
and the rightsizing of our cost structure," concluded Mavis.
"Moving forward, we will further expand sales coverage, accelerate
our TechSource business and bring additional product offerings to
market.  We are also progressing a multi-faceted reengineering of
our business that we believe will generate important new cost
reductions and operational efficiencies.  We believe these actions
will provide long term benefit to our customers, provide a
platform for growth and create value across all aspects of our
business."

                        About the Company

Danka delivers value to clients worldwide by using its expert
technical and professional services to implement effective
document information solutions.  As one of the largest independent
providers of enterprise imaging systems and services, the company
enables choice, convenience, and continuity.  Danka's vision is to
empower customers to benefit fully from the convergence of image
and document technologies in a connected environment.  This
approach will strengthen the company's client relationships and
expand its strategic value.  For more information, visit Danka at
http://www.danka.com/

At Sept. 30, 2004, Danka's balance sheet showed a $73,895,000
stockholders' deficit, compared to a $64,755,000 deficit at
March 31, 2004.


DELTA AIR: $252 Million of Pass Through Certificates Tendered
-------------------------------------------------------------
Delta Air Lines (NYSE: DAL) reported that approximately
$252 million aggregate principal amount of Pass Through
Certificates Series 2000-1C and Pass Through Certificates Series
2001-1C have been tendered in its pending exchange offer.

Consummation of the exchange offer remains subject to numerous
other significant conditions.  The amount of securities in the
other classes tendered to date is substantially below the minimum
tender conditions.  In the event that the exchange offer is
consummated only with respect to the Short-Term Existing
Securities then the collateral reserved for the other classes of
notes will be available to Delta to meet other liquidity needs.

As reported in the Troubled Company Reporter on Oct. 18, 2004,
Delta Air Lines was amending and extending its offer to exchange
up to $680 million aggregate principal amount of three series of
newly issued senior secured notes to the holders of $2.6 billion
aggregate principal amount of outstanding unsecured debt
securities and enhanced pass through certificates.

The New Notes will be secured by a pool of collateral consisting
of certain unencumbered aircraft, flight simulators and flight
training equipment with an aggregate appraised current market
value of $1.2 billion.  If only the A-1 New Notes are issued, they
will be secured by a pool of unencumbered aircraft with an
aggregate appraised current market value of $0.4 billion.  The A-1
New Notes will amortize from 2006 through 2008, the A-2 New Notes
will amortize from 2009 through 2011 and the A-3 New Notes will
amortize from 2012 through 2014.  The New Notes will accrue
interest from the settlement date at an annual rate of 9.5% in the
case of the A-1 New Notes, 10% in the case of the A-2 New Notes
and 12% in the case of the A-3 New Notes.

The exchange offer will terminate at 5:00 p.m. on Nov. 18, 2004,
unless extended.

The offering is being made only to "qualified institutional
buyers," as such term is defined in Rule 144A under the Securities
Act of 1933, as amended.

The exchange offer will not be registered under the Securities Act
of 1933, or any state securities laws.  Therefore, any securities
issued in the exchange offer may not be offered or sold in the
United States absent an exemption from the registration
requirements of the Securities Act of 1933 and any applicable
state securities laws.  This announcement is neither an offer to
sell nor a solicitation of an offer to buy the securities offered
in the exchange offer.

                        About the Company

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


DELTA FUNDING: Fitch Junks Class B & Cuts Class M-2's Rating to B
-----------------------------------------------------------------
Fitch Ratings has taken rating action on these Delta Funding
Corporation issue:

   * Series 2000-4

     -- Class A affirmed at 'AAA';
     -- Class M-1 affirmed at 'AA';
     -- Class M-2 downgraded to 'B' from 'BB';
     -- Class B remains at 'C'.

The affirmations (representing approximately $17.40 million in
outstanding principal) reflect credit enhancement consistent with
future losses.

In addition, the affirmed class A reflects a certificate insurance
policy provided by Financial Security Assurance Inc. -- FSA, whose
insurer financial strength is rated 'AAA' by Fitch.

The negative rating action (representing approximately
$5.5 million in outstanding principal) have been taken due to
higher losses than expected.  As of October 15, 2004, there is no
overcollateralization remaining in the current pool, with 39.99%
of the current principal balance 60 or more days delinquent.

Fitch will continue to closely monitor this deal.

Further information regarding current delinquency, loss, and
credit enhancement statistics is available on the Fitch Ratings
web site at http://www.fitchratings.com/


DIAMOND K CORP.: Case Summary & 22 Largest Unsecured Creditors
--------------------------------------------------------------
Lead Debtor: Diamond K Corporation
             2305 County Road 3210
             Mount Pleasant, Texas 75455

Bankruptcy Case No.: 04-62341

Debtor affiliates filing separate chapter 11 petitions:

      Entity                                     Case No.
      ------                                     --------
      R&K Energy, Inc.                           04-62343

Type of Business: The Debtor is a construction company and
                  currently engaged in approximately thirty-five
                  construction projects in various degrees of
                  completion throughout the United States.
                  See http://www.diamondkcorp.com/

Chapter 11 Petition Date: November 4, 2004

Court: Eastern District of Texas (Tyler)

Debtors' Counsel: Amanda Inabnett Hughes, Esq.
                  Mark A. Castillo, Esq.
                  The Curtis Law Firm
                  901 Main Street, Suite 6515
                  Dallas, TX 75202
                  Tel: 214-752-2222
                  Fax: 214-752-0709

                             Estimated Assets    Estimated Debts
                             ----------------    ---------------
Diamond K Corporation           $1 M to $10 M      $1 M to $10 M
R&K Energy, Inc.            $100,000-$500,000   $500,000 to $1 M

A. Diamond K Corporation's 20 Largest Unsecured Creditors:

Entity                                 Claim Amount
------                                 ------------
Clear Stream Environment                   $148,050
P.O. Box 73552
Houston, TX 77273

Lone Star Drilling, LLC                    $146,499
P.O. Box 69
Pittsburg, TX 75686

Hertz Equipment Rental                     $128,655
P.O. Box 26390
Oklahoma City, OK 73126

Boley Featherston Huffma                   $113,279

APAC Texas, Inc.                           $101,045

NQL Energy Service                         $100,050

Stephenson Dirt LLC                         $79,005

United Rental FL                            $72,283

Striping Tech-Electrical                    $65,337

Cherokee Mechanica Inc.                     $55,662

Service Lloyd's                             $50,830

Dawn Development Co., Inc.                  $50,534

Underground Utility Supp.                   $44,872

Sharewell, LP                               $37,157

Holland Pump                                $36,479

Transit Mix Concrete                        $34,863

Carruth Nursery                             $33,436

Fleet Fueling                               $31,919

Drillers Supply, Inc.                       $30,646

Sunwest Mud                                 $26,809

B. R&K Energy, Inc.'s 2 Largest Unsecured Creditors:

Entity                                 Claim Amount
------                                 ------------
Diamond K Corporation                       Unknown

The CIT Group/EF                            Unknown


DIGITALNET: Moody's Withdraws Low-B Ratings After BAE Acquisition
-----------------------------------------------------------------
Moody's Investors Service confirmed and will withdraw the ratings
of DigitalNet, Inc., following the completion of the acquisition
of the company's parent, DigitalNet Holdings, Inc., by BAE Systems
North America, Inc., a subsidiary of BAE Systems plc (senior debt
at Baa2).  All but a small amount (under $1 million) of the senior
unsecured notes of DigitalNet, Inc. were retired in a tender offer
concurrently with the closing of the acquisition.  The ratings
confirmation concludes the review of the company's ratings that
was announced on September 14, 2004.

Moody's has confirmed and will withdraw these ratings:

   * $81.3 million Senior Unsecured Notes due 2010, rated B2;
   * Senior Implied, rated B1;
   * Senior Unsecured Issuer, rated B2.

Headquartered in Herndon, Virginia, DigitalNet, Inc., now a
subsidiary of BAE Systems North America, Inc., is a leading
provider of managed network, information security, and application
development and integration services and solutions to U.S.
civilian, defense, and intelligence federal government agencies.


DIVERSIFIED ASSET: Fitch Slices Class B-1 Notes' Rating to B
------------------------------------------------------------
Fitch Ratings downgraded two classes of notes and affirms two
classes of notes issued by Diversified Asset Securitization
Holdings II, L.P. -- DASH II.  These rating actions are effective
immediately:

   -- $50,229,828 class A-1 notes affirmed at 'AAA';
   -- $318,122,241 class A-1L notes affirmed at 'AAA';
   -- $50,000,000 class A-2L notes downgraded to 'BBB+' from 'A-';
   -- $37,000,000 class B-1 notes downgraded to 'B' from 'BB-'.

Furthermore, the class A-2L and class B-1 notes are removed from
Rating Watch Negative.

DASH II is a structured finance collateralized debt obligation
managed by Western Asset Management Co. and originated by Asset
Allocation & Management, LLC -- AAMCO.  Western became the
substitute asset manager for AAMCO in October 2002.  Fitch rates
Western 'CAM2' on its ABS asset manager rating.

DASH II was established in Sept. 13, 2000 to issue $496 million in
notes and limited partnership interests.  The portfolio supporting
the CDO comprises approximately 37% residential mortgage-backed
securities -- RMBS, 29% commercial mortgage-backed securities --
CMBS, 23% commercial asset-backed securities -- ABS, and 8%
consumer ABS.  Included in this review, Fitch discussed the
current state of the portfolio with the asset manager and their
portfolio management strategy.  In addition, Fitch conducted cash
flow modeling utilizing various default timing and interest rate
scenarios to measure the breakeven default rates relative to the
minimum cumulative default rates required for the rated
liabilities.  As a result of this analysis, Fitch has determined
that the current ratings assigned to the class A-2L and B-1 notes
no longer reflect the current risk to noteholders.

Since the last rating action, the collateral has continued to
deteriorate.  The weighted average rating factor has increased
from 23 ('BBB-') to 27 ('BBB-/BB+').  The class A
overcollateralization ratio decreased to 111.6% as of the most
recent trustee report dated October 2, 2004, from 113.70% as of
September 30, 2003, the class B OC ratio has decreased to 102.1%
from 104.4% and now fails versus the trigger of 103%.  Defaulted
assets have increased from 0.65% as of September 30, 2003 to 5.39%
of the total collateral and eligible investments.  Assets rated
'BBB-' or lower represented approximately 24.97%, excluding
defaults.

The rating of the class A-1 and class A-1L notes addresses the
likelihood that investors will receive full and timely payments of
interest, as per the governing documents, as well as the stated
balance of principal by the legal final maturity date.  The
ratings of the class A-2L and class B-1 notes address the
likelihood that investors will receive ultimate and compensating
interest payments, as per the governing documents, as well as the
stated balance of principal by the legal final maturity date.

Fitch will continue to monitor and review this transaction for
future rating adjustments.  Additional deal information and
historical data are available on the Fitch web site at
http://www.fitchratings.com For more information on the Fitch  
VECTOR model, see 'Global Rating Criteria for Collateralised Debt
Obligations,' dated Sept. 13, 2004, available on Fitch's web site.


DT INDUSTRIES: Wants Plan-Filing Period Stretched to March 8
------------------------------------------------------------
DT Industries, Inc., and its debtor-affiliates ask the Honorable
Lawrence S. Walter of the U.S. Bankruptcy Court for the Southern
District of Ohio, Western Division, for more time to file a
chapter 11 plan.  Specifically, the Debtors ask the Court to
extend their exclusive period in which to file a plan through
March 8, 2005, and ask for a concomitant extension of their time
to solicit acceptances of that plan through May 7, 2005.

DT Industries sold substantially a large chunk of its assets to
Thompson Street Capital Partners for $18 million earlier this
year.  The company is currently trying to complete a sale of its
U.K. assets.  

Headquartered in Dayton, Ohio, DT Industries, Inc.
-- http://www.dtindustries.com/-- is an engineering-driven
designer, manufacturer and integrator of automated systems and
related equipment used to manufacture, assemble, test or package
industrial and consumer products. The Company and its
debtor-affiliates, filed for chapter 11 protection on May 12, 2004
(Bankr. S.D. Ohio Case No. 04-34091). Ronald S. Pretekin, Esq.,
at Coolidge Wall Womsley & Lombard, represents the Debtors in
their restructuring efforts. When the Debtors filed for protection
from their creditors, they listed $150,593,000 in assets and
$142,913,000 in liabilities.


DYNACQ HEALTHCARE: Restructures Bank Loan & Cures Default
---------------------------------------------------------
Dynacq Healthcare Inc. (Pink Sheets:DYII) has completed a
restructuring of its $6 million revolving credit facility which
will now mature on Feb. 28, 2005. Currently, approximately
$5.8 million is outstanding under the revolving credit facility.

As a result of the restructuring, Dynacq is no longer in default
under this facility. Dynacq intends to either refinance the
amounts due or repay all outstanding amounts by such final
maturity date.

                        About the Company

Dynacq Healthcare Inc. -- http://www.dynacq.com/-- is a holding  
company. Its subsidiaries provide surgical healthcare services and
related ancillary services through hospital facilities and
outpatient surgical centers.

                          *     *     *

                        Bank Debt Default

DYNACQ INTERNATIONAL, INC., is the borrower under an $8,000,000
WORKING CAPITAL MANAGEMENT(R) ACCOUNT AGREEMENT NO. 582-07L53
with MERRILL LYNCH, PIERCE, FENNER & SMITH INCORPORATED dated as
of May 18, 2001.  

In its Form 10-Q for the quarterly period ended May 31, 2004,
filed with the Securities and Exchange Commission, Dynacq
Healthcare, Inc., reported:

"Because we did not timely file the Form 10-K for the fiscal year
ending August 31, 2003 and the three quarterly reports on Form
10-Q for the fiscal quarters ended November 30, 2003, February 29,
2004 and May 31, 2004, we are in default under the terms of the
line of credit. On April 16, 2004, the financial institution
submitted to us a written notice of default. Since we did not cure
the default within 10 days, we are now in default under the line
of credit. To this date, the financial institution has not taken
any further action. Our indebtedness under our line of credit is
secured by substantially all of our assets. If we are unable to
repay all outstanding balances, the financial institution could
proceed against our assets to satisfy our obligations under the
line of credit. There can be no assurance that the Company will
have sufficient funds available to meet all of its capital needs.


EMISPHERE TECH: Sept. 30 Stockholders' Deficit Narrows to $4.1-Mil
------------------------------------------------------------------
Emisphere Technologies, Inc. (Nasdaq: EMIS) reported results for
the third quarter ended September 30, 2004. The Company also
reviewed highlights of the quarter including progress in
commercializing its proprietary eligen(R) drug delivery
technology.

Emisphere reported a preliminary net loss of $9.5 million for the
quarter ended September 30, 2004, as compared to a net loss of
$14.3 million for the quarter ended September 30, 2003. The
foregoing net loss is preliminary and subject to an ongoing review
by the Company and its auditors of the accounting treatment, which
is non-cash in nature, of the Company's employee stock purchase
plans in the current and prior periods. That review is expected to
be completed before the filing of the Company's financial
statements for the quarter ended September 30, 2004 to be
submitted to the SEC on Form 10-Q.

Total operating expenses were $8.1 million for the 2004 third
quarter, a decrease of $5.8 million, or 42%, compared to the same
period last year. Total operating expenses include research and
development costs of $4.1 million, a decrease of $1.7 million or
29%, compared to last year's third quarter. General and
administrative expenses were $2.6 million, an increase of $0.3
million or 13% as compared to the same period last year, resulting
primarily from increased legal fees associated with ongoing
litigation with Eli Lilly and Company concerning parathyroid
hormone.

Net cash used in operations for the quarter was $5.8 million
compared to $6.1 million for the previous quarter. As of September
30, 2004, Emisphere held cash, cash equivalents and investments
totaling $24.3 million, compared to $43 million at December 31,
2003.

      Product Development Update for Third Quarter 2004

Human Growth Hormone

In September, Emisphere announced that it entered into a licensing
agreement with Novartis Pharma AG to develop an oral formulation
of recombinant human growth hormone (rhGH). Under the terms of the
milestone- based agreement, Novartis may pay Emisphere up to $34
million during the course of product development, and a royalty
increasing to double-digit rates based upon sales. Including the
initial payment, Emisphere could achieve milestone-based payments
of up to $6 million over the course of the next year.

The companies formed the agreement following successful completion
of pre-clinical feasibility studies for rhGH with Emisphere's
eligen(R) technology. Emisphere identified delivery agents that
can deliver therapeutically sufficient levels of rhGH to the blood
stream when administered orally. The lead carrier for rhGH has
completed extensive formulation and preclinical safety studies.

This collaboration marks the second between the two companies. In
2000 Emisphere and Novartis entered into a license agreement for
the development of oral salmon calcitonin for the treatment of
osteoporosis.

Oral Salmon Calcitonin

During the third quarter, in the Journal of Bone and Mineral
Research, Novartis published positive results of its 277-subject
Phase II-a study with oral salmon calcitonin. The results showed
effective absorption of the drug within the body, marked
inhibition of bone resorption with minimal alteration of formation
and reproducibility of responses over three months. The low
dropout rate achieved in the study indicated that the drug was
well-tolerated with no major safety concerns. A second publication
in this journal has been accepted for this product, supporting
Novartis' plans to initiate a second clinical development program
for an osteoarthritis indication to run parallel with the program
in osteoporosis.

Michael M. Goldberg, M.D., Chairman and Chief Executive Officer of
Emisphere Technologies, Inc., commented, "We continue to make
progress in our research and development efforts, both internally
and in collaboration with our partners. We have expanded our
relationship with Novartis through our licensing deal for human
growth hormone. The positive Phase II results Novartis has
published on oral salmon calcitonin indicate that this program
will serve as a strong foundation to help move the human growth
hormone program forward. This expansion of our relationship with
Novartis further demonstrates the performance of our eligen(R)
drug delivery technology."

                     The eligen(R) Technology

Emisphere's broad-based oral drug delivery technology platform,
known as the eligen(R) technology, is based on the use of
proprietary, synthetic chemical compounds, known as EMISPHERE(R)
delivery agents, or "carriers". These molecules facilitate or
enable the transport of the therapeutic macromolecules across
biological membranes such as those of the gastrointestinal tract,
and exert their desired pharmacological effect. Emisphere's
eligen(R) technology makes it possible to orally deliver a
therapeutic molecule without altering its chemical form or
biological integrity.

                        About the Company

Emisphere Technologies, Inc. (Nasdaq: EMIS) is a biopharmaceutical
company pioneering the oral delivery of otherwise injectable
drugs. Emisphere's business strategy is to develop oral forms of
injectable drugs, either alone or with corporate partners, by
applying its proprietary eligen(R) technology to those drugs or
licensing its eligen(R) technology to partners who typically apply
it directly to their marketed drugs. Emisphere's eligen(R)
technology has enabled the oral delivery of proteins, peptides,
macromolecules and charged organics. Emisphere and its partners
have advanced oral formulations or prototypes of salmon
calcitonin, heparin, insulin, parathyroid hormone, human growth
hormone and cromolyn sodium into clinical trials. Emisphere has
strategic alliances with world-leading pharmaceutical companies.
For further information, please visit http://www.emisphere.com/

At Sept. 30, 2004, Emisphere Technologies' balance sheet showed a
$4,105,000 stockholders' deficit, compared to a $22,807,000
deficit at Dec. 31, 2003.

The $4.1 million stockholders' deficit is preliminary and subject
to an ongoing review by the Company and its auditors of the non-
cash financial treatment of the Company's employee stock purchase
plan. That review is expected to be completed before the filing of
the Company's financial statements for the quarter ended Sept. 30,
2004 to be submitted to the SEC on Form 10-Q.


ENRON CORP: Court Approves Settlement Agreement with Accord Energy
------------------------------------------------------------------
Prior to filing its chapter 11 case, Enron Corp. issued a credit
support guaranty to Accord Energy Limited where Enron guaranteed
certain obligations of Enron Capital & Trade Resources Limited up
to $21,382,500.  On February 23, 2000, Enron and Accord amended
the Guaranty, increasing the guaranteed amount to $35,637,500.  On
December 20, 2000, Enron and Accord entered into a second
amendment to the Guaranty, adding Enron Canada Corp. and Enron
North America Corp. as obligors and to increase the amount of the
Guaranty to $106,912,500.

On October 15, 2002, Accord filed a $50,391,245 claim against
Enron asserting alleged obligations under the Guaranty.
On November 26, 2003, Enron filed an adversary proceeding seeking
to avoid the Second Amendment.

Edward A. Smith, Esq., at Cadwalader, Wickersham & Taft, in New
York, points out that the Compromise Election in the Debtors'
Fifth Amended Chapter 11 Plan allows holders of guaranty claims
for guarantees executed between December 2, 2000, and January 31,
2001, to compromise and settle litigation concerning the claims
at a 50% discount to the allowed amount of the claim.

Following discussions between Enron and Accord, the parties have
negotiated a settlement agreement.  The Settlement Agreement
provides that:

    (a) Accord will elect the Compromise Election -- a 50%
        discount will be applied with respect to the allowed
        amounts of the Claim in excess of $35,637,500, for
        purposes of determining Accord's distribution under the
        Plan;

    (b) Neither the Guaranty nor the First Amendment is subject to
        avoidance under Section 548 of the Bankruptcy Code;

    (c) Nothing in the Settlement Agreement will preclude, limit,
        or restrict the Debtors' right to object to, contest, or
        litigate the amount of the Claim, provided that Enron
        agrees not to raise or assert any defense to the Claim
        that may be available to it pursuant to Sections 544, 547
        and 548 of the Bankruptcy Code; and

    (d) Enron will file with the Court a stipulation dismissing
        the Guaranty Avoidance Action, with prejudice and without
        costs to any party.

The Settlement Agreement will clearly benefit the Debtor and its
creditors, Mr. Smith asserts.  The Settlement Agreement allows
the Debtor to avoid further litigation concerning the Guaranty,
including the attendant litigation costs, and results in the
reduction in the allowed amount of the Claim.

Accordingly, Enron sought and obtained the Court's approval of
the Settlement Agreement.

Headquartered in Houston, Texas, Enron Corporation is in the midst
of restructuring various businesses for distribution as ongoing
companies to its creditors and liquidating its remaining
operations.  Before the company agreed to be acquired, controversy
over accounting procedures had caused Enron's stock price and
credit rating to drop sharply.  The Company filed for chapter 11
protection on December 2, 2001 (Bankr. S.D.N.Y. Case No. 01-
16033).  Judge Gonzalez confirmed the Company's Modified Fifth
Amended Plan on July 15, 2004, and numerous appeals followed.  
Martin J. Bienenstock, Esq., and Brian S. Rosen, Esq., at Weil,
Gotshal & Manges, LLP, represent the Debtors in their
restructuring efforts. (Enron Bankruptcy News, Issue No. 128;
Bankruptcy Creditors' Service, Inc., 15/945-7000)


ENRON CORP: Court Allows $6.75 Million Claim Against NEGT Power
---------------------------------------------------------------
Enron Corporation and its debtor-affiliates ask the Court to
approve their Stipulation of Settlement with NEGT Energy Trading -
Gas Corporation formerly known as PG&E Energy Trading - Power, LP,
and NEGT Energy Trading - Power, LP.

According to Edward A. Smith, Esq., at Cadwalader, Wickersham &
Taft, in New York, the NEGT Entities filed for Chapter 11
protection on July 8, 2003, in the United States Bankruptcy Court
for the District of Maryland.

Debtors Enron Power Marketing, Inc., Enron Energy Marketing
Corp., and Enron Energy Services, Inc., and the NEGT Entities
were parties to prepetition contracts for the sale of power and a
Termination and Transaction Agreement dated November 30, 2001.

On November 26, 2003, EPMI filed in the Maryland Bankruptcy Court
a complaint to avoid and recover preferential transfers against
PG&E Power.  EPMI also filed Claim No. 62 for $13,200,000 against
NEGT Power.  On January 9, 2004, EPMI filed Claim No. 224 for
$13,200,00, intending to amend and supersede Claim No. 62.
Additionally, the Debtors filed three claims against the NEGT
Entities:

    Debtor Claimant      Claim No.                  Claim Amount
    ---------------      ---------                  ------------
    EEMC                    372                       $2,436,240
    EESI                    373                          730,436
    ENA                     197        contingent & unliquidated

NEGT Power objected to Claim Nos. 372, 373, and 197.

To resolve their disputes, the Parties entered into a Settlement
Agreement, which provides that:

    (a) Claim No. 224 will be allowed for $6,750,000, as a
        general unsecured claim against NEGT Power, which
        claim and distribution will not be subject to any rights
        of setoff or recoupment;

    (b) Claim Nos. 62, 373 and 373 will be expunged and disallowed
        in their entirety;

    (c) The objection to Claim No. 197 will be deemed withdrawn
        without prejudice; and

    (d) The Maryland Action will be dismissed with prejudice.

The Settlement will clearly benefit the Debtors and their
creditors, Mr. Smith states.  The Debtors believe that the $6.75
million claim allowance will adequately compensate them for their
Contracts with NEGT Power.

The Court promptly approves the Settlement.

Headquartered in Houston, Texas, Enron Corporation is in the midst
of restructuring various businesses for distribution as ongoing
companies to its creditors and liquidating its remaining
operations.  Before the company agreed to be acquired, controversy
over accounting procedures had caused Enron's stock price and
credit rating to drop sharply.  The Company filed for chapter 11
protection on December 2, 2001 (Bankr. S.D.N.Y. Case No. 01-
16033).  Judge Gonzalez confirmed the Company's Modified Fifth
Amended Plan on July 15, 2004, and numerous appeals followed.  
Martin J. Bienenstock, Esq., and Brian S. Rosen, Esq., at Weil,
Gotshal & Manges, LLP, represent the Debtors in their
restructuring efforts. (Enron Bankruptcy News, Issue No. 128;
Bankruptcy Creditors' Service, Inc., 15/945-7000)


ENRON CORP: AEP Completes $115 Million Bammel Asset Purchase
------------------------------------------------------------
American Electric Power (NYSE: AEP) closed its acquisition of the
Bammel storage reservoir and related pipeline and compressor
assets from Enron Corp. for $115 million.

AEP and Enron announced a settlement agreement in April related to
AEP's 30-year pre-paid lease arrangement for Bammel that was
entered into in June 2001 when AEP purchased Houston Pipe Line Co.
from Enron. Enron filed bankruptcy six months later and the lease
became part of the bankruptcy proceedings. The settlement
agreement was approved by bankruptcy court in September.

In this transaction, AEP acquires - among other assets - all of
Enron's interests in the 7,000-acre underground Bammel storage
reservoir near Houston, the related Bammel Loop, Texas Loop and
Houston City Loop pipelines, appurtenant wells, compressors and
other equipment, and 10.5 billion cubic feet (bcf) of natural gas
in the Bammel storage reservoir. AEP and Enron mutually released
the other from all claims associated with Bammel and the related
assets. The parties' respective trading claims are not covered
under this settlement.

Houston Pipe Line includes approximately 4,000 miles of natural
gas intrastate and gathering pipelines.

The settlement does not cover AEP's suit in Texas federal court
against Bank of America claiming fraud, breaches of contractual
covenants and negligent misrepresentations by Bank of America in
connection with AEP's purchase of the Houston Pipe Line stock, the
Bammel storage lease and related contractual agreements. Bank of
America claims a security interest in approximately 55 bcf of
cushion gas purportedly in the Bammel storage reservoir.

American Electric Power owns more than 36,000 megawatts of
generating capacity in the United States and is the nation's
largest electricity generator. AEP is also one of the largest
electric utilities in the United States, with more than 5 million
customers linked to AEP's 11-state electricity transmission and
distribution grid. The company is based in Columbus, Ohio.

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


FAO, INC.: Who Recovers What Under the Liquidating Plan
-------------------------------------------------------
As previously reported in the Troubled Company Reporter on Nov. 1,
2004, the Honorable Joel B. Rosenthal of the U.S. Bankruptcy Court
for the District of Delaware confirmed the Chapter 11 Plan of
Liquidation proposed by proposed by FAO, Inc., and its debtor-
affiliates.

Judge Rosenthal determined that the Plan:

   * properly classifies the claims,

   * specifies the unimpaired classes of claims,

   * specifies the treatment of unimpaired classes of claims,

   * provides for the same treatment of each claim in each class,

   * provides adequate and proper means for its implementation,

   * is not inconsistent with applicable provisions of the
     Bankruptcy Code,

   * complies with applicable provisions of the Bankruptcy Code,

   * was proposed in good-faith,

   * provides for the payment for services or costs and expenses
     in connection with the Debtors Chapter 11 cases,

   * provides for the proper treatment of administrative and tax
     claims pursuant to the requirements of Section 1129((a)(9) of
     the Bankruptcy Code,

   * is feasible,

   * calls for the payment of fees payable under Section 1930 of
     the Judiciary Procedures Code,

   * does not alter retiree benefits

   * is fair and equitable, and

   * does not call for the avoidance of taxes or the application
     of Section 5 of the Securities Act of 1933.
   
Each impaired class voted to accept the Plan.  A last-minute deal
with D.E. Shaw Laminar Portfolios LLC, reported in the Troubled
Company Reporter on Oct. 22, 2004, paved the way for a consensual
confirmation hearing.

                       Terms of the Plan

The Plan calls for the dissolution of the Debtors.  The Plan
contemplates the appointment of a Liquidation Trust Committee and
a Liquidation Trustee.  The Official Committee of Unsecured
Creditors will appoint a three- to five-member Liquidation Trust
Committee.  The Liquidation Trustee will be tasked to distribute
claims payment in consultation with the Liquidation Trust
Committee.

The Debtors will be substantively consolidated into a single
entity.  All intercompany claims and prepetition cross-corporate
guarantees between the Debtors will be eliminated.  All of the
Debtors' assets and liabilities will be merged.

Seven Classes of Claims will be paid in full:

   (1) Non-Professional Administrative Expense Claims totaling
       $400,000;
   
   (2) Professional Administrative Expense Claims totaling
       $850,000;
   
   (3) Priority Tax Claims totaling $950,000;

   (4) Priority Non-Tax Claims totaling $50,000;

   (5) Secured Claims of Banks and other Financial Institutions
       under the Prepetition Credit Agreement for $533,000;

   (6) D.E. Shaw Laminar Portfolios LLC's Claim under the
       Subordinated Note Due 2008 dated April 23, 2003, in the
       outstanding principal amount of $5,900,000 plus accrued
       interest;

   (7) Reclamation Claims totaling $1,040,547;

Other claims will be paid by the Liquidating Trust, with projected
recoveries based on the Trust's success in prosecuting and
recovering on avoidance actions:

    (A) D.E. Shaw Laminar Portfolios LLC will recover 28.5% to 50%
        of its claim based on the Equipment Note dated April 23,
        2003 in the principal amount of $3,853,154.

    (B) PNC Leasing LLC will get 50% to 85% of its secured
        claim based on the Loan Agreement dated September 5, 2001.  
        The Debtors owe PNC $453,164.

    (C) Vendors, Suppliers and Trade Creditors will recover
        47.3% to 60.9% of their claims.  The Debtors owe them
        $24,600,000.

    (D) Holders of Claims based on the prior Chapter 11 Plan
        confirmed in the Debtors' first Chapter 11 cases on
        April 4, 2003 will recover 28.3% to 39.4% of their claims.  
        Prior Plan Claims total $15,715,200.

    (E) Holders of General Unsecured Claims will recover 28.3% to
        39.4% of their claims.  General Unsecured Claims total
        $26,647,900.

Equity interests will be cancelled.

A full-text copy of the Plan is available for a fee at:

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

FAO Inc. (n/k/a Children's Books & Toys, Inc.) and its wholly
owned subsidiaries ZB Company, Inc., FAO Schwarz, Inc. (n/k/a Toy
Soldier, Inc.), The Right Start, Inc. (n/k/a TRS Liquidation Co.),
and Targoff-RS, LLC, filed for chapter 11 protection a second time
on December 4, 2003 (Bankr. D. Del. Case No. 03-13672), eight
months after they emerged from their first chapter 11 cases
(Bankr. D. Del. Case Nos. 03-10119 through 03-10122).  Mark D.
Collins, Esq., at Richards Layton & Finger, represents the
Debtors.  When the failed toy retailer filed for bankruptcy, it
listed $102,079,000 in assets and $85,898,000 in liabilities.


FOSTER WHEELER: Saybrook Completes Out-of-Court Restructuring
-------------------------------------------------------------
Saybrook successfully completed Foster Wheeler Ltd.'s equity-for-
debt exchange offer.  Foster Wheeler is a global company providing
a broad range of engineering and construction services to clients
in the refining, upstream oil and gas, chemicals, power
generation, pharmaceuticals and other sectors.  Saybrook was
engaged as financial advisor by the Ad Hoc Committee of Security
Holders of Foster Wheeler.

Many on Wall Street said this out-of-court restructuring of six
classes of securities couldn't be done.  Each with competing
interests, some held institutionally, others held in retail.  The
transaction involved the exchange of approximately $600 million of
debt and resulted in the reduction of the Company's total debt by
more than $450 million.  The exchange offer received over 93%
participation by the Company's bond holders.

Saybrook also structured and negotiated the purchase of
$120 million of 10.359% Senior Secured Notes of Foster Wheeler by
a group of institutional investors.  This investment, in
conjunction with the exchange, eliminates substantially all
material scheduled corporate debt maturities prior to 2011.

Jonathan Rosenthal, the Partner who led the transaction team for
Saybrook, said, "At the end of the day, holders believed in the
Company's prospects and its management team.  Foster Wheeler's
restructuring positions the Company to compete effectively in the
global engineering and construction marketplace.  We are pleased
to have assisted in the completion of this complex transaction."

"The completion of this equity-for-debt exchange is the most
significant accomplishment at Foster Wheeler in many years," said
Raymond J. Milchovich, Chairman, President, and Chief Executive
Officer.  "We have provided a dramatically improved capital
structure to support our worldwide operating subsidiaries."

Saybrook is an investment bank engaged in capital management and
financial advisory services.  The firm advises its clients in two
primary arenas: restructuring and real estate.  Saybrook's
corporate restructuring professionals have advised constituencies
in dozens of high profile reorganizations, including five of the
largest bankruptcies in history.  To find out more, please visit
http://www.saybrook.net/

                        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 September 24, 2004, Foster Wheeler's balance sheet showed a
$441,238,000 stockholders' deficit, compared to an $872,440,000
deficit at December 26, 2003.


FRANKLIN CAPITAL: Raises $3,245,000 in Private Equity Placement
---------------------------------------------------------------
Franklin Capital Corporation (AMEX: FKL) has closed a
$3,245,000 private placement of shares of its common stock and
warrants to purchase additional shares of its common stock.
Proceeds from the private placement will be used in connection
with Franklin's previously announced restructuring and
recapitalization plan, including to expedite Franklin's entry into
the medical products/health care solutions industry and financial
services industry.

The shares of common stock and warrants to purchase additional
shares of common stock issued in connection with the private
placement have not been registered under the Securities Act of
1933, as amended, and may not be offered or sold unless they are
so registered or are exempt from the registration requirements.

Franklin Capital Corporation originates and services direct and
indirect loans for itself and its sister company Franklin
Templeton Bank and Trust, F.S.B. Eight different loan programs are
offered, allowing Franklin Capital Corporation to serve the needs
of prime, non-prime and sub-prime customers throughout the United
States.

                          *     *     *

As reported in the Troubled Company Reporter on August 24, 2004,
Franklin Capital Corporation's former independent accountants,
Ernst & Young LLP, indicated in its reports dated March 5, 2004
and March 7, 2003 on Franklin's financial statements, substantial
doubt about the company's ability to continue as a going concern.


GADZOOKS INC: October Same Store Sales Up 14.1% from Last Year
--------------------------------------------------------------
Gadzooks, Inc. (OTC Pink Sheets: GADZQ) reported that sales for
the four weeks of fiscal October ended October 30, 2004 totaled
$10.5 million. Comparable store sales increased 14.1 percent for
the October period compared to the same period in fiscal 2003.
Total sales for the first 39 weeks of fiscal 2004 were $137.2
million.

Sales for the third quarter ended October 30, 2004 totaled $39.6
million. Comparable store sales increased 18.6 percent for the
third quarter compared to the same period of fiscal 2003.

Jerry Szczepanski, Chairman and Chief Executive Officer of
Gadzooks said, "We are very pleased again with our performance
this month. We now have put four months of solid double digit
comps in a row since the one year anniversary of our concept
change in July."

Szczepanski added, "Our recent agreement with investment funds to
provide financing to help us emerge from Chapter 11 and the
completion of our Tranche B financing to provide seasonal
borrowing capacity has all been completed in the last two weeks.
Combining this with our continued sales growth is a breath of
fresh air for our Company."

Headquartered in Carrollton, Texas, Gadzooks, Inc. --
http://www.gadzooks.com/-- is a mall-based specialty retailer
selling casual clothing, accessories and shoes for 16-22 year old
females. The Company now operates 243 stores in 40 states. The
Company filed for chapter 11 protection on February 3, 2004
(Bankr. N.D. Tex. Case No. 04-31486). Charles R. Gibbs, Esq., and
Keith Miles Aurzada, Esq., at Akin Gump Strauss Hauer & Feld, LLP,
represent the Debtor in its restructuring efforts. When the
Company filed for protection from its creditors, it listed
$84,570,641 in total assets and $42,519,551 in total debts.


GENOIL INC: Acquires Majority Interest in Velox Corporation
-----------------------------------------------------------
Genoil has acquired a controlling interest in the Velox
Corporation. In the past year Genoil entered into a worldwide
licensing agreement to market and manufacture the "Maxis" oil and
water separation system developed by Velox. Through a series of
transactions involving the acquisition of approximately 1.2
million shares Genoil has now acquired a majority interest in
Velox. The Maxis is a cyclonic oil/water separation technology
that can process large volumes of water achieving a high quality
separation of oil from water. In almost all conditions the Maxis
system dramatically reduces or eliminates the requirements for
heating and chemical treatments in the knock-out phase of
oil/water separation thereby significantly reducing costs. The
small percentage of water remaining in the separated oil depends
on the quality of crude and the ambient temperature of the flow.

Furthermore, the small percentage of oil remaining in the
separated water flow is lower than nearly all existing
conventional systems on the market. In combination with Genoil's
existing oil/water separation technologies such as the Crystal,
the Diamond and the new Claris, extremely low levels of oil in
water can be achieved thereby making it possible for producers to
meet demanding environmental standards and regulations. Thus, the
Maxis complements Genoil's oil/water separation technology and
will be a valuable addition to Genoil's goal of providing low
maintenance and low cost solutions to the oil and gas industry.

A key characteristic of the Maxis system is its uniquely small
footprint in comparison to most conventional systems. While Maxis
is a highly efficient technology for on-shore producers, its small
footprint makes it especially attractive for offshore producers
where space is at a premium. Genoil is actively pursuing both
markets.

The Maxis system also complements the Genoil hydroconversion
upgrading system known as GHU. In field conditions where producers
wish to create "field upgraders" to upgrade low API crude to
diluent standards thereby producing pipeline spec crude, Genoil
has been able to work with producers to design field upgrading
modules which combine the Maxis system with field GHU units. The
Maxis units are able to break through the "oil/water separation
bottleneck" at field level locations and directly supply separated
oil to field GHU upgraders. Genoil is currently working with an
international producer in the design of such a module. While
Genoil pursues marketing of its Maxis technology for use in the
international oil industry, the Velox Corporation will
independently focus on other major uses for the Maxis system in
the world market. New international environmental regulations will
soon require shipping firms to equip their ships with means to
clean up the ballast water that ships dump back into the ocean or
harbors. The Maxis system is ideally designed to meet these new
and demanding environmental requirements. It is estimated that
84,000 ships worldwide will have to adopt new ballast cleansing
technologies to meet international and regional environmental
standards within the next few years. The Velox Corporation will be
actively pursuing this major market.

                        About the Company

Genoil is a technology development company providing solutions to
the oil and gas industry through the use of proprietary
technologies. Genoil's shares are listed on the TSX Venture
Exchange under the symbol GNO.

The proposed issue of shares remains subject to Genoil receiving
regulatory approval from the TSXV.

                          *     *     *

                       Going Concern Doubt

The Corporation has not achieved commercial operations from its
various patents and technology rights and continues to incur
losses. At March 31, 2004, the Company has a working capital
deficiency of $3,044,177, including a note payable due in January
2005. The future of the Corporation is dependent upon its ability
to maintain the continued financial support of the note holder,
and obtain additional financing to fund the development of
commercial operations. These consolidated financial statements are
prepared on the basis that the Corporation will continue to
operate throughout the next fiscal period to March 31, 2005 as a
going concern. A failure to continue as a going concern would then
require that stated amounts of assets and liabilities be reflected
on a liquidation basis, which would differ from the going concern
basis.


GITTO GLOBAL: Inks Sale Pact with Unidentified Horse Bidder
-----------------------------------------------------------
Emily Young, writing for the Sentinel & Enterprise in Fitchburg,
Mass., reports that Gitto Global Corporation signed a purchase and
sale agreement last week.

"We signed a purchase and sale agreement to sell the company,"
Thomas Doherty at Argus Management, serving at Gitto/Global's
Chief Restructuring Officer, told Ms. Young.  "We'll continue to
entertain potential buyers and keep talking to other companies to
maximize the cash back."

"This is an initial purchaser," Mr. Doherty continued.  "There
will be a hearing in court where people will be able to outbid
(this purchaser)."    

"It's good news for our customers and our creditors down the
line," Mr. Doherty added, declining to reveal the potential
buyer's identity or the purchase price to Ms. Young.  

Headquartered in Lunenburg, Massachusetts, Gitto Global
Corporation -- http://www.gitto-global.com/-- manufactures  
polyvinyl chloride, polyethylene, polypropylene and thermoplastic
olefinic compounds.  The Company filed for chapter 11 protection
on September 24, 2004 (Bankr. D. Mass. Case No. 04-45386).  Andrew
G. Lizotte, Esq., at Hanify & King P.C., represents the Debtor in
its restructuring efforts.  When the Debtor filed for protection
from its creditors, it estimated more than $10 million in assets
and more than $50 million in debts.


GOODYEAR TIRE: Appoints Joseph Copeland Sr. Vice President
----------------------------------------------------------
The Goodyear Tire & Rubber Company (NYSE: GT) reported that Joseph
Copeland, formerly president of the company's chemical business,
has been named senior vice president of business development,
strategy and restructuring for Goodyear.  The new appointment
combines the business development responsibilities previously led
by Rick Navarro, as well as the strategic and restructuring
initiatives that were part of the previous assignment of Chief
Financial Officer Richard Kramer.

"In prior assignments with the company, Joe has displayed unique
leadership capabilities that have resulted in excellent overall
performance as well as a clear understanding of elements that will
form the core of strategy going forward," said Goodyear Chairman
and Chief Executive Officer Robert J. Keegan.  "I have complete
confidence in Joe's capabilities to help us drive the company's
turnaround in his new capacity."

Mr. Keegan said in addition to the considerable skills and
experiences Copeland brings to the newly created position, the
consolidation of business development and strategy will result in
net cost savings for the company.  Mr. Navarro, who implemented a
comprehensive review process for business portfolio analysis, now
has been assigned to work on special strategic projects reporting
to Mr. Keegan.

Mr. Copeland, 43, served as the director of finance for both the
Engineered Products and Chemical divisions of Goodyear.  Prior to
those assignments, he held senior positions in both technical
services and e-commerce for the company's Chemical Division and
North American Tire unit, respectively. Mr. Copeland joined
Goodyear in August 2000.

Before joining Goodyear, Mr. Copeland served in important
management roles at Ford Motor Company and Intel Corporation.
While at Ford, between 1995 and 1997, Mr. Copeland served on the
team that introduced the new and successful Jaguar S-Type to the
company's luxury vehicle line.  He also helped structure Ford's
entry into the Indian market through the creation of a joint
venture.  At Intel from 1997 to 2000, Mr. Copeland was senior
finance manager for its e-commerce and Internet marketing group,
where he helped develop the strategy for the company's entry into
the channel.  In experience, Mr. Copeland practiced corporate law
in Washington, D.C., from 1988 to 1993.  He received his
undergraduate degree in 1983 and his law degree in 1988, both from
Baylor University.  He received his MBA in 1995 from the
University of Chicago.

Headquartered in Akron, Ohio, Goodyear manufactures tires,
engineered rubber products and chemicals in more than 80
facilities in 28 countries.  It has marketing operations in almost
every country around the world.  Goodyear employs about 85,000
people worldwide.

                          *     *     *

As reported in the Troubled Company Reporter on July 29, 2004,
Standard & Poor's Ratings Services assigned a 'B+' secured debt
rating and a '2' recovery rating to The Goodyear Tire & Rubber
Co.'s proposed $500 million senior secured funded credit facility.
The senior secured and recovery ratings indicate a strong
likelihood of substantial recovery of principal (80% to 100%) in
the event of a default or bankruptcy.

At the same time, Standard & Poor's affirmed the 'B+' corporate
credit rating on Akron, Ohio-based Goodyear.  The company has
total debt of about $6 billion (including operating leases and
sold accounts receivable) and underfunded employee benefit
obligations of $5.8 billion.  The outlook is stable.

The new facility will replace Goodyear's existing $680 million
revolving credit facility and will have the same collateral
package.  The facility will be used primarily to support
outstanding letters of credit, but Goodyear will also have the
option to use the proceeds for general corporate purposes.  The
facility will mature in September 2007 and will conclude the
financing requirements of Goodyear's union agreements.

"The ratings on Goodyear reflect the company's very weak financial
profile, characterized by weak cash flow generation, poor
earnings, onerous debt maturities, and heavy underfunded employee
benefit liabilities," said Standard & Poor's credit analyst Martin
King. "These factors more than offset the company's business
strengths, including its position as one of the three largest
global tire manufacturers, with good geographic diversity, strong
distribution, and a well-recognized brand name."


GRANITE INC: Voluntary Chapter 11 Case Summary
----------------------------------------------
Debtor: Granite, Inc.
        dba Granite Glass and Fence
        dba Dempsey-Adams Carstar
        1837 Madison Avenue
        Granite City, Illinois 62040
        Tel: (618) 877-5400

Bankruptcy Case No.: 04-34487

Type of Business:  The Company has three divisions: Dempsey-Adams
                   Carstar is a nationwide collision repair
                   service that specialize in the latest body and
                   frame straightening process and computerized
                   paint matching and offer on-site glass repair.
                   Granite, Inc.'s glass division specializes in
                   commercial glazing, including plate and safety
                   glass, insulated units and commercial
                   storefronts.  Granite Inc.'s fencing division
                   provides high-quality commercial, industrial
                   and residential fencing.
                   See http://graniteglassandfence.com/

Chapter 11 Petition Date: November 5, 2004

Court: Southern District of Illinois (East St Louis)

Debtor's Counsel: Steven M. Wallace, Esq.
                  Blackwell Sanders Peper Martin
                  720 Olive Street, Suite 2400
                  Saint Louis, Missouri 63101
                  Tel: (314) 345-6452
                  Fax : (314) 345-6060

Estimated Assets: $1 Million to $10 Million

Estimated Debts:  $0 to $50,000

The Debtor did not file a list of its 20 Largest Unsecured
Creditors.


GREATER FELLOWSHIP: Case Summary & 16 Largest Unsecured Creditors
-----------------------------------------------------------------
Debtor: Greater Fellowship Ministries, Inc.
        aka Healing Center Full Gospel Baptist Church
        3885 Tchulahoma Road
        Memphis, Tennessee 38118

Bankruptcy Case No.: 04-37163

Type of Business: The Debtor operates a church.

Chapter 11 Petition Date: November 2, 2004

Court: Western District of Tennessee (Memphis)

Judge: Jennie D. Latta

Debtor's Counsel: Bevanne J. Bowers, Esq.
                  Law Office of Bevanne J. Bowers
                  605 Poplar Avenue
                  Memphis, TN 38105
                  Tel: 901-335-8708

Total Assets: $1,100,000

Total Debts:  $1,154,822

Debtor's 16 Largest Unsecured Creditors:

Entity                        Nature Of Claim       Claim Amount
------                        ---------------       ------------
IRS Insolvency Unit           Back taxes                 $70,000

Martin Leasing                Equipment                  $25,000
                              Secured value:
                              $15,000

AmSouth Bank                  Credit card                $23,000

Chase Financial               Equipment                  $20,000
                              Secured value:
                              $10,000

WMC TV                        Advertisement               $8,800

Nextel Communications         Phone service               $2,700

Diversifed Copy Products      Supplies                    $1,500

Lifeway Bookstore             Supplies                      $900

ADT Alarm                     Security system               $800

Sprint                        Phone service                 $800

American Marketing            Security                      $600

Discount School Supplies      Supplies                      $386

Time Warner Bankruptcy Unit   Cable                         $177

Mid-American Specialties      Supplies                       $74

Reliable Office Supplies      Supplies                       $85


HARVEST ENERGY: Increases Share Exchange Ratio to 1.05604
---------------------------------------------------------
Harvest Energy Trust (TSX: HTE.UN) reported an increase to the
Exchange Ratio of the Exchangeable Shares of Harvest Energy Trust
from 1.04703 to 1.05604. This increase will be effective on
November 15th, 2004.

As part of the Plan of Arrangement with Storm Energy which closed
on June 30, 2004, Harvest issued Exchangeable Shares which are
exchangeable into trust units at a ratio that adjusts each month.
The Exchangeable Shares are not publicly traded. However, holders
of Harvest Exchangeable Shares can exchange all or a portion of
their holdings at any time by giving notice to their investment
advisor or Valiant Trust Company at its principal transfer office
at 310, 606 - 4th Street SW, Calgary, AB, T2P 1T1 (telephone: 403-
233-2801).

Harvest Energy Trust is a Calgary-based energy trust actively
managed to deliver stable monthly cash distributions to its
Unitholders through its strategy of acquiring, enhancing and
producing crude oil, natural gas and natural gas liquids. Harvest
trust units are traded on the Toronto Stock Exchange (TSX) under
the symbol "HTE.UN". Please visit Harvest's website at
http://www.harvestenergy.ca/for additional corporate information  
and recent corporate presentations.

                          *     *     *

As reported in the Troubled Company Reporter on Oct. 5, 2004,
Standard & Poor's Ratings Services assigned its 'B+' long-term
corporate credit rating to Calgary, Alta.-based Harvest Energy
Trust and its 'B-' senior unsecured debt rating to the proposed
$200 million seven-year bond to be issued by Harvest Operations
Corporation, a wholly owned subsidiary of Harvest Energy Trust.
The debt is fully guaranteed by the trust and all its wholly owned
subsidiaries.


HEALTH CARE: Fitch Explains BB+ Preferred Stock Rating in Detail
----------------------------------------------------------------
Fitch Ratings has published a credit analysis report on Health
Care REIT, Inc. (HCN) providing insight into Fitch's rationale for
its ratings of 'BBB-' for the company's $875 million of
outstanding senior unsecured notes and the 'BB+' for the
$289 million of preferred stock.  The Rating Outlook is Positive.

Fitch's ratings reflect favorably on:

   -- HCN's good asset diversity with 379 health care facilities
      spread across 33 states, including:

         -- Florida (16% of investment),
         -- Massachusetts (12%),
         -- North Carolina (9%),
         -- Texas (7%) and
         -- Tennessee (6%),

   -- the company's manageable use of debt leverage at
      approximately 42% of undepreciated book capital (as of
      Sept. 30, 2004) and

   -- its sizeable unencumbered asset pool.

Financial flexibility is satisfactory for the rating, reflecting
nearly 75% availability under the company's $340 million unsecured
revolving credit facilities, proven access to debt and equity
capital and a well-laddered debt maturity schedule.  Additional
credit considerations are the company's 2.5 times increase in the
number of assets it has under master leases (now at 83% of real
property owned) as well as very low development exposure
(approximately 1% of gross depreciable property).

Additionally, HCN's Positive Rating Outlook continues to reflect
its improving credit statistics and overall leverage.  The
company's fixed-charge coverage has steadily improved to 2.7x as
of Sept. 30, 2004, from a low of 2.4x at Dec. 31, 2000.
Furthermore, the company's ratio of total debt-to-undepreciated
book capital has improved to 41.8% as of Sept. 30, 2004.  This
represents a 200 basis point improvement from 43.8% reported as of
Dec. 31, 2003.  Finally, the Positive Rating Outlook recognizes
the company's stringent and conservative underwriting of tenants.
The company's underwriting process and ongoing monitoring of its
tenants has aided HCN in avoiding many of the operator bankruptcy
pitfalls that other health care real estate investment trusts
(REITs) have faced.  The company's stated strategy of 'partnering'
with regional, nonpublic operators has, over time, proven to be a
sound business plan.

HCN, based in Toledo, Ohio, is an approximately $2.6 billion
(total undepreciated book capitalization) equity REIT focused on
the assisted living (57% of total investment), skilled nursing
(37%) and specialty care (6%) sectors.  The company specializes in
sale/leaseback and mortgage investments of long-term health care
facilities.  As of Sept. 30, 2004, the company had investments in
379 health care facilities located in 33 states with 49 operators
and had total assets of approximately $2.5 billion.

For a copy of the credit analysis, visit the Fitch Ratings Web
site at http://www.fitchratings.com/


HORNBECK OFFSHORE: Launches Cash Tender Offer for 10-5/8% Notes
---------------------------------------------------------------
Hornbeck Offshore Services, Inc. (NYSE: HOS) has commenced a
cash tender offer to purchase any and all of its $175,000,000
aggregate principal amount 10-5/8% Senior Notes due 2008
(CUSIP 440536 AB 6). In connection with the Offer, the Company
is soliciting consents to proposed amendments that would eliminate
certain restrictive covenants and default provisions contained in
the indenture governing the Notes.

The Offer and the Consent Solicitation are being made pursuant
to the terms and subject to the conditions set forth in the
Company's Offer to Purchase and Consent Solicitation Statement
dated November 3, 2004, and the Consent and Letter of
Transmittal, copies of which are available from the Information
Agent and Tender Agent, Global Bondholder Services, by calling
(866) 470-3800 (US toll-free) or (212) 430-3774 (collect).

Hornbeck Offshore has also retained Goldman, Sachs & Co. as
Dealer Manager for the Offer and Solicitation Agent for the
Consent Solicitation. Questions about the Offer or the Consent
Solicitation may be directed to the Credit Liability Management
Group of Goldman, Sachs & Co. at (800) 828-3182 (US toll-free)
or (212) 357- 5680 (collect).

Hornbeck Offshore is offering to purchase the Notes using fixed-
spread pricing that will result in total consideration for each
$1,000 principal amount of Notes validly tendered equal to the
present value on the applicable settlement date of the optional
redemption price of $1,053.13 at the first call date for the
Notes, August 1, 2005, plus the interest that would accrue from
the last interest payment date on the Notes to the first call
date, as determined by reference to a fixed spread of 0.75% over
the yield to maturity of the 1.50% U.S. Treasury Security due
July 31, 2005, minus accrued interest on the Notes from the last
interest payment date to the applicable settlement date.

Holders who tender their Notes prior to 5:00 p.m., Eastern time,
on November 17, 2004 will be eligible to receive the total
consideration, which includes a consent payment equal to $30 per
$1,000 of principal. Holders who tender their Notes after the
Consent Time but prior to 5:00 p.m., Eastern time, on December 3,
2004 will not be eligible to receive the $30 consent payment. In
addition, Hornbeck Offshore will pay accrued interest up to, but
not including, the applicable settlement date on all Notes
accepted in the Offer. Subject to the conditions of the Offer, the
initial settlement date with respect to all Notes tendered prior
to the Consent Time will be within five business days of the
Consent Time, which is expected to be November 24, 2004. A final
settlement date will occur promptly after the Expiration Time with
respect to all Notes tendered after the Consent Time but prior to
the Expiration Time.

The purchase price for the Notes will be determined by the Dealer
Manager and publicly announced by 5:00 p.m., Eastern time, on
November 16, 2004.

Any holder who tenders its Notes will be deemed to have delivered
its consent to the proposed amendments to the Indenture. The
Consent Time is the deadline for holders to withdraw tenders of
their Notes and to revoke related consents to the proposed
amendments. Holders that tender their Notes prior to the Consent
Time will be eligible to receive the total consideration on the
initial settlement date, and holders that tender their Notes after
the Consent Time but prior to the Expiration Time will be eligible
to receive the total consideration less the consent payment on the
final settlement date.

This news release is not an offer to purchase, a solicitation of
an offer to sell or a solicitation of consent with respect to any
securities. The Offer is being made solely by the Offer to
Purchase and Consent Solicitation Statement dated November 3,
2004.

                        About the Company

Hornbeck Offshore Services, Inc. is a leading provider of
technologically advanced, new generation offshore supply vessels
in the U.S. Gulf of Mexico and select international markets, and
is a leading transporter of petroleum products through its fleet
of ocean-going tugs and tank barges, primarily in the northeastern
U.S. and in Puerto Rico.

                          *     *     *

As reported in the Troubled Company Reporter on Aug. 30, 2004,
Standard & Poor's Ratings Services raised its corporate credit
rating and senior unsecured ratings on Hornbeck Offshore Services,
Inc., to 'BB-'from 'B+' following a review of current and expected
growth initiatives and Hornbeck's ability to fund them in a manner
that will not hurt credit quality. The ratings were also removed
from CreditWatch with positive implications, where they were
placed on March 11, 2004, following the announcement that Hornbeck
would issue six million shares of common stock in an IPO. The
outlook is now stable.

Mandeville, Louisiana-based Hornbeck currently has $175 million of
debt.

"The ratings upgrade reflects Hornbeck's improved liquidity and
financial flexibility following its IPO," said Standard & Poor's
credit analyst Paul B. Harvey. "With nearly $85 million in
liquidity as of June 30, 2004, Hornbeck should have adequate
liquidity for existing construction plans. The company also now
has the ability to issue common equity to help fund its fleet
expansion, limiting its reliance on its credit facility and
private capital infusions for growth," he continued.


IRON MOUNTAIN: Moody's Junks Five Classes After Review
------------------------------------------------------
Moody's Investors Service downgraded the ratings of Iron Mountain
Incorporated.  The senior implied rating was lowered to B2 from
B1.  At the same time, Moody's assigned a rating of B2 to the
company's new guaranteed senior secured $150 million tranche D
term facility due 2011 and affirmed the company's SGL-3 liquidity
rating.  The ratings were assigned a stable outlook.  This will
conclude a review for possible downgrade, which was initiated on
November 3, 2004.

The downgrade reflects the company's continued appetite for debt
financed acquisitions in excess of Moody's expectations, the
growing risk profile of the company's business mix, and the weak
3% estimated pro forma 2004 free cash flow to total debt and the
substantial negative free cash flow after acquisitions.

The ratings reflect acquisition risk and the company's sustained
tolerance for leverage.  Pro forma for the debt financed
acquisition of Connected Corporation which is expected to close in
the fourth quarter, total debt plus eight time operating leases is
estimated at 6 times the twelve months ended September 30, 2004
EBITDAR, and almost 2 times last twelve months revenues.  Pro
forma debt to book capitalization is estimated to increase to 64%
from 62% at December 31, 2003.  The ratings also incorporate the
company's negative tangible equity of approximately $766 million
at September 30, 2004 related to a high level of intangible assets
and a modest fixed charge coverage of 1.6 times, inclusive of
operating leases and current portion of long term debt for the
twelve months ended September 30, 2004.

The ratings are supported by:

   (1) the company's dominant market share of the stable record
       management business;

   (2) a diversified customer base; and

   (3) consistent gross margins.  

Moody's believes that over time the benefit of the lower risk
profile of the maturing core domestic storage business will
diminish because of the acquisition risk and cash investment needs
of the digital, shredding and international businesses.  This
equation makes the leverage profile of the company unsustainable
at the previous rating category.

The rating outlook is stable.  Further improvement in the rating
would be predicated on improved cash generation from organic
growth, significant debt reduction and no decapitalization of the
company.  Moody's does not expect Iron Mountain to substantially
reduce total debt using free cash flow in the near term.  The
failure to sustain meaningful free cash flow generation, an
increase in leverage or decapitalization of the company could
pressure the rating.  Going forward, Moody's will maintain its
analytical focus on Iron Mountain's operational and funding
strategy for international expansion, shredding and its digital
businesses as well as the cash contribution of acquired
businesses.  Moody's will also monitor the existence, or lack
thereof, of covenants that protect investors from fund transfers
to unrestricted subsidiaries.

The SGL-3 rating reflects Moody's expectation that operating cash
flow, combined with cash balances, and availability under its
secured revolving credit facility should be adequate to cover
capital needs over the coming year.  Moody's notes that combined
availability under total committed revolvers has reduced
significantly since June 30, 2004.  Despite the issuer's newly
negotiated covenant tests signed, Moody's believes the company
will maintain a modest cushion under its financial covenant tests
for the next twelve months.  In addition, the company does not
enjoy any meaningful alternate sources of liquidity.

The proceeds of the $150 million guaranteed secured term loan D
will be used to finance the acquisition of Connected Corporation
for $117 million as well as to finance other specified
acquisitions including the buy-out of a minority interest joint
venture partner.

The B2 rating on the guaranteed senior secured credit facility
reflects the contractual benefits and limitations of the
collateral package and the upstream guarantees of the domestic
subsidiaries.  The loan is the joint obligation of Iron Mountain
Incorporated and Iron Mountain Incorporated Canada Corporation.   
The security is evidenced by a perfected first priority lien on
100% of the capital stock of domestic subsidiaries, and 65% of the
stock of foreign subsidiaries.  Earlier this year the EBITDA to
Interest Expense coverage test was eliminated and replaced with a
Guarantors Domestic Leverage test.  The Fixed Charge coverage test
was modified to capture any dividends paid.  The company obtained
covenant relief today for the maximum permitted Consolidated Net
Debt to EBITDA test and the Guarantors Domestic Leverage test.

Moody's notes that the GBP210 million (approximately $386 million)
guaranteed secured revolver and term loan and overdraft facility
due March 2009 which is the joint obligation of Iron Mountain
Europe and its subsidiaries has a priority call on cash generated
at IME.  This Sterling facility is guaranteed by the IME
subsidiaries but not by IMI.  Moody's does not rate the IME loan.

The Caa1 ratings on the subordinated notes reflect the notes'
contractual subordination to a significant amount of secured
indebtedness as well as approximately $1.1 billion of debt and
trade payables of the non-guarantor subsidiaries at
December 31, 2003.  The notes are guaranteed by substantially all
of the company's direct and indirect domestic wholly owned
subsidiaries on a joint and several basis.  However, a growing
proportion of the company's total assets are excluded from the
guarantee structure that supports the parent company's debt
repayment.  Non guarantors include Iron Mountain Canada
Corporation, Iron Mountain Europe Limited and their respective
subsidiaries and other international subsidiaries.  The
non-guarantor subsidiaries generated 19% of consolidated revenue
for fiscal year 2003 and held approximately 32% of consolidated
assets at December 31, 2003.

Moody's notes that the restricted payments covenant under the most
recent bond indenture provides for a sizable basket of
$1.4 billion for investments in unrestricted subsidiaries,
investments or guarantees of non-subsidiaries and for stock
repurchases.  In addition, there are no requirements to use the
proceeds from the sale of foreign assets to reduce debt at the
parent company.  These aspects of the indenture become more
important as the company continues to expand its investments in
non-guarantor subsidiaries with the proceeds from US issued public
debt.  While covenants under the bank credit facility may be more
restrictive, they are also susceptible to future negotiations.

The rating actions are:

   * $350 million guaranteed senior secured revolving credit
     facility due 2009, downgraded to B2 from B1;

   * $200 million guaranteed senior secured Term Loan B due 2011,
     downgraded to B2 from B1;

   * $150 million guaranteed senior secured Term Loan D due 2001,
     assigned a B2;

   * $150 million principal amount of 8.25% guaranteed senior
     subordinated notes due 2011, downgraded to Caa1 from B3;

   * $481 million principal amount of 8.625% guaranteed senior
     subordinated notes due 2013, downgraded to Caa1 from B3;

   * $431 million principal amount of 7.75% guaranteed senior
     subordinated notes due 2015, downgraded to Caa1 from B3;

   * $320 million principal amount of 6.625% guaranteed senior
     subordinated notes due 2016, downgraded to Caa1 from B3;

   * GBP150 million issue of 7.25% guaranteed senior subordinated
     notes due 2014, downgraded to Caa1 from B3;

   * Senior Implied Rating downgraded to B2 from B1;

   * Senior Unsecured Issuer Rating downgraded to B3 from B2;

SGL affirmed at SGL-3.

Iron Mountain Incorporated, based in Boston, Massachusetts, is an
international provider of records and information management and
related services.  Total sales for fiscal 2003 were $1.5 billion.


J.P. MORGAN: S&P Assigns Low-B Rating to Six Certificate Classes
----------------------------------------------------------------
Standard & Poor's Ratings Services assigned its preliminary
ratings to J.P. Morgan Chase Commercial Mortgage Securities
Corp.'s $2.0 billion commercial mortgage pass-through certificates
series 2004-CIBC10.

The preliminary ratings are based on information as of
November 4, 2004.  Subsequent information may result in the
assignment of final ratings that differ from the preliminary
ratings.

The preliminary ratings reflect the credit support provided by the
subordinate classes of certificates, the liquidity provided by the
trustee, the economics of the underlying mortgage loans, and the
geographic and property type diversity of the loans.  Classes A-1,
A-2, A-3, A-4, A-5, A-6, A-J, B, C, D, and E are currently being
offered publicly.  Standard & Poor's analysis of the portfolio
determined that, on a weighted average basis, the pool has a debt
service coverage of 1.47x, a beginning LTV of 92.4%, and an ending
LTV of 76.2%.

A copy of Standard & Poor's complete presale report for this
transaction can be found on RatingsDirect, Standard & Poor's Web-
based credit analysis system, at http://www.ratingsdirect.com/  
The presale can also be found on the Standard & Poor's Web site at
http://www.standardandpoors.com Select Credit Ratings, and then  
find the article under Presale Credit Reports.
   
                  Preliminary Ratings Assigned
     J.P. Morgan Chase Commercial Mortgage Securities Corp.
   
            Class         Rating         Amount ($)
            -----         ------         ----------
            A-1           AAA            36,467,000
            A-2           AAA            91,592,000
            A-3           AAA           250,536,000
            A-4           AAA           180,896,000
            A-5           AAA           174,874,000
            A-6           AAA           387,056,000
            A-1A          AAA           465,920,000
            A-J           AAA           119,051,000
            B             AA             62,006,000
            C             AA-            17,361,000
            D             A+             14,881,000
            E             A              17,362,000
            F             A-             22,322,000
            G             BBB+           27,282,000
            H             BBB            22,322,000
            J             BBB-           27,283,000
            K             BB+             4,960,000
            L             BB              7,441,000
            M             BB-            12,401,000
            N             B+              4,960,000
            P             B               7,441,000
            Q             B-              2,480,000
            NR            N.R.           27,283,292
            X-1*          AAA         1,984,177,292**
            X-2*          AAA         1,917,535,000**
   
                   *      Interest-only class
                   **     Notional amount
                   N.R. - Not rated


KAISER ALUMINUM: Alpart & Kaiser Liquidation Plan Overview
----------------------------------------------------------
Alpart Jamaica, Inc., and Kaiser Jamaica Corporation delivered
their Joint Plan of Liquidation to United States Bankruptcy Court
for the District of Delaware on October 29, 2004.

The primary objectives of the Plan are to:

    (a) maximize the value of the ultimate recoveries to all
        creditor groups on a fair and equitable basis;

    (b) settle, compromise or otherwise dispose of certain claims
        and other disputes on terms that the Liquidating Debtors
        believe to be fair and reasonable under the circumstances
        and in the best interests of their estates and creditors
        and Kaiser Aluminum & Chemical Corporation, as the sole
        stockholder of each Debtor; and

    (c) effectuate the orderly liquidation and dissolution of the
        Liquidating Debtors.

Moreover, the Plan provides for, among other things:

    (a) the classification and treatment of claims and interests;

    (b) the establishment of a distribution trust to make
        distributions in accordance with the Plan;

    (c) the creation and administration of trust accounts; and

    (d) the liquidation of Alpart Jamaica and Kaiser Jamaica.

A full-text copy of the Liquidating Debtors' Disclosure Statement
is available for free at:

    http://bankrupt.com/misc/AJI_&_KJC_Disclosure_Statement.pdf

A full-text copy of the Liquidating Debtors' Liquidation Plan is
available for free at:

    http://bankrupt.com/misc/AJI_&_KJC_Joint_Liquidation_Plan.pdf

                          Sources of Cash

The cash available in the Liquidating Debtors' estates to fund the
Plan will come from:

    (a) the net cash proceeds to the Liquidating Debtors in
        connection with the sale of their interests in Alumina
        Partners of Jamaica pursuant to a purchase and sale
        agreement, after taking into account the costs and
        expenses of the sale payable by the Liquidating Debtors in
        accordance with the settlement of Claims among the Debtors
        and the satisfaction of any applicable Allowed Secured
        Claim with a valid and enforceable lien against the
        proceeds;

    (b) the proceeds, if any, received by the Liquidating Debtors
        under the Intercompany Claims Settlement; and

    (c) the proceeds, if any, received from the successful
        prosecution, settlement, or collection of preference
        actions, fraudulent actions, rights of set-off, and other
        claims or causes of action under Chapter 5 of the
        Bankruptcy Code and other applicable bankruptcy and non-
        bankruptcy law.

The Liquidating Debtors currently estimate that, as of the Plan
effective date, the Alpart Proceeds will be $274,400,000 and the
Intercompany Settlement Proceeds will be $4,000,000.  The Debtors
are not aware of any Recovery Actions -- and the Official
Committee of Unsecured Creditors has independently determined that
there are no viable preference actions concerning payments made by
the Liquidating Debtors -- and, accordingly, it has been assumed
that the Recovery Action Proceeds will be zero.

The estimated Alpart Proceeds as of the Effective Date includes
$20,000,000 that to be held in a cash collateral account to secure
the obligations of the Liquidating Debtors and the rest of the
Debtors under the February 12, 2002 postpetition credit agreement
among the Debtors, lenders, and Bank of America, N.A. On the
Effective Date, cash in the Liquidating Debtors' Cash Collateral
Account will be used to make the payments, if any, to KACC by the
Liquidating Debtors pursuant to the Intercompany Claims
Settlement.  Any remaining amounts held in the Cash Collateral
Account will not be released for distribution to holders of
Allowed Claims until amounts owing under the DIP Financing
Facility are paid in full and the DIP Financing Facility is
terminated.  The Liquidating Debtors and the Creditors Committee
currently expect that no Intercompany Settlement Payments will be
required and, accordingly, that the entire $20,000,000 -- plus
interest and earnings from investment -- held in the Cash
Collateral Account will ultimately be released for distribution to
holders of Allowed Claims.  The Release, however, is not expected
to occur before the Effective Date and may not occur before the
effective date of a KACC reorganization plan.  No assurance can be
given as to whether or when the release will occur or, if and when
the release does occur, as to how much cash will then remain in
the Cash Collateral Account.

                            Uses of Cash

The Liquidating Debtors' cash as of the Effective Date will be
used to:

    (a) fund the segregated trust account to be established and
        maintained to fund the payment of all reasonable fees,
        costs and expenses incurred by a trustee in connection
        with its performance of its duties as Distribution
        Trustee under the Plan or the trust agreement between the
        Liquidating Debtors and the Distribution Trustee;

    (b) fund the segregated trust account to be established and
        maintained by the Distribution Trustee to satisfy allowed
        secured claims, administrative claims, priority claims,
        and priority tax claims against the Liquidating Debtors'
        estates, in accordance with the Plan;

    (c) pay the fees of U.S. Bank National Association, as
        successor indenture trustee under the 9-7/8% Senior Note
        Indenture and the 10-7/8% Senior Note Indenture, and
        counsel for the ad hoc group of holders of senior notes
        composed of Trilogy Capital, Caspian Capital Partners,
        Varde Partners, Canyon Partners, Citadel Equity Fund,
        Ltd., Citadel Credit Trading, Ltd., Durham Asset
        Management, LLC, Farallon Capital Management, LLC, Troob
        Capital and Scoggin Capital, payable in accordance with
        the Plan up to an aggregate not to exceed $1,500,000;

    (d) make any required payments under the Intercompany Claims
        Settlement; and

    (e) fund the segregated trust account to be established
        and maintained by the Distribution Trustee to satisfy
        allowed unsecured claims against the Liquidating Debtors'
        estates with any remaining cash.

The Liquidating Debtors and the Creditors Committee currently
anticipate that available cash will be applied as (in millions):

Estimated Available Cash                                 $278.4

    Estimated Funding of:
       Distribution Trust Expenses Account                  (1.0)
       Priority Claims Trust Account              (12.5) - (17.5)
    Estimated Payment of:
       Senior Noteholder Fees                               (1.5)
       Intercompany Settlement Payments                      0.0
                                                  --------------
Estimated Cash Remaining to
    Fund Unsecured Claims Trust Account           $258.4 - 263.4
                                                  ==============

Moreover, based on the various estimates and assuming that
Subclass 3B votes to accept the Plan and there are no Allowed
Other Unsecured Claims, the aggregate cash ultimately to be
distributed to holders of Senior Note Claims, PBGC Claims, and
claims under the 12-3/4% senior subordinated notes due 2003, would
be (in millions):

                                             Estimated Aggregate
Subclass                                     Cash Distribution
--------                                    -------------------
Subclass 3A (Senior Notes Claims)               $162.7 to 171.1
Subclass 3B (Senior Subordinated Note Claims)               8.0
Subclass 3C (PBGC Claims)                          82.7 to 84.3

Although the Liquidating Debtors and the Creditors Committee
expect that the entire $20,000,000 to be held in the Cash
Collateral Account will ultimately be released for distribution to
holders of allowed claims, the amount is not expected to be
released before the Effective Date and, accordingly, it is
expected that the initial distributions to be made to holders of
allowed Senior Note Claims and the PBGC on or promptly after the
Effective Date will be less than what has been estimated.

                     Liquidating Transactions

On the Effective Date, the Distribution Trust Assets will be
transferred to and vest in the Distribution Trust, free and clear
of claims, liens and interests, except as may be otherwise
provided in the Intercompany Claims Settlement.  Upon the transfer
of the Distribution Trust Assets to the Distribution Trust, the
Liquidating Debtors will be deemed dissolved and their business
operations withdrawn for all purposes without any delay.

                          Corporate Action

On the Effective Date:

    * a Distribution Trust will be established;

    * a Distribution Trustee to act on behalf of the Distribution
      Trust will be appointed;

    * the Distribution Trust Assets will be transferred to the
      Distribution Trust;

    * Trust Accounts will be created;

    * cash will be distributed pursuant to the Plan; and

    * the Distribution Trust Agreement will be adopted, executed
      and implemented.

The Liquidating Transactions will not in any way merge the assets
of the Liquidating Debtors' estates, including the Trust
Accounts.  All claims against the Liquidating Debtors are deemed
fully satisfied in exchange for the treatment of the claims under
the Plan, and holders of allowed claims against either
Liquidating Debtor will have recourse solely to the applicable
Trust Accounts for the payment of their allowed claims in
accordance with the terms of the Plan.

All liens against the Distribution Trust Assets will be fully
released upon the holder of the lien receiving its full
distribution under the Plan, or upon the Effective Date if the
holder of the lien is not entitled to any distribution under the
Plan.

                 Creation of the Distribution Trust

On the Effective Date, the Liquidating Debtors and the
Distribution Trustee will enter into the Distribution Trust
Agreement, thereby creating the Distribution Trust.

The Distribution Trustee, whose identity will be disclosed at
least 10 days before the Confirmation Hearing, will be selected by
the Creditors Committee with the consent of the Liquidating
Debtors, and will be the exclusive trustee of the Distribution
Trust Assets.

On the Effective Date, the Debtors will transfer to the
Distribution Trust all the Distribution Trust Assets then owned by
the Estates, whereupon title to the Distribution Trust Assets will
irrevocably vest in the Distribution Trust, free and clear of
Claims, Liens, and Interests.

The Distribution Trust Assets include:

    (a) the Trust Accounts and any cash -- and any other property
        -- held by the Trust Accounts;

    (b) the rights of the Liquidating Debtors under or in respect
        of the Intercompany Claims Settlement, the Alpart Purchase
        Agreement or any causes of action not released by the
        Plan, including the Recovery Actions, and any proceeds
        thereof; and

    (c) the Alpart Proceeds, including any amounts paid over to
        the Distribution Trustee upon the termination of the DIP
        Financing Facility for deposit into the Unsecured Claims
        Trust Account as contemplated by the Plan.

The Distribution Trust will be established for the purpose of:

    * collecting, maintaining and administering any Distribution
      Trust Assets for the benefit of the creditors and claimants
      of the Estates;

    * liquidating -- including objecting to Claims and determining
      the proper recipients and amounts of distributions to be
      made from the Distribution Trust -- and distributing the
      Distribution Trust Assets for the benefit of the
      Beneficiaries who are determined to hold Allowed Claims as
      expeditiously as reasonably possible;

    * pursuing available causes of action, including Recovery
      Actions;

    * closing the Chapter 11 cases; and

    * implementing the Plan and completing dissolution;

The Distribution Trust will terminate upon the completion of its
liquidation and distribution duties pursuant to the terms of the
Distribution Trust Agreement.

                 Powers of the Distribution Trustee

(A) General Powers

The Distribution Trustee will be empowered to, among other things:

    * execute all agreements, instruments, and other documents and
      effect all other actions necessary to implement the Plan;

    * establish, maintain, and administer the Trust Accounts;

    * accept, preserve, receive, collect, manage, invest,
      supervise and protect the Distribution Trust Assets;

    * liquidate, transfer or otherwise dispose of the Distribution
      Trust Assets;

    * calculate and make distributions of the Distribution Trust
      Assets to holders of Allowed Claims;

    * comply with the Plan and exercise its rights and fulfill its
      obligations;

    * review, reconcile, settle or object to Claims and resolve
      any those objections;

    * investigate and, if appropriate, pursue any Recovery Actions
      or other available causes of action -- including any actions
      previously initiated by the Debtors and pending as of the
      Effective Date -- and raise any defenses in any adverse
      actions or counterclaims;

    * retain and compensate, without further Bankruptcy Court
      order, the services of professionals or other persons or
      entities to represent, advise and assist the Distribution
      Trustee in the fulfillment of its responsibilities in
      connection with the Plan and the Distribution Trust
      Agreement;

    * take steps as are necessary, appropriate, or desirable
      to coordinate with representatives of the estates of the
      Other Kaiser Debtors;

    * take actions as are necessary, appropriate or desirable to
      close the Chapter 11 cases;

    * file appropriate Tax returns on behalf of the Distribution
      Trust and Debtors and pay taxes or other obligations owed by
      the Distribution Trust;

    * pay all Distribution Trust Expenses using the Distribution
      Trust Expenses Account;

    * execute, deliver, and perform other agreements and documents
      or exercise other powers and duties as the Distribution
      Trustee determines, in its reasonable discretion, to be
      necessary, appropriate, or desirable to accomplish and
      implement the purposes and provisions of the Distribution
      Trust;

    * take actions as are necessary, appropriate or desirable to
      terminate the existence of the Liquidating Debtors under the
      laws of Jamaica; and

    * terminate the Distribution Trust in accordance with the
      terms of the Plan and Distribution Trust Agreement.

(B) Right to Object to Claims

After the Effective Date, only the Distribution Trustee, with the
prior consent of the Steering Committee will have the authority to
file, settle, compromise, withdraw or litigate to judgment
objections to Claims.  After the Effective Date, the Distribution
Trustee, with the prior consent of the Steering Committee, may
settle or compromise any Disputed Claim.

(C) Right to Pursue Causes of Action

In accordance with Section 1123(b) of the Bankruptcy Code, the
Distribution Trustee will retain and may enforce any claims,
demands, rights and causes of action that either Estate may hold
against any entity, including the Recovery Actions, to the extent
not released under the Plan.  In particular, the Distribution
Trustee will retain the right to pursue any adversary proceedings
available to the Liquidating Debtors in connection with the
Alpart Purchase Agreement or the Intercompany Claims Settlement.

              Indemnification of Distribution Trustee

The Distribution Trustee and the members of the Steering
Committee will be indemnified by the Distribution Trust from the
Distribution Trust Expenses Trust Account, except for any act or
omission constituting bad faith, fraud, willful misconduct, gross
negligence or a breach of its fiduciary duties.

              Compensation of the Distribution Trustee

The Distribution Trustee will receive fair and reasonable
compensation for its services, with such compensation to be paid
from the Distribution Trust Expenses Account.

                   Term of the Distribution Trust

The Distribution Trust will terminate upon:

    * the payment of all costs, expenses and obligations incurred
      in connection with administering the Distribution Trust;

    * the distribution of all remaining Distribution Trust Assets
      and proceeds in accordance with the provisions of the Plan,
      the Confirmation Order and the Distribution Trust Agreement;

    * the closure of the Chapter 11 cases; and

    * the completion of any necessary or appropriate reports, tax
      returns or other documentation.

Headquartered in Houston, Texas, Kaiser Aluminum Corporation --
http://www.kaiseral.com/-- operates in all principal aspects of  
the aluminum industry, including mining bauxite; refining bauxite
into alumina; production of primary aluminum from alumina; and
manufacturing fabricated and semi-fabricated aluminum products.  
The Company filed for chapter 11 protection on February 12, 2002
(Bankr. Del. Case No. 02-10429).  Corinne Ball, Esq., at Jones
Day, represent the Debtors in their restructuring efforts.  On
June 30, 2004, the Debtors listed $1.619 billion in assets and
$3.396 billion in debts.  (Kaiser Bankruptcy News, Issue No. 53;
Bankruptcy Creditors' Service, Inc., 215/945-7000)


KB TOYS: Wants Plan-Filing Period Extended to Jan. 14
-----------------------------------------------------
KB Toys, Inc., wants more time for file a chapter 11 plan.  
Specifically, pursuant to 11 U.S.C. Sec. 1121, the Debtor wants
its exclusive period in which to file a chapter 11 plan extended
to January 14, 2005, and wants its exclusive right to solicit
acceptances of that plan from creditors extended through March 14,
2005.

The Debtors tell the Bankruptcy Court they "believe that
additional time, particularly as the debtors enter their busy
holiday season, is necessary to allow the debtors to operate their
business during this critical time of year, finalize the
negotiations of the terms of the plan and prepare to file a plan
and related disclosure
statement."  

Last month, KB said it will close 141 to 238 underperforming
stores by Jan. 31, and plans to continue operating approximately
600 stores throughout the United States, the
Commonwealth of Puerto Rico and the American Territory of Guam,
when it emerges from chapter 11 in 2005.  The retailer started had
1,300 stores when it filed for chapter 11 protection early this
year.

The Bankruptcy Court will hold a hearing to consider the Debtor's
exclusivity extension request on Nov. 14.

KB Toys, Inc. -- http://www.kbtoys.com/-- filed for chapter 11  
protection (Bankr. Del. Case No. 04-10120) on January 14, 2004.  
Joel A. Waite, Esq., at Young, Conaway, Stargatt, & Taylor,
represents the toy retailer.


LAGUARDIA ASSOCIATES: Case Summary & Largest Unsecured Creditors
----------------------------------------------------------------
Lead Debtor: LaGuardia Associates, L.P.
             c/o 251 DeKalb Pike
             King of Prussia, Pennsylvania 19406

Bankruptcy Case No.: 04-34512

Debtor affiliates filing separate chapter 11 petitions:

      Entity                                     Case No.
      ------                                     --------
      Field Hotel Associates, L.P.               04-34514

Type of Business: The Debtor owns a 358 room Crowne Plaza Hotel
                  located at 104-04 Ditmars Boulevard, East
                  Elmhurst, New York.

Chapter 11 Petition Date: October 29, 2004

Court: Eastern District of Pennsylvania (Philadelphia)

Judge: Stephen Raslavich

Debtors' Counsel: Martin J. Weis, Esq.
                  Dilworth Paxon LLP
                  1735 Market Street
                  Philadelphia, PA 19103
                  Tel: 215-575-7000

Estimated Assets: $10 Million to $50 Million

Estimated Debts:  $10 Million to $50 Million

A. LaGuardia Associates, L.P.'s 20 Largest Unsecured Creditors:

Entity                                 Claim Amount
------                                 ------------
HIP Health Plan of NY                       $78,536

ECONnergy                                   $77,985

US Foodservice                              $58,631

Landmark Food Corp.                         $37,912

The State Insurance Fund                    $31,112

Micros Retail Systems, Inc.                 $27,550

Lodgenet Entertainment                      $21,465

Longacre Beef Co., Inc.                     $19,895

Mazur & Jaffe                               $18,709

Direct Machinery Sales Co.                  $17,118

Five Star Parking                           $16,489

KVL Audio Visual Services                   $15,831

Filco Carting Corp.                         $14,216

Shea Truck & Auto Repair                    $13,582

Otis Elevator Co.                           $11,968

American Hotel Register                     $11,576

ECONnergy                                   $10,760

Chalet Pastry Shop                          $10,377

R Best Produce, Inc.                        $10,067

Renoir French Cleaners & Tailors             $9,521

B. Field Hotel Associates' 20 Largest Unsecured Creditors:

Entity                                 Claim Amount
------                                 ------------
State Insurance Fund                       $117,281

Five Star Parking                           $96,248

Landmark Food Corporation                   $87,098

NYC Water Board                             $85,401

Proskauer Rose                              $54,732

Triple Crown Foods, Inc.                    $72,450

HIP Health Plan of NY                       $64,696

Top Shelf Meats, Inc.                       $59,436

Landshell Protective Agency                 $55,101

Ecconery                                    $48,490

Helmsbriscoe                                $40,306

Sunbelt Organization SVC                    $27,471

Panel Kerr Forster                          $29,943

Capital Cleaning Contract                   $30,300

HP Products, Corp.                          $30,112

Leon Sales                                  $25,114

Lodgenet Entertainment                      $24,380

Raymond's Mechanical                        $20,367

Derle Farms                                 $20,348

Littler Mendelson, P.C.                     $19,446


LYNX 2002-I: Moody's Slices Class D Notes' Rating to B3 from Ba2
----------------------------------------------------------------
Moody's Investors Service has taken action on notes issued by LYNX
2002-I, LTD.  The affected tranches are:

   (1) U.S. $97,000,000 Class C Floating Rate Notes, Due 2032,
       currently rated Baa2, have been placed on watch for
       possible downgrade, and

   (2) U.S. $20,000,000 Class D Floating Rate Notes, Due 2032 have
       been downgraded to B3 on watch for possible downgrade from
       Ba2.

Moody's has noted that LYNX 2002-I, LTD., which closed on
May 08, 2002, is violating the Class C Overcollateralization Test,
the Class D Overcollateralization Test, the Class D Interest
Coverage Test, and the Weighted Average Rating Factor Test.

Rating Action: Watchlist & Downgrade

Issuer: LYNX 2002-I, LTD.

Tranche:        U.S. $97,000,000 Class C Floating Rate Notes, Due
                2032
Prior Rating:   Baa2
Current Rating: Baa2 on watch for possible downgrade

Tranche:        U.S. $20,000,000 Class D Floating Rate Notes, Due
                2032
Prior Rating:   Ba2
Current Rating: B3 on watch for possible downgrade


MERRILL LYNCH: Fitch Places Low-B Rating on 17 Certificate Classes
------------------------------------------------------------------
Fitch Ratings has taken rating actions on these Merrill Lynch
Mortgage Loans, Inc. mortgage pass-through certificates:

   * Merrill Lynch Mortgage Loans, Inc., mortgage pass-through
     certificates, series 2000-3

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

   * Merrill Lynch Mortgage Loans, Inc., mortgage pass-through
     certificates, series 2003-A


     -- Classes 1-A and 2-A are affirmed at 'AAA';
     -- Class B-1 is affirmed at 'AA+';
     -- Class B-2 is affirmed at 'A+';
     -- Class B-3A is affirmed at 'A';
     -- Class B-3B is affirmed at 'BBB+';
     -- Class B-4 is affirmed at 'BBB-';
     -- Class B-5 is affirmed at 'B+'.

   * Merrill Lynch Mortgage Loans, Inc., mortgage pass-through
     certificates, series 2003-A1

     -- Classes 1-A, 2-A and 3-A are affirmed at 'AAA';
     -- Class M-1 upgraded to 'AAA' from 'AA';
     -- Class M-2 upgraded to 'AA' from 'A';
     -- Class M-3 upgraded to 'A' from 'BBB';
     -- Class B-1 upgraded to 'BBB' from 'BB';
     -- Class B-2 affirmed at 'B'.

   * Merrill Lynch Mortgage Loans, Inc., mortgage pass-through
     certificates, series 2003-A3

     -- Class I-A is affirmed at 'AAA'
     -- Class M-1 affirmed at 'AA';
     -- Class M-2 affirmed at 'A';
     -- Class M-3 affirmed at 'BBB';
     -- Class B-1 affirmed at 'BB';
     -- Class B-2 affirmed at 'B'.

   * Merrill Lynch Mortgage Loans, Inc., mortgage pass-through
     certificates, series 2003-B

     -- Classes A-1 and A-2 are affirmed at 'AAA';
     -- Class B-1 is affirmed at 'AA+';
     -- Class B-2 is affirmed at 'A+';
     -- Class B-3 is affirmed at 'BBB+';
     -- Class B-4 is affirmed at 'BBB-';
     -- Class B-5 is affirmed at 'B+'.

   * Merrill Lynch Mortgage Loans, Inc., mortgage pass-through
     certificates, series 2003-C

     -- Classes A-1 and A-2 are affirmed at 'AAA';
     -- Class B-1 is affirmed at 'AA+';
     -- Class B-2 is affirmed at 'A+';
     -- Class B-3 is affirmed at 'BBB+';
     -- Class B-4 is affirmed at 'BB+';
     -- Class B-5 is affirmed at 'B+'.

   * Merrill Lynch Mortgage Loans, Inc., mortgage pass-through
     certificates, series 2003-D

     -- Class A-1 is affirmed at 'AAA';
     -- Class B-1 is affirmed at 'AA+';
     -- Class B-2 is affirmed at 'A+';
     -- Class B-3 is affirmed at 'BBB+';
     -- Class B-4 is affirmed at 'BB+';
     -- Class B-5 is affirmed at 'B+'.

   * Merrill Lynch Mortgage Loans, Inc., mortgage pass-through
     certificates, series 2003-E

     -- Classes A-1 and A-2 are affirmed at 'AAA';
     -- Class B-1 is affirmed at 'AA+';
     -- Class B-2 is affirmed at 'A+';
     -- Class B-3 is affirmed at 'BBB+';
     -- Class B-4 is affirmed at 'BB+';
     -- Class B-5 is affirmed at 'B+'.

   * Merrill Lynch Mortgage Loans, Inc., mortgage pass-through
     certificates, series 2003-F

     -- Classes A-1, A-2 and A-3 are affirmed at 'AAA';
     -- Class B-1 is affirmed at 'AA+';
     -- Class B-2 is affirmed at 'A+';
     -- Class B-3 is affirmed at 'BBB';
     -- Class B-4 is affirmed at 'BB';
     -- Class B-5 is affirmed at 'B+'.

   * Merrill Lynch Mortgage Loans, Inc., mortgage pass-through
     certificates, series 2003-G

     -- Classes A-1, A-2, A-3 and A-4 are affirmed at 'AAA';
     -- Class B-1 is affirmed at 'AA+';
     -- Class B-2 is affirmed at 'A+';
     -- Class B-3 is affirmed at 'BBB+';
     -- Class B-4 is affirmed at 'BB+';
     -- Class B-5 is affirmed at 'B+'.

   * Merrill Lynch Mortgage Loans, Inc., mortgage pass-through
     certificates, series 2003-H

     -- Classes A-1, A-2 and A-3 are affirmed at 'AAA';
     -- Class B-1 is affirmed at 'AA+';
     -- Class B-2 is affirmed at 'A+';
     -- Class B-3 is affirmed at 'BBB+';
     -- Class B-4 is affirmed at 'BB+';
     -- Class B-5 is affirmed at 'B+'.

The upgrades reflect an increase in credit enhancement relative to
future loss expectations and represent approximately $10.9 million
of outstanding principal.

As of October 25, 2004, class B-3 of MLMI series 2000-3 has seen
an increase to 13.33% (from 0.60% at closing) in credit
enhancement provided by subordination from the nonrated class B-4.
In addition, the collateral pool has experienced no loan level
losses to date and current nonperforming loans are limited to the
30-day delinquency bucket.  Only 1% of the original mortgage pool
remains outstanding.

The current credit enhancement of MLMI series 2003-A1 classes M-1,
M-2, M-3, and B-1 is 4.34%, 2.61%, 1.59%, and 1.01% respectively.
Currently, 66% of the collateral has paid down.  Only 0.71% of the
current pool is delinquent.  There have been no losses to the
pool.  The collateral consists of conventional, first lien,
one- to four-family, 30-year adjustable-rate residential mortgage
loans.

The affirmations, representing approximately $7.6 billion of
outstanding principal, reflect credit enhancement consistent with
future loss expectations.  The pools are seasoned from a range of
10 to 21 months.  The pool factors (current principal balance as a
percentage of original) also range from approximately 58% to 91%
outstanding.


METROMEDIA INT'L: Talking to Investor Group about Proposed Merger
-----------------------------------------------------------------
Metromedia International Group, Inc. (Pink Sheets:MTRM) (Pink
Sheets:MTRMP), the owner of interests in various communications
businesses in Russia and the Republic of Georgia, has entered into
exclusive negotiations with an investor group composed of:

   -- Emergent Telecom Ventures,
   -- First National Holding,
   -- Capital International Private Equity Fund IV, L.P. and
   -- Baring Vostok Capital Partners (Cyprus) Limited

concerning the Investor Group's preliminary proposal to acquire
MIG by merger.

The Investor Group's proposal assigns an aggregate enterprise
value to MIG of $300 million.  Of this amount, approximately
$152 million would be used to retire the Company's outstanding
10-1/2% Senior Discount Notes Due 2007, and the remaining
$148 million, after reduction for certain transaction related
expenses, would be allocated between MIG's preferred and common
shareholders in a manner determined by the Company's Board prior
to the execution of any definitive merger agreement.  The proposal
contains a number of conditions, including without limitation:

   -- the Investor Group's successful completion of due diligence
      during a limited exclusivity period,

   -- the Investor Group obtaining commitments for all financing
      contemplated in its acquisition proposal,

   -- MIG meeting currently projected corporate cash balance and
      liability levels, and

   -- negotiation and execution of definitive transaction
      agreements.

MIG has granted the Investor Group exclusivity until January 17,
2005 to pursue a due diligence review of the Company and negotiate
a definitive merger agreement, subject to earlier termination
under certain circumstances.

The member companies of the Investor Group have come together
specifically for the purpose of acquiring MIG as a whole in the
proposed merger transaction.  Following successful conclusion of
such a transaction, Emergent and First National intend to take
direct ownership and pursue further development of MIG's ownership
interest in PeterStar; and Capital International and one or more
funds advised by Baring Vostok intend to take direct ownership and
pursue further development of MIG's current interests in the
Republic of Georgia.  Emergent /First National and Capital
International/Baring Vostok have each expressed their keen intent
to continue investment in Russia and the Republic of Georgia,
respectively.

With respect to these announcements, Mark Hauf, Chairman and CEO
of the Company, commented: "We have been actively assessing for
some time the practical business development and financial
restructuring alternatives available to the Company.  In this, our
consistent goal has been to best capture returns for our current
financial stakeholders from the extensive restructuring of our
business begun more than a year ago.  We have also received and
carefully considered several acquisition proposals from various
parties over recent months.  Based on the results of all this
work, the Board concluded that the Investor Group proposal, if
consummated, offers the best opportunity reasonably available to
maximize value for the Company's stakeholders.  We believe that
the proposed acquisition price reflects an attractive valuation
for our core businesses; and the Investor Group's willingness to
acquire the overall Company creates an efficient means to promptly
deliver this value to our current stakeholders.  It is also
important to note that the Investor Group's members command
considerable financial resources and possess substantial business
experience in the territories in which MIG now operates.  The
Investor Group's members have good working relationships with our
business partners in Russia and the Republic of Georgia, resulting
in no discount being taken in their offered price to account for
the otherwise inevitable partner risks common in these
territories.  In the Board's opinion, these factors lend
credibility to the Investor Group's proposal and maximize the
likelihood of successfully concluding a transaction."

There can be no assurances that any transaction with the Investor
Group or any other party will take place nor can any assurance be
given with respect to the timing or terms of any such transaction.
Details of the terms of a final agreement, if any, reached between
the parties will be disclosed upon signing of definitive
agreements.  The preliminary proposal made by the Investor Group
is non-binding and MIG has agreed, under certain circumstances, to
reimburse the Investor Group for a limited amount of its out-of-
pocket expenses incurred in connection with its due diligence
review and negotiation of definitive agreements.

               About the Members of the Investor Group

Baring Vostok Capital Partners

Baring Vostok Capital Partners is a leading private equity firm
investing in Russia and the CIS, with over US$ 400 million in
capital under management.  Baring Vostok has successfully invested
in a broad range of companies within the oil and gas, consumer
goods, manufacturing, telecommunications, financial services, mass
media and high-tech sectors.  Baring Vostok is an affiliate of
Baring Private Equity International, a $2 billion global private
equity group with activities in over 25 countries worldwide.

Capital International Private Equity Fund

Capital International Private Equity Fund IV, L.P. is one of four
private equity funds managed by Capital International, Inc. with,
collectively, aggregate capital commitments in excess of $1.4
billion.  CII, a subsidiary of The Capital Group Companies, Inc.,
is one of the largest and most experienced emerging markets
investment managers in the world with over $28 billion of assets
under management.

Emergent Telecom Ventures

Emergent Telecom Ventures is a communications merchant bank with
access to significant amounts of investment capital and a current
investment portfolio comprising more than 25 ventures.  Emergent
was founded by Juan Villalonga, former Chairman and CEO of
Telefonica, and Mohamed Amersi, co-founder of Gramercy
Communications Partners, which managed a $1.3 billion telecom
venture fund.  Other than investing for its own and investors'
accounts, Emergent provides advice to management of companies in
the technology, media and telecommunications sector and is active
in various other value-creating transactions in the sector.

First National Holding

First National Holding is a holding company incorporated in
Luxembourg.  First National owns a 58.9% stake in OAO
Telecominvest in Russia.  Through its investments, First National
is involved in a number of activities including wire line and
wireless telecommunications, financial services, IT and
outsourcing.  Investments of TCI include a 29% stake in PeterStar,
100% stake in PTT and a 31.3% stake in MegaFon, the third largest
GSM operator in Russia.

                  Evercore Partners Retention

In a separate filing, Metromedia reported that Evercore Partners
Inc. has been retained as the Company's financial advisor to
assist the Company's board of directors in its ongoing exploration
of strategic alternatives to maximize shareholder value, which may
include, but are not limited to, the possible sale of a portion or
all of the Company.  The completion of any extraordinary
transaction is highly uncertain.  No assurance can be given that
any such transaction will take place nor can any assurance be
given with respect to the timing or terms of any such transaction.

Given the status of the Company's ongoing review of its strategic
alternatives, the Company also announced that it will defer
convening an Annual Shareholders Meeting at this time.

               About Metromedia International Group

Through its wholly owned subsidiaries, the Company owns interests
in communications businesses in Russia and the Republic of
Georgia.  The Company has focused its principal attentions on the
continued development of these core telephony businesses, and has
substantially completed a program of gradual divestiture of its
former non-core cable television and radio broadcast businesses.
The Company's core telephony businesses include PeterStar, the
leading competitive local exchange carrier in St. Petersburg,
Russia, and Magticom, the leading mobile telephony operator in the
Republic of Georgia.

                     Balance Sheet Insolvency

At June 30, 2004, Metromedia International Group's balance sheet
showed an $11,469,000 stockholders' deficit, compared to a
$13,155,000 deficit at December 31, 2003.


METROPCS INC: Majority of Noteholders Consent to Limited Waiver
---------------------------------------------------------------
MetroPCS, Inc., has received and accepted consents from the
holders of a majority of its $150.0 million aggregate principal
amount of outstanding 10-3/4% Senior Notes due 2011 to a limited
waiver, for up to 180 days, of any default or event of default
arising from a failure by MetroPCS to file with the Securities and
Exchange Commission, and furnish to the holders of notes, reports
required to be filed pursuant to the Securities Exchange Act of
1934.

Bear, Stearns & Co. Inc. acted as the solicitation agent for the
consent solicitation.  Mellon Investor Services LLC acted as the
information and tabulation agent for the consent solicitation.
Information regarding the consent solicitation may be obtained by
contacting Bear, Stearns & Co. Inc., Global Liability Management
Group at (877) 696-BEAR (toll free) or (877) 696-2327 (toll free).

                      About MetroPCS, Inc.

Dallas-based MetroPCS, Inc. is a wholly owned subsidiary of
MetroPCS Communications, Inc. and a provider of wireless
communications services.  Through its subsidiaries, MetroPCS, Inc.
holds 20 PCS licenses in the greater Miami, Tampa, Sarasota, San
Francisco, Atlanta and Sacramento metropolitan areas.  MetroPCS
offers customers flat rate plans with unlimited anytime local and
long distance minutes with no contract.  MetroPCS is among the
first wireless operators to deploy an all-digital network based on
third generation infrastructure and handsets.  For more
information, visit the MetroPCS web site at
http://www.metropcs.com/

                          *     *     *

As reported in the Troubled Company Reporter on Oct. 13, 2004,
Standard & Poor's Ratings Services revised its outlook on Dallas,
Texas-based wireless service provider MetroPCS Inc. to negative
from positive.  The outlook revision reflects two concerns.

"First, the company is rapidly approaching the Nov. 8, 2004,
deadline for filing its second-quarter SEC Form 10-Q in order to
avoid triggering a technical default, which could result in
acceleration in repayment of about $150 million of 10.75% senior
notes due 2011.  Such acceleration could lead to a liquidity issue
in the near term," said Standard & Poor's credit analyst Michael
Tsao.

The delay in filing was caused by an ongoing internal
investigation into understatement of revenues and net income for
the quarter ended March 2004 (the accounting problem also caused
the withdrawal of a plan for an IPO).

Second, the accounting problem may be wider in scope than
initially expected by Standard & Poor's, given that the company
recently fired its principal accounting officer and announced that
previously issued financial statements for the years ended in
December 2002 and 2003 and subsequent interim period should not be
relied upon.  The accounting problem and any associated internal
control issue could lead to regulatory ramifications.


MID-AMERICAN MACHINE: Case Summary & Largest Unsecured Creditors
----------------------------------------------------------------
Debtor: Mid-American Machine Repair, Inc.
        P.O. Box 334
        Sharon, Tennessee 38255

Bankruptcy Case No.: 04-14946

Type of Business: The Debtor manufactures industrial equipments.

Chapter 11 Petition Date: November 3, 2004

Court: Western District of Tennessee (Jackson)

Judge: G. Harvey Boswell

Debtor's Counsel: Timothy B. Latimer, Esq.
                  Utley & Latimer, P.C.
                  425 East Baltimore
                  Jackson, TN 38301
                  Tel: 731-424-3315

Total Assets: $460,100

Total Debts:  $1,260,929

Debtor's 18 Largest Unsecured Creditors:

Entity                        Nature Of Claim       Claim Amount
------                        ---------------       ------------
Union Planters Bank           Building                  $429,842
P.O. Box 387                  Secured value:
Memphis, TN 38147             $287,900

Lynx Industrial Contractors,                            $212,201
LLC
1798 Old Frankfort Pike
Lexington, KY 40504

Goss Electrical Co., Inc.                               $136,310
137 Woodall Rd.
Decatur, AL 35601

Mid South Industrial, Inc.                               $65,685

O.A.S. Millwright Service                                $55,209

Norris Brothers Company                                  $30,352

NCA                                                      $22,893

Steel City, Inc.                                         $21,152

Diamond Heavy Haul, Inc.                                 $18,219

NES Rentals                                              $16,768

Platinum Plus for Business                               $15,786

Maxim Crane Works                                         $9,585

Flint Riggers & Erectors Inc.                             $9,000

Thompson Rental Co.                                       $8,603

Press Technology                                          $7,696

MSCO, Inc.                                                $5,699

Aida Dayton Technology                                    $4,287

ENCO Materials, Inc.                                      $4,082


MICROCELL TELECOM: Sept. 30 Balance Sheet Upside-Down by C$41.7MM
-----------------------------------------------------------------
Microcell Telecommunications Inc. (TSX: MT.A)(TSX: MT.B) reported
its consolidated financial and operating results for the third
quarter and nine months ended September 30, 2004.

Operating income before depreciation and amortization for the
third quarter of 2004 grew by 46% to $37.6 million from $25.7
million in 2003, despite $4.2 million in special charges incurred
for advisory fees related to the strategic review process that was
initiated by the Company to maximize value for its
securityholders, as well as for expenses arising from the
accelerated vesting of employee stock options. The significant
improvement was the result of a $29.2 million, or 20%, year-over-
year increase in total revenues, partially offset by a $17.4
million, or 14%, increase in total operating expenses before
depreciation and amortization. Total revenues for the third
quarter of 2004 amounted to $175.4 million, compared with $146.2
million for the same quarter in 2003, while total operating
expenses before depreciation and amortization were $137.8 million,
compared with $120.4 million.

"Our third-quarter results were shaped by strong subscriber growth
and rigorous expense management, resulting in solid operating
margin improvement," said Andre Tremblay, President and Chief
Executive Officer of Microcell Telecommunications Inc. "Not only
did we achieve record quarterly revenues and OIBDA, but we also
had our best non-fourth quarter ever in terms of gross subscriber
additions. The key catalysts for subscriber growth in the quarter
came from the favourable consumer response to our back-to-school
promotions that featured an attractive array of MMS-capable
handsets and other service options, many of which are exclusive to
Fido, as well as from the continuing positive impact of City Fido
in Vancouver and Toronto. Our third-quarter performance was
particularly gratifying given ongoing intense competitor activity.
More importantly, however, these operating results reflect our
continued focus on achieving profitable growth by pursuing a
postpaid-oriented market strategy that will positively impact
subscriber acquisition and customer mix, as well as accelerate
top-line growth."

"In the third quarter, we achieved good subscriber growth with a
substantial upturn in retail net additions," stated Jacques Leduc,
Chief Financial Officer and Treasurer of Microcell
Telecommunications Inc. "On a net basis, we added 75,773 new
subscribers in the third quarter of 2004, compared with 41,292 for
the same quarter last year and 16,652 in the previous quarter.
Gross subscriber additions, which escalated month by month during
the quarter, amounted to 179,532, reflecting a continuation of our
recent robust customer growth trend. More significantly, 70
percent of these gross additions were new postpaid subscribers,
reflecting the ongoing successful execution of our market
strategy. In fact, our postpaid subscriber base has increased by
41% since the third quarter of 2003. As a result, the proportion
of postpaid subscribers in our customer base has increased from
45% to 57%. This combined with seasonally strong ARPU of over $44
per month for retail subscribers contributed to a 20% improvement
in total revenues over the same period. Through double-digit
revenue growth and good cost control, we achieved an OIBDA of
$37.6 million for the third quarter, a result that nearly equals
the amount we generated for the first half of the year. As a
result of our operating performance for the first nine months of
the year, we remain on track to meet our previously stated targets
for full-year 2004."

On a year-to-date basis, total revenues amounted to $482.1
million, up 15% from $419.4 million for the first nine months of
2003, while total operating expenses before depreciation and
amortization increased to $401.4 million from $331.1 million. This
resulted in an OIBDA of $80.7 million for the first three quarters
of 2004, down from $88.2 million for the same period last year.
Despite the impact on operating expenses from the acquisition of
approximately 141,000 additional subscribers during the first nine
months of 2004 compared with the previous year, the decline in
OIBDA was due primarily to the incurrence of special charges
related to the takeover bid process in the amount of $9.7 million.

Primarily as a result of higher OIBDA, net income increased to
$2.9 million for the third quarter of 2004 from $1.3 million in
the previous year. Year-to-date, despite decreases in interest
expense as well as depreciation and amortization due to a sizeable
reduction in long-term debt and capital assets following the
implementation of its recapitalization plan on May 1, 2003, the
Company reported a net loss of $23.0 million, compared with net
income of $61.7 million for the same period in 2003. Net income
for the first nine months of 2003 arose mainly from a foreign
exchange gain of $148.7 million, compared with a foreign exchange
loss of $15.8 this year. The substantial foreign exchange gain
recorded in 2003 was attributable to the favourable impact of the
appreciation of the Canadian dollar against the U.S. dollar on a
significantly higher level of U.S.-dollar denominated debt
outstanding prior to the completion of the Company's capital
reorganization on May 1, 2003.

A detailed discussion and analysis of the financial results for
the third quarter is provided at the end of this news release in
the section entitled Management's Discussion and Analysis.
Operating and financial highlights for the third quarter included
the following:


   -- Retail gross activations totalled 179,532 for the third
      quarter of 2004, an increase of 35% compared with the
      132,521 subscribers activated during the same quarter in
      2003. Postpaid subscribers represented 70%, or 126,281, of
      the third-quarter retail gross activations, compared with
      43%, or 56,807, for the same quarter in 2003. Prepaid
      subscribers accounted for the remaining 30%, or 53,251,
      retail gross activations, down from 57%, or 75,714, in the
      third quarter of last year.

   -- The blended monthly churn rate in the third quarter
      increased to 2.8% from 2.6% in the corresponding quarter in
      2003. Although the postpaid churn rate increased to 2.5%
      from 2.0% in the third quarter of last year, it decreased
      sequentially from 2.6% in the second quarter of 2004.
      Similarly, the third-quarter prepaid churn rate also
      increased to 3.2% from 3.1% in the same quarter last year,
      but improved significantly compared with the previous
      quarter's rate of 4.5%.

   -- Net additions of 77,722 postpaid subscribers represented
      more than a five-fold increase compared with the 13,468
      postpaid net additions in the third quarter of 2003,
      reflecting a higher number of gross activations. Total
      prepaid subscribers decreased by 1,949 in the third quarter
      of 2004, compared with an increase of 27,824 customers in
      the same three-month period last year, reflecting the
      Company's continued emphasis and focus on the higher-value
      postpaid segment of the market. As a result, for the three
      months ended September 30, 2004, net additions equalled
      75,773 subscribers, bringing the total retail customer base
      to 1,275,094. As of the end of the third quarter of 2004,
      the Company also provided PCS network access to 52,265
      wholesale subscribers.

   -- Postpaid average monthly revenue per user (ARPU) increased
      to $64.43 from $63.88 in the third quarter of 2003,
      reflecting increased penetration of enhanced value-added
      services, continued growth of wireless data and roaming
      revenues, and fees associated with providing City Fido
      service. Prepaid ARPU for the third quarter of 2004
      decreased to $18.66 from $19.92 last year, due largely to
      the effect on airtime revenues from the introduction of a
      new price structure in August 2003 offering a $0.05 per-
      minute rate for evenings and weekends. As a result of higher
      postpaid ARPU in combination with a significantly greater
      proportion of postpaid subscribers in the retail customer
      base year-over-year, third-quarter blended ARPU increased to
      $44.24 from $39.98 last year.

   -- Due primarily to a larger number of gross activations, the
      retail cost of acquisition (COA) for the third quarter
      decreased to $215 per gross addition from $249 in 2003. This
      result was achieved despite a higher percentage of postpaid
      gross additions and higher variable costs related to sales
      and distribution.

   -- Microcell ended the third quarter of 2004 with $133.8
      million in cash, cash equivalents and short-term investment,
      compared with $177.7 million as at the end of the previous
      quarter. In addition, the Company had access to a $25.2
      million undrawn revolving credit facility (net of a $24.8
      million credit to cover swap exposure).

   -- Capital expenditures for the third quarter totalled $38.5
      million, compared with $20.1 million for the same period one
      year ago. The year-over-year increase in capital
      expenditures reflects higher spending for network access and
      capacity in line with subscriber and usage growth, as well
      as for the support of City Fido service in the Greater
      Vancouver and Greater Toronto Areas.

                      Corporate developments

   -- On September 20, 2004, we announced jointly with Rogers
      Wireless Communications Inc. and Rogers Communications Inc.
      the signing of a support agreement under which Rogers agreed
      to make offers to purchase our Class A Shares, Class B
      Shares for $35.00 per share, and our Warrants 2005 for
      $15.79 and Warrants 2008 for $15.01. The members of our
      board of directors have agreed that the Rogers offers are
      fair to our shareholders and in the best interests of
      Microcell. The board of directors of Microcell recommended
      to our shareholders to support the Rogers offers. The board
      of directors received opinions from its financial advisors,
      JP Morgan Securities Inc. and Rothschild, that the Rogers
      offers are fair, from a financial point of view, to our
      shareholders. The offers, which are subject to receipt of
      certain regulatory approvals and other customary conditions,
      are open for acceptance until 5:00 p.m., Eastern Standard
      Time, on November 5, 2004. The Directors' Circular relating
      to the Rogers offers has been sent to our securityholders on
      September 30,2004;

   -- Subsequent to the end of the third quarter on October 12,
      2004, TELUS Corporation announced that it would not extend
      its offers to purchase all of the issued and outstanding
      publicly traded shares   and warrants of Microcell initially
      made in May 2004;

   -- Microcell was added to the S&P/TSX Composite Index after the
      close of business on September 17, 2004. A market-weighted
      index of the largest Canadian incorporated public companies
      traded on the Toronto Stock Exchange, the S&P/TSX Composite
      Index is used to measure the price performance of the broad
      Canadian equity market;

   -- The Canadian Radio-television and Telecommunications
      Commission made a ruling under Decision 2004-46 to expand
      local interconnection regions and to rationalize the
      compensation rules between local exchange carriers. The
      ruling will enable Competitive Local Exchange Carriers to
      deploy fewer network points of interconnection, to further
      consolidate trunking facilities, and to offer local number
      portability across much wider areas. Microcell is the sole
      wireless carrier with CLEC status in Canada, and the only
      Canadian wireless operator currently offering number   
      portability;

   -- Industry Canada announced a decision rescinding the mobile
      spectrum cap policy, previously set at 55 MHz, which limited
      the amount of radio spectrum that cellular companies could
      hold;

   -- We signed a multi-year wholesale network services agreement
      with PRIMUS Telecommunications Canada Inc. ("PRIMUS"), the
      largest alternative communications provider in Canada,
      providing PRIMUS with access to our national PCS network as
      a Mobile Virtual Network Operator. The services are expected
      to be launched in fall 2004 by PRIMUS;

   -- On September 7, 2004, we launched a new $70 per month
      airtime package that allows for unlimited local calling, no
      long-distance charges on incoming calls, and 850 minutes of
      outgoing long distance within Canada and to the United
      States. We also introduced a new free interactive on-line
      service called Fido Showdown, which provides customers with
      a tool for comparing their current airtime package with
      Fido's line-up of services;

   -- During the quarter, we expanded our device portfolio with
      the introduction of five new wireless devices, including the
      Siemens CF62 and C65 handsets, the Sony Ericsson T610
      handset, the Nokia 3100 handset, and the Nokia N-Gage QD
      mobile game deck.

                      Results of operations

Three- and nine-month periods ended September 30, 2004, compared
with three- and nine-month periods ended September 30, 2003.

Operating results for our interim periods are not necessarily
indicative of the results that may be expected for the full year.
Specifically, during the fourth quarter, our operations are
subject to certain seasonal factors associated with subscriber
acquisition during the holiday period, which historically is the
largest acquisition period of the year for the wireless industry.
As a result, operating and net income during this period will be
affected by the cost of acquiring a proportionately higher number
of subscribers compared with each of the other three quarters of
the year. Except for the fact that some of our lenders may also be
some of our shareholders, we did not enter into any significant
related party transactions since our financial reorganization on
May 1, 2003.

During the third quarter of 2004, we had 179,532 gross
activations, an increase of 35% compared with the 132,521
activated during the same three-month period in 2003. The
significant year-over-year improvement in quarterly gross
activations was brought about by a substantial increase in
postpaid subscriber additions. This result can be explained by the
favourable consumer response towards our back-to-school promotions
that included an expanded array of new MMS-capable handsets, as
well as our new monthly service packages featuring unlimited local
calling anywhere in Canada and unlimited incoming calls. In
addition, the positive impact of our City Fido product in the
Greater Vancouver and Toronto Areas contributed significantly to
year-over-year growth in gross activations. As a result, postpaid
customers represented 126,281 of the total gross activations for
the third quarter of 2004, compared with the 56,807 achieved for
the same three-month period last year, while prepaid customers
accounted for the remaining 53,251 gross activations, down from
75,714 in the third quarter of 2003. The proportionately higher
percentage of gross postpaid activations in the third quarter of
2004 at 70%, compared with 43% in the previous year reflects our
increased focus on postpaid subscriber acquisition and the
attractiveness of our promotional monthly airtime packages, many
of which feature service options that are unique to Fido. On a
year-to-date basis for 2004, gross activations were 440,752 (made
up of 67% postpaid and 33% prepaid), an increase of 47% when
compared with 299,421 for the same period in 2003 (consisting of
38% postpaid and 62% prepaid). Our objective for 2004 is to
achieve a gross activation postpaid-to-prepaid split of
approximately 60% to 40%. The total number of new subscribers
acquired during the first nine months of 2004 represents over 65%
of the total expected gross activations for 2004, which is on
track with our plan for the full year.

The blended churn for the three and nine months ended September
30, 2004 was 2.8% and 3.0% respectively, compared with 2.6% and
3.1% for the same periods in 2003, due mainly to higher postpaid
churn.

Our postpaid churn for the three and nine months ended September
30, 2004 increased to 2.5% and 2.6%, respectively, from 2.0% and
2.1% for the same periods in 2003, primarily as a result of our
competitors' retaliatory marketing practices underscored by their
continuingly aggressive limited-time promotions launched mainly in
response to our launch of City Fido service in Toronto and
Vancouver. Although our postpaid churn rate increased year-over-
year, we experienced a slight improvement compared with the
previous quarter's result of 2.6%. We believe that the sequential
quarterly improvement in postpaid churn was mainly the result of
our customer lifecycle retention initiatives, the most significant
of which include a customer loyalty program that features
spending-based reward points and an optional two-year loyalty
agreement. Since we introduced long-term contracts in February
2004, approximately 66% of our new postpaid customers have chosen
this option. As a result of these programs, we expect a further
improvement in postpaid customer retention in future quarters.

Although our prepaid churn rate increased slightly to 3.2% in the
third quarter of 2004 from 3.1% in the same quarter one year
earlier, it decreased on a sequential basis from 4.5% in the
second quarter of 2004. The year-over-year increase in prepaid
churn for the third quarter was brought about by an increase in
inactive accounts due to our increased focus on acquiring higher-
value postpaid subscribers, resulting in a reduced number of new
activations with which to replenish the prepaid subscriber base.
Accordingly, for the first nine months of 2004, our prepaid churn
rate was 3.5%, compared with 3.8% for the same period in 2003.

At the beginning of the second quarter, we removed 74,843 inactive
prepaid customers from our retail subscriber base. The increase in
the number of inactive accounts was due primarily to the combined
impact of continuing aggressive actions by the competition to
attract our customers, a reduction in the validity period of
certain airtime vouchers, and the brief success of some of our
prepaid retention activities in 2003 that temporarily revived a
number of dormant prepaid accounts. The adjustment to the prepaid
customer base was not reflected in the calculation of our prepaid
and blended churn rates or in net additions as these operating
statistics are presented net of such adjustments.

Due to the combined impact of a significantly higher number of
gross activations and well-managed churn, we added 77,722 and
137,003 net retail postpaid customers in the three and nine months
ended September 30, 2004, respectively, compared with the net
addition of 13,468 postpaid customers in the third quarter of 2003
and the net loss of 27,997 in the first three quarters of last
year. These results were offset partially by the net loss of 1,949
and 32,212 prepaid customers for the third quarter and first nine
months of 2004, respectively. As a result, we added 75,773 new
retail customers in the third quarter of 2004 and 104,791 for the
first nine months of 2004, compared with the net addition of
41,292 and the net loss of 26,796 retail customers for the same
respective periods in 2003. Accordingly, as at September 30, 2004,
we provided wireless service to 1,275,094 retail PCS customers,
729,183 of which were on postpaid and 545,911 on prepaid, compared
with a retail customer base of 1,137,724 at the end of the third
quarter of 2003, which was composed of 517,064 postpaid
subscribers and 620,660 prepaid subscribers.

As at September 30, 2004, we also provided PCS network access to
52,265 wholesale subscribers, compared with 44,121 at the end of
the second quarter of 2004 and 22,712 at the end of the third
quarter of 2003. The increases were due mainly to Sprint Canada's
new combined home, long-distance and Fido wireless bundled service
offering introduced commercially in September 2003. In addition,
we had 429 subscribers on our iFido residential high-speed
Internet service at the end of the third quarter of 2004. This
service, which was commercially introduced in mid-March 2004, is
currently available in Richmond, British Columbia and Cumberland,
Ontario. We expect to offer iFido in our other markets as the MCS
network is deployed by the venture overseeing the development of
MCS broadband wireless access in Canada.

Our revenues consist primarily of retail PCS subscriber services
revenue, which is generated from monthly billings for access fees,
long distance, incremental airtime charges, prepaid time consumed
or expired, roaming, fees for value-added services, as well as
revenues from wholesale service providers.

Service revenues increased by 21% year-over-year to $163.7 million
for the third quarter of 2004 and by 13% year-over-year to $445.9
million for the nine months ended September 30, 2004. The $28.5
million year-over-year improvement in third-quarter service
revenues was composed of a $30.3 million increase in postpaid
revenues, resulting mainly from a higher average number of
postpaid subscribers in combination with higher postpaid ARPU, a
$3.7 million increase in roaming revenues, and a $0.7 million
increase in wholesale revenue. This was partially offset by a $6.2
million decrease in prepaid revenues arising from a reduction in
the number of active prepaid subscribers. Similarly, the $52.8
million increase in service revenues for the first nine months of
2004 compared with the same period in 2003 was composed of a $59.4
million increase in postpaid revenues, an $8.1 million improvement
in roaming revenues and a $0.6 million increase in wholesale
revenues, offset partially by a $15.3 million decrease in prepaid
revenues.

Equipment sales were $11.7 million and $36.2 million for the third
quarter and first nine months of 2004, respectively, compared with
$11.0 million and $26.3 million for the same periods in 2003.
Despite higher acquisition discounts from handset rebates on
limited-time promotions and an increase in customer retention-
related discounts, equipment sales improved year-over-year due
primarily to a higher number of handsets sold, resulting directly
from a significant increase in the number of gross activations.

Postpaid ARPU for the three and nine months ended September 30,
2004 increased to $64.43 and $61.72, respectively, from $63.88 and
$60.63 for the comparable periods in 2003. The improvements were
attributable mainly to increased value-added service revenue per
user from a higher penetration of enhanced voice services,
increased data-related revenue per user from the growth of
wireless data usage, the introduction of migration and management
fees as a result of the launch of City Fido, and higher roaming
revenues per user from a relatively greater level of both inbound
and outbound traffic. This was offset partially by lower extra
airtime revenue per user due to lower over-bundle usage stemming
from the migration of high-usage customers towards unlimited usage
options and plans such as Fido-to-Fido and City Fido, and
decreased long-distance usage per user. Average monthly usage by
our postpaid subscribers for the third quarter and year-to-date
2004 were 588 and 534 minutes, respectively, compared with 356 and
354 minutes for the same periods in 2003. The increases are
primarily the direct result of our new City Fido service in
Vancouver and Toronto that offers unlimited local usage for a
fixed price of $45 per month.

Prepaid ARPU for the third quarter of 2004 decreased to $18.66
from $19.92 last year. The decrease was due mainly to the effect
on airtime revenues from the introduction of a new price structure
in August 2003 offering a $0.05 per-minute rate for evenings and
weekends. Year-to-date, prepaid ARPU decreased to $17.63 from
$19.68 in 2003 primarily as a result of lower billable minutes of
usage in combination with the aforementioned impact on airtime
revenues from the new evenings and weekends price structure
introduced during the third quarter of 2003. Average monthly usage
by our prepaid customers for the three- and nine-month periods
ended September 30, 2004 was 63 and 59 minutes, respectively,
compared with 61 and 62 minutes in 2003.

Blended ARPU for the three and nine months ended September 30,
2004 increased to $44.24 and $40.60, respectively, compared with
$39.98 and $38.44 for the same periods last year due to the
combination of higher postpaid ARPU and a greater proportion of
postpaid subscribers in our customer base year-over-year.

Costs and operating expenses (excluding depreciation and
amortization) for the three- and nine-month periods ended
September 30, 2004 increased by 14% and 21%, respectively, to
$137.8 million and $401.4 million from $120.5 million and $331.1
million in 2003. The increases reflect the greater level of
subscriber acquisition, increased spending on retention and
customer service initiatives, as well as incremental costs
associated with a higher volume of roaming and long-distance
minutes. Accordingly, the year-over-year increase of $17.3 million
in third-quarter costs and operating expenses was composed of
higher cost of services of $7.7 million, higher selling and
marketing expenses of $6.6 million, higher general and
administrative expenses ("G&A") of $1.4 million and higher special
charges of $4.2 million, offset partially by lower cost of
products of $2.6 million. Similarly, year-to-date costs and
operating expenses were significantly higher in 2004 relative to
2003, due primarily to our resumption of full commercial
operations and subscriber growth starting in the third quarter of
2003, compared with previous quarters during the recapitalization
process that were characterized by a self-imposed growth slowdown
and careful cash management in order to preserve liquidity. As a
result, costs and operating expenses (excluding depreciation and
amortization) for the first nine months of 2004 increased by $70.3
million, compared with the same period in 2003. The increase in
year-to-date costs and operating expenses was due to higher cost
of services of $19.1 million, higher cost of products of $15.4
million, higher selling and marketing expenses of $24.6 million,
higher G&A of $1.5 million and higher special charges of $9.7
million.

Our cost of services for the third quarter increased to $53.3
million in 2004 from $45.6 million in 2003. The $7.7 million
variance was composed of a $2.6 million increase in customer care,
training and billing costs, a $1.9 million increase in network
operating costs, and a $3.2 million increase in the cost of sales
associated with providing long distance and roaming services.
Similarly, on a year-to-date basis, cost of services for the first
nine months of 2004 increased to $153.3 million from $134.2
million in 2003, due to a $9.7 million increase in customer care,
training and billing costs, a $1.7 million increase in network
operating costs, and a $7.9 million increase in variable cost of
sales, which was compensated for, in part, by a $0.2 million
reduction in contribution charges paid to the CRTC.

Our cost of products for the third quarter of 2004 was $26.4
million, down from $29.0 million for the third quarter of 2003.
The $2.6 million year-over-year decrease was due primarily to
lower prepaid voucher production costs of $1.9 million, and a
deferral of incremental costs of $8.9 million associated with our
24-month agreement handset discounts and City Fido activation fee.
These costs were partially offset by a higher volume of handsets
and accessories sold, resulting in an incremental expense of $7.4
million; increased per-unit handset costs for an aggregate amount
of $0.6 million, attributable to a higher cost mix of handsets
sold; and greater obsolescence and inventory devaluation for $0.2
million. For the nine-month period ended September 30, 2004, our
cost of products increased to $83.1 million from $67.7 million in
2003. The $15.4 million variance can be explained by: a higher
volume of handsets and accessories sold, resulting in an
incremental expense of $33.8 million; increased per-unit handset
costs for an aggregate amount of $4.7 million, attributable to a
higher cost mix of handsets sold; increased assembly, refurbishing
and packaging costs of $0.8 million; and greater obsolescence and
inventory devaluation of $4.0 million. These cost increases were
partially offset by a decrease in prepaid voucher production costs
of $5.6 million, and an expense deferral of $22.3 million,
associated with our 24-month agreement handset discounts and City
Fido activation fee.

For the three and nine months ended September 30, 2004, selling
and marketing expenses increased to $31.6 million and $87.8
million, respectively, from $25.0 million and $63.2 million for
the same periods in 2003. The higher costs incurred year-over-year
in the third quarter reflected an increase in retail partner
compensation due to a higher level of sales (particularly a higher
percentage of postpaid gross activations), increased spending on
advertising, a higher volume of promotional discounts, and
additional expenses associated with our new customer loyalty
program and on-going retention initiatives. On a year-to-date
basis, the higher costs recorded in 2004 were due mainly to
increased spending on marketing activities, promotions and sales
incentives, compared with the same period in 2003 when we reduced
our customer-acquisition related promotions, decreased sales
commissions and advertising expenses, as well as downsized our
direct sales force as part of our capital restructuring process.

As a result of a higher number of gross activations, and despite a
greater percentage of postpaid gross additions and higher variable
costs related to sales and distribution, our COA decreased to $215
per gross addition for the third quarter of 2004 and to $247 per
gross addition for the first nine months of 2004, compared with
$249 and $264 per gross addition for the same respective periods
in 2003.

We recorded G&A expenses of $22.3 million and $67.5 million for
the three and nine months ended September 30, 2004, respectively,
up from $20.9 million and $66.0 million for the same periods in
2003. The increases were due primarily to higher salaries and
benefits and higher bad debt expense brought about by an expansion
in accounts receivable, offset partially by lower rental,
insurance and maintenance costs.

In conjunction with the strategic review and financial
alternatives process that we initiated following the public
takeover offers in order to maximize value for our
securityholders, we incurred special charges in the amount of $3.8
million during the third quarter of 2004. This consisted of fees
for legal and financial consulting services. In addition, the
consequential impact of the offers on our share price led to an
accelerated vesting of shares under our employee stock option
plan, which resulted in an accelerated compensation expense of
$0.4 million during the quarter that we would have otherwise
recognized over the remaining initial vesting period. As a result,
the aggregate amount of special charges incurred in the third
quarter amounted to $4.2 million.

Depreciation and amortization increased to $23.3 million for the
three months ended September 30, 2004, compared with $17.5 million
for the same period in 2003 due to a notable increase in capital
expenditures over the past twelve months. Conversely, on a year-
to-date basis, despite higher capital spending for property, plant
and equipment, depreciation and amortization was lower at $61.1
million, compared with $88.2 million for the first nine months of
2003. The year-over-year decrease was due to the realignment of
our equity interest and capital structure under our
recapitalization plan that we were required to perform as at May
1, 2003. This comprehensive revaluation of our balance sheet,
referred to as "fresh start accounting," included an adjustment to
the historical carrying value of our assets and liabilities to
their fair values. As a result, and in order not to surpass the
fair value of the enterprise as a whole, the carrying value of our
property, plant and equipment was reduced from $602.1 million to
$289.7 million as at May 1, 2003.

Despite higher costs and expenses incurred from financing the
acquisition of approximately 47,000 additional subscribers during
the third quarter of 2004 compared with the same quarter last
year, we generated operating income of $14.4 million, compared
with $8.2 million in 2003. Similarly, on a year-to-date basis, we
generated $19.7 million of operating income, compared with $0.1
million for the first nine months of 2003. The improvement can be
explained primarily by the significant decrease in depreciation
and amortization expense following the reduction in property,
plant and equipment associated with fresh start accounting.

OIBDA for the third quarter of 2004 increased to $37.6 million
from $25.7 million in 2003. The improvement can be attributed to a
$29.2 million, or 20%, year-over-year increase in total revenues,
which was partially offset by a $17.3 million, or 14%, increase in
total costs and operating expenses before depreciation and
amortization. For the nine months ended September 30, 2004, OIBDA
was $80.7 million, down from $88.2 million in 2003. Despite the
impact on operating costs and expenses from the acquisition of
approximately 141,000 additional subscribers during the first
three quarters of this year, compared with the same period in
2003, the decrease in year-to-date OIBDA for 2004 was due
primarily to the incurrence of special charges in the amount of
$9.7 million in conjunction with the takeover bid process that
began this past May.

For the third quarter of 2004, net interest expense and financing
charges were $8.7 million, compared with $4.3 million for the same
quarter in 2003. The year-over-year quarterly increase was due to
an increase in the amount of long-term debt following the
refinancing of our post-recapitalization senior secured bank
credit facilities during the first quarter of 2004 coupled with a
higher effective interest rate. For the first nine months of 2004,
net interest expense and financing charges were $22.3 million,
down from $76.7 million for the same nine-month period in 2003.
This decrease was primarily the direct result of the reduction in
long-term debt following the implementation of our
recapitalization plan on May 1, 2003, and the appreciation of the
Canadian dollar relative to the U.S. dollar. Cash interest
payments of $8.8 million and debt principal repayments of $3.0
million were made during the third quarter of 2004.

We incurred a foreign exchange gain of $0.1 million for the third
quarter of 2004 (which includes an unrealized gain of $0.3
million), compared with a foreign exchange loss of $1.5 million
for the same quarter last year (of which $0.9 million was
unrealized). The improvement was due mainly to the relatively more
favourable change in the U.S./Canadian foreign exchange rate
compared in the third quarter of 2004 versus 2003. On a year-to-
date basis, we recorded a foreign exchange loss of $15.7 million
in 2004 (of which $13.0 million was unrealized), compared with a
foreign exchange gain of $148.8 million for the first nine months
of 2003 (of which $142.4 million was unrealized). The large
foreign exchange gain in 2003 was due to the relatively greater
positive impact of a favorable change in the U.S./Canadian foreign
exchange rate on a substantially higher level of U.S.-dollar
denominated long-term debt outstanding. Prior to the successful
completion of our capital reorganization, we had approximately
$1.9 billion of U.S.-dollar denominated long-term debt outstanding
as at April 30, 2003 compared with $360.6 million as at September
30, 2004. During the first quarter of 2004, we entered into swap
transactions to manage our exposure to foreign exchange rate
fluctuations on the U.S.-dollar-denominated term loan A debt
("Term Loan A") and term loan B debt ("Term Loan B") as explained
in the liquidity and capital resources section.

We recognized a share of net loss in investees of $0.8 million and
$1.7 million, respectively, for the three and nine months ended
September 30, 2004, as a result of Inukshuk's participation in a
venture which is currently in start-up mode. The venture, in which
we have a one-third ownership, was created with two other partners
during the fourth quarter of 2003 to build an MCS network in order
to offer high-speed Internet, IP-based voice and local networking
services to selected markets across Canada. Given our minority
interest in this venture, we account for its net losses using the
equity method of accounting.

Higher income tax expense of $0.8 million for the three-month
period ended September 30, 2004 is mainly due to a higher pre-tax
income incurred during the third quarter of 2004 compared with the
third quarter of 2003. On a year-to-date basis, lower income tax
expense of $7.8 million is mainly due to a lower pre-tax income
incurred during the first nine months of 2004 compared with the
same period of 2003.

We posted net income and net income applicable to Class A and
Class B Shares of $2.9 million for the third quarter of 2004. As a
result, basic and diluted earnings per share for the three months
ended September 30, 2004 were $0.10 and $0.08, respectively. This
compared with net income of $1.3 million and a net loss applicable
to Class A and Class B Shares (when considering the accretion on
the redemption price of the preferred shares) of $5.1 million for
the third quarter of 2003, as well as a basic and diluted loss per
share of $1.35. For the nine months ended September 30, 2004, we
recorded a net loss of $23.0 million and a net loss applicable to
Class A and Class B Shares (when considering the accretion on the
redemption price of the preferred shares for the first four months
of the year) of $28.2 million. Conversely, for the same nine-month
period in 2003, we recorded net income of $61.7 million (composed
of $45.5 million for the four-month pre-reorganization period and
$16.2 million for the five-month post-reorganization period) and
net income applicable to Class A and Class B Shares of $51.1
million (composed of $45.5 million for the four-month pre-
reorganization period and $5.6 million for the five-month post-
reorganization period). The net income we generated in 2003 was
mainly on account of a substantial foreign exchange gain recorded
on a relatively higher level of outstanding U.S.-dollar
denominated debt, which was offset partially by higher interest
expense and higher depreciation and amortization.

                Liquidity and Capital resources

As at September 30, 2004, we had cash and cash equivalents of
$111.0 million and short-term investments of $22.8 million
compared with $43.1 million and $60.9 million respectively, as at
December 31, 2003. Our cash and cash equivalents as at September
30, 2004 were composed of $108.0 million in Canadian dollars and
$3.0 million in U.S. dollars. In addition, we had access to a
revolving bank credit facility in the amount of $25.2 million
(after $24.8 million credit reduction following the swap
transactions entered into as described in note 5 to the unaudited
interim consolidated financial statements), of which no amount was
drawn on September 30, 2004. As at September 30, 2004, we had
outstanding letters of guarantee for an aggregate amount of $0.3
million.

As at September 30, 2004, we had outstanding amounts of $184.4
million as Term Loan A (US$146.2 million) and $188.2 million as
Term Loan B (US$149.2 million) for total borrowings of $372.6
million (including a current portion of $12.0 million). Without
taking into consideration the swap transactions described below,
Term Loan A bears interest at LIBOR plus 4%, which is payable on a
quarterly basis. The principal is payable in quarterly
installments, which started in June 2004 and will mature in March
2011. Term Loan B bears interest at LIBOR plus 7% (including a
LIBOR floor of 2%), which is payable on a quarterly basis. The
principal is also payable in quarterly installments, which started
in June 2004 and will mature in September 2011. We have the right
to increase, at a later date, up to an additional $25 million
under our revolving facility or Term Loan A and up to an
additional $50 million under Term Loan B. The credit facilities
are guaranteed by Microcell, and are secured by a pledge on
substantially all of our assets. In March 2004 we entered into
swap transactions to manage our exposure to foreign exchange rate
fluctuations on the U.S.-dollar denominated Term Loan A and Term
Loan B.

We swapped, in March 2004, the total principal of Term Loan A and
Term Loan B in the amount of $400 million (U.S.$299.9 million) at
a rate of 1.3340. We also swapped the floating interest rate of
LIBOR plus 4% on Term Loan A, payable in U.S. dollars, to a
floating interest rate of LIBOR plus 5.085%, payable in Canadian
dollars. We also swapped the floating interest rate of LIBOR plus
7% on Term Loan B, payable in U.S. dollars, to a floating interest
rate of LIBOR plus 8.485%, payable in Canadian dollars. These swap
agreements included a recouponing provision which allowed both
parties to enter into an amendment of the economic variables when
the fair market value of the swaps exceed a threshold of $16
million, in such manner that the market value is reduced to an
amount no greater than $16 million. As of September 30, 2004, an
amendment occurred between the parties to revise the limit of $16
million to $24.8 million. Consequently, the economic variables
were amended to reduce the market value of the swaps from $34.4
million payable to $24.7 million, generating a payment by us to
the counterparties of $9.7 million on October 3, 2004. Under this
amendment, the floating interest rates of our swap agreements
relating to our Term Loan A and Term Loan B were reduced to LIBOR
plus 4.616% and LIBOR plus 8.006% respectively. The maturity of
the swap transactions corresponds to the maturity of both term
loans. These swap transactions, which have not been designated as
hedging instruments, are presented at their fair value as
derivative instruments on the balance sheet and changes in fair
value are recognized in income as foreign exchange gains or
losses.

Pursuant to a final prospectus dated March 24, 2004, we
distributed to the holders of our Class A Shares, Class B Shares,
First Preferred Voting Shares, First Preferred Non-Voting Shares,
Second Preferred Voting Shares and Second Preferred Non-Voting
Shares, rights to subscribe for an aggregate of 4,519,636 Class B
Shares. Each five rights entitled the holder thereof to purchase
one Class B Share at a subscription price of $22 per share. In
connection with the rights offering, we entered into a standby
purchase agreement with COM Canada, LLC ("COM") pursuant to which
it agreed to purchase, at a price of $22.00, all Class B Shares
not otherwise purchased pursuant to the rights offering. In
addition, to the extent COM purchased less than $50 million of
such shares, it committed to purchase, at a price of $22.00,
additional Class B Shares having an aggregate subscription price
equal to the deficiency.

The closing of the rights offering occurred on April 30, 2004. The
rights offering resulted in the issuance by Microcell of 4,519,636
Class B Shares. On May 3, 2004, COM purchased, at a price of
$22.00 per share, 2,272,727 Class B Shares. Furthermore, Microcell
issued to COM, 3,977,272 warrants to acquire, at a price of $22.00
per share, additional Class B Shares. The net proceeds from the
rights offering and private placement to COM amounted to $148.0
million (net of approximately $1.4 million of issuance fees) and
have been used by Microcell to redeem as of May 1, 2004 75,233
preferred shares, at a price of $16.39 per share, for a total of
$1.2 million. The remaining balance of $146.8 million will be used
to fund capital expenditures and for general corporate purposes.

As a result of this rights offering and following the redemption
of our preferred shares and the exercise of 449,673 stock options,
our share capital as at September 30, 2004, was composed of the
following: 198,679 Class A Shares; 29,566,308 Class B Shares;
3,998,302 Warrants 2005; 6,663,943 Warrants 2008; and, 3,977,272
new warrants issued pursuant to the private placement. In
addition, there were 1,340,192 outstanding stock options for Class
B Non-Voting Shares.

Our working capital, or current assets less current liabilities,
was $137.1 million as at September 30, 2004 compared with $102.4
million as at December 31, 2003 for an increase of $34.7 million
mainly due to the net proceeds generated by the rights offering
and the bank financing described above.

            Three-month period ended September 30, 2004

We used $6.8 million in cash for our operating activities in the
three-month period ended September 30, 2004, compared with cash
provided by operating activities of $51.6 million for the same
period in 2003. The $58.4 million decrease resulted mainly from
higher cash used in operating assets and liabilities of $57.3
million and by higher cash expenses of $13.0 million, consisting
mainly of an increase in cash interest expense payable mainly due
to our new credit facilities and partially offset by a higher
operating income of $11.9 million (net of depreciation and
amortization).

Cash used in investing activities was $51.4 million during the
three-month period ended September 30, 2004, compared with $20.1
million for the same period in 2003. This increase was mainly
attributable to higher additions to property, plant and equipment
of $18.5 million in the third quarter of 2004 (resulting from
higher cash investments in the PCS network) and to higher
investment in short-term investments of $12.8 million. The year-
over-year increases in capital expenditures reflected an increase
in spending for network access and capacity expansion, as well as
the additional costs associated with our on-going support of City
Fido in Vancouver and Toronto, as well as preparing other cities
for the future launch of City Fido. The lower level of capital
spending in 2003 was due to our self-imposed growth slowdown
during the financial restructuring process in order to preserve
cash.

Cash provided by financing activities was $1.4 million for the
third quarter of 2004 compared with cash used totalling $2.4
million for the same period of 2003. This difference of $3.8
million was mainly due to the exercise of stock options in 2004
which generated proceeds of $4.7 million, partially offset by the
reimbursement of our long-term debt in the amount of $3.0 million
compared with a reimbursement of our long-term debt of $2.4
million in the third quarter of 2003.

            Nine-month period ended September 30, 2004

We generated $29.9 million in cash from our operating activities
in the nine-month period ended September 30, 2004, compared with
$75.3 million for the same period in 2003. The decrease of $45.4
million resulted mainly from lower cash provided by operating
assets and liabilities of $64.5 million and by a lower operating
income of $7.5 million (net of depreciation and amortization).
This was partially offset by lower cash expenses of $26.6 million,
consisting mainly of reduced cash interest expense due to our new
capital structure.

Cash used in investing activities was $160.0 million during the
nine-month period ended September 30, 2004, compared with cash
provided by investing activities of $49.6 million for the same
period in 2003. This was mainly attributable to higher additions
to property, plant and equipment which amounted to $198.2 million
in the first three quarters of 2004 compared with spending of
$36.1 million for the same period in 2003 and to lower proceeds
from the sale of long-term investment, short-term investments and
marketable securities of $47.5 million. The year-over-year
increases in capital expenditures reflected an increase in
spending for network access and capacity expansion, as well as the
additional costs associated with our on-going support of City Fido
in Vancouver and Toronto, as well as preparing other cities for
the future launch of City Fido. The increase in capacity-related
expenditures was the result of the timing of upgrades to our
switching and radio infrastructure and the initial set-up costs
associated with the expansion of City Fido beyond Vancouver and
Toronto. Network spending represented $167.6 million of total
capital expenditures for the nine-month period ended September 30,
2004. The remaining amounts were related primarily to information
technology initiatives and operational support systems.
Comparatively, the lower level of capital spending during the
first three quarters of 2003 was due to our self-imposed growth
slowdown during the capital restructuring process as a means of
preserving liquidity.

On March 17, 2004, we announced the successful closing of an
amended and restated senior secured bank financing in an aggregate
principal amount equivalent to $450 million (including undrawn
revolving credit facilities of $50 million) for our wholly-owned
subsidiary, Solutions. The proceeds have been used mainly to repay
borrowings under our previous senior secured credit facilities in
the amount of $330.3 million and to terminate related swap
transactions in the amount of $4.2 million. With respect to the
new credit facilities, we spent $12.9 million in financing costs,
which are deferred and amortized over the terms of the loans. In
addition, the rights offering, which was fully subscribed,
generated net proceeds of $148.0 million, excluding the use of
$1.2 million to redeem all of our outstanding preferred shares as
at April 30, 2004. Finally, the exercise of stock options
generated proceeds of $4.7 million. This was partially offset by
higher repayment of long-term debt in 2004 of $1.2 million. As a
result of the above, financing activities provided $198.0 million
of cash during the nine-month period ended September 30, 2004
compared with cash used of $4.8 million in 2003.

                          Contingencies

On April 21, 2004, Unique Broadband Wireless Services, Inc., an
Ontario corporation that manufactures and operates wireless
products and services, filed a lawsuit against Microcell,
Solutions, Inukshuk and Allstream Corp. in the Ontario Superior
Court of Justice. In its statement of claim, UBS claims, among
other things, for damages in the amount of $160 million from each
Microcell, Solutions and Inukshuk for breach of contract, breach
of confidence and breach of fiduciary duty and punitive damages.
UBS also claims from Inukshuk, as an alternative to the damages
claims, an order for specific performance of a conditional
agreement between Inukshuk and UBS with respect to the use of 38
MHz of Inukshuk's spectrum by UBS. UBS also claims certain other
equitable relief, including disgorgement of profits that UBS
alleges would otherwise unjustly enrich Inukshuk, Solutions and
Microcell. The action is at a very early stage with no statement
of defense yet delivered. Based on information currently
available, management considers that the companies have
substantive defenses to the action brought by UBS and intend to
vigorously defend the action.

On August 9, 2004, a proceeding under the Class Actions Act
(Saskatchewan) was brought against Microcell and other providers
of wireless telecommunications services in Canada. The proceeding
involves allegations of deceit, misrepresentation and false
advertising by wireless telecommunications service providers with
respect to the monthly system access fees being charged to
customers. The plaintiffs seek unquantified damages from the
defendant wireless telecommunications service providers, plus
costs and pre-judgment and post-judgment interest. Microcell
believes it has good defences to the allegations made by the
plaintiffs. Further, the proceeding has not been certified as a
class action and it is too early to determine whether the
proceeding will qualify for certification as a class action.

                        Guidance for 2004

We are changing our 2004 guidance for special charges from $15
million to $25 million. In conjunction with the takeover bid
offers that have emerged since May 2004, we have incurred special
charges related to both financial and legal fees. If a transaction
occurs, a transaction fee will be payable to our financial
advisors that will be calculated as a percentage of the
consideration paid to acquire Microcell's equity. As a result,
given the higher takeover bid price from Rogers of $35 per share,
compared with the unsolicited takeover offer of $29 per share from
TELUS Corporation which was used as the basis for establishing the
special charges provision of $15 million originally, we expect to
incur an additional $10 million in special charges. Consequently,
we now expect to generate an operating loss of up to $10 million
and OIBDA in the range of $90 million to $100 million. As
indicated in the table below, other previously issued guidance for
full-year 2004 financial and operating performance remains
unchanged.

                        About the Company

Microcell Telecommunications Inc. is a major provider, through its
subsidiaries, of telecommunications services in Canada dedicated
solely to wireless. Microcell offers a wide range of voice and
high-speed data communications products and services to over 1.2
million customers. Microcell operates a GSM network across Canada
and markets Personal Communications Services (PCS) and General
Packet Radio Service (GPRS) under the Fidor brand name. Microcell
has been a public company listed on the Toronto Stock Exchange
since October 15, 1997, and is a member of the S&P/TSX Composite
Index.

At Sept. 30, 2004, Microcell's balance sheet showed a C$41,655,000
stockholders' deficit, compared to a C$12,146,000 deficit at
Dec. 31, 2003.


MOLL AUTO SALES: Case Summary & 35 Largest Unsecured Creditors
--------------------------------------------------------------
Lead Debtor: Moll Auto Sales Company
             dba JD Byrider Sales
             1905 Gallatin Road North
             Madison, Tennessee 37115

Bankruptcy Case No.: 04-13315

Debtor affiliates filing separate chapter 11 petitions:

      Entity                                     Case No.
      ------                                     --------
      Moll Auto Finance Company                  04-13313

Type of Business: The Debtor is engaged in vehicle reconditioning
                  and sales.

Chapter 11 Petition Date: November 1, 2004

Court: Middle District of Tennessee (Nashville)

Judge: Keith M. Lundin

Debtors' Counsel: David Glendon Rogers, Esq.
                  703 Chadwick Drive, Suite 151
                  Brentwood, TN 37027
                  Tel: 615-377-7722
                  Fax: 615-377-7758

                                     Total Assets    Total Debts
                                     ------------    -----------
Moll Auto Sales Company                        $0     $4,325,052
Moll Auto Finance Company                      $0     $4,082,721

A. Moll Auto Sales Company's 20 Largest Unsecured Creditors:

Entity                                 Claim Amount
------                                 ------------
United Service Protection                $1,650,000
Serv. for The Assurance Group
23070 Network Place
Chicago IL 60673

TN Commerce Bank                         $1,200,000
381 Mallory Station Road
Suite 207
Franklin TN 37067

Community Business Finance               $1,200,000
PO Box 1390
Southaven MS 38671

Byrider Franchising, Inc.                   $35,549

NAPA Auto Parts                             $27,287

AmSouth Bank                                $20,000

Tennessee Dept of Revenue                   $18,457

First Choice Auto Sales                     $11,800

Capital One                                  $9,700

Bank One NA                                  $9,500

O'Reilly Automotive, Inc.                    $8,952

WZTV                                         $8,512

Premium Assignment Corp.                     $8,360

WUXP                                         $8,198

Johnisee & Sons                              $7,795

AIG                                          $7,215

Manchester LKQ Auto Parts                    $6,473

BlueCross/BlueShield of TN                   $5,814

American Tire Company                        $5,527

Kraft & Company                              $4,396

B. Moll Auto Finance Company's 15 Largest Unsecured Creditors:

Entity                                 Claim Amount
------                                 ------------
United Service Protection                $1,650,000
for the Assurance Group
23070 Network Place

TN Commerce Bank                         $1,200,000
381 Mallory Station Road
Suite 207
Franklin TN 37067

National Recovery Bureau                     $5,095

Kraft & Company                              $3,494

Kirk C. Waite, Attorney                      $1,630

Bankers Systems Inc.                           $983

Vernon A. Melton, Jr. Esq.                     $500

Pitney Bowes Credit Corp.                      $229

Paychex                                        $160

Trans Union LLC                                $158

CSC Credit Services                            $135

Tennessee Motor Vehicle                        $105

Charles Veach                                   $99

Performance Business Forms                      $68

Pitney Bowes                                    $65


MORTGAGE ASSET: Fitch Places Low-B Ratings on Four Cert. Classes
----------------------------------------------------------------
Fitch Ratings affirmed 40 classes of Mortgage Asset Securitization
Transactions, Inc. residential mortgage-backed certificates, as
follows:

   * Mortgage Asset Securitization Transactions Alternative Loan
     Trust, Inc., mortgage pass-through certificates, series
     2003-1:

     -- Classes 1-A, 2-A, 3-A, 4-A, and 5-A affirmed at 'AAA';
     -- Class B-1 affirmed at 'AA';
     -- Class B-2 affirmed at 'A';
     -- Class B-3 affirmed at 'BBB';
     -- Class B-4 affirmed at 'BB';
     -- Class B-5 affirmed at 'B'.

   * Mortgage Asset Securitization Transactions Alternative Loan
     Trust, Inc., mortgage pass-through certificates, series
     2003-4

     -- Classes 1-A, 2-A, 3-A, 4-A, and 5-A affirmed at 'AAA';
     -- Class B-1 affirmed at 'AA-';
     -- Class B-2 affirmed at 'A-';
     -- Class B-4 affirmed at 'BB-'.

   * Mortgage Asset Securitization Transactions Alternative Loan
     Trust, Inc., mortgage pass-through certificates, series
     2003-7

     -- Classes 1-A, 2-A, 3-A, 4-A, 5-A, 6-A, 7-A, and 8-A
        affirmed at 'AAA';
     -- Class B-2 Affirmed at 'A-';
     -- Class B-3 Affirmed at 'BBB-'.

   * Mortgage Asset Securitization Transactions Alternative Loan
     Trust, Inc., Mortgage Pass-Through Certificates, Series
     2003-9

     -- Classes 1-A, 2-A, 3-A, 4-A, 5-A, 6-A, 7-A, 8-A affirmed at
        'AAA'
     -- Class B-1 affirmed at 'AA-';
     -- Class B-2 affirmed at 'A-';
     -- Class B-3 affirmed at 'BBB';
     -- Class B-4 affirmed at 'BB-'.

These affirmations, representing approximately $1.4 billion of
outstanding principal, reflect credit enhancement consistent with
future loss expectations.  The pools are seasoned from a range of
10 to 21 months.  The pool factors (current principal balance as a
percentage of original) range from approximately 43% to 86%
outstanding.

The underlying collateral for all the transactions consists of
conventional, fully amortizing 15- to 30-year fixed-rate mortgage
loans secured by first liens on one- to four-family residential
properties.


NAPIER ENVIRONMENTAL: Weak Financials Spur Restructuring Plans
--------------------------------------------------------------
Napier Environmental Technologies Inc. reported plans to make a
restructuring proposal to the company's creditors. Napier has
experienced losses over many years in seeking to expand markets
for the company's products. Weaker than anticipated sales
conditions in the third quarter and a seasonal slowdown in the
current quarter have further eroded the company's financial
position, and it now has insufficient financial resources to meet
all of its existing creditor obligations. The company has filed a
Notice of Intention to Make a Proposal under the Bankruptcy and
Insolvency Act. This will facilitate an orderly evaluation of
alternatives to strengthen the company's business model and
capital structure.

The Notice of Intention filing allows Napier to maintain
operations while completing necessary changes to improve its
business and develop a restructuring proposal for creditors.
During this period Campbell Saunders Ltd., an experienced Trustee,
will monitor the activities of the Company and assist it in
formulating a proposal to its creditors.

In conjunction with the filing, Napier has engaged Wayne J.
Henderson to lead the company on an interim basis as Chief
Restructuring Officer. Mr. Henderson has been a member of the
company's Board of Directors since July 2004 and is a corporate
advisor. He has previously held executive positions in corporate
and investment banking with a major Canadian financial
institution. President and Chief Executive Officer, Frank Dixon,
has resigned from the company and its Board of Directors. He will
remain available to the company on a consulting basis during a
transition period.

"The company will continue to operate while we complete the
restructuring process," said company Chairman, Lionel Dodd. "The
ongoing support of our customers, employees and suppliers will
help ensure we can restructure to the benefit of all stakeholders.
We are very fortunate to have Wayne's leadership at this very
challenging time," he said. The company's secured lender has
agreed to continue to provide advances under existing Financing
Facilities while the company completes its restructuring.

The company will be working to refine its business model - with a
greater focus on existing core technology, products and customers,
and a significant reduction in SG&A costs. The objective will be
to move forward with a solid plan that leverages the proven
effectiveness of its products and the validation of some of the
world's leading coating and home improvement companies. This will
be accomplished through a strategic review process over the next
100 days. Additional financing or investment may be required
during the period to ensure that the company can complete the
restructuring process.

There can be no assurance that the company will successfully
emerge from its reorganization proceedings. Approval of a Plan and
emergence from reorganization proceedings are subject to a number
of conditions.

                        About the Company

Napier Environmental Technologies manufactures environmentally
safer wood treatments and paint removal products for commercial
and consumer markets.


NATIONAL ENERGY: ET Holdings Objects to Adam Mirick's $2.5M Claim
-----------------------------------------------------------------
Adam Mirick was an energy trader employed by NEGT Energy Trading
Holdings Corporation f/k/a PG&E Energy Trading Holdings
Corporation.  Mr. Mirick's employment with ET Holdings was
terminated on March 14, 2003.  Mr. Mirick filed Claim No. 77
against ET Holdings for $7,859,478.

Prior to the Petition Date, Mr. Mirick filed a complaint against
ET Holdings in the Circuit Court for Montgomery County for
damages and other relief.  ET Holdings asserted defenses.

Mr. Mirick contends that he is entitled to $113,390 as
compensation for work performed in 2001 and $2,502,261 as
compensation for work done in 2002.  In addition, Mr. Mirick
seeks treble damages and attorney's fees pursuant to the Maryland
Wage Payment and Collection Act.

ET Holdings asks Judge Mannes to reduce and allow the Mirick
Claim as a general unsecured non-priority claim for $111,467.

ET Holdings asserts that Mr. Mirick's Claim fails to provide
support for the alleged basis of his claim.

For the year 2001, ET Holdings made a discretionary supplemental
incentive award to Mr. Mirick amounting to $715,000.  Pursuant to
its supplemental incentive award payment structure, ET Holdings
paid Mr. Mirick $500,000 in March 2002, and $109,130 -- $107,500
plus $1,630 interest -- in October 2002.  ET Holdings did not pay
to Mr. Mirick the $111,467 remaining deferred amount -- $107,500
plus $3,967 interest -- which was due in October 2003 for his
year 2001 supplemental incentive award.  ET Holdings concedes
that Mr. Mirick is owed that amount.

Mr. Mirick also claims that he is owed $2,500,000 as a
supplemental incentive award for the year 2002.  Because
supplemental incentive awards were discretionary and ET Holdings
never awarded any supplemental incentive awards to Mr. Mirick or
any of the other energy traders for 2002, ET Holdings objects to
Mr. Mirick's claims based on a purported supplemental incentive
award for that year.

Because all supplemental incentive awards were discretionary in
nature, the Maryland Wage Payment and Collection Act is
inapplicable to Mr. Mirick's claims.  Therefore, ET Holdings
objects to the "treble damages" and attorney's fees, which Mr.
Mirick seeks.  Moreover, as the automatic stay prohibits ET
Holdings from paying Mr. Mirick's prepetition claims, the
Maryland Wage Payment and Collection Act is inapplicable as a
matter of bankruptcy law.

Headquartered in Bethesda, Maryland, PG&E National Energy Group,
Inc. -- http://www.pge.com/-- (n/k/a National Energy & Gas  
Transmission, Inc.) develops, builds, owns and operates electric
generating and natural gas pipeline facilities and provides energy
trading, marketing and risk-management services.  The Company
filed for Chapter 11 protection on July 8, 2003 (Bankr. D. Md.
Case No. 03-30459).  Matthew A. Feldman, Esq., Shelley C. Chapman,
Esq., and Carollynn H.G. Callari, Esq., at Willkie Farr &
Gallagher represent the Debtors in their restructuring efforts.  
When the Company filed for protection from its creditors, it
listed $7,613,000,000 in assets and $9,062,000,000 in debts. NEGT
received bankruptcy court approval of its reorganization plan in
May 2004, and emerged from bankruptcy on Oct. 29, 2004. (PG&E
National Bankruptcy News, Issue No. 27; Bankruptcy Creditors'
Service, Inc., 215/945-7000)


NETWORK INSTALLATION: Wins Wireless Project Order from ACON Labs
----------------------------------------------------------------
Network Installation Corp. (OTC Bulletin Board: NWKI) received a
project order from medical diagnostics provider ACON Laboratories.
The project includes the installation and deployment of a Strix
Systems wireless network between campus buildings. The project
maintains future scalability for indoor Wi-Fi coverage.

                 About Network Installation Corp.
  
Network Installation Corp. provides communications solutions to
the Fortune 1000, Government Agencies, Municipalities, K-12 and
Universities and Multiple Property Owners. These solutions include
the design, installation and deployment of data, voice and video
networks as well as wireless networks and Wi-Fi. Through its
wholly-owned subsidiary Del Mar Systems International, Inc., the
Company also provides integrated telecommunications solutions
including Voice over Internet Protocol (VoIP) applications. To
find out more about Network Installation Corp. (OTC Bulletin
Board: NWKI), visit our corporate website at
http://www.networkinstallationcorp.net/or  
http://www.delmarsystems.com/The Company's public financial  
information and filings can be viewed at http://www.sec.gov/

                          *     *     *

                       Going Concern Doubt  

In its Form 10-QSB for the quarterly period ended June 30, 2004,  
filed with the Securities and Exchange Commission, Network  
Installation Corporation reports that it has accumulated deficit  
of $6,576,914, is generating losses from operations, and has a  
negative cash flow from operations. The continuing losses have  
adversely affected the liquidity of the Company. The Company faces  
continuing significant business risks, including but, not limited  
to, its ability to maintain vendor and supplier relationships by  
making timely payments when due.


NEXTWAVE TELECOM: Selling All PCS Licenses to Verizon for $3 Bil.
-----------------------------------------------------------------
NextWave Telecom Inc. has asked the bankruptcy court administering
the Company's Chapter 11 proceedings for authority to sell all its
PCS licenses to Verizon Wireless as part of a forthcoming plan of
reorganization. Under that plan, Verizon Wireless would acquire
all the shares of NextWave entities that hold or control such
licenses, and all of NextWave's liabilities and other assets would
be consolidated into a new operating company that would be spun-
out to shareholders to pursue broadband wireless market
opportunities following confirmation of the plan.

"We're very pleased to present the court with a transaction that
will create significant value for the estates and enable the
Company to complete its reorganization successfully," said Allen
Salmasi, NextWave's Chairman and CEO. "The acquisition agreement
with Verizon Wireless represents the best available transaction
with respect to our PCS spectrum assets for the benefit of all our
stakeholders. The plan we intend to file is not the end of
NextWave, it's a new beginning. The Company looks forward to
continue developing the promising opportunities generated by the
broadband wireless activities we have undertaken in recent years."

The acquisition agreement is one of two principal parts of a plan
of reorganization that will be filed in the near future, and which
will provide full payment to all creditors of the estates:

    * Under the agreement:

      (1) aggregate consideration of $3 billion will be paid in
          cash;

      (2) approximately $165 million of that amount will be placed
          in escrow for the benefit of Verizon Wireless or the new
          operating company, depending on the resolution of
          certain tax issues; and

      (3) Verizon Wireless will acquire the shares of NextWave
          Telecom Inc. and its licensing subsidiaries, which will
          have no liabilities and no assets other than the
          Company's PCS licenses, free and clear of all       
          encumbrances.  The agreement also provides for a breakup
          fee of 3% of the purchase price if the agreement is
          terminated under certain circumstances.

    * The plan will provide for an internal corporate
      restructuring that will consolidate all the Company's
      liabilities and remaining assets -- including MMDS spectrum
      holdings and Tele*Code, an existing non-debtor subsidiary of
      NextWave -- into a newly formed operating company, through
      which NextWave intends to develop, build and operate
      broadband wireless networks designed to provide both high-
      speed fixed/mobile Internet access and VoIP services.  Such
      access and services will deliver broadband connectivity that
      is affordable, mobile, and accessible from home gateway
      units, desktop PCs, smartphones, PDAs, and other handheld
      devices.

The plan also will provide for an additional payment to the
Federal Communications Commission of approximately $71 million,
plus any other amounts owed the government under the terms of an
April 2004 Global Resolution Agreement between NextWave and the
FCC. The Global Resolution Agreement resolved all claims between
the Company and the agency, including auction-related financial
obligations associated with NextWave's PCS licenses.

Upon confirmation, all creditors will be paid in full and existing
NextWave shareholders will receive a distribution of cash and
interests in the newly formed operating company. A portion of the
acquisition price and/or existing cash will be utilized to
establish appropriate reserves for contingent liabilities and
expenses related to the conclusion of the bankruptcy proceedings,
and to provide funding for obligations assumed by the newly formed
operating company and for its future operations.

"Following our settlement with the FCC," said Mr. Salmasi, "over
the past six months we have evaluated every potential option for
our remaining PCS licenses, ranging from a complete build-out to
mergers and acquisitions. It became clear to us that the most
prudent course of action is the one currently being pursued, given
the level of maturity, and the scale and scope, that the major
wireless carriers have achieved with their PCS networks and
distribution channels. We believe this transaction provides the
greatest value and certainty for our stakeholders."

A hearing on NextWave's request for bankruptcy court approval of
the acquisition agreement will be held before the court in White
Plains, New York, on November 30, 2004, at 11 AM. In addition to
bankruptcy court approval, the transaction also will be subject to
FCC approval and antitrust regulatory review. The transaction
would close after those approvals are secured and confirmation of
the Company's plan of reorganization, which will be filed in the
coming weeks.

                      About Verizon Wireless

Verizon Wireless owns and operates the nation's most reliable
wireless network, serving 42.1 million voice and data customers.
Headquartered in Bedminster, New Jersey, Verizon Wireless is a
joint venture of Verizon Communications (NYSE: VZ) and Vodafone
(NYSE and LSE: VOD). Find more information on the Web at
http://www.verizonwireless.com/To receive broadcast-quality
video footage of Verizon Wireless operations, log onto
http://www.thenewsmarket.com/verizonwireless/

                       About NextWave Telecom

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


NORTHERN KENTUCKY: Baseball Franchise Gets $3 Million Bid
---------------------------------------------------------
Canterbury Baseball, LLC -- an investor group headed by Clint
Brown, a retired Edgewood, Ky., business executive -- has put
together an approximate $3 million offer to buy the troubled
Florence Freedom minor league baseball franchise.

Subject to higher and better offers, Northern Kentucky
Professional Baseball, LLC, will sell substantially all of its
assets to Canterbury and assume some stadium construction and
other contracts.  

                       Competing Bids

Competing bidders, if any, must contact the core professionals
in the Debtor's chapter 11 case by Nov. 29 and make a $75,000
deposit.  Bids must be submitted by Dec. 3 and must top
Canterbury's offer by $90,000.  An auction, if necessary, will
be held on Dec. 8, and bidding will be in $75,000 increments.  
Objections to the sale, if any, must be filed and served by
Dec. 10.  The Debtors will ask the Court to ratify and approve the
sale to the highest bidder on Dec. 14  In the event Canterbury's
bid it upset by a competitor, Canterbury is entitled to a $70,000
break-up fee.  

                       Key Documents

A copy of the Asset Purchase Agreement between Canterbury and the
Debtor is available at no charge at:

   http://bankrupt.com/misc/04-22256-0087-A.pdf

A copy of the applicable Bidding Procedures Order is available at
no charge at:

   http://bankrupt.com/misc/04-22256-0105.pdf

A copy of the Debtor's Sale Motion is available at no charge at:

   http://bankrupt.com/misc/04-22256-0087.pdf

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 Debtor in its restructuring, and Richard G.
Hardy, Esq., and Reuel D. Ash, Esq., at Ulmer & Berne LLP,
represent the Official Committee of Unsecured Creditors.  When the
Debtor filed for protection from its creditors, it listed
$9,353,870 in total assets and $9,485,394 in total debts.


PACIFIC GAS: Saybrook Details Hand in Bankruptcy Emergence
----------------------------------------------------------
When the lights went out in California, no one was quite sure how
to get them back on. Three years later, Saybrook's financial
advisory success with Pacific Gas and Electric speaks for itself.
Saybrook served as investment banker and financial advisor to the
Official Committee of Creditors. Creditors achieved a 100%
recovery and California's lights are back on.

Saybrook's expertise was demonstrated as it helped craft a
restructuring plan alternative to management's plan and
successfully negotiated its implementation. Defying convention,
creditors' recovery actually increased by over $4 billion during
Saybrook's engagement and shareholders value increased by more
than $8 billion.

"By emerging as a financially healthy company, we are on a solid
foundation to continue investing in the infrastructure that
delivers energy to our customers, and serves as the backbone of
our state's economy," said Gordon R. Smith, PG&E's President and
CEO. "We will also be able to re-engage with the communities we
serve, and return to the traditional roles we played with them,
which were temporarily interrupted by the challenges of the energy
crisis."

Jonathan Rosenthal, a partner of Saybrook who led the engagement
team, said, "Shareholders received the immediate benefit of
investment grade status, stable operations and a strong capital
structure, all resulting in a higher share price with dividends
projected within one year. Saybrook helped the utility to emerge
from bankruptcy in 3 years versus 5 to 7 years of other utility
bankruptcies. Unsecured debt went from a market trading price of
$.55 to $1.06 and its share went from $6.00 to $28.00."

PG&E filed for reorganization under Chapter 11 of the U.S.
Bankruptcy Code on April 6, 2001. Three years later, the
resolution and emergence from Chapter 11 -- supported by the
company, its creditors, the California Public Utilities Commission
(CPUC), labor, and environmental and consumer groups -- has
restored the utility's investment grade credit ratings, satisfied
all valid creditor claims, and provided the basis for a
substantial reduction in electric rates with the potential for
additional savings to customers in the future.

                         About Saybrook
   
Saybrook is an investment bank engaged in financial advisory
services and capital management. To its advisory practice Saybrook
brings an unusual blend of knowledge and experience in areas that
include corporate restructurings, public and private real estate
finance and municipal finance. Saybrook has played a key role in 5
of the 14 largest bankruptcies in U.S. history, including, United
Airlines, WorldCom, Kmart, Adelphia and, most recently, PG&E. In
addition, Saybrook served as advisors to the investors on the
record breaking Orange County, CA, municipal bankruptcy. To find
out more about Saybrook, please visit http://www.saybrook.net/

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.


PAMET SYSTEMS: Sept. 30 Balance Sheet Upside-Down by $6.3 Million
-----------------------------------------------------------------
Pamet Systems, Inc. (OTC: PAMT), a provider of information systems
and technologies for public safety and homeland security,
announced an open letter from its Chairman to its shareholders
accompanied by an update on recent results.

   Dear Fellow Shareholders:

   As we approach the Special Meeting of Shareholders on
   Wednesday, November 17, 2004, I would like to take this
   opportunity to thank all of you for your support and patience
   over the past several years. Last January the Board decided to
   deregister Pamet Systems, Inc. as a public company for two good
   reasons:

      -- to improve the Company's bottom line by eliminating
         the substantial and growing expense of being a public
         company and

      -- to eliminate the reporting requirements that were giving
         our non-public company competitors an advantage against
         us.

   The trade-off was that we would be somewhat restricted in our
   ability to report our progress to our shareholders. The
   discussion of our results that follows should address this
   issue for now. Again -- thank you for your patience and
   understanding as we have worked through the task of
   strengthening Pamet's position over the last several years.

   At the November 17th Special Meeting of Shareholders there will
   be a vote taken on the election of directors and three other
   proposals -- chief among them a proposal to conduct a 1:10
   reverse split of our outstanding shares. If you have received
   your proxy, we would urge you to read through the proposals and
   we would ask that you support Management in voting FOR each of
   the proposals. If you have not yet received your proxy, please
   contact the Company immediately so we can make sure you do
   receive a copy. You may also contact us if you require
   explanations for any of the proposals in the proxy. The correct
   person to call in either case is Kirke Curtis at 978-263-2060
   x223.

   Sincerely,

   Bruce J. Rogow
   Chairman
   Pamet Systems, Inc.

                        Report on Results

                            Overview

Pamet Systems, Inc., founded in 1987, designs and implements
broad-based information technology solutions for public safety and
criminal justice agencies enabling them to realize cost
efficiencies and to provide better service to the public. The
foundation of the Company's integrated suite of products is
composed of three core components: PoliceServer, FireServer, and
CADServer. The Company also offers several companion products
including Advanced Imaging, Mobile Access and Advanced Reporting,
that are integrated with the police and fire records management
and computer-aided dispatch modules. The Company's revenues
consist primarily of sales of these software applications, annual
support and maintenance service fees, fees associated with
migrating clients from the Company's legacy VMS-based products to
their Windows-based products and occasional revenue associated
with hardware, systems integration and the resale of third-party
software products.

During the calendar year 2003 and during the 2004 period, the
Company was awarded business from several new agencies including
the Blue Ash, Ohio Police Department, the Utica, New York Fire
Department, the Essex County, New Jersey Sheriff's Office and the
Norfolk, Massachusetts Fire Department. The Company also received
additional revenue from several existing clients for add-on
products, additional user-licenses and as progress payments
against implementations that were started in earlier periods
(e.g., from Utica, NY, and the Milwaukee County, WI Sheriff's
Office). Finally, the Company also realized revenue from over
twenty clients of the Company's legacy VMS-based product for
services related to migrating to Pamet's Windows-based product.
Despite the Company's success in several competitive bidding
processes and in migrating a substantial number of its clients to
Windows in 2003 and 2004, Pamet has also experienced the defection
of a small number of VMS-based customers moving to other vendors'
Windows applications for a variety of reasons such as price, ease
of use considerations and differences in functionality. To date,
86% of Pamet's installed customers are now on the Window's-based
product, with migrations in progress for another 6%. With so few
legacy customers left, the Company anticipates very few additional
defections.

The primary challenges that the Company focused on during the 2003
and 2004 periods were:

   1) establishing and maintaining the Company's operating
      profit,

   2) continuing migrations from legacy customers and

   3) growing the Company's revenues in a climate of reduced state
      and municipal spending and grant money and with very meager
      sales and marketing resources.

With regards to establishing and maintaining the Company's
operating profit, the Company was able to generate an operating
profit for the 2004 period of $91,633 compared to the 2003 period
operating loss of ($186,246). Unaudited results for Q3 and Q4 of
2003 and Q1, Q2 and Q3 of 2004 show an operating profit for each
of these five quarters. In short, the Company has produced five
consecutive quarters of EBITDA-positive results. Due to the
accrual of interest on the Company's convertible promissory notes,
however, the actual net income or net loss for those periods was
as follows: ($53,216) for Q3 2003, ($67,184) for Q4 2003, $271 for
Q1 2004, ($26,237) for Q2 2004 and ($68,546) for Q3 2004.

The Company has also had success in migrating its legacy VMS
customers over to its Windows product suite. These migrations
resulted in modest one-time revenue for the migration, in
typically higher support fees in subsequent years and in a higher
likelihood of short- and medium-term customer retention.

Growing the Company's revenues continues to be a constant
challenge given the fact that the Company does not yet have any
full-time sales or marketing resources and revenue from migrations
is gradually diminishing. The Company's unaudited revenues for the
9-month period ended September 30, 2004 decreased 7.3% to
$1,126,516 from the unaudited figure of $1,187,021 for the 9-month
period ended September 30, 2003. Management believes that until
the Company has the working capital necessary to ramp-up full-time
sales and marketing resources, it will be unlikely to grow its
revenue in any substantial way.

To address the issue of the need for additional working capital to
grow the Company, Management has first been concentrating on
achieving at least a year's worth of consistent operating profit.
The next step is to complete a 1:10 reverse stock split as
recommended by Management in a proxy recently sent out the
Company's shareholders in preparation for an upcoming shareholders
meeting on November 17, 2004. If approved, the reverse split will
provide the Company with a number of unpledged, authorized shares
that Management could use in its search for additional investors
and/or for any potential business combinations that it feels would
be beneficial to shareholders and to the Company's growth
potential. There are currently no plans or arrangements or
agreements to issue additional securities in order to raise
additional capital. In addition, in early 2004 Management was able
to extend to September 30, 2005 the maturity date of all
convertible notes that were scheduled to mature in 2004 (no other
terms were altered on these notes -- just the maturity date was
extended). All the Company's convertible notes now mature on
September 30, 2005 and thus Management has had and will continue
to have a period of time in which to focus more fully on
generating consistent profitability and growth. Finally, in early
2004 Management obtained a $400,000 secured line of credit with
one of its investors to replace a previous receivables factoring
line of credit with a division of the Cupertino National Bank. The
new line of credit is secured by the assets of the Company and
carries a 12% interest rate. The Company currently does not have
the resources to repay these notes and there can be no assurance
that it will be able to negotiate a further extension in their
maturities.

                      Results of Operations

            Nine-Month Period Ended Sept. 30, 2004 versus
               Nine-Month Period Ended Sept. 30, 2003

The Company's revenues for the 9-month period ended September 30,
2004 decreased 7.3% to $1,186,135 from $1,279,362 for the 9-month
period ended September 30, 2003. The primary factors in this
decrease in revenue are the continued sluggishness in state and
municipal spending related to the continued weakness in state and
municipal finances, diminishing migration revenue as the number of
the Company's legacy customers approaches zero and the lack of
full-time sales and marketing resources at the Company.

Cost of sales decreased $32,722 or 35.4% to $59,619 for the 2004
period from $92,342 for the 2003 period. During this same period,
the Company experienced an improvement in gross margin to 95.0% in
the 2004 period from 92.8% in the 2003 period. The decrease in
cost of sales is due primarily to the change in the mix of
products being sold between periods. For the last several years
the Company has been successfully reducing the amount of third-
party hardware that it resells, which typically has only single-
digit margins. Hardware sales, while they help top-line revenue,
tie up a disproportionate amount of working capital and have
required excessive finance and support resources to administer and
track. The Company would prefer not to be involved in the
integration of hardware.

The Company's operating expenses decreased $338,384 or 24.6% to
$1,034,833 for the 2004 period from $1,373,267 for the 2003 period
as a result of the Company's focus on bringing its cost structure
into line with revenues.

Of the Company's operating expenses, personnel costs decreased
24.4% or $251,435 to $777,710 in the 2004 period from $1,029,145
for the 2003 period. This reduction was due in part to a small
reduction in headcount and from the expiration of the commercial
services contract with one of our investors. This contract,
entered into during the second quarter of 2002, provided that
eight of the Company's employees became employees of the
investor's company and were leased back to the Company. This
company invoiced Pamet quarterly for the cost of the employees who
remained based in Pamet's Acton headquarters and worked on
projects exclusively for the Company during the term of the
agreement. The net result of this agreement was to reduce the
Company's 2002 working capital requirements, but under the
agreement the Company still realized the expenses as personnel
expenses. As part of the contract, Pamet was charged a 12% general
administrative charge levied on top of the salary expenses covered
in the commercial services contract. When Pamet terminated the
contract at the end of June 2003, the full impact of the resulting
decrease in these 12% charges was experienced in the 2004 period.

Facilities costs decreased by 11.6% or $21,657 to $164,756 for the
2004 period from $186,413 for the 2003 period. This decrease was
attributable primarily to decreases in gas, telephone & Internet
and cleaning expenses and an increase in sublease revenue. Travel
and entertainment expenses grew $4,516 or 30.2% to $19,463 for the
2004 period from $14,947 for the 2003 period. This increase
reflected the Company's efforts to exhibit at more regional trade
shows and make more sales calls with its part-time sales force.
Spending on professional fees decreased $32,644 or 60.8% to
$21,044 for the 2004 period from $53,688 for the 2003 period. The
decrease was attributable to the decrease in legal and accounting
fees that resulted in the Company's decision, announced in January
2004, to deregister as a public company. Depreciation and
amortization expense decreased 100.0% or $25,092 to $0 for the
2004 period from $25,092 for the 2003 period reflecting the fact
that all the Company's capital assets are fully depreciated.

Other operating expenses decreased 18.9% or $12,072 to $51,910 for
the 2004 period from $63,982 for the 2003 period. The decrease is
attributable primarily to a decrease in computer-related expenses,
office expenses and marketing expenses.

Net interest/Other Income expense increased 15.3% or $30,729 to
$240,734 in the 2004 period from $200,288 for the 2003 period.
This increase resulted interest payments on the $400,000 line of
credit the Company established with one of its investors in early
2004.

The Company's net loss decreased 63.9% or $247,150 to ($149,101)
for the 2004 period from ($386,534) for the 2003 period. This
corresponds to $(0.03) per share loss in the 2004 period compared
to a $(0.09) per share loss for the 2003 period.

                  Liquidity and Capital Resources

The Company had a working capital deficit of $(6,397,422) at
September 30, 2004 compared to $(1,978,187) at September 30, 2003.
The most significant reason for this decrease is the
reclassification of $4,491,545 in long-term notes and accrued
interest to current. These notes are due September 30, 2005.

During the 2003 period, the Company secured $50,000 of long-term
debt financing. In addition, the Company successfully negotiated
amendments to $445,855 in convertible promissory notes maturing in
2004, extending them to 2005 with revised terms.

At September 30, 2004, $3,565,978 of convertible promissory notes
and $914,491 of related interest remained outstanding as
liabilities. The maturity date of these notes is September 30,
2005. These amounts on the balance sheet are reported net of
$12,785 in discounts for detachable warrants issued on the debt.
In general, the outstanding convertible debt funding accrues
interest at 7%; is convertible into common stock at the option of
the debt holder at conversion prices ranging from $0.115 to $0.25
per share; and has 20% or 100% warrant coverage attached,
depending on the note, that allows for the purchase of additional
shares of common stock at exercise prices ranging from $0.25 to
$1.00 per share, depending on the note. The Company's ability to
repay the outstanding convertible promissory notes with accrued
interest on due dates is at risk. There can be no assurance that
the Company will be able to negotiate another extension of the
maturities of these notes. As of October 2003, $37,500 of the debt
has matured and is being paid off over approximately 75 weeks in a
series of partial payments.

During the last quarter of 2002, it became apparent to the new
Management that the Company had more shares issued on a fully-
diluted basis (including shares issuable pursuant to warrants,
options and convertible notes) than were authorized under its
articles of incorporation. The Company is currently authorized to
issue 7,500,000 shares. Although in July 2000 shareholders
approved a request to increase authorized shares to 30 million,
the Company did not have sufficient funds to pay the requisite
state fees and thus it was unable to increase its authorized share
limit to 30 million. The number of shares of common stock legally
issued and outstanding at September 30, 2004 was 4,437,976.
However, the Company has entered into various transactions in
which it is obligated to issue an aggregate of 2,950,277 shares of
Common Stock (the "Committed Shares"), but the Company does not
have a sufficient number of authorized and unissued shares to
issue the Committed Shares after factoring in the number of
Derivative Shares (defined below). Accordingly, the Company has
proposed a 1:10 reverse stock to its shareholders. This split will
be voted on in a November 17, 2004 special shareholders meeting.
This Reverse Stock Split will allow the Company to fulfill its
contractual obligations to such third parties by allowing it to
issue the Committed Shares. In addition, the Company needs to have
a sufficient number of shares of Common Stock available for
issuance upon the exercise or conversion of its options, warrants
and convertible notes (the "Derivative Securities"). Since the
Derivative Securities are currently out of the money, it is not
expected that they will be exercised or converted at this time.
However, the Company wants to have sufficient authorized capital
in order to issue its Common Stock in the event of an exercise or
conversion of the Derivative Securities. The Derivative Securities
currently outstanding represent 28,688,271 shares of Common Stock.

In addition, the Company would like to have a sufficient number of
authorized and unissued shares of Common Stock that can be issued
in connection with such corporate purposes as may be considered
advisable from time to time by the Board of Directors. Such
corporate purposes include:

     (i) raising capital in order to have necessary capital
         resources to grow the business,

    (ii) having shares (pursuant to options or other equity
         incentives) available for employees and prospective
         employees and

   (iii) for acquisitions or other business combinations or
         collaborations.

Having such shares available for issuance in the future will give
the Company greater flexibility and will allow such shares to be
issued as determined by the Board of Directors without the expense
and delay of a special shareholders' meeting to approve such
additional authorized capital stock. There are currently no plans
or arrangements or agreements to issue additional securities in
order to raise additional capital.

Cash decreased to $919 at September 30, 2004 from $37,891 at
September 30, 2003. The resources necessary to provide working
capital for operations and to provide the resources for growth
continue to be a major concern for the Company. The problems
associated with an inadequate amount of working capital (such as
inability to have the necessary resources to operate and expand
the business) are exacerbated by the continued sluggishness in
sales resulting primarily from the continuing slowdown in the
general economic conditions and in the public safety marketplace
that began in the second half of 2000. Because of these problems
and the necessity of the Company to continue to strictly control
its expenses despite the need for additional sales and marketing
resources, the Company has not been able to expend any additional
resources to increase sales. The Company continues to be hampered
by insufficient cash resources. There can be no assurances that
the Company will be able to generate adequate cash either through
operations or additional financing to continue as a going concern.
There can be no assurance about the Company's ability to repay its
indebtedness or other obligations as they become due. If the
Company's financial difficulties continue, it could have a
material adverse effect on the Company, its creditors and its
stockholders.

As of December 31, 2003, the Company had accumulated $13,790,000
of federal net operating loss carryforwards that expire beginning
in the year 2005. In addition, the Company has state net operating
losses to carry forward of $8,772,264 which expire between the
years 2004 and 2007. Under the Internal Revenue Code of 1986, as
amended, the rate at which a corporation may utilize its net
operating losses to offset income for federal tax purposes is
subject to specified limitations during periods after the
corporation has undergone an "ownership change." It has been
determined that an ownership change did take place at the time of
the Company's initial public offering in 1990. However, the
limitations on the loss carryforward exceed the accumulated loss
at the time of the "ownership change," thus there is no
restriction on its use.

At Sept. 30, 2004, Pamet Systems' balance sheet showed a
$6,336,905 stockholders' deficit.


PANOLAM INDUSTRIES: S&P Places B+ Rating on Planned $20M Facility
-----------------------------------------------------------------
Standard & Poor's Ratings Services assigned its 'B+' bank loan
rating and '2' recovery rating to Panolam Industries International
Inc.'s proposed first-lien $20 million revolving credit facility
and $130 million term loan B.  The bank loan is rated the same as
the corporate credit rating; the '2' recovery rating indicates
that bank lenders can expect substantial recovery of principal
(80% to 100%) in the event of default.

Standard & Poor's also assigned its 'B-' bank loan rating and '5'
recovery rating to the company's proposed $75 million second-lien
term loan C.  The second-lien term loan is rated two notches below
the corporate credit rating; the '5' recovery rating indicates
that bank lenders can expect negligible recovery of principal (0%
to 25%) in the event of default.  The Shelton, Connecticut-based
company's 'B+' corporate credit rating was affirmed.  The outlook
is stable.

"The ratings on Panolam reflect the company's exposure to the
cyclicality of residential and commercial new construction and
remodeling activities, volatile raw-material costs, limited
product diversity, and a highly leveraged capital structure," said
Standard & Poor's credit analyst Lisa Wright.  These factors are
partly offset by the company's market leadership in niche
decorative panels markets, attractive operating margins, and its
ability to generate free cash flow, even during an industry
downturn.

Panolam plans to use proceeds of the proposed bank loans to pay a
$64 million dividend to its shareholders--private equity sponsor
The Carlyle Group and company management--and to refinance
approximately $140 million of existing debt.

Panolam, with annual revenues of about $260 million, is the
leading North American manufacturer of decorative thermally fused
melamine panels -- TFMs -- and also participates in the market for
high-pressure laminate panels, which are used in interior
surfacing applications requiring greater surface wear and impact
resistance than TFMs.  About 80% of the company's sales are made
to commercial end markets and 20% to residential end markets.  
About one-fourth of its sales are made to U.S. furniture
manufacturers; this market has contracted significantly due to
increased competition from China.


PEGASUS SATTELITE: Wants Exclusive Periods Extended Until Mar. 31
-----------------------------------------------------------------
By this motion, the Pegasus Satellite Communications, Inc. and its
debtor-affiliates ask the United States Bankruptcy Court for the
District of Maine to further extend their:

    (a) exclusive period to file a plan of reorganization
        through January 31, 2005; and

    (b) exclusive period to solicit acceptances that plan
        through March 31, 2005.

The Debtors have taken several key steps towards a successful and
consensual resolution of their Chapter 11 cases, Robert J. Keach,
Esq., at Bernstein, Shur, Sawyer & Nelson, in Portland, Maine,
says.  The most notable one was the consummation of the sale of
substantially all of their Direct Broadcast Satellite business
assets and the Global Settlement.

                  Proposed Sale of Broadcast Assets

Due to the sale of the DBS business to DIRECTV, Inc., the assets
related to the Debtors' broadcast television business comprise
substantially all of the Debtors' remaining assets.  As part of
the Global Settlement, the Official Committee of Unsecured
Creditors and Pegasus Communications Corporation have agreed that
the Broadcast Assets will be sold to PCC for $75,000,000 in cash,
subject to better and higher offers, and with no break up fee.

Mr. Keach tells Judge Haines that the agreement with the
Committee and PCC provides the Debtors with a clear path to
complete a reorganization plan promptly following the sale of the
Broadcast Assets.  Because PCC is intimately familiar with these
assets and has little timing risk on receiving required FCC
approvals, PCC is well situated to provide the negotiated floor
bid, subject to higher and better offers.

Despite the facilitating factor -- because the PCC bid is subject
to higher and better offers and because the Debtors and Committee
want to encourage active bidding for the Broadcast Assets -- the
negotiations regarding the structure and documentation of the sale
of the Broadcast Assets involve complex corporate, regulatory and
tax issues.  The complexity of the issues involved in the sale of
the Broadcast Assets far exceeds the parties' initial expectations
of the task at hand.

Given the progress made to date, the Debtors anticipate in the
next several weeks that the terms of the sale of the Broadcast
Assets will be negotiated and memorialized in an agreement between
PCC and the Debtors and that they will be filing a motion to:

    (A) approve the form of Subscription Agreement with PCC,
        subject to higher and better offers;

    (B) approve certain bidding procedures;

    (C) schedule a hearing to consider approval of the sale of
        substantially all of the Broadcast Assets;

    (D) approve the form and manner of notice of the auction and
        sale; and

    (E) authorize the sale of substantially all of the Broadcast
        Assets free and clear of all liens, claims, interests and
        encumbrances.

Since the Chapter 11 plan for the Debtors will incorporate the
sale of the Broadcast Assets, the Debtors anticipate that once the
Broadcast Sale Motion is filed, the Debtors will be able to
negotiate and propose a Chapter 11 plan.

                           Employee Issues

One of the significant challenges that the Debtors have faced
throughout their Chapter 11 cases has been dealing with employee
unrest and declining employee morale.  Thus, senior management
together with their attorneys and advisors devoted significant
time and energy into trying to incentivize employees to remain in
the Debtors' employ first during the process of selling and
transitioning the DBS business to DIRECTV and during the process
of selling the Broadcast Assets and through the plan confirmation
and consummation process.

The Debtors sought to implement an employee retention plan to
provide a variety of incentives and benefits to certain of their
management employees who have responsibilities relating to the
DBS business.  The Initial Key Employee Retention Plan Motion was
filed just two days after the Court denied the Debtors' request
for a temporary restraining order against DIRECTV and the
National Rural Telecommunication Cooperative in the adversary
proceeding that the Debtors had commenced against them.  Given the
high stakes of the Cornerstone Litigation and the NRTC's purported
notice of termination effective August 31, 2004, most employees
believed that they would be out of work, at the latest, by the end
of the summer.  Unfortunately, this has proven to be somewhat
prophetic, as three-fourths of the Debtors' prepetition workforce
related to their DBS business has been terminated on or before
October 31, 2004.

In connection with the Global Settlement, the Debtors and
Committee were able to reach an agreement on the Proposed KERP
with respect to the remaining facets of the program that had not
previously been agreed to with respect to the junior management
employees and with respect to all components of the Proposed KERP
for certain senior management employees.

The Debtors also sought and obtained the Court's authority for a
supplemental management retention plan for Ted S. Lodge,
President, Chief Operating Officer and Counsel for each of the
Debtors.

In addition, the Debtors have been challenged to retain employees
of the Broadcast Debtors given the uncertainty of whether PCC or a
third party will be the winning bidder for the Broadcast Assets.  
Those employees are needed throughout the sale process for the
Broadcast Assets and any transition period to the winning bidder.  
Accordingly, the Debtors and Committee have been actively
negotiating an employee retention plan for certain management
employees of the Broadcast Debtors.  The Debtors anticipate filing
a motion in the near future to have that program approved by the
Court.

                           Claims Process

The General Bar Date for filing proofs of claim has passed.  The
Debtors, with the help of their claims agent, The Trumbull Group,
LLC, and their financial advisors, FTI Consulting, Inc., are in
the process of reviewing and analyzing the claims filed.  They
will continue this process with respect to governmental claims
after the November 30, 2004, governmental bar date has passed.  
Accordingly, the Debtors have accomplished the necessary first
step in quantifying all potential liabilities.

                            Cost Savings

One of the most significant cost-saving measures that the Debtors
undertook was the filing the Repayment Motion, which provided for
the repayment of principal and non-default accrued interest with
respect to the senior and junior secured loans outstanding as of
the Petition Date.  The Debtors were able to save about $1,000,000
per week in interest and other amounts accruing under the
applicable loan and security documents.

                   Review of Contracts and Leases

Furthermore, the Debtors, together with their counsel and other
advisors, have undertaken an extensive analysis of numerous
contracts and leases relating to the DBS business.  As a result
the Debtors have sought to reject certain unexpired leases and
executory contracts.

                     Extension Should be Granted

Collectively, the Debtors' actions in establishing bar dates,
repaying principal and non-default interest to the secured
lenders, and rejecting certain leases and executory contracts have
helped quantify and minimize their liabilities for the benefit of
their estates, a necessary step in formulating and confirming a
Chapter 11 plan.

Mr. Keach asserts that all of the Debtors' activities to date have
been aimed at their ultimate goal -- to propose a consensual
reorganization plan.  While the Debtors have made significant
progress towards reaching that goal with the closing of the sale
to DIRECTV of the DBS business, additional time is still needed
with respect to the Broadcast Assets.  The sale of the Broadcast
Assets is a complex transaction given the myriad of corporate,
tax, and regulatory issues that must be addressed with respect to
the sale of the Broadcast Assets.

The Debtors, Committee and PCC have worked diligently together in
addressing issues and finalizing the framework for the sale
transaction.  Since the sale of the Broadcast Assets will be part
and parcel of a Chapter 11 plan or plans that the Debtors will
propose, the plan process has taken longer than the Debtors
originally anticipated.  However, the Debtors believe that they
will be able to file a Chapter 11 plan and solicit acceptances of
that plan within the additional time frames requested.

Mr. Keach states that the chances of obtaining a consensual
reorganization plan will be decidedly increased if the Debtors are
allowed the time to finalize the framework for the sale of the
Broadcast Assets and incorporate that structure into a Chapter 11
plan, free from the distractions of a competing plan of
reorganization.  To deny an extension would jeopardize the
significant progress the Debtors have made to date.

Mr. Keach assures the Court that extending the Exclusive Periods
will not prejudice the legitimate interests of any creditor or
equity security holder, and will afford the parties the
opportunity to pursue to fruition the beneficial objectives of a
consensual reorganization plan.

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 NATIONAL: Moody's Reviewing Low-B Ratings Due to Merger Plans
------------------------------------------------------------------
Moody's Investors Service placed the ratings of Penn National
Gaming, Inc. and Argosy Gaming Company on review for possible
downgrade following the announcement that both companies entered
into a definitive merger agreement under which Penn will acquire
all of the outstanding shares of Argosy Gaming for $47.00 per
share.  The transaction is valued at approximately $2.2 billion,
including approximately $805 million of long-term debt of Argosy
Gaming and its subsidiaries.  This represents about an 8.5
purchase multiple based on Argosy's most recent 12-month EBITDA.

Pro forma debt/EBITDA for the combined entity is about 5.8x, a
level Moody's considers high for the Ba3 senior implied rating
category.  Penn's ability to maintain its Ba3 senior implied
rating will depend on the company's ability and willingness to
maintain debt/EBITDA at or below 4.5x over the long-term.  
Although the company has been able to quickly accomplish
meaningful debt reduction following prior acquisitions, the
considerable size of this acquisition creates a debt burden that
may be more difficult to reduce over the next two years,
particularly if Penn pursues additional acquisitions during that
time period.

Moody's expects to meet with Penn's management in the next few
weeks to discuss transaction specifics as well as debt reduction
plans over the next two years.  The rating decision will also take
into account any changes in Moody's understanding of Penn's
overall financial policy and growth strategy.  Moody's expects to
make a rating decision prior to the end of this year.

The transaction is subject to approval by the Argosy Gaming
stockholders and by each company's respective state regulatory
bodies, and to certain other necessary regulatory approvals and
other customary closing conditions contained in the merger
agreement.  The transaction is not conditioned on financing and is
expected to close in the second half of 2005.  Penn has received a
$2.9 billion senior secured underwritten commitment from several
large banks.

These Penn National ratings were placed on review for possible
downgrade:

   * Senior implied rating -- Ba3;
   * Senior unsecured issuer rating -- B1;
   * $399.7 million senior secured term loan D due 2007 - Ba3.
   * $100 million senior secured revolving credit facility due
     2007 -- Ba3;
   * $200 million 11.125% senior subordinated notes due 2008 - B2;
   * $175 million 8.875% senior subordinated notes due 2010 - B2;
     and
   * $200 million 6.875% senior subordinated notes due 2011 - B2.

These Argosy ratings were placed on review for possible downgrade:

   * Senior implied rating - Ba2;
   * Senior unsecured issuer rating - Ba3;
   * $500 million senior secured revolver due 2009 - Ba1;
   * $175 million senior secured term loan B due 2011 - Ba1;
   * $350.0 million 7% non-guaranteed senior subordinated debt due
     2014 - B1;
   * $200.0 million 9% guaranteed senior subordinated notes due
     2011 - Ba3;
   * Senior secured shelf - (P)Ba1;
   * Senior unsecured shelf -(P)Ba3;
   * Senior subordinate shelf - (P)B1; and
   * Subordinate shelf - (P)B2.

Headquartered in Wyomissing, Pennsylvania, Penn National Gaming,
Inc. owns and operates: three Hollywood Casino properties located
in Illinois, Mississippi and Louisiana; Charles Town Races & Slots
in West Virginia; two Mississippi casinos; a riverboat gaming
facility in Louisiana; and the Bullwhackers casino properties in
Colorado.

Headquartered in Alton, Illinois, Argosy Gaming Company owns and
operates the Alton Belle Casino and the Empress Casino Joliet in
Illinois; the Argosy Casino Riverside in Missouri; the Argosy
Casino Baton Rouge in Louisiana; the Argosy Casino Sioux City in
Iowa; and the Argosy Casino Lawrenceburg in Indiana.


PEREGRINE SYSTEMS: Providing Update in Nov. 10 Conference Call
--------------------------------------------------------------
Peregrine Systems, Inc. (OTC: PRGN), a provider of asset and
service management solutions, will host a conference call on
Wednesday, Nov. 10, at 2:00 p.m. PST (5:00 p.m. EST) to provide a
business update for investors, customers, partners and other
stakeholders.

During the conference call, John Mutch, Peregrine president and
CEO, plans to provide an update of the company's strategic and
operational initiatives, discuss its current business model and
elaborate on its organizational plans for the remaining quarters
of the fiscal year. The company does not plan to discuss its
financial condition or address questions during this call.

The company is making steady progress to become current in the
filing of its periodic reports with the U.S. Securities and
Exchange Commission. Earlier this week, Peregrine filed its
historical quarterly reports on Form 10-Q for its fiscal 2004
quarters ended Sept. 30, 2003 and Dec. 31, 2003, and the company
is working to complete its annual report on Form 10-K for the
fiscal year ended March 31, 2004 as well as its quarterly reports
on Form 10-Q for the fiscal 2005 quarters ended June 30, 2004 and
Sept. 30, 2004. However the company does not know when it will be
in a position to file these reports. Until the company's periodic
reports are current, investors will not have current financial
information. For this reason, and based on the other risk factors
described in the company's fiscal year 2003 Form 10-K, Peregrine
believes that trading in its securities at this time is highly
speculative and involves a high degree of risk.

To participate in the conference call, please call 888-208-1812 or
719-457-2654. A replay of the call, which can be accessed by
calling 888-203-1112 or 719-457-0820, will be available until Nov.
17. The confirmation code for both the live call and replay is
965375.

                        About the Company

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

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

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


PG&E NATIONAL: Moves to Pay TransCanada $12.7 Mil. Break-Up Fee
---------------------------------------------------------------
John Lucian, Esq., at Blank Rome, LLP, in Baltimore, Maryland,  
reports that TransCanada Hydro Northeast, Inc., was unwilling to  
hold open its offer to purchase the Hydro Facilities under the  
terms of the Purchase Agreement unless it is compensated for the  
considerable time, money, and energy it expended in pursuing a  
transaction with USGen New England, Inc.

Accordingly, the parties agreed that if the Purchase Agreement is  
terminated as a result of USGen pursuing a Qualified Bid, which  
is superior to the offer made by TransCanada, USGen will  
reimburse TransCanada for its actual reasonable expenses not to  
exceed $5,000,000 and pay a $12,750,000 break-up fee.  The  
Expense Reimbursement Fee and the Break-Up Fee will constitute  
administrative superpriority expenses of USGen's estate under  
Sections 503(b), 507(a)(1), and 507(b) of the Bankruptcy Code in  
full satisfaction of any and all claims of TransCanada relating  
to the termination of the Purchase Agreement.  The Expense  
Reimbursement Fee and the Break-Up Fee would be payable in  
accordance with the terms of the Purchase Agreement.

The Break-Up Fee represents 2.5% of the total purchase price  
before giving effect to TransCanada's assumption of various  
Assigned Contracts and Leases and other obligations.

Mr. Lucian assures the Court that the payment of the Expense  
Reimbursement Fee and the Break-Up Fee will not diminish USGen's  
estate.  Moreover, USGen will not terminate the Purchase  
Agreement so as to incur the obligation to pay the Expense  
Reimbursement Fee and the Break-Up Fee, unless to accept a  
Qualified Bid which is superior to the offer made by TransCanada.

Hence, USGen seeks the Court's authority to pay the Expense  
Reimbursement Fee and the Break-Up Fee.

Headquartered in Bethesda, Maryland, PG&E National Energy Group,
Inc. -- http://www.pge.com/-- (n/k/a National Energy & Gas  
Transmission, Inc.) develops, builds, owns and operates electric
generating and natural gas pipeline facilities and provides energy
trading, marketing and risk-management services.  The Company
filed for Chapter 11 protection on July 8, 2003 (Bankr. D. Md.
Case No. 03-30459).  Matthew A. Feldman, Esq., Shelley C. Chapman,
Esq., and Carollynn H.G. Callari, Esq., at Willkie Farr &
Gallagher represent the Debtors in their restructuring efforts.  
When the Company filed for protection from its creditors, it
listed $7,613,000,000 in assets and $9,062,000,000 in debts. NEGT
received bankruptcy court approval of its reorganization plan in
May 2004, and emerged from bankruptcy on Oct. 29, 2004. (PG&E
National Bankruptcy News, Issue No. 29; Bankruptcy Creditors'
Service, Inc., 215/945-7000)


PG&E NATIONAL: Wants Court OK on Hydro Facilities Bidding Protocol
------------------------------------------------------------------
USGen New England, Inc., asks the Court to establish uniform  
bidding procedures so it may identify and select higher and  
better offers for its Connecticut River and Deerfield River  
hydroelectric systems.  USGen believes that an auction of the  
Hydro Facilities conducted in accordance with the Bidding  
Procedures will preserve the benefits of the Purchase Agreement  
and facilitate the receipt and analysis of competing bids, as  
well as maximize the Hydro Facilities' value.

USGen proposes that the deadline for submitting bids for the  
Hydro Facilities will be no later than 12:00 noon Eastern Time on  
December 3, 2004.  If needed, USGen will conduct an auction on  
December 9, 2004.

To qualify, potential purchasers must execute confidentiality  
agreements with USGen and provide evidence of their financial  
ability to purchase the Hydro Facilities and timely consummate  
the sale.  Qualified Bidders must also provide USGen with a copy  
of their proposed modifications to the existing Purchase  
Agreement.

Each Qualified Bidder must produce a mark-up of TransCanada  
Purchase Agreement that exceeds the cash amount payable under the  
Purchase Agreement by at least $22,750,000, which excess  
represents an amount equal to the $12,750,000 Break-Up Fee, plus  
the $5,000,000 maximum amount of the Expense Reimbursement, plus  
$5,000,000.  Additionally, each bid must be accompanied by a good  
faith deposit equal to 4% of the cash portion of the Purchase  
Price, in the form of a wire transfer payable to an escrow  
account designated by USGen.

The TransCanada Purchase Agreement is a qualified bid.   
TransCanada, however, may make subsequent bids at the Auction.   
Additionally, TransCanada may include the Break-Up Fee and  
Expense Reimbursement in the amount of any subsequent bid.   
TransCanada is entitled to credit the amount of the Break-Up Fee  
and Expense Reimbursement against the purchase price of the  
subsequent bid payable at the Closing.

A full-text copy of the Bidding Procedures is available at no  
charge at:

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

USGen also asks the Court to hold a sale hearing on December 15,  
2004.  In the event an Auction occurs on December 9, 2004, and  
TransCanada is not the Winning Bidder, USGen requests that the  
Sale Hearing be scheduled for January 6, 2005.

USGen will mail notices of the Bid Deadline, the Auction, and the  
Sale Hearing to all known creditors.  USGen will also publish the  
Notices in The National Edition of The Wall Street Journal.

USGen will consult the Official Committee of Unsecured Creditors  
on a timely basis concerning all acts, decisions or  
determinations that USGen makes in connection with the bidding  
and the sale transaction.

Headquartered in Bethesda, Maryland, PG&E National Energy Group,
Inc. -- http://www.pge.com/-- (n/k/a National Energy & Gas  
Transmission, Inc.) develops, builds, owns and operates electric
generating and natural gas pipeline facilities and provides energy
trading, marketing and risk-management services.  The Company
filed for Chapter 11 protection on July 8, 2003 (Bankr. D. Md.
Case No. 03-30459).  Matthew A. Feldman, Esq., Shelley C. Chapman,
Esq., and Carollynn H.G. Callari, Esq., at Willkie Farr &
Gallagher represent the Debtors in their restructuring efforts.  
When the Company filed for protection from its creditors, it
listed $7,613,000,000 in assets and $9,062,000,000 in debts. NEGT
received bankruptcy court approval of its reorganization plan in
May 2004, and emerged from bankruptcy on Oct. 29, 2004. (PG&E
National Bankruptcy News, Issue No. 29; Bankruptcy Creditors'
Service, Inc., 215/945-7000)


PILGRIM'S PRIDE: S&P Puts Low-B Ratings on $500M Debt Securities
----------------------------------------------------------------
Standard & Poor's Ratings Services revised its outlook on
vertically integrated poultry processor Pilgrim's Pride Corp. to
stable from negative.

At the same time, Standard & Poor's assigned its preliminary 'BB-
/B+' ratings on the company's $500 million debt securities Rule
415 shelf filing, which allows Pilgrim's Pride to issue senior
unsecured or subordinated debt.  Also, Standard & Poor's affirmed
its ratings on the company, including its 'BB' corporate credit
rating.  Pittsburg, Texas-based Pilgrim's Pride had about
$796 million of debt that was outstanding (including accounts
receivable securitization) at July 3, 2004.

"The outlook revision reflects the company's improved operating
performance and the related improvement in financial measures
since the acquisition of ConAgra Foods Inc.'s fresh chicken
division in November 2003, fairly positive industry and
consumption trends, and the expectation of lower feed costs (which
account for about 33% of total costs)," said Standard & Poor's
credit analyst Jayne M. Ross.  In addition, the company has
realized about $27 million of the $50 million in cost savings from
integrating ConAgra Foods' operations well ahead of schedule.  The
expectation is that the remaining $13 million in savings will
occur by the end of the first quarter of fiscal 2005 (2004
calendar year end).

There is cyclicality in the commodity-oriented poultry industry,
which will result in volatility in earnings and credit protection
measures.  Key to a revision of the outlook to positive will be
the company's ability to sustain fairly strong credit measures, on
average, throughout a business cycle.


PILLOWTEX CORP: Selling Miscellaneous Assets for $350,000
---------------------------------------------------------
Pursuant to the Court-approved Miscellaneous Asset Sale
Procedures, Pillowtex Corporation and its debtor-affiliates notify
the Court that they will sell these miscellaneous assets for
$350,000:

(1) Assets:            Certain inventory, located in Kannapolis,
                        North Carolina

     Debtor-seller:     PTEX, Inc.

     Purchaser:         International Home Fashions, Inc.

     Price:             $200,000

(2) Assets:            Certain inventory, located in Kannapolis,
                        North Carolina

     Debtor-seller:     PTEX, Inc.

     Purchaser:         International Home Fashions, Inc.

     Price:             $150,000

Headquartered in Dallas, Texas, Pillowtex Corporation --
http://www.pillowtex.com/-- sold top-of-the-bed products to  
virtually every major retailer in the U.S. and Canada.  The
Company filed for Chapter 11 protection on November 14, 2000
(Bankr. Del. Case No. 00-4211), emerged from bankruptcy under a
chapter 11 plan, and filed a second time on July 30, 2003 (Bankr.
Del. Case No. 03-12339).  The second chapter 11 filing triggered
sales of substantially all of the Company's assets.  David G.
Heiman, Esq., at Jones Day, and William H. Sudell, Jr., Esq., at
Morris Nichols Arsht & Tunnel, represent the Debtors.  On July 30,
2003, the Company listed $548,003,000 in assets and $475,859,000
in debts. (Pillowtex Bankruptcy News, Issue No. 71; Bankruptcy
Creditors' Service, Inc., 215/945-7000)


QUIGLEY COMPANY: Judge Beatty Denies Committee's Recusal Motion
---------------------------------------------------------------
The Honorable Prudence Carter Beatty declined a request from the
Official Committee of Unsecured Creditors (comprised of asbestos
claimants) appointed in Quigley Company, Inc.'s chapter 11 case to
step down in the company's on-going restructuring proceeding.  
Judge Beatty denied the Committee's motion seeking her recusal
pursuant to 28 U.S.C. Sec. 455.  Judge Beatty rejects the
Committee's out-of-context snippets from the transcript of the
first-day hearing in Quigley's case as evidence demonstrating that
her "impartiality might reasonably be questioned."  

"I do not believe that my recusal is warranted," Judge Beatty said
from the bench at the Nov. 1 hearing on this matter.  "I do not
believe that I am partial, and I don't believe that I have created
the appearance of partiality, and I don't think there is a
reasonable question about my impartiality."  

Judge Beatty says the Committee distorts what she said at the
first-day hearing.  

A full-text copy Judge Beatty's Nov. 1 Bench Ruling is available
at no charge at:

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

Quigley and Pfizer, Inc., supported Judge Beatty's continuing
oversight of the chapter 11 process.  

Elihu Inselbuch, Esq., at Caplin & Drysdale, Chartered,
representing the Committee, asked Judge Beatty for a stay of her
recusal order pending an appeal to the U.S. District Court.  Judge
Beatty rejected that suggestion.  

As previously reported in the Troubled Company Reporter, the
Official Committee of Unsecured Creditors was offended by comments
Judge Beatty made from the bench at the First Day Hearing in
Quigley's case.  She questioned:

     -- the extent of the Debtor's asbestos-related liability,
     -- the legitimacy of asbestos-related claims, and
     -- the number of legitimate claimants.

Judge Beatty suggested that claimants might have to prove their
claims.

When lawyers at Weitz & Luxenberg told Judge Beatty they
represented 20% of claimants against Quigley, she asked, "Haven't
I seen the name of your firm on subway train ads, looking for more
people?"

A full-text copy of the Committee's Recusal Motion and Memorandum
of Law is available at no charge at:

          http://bankrupt.com/misc/102-A.pdf

and a transcript of the First Day Hearing the Committee finds
offensive is available at no charge at:

          http://bankrupt.com/misc/102-B.pdf

Elihu Inselbuch, Esq., Peter Van N. Lockwood, Esq., Walter B.
Slocombe, Esq., Albert G. Lauber, Esq., and Preston Burton, Esq.,
at Caplin & Drysdale, Chartered, represent the Committee.

Headquartered in Manhattan, Quigley Company is a subsidiary of
Pfizer, Inc., which used to produce and market a broad range of
refractories and related products to customers in the iron, steel,
glass and other industries.  The Company filed for chapter 11
protection on Sept. 3, 2004 (Bankr. S.D.N.Y. Case No. 04-15739) to
resolve legacy asbestos-related liability. When the Debtor filed
for protection from its creditors, it listed $155,187,000 in total
assets and $141,933,000 in total debts.  Pfizer has agreed to
contribute $405 million to an Asbestos Claims Settlement Trust
over 40 years through a note, contribute approximately $100
million in insurance, and forgive a $30 million loan to Quigley.
Michael L. Cook, Esq., at Schulte Roth & Zabel LLP, represents the
Company in its restructuring efforts.


QUIGLEY COMPANY: Look for Bankruptcy Schedules by November 19
-------------------------------------------------------------
The U.S. Bankruptcy Court for the Southern District of New York
gave Quigley Company, Inc., more time to file its schedules of
assets and liabilities, statement of financial affairs, and
schedule of executory contracts and unexpired leases. The Debtor
has until November 15, 2004, to file those documents.

Quigley Company tells the Court that the extension will give it
more time to:

    a) compile and list in Quigley Company's Schedules information
       for each of the more than 160,000 plaintiffs who have
       asserted asbestos-related personal injury claims against
       Quigley; and

    b) review and reconcile Quigley Company's books and records in
       order to provide accounting and financial information to
       complete the Schedules.

Quigley Company assures the Court that the extension will not
prejudice any creditors or other parties in interest as it will
request the establishment of a date by which all proofs of claim
must be filed that is consistent with the extension it requested.

Headquartered in Manhattan, Quigley Company is a subsidiary of  
Pfizer, Inc., which used to produce and market a broad range of  
refractories and related products to customers in the iron, steel,  
glass and other industries. The Company filed for chapter 11  
protection on Sept. 3, 2004 (Bankr. S.D.N.Y. Case No. 04-15739) to  
resolve legacy asbestos-related liability. When the Debtor filed  
for protection from its creditors, it listed $155,187,000 in total  
assets and $141,933,000 in total debts. Pfizer has agreed to  
contribute $405 million to an Asbestos Claims Settlement Trust  
over 40 years through a note, contribute approximately $100  
million in insurance, and forgive a $30 million loan to Quigley.  
Michael L. Cook, Esq., at Schulte Roth & Zabel LLP, represents the  
Company in its restructuring efforts.


RCN CORP: Court Oks Kasowitz Benson as Debtors' Conflicts Counsel
-----------------------------------------------------------------
The United States Bankruptcy Court for the Southern District of
New York approved the employment of Kasowitz, Benson, Torres &
Friedman, LLP, as special conflicts counsel for RCN Corp. and its
debtor-affiliates' chapter 11 cases, effective as of Sept. 15,
2004.

Kasowitz Benson will provide legal representation on matters that
the Debtors' primary bankruptcy counsel, Skadden Arps Slate
Meagher & Flom, LLP, cannot provide due to a conflict, adverse
interest, or other connection. Additionally, Kasowitz Benson is
retained in connection with a significant claim asserted against
the Debtors' estates as to which the Firm has particular
expertise.

Kasowitz Benson is a law firm of more than 160 attorneys and has
been actively involved in numerous major Chapter 11 cases.
Deborah M. Royster, RCN Corporation's Senior Vice President,
General Counsel and Corporate Secretary, tells Judge Drain that
Kasowitz Benson is well qualified to serve as special conflicts
counsel in the Debtors' Chapter 11 cases.

The Debtors will compensate Kasowitz Benson for its services
based on the Firm's customary hourly rates:

         Members                   $475 - 775
         Counsel and Associates     200 - 525
         Paraprofessionals           90 - 200

The Firm will also be reimbursed for its actual and necessary
expenses incurred.

Kasowitz Benson will also render services on behalf of RCN's non-
debtor affiliates. These services will be billed directly to the
Non-Debtor Affiliates and not to the Debtors' estates.

In circumstances where the services are rendered to both the
Debtors and the Non-Debtor Affiliates, which are for the benefit
of both, Kasowitz Benson will allocate a proportional amount of
its fees and expenses for the services to the Non-Debtor
Affiliates, and will only seek payment from the Debtors' estates
of that portion allocated to the Debtors.

Aaron H. Marks, a member of Benson Kasowitz, assures the Court
that the Firm is a "disinterested person" as that term is defined
in Section 101(14) of the Bankruptcy Code, and does not hold any
interest adverse to the Debtors' estate.

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


SALOMON BROTHERS: Fitch Slices Class M-3 Rating to BB+ from BBB
---------------------------------------------------------------
Fitch Ratings has taken rating actions on these Salomon Brothers
Mortgage Securities (SBMS) VII, Inc. issues:

   * Salomon Brothers Mortgage Securities VII, Inc. asset-backed
     floating-rate certificates, series 1997-LB4

     -- Class M-3 upgraded to 'A' from 'BBB'.

   * Salomon Brothers Mortgage Securities VII, Inc. asset-backed
     floating-rate certificates, series 1997-LB5

     -- Class M-2 affirmed at 'A'.

   * Salomon Brothers Mortgage Securities VII, Inc. asset-backed
     certificates, series 1997-LB6

     -- Classes A-5, A-6 affirmed at 'AAA';
     -- Class B-1 upgraded to 'AAA' from 'AA';
     -- Class B-2 affirmed at 'A'.

   * Salomon Brothers Mortgage Securities VII, Inc. asset-backed
     certificates, series 1998-AQ1

     -- Classes A-5 - A-7 affirmed at 'AAA';
     -- Class B-1 affirmed at 'AA'.

   * Salomon Brothers Mortgage Securities VII, Inc. New Century
     asset-backed floating-rate certificates, series 1998-NC1

     -- Class A affirmed at 'AAA';
     -- Class M-1 affirmed at 'AA';
     -- Class M-2 affirmed at 'A'.

   * Salomon Brothers Mortgage Securities VII, Inc. New Century
     asset-backed floating-rate certificates, series 1998-NC2

     -- Class M-1 affirmed at 'AA';
     -- Class M-2 affirmed at 'A';
     -- Class M-3 affirmed at 'BBB'.

   * Salomon Brothers Mortgage Securities VII, Inc. New Century
     asset-backed certificates, series 1998-NC3

     -- Classes A-5, A-6 affirmed at 'AAA';
     -- Class M-1 affirmed at 'AA';
     -- Class M-2 affirmed at 'A';
     -- Class M-3 is downgraded to 'BB+' from 'BBB'.

   * Salomon Brothers Mortgage Securities VII, Inc. New Century
     asset-backed floating-rate certificates, series 1998-NC4

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

   * Salomon Brothers Mortgage Securities VII, Inc. New Century
     asset-backed floating-rate certificates, series 1998-NC6

     -- Class A affirmed at 'AAA';
     -- Class M-1 affirmed at 'AA';
     -- Class M-2 affirmed at 'A';
     -- Class M-3 affirmed at 'BBB'.

   * Salomon Brothers Mortgage Securities VII, Inc. asset-backed
     floating-rate certificates, series 1998-OPT1

     -- Class M-1 affirmed at 'AA';
     -- Class M-2 affirmed at 'A'.

   * Salomon Brothers Mortgage Securities VII, Inc. asset-backed
     floating-rate certificates, series 1998-OPT2

     -- Class M-1 affirmed at 'AA';
     -- Class M-2 affirmed at 'A'.

   * Salomon Brothers Mortgage Securities VII, Inc. floating-rate
     mortgage pass-through certificates, series 1999-AQ1

     -- Class M-1 upgraded to 'AAA' from 'AA';
     -- Class M-2 upgraded to 'AA' from 'A';
     -- Class M-3 upgraded to 'A' from 'BBB'.

   * Salomon Brothers Mortgage Securities VII, Inc. mortgage pass-
     through certificates, series 1999-NC1

     -- Class A-2 affirmed at 'AAA';
     -- Class M-1 affirmed at 'AA';
     -- Class M-2 affirmed at 'A';
     -- Class M-3 affirmed at 'BBB'.

   * Salomon Brothers Mortgage Securities VII, Inc. floating Rate
     mortgage pass-through certificates, series 1999-NC2

     -- Class M-1 affirmed at 'AA';
     -- Class M-2 affirmed at 'A';
     -- Class M-3 affirmed at 'BBB'.

   * Salomon Brothers Mortgage Securities VII, Inc. floating-rate
     mortgage pass-through securities certificates, series
     1999-NC3

     -- Class M-2 upgraded to 'AA' from 'A';
     -- Class M-3 affirmed at 'BBB'.


   * Salomon Brothers Mortgage Securities VII, Inc. mortgage pass-
     through certificates, series 1999-NC4

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

   * Salomon Brothers Mortgage Securities VII, Inc. floating-rate
     mortgage pass-through certificates, series 1999-NC5

     -- Class M-2 upgraded to 'AA' from 'A';
     -- Class M-3 affirmed at 'BBB'.

The upgrades reflect an increase in credit enhancement relative to
future loss expectations and affect approximately $170 millions in
total certificates.  The affirmations reflect credit enhancement
levels consistent with future loss expectations and affect
approximately $300 millions in total certificates.  The downgrade
of the M-3 bond of 1998-NC3 series affects approximately
$5 million outstanding as of October 25, 2004.

The M-3 bond of the 1997-LB4 series ($1,656,760 outstanding as of
the October 25, 2004 distribution date) currently benefits from
37.87% credit enhancement in the form of overcollateralization.  
The current pool factor (current mortgage loans outstanding as a
percentage of the initial pool) is 1.88%.

The B-1 bond of the 1997-LB6 series ($7,926,751 outstanding as of
the October 25, 2004 distribution date) currently benefits from
41.43% subordination.  The current pool factor is 7.61%.

The negative rating action on the M-3 bond of the 1998-NC3 series
($5,307,682 outstanding as of October 25, 2004), is due to the
worse than expected performance of the underlying collateral.  The
average monthly losses have been $249,087 over the past three
months and the average monthly excess interest during the same
period has been $120,134.  The net monthly losses ($249,987 -
$120,134) have averaged $128,953 over the past three months.  The
90+ delinquencies are currently 16.63% of the pool balance.

The current pool factor is 11.39%. As of the Oct. 25, 2004
distribution date, the OC was $1,712,880 with a stepped down
target of $2,370,000 -- OC floor.

The M-1 bond of the 1998-NC4 series ($2,750,054 outstanding as of
the October 25, 2004 distribution date) currently benefits from
69.58% subordination in addition to 13.56% credit enhancement in
the form of OC for a total credit enhancement of 83.14%.  The
current pool factor is 5.53%.

The M-1 bond of the 1999-AQ1 series ($32,181,727 outstanding as of
the Oct. 25, 2004 distribution date) currently benefits from
56.39% subordination in addition to 15.79% credit enhancement in
the form of OC for a total credit enhancement of 72.18%.  The M-2
bond ($36,531,000 outstanding as of the October 25, 2004
distribution date) currently benefits from 24.81% subordination in
addition to 15.79% credit enhancement in the form of OC for a
total credit enhancement of 40.60%.  The M-3 bond ($28,703,000
outstanding as of the October 25, 2004 distribution date)
currently benefits from 15.79% credit enhancement in the form of
OC.  The current pool factor is 11.08%.

The M-2 bond of the 1999-NC3 series ($8,698,665 outstanding as of
the October 25, 2004 distribution date) currently benefits from
33.54% subordination in addition to 26.07% credit enhancement in
the form of OC for a total credit enhancement of 59.61%.  The
current pool factor is 6.83%.

The M-2 bond of the 1999-NC4 series ($24,841,798 outstanding as of
the October 25, 2004 distribution date) currently benefits from
23.99% subordination in addition to 20.11% credit enhancement in
the form of OC for a total credit enhancement of 44.10%.  The
current pool factor is 8.69%.

The M-2 bond of the 1999-NC5 series ($26,994,949 outstanding as of
the October 25, 2004 distribution date) currently benefits from
36.45% subordination in addition to 19.29% credit enhancement in
the form of OC for a total credit enhancement of 55.74%.  The
current pool factor is 10%.


SHAW COMMUNICATIONS: Renews Normal Course Issuer Bid
----------------------------------------------------
Shaw Communications Inc. has received approval from The
Toronto Stock Exchange to renew its normal course issuer bid to
purchase its Class B Non-Voting Shares for a further one year
period. Shaw's normal course issuer bid, which was due to expire
on November 6, 2004, will now expire on November 7, 2005, in
accordance with the rules of the TSX.

Under Shaw's original issuer bid, commencing November 7, 2003,
Shaw has purchased an aggregate of 4,587,500 Class B Non-Voting
Shares at a weighted average price of $20.80. All such shares have
been cancelled.

As approved by the TSX, Shaw is now authorized to acquire up to an
additional 10,900,000 Class B Non-Voting Shares on or before
November 7, 2005, representing approximately 5% of the currently
issued and outstanding Class B Non-Voting Shares. The total number
of issued and outstanding Class B Non-Voting Shares of Shaw is
219,655,872.

Shaw continues to believe that its Class B Non-Voting Shares are
undervalued. The purchase and cancellation of outstanding Class B
Non-Voting Shares under the bid may represent an opportunity to
provide capital appreciation and market stability for the benefit
of Shaw's shareholders.

Class B Non-Voting Shares will be purchased by Shaw on the open
market through the facilities of the TSX pursuant to its rules
governing normal course issuer bids. The price that Shaw will pay
for any shares purchased pursuant to the bid will be the
prevailing market price for the shares on the TSX at the time of
such purchase. Any Class B Non-Voting Shares purchased back by
Shaw pursuant to the bid will be cancelled.

The bid does not apply to Class A Voting Participating Shares of
Shaw.

                        About the Company

Shaw Communications Inc. (S&P, BB+ Corporate Credit Rating,
Stable) is a diversified Canadian communications company whose
core business is providing broadband cable television, Internet
and satellite direct-to-home services to approximately 2.9 million
customers. Shaw is traded on the Toronto and New York stock
exchanges. Shaw is traded on the Toronto and New York stock
exchanges (Symbol: TSX - SJR.B, NYSE - SJR).


SITHE/INDEPENDENCE: Fitch Assigns BB Rating to Secured Debts
------------------------------------------------------------
Fitch Ratings placed the 'BB' rating of Sithe/Independence Funding
Corporation's secured notes and bonds on Rating Watch Negative.  
The rating action follows the recent announcement by Dynegy Inc.
(rated 'CCC+', Outlook Positive by Fitch) of the acquisition of
Sithe Energies, the indirect owner of the Sithe/Independence
project, from Exelon Corp. (rated 'BBB+' by Fitch).  Concurrent
with the acquisition, Exelon will purchase the remaining ownership
interests in Sithe Energies, giving Dynegy 100% ownership of the
Sithe/Independence project.

Fitch downgraded the securities from 'BBB-' to 'BB' in July 2002
due to the diminished credit quality of Dynegy Holdings Inc.,
(rated 'CCC+', Outlook Positive by Fitch) the guarantor of
contracts representing approximately 35% of Sithe/Independence's
revenues.  That rating action incorporated the concern of a
heightened risk of contractual default with the absence of
alternate offtake arrangements with pricing that would support
debt service with sufficient cushion to justify the former rating
level.

Fitch believes it unlikely that the current contracts guaranteed
by Dynegy Holdings will be modified as a result of the
acquisition.  The Rating Watch Negative action reflects the new
concerns that could result from the Sithe/Independence project
being wholly owned by an entity of speculative credit quality.
Provisions under the project documents, as well as the
organization structure and actions of Sithe Energies and the
Sithe/Independence project, provide certain protections to holders
of the securities.  The Rating Watch will be resolved once Fitch
has completed its review of these protections and the potential
effect from the change in ownership.


STEWART ENTERPRISES: Moody's Puts Low-B Ratings on Loans & Bonds
----------------------------------------------------------------
Moody's Investors Service assigned a Ba3 rating to the proposed
secured revolver and term loan B facility of Stewart Enterprises,
Inc.  Concurrently, Moody's affirmed the ratings on Stewart's
guaranteed senior subordinated notes and maintained a stable
ratings outlook.  The ratings benefit from the company's improved
recent financial performance, strong operating margins and large
backlog of preneed funeral and cemetery contracts.  The ratings
are constrained by significant leverage and industry challenges
including declining death rates and the trend towards lower
revenue and gross profit cremation services.

Moody's assigned these ratings:

   * $125 million revolving credit facility due 2009, rated Ba3;
   * $100 million term loan B, due 2011, rated Ba3.

Moody's affirmed these ratings:

   * $300 million guaranteed senior subordinated notes due 2008,
     rated B2;
   * Senior Implied, rated Ba3;
   * Senior Unsecured Issuer Rating, rated B1.

The ratings outlook is stable.

Moody's will withdraw these ratings upon closing of the proposed
credit facilities:

   * $175 million revolving credit facility due 2005, rated Ba3;
   * $63.6 million term loan B due 2005, rated Ba3.

Proceeds from the proposed credit facility are expected to be used
to refinance borrowings under Stewart's existing secured credit
facilities.

Stewart has completed asset sales in recent years, primarily
foreign operations and certain small domestic properties, to
reduce debt.  Debt levels have declined from about $694 million at
October 31, 2001 to about $437 million at July 31, 2004.  However,
Stewart's financial and operating performance weakened from 2001
through 2003.  Revenues from retained operations declined about
5% from the fiscal year ended October 30, 2001 to the fiscal year
ended October 31, 2003.  Despite the debt reductions, free cash
flow as a percentage of debt weakened.  Free cash flow from
operations (excluding non-recurring tax refunds) as a percentage
of debt in the fiscal years ended October 31, 2002 and 2003 and
the latest twelve month -- LTM -- period ended July 31, 2004 was
11%, 6% and 10%, respectively.  Free cash flow in each of the
periods reflects the payment of over $30 million in preneed
acquisition costs.

Stewart's financial performance over the last few years reflects
the challenges facing the death care industry.  The revenue
decline from 2001 to 2003 reflects pressure from decreases in
funeral services volume and preneed cemetery sales, a shift in
revenue mix toward cremations and weakness in trust earnings.  
Death rates in the United States have declined in the last few
years and may continue to decline in the near term.  In addition,
consumers are showing an increased preference for cremations,
which tend to generate lower revenues and gross profit per
service.  About 37% of the total funeral services the company
performs from continuing operations are cremation services.

Stewart has taken steps to improve its financial performance.  
Stewart has implemented various initiatives designed to improve
average revenue per funeral service, increase funeral events
performed, increase preneed cemetery property and preneed funeral
sales and reduce its cost structure.  In the nine month period
ended July 31, 2004, revenue increased about 3% versus the
comparable period in 2003 and gross margin improved to about
27% from about 24% in 2003.

Stewart's ratings benefit from the recent improvements in
financial performance, strong operating margins and a large
backlog derived from preneed funeral and cemetery contracts
supported by trust funds or third party insurance companies.

The stable ratings outlook reflects the expectation that the
company will experience stable revenues and margins and utilize
free cash flow from operations to pay down debt.  Moody's expects
that the company's strategic initiatives to improve revenues and
reduce costs will offset the impact of declining death rates and
increases in cremation rates.  The ratings or outlook would likely
benefit from a significant reduction in leverage or improvement in
free cash flow due to a sustained increase in revenues or
operating margins.  The ratings or outlook could be pressured if
the company increases leverage due to an acquisition or revenues
and margins decline due to decreases in funeral volume, increases
in cremation rates or further declines in trust performance.

Stewart's free cash flow to debt is weak within the Ba3 ratings
category, reflecting in part the company's significant payments
for preneed acquisition costs.  Free cash flow to debt for the LTM
period ended July 31, 2004 (excluding a $33 million tax refund)
was about 10%.  Total debt to EBITDA was approximately 2.6 times
for the LTM period.  For the LTM period, debt to revenues was high
at about 85% and EBITDA less capital expenditures coverage of
interest was approximately 3.1 times.

Stewart and two of its Puerto Rican subsidiaries will be borrowers
under the proposed credit facility.  The facility will be secured
by substantially all the assets of the company including the stock
of subsidiaries and excluding real estate and trust assets, which
had a combined book value in excess of $1 billion at
July 31, 2004.  The Ba3 rating reflects the credit facility's
senior position in the capital structure.  No notching above the
senior implied rating of Ba3 reflects the absence of tangible
asset coverage in a distress scenario, as well as the sizable
amount of senior secured debt in the capital structure (about 43%
of debt capitalization assuming a fully drawn revolver).  Pro-
forma for the proposed refinancing at July 31, 2004, approximately
$35 million is expected to be borrowed under the $125 million
revolver and approximately $15 million is reserved for letters of
credit.  Availability under the revolver is further reduced by the
amount that is bonded in the state of Florida (currently
$41 million).  Pro forma effective availability under the revolver
is about $34 million, down from about $50 million pursuant to the
existing credit facility.  Annual term amortization is expected to
remain minimal at roughly 1% per year.  Proposed financial
covenants will include maximum total and secured leverage ratios
and a minimum interest coverage ratio.  The maximum total leverage
covenant is expected to be increased from the existing credit
facility, providing the company with the flexibility to increase
total leverage.

The B2 rating confirmed for the senior subordinated notes reflects
their contractual subordination to senior debt.

Stewart Enterprises, Inc., headquartered in Jefferson, Louisiana,
is the third largest provider of funeral and cemetery services in
the United States.  For the LTM period ended July 31, 2004 revenue
from continuing operations was approximately $512 million.


STRUCTURED ASSET: Fitch Places Low-B Ratings on 10 Cert. Classes
----------------------------------------------------------------
Fitch Ratings upgrades 17 and affirms 26 classes of Structured
Asset Securities Corp. residential mortgage-backed certificates,
as follows:

   * Structured Asset Securities Corp., mortgage pass-through
     certificates, series 2002-AL1:

     -- Class A affirmed at 'AAA';
     -- Class B-1 affirmed at 'AA';
     -- Class B-2 affirmed at 'A';
     -- Class B-3 affirmed at 'BBB';
     -- Class B-4 affirmed at 'BB';
     -- Class B-5 affirmed at 'B'.

   * Structured Asset Securities Corp., mortgage pass-through
     certificates, series 2002-1A pool 1:

     -- Class 1A affirmed at 'AAA';
     -- Class B1-I upgraded to 'AAA' from 'AA';
     -- Class B2-I upgraded to 'AA' from 'A';
     -- Class B3-I upgraded to 'BBB+' from 'BBB';
     -- Class B4-I upgraded to 'BBB-' from 'BB';
     -- Class B5-I upgraded to 'BB' from 'B'.

   * Structured Asset Securities Corp., mortgage pass-through
     certificates, series 2002-1A pool 2:

     -- Class 2A affirmed at 'AAA';
     -- Class B1-II affirmed at 'AA';
     -- Class B2-II affirmed at 'A';
     -- Class B3-II upgraded to 'BBB+' from 'BBB';
     -- Class B4-II affirmed at 'BB';
     -- Class B5-II affirmed at 'B'.

   * Structured Asset Securities Corp., mortgage pass-through
     certificates, series 2002-1A pools 3, 4, and 5:

     -- Classes 3A, 4A, and 5A affirmed at 'AAA';
     -- Class B1-III upgraded to 'AAA' from 'AA';
     -- Class B2-III upgraded to 'AA' from 'A';
     -- Class B3-III upgraded to 'BBB+' from 'BBB';
     -- Class B4-III upgraded to 'BBB-' from 'BB';
     -- Class B5-III upgraded to 'BB+' from 'B'.

   * Structured Asset Securities Corp., mortgage pass-through
     certificates, series 2002-8A pools 1-6:

     -- Classes 1A, 2A, 3A, 4A, 5A, and 6A affirmed at 'AAA';
     -- Class B1-I upgraded to 'AA+' from 'AA';
     -- Class B2-I upgraded to 'A+' from 'A';
     -- Class B3-I affirmed at 'BBB';
     -- Class B4-I upgraded to 'BB+' from 'BB';
     -- Class B5-I upgraded to 'BB' from 'B'.

   * Structured Asset Securities Corp., mortgage pass-through
     certificates, series 2002-8A pool 7:

     -- Class 7A affirmed at 'AAA';
     -- Class B1-II upgraded to 'AA+' from 'AA';
     -- Class B2-II upgraded to 'A+' from 'A';
     -- Class B3-II affirmed at 'BBB';
     -- Class B4-II affirmed at 'BB';
     -- Class B5-II affirmed at 'B'.

The upgrades reflect a substantial increase in credit enhancement
relative to future loss expectations and affect $379,848,614 of
outstanding certificates.  The affirmations reflect credit
enhancement consistent with future loss expectations and affect
$887,093,157 of outstanding certificates.

As of the Sept. 25, 2004 distribution, the senior class A
certificates of series 2002-AL1 are benefiting from 15.67%
subordination (up from 10.86% as of the closing date,
March 8, 2002) provided by classes B1 to B5 and the not rated
class B6.  The current credit enhancement of classes B1, B2, B3,
B4, and B5 is 11.73%, 8.72%, 6.46%, 4.59%, and 3.13%,
respectively, compared with 8.16%, 6.11%, 4.56%, 3.28%, and 2.28%
as of closing.  Currently, 40% of the collateral has paid down.

As of the September 25, 2004 distribution, the senior class A
certificates of series 2002-1A pool 1 are benefiting from 17.35%
subordination (up from 4.50% as of the closing date,
January 30, 2002) provided by classes B1-I to B5-I and the not
rated class B6-I.  The current credit enhancement of classes B1-I,
B2-I, B3-I, B4-I, and B5-I is 10.73%, 6.85%, 4.32%, 2.57%, and
1.79%, respectively, compared with 2.80%, 1.80%, 1.15%, 0.70%, and
0.50% as of closing.  Currently, 86% of the collateral has paid
down.

As of the September 25, 2004 distribution, the senior class A
certificates of series 2002-1A pool 2 are benefiting from 13.35%
subordination (up from 6.25% as of the closing date,
January 30, 2002) provided by classes B1-II to B5-II and the not
rated class B6-II.  The current credit enhancement of classes B1-
II, B2-II, B3-II, B4-II, and B5-II is 8.83%, 5.93%, 3.56%, 2.48%,
and 1.73%, respectively, compared with 4.15%, 2.80%, 1.70%, 1.20%,
and 0.85% as of closing.  Currently, 57% of the collateral has
paid down.

As of the September 25, 2004 distribution, the senior class A
certificates of series 2002-1A pools 3, 4, and 5 are benefiting
from 18.74% subordination (up from 3.25% as of the closing date,
Jan. 30, 2002) provided by classes B1-III to B5-III and the not
rated class B6-III.  The current credit enhancement of classes
B1-III, B2-III, B3-III, B4-III, and B5-III is 12.40%, 7.50%,
4.04%, 2.89%, and 2.03%, respectively, compared with 2.15%, 1.30%,
0.70%, 0.50%, and 0.35% as of closing.  Currently, 93% of the
collateral has paid down.

As of the September 25, 2004 distribution, the senior class A
certificates of series 2002-8A pools 1-6 are benefiting from
10.00% subordination (up from 5.00% as of the closing date,
April 30, 2002) provided by classes B1-I to B5-I and the not rated
class B6-I.  The current credit enhancement of classes B1-I, B2-I,
B3-I, B4-I, and B5-I is 5.40%, 3.20%, 2.00%, 1.85%, and 1.82%,
respectively, compared with 2.70%, 1.60%, 1.00%, 0.60%, and 0.30%
as of closing.  Currently, 84% of the collateral has paid down.

As of the September 25, 2004 distribution, the senior class A
certificates of series 2002-8A pool 7 are benefiting from 11.94%
subordination (up from 6.00% as of the closing date, April 30,
2002) provided by classes B1-II to B5-II and the not rated class
B6-II.  The current credit enhancement of classes B1-II, B2-II,
B3-II, B4-II, and B5-II is 6.47%, 3.98%, 2.69%, 1.69% and 0.80%,
respectively, compared with 3.25%, 2.00%, 1.35%, 0.85%, and 0.40%
as of closing.  Currently, 50% of the collateral has paid down.


SUN HEALTHCARE: Revised Sept. 30 Balance Sheet Shows $119M Deficit
------------------------------------------------------------------
Sun Healthcare Group, Inc. (NASDAQ: SUNH) reported that the
financial information expressed in its press release of Nov. 2,
2004, will be adjusted to reflect a change in its auditor's
guidance regarding the Company's application of FASB
Interpretation No. 46.  The Company previously recognized the
effect of consolidating the real estate ownership of nine
facilities, due to an option agreement giving the other equity
owners of the real estate the right to sell their interest to the
Company, as a cumulative effect of change in accounting principle,
which increased the Company's net income by $11.9 million.

Based upon additional discussion and guidance from its auditors,
the Company has now determined that the effect of the option
agreement should have been recognized as a reduction in the
carrying value of the nine facilities and, accordingly, the
cumulative effect of change in accounting principle should not
have been recorded.  The revised application of FIN 46 results in
a $4.8 million improvement in the Company's balance sheet versus
the $13.1 million originally reported.  The adjustment has a
recurring effect on positive quarterly EBITDA of approximately
$0.8 million, as well as additional depreciation and interest
charges totaling $1.3 million.  Those impacts therefore remain as
previously reported.

The revision to the Company's application of FIN 46 will not
change the Company's results from continuing operations nor alter
the guidance stated in the Nov. 2, 2004 press release as to
revenues, EBITDAR, and EBITDA.  The elimination of the previously
reported non-cash $11.9 million cumulative effect of change in
accounting principle causes the Company's net income in the third
quarter to be reduced by $11.9 million from $0.8 million to a loss
of $11.1 million.  That adjustment also affects the net income for
the nine months ended Sept. 30, 2004 and the Company's guidance as
to net income by the same amount.

                  About Sun Healthcare Group, Inc.

Sun Healthcare Group, Inc., with executive offices located in
Irvine, California, owns SunBridge Healthcare Corporation and
other affiliated companies that operate long-term and postacute
care facilities in many states.  In addition, the Sun Healthcare
Group family of companies provides therapy through SunDance
Rehabilitation Corporation, medical staffing through CareerStaff
Unlimited, Inc., home care through SunPlus Home Health Services,
Inc., and medical laboratory and mobile radiology services through
SunAlliance Healthcare Services, Inc.

At Sept. 30, 2004, Sun Healthcare's revised balance sheet showed a
$119,041,000 stockholders' deficit, compared to a $166,398,000
deficit at Dec. 31, 2003.


TEXAS STATE: Moody's Pares Subordinate Revenue Bond Rating to Ba3
-----------------------------------------------------------------
Moody Investors Service downgraded the rating of Texas State
Affordable Housing Corporation Multifamily Housing Revenue Bonds
(Housing Initiatives Corporation - Arborstone/Baybrook/Crescent
Oaks Development) Senior Series 2001A&B to Baa3 from Baa1 and
Subordinate Series 2001C to Ba3 from Ba1.  The outlook for the
ratings is negative.  The bonds are are currently on watchlist.

The underlying rating downgrades reflects a lower then anticipated
rental revenue stream, as evidenced by a current debt service
coverage ratio of 1.22x on the senior bonds and 1.09x on the
subordinate bonds from monthly unaudited financial statements as
well as annualized projections on the properties.  The ratings
have been downgraded due to the weakened financial performance of
the properties compared with projected debt service coverage
levels.  When the transaction was rated in 2001, the bonds were
underwritten to achieve 1.40x debt service coverage on the Senior
Series 2001A and B, 1.25x debt service coverage on the Subordinate
Series 2001C.  The bonds are secured by the revenues from three
cross collateralized properties, Arborstone Apartments, Baybrook
Apartments and Crescent Oaks Apartments, as well as by funds and
investments pledged to the trustee under the indenture as security
for the bonds.

Vacancy and dwelling adjustments reflecting concessions, loss to
lease, non-revenue units, delinquencies and past due collections
have increased signficantly with the Arborstone and Baybrook
properties.  In addition to the decline in occupancy, Arborstone
has recently suffered damage attributable to a fire.  The damage
has left one building of eight units uninhabitable.  While the
displaced tenants have been moved to adjacent units and rent
continues to be collected, the currently vacant units have been
set aside for the displaced tenants of the other units.  This is a
serious impediment to any quick turnaround in Arborstone's overall
occupancy.  Arborstone together with Baybrook account for 76% of
the apartment pool (1,312 units).  Occupancy levels for Arbostone
has hovered around the low 80 percentiles for the past year, while
Baybrook has slowly increased to a current 86%.  Crescent Oaks
(429 units)continues to exhibit strong and stablized occupancy.  
As of 11/1/04 occupancy levels for Arborstone, Baybrook and
Crescent Oaks were 83%, 86% and 93% respectively.  In an effort to
reach higher occupancy and underwriittn rent levels, HIC has
proactively implemented changes in property managers.  Asset Plus
who is property manager for Crescent Oaks is now also managing
Baybrook.  Myan managment has been contracted to manage
Arborstone.

The erosion of debt service coverage levels is a direct result of
a decline in rental revenues as exhibited in increased vacancies.  
While the Arborstone/Baybrook/Crescent Oaks Apartment Pool has
continued to generate rental revenues suffice to pay debt service,
they have been experiencing some softness in the market.  As
previously reported, the Baybrook property in Webster, Texas and
the Arborstone property in Dallas have been most affected.  
Webster has experienced some softness in the market as reflected
in the performance of the Baybrook property.  Baybrook accounts
for 776 units of the 1741 unit apartment pool (approximately 44%).
Webster has recently suffered job loss due to closures of large
retail establishments such as Walmart and Best Buy.  The affect of
these closures has trickled down to the rental market of Webster,
as evidenced by the fluctuating occupancy of the Baybrook
Apartments project.  The unemployment rate of Webster and Dallas
continue to have a negative impact on stablized occupancy and
collected rents.  Strong marketing and concessions are in place
and occupany has already inrementally increased.  Utlity expenses
and insurance premiums in particular, continue to rise, exerting
downward pressure on the net operating income on all three
properties.  While high insurance premiums continue to be the
norm, Asset Plus, Myan and KPE Development management companies
continue to shop for competitive rates in this market.

Arborstone Apartments (Dallas): a 536-unit garden style apartment
complex constructed in 1983 on a 24.5 acre site located in the
southern section of the City of Dallas.  The property, comprised
of 36 two and three-story structures of wood frame construction on
concrete slab foundations, is located in a moderate-income area of
older commercial and residential development.  Project amenities
include three swimming pools, a playground, a tennis court, an
exercise room, laundry facilities, and mature landscaping.  At
this time Arborstone is undergoing repairs to fire units.

Baybrook Village Apartments (Webster): a 776-unit garden style
project constructed in 1980-81 on a 25 acre site located in the
City of Webster, which lies in the southeastern part of the
Houston metropolitan area.  The complex is comprised of 52 two-
story buildings of wood frame and brick veneer construction on
concrete slab foundations.  The submarket is generally comprised
of moderate-middle income residents, and land uses consist
primarily of newer residential/commercial developments.  
Significant residential demand generators include the nearby
Johnson Space Center, local malls, and Hobby Airport.  Project
amenities include four swimming pools, 2 spas, exercise room, and
laundry facilities.  At this time Baybrook is planning the
installation of a new irrigation system around the perimeter of
the community development.

Crescent Oaks Apartments (Houston): a 429-unit garden style
apartment complex constructed on 15.5 acres in 1969-70.  The
complex is comprised of 46 two and three-story buildings of wood
frame and brick veneer construction on concrete slab foundations.  
Crescent Oaks is located in a low-moderate income neighborhood
located about 10 miles northwest of downtown Houston.  The
submarket consists of generally older construction of mixed
commercial/residential uses, developed primarily from the 1950's
through the 1970's.  Amenities at Crescent Oaks include three in-
ground swimming pools, playgrounds, a sports court, and laundry
facilities.

The current outlook is negative for the Senior and Subordinate
Bonds and the bonds remain on watch.  This reflects the soft
market environment of the properties, debt service coverage levels
continuing to trend negatively and prolonged vacnacies in the
pooled apartment units.


THOMSON MEDIA: Moody's Assigns Single-B Ratings to Loan Pacts
-------------------------------------------------------------
Moody's Investors Service assigned first-time ratings to Thomson
Media Inc. following the announcement that Investcorp, a private
equity firm, has acquired the company from Thomson Corporation (A3
senior unsecured) for $350 million, a 10.4x EBITDA multiple (last
twelve months as of September 30, 2004).  Proceeds from the
financing, in addition to $160 million in private equity and
$17 in senior notes issued at Thomson Media Holdings that will be
contributed to Thomson Media as equity, will be used to fund the
acquisition.

The ratings are:

   * B1 -- $35 million first lien senior secured revolving credit
     facility due 2010 (expected to be undrawn at closing)

   * B1 -- $160 million first lien senior secured term loan B, due
     2011

   * B2 -- $40 million second lien senior secured term loan C due
     2012

   * B1 -- Senior Implied rating

   * B3 -- Senior Unsecured Issuer rating

The rating outlook is stable.

The ratings reflect Thomson Media's high financial leverage and
Moody's belief that the company is dependent upon a weakened
business-to-business (B2B) advertising sector and could face
potential operating and capital investment risks associated with
the electronic disintermediation of print media.  The ratings are
supported by the company's high quality financial publications,
including "American Banker" and "The Bond Buyer", with strong
competitive positions and fairly wide circulation, an experienced
management, adequate liquidity, positive free cash flow and a
recent improvement in organic revenue growth following one of the
worst recessions in B2B advertising spending history.

The stable rating outlook reflects Moody's belief that Thomson
Media will continue to experience top-line organic revenue growth
following an industry-wide decline in B2B publishing revenue.
Until 2004, Thomson Media, as a business segment of Thomson
Corporation, had experienced 4.1% average annual revenue declines
from 2000-2003, which still outpaced most of its competitors, due
to the challenging economic environment.  However, in view of the
recent improvement in the economy in 2004, Moody's estimates
Thomson Media's revenue growth will improve by 3-4% and EBITDA
margins will improve from 16.7% in 2003 to 19% this year.  Moody's
believes this trend will continue given the leveling off of
circulation erosion at many of its flagship publications since
2003.

Given the high financial leverage, Moody's believes the company is
weakly positioned in the rating category.  Therefore, the stable
outlook is predicated on improvement in debt protection measures
and the maintenance of significant liquidity through internally
generated free cash flow, which benefits significantly from the
pre-payment of subscriptions, and availability under the $35
million revolver.  In 2004, pro-forma for the proposed financing,
Moody's expects that Thomson Media's financial leverage will be a
relatively high 6.7x total adjusted debt-to-EBITDAR, approximately
9% free cash flow to total debt and EBITDA less capex total
interest coverage of 2.2x. By the end of 2006, Moody's expects
financial leverage will improve to below 6.0x total adjusted
debt-to-EBITDAR, debt-to-free cash flow will improve and then
remain above 10% and EBITDA less capex total interest coverage
will also improve and remain above 2.5x.

Moody's anticipates that positive ratings pressure is only likely
over the extended rating horizon should the company demonstrate
operating improvements, as evidenced by EBITDA operating margins
that consistently exceed 20% and a strengthened balance sheet, as
evidenced by adjusted debt-to-EBITDAR well under 5.0x, free cash
flow to debt well above 10% and EBITDA less capex total interest
coverage above 3.0x, all on a sustained basis.  Alternatively, if
the company is unable to meet Moody's expected performance levels
and the B2B operating environment were to worsen, the rating
outlook and/or the company's ratings would likely face downward
pressure.

The senior implied rating resides with Thomson Media Inc., as the
highest issuer of rated debt in the corporate structure.  However,
the rating recognizes that Thomson Media's parent, Thomson
Holdings, will issue approximately $17 million in senior notes,
whose coupon may be paid in cash or added to the outstanding
principal, the proceeds of which will be invested in the
subsidiary as equity.  While initially, Investcorp intends to
invest approximately $160 million in equity, ultimately, Moody's
expects the senior notes at the parent will need to be refinanced
or serviced by a distribution from the subsidiary.

Moody's has rated the first-lien bank debt at parity with the
senior implied rating as it represents the bulk of the debt
capital structure.  The rating for the $40 million second lien
facility is notched down from the first-lien debt rating in
recognition of the substantial amount of first-lien debt that
ranks ahead of it, and the view that this layer of capital may
have some equity-like risk associated with it in a downside
scenario.  In the event of a default, second-lien lenders may only
pursue recovery action once first-lien holder claims have been
fully satisfied.  In addition to a priority lien on the collateral
security, in the first 180 days following default, the first-lien
debt holders have the sole right to negotiate up to $50 million in
debtor-in-possession financing and the right to receive post-
petition interest without having to obtain the consent of the
second-lien debt holders

Senior secured lenders, which includes both the first and second-
lien debt holders, will receive a perfected security interest in
the stock of Thomson Media and each of its operating subsidiaries
and substantially all tangible and intangible assets, most
importantly the company's high quality brands.  Financial
covenants are meant to limit indebtedness through maximum debt-to-
EBITDA leverage and minimum EBITDA interest coverage levels.  In
addition, the bank definition of EBITDA is adjusted to reflect the
pro-forma results of any acquired businesses, and also to exclude
certain non-recurring items.

Moody's believes the company will delever its balance sheet given
the moderate level of projected free cash flow over the
intermediate term and a 50% excess cash flow sweep commencing in
fiscal 2005.  However, Moody's believes the pace of debt repayment
could slow if the company needs to invest additional capital in
its technology infrastructure given Moody's opinion that
electronic distribution is quickly becoming the fastest growing
information platform in the B2B industry.

Thomson Media Inc., headquartered in New York City, is a leading
provider of multimedia information to professionals in the
banking, financial services and related technology markets.  Its
flagship publications include "American Banker", "The Bond Buyer"
and "Investment Dealer's Digest".  For the 12 months ending
September 30, 2004, the company generated $175 million and
$33.2 million in revenue and adjusted EBITDA, respectively.


TRUMP HOTELS: Releases Details on $100MM DIP Loan Beal's Arranging
------------------------------------------------------------------
With lots of compliments from Chairman & CEO Donald J. Trump and
President & COO Scott C. Butera, Trump Hotels & Casino Resorts,
Inc., disclosed last week that it selected Beal Bank, S.S.B., as
the sole lead arranger for a $100 million interim financing
arrangement.  That arrangement is a $100 million debtor-in-
possession, senior secured, revolving loan facility.  

Trump Hotels & Casino Resorts, Inc., Trump Atlantic City
Associates, Trump Casino Holdings, LLC, and their wholly owned
domestic subsidiaries, as debtors and debtors-in-possession, are
the Borrowers.  The facility matures by its own terms on the
Effective Date of a confirmed chapter 11 plan.  Loans bear
interest at LIBOR plus 1.5%.  The fees Trump will pay Beal are set
forth in a Fee Schedule the parties haven't made public.  All
borrowings under the DIP Facility will be accorded superpriority
claim status in Trump's to-be-commenced bankruptcy cases and will
secured by:

    * Section 364(d) liens and security interests having priority
      over the liens securing the 11.25% TAC notes and the 11-5/8%
      first priority TCH mortgage notes and the 17-5/8% second
      priority TCH mortgage notes in all existing and after-
      acquired assets (including all real property, personal
      property or otherwise) of each Borrower, including without
      limitation, the properties commonly known as Trump Taj
      Mahal, Trump Plaza, Trump Marina and Trump Indiana, all
      accounts receivable, inventory, equipment, contracts,
      intellectual property (including trademarks), investment
      property and general intangibles (excluding causes of
      action arising under Chapter 5 of the Bankruptcy Code, and
      all products and proceeds of the foregoing (including
      insurance proceeds), whether now owned or hereafter
      arising; and

    * Liens pursuant to Sections 364(c)(2) and (c)(3) of the
      Bankruptcy Code that are junior to all other valid,
      perfected and non-avoidable pre-petition liens in all
      existing and after-acquired assets, including the Casinos
      but excluding Chapter 5 avoidance actions.

Beal agrees to a Carve-Out from its liens -- in an amount to be
determined -- that will allow for payment of the professionals'
fees and fees payable to the U.S. Trustee and court clerk in the
event of a default.  

Before Beal will lend a dime, an executive officer of each
Borrower must deliver a certificate stating that the trailing 12-
month EBITDA is not less than $150,000,000 in the aggregate for
TCH and TAC on a consolidated basis or $125,000,000 for TAC on a
standalone basis, measured as of the most recent quarterly test.

                         About Beal Bank

Beal Bank was founded in 1988 and is designated a wholesale bank.
Beal Bank is headquartered near Dallas, Texas, with affiliate
offices in New York City, Las Vegas, and California. With
commercial real estate financing as its core business, Beal Bank's
capitalization has grown to over $1.5 billion as of June 30, 2004,
with assets of more than $7.0 billion in numerous industries
including aircraft, power, timber, retail and gaming.

Beal Bank traditionally provides fixed assets financing with
limited or no financial covenants. Syndication risk is eliminated
due to Beal Bank's ability to solely fund its loans and hold them
to maturity.

               About Trump Hotels & Casino Resorts

Through its subsidiaries, Trump Hotels & Casino Resorts, Inc.,
owns and operates four properties and manages one property under
the Trump brand name. Trump Hotels' owned assets include Trump
Taj Mahal Casino Resort and Trump Plaza Hotel and Casino, located
on the Boardwalk in Atlantic City, New Jersey, Trump Marina Hotel
Casino, located in Atlantic City's Marina District, and the Trump
Casino Hotel, a riverboat casino located in Gary, Indiana. In
addition, the Company manages Trump 29 Casino, a Native American
owned facility located near Palms Springs, California. Together,
the properties comprise approximately 451,280 square feet of
gaming space and 3,180 hotel rooms and suites. The Company is the
sole vehicle through which Donald J. Trump conducts gaming
activities and strives to provide customers with outstanding
casino resort and entertainment experiences consistent with the
Donald J. Trump standard of excellence. Trump Hotels is separate
and distinct from Mr. Trump's real estate and other holdings.

As reported in the Troubled Company Reporter on October 22, 2004,
Trump Hotels & Casino Resorts, Inc., Donald J. Trump and holders
of approximately 57% of Trump Atlantic City Associates' First
Mortgage Notes due 2006, approximately 68% of Trump Casino
Holdings, LLC's First Priority Mortgage Notes due 2010 and
approximately 81% of Trump Casino Holdings, LLC's Second Priority
Notes due 2010 entered into a support agreement in connection with
the recapitalization of the Company pursuant to a plan of
reorganization.

As part of the Plan, Donald J. Trump, who will remain the
Company's Chairman and Chief Executive Officer, will invest
approximately $71.4 million into the recapitalized Company.
Mr. Trump's investment will consist of a $55 million cash equity
investment and the conversion of approximately $16.4 million
principal amount of TCH Second Priority Notes owned by him into
shares of the recapitalized Company's common stock. Upon
consummation of the Plan, Mr. Trump is expected to remain the
largest individual stockholder of the Company, with beneficial
ownership of approximately 27% of the Company's common stock.


TW, INC.: Wants Solicitation Period Stretched to Jan. 31
--------------------------------------------------------
TW, Inc., and its debtor-affiliates ask the U.S. Bankruptcy Court
for the District of Delaware for an extension of their exclusive
period in which to solicit acceptances of a liquidating chapter 11
plan through January 31, 2005.  

The Debtor liquidated its inventory and closed the doors of THE
WIZ for good in early 2003.  THE WIZ, a subsidiary of GBO
Electronics Acquisition, LLC, was a premier consumer electronics
retailer in the New York-New Jersey-Connecticut tri-state area.  
The Debtors' plan is simple: distribute the proceeds of the
liquidation sale to creditors in order of their statutory
priority.  A battle between the Debtors and their creditors over
intercompany claims has stalled progress toward confirmation of
that liquidating plan and mediation attempts failed.  Creditors
owed $40 million don't want to share a pro-rata 12% distribution
with the holder of a $90 million intercompany claim.  

The Debtors are hopeful that more time will result in a consensual
resolution of the dispute.  

Judge Walrath will consider the Debtor's request at a Nov. 30
hearing.  Objections, if any, must be filed and served by Nov. 23.

TW, Inc., filed for chapter 11 protection on March 14, 2003
(Bankr. Del. Case No. 03-10785).  Jeremy W. Ryan, Esq., and Mark
Minuti, Esq., at Saul Ewing LLP represent the Debtors.  When the
Company filed for protection from its creditors, it listed assets
of over $50 million and debts of more than $100 million.


UAL CORP: Gets Interim Extension to File Plan Until December 1
--------------------------------------------------------------
As reported in the Troubled Company Reporter on Oct. 4, 2004,
Judge Wedoff extends UAL Corporation and its debtor-affiliates'
eriod within which they have the exclusive right to file a
Plan until November 1, 2004.

The Debtors' request is continued to the November 19, 2004
hearing.  In the interim, Judge Wedoff extends the Debtors'
exclusive period to file a plan through December 1, 2004.  The
Debtors have through January 31, 2004, to seek acceptance of that
plan.

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


UAL CORP: Gets Court Nod to Reject Four Aircraft Leases
-------------------------------------------------------
As reported in the Troubled Company Reporter on Oct. 8, 2004, UAL
Corporation and its debtor-affiliates sought the Court's authority
to reject leases for four Boeing 737-300 Aircraft and related
Engines.  The Aircraft bear Tail Nos. N316UA, N317UA, N353UA and
N368UA.

United Air Lines, Inc., entered into the Leases as part of the
so-called Leveraged Lease Financing arrangements. The lessor is a
common law trust that holds the legal title to the equipment on
behalf of various equity participants.  An Indenture Trustee holds
a security interest in the relevant pieces of equipment on behalf
of lending parties to the financing arrangement.

According to James H.M. Sprayregen, Esq., at Kirkland & Ellis, in
Chicago, Illinois, the Debtors need to maximize their fleet
utility at the lowest possible cost. Mr. Sprayregen reports that
the Debtors analyzed several aircraft financings and considered
the financing structure and related equipment in light of the
projected demand for air travel, flight schedules, maintenance
requirements, labor costs and other business factors. After
careful review, the Debtors determined that they have an excess
supply of 737-300 aircraft in their fleet. The rate under the
leases exceeds the current market value and the payment
obligations far outweigh the benefits that the Debtors receive
from using the Aircraft. As a result, the Aircraft are burdensome
to the estates.

Mr. Sprayregen tells the Court that the Owner Trustee for all four
Aircraft is Wilmington Trust Company. The Aircraft are parked at
Southern California Aviation in Victorville, California.

                          *     *     *

Judge Wedoff grants the Debtors' request.

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


UNITED AIRLINES: Flight Attendants Balk at New Concession Demands
-----------------------------------------------------------------
United Airlines declared war on its employees Friday, proposing
cuts in wages, benefits and work rules. The Association of Flight
Attendants-CWA United Airlines Master Executive Council received
the latest litany of United Airlines' demand for concessions that
totals $137,614,000 annually. This demand is over and above the
annual $314 million already sacrificed by flight attendants and
the hundreds of millions of dollars United's management intends to
extract from employees by terminating their pension plans. The
union promised to fight the company 'over every dime.'

Greg Davidowitch, president of the United Airlines Flight
Attendant Master Executive Council, made the following statement
regarding United's demands:

"The company's demands are disastrous. If management stands by
these stipulations, they will destroy United Airlines. We're not
going to let that happen. We will fight them at the bargaining
table and we will fight them in court. AFA will not stand by and
let management destroy the flight attendant career and United
Airlines.

"The devastating effects these proposed changes will visit upon
the flight attendants are not the product of real need but
managements' desire. What is most tragic about what the company is
attempting to do is that it will be viewed by many if not most of
our members as a plan of employee liquidation. The company's
demands from flight attendants are not fair, equitable nor
necessary for a successful reorganization. Management and their
lawyers are doing this because they think they can get away with
it under the protection of bankruptcy."

The leadership of the United flight attendants will convene a
special meeting beginning Friday, November 12, 2004.

More than 46,000 flight attendants, including the 21,000 flight
attendants at United, join together to form AFA, the world's
largest flight attendant union. AFA is part of the 700,000 member
strong Communications Workers of America, AFL-CIO. Visit us at
http://www.unitedafa.org/

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 ONLINE: Moody's Rates Planned $150M Senior Secured Loan B1
-----------------------------------------------------------------
Moody's Investors Service has assigned a B1 senior implied rating
and a SGL-2 speculative grade liquidity rating for United Online,
Inc., as well as a B1 rating for the proposed $150 million four-
year senior secured term loan.  Proceeds from the transaction and
cash on hand will finance the company's tender offer for
approximately $154 million (including fees) or 27% of the
company's outstanding common stock.

The ratings reflect the substantial business risk of the dial-up
ISP market, characterized by an eroding aggregate subscriber base,
competition from other ISP providers and larger cable and telco
providers for subscribers, and integration risk inherent in
United's acquisition of Classmates.com, a company approximately
44% the size of United (based on paying subscribers).  These risks
are offset by the company's relatively conservative financial
profile and competitive position.  The rating outlook is stable.
This is the first time that Moody's has rated United Online.

Moody's assigned these ratings:

   -- a B1 senior implied rating,

   -- a B1 rating to the proposed $150 million senior secured term
      loan,

   -- a B3 senior unsecured issuer rating,

   -- a SGL-2 speculative grade liquidity rating

The rating outlook is stable.

The B1 senior implied rating incorporates the concentration of
United's business in one service offering, subscription dial-up
Internet access, a commodity product.  Moody's believes that in
the short-term United Online will maintain a competitive advantage
as a value-priced Internet access provider.  Longer-term we
question the sustainability of this price advantage, as larger
providers begin to target the lower-income market segment to
maintain their existing market share.  Maintaining profitable
growth may also prove challenging as higher marketing outlays
(i.e. TV and off-line advertising) and other operating expenses
accompany the fight for subscribers.  Other operating risks
include United's exposure to an unreliable advertising revenue
stream (10% of LTM revenues down from 16% in 2002).  As an
Internet access provider, advertising is not United's strategic
focus, and thus the company is likely to continue to lose this
revenue base to more compelling media formats.  The ratings also
assume that in a distressed scenario, the coverage provided to
secured lenders is likely to provide only modest cushion given the
commodity nature of the product as well as the high proportion of
intangible assets.

Positive factors supporting the ratings include United's
significant brand value, leading competitive position in the
discount ISP segment, a stable and recurring revenue stream,
conservative financial profile (pro forma for the transaction and
Classmates acquisition, about 1.2x total debt-to-EBITDA, 2004
estimate), management's track record for converting free-based
customers to pay subscriptions, and opportunities for further
growth in the value-priced dial-up segment.  With the acquisition
of Classmates.com, United diversifies its cash flow stream with a
complementary asset to its existing free and pay subscription
base.  Moreover, it provides United Online with an additional
vehicle for growth through the cross-selling of service offerings
to the Classmates subscriber base.

The stable outlook incorporates the company's attractive margins
and strong liquidity.  It also reflects Moody's expectation that
United will achieve improvements in leverage as the company uses
excess free cash flow to pay down debt instead of returning
additional cash to equity holders, and will be conservative in the
financing of future acquisitions.  Upward rating momentum might
occur if Moody's believed United's business risk was mitigated by
a less competitive operating environment and/or by greater than
expected profitable growth from the Classmates acquisition.  
Downward pressure on the ratings would likely result from
increased competition in the dial-up ISP market, a lack of
profitable subscriber growth, or an inability to achieve synergies
from the Classmates acquisition.

The senior secured credit facility is guaranteed by all of the
direct and indirect subsidiaries of the company.  It benefits from
a first priority perfected security interest in all of the stock
and other tangible and intangible assets of the borrower, the
parent, United Online, and any subsidiary guarantor.  The senior
first priority secured term loan is the only debt in the firm's
capital structure.

United's SGL-2 rating reflects the company's "good" liquidity
profile as projected over the next twelve months, reflecting the
strong free cash flow generating ability and substantial cash
balances.  Pro forma for the debt issuance and Classmates
acquisition, Moody's expects United to have liquidity of
approximately $142 million, comprised mostly of cash balances and
operating cash flow.  United Online continues to be able to fund
its core operating expenditures, including modest capital
investments, with cash flow, and is expected to remain comfortably
in compliance with its bank financial covenants.  In addition,
United Online is likely to continue to build cash.  While the
absence of readily monetizeable assets and the lack of a liquidity
facility somewhat impede financial flexibility, United's pro forma
cash position of $125 million provides more than ample coverage to
fund the $35 million in near-term amortization payments due under
the term loan.  Pro forma for the proposed debt issuance, United's
total debt is about 1.4 times debt-to-EBITDA and pro forma
interest coverage is about 15 times for the last twelve months
ended September 30, 2004.

United Online, Inc., headquartered in Woodland Hills, California,
is a leading provider of consumer Internet subscription services.


UNIVERSAL ACCESS: Wants 6 More Months to Propose a Chapter 11 Plan
------------------------------------------------------------------
Universal Access Global Holdings, Inc., wants its exclusive right
to propose and file a chapter 11 plan extended by six months.  The
Debtor asks the U.S. Bankruptcy Court for the Northern District of
Illinois to extend, pursuant to 11 U.S.C. Sec. 1121, its exclusive
right to file a plan through June 3, 2005, and grant a concomitant
extension of its exclusive period to solicit acceptances of that
plan through August 3, 2005.

The Debtor has recently hired Daniels & Associates, L.P., as its
investment banker to organize asset sales.  "It would be premature
to file a plan until knowing how a successful buyer would want to
proceed," the Debtor tells the Bankruptcy Court.  

The Honorable Jack B. Schmetterer will convene a hearing in
Chicago on Nov. 12 to review the Debtor's request.  Objections, if
any, must be filed and served by Nov. 9.

Judge Schmetterer previously granted the Debtor an extension of
its time to elect to assume, assume and assign, or reject
unexpired nonresidential real property leases and executory
contracts through April 1, 2005.

Headquartered in Chicago, Illinois, Universal Access Global
Holdings, Inc. -- http://www.universalaccess.com/-- provides
network infrastructure services and facilitates the buying and
selling of capacity on communications networks.  The company, and
its debtor-affiliates, filed for a chapter 11 protection on August
4, 2004 (Bankr. N.D. Ill. Case No. 04-28747).  John Collen, Esq.,
and Rosanne Ciambrone, Esq., at Duane Morris LLC, represent the
Company.  David W. Wirt, Esq., and David Neier, Esq., at Winston &
Strawn, represent an Official Committee of Unsecured Creditors.  
When the Debtor filed for protection from its creditors, it listed
$22,047,000 in total assets and $24,054,000 in total debts.


VARTEC TELECOM: Look for Schedules & Statements by Dec. 16
----------------------------------------------------------
Vartec Telecom, Inc., and its debtor-affiliates ask the U.S.
Bankruptcy Court for the Northern District of Texas, Dallas
Division, for an extension of time to file their schedules and
statements of financial affairs.  According to the Debtors, an
extension until Dec. 16 is sufficient.

The Debtors submit that due to the size and complexity of their
businesses they need more time to gather the vast amount of
information that is required to accurately complete their
schedules and financial statements.

The Debtors ask the Court that they be entitled to use the book
value of their assets instead of the market value.  They explain
that they can only speculate on their assets market value since
they don't maintain a book for market valuation.

Headquartered in Dallas, Texas, Vartec Telecom Inc. --
http://www.vartec.com/-- is a provider of local and long distance  
service and is considered a pioneer in promoting 10-10 calling
plans.  The Company and its affiliates filed for chapter 11
protection on November 1, 2004 (Bankr. N.D. Tex. Case No.
04-81695).  Daniel C. Stewart, Esq., William L. Wallander, Esq.,
and Richard H. London, Esq., at Vinson & Elkins represent the
Debtors in their restructuring efforts.  When the Company filed
for protection from its creditors, it listed more than $100
million in assets and debts.


VARTEC TELECOM: Brings In Hughes & Luce as Special Counsel
----------------------------------------------------------
Vartec Telecom and its debtor-affiliates seek authority from the
U.S. Bankruptcy Court for the Northern District of Texas, Dallas
Division, to retain Hughes & Luce, LLP, as their special counsel.

Hughes & Luce is expected to:

     a) negotiate, arbitrate and litigate in proceedings before      
        administrative agencies as well as state and federal
        courts of issues relating to interconnection agreements
        with competitive local exchange carriers;

     b) negotiate and litigate in state and federal courts of
        disputes related to fees assertedly due to
        municipalities and water districts growing out of use of
        streets, right-of-way ditches and other facilities owned
        or managed by such municipalities and water districts;

     c) litigate in state and federal courts of subscriber class
        actions involving goods and services sold by SBC to
        customers; and

     d) legislate matters pending before various state
        legislative bodies, especially the Texas Legislature.

Craig W. Budner, Esq., a partner at Hughes & Luce, will be the
lead attorney in these proceedings.

According to Mr. Budner, his Firm received approximately $178,354
retainer fee.  He discloses the Firm's professionals current
hourly rates:

               Designation      Billing Rate
               -----------      ------------
               Partners         $295 to $390
               Associates       $175 to $255
               Paralegals           $150

To the best of the Debtors' knowledge, Hughes & Luce is a
"disinterested" party as that term is defined in Section 101(14)
of the Bankruptcy Code.

Headquartered in Dallas, Texas, Vartec Telecom Inc. --
http://www.vartec.com/-- provides local and long distance service  
and is considered a pioneer in promoting 10-10 calling plans.  The
Company and its affiliates filed for chapter 11 protection on
November 1, 2004 (Bankr. N.D. Tex. Case No. 04-81695).  Daniel C.
Stewart, Esq., William L. Wallander, Esq., and Richard H. London,
Esq., at Vinson & Elkins represent the Debtors in their
restructuring efforts.  When the Company filed for protection from
its creditors, it listed more than $100
million in assets and debts.


VERESTAR INC: American Tower Tries to Torpedo Debtors' Plan
-----------------------------------------------------------
American Tower Corporation, by its counsel Barry N. Seidel, Esq.,
of King & Spalding LLP, tells the U.S. Bankruptcy Court for the
Southern District of New York it objects to the proposed
Disclosure Statement explaining the Joint Consolidated Liquidating
Plan of Reorganization filed by Verestar Inc. and its debtor-
affiliates in September.  

American Tower tells the Court that approving the Disclosure
Statement will be useless since Verestar's underlying Plan is not
confirmable.

American Tower explain that it intends to vote to reject the Plan
because it fails to provide sufficient information on the
treatment of it's $535 million claim against Verestar.  Being
Verestar's largest creditor, the Plan will not be confirmed
without American Tower's affirmative vote.

American Tower wants the Court to give it permission to file an
alternative plan of reorganization for the Debtors.

         The Joint Liquidating Plan of Reorganization

Verestar's Plan provides for the consolidation of all of the
Debtors' estates and intermingling of operations.

Under the Plan, the Company will liquidate all of its assets and
will cease to operate as a satellite service provider once
liquidation is completed.

The Plan allows for the full payment of:

          * administrative claims;
          * allowed priority tax claims;
          * secured claims; and
          * SkyTerra secured claims

on the Effective Data or as soon as practicable.

General Unsecured claims will receive their pro rata share of
available cash.  All equity holders will not receive any
distribution under the Plan.

A full-text copy of the Disclosure Statement is available for a
fee at:

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

                American Tower's Claim

The Debtors' Schedules reflect an alleged prepetition unsecured
debt to American Tower in the approximate amount of $522,122,000.  
The initial result of the Official Committee of Unsecured
Creditors' investigation reveals that the Debtors may be able to
contest the said claim based on recharacterization and equitable
subordination.

The Committee further believes that the Debtors may be able to
file:

     * avoidance actions under chapter 5 of the Bankruptcy           
       Code; and

     * various cases involving among others fraud,
       conversion, tortious interference with contract,
       breach of fiduciary duty, insolvency and negligent
       misrepresentation against American Tower.

Headquartered in Fairfax, Virginia, Verestar, Inc., --
http://www.verestar.com/-- is a provider of satellite and  
terrestrial-based network communication services. The Company
and two of its affiliates filed for chapter 11 protection on
December 22, 2003 (Bankr. S.D.N.Y. Case No. 03-18077). Matthew
Allen Feldman, Esq., at Willkie Farr & Gallagher LLP represents
the Debtors. When the Company filed for protection from its
creditors, it listed assets and debts of more than $100 million
each.


VIVENTIA BIOTECH: Dan Group Completes Private Placement
-------------------------------------------------------
Leslie Dan and Andrea Dan-Hytman, the principal shareholders of
Viventia Biotech Inc. (TSX: VBI), a Canadian biopharmaceutical
company specializing in the discovery and development of fully
monoclonal antibodies for the treatment of cancer, reported that
they have, directly and indirectly through entities controlled by
them, completed their previously announced private placement with
the Company.

In accordance with the terms of the Private Placement, the Dan
Group invested $14 million in secured convertible debentures of
the Company and converted $8.9 million plus accrued interest of
currently outstanding unsecured demand bridge financing loans into
Debentures. The Debentures are secured by a first charge over all
of the assets of the Company and bear interest at the rate of 4.5%
per annum, compounded annually. The Debentures will mature two
years from the date of issuance, when both interest and principal
will be payable. The principal amount of the Debentures is
convertible at the option of the holder at any time into units at
a price of $1.50 per Unit. Each Unit is comprised of one common
share of the Company and one half of a common share purchase
warrant. Each whole common share purchase warrant will enable the
holder to purchase an additional common share at an exercise price
of $2.00 per common share at any time for a period of four years
from the date of issuance. The conversion price of any accrued
interest on the Debentures will be equal to the ten-day weighted
average trading price of the Company's common shares for the ten
consecutive trading days prior to conversion less the maximum
discount permitted by the TSX.

As a result of the Private Placement and internal transactions
between members of the Dan Group, Leslie Dan and/or entities
affiliated with him own Debentures in the principal amount of
$12,584,142.47 and Andrea Dan-Hytman and/or entities affiliated
with her own Debentures in the principal amount of $10,562,568.49.

Prior to the completion of Private Placement, Leslie Dan and/or
entities affiliated with him owned 16,416,924 common shares and
5,995,972 warrants to purchase common shares, representing 56.2%
of the issued and outstanding common shares of the Company and
52.4% of the issued and outstanding warrants of the Company and
Andrea Dan-Hytman and/or entities affiliated with her owned
7,758,737 common shares and 4,049,040 warrants to purchase common
shares, representing 26.6% of the issued and outstanding common
shares of the Company and 35.4% of the issued and outstanding
warrants of the Company.

After giving effect to the Private Placement, and assuming the
conversion of the principal amount of the Debentures, Leslie Dan
and/or entities affiliated with him own 24,806,352 common shares
and 10,190,686 warrants to purchase common shares, representing
55.6% of the issued and outstanding common shares of the Company
and 53.2% of the issued and outstanding warrants of the Company
and Andrea Dan-Hytman and/or entities affiliated with her own
14,800,449 common shares and 7,569,896 warrants to purchase common
shares, representing 33.2% of the issued and outstanding common
shares of the Company and 39.5% of the issued and outstanding
warrants of the Company.

The purchase of the Debentures has been made for investment
purposes. Subject to applicable securities laws Leslie Dan and
Andrea Dan-Hytman and/or entities controlled by them may,
depending on market and other conditions, increase or decrease
their ownership, control or direction over securities of the
Company, through market transactions, private agreements or
otherwise.

                        About the Company

Viventia Biotech Inc. is a biopharmaceutical company advancing a
new generation of monoclonal antibody therapeutics designed to
offer safer, more beneficial therapies for cancer patients.
Viventia's fully integrated technology platform is based upon the
isolation of human monoclonal antibodies from cancer patients, and
the development of those antibodies to deliver cancer-killing
payloads directly to cancer cells. Viventia's lead product
candidate Proxinium(TM) is in clinical development for the
treatment of head and neck cancer and bladder cancer, and several
other product candidates are in pre-clinical development.

At June 30, 2004, Viventia's shareholders' deficit widened to
$13,283,000, compared to a $4,484,000 deficit at Dec. 31, 2003.


W.R. GRACE: Employees Sue Over $40-Mil Retirement Fund Sell-Out
---------------------------------------------------------------
Employees of W. R. Grace & Co. (NYSE: GRA), have filed a class
action against Grace to recover $40 million in profits lost by the
class in their personal retirement accounts.  

A full-text copy of the 27-page Complaint, filed in the U.S.
District Court for the Eastern District of Kentucky, is available
at no charge at:

          http://bankrupt.com/misc/04-218-DLB.pdf

The defendants named in the lawsuit are:

     * W.R. Grace & Co.
     * W.R. Grace Investment and Benefits Committee
     * Fred E. Festa
     * Paul J. Norris
     * Robert R. Tarola
     * John F. Akers
     * Henry Furlong Baldwin
     * Ronald C. Cambre
     * Marye Anne Fox
     * John J. Murphy
     * Thomas A. Vanderslice
     * Fidelity Management Trust Company
     * State Street Bank and Trust Company and
     * State Street Global Advisors

The employees claim that Grace and its investment advisors forced
the employees to sell their Grace stock at a distressed price of
$3.50 per share. Soon after the sale, the stock value tripled but
the employees got nothing.  The 300% profit -- nearly $40 million
-- was taken from the Grace employees and pocketed or diverted to
others by State Street Bank & Trust of Boston, the Plan's
investment advisor, according to the federal court complaint filed
by the employees.

The employees and the class members are represented by Waite,
Schneider, Bayless & Chesley of Cincinnati, Ohio, a nationally
known business litigation law firm.  

"This case is corporate arrogance at its worst -- Grace just
walked all over its employees and destroyed their life savings,"
said Stan Chesley, one of the employees' trial attorneys.

According to the lawsuit, Grace purposely set up the retirement
plan so the personal savings of the employees could be used to buy
the company's stock.  In early 2004, Grace hired State Street Bank
& Trust of Boston to rapidly liquidate all of the employees' Grace
stock investment at an artificially low sales price.  Grace
ignored the protests and objections of the employees, the lawsuit
says.  The employees were even instructed by Grace to have no
communication with State Street, their retirement plan's advisor.

The case will be heard by Judge David Bunning of the U.S. District
Court in Covington, Kentucky.  As part of the early stages of the
case, the employees' attorneys are investigating the unusual
relationship among Grace, State Street and others involved in the
transactions, according to Jim Cummins, the employees' other
principal trial attorney.


WASHINGTON MUTUAL: Fitch Lifts Classes B2 & B5's Ratings to BBB
---------------------------------------------------------------
Fitch Ratings has taken rating actions on the following Washington
Mutual residential mortgage-backed certificates:

   * Washington Mutual mortgage pass-through certificates, series
     2000-1

     -- Class A2 affirmed at 'AAA';
     -- Class M1 affirmed at 'AAA';
     -- Class M2 upgraded to 'AAA' from 'AA+';
     -- Class M3 upgraded to 'AA' from 'A+';
     -- Class B1 upgraded to 'A' from 'BB+';
     -- Class B2 upgraded to 'BBB' from 'B+'.

   * Washington Mutual mortgage pass-through certificates, series
     2001-7

     -- Class A affirmed at 'AAA';
     -- Class M1 affirmed at 'AAA';
     -- Class M2 upgraded to 'AA+' from 'AA';
     -- Class M3 upgraded to 'A+' from 'A'.

   * Washington Mutual mortgage pass-through certificates, series
     2002-AR11

     -- Classes A1, M1 affirmed at 'AAA';
     -- Class B1 upgraded to 'AAA' from 'AA';
     -- Class B2 upgraded to 'AAA' from 'A';
     -- Class B3 upgraded to 'AA' from 'BBB';
     -- Class B4 upgraded to 'A' from 'BB';
     -- Class B5 upgraded to 'BBB' from 'B'.

The upgrades, affecting approximately $69 million, are being taken
as a result of low delinquencies and losses, as well as increased
credit support levels.  The affirmations, affecting approximately
$1.36 billion, are due to credit enhancement consistent with
future loss expectations.  The credit enhancement for the reviewed
classes as of Oct. 25th, 2004 distribution increased as much as
four times (x) the original credit enhancement percentage.

The collateral of WAMU 2000-1 primarily consists of negative
amortization COFI adjustable-rate, 30-40 year fully amortizing
mortgage loans, secured by first liens on one- to four-family
residential properties.  WAMU 2001-7 has collateral consisting of
jumbo, negative amortizing MTA-indexed adjustable-rate, 30-40 year
fully amortizing mortgage loans, secured by first liens on one- to
four-family residential properties.  Finally, WAMU 2002-AR11 has
collateral consisting of conventional, fully amortizing 30-year
adjustable-rate mortgage loans, secured by first liens on one- to
four-family residential properties.

The three deals have pool factors (i.e., percentage of remaining
pool balance out of the original balance as of the cut-off date)
ranging from 14% to 18% as of October 25, 2004 distribution.


WILSON N. JONES: Weak Balance Sheet Cues Fitch to Cut Rating to B+
------------------------------------------------------------------
Fitch Ratings downgraded to 'B+' from 'BB+' the rating on the
outstanding $45,900,000 Metro Health Facilities Development Corp.
(Sherman, TX) hospital revenue bonds, series 2001.  Fitch does not
rate the series 1993 ($39,960,000 outstanding), which are insured
by Ambac Assurance Corp. (rated 'AAA' by Fitch).  The Rating
Outlook has been revised to Stable from Negative.

The rating downgrade to 'B+' reflects Wilson N. Jones Regional
Health System's weakening balance sheet, a high debt burden, high
bad debt exposure, and weak utilization trends.  WNJ's
unrestricted cash and investments totaled $13 million (43 days
cash on hand), net of $3.1 million short-term debt at
September 30, 2004.  This equates to a 17.8% cash-to-debt ratio,
compared with Fitch's 2004 median cash-to-debt ratio of 30.5% for
non-investment grade credits.  WNJ continues to have a covenant
violation regarding the required maintenance of 70 days cash on
hand and management expects cash on hand to decline to 35.0 days
at December 31, 2004 due to additional capital spending from cash
reserves.  Fitch considers WNJ's debt burden to be high, as
evidenced by maximum annual debt service (MADS) being 6.1% of
revenue at September 30, 2004, compared with Fitch's 2004 median
ratio for non-investment grade credits of 4.6%.  This includes
roughly $4.5 million of an already-accrued liability, based on a
court-ordered settlement with the Pension Guaranty Benefit Corp.
-- PGBC.  Through September 30, 2004, WNJ's bad debt expense as a
percentage of revenues was 16.5%, compared with Fitch's 2004
median ratio of 7% for non-investment grade credits, and
reflective of an economically weak service area.  Finally, WNJ's
utilization trends since 2003 have been negative.  Management
states that declines in inpatient utilization are attributable to
the closure of several large employers in the service area,
increased outmigration to Dallas, and to the 2003 closure of WNJ's
unprofitable trauma unit.  A new competing heart hospital is
expected to open in Plano, TX, in December 2004, and the effects
of this are unclear.  Cardiology is one of WNJ's clinical
strengths.

Credit strengths include the new management at WNJ, positive
financial operations since 2003, and WNJ's continued leading
market share in the primary service area.  In fiscal 2003, WNJ's
chief executive officer and chief financial officer were fired,
and interim management was brought in by Cambio Health Solutions,
which was approved by bondholders.  In 2004, a new full-time CEO
and CFO were hired by the board of directors, and management is
continuing to implement Cambio's recommendations.  WNJ is
returning to profitability, with a 1.6% margin in 2003 and 1.9%
margin through September 30, 2004, which Fitch views positively.
Days in accounts receivable has improved to 50.9 through nine
months of 2004 from 57.6 in 2002 after the write-down in bad debt.
However, there are still major operational challenges at WNJ,
principally at the North Campus that continues to be a financial
drain before it is leased to SeniorHealth, expected to be
effective in either the first or second quarter of 2005.

The Stable Outlook reflects Fitch's belief that while restoration
of the balance sheet will take considerable time, positive
financial margins are a positive trend, though management still
faces numerous obstacles to fully turn around operations.  Fitch's
definition of 'B' category ratings indicates that significant
credit risk is present, but a limited margin of safety remains.  
Financial commitments are currently being met; however, capacity
for continued payment is contingent upon a sustained, favorable
business and economic environment.

Located in Sherman, Texas (65 miles north of Dallas in Grayson
County), WNJ is a small hospital system that operates 285 beds at
two campuses.  WNJ had $139 million in total operating revenue in
fiscal 2003.  WNJ covenants to provide quarterly disclosure to
bondholders, including a balance sheet, income statement, and
statement of cash flows, which Fitch views favorably.


WORLDCOM INC: R.A.K. Wants Court to Compel Cure Claim Payment
-------------------------------------------------------------
The WorldCom, Inc. and its debtor-affiliates lease space at
1201 Main Street in Dallas, Texas, owned by R.A.K. Mainplace
Associates, L.P., and license space at the Main Street Premises
for conduit, switches and hardware, which are utilized in their
businesses.

Pursuant to the Confirmed Plan, the Debtors assumed all leases of
real property and executory contracts, which were not listed on
Schedule 8.01(b) of the Plan.  Michael V. Blumenthal, Esq., at
Brown Raysman Millstein Felder & Steiner, LLP, in New York, tells
Judge Gonzalez that R.A.K.'s Leases and Licenses were not listed
on Schedule 8.01(b) of the Plan and were therefore assumed by the
Debtors.

On September 23, 2003, R.A.K. filed two amended proofs of claim
against the Debtors' estate:

    (1) Claim No. 36289, which replaced Claim No. 22028, asserts
        a $481,402 unsecured claim and a $116,919 administrative
        claim; and

    (2) Claim No. 36317, which replaced Claim No. 22029, asserts a
        $571,645 unsecured claim and a $122,140 administrative
        claim.

The Debtors objected to R.A.K.'s claims.

Mr. Blumenthal notes that under the Plan, the Debtors were
required to cure the defaults under the Leases and Licenses by
May 20, 2004, unless R.A.K.'s Cure Claims were disputed claims as
of that date.  R.A.K.'s. Cure Claims were not disputed at the time
the Debtors were required to pay cure claims under the Plan.
Therefore, the Debtors are in default of their obligations under
the Plan to pay the Cure Claims.

The Cure Claims were filed as amended claims after R.A.K.
discovered that the Debtors incorrectly installed electric meters
at the Premises, Mr. Blumenthal relates.  The meters failed to
accurately reflect the Debtors' electric usage at the Premises.

R.A.K.'s Claim No. 36317 asserts, inter alia, a claim for unbilled
metered electricity for $502,767, consisting of $407,540 in
prepetition electric charges and $95,227 in postpetition electric
charges.  The Debtors acknowledged that the incorrect installation
of an electric meter resulted in miscalculations of the amounts
due and owing from the Debtors for electric usage. Specifically,
on August 16, 2004, Bob Fries, one of the Debtors' business
persons, sent an e-mail to R.A.K. acknowledging that the
Debtors owe R.A.K. $416,523 with respect to the electric charges,
relating to Claim No. 36317.

R.A.K. believes that the outstanding unbilled electric charges
with respect to Claim No. 36317 exceed the $416,523 acknowledged
by the Debtors.  Since $416,523 in electric charges is not
disputed, then under the Plan, the charges are allowed and should
be immediately paid by the Debtors.  Mr. Blumenthal points out
that the balance of Claim No. 36317 remains disputed and should be
resolved after an evidentiary hearing before the Court.

Mr. Blumenthal asserts that the Debtors' objection to the Cure
Claims that R.A.K. failed to provide sufficient documentation to
support its claims is devoid of merits and should be overruled.
On January 12, 2004, counsel for R.A.K. received an e-mail from
the Debtors' counsel requesting back-up documentation for
R.A.K.'s Cure Claims.  The following day, R.A.K.'s counsel sent a
package containing the back-up documentation for the Cure Claims
to the Debtors' counsel.  The Debtors' counsel made no further
requests for information concerning the Cure Claims.

Accordingly, R.A.K. asks Judge Gonzalez to compel the Debtors to
immediately pay the Cure Claims.

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


WORLDCOM INC: Agrees to Withdraw Labor Department's ERISA Claims
----------------------------------------------------------------
Elaine L. Chao, Secretary of the United States Department of
Labor, filed Claim Nos. 17120, 17121, 17123 to 17188, 17190,
17191, and 17196 to 17248 against Worldcom Inc. and its debtor-
affiliates.  The Claims include contingent claims against the
Debtors arising from possible breaches of fiduciary duties under
the Employee Retirement Income Security Act of 1974, as amended.

To resolve certain ERISA claims, the Debtors and certain persons
other than Ms. Chao entered into a Class Action Settlement
Agreement dated July 2, 2004.  On July 21, 2004, the United
States District Court for the Southern District of New York
granted preliminary approval of the ERISA Settlement Agreement.
On August 24, 2004, the Bankruptcy Court approved the ERISA
Settlement Agreement, subject to certain contingencies including
the entry of the Final Order by the District Court, and the
occurrence of the Effective Date of the ERISA Settlement
Agreement.

The Principal Class Settlement Amount has been deposited into the
Settlement Fund as required under the ERISA Settlement Agreement.
The District Court has scheduled a fairness hearing to decide
whether to approve the ERISA Settlement Agreement and to enter the
Final Order.

The ERISA Settlement Agreement allows the Debtors to terminate the
ERISA Settlement Agreement at any time up to seven days before the
Fairness Hearing, if any issue between the Secretary and the
Debtors has not been resolved on terms acceptable to the Debtors.

The Debtors desire to remove any uncertainty as to how the Proofs
of Claim affect the ERISA Settlement Agreement or the Fairness
Hearing, and the Secretary is willing to facilitate the Fairness
Hearing by agreeing to the withdrawal of the Proofs of Claim.

Thus, the Debtors and the Labor Secretary agree that:

    (a) The Labor Secretary's Claims will be deemed withdrawn in
        their entirety and with prejudice.  On the Effective Date
        of the ERISA Settlement Agreement, the Labor Secretary
        will have no claims against the Debtors based thereon,
        without the necessity of further action on the part of the
        Debtors, the Labor Secretary, the District Court or the
        Bankruptcy Court;

    (b) The withdrawal of the Claims will not apply to any claims
        of the Labor Secretary arising from:

           * $637,000 in participant account balance forfeitures
             reported for the CompuServe 401(k) Plan during the
             period October 1998-2002; or

           * health benefits owed to participants in the WorldCom
             Severance Plan, whose employment were terminated as
             the result of the Company's June 28, 2002 reduction
             in force; and

    (c) In the event the Effective Date of the ERISA Settlement
        Agreement does not occur and the ERISA Settlement
        Agreement terminates:

           (a) the Proofs of Claim will revert to their original
               status; and

           (b) the time by which the Debtors may file objections
               to the Proofs of Claim will be extended through and
               including the date that is 75 days from the day the
               termination of the ERISA Settlement Agreement is
               effective.

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



* U.S. Corporate Credit Quality Slips in October, Says Kamakura
---------------------------------------------------------------
Kamakura Corporation reported that its monthly index of troubled
companies in the United States increased for the third consecutive
month, rising 0.2% in September to 14.6% of the public company
universe. Kamakura classifies any company with a default
probability of more than one percent as troubled. Among highly
rated companies, AAA-rated Merck & Co. saw its default
probabilities jump 50-150 basis points over the course of the
month. Generally speaking, the increase in Kamakura's troubled
company index was due to an increase in companies with
probabilities of failure between 10% and 100%. The Kamakura
troubled company index hit a low of 11.1% in April, 2004.

"The October credit quality of public companies in North America
was variable from week to week, but the downward trend in credit
quality is clear," commented Dr. Donald R. van Deventer, Kamakura
Chairman and Chief Executive Officer. "The number of companies
with default probabilities between 1% and 5% stayed at 8.3% of the
universe compared to September. Companies with default
probabilities between 5 and 10% were also unchanged at 2.4% for
October. Companies with default probabilities between 10% and 20%
increased 0.1% to 1.5% of the universe. The riskiest firms in the
universe, those with default probabilities over 20%, now total
2.4% of the universe, an increase of 0.1%."

Kamakura is offering free trials of its KRIS default probability
service to qualified institutions. For more information on
Kamakura's free trial offer please contact Kamakura at
info@kamakuraco.com. More information can also be found on the
Kamakura Corporation web site http://www.kamakuraco.com/and in  
"Advanced Financial Risk Management" (John Wiley & Sons, 2004) by
Kamakura's van Deventer, Kenji Imai, and Mark Mesler -- available
on http://www.amazon.com/  

                        About the Company

Kamakura Corporation is a leading provider of risk management
information, processing and software. Kamakura has been a provider
of daily default probabilities for listed companies since
November, 2002. Kamakura launched its private firm modeling
product in January 2004. Kamakura is also the first company in the
world to develop and install a fully integrated credit risk,
market risk, asset and liability management, and transfer pricing
system. Kamakura has clients ranging in size from $3 billion in
assets to $1 trillion in assets. Kamakura's risk management
software is currently used in the United States, Germany, Canada,
the United Kingdom, Australia, China and many other countries in
Asia.

Kamakura's research effort is led by Professor Robert Jarrow, who
was named Financial Engineer of the Year in 1997 by the
International Association of Financial Engineers. Professor Jarrow
and Dr. van Deventer were both named to the 50 member RISK Hall of
Fame in December 2002.

Kamakura management has published twenty-one books and more than
100 publications on credit risk, market risk, and asset and
liability management. Kamakura has world-wide distribution
alliances with IPS-Sendero -- http://www.ips-sendero.com/and  
Unisys -- http://www.unisys.com/-- making Kamakura products  
available in almost every major city around the globe.


* BOND PRICING: For the week of November 8 - November 12, 2004
--------------------------------------------------------------

Issuer                                Coupon   Maturity  Price
------                                ------   --------  -----
Adelphia Comm.                         6.000%  02/15/06    21
Allied Holdings                        8.625%  10/01/07    75
American Airline                       4.250%  09/23/23    73
AMR Corp.                              4.500%  02/15/24    65
AMR Corp.                              9.000%  08/01/12    63
AMR Corp.                              9.000%  09/15/16    60
AMR Corp.                             10.200%  03/15/20    56
Applied Extrusion                     10.750%  07/01/11    58
Armstrong World                        6.350%  08/15/03    71
Bank New England                       8.750%  04/01/99    10
Burlington Northern                    3.200%  01/01/45    57
Calpine Corp.                          7.750%  04/15/09    57
Calpine Corp.                          7.785%  04/01/08    63
Calpine Corp.                          8.500%  07/15/10    72
Calpine Corp.                          8.500%  02/15/11    58
Calpine Corp.                          8.625%  08/15/10    58
Calpine Corp.                          8.750%  07/15/07    71
Comcast Corp.                          2.000%  10/15/29    44
Continental Airlines                   4.500%  02/01/07    71
Delta Air Lines                        7.711%  09/18/11    68
Delta Air Lines                        7.900%  12/15/09    47
Delta Air Lines                        8.000%  06/03/23    47
Delta Air Lines                        8.300%  12/15/29    37
Delta Air Lines                        9.000%  05/15/16    37
Delta Air Lines                        9.250%  03/15/22    37
Delta Air Lines                        9.750%  05/15/21    37
Delta Air Lines                       10.000%  08/15/08    55
Delta Air Lines                       10.125%  05/15/10    46
Delta Air Lines                       10.375%  02/01/11    46
Dobson Comm. Corp.                     8.875%  10/01/13    68
Evergreen Int'l Avi.                  12.000%  05/15/10    65
Falcon Products                       11.375%  06/15/09    62
Federal-Mogul Co.                      7.500%  01/15/09    31
Finova Group                           7.500%  11/15/09    44
Foamex L.P.                            9.875%  06/15/07    72
Greyhound Lines                        8.500%  03/31/07    75
Iridium LLC/CAP                       14.000%  07/15/05    10
Inland Fiber                           9.625%  11/15/07    46
Kaiser Aluminum & Chem.               12.750%  02/01/03    18
Kulicke & Soffa                        0.500%  11/30/08    75
Level 3 Comm. Inc.                     2.875%  07/15/10    71
Level 3 Comm. Inc.                     6.000%  09/15/09    60
Level 3 Comm. Inc.                     6.000%  03/15/10    59
Liberty Media                          3.750%  02/15/30    68
Liberty Media                          4.000%  11/15/29    73
Mirant Corp.                           2.500%  06/15/21    67
Mirant Corp.                           5.750%  07/15/07    67
Mississippi Chem.                      7.250%  11/15/07    56
National Vision                       12.000%  03/30/09    62
Northern Pacific Railway               3.000%  01/01/47    57
Northwest Airlines                     7.875%  03/15/08    72
Northwest Airlines                    10.000%  02/01/09    73
Nutritional Src.                      10.125%  08/01/09    65
Oglebay Norton                        10.000%  02/01/09    44
O'Sullivan Ind.                       13.375%  10/15/09    39
Owens Corning                          7.000%  03/15/09    52
Owens Corning                          7.500%  05/01/05    56
Owens Corning                          7.500%  08/01/18    53
Pegasus Satellite                     12.375%  08/01/06    64
Pegasus Satellite                     13.500%  03/01/07     2
Pen Holdings Inc.                      9.875%  06/15/08    51
PG&E National Energy                  10.375%  05/16/11    75
RCN Corp.                             10.000%  10/15/07    53
RCN Corp.                             10.125%  01/15/10    55
RCN Corp.                             11.125%  10/15/07    53
Reliance Group Holdings                9.000%  11/15/00    18
Spacehab Inc.                          8.000%  10/15/07    65
Syratech Corp.                        11.000%  04/15/07    45
Trico Marine Service                   8.875%  05/15/12    50
Tower Automotive                       5.750%  05/15/24    60
United Air Lines                       9.125%  01/15/12     6
United Air Lines                      10.670%  05/01/04     5
Univ. Health Services                  0.426%  06/23/20    58
Westpoint Stevens                      7.875%  06/15/08     0
Zurich Reinsurance                     7.125%  10/15/23    64

                          *********

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 ***