TCR_Public/041111.mbx       T R O U B L E D   C O M P A N Y   R E P O R T E R

        Thursday, November 11, 2004, Vol. 8, No. 247

                          Headlines

AAC GROUP: Moody's Junks Planned $85M Sr. Unsecured Discount Notes
AAIPHARMA INC: Reports $33.8 Million of Net Loss in 3rd Quarter
ADELPHIA COMMS: Who Gets What Under the Creditors' Plan Proposal
AEROCENTURY CORP: Lenders Agree to Renew Revolving Credit Facility
AFFINIA GROUP: Moody's Places Single-B & Junk Ratings on Debts

ALEPH MANAGEMENT: Hires Adelman Lavine as Bankruptcy Counsel
ALEPH MANAGEMENT: Gets Interim Okay to Use Cash Collateral
AMERICAN ACHIEVEMENT: S&P Revises Outlook on Ratings to Negative
ASSET BACKED: Fitch Slices Class B-1F's Rating to 'BB+' from 'BBB'
ASTROPOWER INC: Confirmation Objections Must Be Filed by Tuesday

ATA AIRLINES: Asks Court to Approve Indiana's $15.5M Financing
ATA AIRLINES: Wants to Employ Baker & Daniels as Lead Counsel
ATA AIRLINES: Wants to Hire Ponader & Associates as Co-Counsel
AXCESS INT'L: Sept. 30 Balance Sheet Upside-Down by $3.9 Million
BM USA: Texas Bankruptcy Court Confirms Plan of Reorganization

BOISE CASCADE: Completes Tender Offer & Consent Solicitation
CANWEST MEDIA: Moody's Upgrades Senior Secured Rating to Ba2
CATHOLIC CHURCH: Mr. DuFresne Told to File Adv. Pro. to Get Info.
CHATTEM INC: S&P Upgrades Corporate Credit Rating to BB- from B+
CONSTELLATION BRANDS: Moody's Reviewing Ratings & May Downgrade

CORNERSTONE PROPANE: Court Confirms Plan of Reorganization
D & D WELDING: Case Summary & 20 Largest Unsecured Creditors
DEX MEDIA: Moody's Rates Proposed $200M Senior Unsecured Notes B1
DEX MEDIA: S&P Puts 'B' Rating on Planned $200 Mil. Senior Notes
DI GIORGIO: S&P Places B+ Rating on CreditWatch Negative

DPL INCORPORATED: Moody's Reviewing Low-B Ratings & May Upgrade
DYNEGY INC: Completes Sale of Sherman Natural Gas Processing Plant
E-TERRA LLC: Case Summary & 20 Largest Unsecured Creditors
FRESH CHOICE: Committee Taps Corporate Revitalization as Advisor
GADZOOKS INC: Files Plan of Reorganization in Texas

GALEY & LORD: Completes $154 Mil. Asset Sale to Patriarch Partners
GENCORP INC: Moody's Junks Planned $50 Mil. Convertible Sub. Notes
GENCORP INC: Fitch Assigns Low-B Ratings to Proposed Loan & Bonds
GENCORP INC: S&P Rates Planned $175M Senior Secured Facilities BB
GLOBALSTAR CAPITAL: Court Formally Closes Chapter 11 Proceedings

HERBALIFE: Moody's Rates Proposed $225M Sr. Sec. Facility at Ba3
HERBALIFE: S&P Assigns BB- Rating to Proposed $225 Mil. Facility
HILL CITY: Hires Oirill Cordel as Bankruptcy Counsel
HOLLYWOOD CONVENIENCE: Voluntary Chapter 11 Case Summary
HOME INTERIORS: S&P Slices Corporate Credit Rating to B- from B

IITC HOLDINGS: Winds Up Operations Following Share Distribution
INTERCEPT INC: Fidelity National Closes Stock Acquisition
INTERTAPE POLYMER: Closing Montreal Manufacturing Facility
JAFRA COSMETICS: S&P Affirms Single-B Ratings After Review
KAISER ALUMINUM: Court Approves Seventh Amendment to Credit Pact

KMART CORP: Balks at Angola Wire's $1,300,000 Claim
LANCASTER REDEVELOPMENT: S&P Pares Bond Rating to BB+ from BBB-
MARINER HEALTH: Faces $10.5M Indemnification Claim from Formation
MAXIM CRANE: Key Stakeholders Support Plan of Reorganization
MCDERMOTT INT'L: Sept. 30 Balance Sheet Upside-Down by $338.4 Mil.

MERISANT WORLDWIDE: Kills Tender Offer & Scraps IPO
MERISANT WORLDWIDE: CEO Resigns & Is Replaced by Paul Block
MICROCELL TELECOM: Forms New Board Following Rogers Acquisition
MORGAN STANLEY: Fitch Places B+ Rating on $21.2M Class G Certs.
MURRAY INC: Wants to Hire AlixPartners as Claims Agent

NEIGHBORCARE INC: Inks Pact to Acquire Belville Pharmacy Services
NORTEL NETWORKS: Inks Settlement Agreement with Arbinet-thExchange
NORTH AMERICAN: Case Summary & 20 Largest Unsecured Creditors
NUCENTRIX BROADBAND: Makes Initial Distribution to Stockholders
ORTEC INT'L: Grant Thornton Declines Reappointment as Auditor

PEGASUS: Senior Lenders Want to Collect Interest & Prepayments
POLYONE CORP: S&P Revises Outlook on B+ Rating to Stable
SECOND CHANCE: Look for Bankruptcy Schedules on Nov. 15
SECOND CHANCE: Wants to Hire Warner Norcross as Bankruptcy Counsel
SOLUTIA INC: Has Until February 15 to Make Lease-Related Decisions

SOLUTIA INC: S&P Withdraws Default Ratings Due to Lack of Info
SOTHEBY'S HOLDINGS: Posts $28.7 Million Third Quarter Net Loss
SOTHEBY'S HOLDINGS: S&P Upgrades Corporate Credit Rating to BB-
SOUTH SALEM CARE CENTER: Voluntary Chapter 11 Case Summary
STANDARD COMMERCIAL: S&P Puts BB+ Ratings on CreditWatch Negative

STAR CAR WASH: Case Summary & 14 Largest Unsecured Creditors
STAR GAS: Moody's Confirms Junk Ratings with Developing Outlook
TANGO INC: Board Approves Plan to Buy $3 Mil. Warehouse in Oregon
TENNECO AUTOMOTIVE: S&P Places 'B-' Rating on $350M Sr. Sub. Notes
TRAILER BRIDGE: Plans to Offer $80 Million of Senior Secured Notes

TRAILER BRIDGE: Moody's Rates Proposed $80M Sr. Secured Notes B3
TRAILER BRIDGE: Third Qtr. Net Income Up $2 Mil. From Last Year
URECOATS INDUSTRIES: Discontinues RSM Tech. Unit's Operations
UAL CORP: Stay Lifted for HSBC to Access $4.9MM Construction Fund
UAL CORP: Gets Court Nod to Amend Service Agreement with ARINC

US AIRWAYS: Judge Mitchell Appoints 5-Member Retiree Committee
US AIRWAYS: Asks Court to Approve De Minimis Asset Sale Procedures
USG CORP: Wants Ruling that Only U.S. Gypsum Has Tort Liability
USOL INC: Voluntary Chapter 11 Case Summary
W.R. GRACE: Has Until November 15 to File Plan of Reorganization

W.W. HOLDINGS: Lenders Ready to Auction Collateral on Nov. 12
WEIRTON STEEL: Trustee Wants Court Nod on HSBC USA Settlement
WINSTAR COMMS: Judge Farnan Affirms No Stay Relief for BAE Systems
WORLDCOM INC: Court Approves Sprint Settlement Agreement
XOMA LTD: Sept. 30 Balance Sheet Upside-Down by $7.2 Million

* Sullivan & Worcester Expands Technology Practice with 4 Lawyers

                          *********

AAC GROUP: Moody's Junks Planned $85M Sr. Unsecured Discount Notes
------------------------------------------------------------------
Moody's Investors Service assigned a Caa1 rating to the proposed
$85 million senior unsecured discount notes to be issued by AAC
Group Holding Corp. and affirmed its subsidiary, American
Achievement Corporation, existing ratings.  In addition, Moody's
lowered the senior implied rating from B1 to B2 and the senior
unsecured issuer rating from B2 to Caa1 while moving both ratings
from AAC to the new borrower AAC Holdco.  The outlook remains
stable.

The change in the senior implied rating reflects the higher level
of financial and operating risks and resulting weaker credit
protection measures going forward due to the increase in
enterprise debt that is to fund a distribution to existing
shareholders less than nine months after their purchase of this
company.  At the close of the transaction, Debt/EBITDA is expected
to exceed 6.7x using FY 2004 adjusted EBITDA and won't return to
the FYE 2004 5.3x registered level until FYE 2006.  EBIT/Cash
Interest is expected to be less than 2.0x during FY 2005 and will
only marginally exceed 2.0x during FY 2006.  Free cash flow
available for debt repayment will remain modest for the balance of
FY 2005, but is expected to increase as the company's cost cutting
initiatives continue to take hold in subsequent years.  The
ratings also incorporate the company's narrow business focus in a
mature industry, reliance on independent sales forces, and the
high degree of seasonality and delivery risk associated with its
two primary businesses of yearbooks and class rings.  The
company's operations, which are sensitive to commodity price
fluctuations in paper, gold, precious stones and gems, remain
exposed to technology changes and potential adverse trends in
graduation rates or cultural/fashion preferences.

Despite these risks, Moody's continues to recognize the stability
of the school affinity products industry, which is characterized
by:

   (1) its high retention rates;

   (2) the steady growth in the number of graduates; and

   (3) the strong and predictable cash flow generation.

AAC's large network of exclusive independent sales representatives
coupled with the company's ability to meet the service
requirements of its customers under narrow production and delivery
timeframes serves as a substantial barrier to entry that further
supports the ratings.

Because of the PIK nature of the senior discount notes and the
existence of a restricted payments basket in the existing Credit
Agreement, the ratings for AAC have been reaffirmed.  It is
anticipated that by the time the PIK feature expires for the
senior discount notes in April 2008, AAC will have prepaid a
significant amount of term loan debt that should substantially
exceed the amount of accretion in the senior discount notes.  The
senior discount notes at AAC HoldCo will not benefit from any
upstream guarantees and will be structurally subordinated to all
debt at AAC and its subsidiaries.

The stable outlook reflects AAC's historical ability to generate
consistent cash flow, which has facilitated the upgrade of
existing plant and equipment to today's digital standards, along
with the middle stages of installing a new IT system that should
also help to further reduce operating costs and increase
productivity.  With most of these expenditures behind it, the
company should be in a better position to make greater strides in
deleveraging the balance sheet beginning in FY 2006.  Negative
ratings actions could be taken if projected operating performance
trends falter and leverage begins to increase beyond 7.0x.  
Moody's believes that a ratings upgrade would be unlikely until a
sizable reduction in debt is achieved resulting in leverage less
than 4.5x.

The B1 rating on AAC's bank facilities recognizes that these
facilities will be guaranteed by all domestic subsidiaries and
will benefit from a first lien on all property and assets;
however, the collateral coverage provided by the security package
is limited due to the sizable amount of intangible assets which
constitute over 70% of pro forma total assets at close.  The B3
rating on the senior subordinated notes reflects their contractual
subordination in the capital structure behind a material amount of
senior secured debt, all senior unsecured obligations as well as
any debt of non-guarantors. The B2 rating on AAC's senior
unsecured notes reflects the sizable amount of debt at the senior
secured level. It is expected that these notes will be called in
the beginning of 2005 at which time the rating will be withdrawn.

Ratings actions for AAC HoldCo are:

   * $85 million senior unsecured discount notes, due 2012 -- Caa1
     assigned,
   * Senior Implied rating at B2 from B1,
   * Unsecured Issuer rating at Caa1 from B2.

Ratings affirmed for American Achievement Corporation are:

   * $40 million senior secured Revolving Credit due 2006 at B1
   * $155 million senior secured Term Loan due 2011 at B1
   * $6 million senior unsecured notes due 2007 at B2
   * $150 million senior subordinated notes due 2012 at B3.

Headquartered in Austin, Texas, American Achievement Corporation
is a leading provider of school-related affinity products and
services.  The company holds strong market shares in each of its
product segments - yearbooks, class rings, graduation products and
scholastic publications.  Sales for fiscal year 2004 ending
Aug. 28, 2004 were approximately $314 million.


AAIPHARMA INC: Reports $33.8 Million of Net Loss in 3rd Quarter
---------------------------------------------------------------
aaiPharma Inc. (Nasdaq: AAII), a science-based pharmaceutical
company, reported financial results for the quarter ended
September 30, 2004. Net revenues for the third quarter of 2004
were $43.2 million, compared to $39.7 million in the third quarter
of 2003. The Company recorded a net loss of $33.8 million,
compared with a net loss of $9.4 million, in the third quarter of
2003.

Net revenues from the Company's pharmaceutical product business
increased to $15.7 million, compared to $13.7 million in the third
quarter of 2003. Product development revenues increased to $4.5
million from $3.5 million in the same period of 2003. Net revenues
from the Company's development services business increased to
$23.1 million from $22.5 million in the same period of 2003.

Selling expenses decreased by $3.0 million over the same period in
2003 primarily due to reduced product promotion costs and lower
personnel expenses due to the pharmaceutical sales force
restructuring. Research and development expenses were $3.1 million
in the quarter, primarily related to spending on the Lynxorb(TM)
pain management product (previously referred to as ProSorb-D(TM)
and the Company's proton pump inhibitor development program. The
increase in operating costs and expenses included approximately
$13.7 million in restructuring charges and a $5.3 million charge
related to the impairment of intangible assets associated with the
Company's Brethine(R) product due to the introduction of generic
competition.

                   Strategic Initiatives Update

During the quarter, the Company conducted a work force reduction
intended to rationalize its expense base in relation to its
revenue. aaiPharma recorded a $13.7 million restructuring charge
representing severance costs and related employee benefit expenses
for those affected by the reduction, separation payments to the
Company's former Chief Executive Officer, and lease costs for
facilities and aircraft no longer in use.

Subsequent to the end of the third quarter, the Company entered
into an amendment to its senior secured credit facility to, among
other things, increase the amount of the term loans by up to $30
million. In addition, the Company made the October 1, 2004
interest payment on its 11.5% Senior Subordinated Notes due 2010.
aaiPharma also has retained Rothschild Inc. to assist the
management team in its ongoing evaluation of potential asset
divestitures, including the potential sale of some or all of the
assets of the Company's Pharmaceuticals Division.

"We continue to make substantial progress executing our strategic
plans," said Mr. Timothy R. Wright, interim President and CEO of
aaiPharma. "We remain committed to strengthening the Company's
capital structure and returning to a normal business environment."

                        About the Company

aaiPharma Inc. is a science-based pharmaceutical company focused
on pain management, with corporate headquarters in Wilmington,
North Carolina. With more than 25 years of drug development
expertise, the Company is focused on developing and marketing
branded medicines in its targeted therapeutic areas. aaiPharma's
development efforts are focused on developing improved medicines
from established molecules through its research and development
capabilities. For more information on the Company, including its
product development organization AAI Development Services, please
visit aaiPharma's website at http://www.aaipharma.com/

                          *     *     *

As reported in the Troubled Company Reporter on October 4, 2004,
aaiPharma Inc. did not make the Oct. 1, 2004, interest payment on
its 11.5% Senior Subordinated Notes due 2010, and will use the 30-
day grace period provided under the Notes for failure to pay
interest to enter into discussions with an ad hoc committee formed
by certain holders of the Notes. An aggregate interest payment of
$10.0 million was due on the Notes on Oct. 1, 2004. Failure to
make the interest payment by October 31, 2004, would constitute an
event of default under the Notes, permitting the trustee under the
Notes or the holders of 25% of the Notes to declare the principal
and interest thereunder immediately due and payable.

The Company believes there is a likelihood that it will be in
default of certain financial covenants under its senior credit
facility, and is in ongoing active discussions with its lender to
seek waivers and/or consents for these potential defaults.

Standard & Poor's Ratings Services previously affirmed its 'CCC'
corporate credit and 'CC' subordinated debt ratings on aaiPharma,
Inc. At the same time, Standard & Poor's removed the ratings on
the Wilmington, North Carolina-based specialty pharmaceutical
company from CreditWatch.

S&P's outlook on aaiPharma is negative.


ADELPHIA COMMS: Who Gets What Under the Creditors' Plan Proposal
----------------------------------------------------------------
As reported in the Troubled Company Reporter yesterday, the
Official Committee of Unsecured Creditors of Adelphia
Communications Corp. and its subsidiaries reached a preliminary
agreement among its members and other substantial creditors on the
principal terms of a reorganization plan by which Adelphia could
emerge from bankruptcy as a stand-alone independent entity.  A
term sheet unanimously approved by the six-member committee has
the support of other holders of Adelphia's unsecured debt, but not
Adelphia's explicit support.  

The Creditors' Plan Proposal tracks the structure of the Debtors'
Plan, dated February 25, 2004.  The Plan is premised on the
substantive consolidation of the Debtors within each of the ten
Debtor Groups and includes a settlement between the Parent Debtor
Group and the Arahova Debtor Group.  

The Creditors' Plan Proposal is based on a hypothetical $17
billion reorganization value on a going concern basis.

The Creditors assume these cash payments will be made:

   Claims Class                            Estimated Amount
   ------------                            ----------------
   DIP Lender Claims                           $772,539,408
   Bank Claims                               $6,816,627,500
   Administrative and Priority Claims          $500,000,000
   Other Secured Claims                        $251,623,406

and the remaining value, in the form of New Common Stock, will be
distributed to the holders of:

   Claims Classification                   Estimated Amount
   ------------                            ----------------
   Subsidiary Note Claims                    $3,477,396,774
   Subsidiary Unsecured Claims               $1,156,356,193
   Subsidiary 510(b) Claims                   $undetermined

The remaining value will then be paid, again in the form of New
Common Stock to the holders of:

   Claims Classification                   Estimated Amount
   ------------                            ----------------
   ACC Senior Note Claims                    $6,781,829,658
   ACC Unsecured Claims                        $462,677,710
      
In the event the Debtors receive a cash offer (or multiple offers)
exceeding $17.5 billion for their assets, the Plan Proposal
delivers cash in lieu of New Common Stock.  

A copy of the Term Sheet is available for free at:

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

If the Debtors do not agree to file an amended chapter 11 plan
based on this Term Sheet, the Creditors' Committee will ask the
U.S. Bankruptcy Court for the Southern District of New York for
permission to file and prosecute to confirmation a Plan based on
this Term Sheet.

Headquartered in Coudersport, Pennsylvania, Adelphia
Communications Corporation (OTC: ADELQ) is the fifth-largest cable
television company in the country.  Adelphia serves customers in
30 states and Puerto Rico, and offers analog and digital video
services, high-speed Internet access and other advanced services
over its broadband networks.  The Company and its more than
200 affiliates filed for Chapter 11 protection in the Southern
District of New York on June 25, 2002.  Those cases are jointly
administered under case number 02-41729.  Willkie Farr & Gallagher
represents the ACOM Debtors.


AEROCENTURY CORP: Lenders Agree to Renew Revolving Credit Facility
------------------------------------------------------------------
AeroCentury Corp. (ASE: ACY), an independent aircraft leasing
company, reached agreement as of Nov. 4, 2004, with its credit
facility lenders to renew the maturity date of the facility to
Oct. 31, 2005. The agreement also revised certain pricing and
covenant provisions. In addition, it contained a waiver by the
lenders of the Company's non-compliance with two financial
covenants, which non-compliance arose from the Company's net loss
for the quarter ended Sept. 30, 2004.

The full text of the amendment has been filed in a Form 8-K report
with the Securities & Exchange Commission, and is available
through the Internet at the SEC's EDGAR system. The filing can
also be accessed by clicking "Investor Relations" on the Company's
home page at http://www.aerocentury.com/and then selecting "SEC  
Filings."

                        About the Company

AeroCentury is an aircraft operating lessor and finance company
specializing in leasing regional aircraft and engines utilizing
triple net leases. The Company's aircraft and engines are on lease
to regional airlines and commercial users worldwide.


AFFINIA GROUP: Moody's Places Single-B & Junk Ratings on Debts
--------------------------------------------------------------
Moody's Investors Service assigned initial ratings to the
acquisition financing of the Cypress Group's purchase of the
Automotive Aftermarket Group from Dana Corporation. The business
will be renamed Affinia Group Inc.  

The senior implied rating will be B2, which will also be applied
to the $300 million seven-year, senior secured, first lien term
loan and the $125 million six-year, first lien revolving credit
facility.

A Caa1 rating has been assigned to the $300 million senior
subordinated notes due in 2014 to reflect their junior status in
the capital structure.

Affinia is a manufacturer and distributor of a broad range of
brake, chassis and filtration products in the automotive
aftermarket. It is being acquired by the Cypress Group in a
transaction valued at $1,000 million prior to fees and expenses.
The ratings reflect the underlying leverage employed in the
transaction, current pressure on margins from rising raw material
costs, lag times involved to recover these costs through pricing
actions, expectations of additional restructuring expenditures in
the first 12-18 months, fairly high customer concentration, and
potential for margins to deteriorate should market demand trend
toward value products and away from Affinia's premium products.

The ratings also recognize the strong market positions enjoyed by
Affinia in its segments, free cash flow generation capability,
favorable trends in demand for aftermarket parts, and a stable
business with well-established customers and distribution
channels. The speculative grade liquidity rating will be SGL-3
(adequate). The rating outlook is stable. This is the first time
Moody's has rated Affinia's obligations.

These ratings have been assigned:

   * Senior Implied B2
   * $125 million first lien revolver B2
   * $300 million first lien term loan B2
   * $300 million senior subordinated notes Caa1
   * Issuer B3

The subordinated notes will be issued in accordance with Rule 144A
of the Securities Act.  In addition to the above facilities,
Affinia will have a $125 million accounts receivable
securitization facility committed for five years at the closing of
the acquisition.  Approximately $100 million is anticipated to be
utilized under the securitization facility at the close of the
transaction.

Challenges the company could face include:

   (1) margin pressure from rising steel costs;

   (2) presence of significant competitors with broad product
       ranges, which can limit the ability to pass on cost
       increases;

   (3) customer concentration (e.g. in 2003, its two largest
       customers accounted for 32% of revenue);

   (4) the related impact of losing a major distribution customer;

   (5) the significance of price as a buying factor; and

   (6) potential for trends favoring value products compared to
       the company's prevalent position in higher margin premium
       products which may impact profitability and cash flow.

In addition, Affinia's plans call for incremental restructuring
actions in the near term, which will have a cash flow impact, and
will create some execution risk in achieving expected benefits.
Off-balance-sheet financing from the accounts receivable
securitization and operating leases will also raise adjusted
leverage. A seller note in a holding company two levels above the
operating company/borrower level will also be part of the capital
structure. The parts distribution model in North America has
experienced a reduction in the number of distribution points over
the last few years. Affinia has a certain reliance on the "three
tier" traditional model, but also sells through multiple channels
including retail and mass merchants, specialists and original
equipment service providers. Should rationalization in the number
of distribution points and/or a trend toward more "two tier"
distribution resume, Affinia could be negatively impacted.

Affinia will benefit from demographic trends in the North American
automotive fleet of increasing average age of vehicles in the
fleet, higher average miles driven per year, higher number of
vehicles in the fleet, and longer vehicle life prior to scrapping.
The company's product line is focused on repetitive wear and
service requirements, which should enjoy modest growth going
forward. Many of its brands have strong market share and
recognition among professional installers and technicians (e.g. #1
in N. American brake and filtration segments, and #2 in chassis).
As a full line provider, Affinia has some protection from lower
cost manufacturers with limited product range. As one of the
largest participants in the aftermarket segment, Affinia will have
some scale advantages. These include the ability to support
significant distribution operations and an efficient inventory
management system. An experienced management team will continue in
the business, which has benefited from several previous
restructuring actions. Historically, Affinia has generated
material levels of free cash flow and this is expected to
continue, although much higher interest payments will now be
required. The company will have positive tangible net worth, which
will help provide reasonable asset coverage for secured debt.

Affinia's stable outlook flows from the favorable intermediate
term growth prospects and replacement needs of the vehicle fleet
in North America, which historically has not been volatile, from
its strong brand and market share presence, and an expectation of
continued generation of free cash flow. However, the recent severe
weather in the U.S., higher fuel costs with resultant fewer miles
driven and pressure on disposable incomes occurred at the same
time that steel costs were rising. This placed downward pressure
on the company's most recent performance. There also is a time lag
associated with pricing actions designed to recover raw material
costs. Management actions, a recovering U.S. economy favoring
longer term trends, and ultimate psychological acceptance of
higher fuel costs could neutralize these short term pressures over
time, but raise some uncertainty in the near term. Factors that
could lead to favorable rating developments include application of
free cash flow to reduce indebtedness such that total adjusted
debt to EBITDAR would fall closer to 4 times or below, an increase
in market share and operating margins that lifts and sustains EBIT
margins above 8%, and free cash flow to adjusted total debt in the
7% range. Lower sales concentration levels and greater balancing
of the distribution channels would also be viewed as positives.
Conversely, a deterioration in operating margins and cash flow, or
a debt financed acquisition, that raises total adjusted
debt/EBITDAR above 5 times, the loss of a major customer, or lower
market shares would be considered negative developments.
Additional restructuring actions beyond current expectations would
also have downward implications.

Affinia's total adjusted debt (including the receivable
securitization, the present value of operating leases, the seller
note, and expected average use of the revolver)/EBITDAR ratio will
be closer to 4.7 times at closing with balance sheet debt/EBITDA
at approximately 4 times. Restructuring charges and associated
incremental capital expenditures will limit free cash flow in the
first year, but cash flow should improve thereafter. The Cypress
Group's $350 million equity contribution, the $300 million senior
subordinated debt, and the structural and contractual
subordination of the seller PIK note will provide substantial
capital junior to the first lien facilities. Beck/Arnley will be
funded with $25 million of cash at closing with further support
controlled by the terms of the first lien facilities and the
indenture for the notes. Intermediate-term trends could lead to
improved operational results and cash flows after the first year
if restructuring actions take hold.

The first lien facilities will be at the operating company level
with both up-stream guarantees from principal domestic
subsidiaries and a down-stream guarantee from the intermediate
holding company, Affinia Group Intermediate Holdings, Inc.
Substantially all domestic assets of the borrower (shareholdings
in international subsidiaries will be limited to 65%), domestic
guarantors and the parent will be subject to a first lien. While
the guarantor group will have substantial book value of tangible
current assets (approximately $593 million at June 30 prior to
sale of interests in certain receivables to the securitization
conduit) subject to the first lien, use of the revolver will not
be subject to a borrowing base and the securitization vehicle
would be expected to have a more diverse collection of receivables
as well as being over-collateralized. Inventory will also be
spread over some 40,000 SKUs and ten distribution points in the
U.S. As a result, the first lien facilities have been assigned a
B2 rating, level with the senior implied rating, to reflect their
priority in the capital structure. The senior subordinated notes
are unsecured but do have the same collection of guarantors as the
first lien facilities. The subordinated notes have been rated
Caa1, two levels below the senior implied rating. The issuer
rating has been set at B3 to reflect the priority of claims for
senior unsecured debt at the Affinia Group Inc. level.

The SGL-3 rating reflects adequate initial liquidity. Internal
cash flows, which will have some seasonal variation, are expected
to modestly cover working capital and capital expenditure needs in
the first year. External liquidity will come from the unused
portion of the revolver (only $10 million is expected to be drawn
at close with a further $10 million of letters of credit to be
issued) and incremental availability under the securitization
facility. For a $2.1 billion company with seasonal requirements,
planned restructuring activities and stepped-up capital
expenditures in the first year, the liquidity reserve was
considered adequate. Bank financial covenants will include a
debt/EBITDA ceiling, maximum capital expenditures and a minimum
interest coverage ratio. Alternate liquidity will be limited by
the extent of the bank liens over the asset base, but is expected
to provide some carve-outs.

Affinia Group Inc. is a leading designer, manufacturer and
distributor of automotive aftermarket components for passenger
cars, SUVs, light and heavy trucks and off-highway vehicles. Its
principal product range includes brake, filtration and chassis
requirements and is sold across North America, Mexico, Europe and
South America. Its annual revenues are approximately $2.1 billion.


ALEPH MANAGEMENT: Hires Adelman Lavine as Bankruptcy Counsel
------------------------------------------------------------                  
The U.S. Bankruptcy Court for the Eastern District of Pennsylvania
gave Aleph Management Systems, Inc., and its debtor-affiliates
permission to employ Adelman Lavine Gold and Levin as their
general bankruptcy counsel.

Adelman Lavine will:

    a) provide legal advice with respect to the Debtors' powers
       and duties as debtors-in-possession in the continued
       operation of their businesses and management of their
       properties;

    b) take necessary action to protect and preserve the Debtors'
       estates, including the prosecution of action on behalf of
       the Debtors' and the defense of any actions commenced
       against the Debtors;

    c) prepare, present and respond on behalf of the Debtors,
       necessary applications, motions, answers, orders, reports
       and other legal papers in connection with the
       administration of their estates;

    d) negotiate and prepare on the Debtors' behalf, a plan of
       reorganization, a disclosure statement, and all necessary
       agreements and documents, and take any necessary action on
       behalf of the Debtors to obtain confirmation of the plan
       and disclosure statement;

    e) attend meetings and negotiations with representatives of
       creditors and other parties in interest and advise and
       consult the Debtors on the conduct of their bankruptcy
       cases;

    f) advise the Debtors with respect to bankruptcy law in the
       aspects of any proposed sale or other disposition of assets
       as well as efforts to obtain financing;

    g) consult with the Debtors' management in connection with:

        (i) any actual or potential transaction involving the
            Debtors, and

       (ii) the operating, financial and other business matters
            relating to the ongoing activities of the Debtors;

    h) attend and participate in any creditors committee meeting
       as requested by the Debtors; and

    i) perform any other legal services for the Debtors in
       connection with their chapter 11 cases, except for those
       legal services requiring specialized expertise in which
       Adelman Lavine is not qualified to render.

Gary D. Bressler, Esq., a Shareholder at Adelman Lavine, discloses
that the Firm received a $140,000 retainer.  

Mr. Bressler will bill the Debtors $390 her hour for his services.

Mr. Bressler reports Adelman Lavine's lead professionals bill:

    Professional            Designation    Hourly Rate
    ------------            -----------    -----------
    Alan I. Moldoff         Principal         $335
    Robert Lenahan          Associate          290
    Jennifer Hoover         Associate          175
    Jonathan Stemerman      Associate          165

Mr. Bressler reports the Firm's other professionals bill:

    Designation             Hourly Rate
    -----------             -----------
    Shareholders            $335 - 450
    Principals               315 - 335
    Associates               165 - 290
    Legal Assistant          125 - 150

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

Headquartered in Lafayette Hill, Pennsylvania, Aleph Management
Systems, Inc. provides ground transportation services on a
contractual basis. Its areas of business are paratransit, charter,
bus, and school bus transportation, and it also provides financial
and risk management services to various companies. The Company and
its debtor-affiliates filed for chapter 11 protection on October
15, 2004 (Bankr. E.D. Pa. Case No. 04-33939). Alan I. Moldoff,
Esq., and Gary D. Bressler, Esq., at Adelman Levine Gold & Levin,
represent the Debtors in their restructuring efforts. When the
Company filed for protection from its creditors, it listed
estimated assets of more than $10 million and estimated debts of
more than $50 million.


ALEPH MANAGEMENT: Gets Interim Okay to Use Cash Collateral
----------------------------------------------------------            
The Honorable Stephen Raslavich of the U.S. Bankruptcy Court for
the Eastern District of Pennsylvania gave Aleph Management
Systems, Inc., and its debtor-affiliates permission, on an interim
basis, to use cash collateral securing repayment of prepetition
obligations to their primary lender, General Electric Capital
Corporation.

The Debtors need access to the cash collateral to avoid immediate
and irreparable harm to their estate and to pay for their ongoing
operating expenses, including payroll, payment to vendors to
ensure a continued supply of materials and services essential to
their operations, and to maintain business operations.  Without
immediate access to cash, the reorganization will fail.

The Debtors owe General Electric more than $34 million under
various lending facilities.  General Electric asserts liens and
security interests in substantially all of the Debtors' assets,
including machinery, equipment, inventory and accounts receivable.

The Debtor adds that the Internal Revenue Service and the
Pennsylvania Department of Revenue have asserted liens and
security interests in certain of Aleph Management's debtor-
affiliates, including cash collateral.

The Court granted the Debtors permission to use their secured
creditors' cash collateral through November 14, 2004.  The cash
must be used in accordance with a budget, subject to a 10%
variance.  The Court will schedule a hearing to consider the
Debtors' motion to use the cash collateral on a permanent basis
after November 14, 2004.

To adequately protect their interests, General Electric, the
Internal Revenue Service and the Pennsylvania Dept. of Revenue are
granted a dollar-for-dollar replacement lien and security interest
in the Debtors' post-petition cash collateral.

Headquartered in Lafayette Hill, Pennsylvania, Aleph Management
Systems, Inc. provides ground transportation services on a
contractual basis. Its areas of business are paratransit, charter,
bus, and school bus transportation, and it also provides financial
and risk management services to various companies. The Company and
its debtor-affiliates filed for chapter 11 protection on October
15, 2004 (Bankr. E.D. Pa. Case No. 04-33939). Alan I. Moldoff,
Esq., and Gary D. Bressler, Esq., at Adelman Levine Gold & Levin,
represent the Debtors in their restructuring efforts. When the
Company filed for protection from its creditors, it listed
estimated assets of more than $10 million and estimated debts of
more than $50 million.


AMERICAN ACHIEVEMENT: S&P Revises Outlook on Ratings to Negative
----------------------------------------------------------------
Standard & Poor's Ratings Services revised its outlook on Austin,
Texas-based American Achievement Corp. to negative from stable.

At the same time, Standard & Poor's affirmed its ratings on the
company, including the 'B+' corporate credit rating. In addition,
Standard & Poor's assigned its 'B+' corporate credit rating to AAC
Group Holding Corp. and assigned its 'B-' rating to AAC HoldCo's
$85 million senior discount notes due 2012, reflecting the
structural subordination of the notes to other indebtedness at
AAC. The company expects to pay a dividend to its equity holders
with the proceeds of AAC HoldCo's notes issue. AAC HoldCo is a
parent company of AAC. AAC has $415 million in debt, pro forma for
the notes issue.

"The outlook revision reflects additional leverage in the capital
structure, an aggressive financial policy as evidenced by the
dividend, and diminished financial flexibility at the current
ratings level," said Standard & Poor's credit analyst Emile
Courtney.

AAC is a leading manufacturer of class rings, yearbooks,
graduation products, and affinity jewelry.

Standard & Poor's expects AAC to reduce its very high leverage
levels through a combination of debt repayment and EBITDA
improvement. Failure to achieve the expected reduction in leverage
would result in lower ratings.


ASSET BACKED: Fitch Slices Class B-1F's Rating to 'BB+' from 'BBB'
------------------------------------------------------------------
Fitch Ratings has taken rating actions on the following Asset
Backed Securities Corp. home equity issues:

   * Series 1999-LB1 group 1

     -- Class A-1F affirmed at 'AAA';
     -- Class A-2F affirmed at 'AAA';
     -- Class B-1F downgraded to 'BB+' from 'BBB'.

   * Series 1999-LB1 group 2

     -- Class A-3A affirmed at 'AAA';
     -- Class A-4A affirmed at 'AAA';
     -- Class A-5A affirmed at 'AAA';
     -- Class B-1A downgraded to 'BB' from 'BBB'.

   * Series 2001-HE1

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

   * Series 2001-HE3

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

   * Series 2002-HE1

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

   * Series 2002-HE2

     -- Class A-1 affirmed at 'AAA';
     -- Class A-2 affirmed at 'AAA';
     -- Class M-1 affirmed at 'AA';
     -- Class M-2 affirmed at 'A';
     -- Class B affirmed at 'BBB';

   * Series 2002-HE3 Pool 1

     -- Class l-M2 affirmed at 'A';
     -- Class l-M3 affirmed at 'BBB';
     -- Class l-M4 affirmed at 'BBB-'.

   * Series 2002-HE3 pool 2

     -- Class ll-A affirmed at 'AAA';
     -- Class ll-M1 affirmed at 'AA';
     -- Class ll-M2 affirmed at 'A';
     -- Class ll-M3 affirmed at 'BBB';
     -- Class ll-M4 affirmed at 'BBB-'.

   * Series 2003-HE1

     -- Class A-1 affirmed at 'AAA';
     -- Class A-2 affirmed at 'AAA';
     -- Class A-3 affirmed at 'AAA';
     -- Class A-4 affirmed at 'AAA';
     -- Class M-1 affirmed at 'AA';
     -- Class M-2 affirmed at 'A';
     -- Class M-3 affirmed at 'BBB';
     -- Class M-4 affirmed at 'BBB-'.

   * Series 2003-HE2

     -- Class A-1 affirmed at 'AAA';
     -- Class A-2 affirmed at 'AAA';
     -- Class M-1 affirmed at 'AA';
     -- Class M-2 affirmed at 'A';
     -- Class M-3 affirmed at 'A-';
     -- Class M-4 affirmed at 'BBB';
     -- Class M-5 affirmed at 'BBB-'.

   * Series 2003-HE3

     -- Class A-1 affirmed at 'AAA';
     -- Class A-2 affirmed at 'AAA';
     -- Class M-1 affirmed at 'AA';
     -- Class M-2 affirmed at 'A';
     -- Class M-3 affirmed at 'A-';
     -- Class M-4 affirmed at 'BBB';
     -- Class M-5 affirmed at 'BBB-'.

   * Series 2003-HE4

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

   * Series 2003-HE5

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

   * Series 2003-HE6

     -- Class A-1 affirmed at 'AAA';
     -- Class A-2 affirmed at 'AAA';
     -- Class A-3A affirmed at 'AAA';
     -- Class A-3B affirmed at 'AAA';
     -- Class M-1 affirmed at 'AA';
     -- Class M-2 affirmed at 'A';
     -- Class M-3 affirmed at 'A-';
     -- Class M-4 affirmed at 'BBB+';
     -- Class M-5 affirmed at 'BBB';
     -- Class M-6 affirmed at 'BBB-'.

   * Series 2003-HE7

     -- Class A-1 affirmed at 'AAA';
     -- Class A-2 affirmed at 'AAA';
     -- Class A-3 affirmed at 'AAA';
     -- Class M-1 affirmed at 'AA';
     -- Class M-2 affirmed at 'A';
     -- Class M-3 affirmed at 'A-';
     -- Class M-4 affirmed at 'BBB+';
     -- Class M-5 affirmed at 'BBB';
     -- Class M-6 affirmed at 'BBB-'.

All of the mortgage loans in the aforementioned transactions
consist of fixed-rate and adjustable-rate mortgages extended to
subprime borrowers and are secured by first and second liens,
primarily on one- to four-family and multifamily properties.

The upgrades reflect a substantial increase in credit enhancement
relative to future loss expectations and affect $270,447,930 of
outstanding certificates. The affirmations reflect credit
enhancement consistent with future loss expectations and affect
$3,497,610,189 of outstanding certificates. Downgrades relate to
increasing concern due to high levels of nonperforming assets, as
well as diminishing credit enhancement and affect $20,636,539 of
outstanding certificates.

                           Downgrades

As of the October 2004 distribution date, the pool factor (current
mortgage loans outstanding as a percentage of the initial pool)
for the series 1999-LB1 group1 was 16.61%, the three-month average
monthly loss after application of monthly excess spread was
$92,663, leaving approximately 5.9% credit enhancement for B-1F.
Current and 12-month averages of 90 plus delinquencies (including
bankruptcies, foreclosures, and real estate owned) stand at 19.57%
and 20.25%, respectively.

The pool factor for series 1999-LB1 group 2 was 6.87%; the three-
month average monthly loss after application of excess spread was
$121,713, leaving approximately 5.29% of credit enhancement for B-
1A. Current and 12-month averages of 90 plus delinquencies stand
at 28.29% and 29.85%, respectively.

                            Upgrades

As of the October 2004 distribution date, the current pool factor
for series 2001-HE1 was 11.81%, the three-month average monthly
gain after application of excess spread and current losses, stands
at $379,965. Currently class M-1 is benefiting from 44.71% credit
enhancement, in the form of overcollateralization and
subordination (originally 11.01%).

The pool factor for series 2001-HE3 was 16.30%; the three-month
average gain after losses was $804,055. Class M-1 currently
benefits from 29.95% credit enhancement (originally 5.50%), class
M-2 currently benefits from 14.61% credit enhancement (originally
3.00%), and class B is benefiting from 3.07% credit enhancement
(originally 0.50%).

The pool factor for 2002-HE1 was 21.92%, the three-month average
gain after losses was $221,162. Class M-1 benefits from 57.04%
credit enhancement (originally 12.50%). Class M-2 benefits from
30.80% credit enhancement (originally 6.75%).

Fitch will continue to closely monitor these deals.


ASTROPOWER INC: Confirmation Objections Must Be Filed by Tuesday
----------------------------------------------------------------
The Honorable Mary F. Walrath of the U.S. Bankruptcy Court for
the District of Delaware will convene a confirmation hearing on
Dec. 2, 2004 at 11:30 p.m., to consider the merits of the chapter
11 plan filed by AstroPower, Inc.

The Confirmation Hearing may be continued from time to time by
announcing the continuance in open court or in a hearing agenda.  
Additionally, the Plan may be modified, if necessary, pursuant to
11 U.S.C. 1127, prior to, during, or as a result of the
Confirmation Hearing, without further notice to parties in
interest.

                  Confirmation Objection Deadline

Written objections, if any, to confirmation of AstroPower's Plan
must be filed on or before Nov. 16, 2004, and served on:

   (1) AstroPower, Inc.
       110 West Ninth Street, #453
       Wilmington, Delaware 19801
       Attn: Eric I. Glassman

   (2) Morris, Nichols, Arsht & Tunnell
       1201 North Market Street
       P.O. Box 1347
       Wilmington, Delaware 19899
       Attn: Derek C. Abbott, Esq.
       Gregory T. Donilon, Esq.

   (3) Landis Rath & Cobb LLP
       919 Market Street, Suite 600
       P.O. Box 2087
       Wilmington, Delaware 19899
       Attn: Adam G. Landis, Esq.
       Kerri K. Mumford, Esq.

                 -- and --

   (4) Office of the United States Trustee
       844 King Street, Room 2207
       Wilmington, Delaware 19801
       Attn: Joseph McMahon, Esq.

Headquartered in Wilmington, Delaware, AstroPower Inc., produced
the world's largest solar electric (photovoltaic) cells and a full
line of solar modules.  The Company filed for chapter 11
protection on February 1, 2004 (Bankr. Del. Case No. 04-10322).  
Derek C. Abbott, Esq. at Morris, Nichols, Arsht & Tunnell,
represents the Debtor.  When the Company filed for protection from
its creditors, it estimated debts and assets of more than $100
million.


ATA AIRLINES: Asks Court to Approve Indiana's $15.5M Financing
--------------------------------------------------------------
As reported in the Troubled Company Reporter yesterday, the
Indiana Transportation Finance Authority -- ITFA, with the
financial support of the City of Indianapolis, authorized a
$15.5 million financing backed by more than $50 million in ATA
Airlines, Inc.'s assets.  

                       Fund-Raising Drive

Coincident with their bankruptcy filing, the Debtors discussed the
procurement of adequate postpetition financing from third party
lenders.  James M. Carr, Esq., at Baker & Daniels, in
Indianapolis, Indiana, relates that the Debtors' existing cash on
hand will not be sufficient to fund their restructuring process.  
The combination of a DIP lending facility and the sale of their
operations at Midway International Airport in Chicago to AirTran
Airways, Inc., provides the Debtors liquidity and business
arrangements that will allow them to continue normal airline
operations for the foreseeable future and provide a springboard
for their successful reorganization.

The Debtors approached a number of other financial institutions
including Abelco Finance LLC, Wells Fargo/Foothill Capital, Boeing
Capital, LaSalle National Bank and most other major financial
institutions with headquarters or regional offices in Indianapolis
about providing postpetition financing.  The Debtors subsequently
determined that the proposal from the Indiana Transportation
Finance Authority is the most favorable and best addressed their
postpetition financing needs.

                       $15,500,000 DIP Loan

The Debtors ask the Court for authority to enter into a
$15,500,000 DIP financing transaction with the Indiana
Transportation Finance Authority.

The Debtors will use the loan proceeds to finance working capital
and other general corporate obligations.

The salient provisions of the DIP Financing Transaction are coded
in an Outline of Terms and Conditions for $15.5 Million "DIP
Financing Transaction" dated November 9, 2004.

ATA Airlines, Inc., is the borrower and the rest of the Debtors
serve as guarantors.

                       Financing Structure

The DIP Financing Transaction is structured as a sale/lease/
repurchase to allow the Authority to issue one or more notes to
Bank One, N.A., to fund the DIP Financing Transaction pursuant to
Indiana Code 8-21-12-11(14), (16) and (20) and IC 8-21-12-6.

Specifically, the DIP Financing Transaction contemplates:

   (i) a sale, free and clear of liens, of certain property by
       ATA to the Authority for $15,500,000 in cash, less fees
       and expenses;

  (ii) the lease of the Property from the Authority to the
       Indianapolis Airport Authority;

(iii) the sublease of the Property from IAA to ATA; and

  (iv) a repurchase of the Property by ATA from the Authority at
       Maturity.

ATA will sell:

   (1) Expendable Parts and General Inventory, with net book
       value at September 30, 2004, of $51,476,029;

   (2) Titled motor vehicles -- ATSB Lenders did not perfect
       prepetition security interests in these items of
       equipment -- and a few aircraft engines;

   (3) Proceeds from 50% membership interests in BATA Leasing,
       LLC, a Delaware limited liability company with ATA and
       Boeing Capital Corporation as members.  ATA's membership
       interest had a book value at September 30, 2004, of
       approximately $13,000,000;

   (4) General intangibles, including state tax refunds, general
       refunds for overpayments made to airport authorities,
       amounts owed for advances to employees -- approximately
       $700,000 plus at present -- and future refunds for excise
       and other taxes pre-paid by ATA on tickets sold but not
       yet flown, and membership list of Ambassadair Travel Club.
       ATA trade marks are part of the general intangibles;

   (5) Cash refunds from collateral deposits pledged to National
       City Bank of Indiana as security for letters of credit,
       including letters of credit issued to workmen's
       compensation insurers; and

   (6) J9 engines for 727's having value of $1,000,000 to
       $1,500,000.

                             Maturity

The DIP Loan will mature on the first to occur of:

     * February 15, 2005;

     * a closing of the AirTran Transaction or an alternative
       transaction;

     * a default declared by the Authority based on a material
       uncured default by any of the Debtors;

     * the termination of any definitive agreement entered into
       with respect to a Transaction that has been approved by
       the Court, as the highest or best proposal -- unless ATA
       can demonstrate that a Transaction will likely be timely
       closed under a back-up proposal authorized by the
       Transaction Order;

     * the termination of any Debtors' ability to use the ATSB
       Lenders' cash collateral pursuant to the Court's Cash
       Collateral Order; or

     * the occurrence of a material default by any Debtor under
       the Cash Collateral Order and the filing of a motion by
       the ATSB with the Court seeking relief from the automatic
       stay.

If Maturity occurs prior to a closing of a Transaction, the
Authority will sell or otherwise liquidate the remaining Property
in a commercially reasonable manner -- including sale to ATA.  The
Authority's claim will be reduced by net proceeds received through
the sale or other liquidation of the remaining Property.

The Debtors are not aware of any reason that a Transaction cannot
be closed before February 15, 2005.  The Debtors will use their
best efforts to close a Transaction before that date.

The Loan will incur interest at LIBOR plus 50 basis points.

                       Priority of Payment

Pursuant to Section 364(c)(1) of the Bankruptcy Code, the Debtors
will grant to the Authority priority in payment with respect to
all obligations of ATA to the Authority, over any and all
administrative expenses.

The payment to the Authority, however, will be subject to a
$500,000 Carve-Out for U.S. Trustee fees under 28 U.S.C. Section
1930(a)(6), fees to the Clerk of Court, and fees for Chapter 11
professionals.

To secure their obligations, the Debtors will grant to the
Authority:

    -- a perfected first priority lien in and against:

       (a) all of the proceeds from any assumption and assignment
           or other disposition of any lease for any airport
           facilities at airport terminals or other agreements
           related to the operation or occupancy of those airport
           facilities or from the closing of a Transaction; and

       (b) the Property,

       provided, however, that the Authority will not receive
       liens or security interests in the airport facilities
       themselves or the lease for those airport facilities; and

    -- a perfected junior priority lien in and against all other
       assets of the Debtors other than the Excluded Assets.  The
       replacement liens granted to the ATSB Lenders by the
       Interim Cash Collateral Order in the property in which the
       ATSB Lenders did not hold a valid perfected lien at the
       Petition Date are limited to any diminution that may occur
       in the cash collateral or other prepetition collateral of
       the ATSB Lenders.  If and to the extent ATA has, at any
       time prior to satisfaction of all obligations to the
       Authority contemplated by the Term Sheet, cash and
       receivables -- other than credit card receivables --
       having a value in excess of the value of the ATSB Lenders'
       cash collateral at the Petition Date -- and other ATSB
       Lenders' collateral has not been diminished by ATA's use
       -- then the Authority will hold a first lien in and
       against the excess cash and receivables.

The Authority's security interests will not extend or apply to any
interest of the Debtors in:

   (1) any aircraft, engine, or parts to the extent that asset
       constitutes equipment within the scope of Section 1110(a)
       of the Bankruptcy Code;

   (2) any other assets with respect to which the granting of any
       security interests would cause a default, directly or
       indirectly, of any agreement related to the Section 1110
       Assets, other than a default arising from a negative
       pledge or similar provision in any Section 1110 Agreement
       with respect to otherwise unencumbered property;

   (3) deposits of cash and Cash Equivalents made by the Debtors
       in the ordinary course of business; and

   (4) the Carve-Out.

The Excluded Assets:

   (i) any retainers paid or deposited before the Petition Date
       by the Debtors to or with their professionals for
       professional services and expense reimbursement in
       connection with the Chapter 11 cases; provided, however,
       that the security interests attach automatically to any
       reversionary or residual interest any Debtor may have in
       the retainer;

  (ii) any Trust Funds;

(iii) the Debtors' avoidance actions and proceeds thereof; and

  (iv) credit card receivables, but only to the extent the ATSB
       Lenders do not have a security interest therein.

                        Fees and Expenses

The Debtors will reimburse all reasonable expenses incurred by the
Authority in negotiating and preparing the Term Sheet and related
Documents, as well as the fees and other reasonable expenses
incurred in connection with the transactions contemplated by the
Term Sheet and the Note issuance to Bank One, including the fees
and reasonable expenses of:

   (i) Bank One, including a 25 basis point facility fee
       ($38,750) payable at closing;

  (ii) Krieg DeVault LLP, special counsel to the Bank;

(iii) Ice Miller, special counsel to the Airport Authority; and

  (iv) Barnes & Thornburg, bond and special counsel to the
       Authority.

           Special Covenants & Incentive Contingent Fee

According to Mr. Carr, the Authority, the City of Indianapolis and
the IAA are largely motivated to enter into the DIP Financing
Transaction to create and retain jobs, maintain the Debtors'
headquarters operations, protect the IAA's valuable relationship
with ATA, and preserve and protect passenger airline service in
Fort Wayne, Indianapolis and South Bend.

To this end, the Debtors covenant with the Authority to use their
best efforts to:

    -- close the AirTran Transaction or an Alternative
       Transaction substantially similar to the AirTran
       Transaction by February 15, 2004; and

    -- effect a reorganization plan that reasonably assures the
       State of Indiana, the City of Indianapolis and the IAA
       that:

       (a) ATA will continue to operate as a high quality low
           fare air carrier providing scheduled airline passenger
           service, civilian charter service and military charter
           service;

       (b) The Debtors will continue to be headquartered in
           Indianapolis;

       (c) The Debtors' reorganization plan will be Indiana
           focused.  ATA will continue to maintain substantial
           hub operations at the Indianapolis International
           Airport;

       (d) For so long as it is financially feasible, ATA will
           continue to provide airline passenger service to and
           from Fort Wayne and South Bend.  ATA will consider
           providing airline passenger service to Evansville,
           Gary and Terre Haute, Indiana;

       (e) Upon the effective date of the reorganization plan,
           the Debtors will employ in connection with their
           airline operations not less than 1,000 persons; and

       (f) The Debtors will not use proceeds from the Authority's
           purchase of the Property to pay retention bonuses for
           the Debtors' management.

The Authority agrees that the closing of the AirTran Transaction
or an Alternative Transaction substantially similar to the AirTran
Transaction will not be deemed to preclude the Debtors from
achieving the Operation and Employment Goals.

The Debtors will be obligated to pay a $1,500,000 Contingent
Incentive Fee from the proceeds of any Alternative Transaction,
which would preclude them from achieving the Operations and
Employment Goals.

                  Request for Expedited Hearing
                      and Interim Authority

Mr. Carr tells Judge Lorch that the DIP Financing Transaction is
urgently needed to allow the Debtors to operate and proceed toward
a Transaction.

As a result, the Debtors ask the Court to hold a hearing on
November 15, 2004, to consider their request.

Pending a Final Hearing, the Debtors seek permission to "borrow"
up to $15,500,000 under the DIP Facility on an interim basis.

This will enable the Debtors to access cash, maintain ongoing
operations, and avoid immediate and irreparable harm and prejudice
to their estates and all parties-in-interest, Mr. Carr. Explains.

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 October 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: Wants to Employ Baker & Daniels as Lead Counsel
-------------------------------------------------------------
ATA Airlines and its debtor-affiliates seek the United States
Bankruptcy Court for the Southern District of Indiana's authority
to employ Baker & Daniels as their lead attorneys.

ATA Holdings Corp. Executive Vice-President and Chief
Restructuring Officer Gilbert F. Viets relates that the Debtors
selected Baker & Daniels as counsel because of its considerable
experience in bankruptcy matters.  Moreover, Baker & Daniels has
represented the Debtors in the ordinary course of their businesses
on a wide variety of matters for several years before the Petition
Date.

Baker & Daniels will:

  (a) prepare and file the Debtors' Chapter 11 petitions;

  (b) seek approval of debtor-in-possession financing;

  (c) give the Debtors legal advice with respect to their Chapter
      11 rights, powers and duties, and continued operation of  
      their business and management of their property as debtors-
      in-possession;

  (d) represent the Debtors in the Chapter 11 cases and in any
      adversary proceeding commenced in or in connection with the
      Chapter 11 cases;

  (e) prepare, on behalf of the Debtors, applications, answers,
      proposed orders, reports, motions and other pleadings and
      papers that may be required in the Chapter 11 cases;

  (f) provide legal assistance and advice to the Debtors in   
      connection with the preparation and submission of a
      Chapter 11 plan;

  (g) cooperate with any special counsel employed by the Debtors
      in connection with the Chapter 11 cases; and

  (h) perform any other legal services that may be required by
      the Debtors or the Bankruptcy Court.

Stephen A. Claffey, James M. Carr, Terry E. Hall, and Melissa M.
Hinds of Baker & Daniels will render services to the Debtors.

Mr. Viet informs the Court that the Debtors will employ Baker &
Daniels on an hourly fee basis, plus reimbursement of all actual
and necessary expenses.  The Debtors have paid a $1,500,000
retainer to Baker & Daniels.

James M. Carr, a member of Baker & Daniels, assures the Court that
the Firm does not represent any interest materially adverse to the
Debtors' estate.  However, Mr. Carr discloses that the Firm
previously represented these entities, in matters totally
unrelated to the Debtors:

     * KeyBank, N.A.,
     * Union Planters Bank, N.A.,
     * General Electric Company and its subsidiaries, and
     * National City Bank of Indiana.

Mr. Carr further notes that on July 29, 2004, Baker & Daniels sent
an engagement letter to the City of Chicago.  In the absence of
any activity regarding the matters described in the engagement
letter, on October 13, Baker & Daniels sent a notification to the
City of Chicago that the Firm closed its file with the City of
Chicago and declined to go forward with representation of the City
of Chicago.  

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


ATA AIRLINES: Wants to Hire Ponader & Associates as Co-Counsel
--------------------------------------------------------------
ATA Airlines and its debtor-affiliates want to employ Ponader &
Associates, LLP, as co-counsel in their Chapter 11 cases.

According to ATA Holdings Corp. Executive Vice-President and
Chief Restructuring Officer Gilbert F. Viets, Ponader will assist
Baker & Daniels in:
    
   (a) preparing and filing the Debtors' Chapter 11 petitions;
   
   (b) seeking approval of a DIP financing;

   (c) advising the Debtors with respect to their Chapter 11
       rights, powers and duties, and continued operation of
       their business and the management of their property as
       debtors-in-possession;
   
   (c) representing the Debtors in the Chapter 11 cases and in
       any adversary proceeding commenced in or in connection
       with the Chapter 11 cases;

   (d) preparing, on the Debtors' behalf, applications, answers,
       proposed orders, reports, motions and other pleadings and
       papers that may be required in the Chapter 11 cases;

   (e) preparing and submitting a Chapter 11 plan; and
    
   (f) cooperating with any special counsel employed by the
       Debtors in connection with the Chapter 11 cases.

The Debtors will compensate Ponader for its services on an hourly
fee basis.  The Debtors have paid a $15,000 retainer to the Firm.

Wendy W. Ponader, sole member of the Firm, assures the Court that
the Firm does not own or represent any interest materially adverse
to the Debtors' estate.  In addition, the Firm has no present
connection with Debtors' estates, their creditors or any other
party-in-interest or their attorneys or accountants.  

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


AXCESS INT'L: Sept. 30 Balance Sheet Upside-Down by $3.9 Million
----------------------------------------------------------------
AXCESS International Inc. (OTC Bulletin Board: AXSI.OB), a leading
provider of Active RFID solutions to the security, supply chain
and sensing industries, reported results for the three months
ended September 30, 2004.

"During the third quarter we saw continued solid financial
progress and further traction with our development of channel
partners and new product rollout," commented Allan Griebenow,
President & CEO of AXCESS. "With our sales and marketing
organization now built out, we are making good progress in further
developing relationships with our channel partners and additional
security-focused systems integrators. We are experiencing
heightened awareness in both the federal and enterprise markets of
the benefits of active RFID. In addition to the increasing level
of inquiries related to homeland defense, we are now seeing
interest in the ROI benefits of active RFID for supply chain
management and enterprise security applications. As such, we are
optimistic about the growing momentum of opportunity in our key
markets."

                  Other Financial Information

Preferred stock dividend requirements for the three months ending
September 30, 2004 were $81,735 compared to $70,490 in the second
quarter of 2004 and $101,401 for the third quarter in 2003.

Research & development (R&D) expenses for the third quarter
totaled $176,791, compared to $166,534 in the second quarter of
2004, and $164,054 in the year-ago period. On a year-over-year
basis, the dollar increase in R&D is due to the Company's
continuing focus on developing new products.

Selling, marketing, general & administrative (S, M, G&A) expenses
for the third quarter totaled $563,248, compared to $634,025 in
the second quarter of 2004, and $440,810 in the prior year period.
The year-over-year increase in absolute dollars is primarily due
to the Company's increased headcount and focus on strategic sales
and higher marketing costs for brand awareness.

                           Business Mix

RFID revenue increased to $251,788 for the three months ended
September 30, 2004 compared to $195,300 in the second quarter of
2004 and $134,020 for the third quarter in 2003. The year-over-
year and sequential increase is due to the Company's growing
traction and focus in the active RFID market.

                       Product Developments

During the third quarter, the Company announced the general
availability of a number of new products based upon its patented
battery-powered RFID long-range wireless tagging technology. In
October the Company announced its unique, distributed ammonia
detection and alerting system, which provides constant monitoring
of harmful gas levels from sources which would be potentially
toxic or explosive, if undetected leaks occur.

In September the Company launched its unique, distributed
radiation detection and alerting system. This system provides
constant monitoring for harmful gamma radiation emitting from
sources such as those that might be used in a terrorist "dirty
bomb" attack.

The Company also announced in September the availability of a
complete sensor monitoring system using radio frequency
identification tags. AXCESS' battery-powered "active" RFID tags
transmit data from a variety of portable detectors including
temperature, motion, pressure as well as hazardous condition
sensors such as radiation, chemical, and biological. The
monitoring system, called OnlineSupervisor(TM) dynamically
interprets the data and sends wireless alerts to enable rapid
response. The system is ideally suited to homeland defense
applications and industrial monitoring industries.

                             Outlook

"We continue to tightly manage our expenses and have reduced our
cash usage to under $200,000 per month in the third quarter of
2004 and have also continued to reduce our level of outstanding
debt," stated Allan Frank, Chief Financial Officer. "With our
operating infrastructure built out and a highly leverageable
business model, we are in a strong position to maintain our
progress towards achieving sustainable profitable growth. Based on
our current expectations we expect to reach cash flow breakeven on
a run rate basis in the first half of 2005."

                  About AXCESS International Inc.

AXCESS International Inc. (OTC Bulletin Board: AXSI),
headquartered in greater Dallas, TX, provides Active RFID (radio
frequency identification) and video surveillance systems for
physical security and supply chain efficiencies. The battery-
powered (active) RFID tags locate, identify, track, monitor,
count, and protect people, assets, inventory, and vehicles.
AXCESS' Active RFID solutions are supported by its integrated
network-based, streaming digital video (or IPTV) technology. Both
patented technologies enable applications including: automatic
"hands-free" personnel access control, automatic vehicle access
control, automatic electronic asset management, sensor management,
and network-based security surveillance. AXCESS is a partner
company of Amphion Capital Partners LLC.

At Sept. 30, 2004, AXCESS International's balance sheet showed a
$3,866,802 stockholders' deficit, compared to a $2,992,025 deficit
at Dec. 31, 2003.


BM USA: Texas Bankruptcy Court Confirms Plan of Reorganization
--------------------------------------------------------------
The U.S. Bankruptcy Court for the Eastern District of Texas
confirmed the Second Amended Plan of Reorganization of BM USA
Incorporated and its debtor-affiliates during the confirmation
hearing held on Nov. 8, 2004.  

BM USA is the U.S. subsidiary of Bruno Magli S.p.A., the Italian
luxury shoemaker whose primary investor is the Bulgari-sponsored
private equity fund, Opera.

BM USA is now set to complete its reorganization and emerge from
Chapter 11 protection within 30 days.

The Plan had the support by:

   (1) the Committee of Unsecured Creditors,

   (2) a contingent of Italian vendors holding approximately
       $2.67 million in claims,

   (3) LaSalle Business Credit LLC, and

   (5) the Debtors' parent, Bruno Magli S.p.A., which will be
       investing additional capital as part of the Plan.

One creditor, Peter Grueterich, who holds a claim that was
temporarily allowed for voting purposes for $200,000, voted to
reject the Plan.  The Debtors heavily dispute the claim, which
arises out of a management agreement between Mr. Grueterich and BM
USA.  The Debtors say Mr. Grueterich breached the Management
Agreement by operating a side business out of its warehouse and
converting company property for purposes of running that business.  
The Debtor says Mr. Grueteric's claim should be disallowed.  The
Debtor also wants Mr. Grueterich to return approximately $14.5
million it says was a fraudulent conveyance.

                         Voting Summary

Holders of Convenience Claims and General Unsecured Claims were
the only classes entitled to vote for or against the Plan.  Both
classes overwhelmingly voted in favor of the Plan.  

In the Convenience Class, eight ballots were cast.  The eight
ballots, which represented $14,119 in claims, all voted to accept
the plan.

In the General Unsecured Class, 31 ballots were received. Of
these, 30 ballots, totaling $24,926,422, were cast in favor of the
Plan.  One ballot -- Mr. Grueterich's -- was cast against the
Plan.  Thus, 96.77% of the number of ballots cast in this class
and 99.2% of the total dollar amount represented by ballots cast
in this class voted in favor of the Plan.  

                       Terms of the Plan

Under the Plan, the Debtors' unsecured creditors will receive a
payout totaling 60% of the face amount of the claims in five equal
payments made every six months and beginning on the Plan's
effective date.  The Plan also calls for substantive consolidation
of the Debtors for distribution purposes and emergence of the
Debtors in their current corporate structure.  Under the Plan, BM
S.p.A., which holds the largest unsecured claims against the
Debtors, will receive all equity in Reorganized BM USA in exchange
for:

   (1) a $1,500,000 contribution on the Effective Date,

   (2) classification of default amounts owing under the licenses
       as General Unsecured claims,

   (4) deferral of payment on its unsecured claims until other
       General Unsecured creditors are paid (including the default
       amounts under the licenses, totaling approximately
       $30 million),

   (5) a $4 million payment guarantee to be made by the Debtors
       under the Plan, and issuance of a letter of credit to
       secure the final two distributions under the Plan.  

The $1.5 million infusion will be used, in part, to fund the Plan.

Under the Plan, the Debtors will waive all actions arising under
Sections 547, 548, and 550 of the Bankruptcy Code, except for
actions against Mr. Grueterich.  The agreement to waive these
avoidance actions came about, in part, through negotiations with
the Committee.  The Debtors believe that the value of continued
business relationships with potential preference defendants, most
notably short-term credit transactions with important Italian
vendors, is far greater than any potential recovery on any
avoidance actions.  The Debtors' creditors ultimately benefit from
the increased value of the reorganized enterprise brought about,
in part, from increased cash flow due to the availability of trade
credit.

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

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

                    About BRUNOMAGLI S.p.A.

BRUNOMAGLI S.p.A., interprets the luxury of Italian style through
its exceptionally fine handcrafted shoes and accessories.  The
label offers its sophisticated and fashion conscious clientele
seductive selections of extraordinary comfort and style that is
contemporary and innovative.

                          About Opera

Opera, the Bulgari sponsored private equity fund, is the first
investment company to focus on Made in Italy manufacturing and
service companies, where being Italian lends a competitive edge.
Opera invests in companies with a secure product equity and a
successful brand name (that are in need of management and
financing support).  An investment vehicle controlled by Opera
acquired BRUNOMAGLI S.p.A., and since early 2002 has been involved
in the strategic oversight of the Company.

Headquartered in Carlstadt, New Jersey, BM USA Incorporated is
engaged into a business of crafting shoes that began in Bologna,
Italy in the 1930's in a family-owned and operated basement
workshop.  The Company, together with two of its affiliates, filed
for chapter 11 protection on April 14, 2004 (Bankr. E.D. Tex. Case
No. 04-41816).  J. Mark Chevallier, Esq., and David L. Woods,
Esq., at McGuire, Craddock & Strother represent the Debtors in
their restructuring efforts.  When the Debtors filed for
protection from their creditors, they estimated over $10 million
in total debts and assets.


BOISE CASCADE: Completes Tender Offer & Consent Solicitation
------------------------------------------------------------
Boise Cascade Corporation, n/k/a OfficeMax(R) Incorporated (NYSE:
OMX), has successfully completed the cash purchase of various
series of securities subject to the company's previously announced
tender offers for a total price of $1.171 billion, including
approximately $125 million of premiums. The company has also paid
accrued and unpaid interest on all tendered securities up to, but
not including, Nov. 5, the settlement date.

A total of $1.046 billion aggregate principal amount of the
various series of securities was tendered on or prior to the
expiration date of 5 p.m., Eastern Time, November 4, 2004. As a
result of the completion of the tender offer for its Senior
Floating Rate Debentures due 2006, certain restrictive covenants
limiting the company's financial flexibility will no longer be in
effect with regard to the Floating Rate Debentures. OfficeMax also
sought consents, as part of the tender process, to allow it to
amend the indentures for its 6.50% Senior Notes and its 7.00%
Senior Notes to remove certain similar restrictive covenants. The
company has obtained the consents with regard to its 6.50% Senior
Notes. The company did not receive the requested consents with
regard to the 7.00% Senior Notes, so it is taking steps to achieve
additional covenant flexibility through other avenues. OfficeMax
does not expect the terms of those securities to be an impediment
to returning a portion of its forest products asset disposition
proceeds to its shareholders.

The securities included in the offers, the principal amount
tendered prior to the expiration date and the principal amount
remaining outstanding are:

                                   Principal             Principal
                                      Amount             Remaining
Title of Security                  Tendered           Outstanding
-----------------                  --------           -----------
6.50% Senior Notes
    due 2010                    $286,320,000           $13,680,000

7.00% Senior Notes
    due 2013                     $93,607,000          $106,393,000

7.05% Notes due 2005           $106,028,000           $43,972,000

7.43% Notes due 2005            $12,679,000            $5,826,000

7.48% Notes due 2005             $1,281,000           $22,019,000

7.50% Notes due 2008           $120,344,000           $29,656,000

9.45% Debentures
    due 2009                    $114,293,000           $35,707,000

7.45% Notes due 2011            $49,600,000              $400,000

7.90% Notes due 2012            $17,000,000           $35,000,000

7.35% Debentures
    due 2016                    $100,156,000           $24,844,000

Senior Floating Rate
    Debentures due 2006         $144,500,000           $28,000,000

                        About the Company

OfficeMax is a leader in both business-to-business and retail
office products distribution. OfficeMax delivers an unparalleled
customer experience -- in service, in product, in time savings,
and in value -- through a relentless focus on its customers. The
company provides office supplies and paper, technology products
and solutions, and furniture to large, medium, and small
businesses and consumers. OfficeMax customers are served by more
than 40,000 associates through direct sales, catalogs, the
Internet, and more than 900 superstores. The business had sales of
$6.6 billion in the first nine months of 2004.

                          *     *     *

As reported in the Troubled Company Reporter on Oct. 11, 2004,
Moody's Investors Service assigned the ratings to Boise Cascade,  
LLC.

Ratings assigned:

   -- Senior implied rated Ba3

   -- Senior unsecured issuer rating rated B1

   -- $1.33 billion guaranteed senior secured term loan B due
      2011 rated Ba3

   -- $1.225 billion guaranteed term loan C due 2010, rated Ba3

   -- $350 million revolving credit facility due 2010, rated
      Ba3

   -- $250 million guaranteed senior unsecured notes, due 2012
      rated B1

   -- $400 million guaranteed senior subordinated notes due 2014
      rated B2

Speculative Grade Liquidity rating rated SGL-2

The outlook is stable.

The Ba3 senior implied rating reflects:

   (a) the company's high debt level (pro forma for the
       transaction),

   (b) the commodity focus and associated pricing volatility of
       the company's core paper and forest products,

   (c) the significant competitive pressures in the paper and
       forest products industry, steadily increasing input
       costs, and

   (d) the uncertainty in regards to the planned monetization of
       timberlands.


CANWEST MEDIA: Moody's Upgrades Senior Secured Rating to Ba2
------------------------------------------------------------
Moody's Investors Service:

   (1) confirmed the Ba3 senior implied rating of CanWest Media
       Inc.,

   (2) raised CanWest's senior secured rating to Ba2 from Ba3,

   (3) raised CanWest's senior unsecured and issuer ratings to Ba3
       from B1,

   (4) confirmed CanWest's B2 senior subordinated rating, and

   (5) assigned a B2 senior subordinate rating to the exchange
       offering of CanWest's parent, 3815668 Canada Inc., which
       will shortly merge with CanWest and become senior
       subordinated debt of CanWest itself.  

The outlook for all ratings is stable.

This action concludes the ratings review commenced last month,
which was prompted by Holdco's debt exchange offer and plan to
subsequently merge Holdco into CanWest, which will effectively
merge CanWest's junior subordinated debt into its senior
subordinated debt.  The senior implied rating continues to be
supported by:

   (1) strong market position in both Canadian TV broadcasting and
       Canadian newspapers,

   (2) financial flexibility provided by still significant non-
       core assets,

   (3) diversity of cash flows, and

   (4) continuing debt reduction efforts.

The senior implied rating is constrained by

   (1) a high debt level coupled with minimal free cash flow,

   (2) significant exposure to advertising volatility, and

   (3) reduced profitability from Canadian TV broadcasting due to
       increased competition from both conventional and specialty
       TV.

The stable rating reflects Moody's expectation that CanWest will
continue to operate its two main Canadian businesses relatively
efficiently while recognising the cyclical nature of year-to-year
results, while debt will continue to be reduced from a combination
of free cash flow aided by a significant reduction in interest
expense and management's ongoing willingness to sell assets to
reduce leverage. The ratings would be considered for upgrade if
the company is able to increase the relationship of free cash flow
to debt towards 10%. The ratings would be considered for downgrade
if CanWest is unable to generate free cash flow and reduce debt on
a sustainable basis.

The senior secured debt has been notched up one level from the
senior implied rating as Moody's estimates that the ratio of all
senior secured claims (including secured swap exposure, letters of
credit and outstanding debt) at the end of F2004 to trailing
EBITDA (including dividends received, and pro-forma for the
divestiture of the New Zealand and Irish assets) was about 2.3X.
Moody's is also no longer concerned that CanWest might use
additional borrowings at this senior level to repay the Holdco
notes.

The senior unsecured debt is now rated at the same level as the
senior implied rating, as the Holdco notes have been refinanced
below this debt level and senior debt/EBITDA leverage is less than
3X. This rating also reflects the lack of security to support the
upstream guarantees, unlike the senior secured debt. The senior
subordinated rating is notched two levels below the senior implied
rating because of the subordinated nature of its position against
senior debt. As Moody's had previously anticipated the eventual
refinancing of Holdco's notes above the senior subordinated debt
level, the additional debt at this level did not put pressure on
the senior subordinated rating.

Ratings affected by this action:

   * Senior Implied rating, Ba3, unchanged

   * Senior Secured, rating raised to Ba2 from Ba3:

     -- Revolving Credit Authorization, due November 2006
        C$413 million
     -- Tranche E1, due August 2009 C$ 22 million
     -- Tranche E2, due August 2009 US$488 million

   * Senior Unsecured Notes, rating raised to Ba3 from B1:

     -- 7.625%, due March 2013 US$200 million

   * Issuer rating raised to Ba3 from B1

   * Senior Subordinated Unsecured Notes, rated B2, unchanged:

     -- 10.625% due May 2011 US$467 million
     -- 8%, due September 2012 (rating assigned) US$790 million

CanWest Media Inc. is a newspaper publisher and a radio and TV
broadcaster, with operations in Canada, Australia, New Zealand,
and the Republic of Ireland. CanWest Media is based in Winnipeg,
Manitoba, Canada.


CATHOLIC CHURCH: Mr. DuFresne Told to File Adv. Pro. to Get Info.
-----------------------------------------------------------------
Paul DuFresne reminds Judge Perris that the Archdiocese of
Portland in Oregon claims that a number of real properties it held
in legal title are not actually owned by it, but are held in trust
for other entities.  Portland supplied a list of those properties
along with the Beneficial or Equitable Owner for which Portland
claims to hold each property in trust.

Mr. DuFresne notes that Portland is the sole source of the list.
There is no hint in the property title, no recorded contract, and
no public record or document of any kind which can be utilized to
confirm the assignments of properties to their Beneficial or
Equitable Owners.  There is no way to know if Portland has made
the assignments recently, or if a given property has had multiple
Beneficial or Equitable owners.

Since Portland is the only source of the Beneficial or Equitable
Ownership assignments, Mr. DuFresne asserts that Portland is
obliged to certify that the assignments it provided are correct
and can be relied upon in the future.  The assignment of
Beneficial or Equitable Owners to properties must be certified
correct and then not allowed to change unless a public proceeding
is held to make the new assignment.

Against this backdrop, Mr. DuFresne asks Judge Perris to require
Portland to provide a final version of the Beneficial or
Equitable property assignments to the Court not later than
November 22, 2004.  If a list is not provided to the Court by that
time, then the assignments delineated in Portland's original
disclosure will be considered to be the Final Version.

Mr. DuFresne also asks Judge Perris to bar any changes in the
assignments in the Final Version except by Court order or upon a
Court-approved sale of an assigned property to a new owner in
legal title.

                          *     *     *

"The relief sought by creditor is not available by motion," Judge
Perris rules.

Judge Perris explains that proceedings to determine an interest in
property and to obtain an injunction are adversary proceedings,
which must be commenced by the filing of a complaint.

Accordingly, Judge Perris denies the request without prejudice to
Paul DuFresne's right to commence an adversary proceeding.

Judge Perris further notes that the Official Committee of Tort
Claimants has commenced an adversary proceeding to determine
Portland's interest in its properties.

"[Mr. DuFresne] may want to consider whether his interests are
adequately represented by the Tort Claimants Committee or whether
a motion to intervene pursuant to Fed. R. Bankr. P. 7024 is
appropriate in lieu of a separate adversary proceeding," Judge
Perris adds.

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)


CHATTEM INC: S&P Upgrades Corporate Credit Rating to BB- from B+
----------------------------------------------------------------
Standard & Poor's Ratings Services raised its ratings on Chattem
Inc., including its corporate credit to 'BB-' from 'B+'.

At the same time, the ratings were removed from CreditWatch where
they had been placed on August 27, 2004.  The outlook is stable.  

At August 31, 2004, Chattanooga, Tennessee-based manufacturer and
marketer of branded personal care products had $200 million of
debt outstanding.

"The upgrade is based on Chattem's improved operating performance
and the company's pending settlement of litigation relating to its
Dexatrim products," said Standard & Poor's credit analyst Patrick
Jeffrey. An order, approving the settlement, is expected to be
entered by the U.S. District Court for the Western District of
Washington in the near term.  

While full funding of all claims may not occur in the near term,
Standard & Poor's does not expect them to have a material effect
on credit protection measures.

The firm reported 7% revenue growth for the 12 months ended of
August 31, 2004. The company's operating margin (excluding D&A)
improved to about 27% for the same period from 26% during fiscal
2003 because of favorable manufacturing costs related to increased
volume and lower operating expenses as a percentage of revenues.


CONSTELLATION BRANDS: Moody's Reviewing Ratings & May Downgrade
---------------------------------------------------------------
Moody's Investors Service placed the ratings of Constellation
Brands, Inc., under review for possible downgrade after analyzing
the preliminary all debt financing options to effect the reported
purchase of The Robert Mondavi Corporation (no rated debt) for
approximately $1.4 billion, including the assumption of debt.
Concerns about the potentially sizable amount of incremental debt
could have an adverse effect on the notching of ratings for
specific debt instruments. Given that there is likely to be a
lengthy time period before the intended purchase documentation is
finalized and executed and given that only cursory projections are
available at this time without full disclosure of integration
costs, synergies, and detailed growth strategies, the ratings have
been placed under review for possible downgrade.

Moody's acknowledges that Constellation's financial performance
prior to the announced Mondavi transaction has been strong and
consistent with expectations. While Constellation's acquisitive
growth strategy was baked into the existing ratings, the magnitude
of the proposed Mondavi transaction along with the implications of
financing choices on the pro-forma capital structure are beyond
Moody's expectations. Moreover, it appears that the Mondavi
transaction may not be significantly accretive to consolidated
pro-forma free cash flow and Constellation's pro-forma free cash
flow as a percentage of total debt is expected to decline to the
high single digits from mid-teens, which is weak for the existing
ratings.

The review for possible downgrade will include, among other credit
and business issues, substantive discussions with the company
about the aforementioned integration strategy, financing
structure, pro-forma free cash flow generation, scheduled debt
reduction, fiscal policy, and the prospects for additional
acquisitive growth.

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

   * Ba1 $1.23 billion credit facility consisting of $400 million
     revolver; $330 million outstanding term A loans, and
     $500 million outstanding term B loans

   * Ba2 $200 million 8.625% senior unsecured notes, due 2006

   * Ba2 $200 million 8% senior unsecured notes, due 2008

   * Ba2 GBP 80 million 8.5% senior unsecured notes, due 2009

   * Ba2 GBP 75 million 8.5% senior unsecured notes, due 2009

   * Ba3 $250 million 8.125% senior subordinated notes, due 2012

   * Ba2 Senior Implied Rating

   * Ba3 Senior Unsecured Issuer Rating (non-guaranteed exposure)

Constellation's SGL-1 Speculative Grade Liquidity Rating was
affirmed on October 26, 2004 (refer to published liquidity
assessment), and will be revisited upon execution of the proposed
Mondavi transaction.

Headquartered in Fairport, New York, Constellation Brands, Inc.,
is a leading international producer and marketer of beverage
alcohol brands with a broad portfolio across the wine, spirits,
and imported beer categories. For the twelve months ended August
31, 2004, net revenue was approximately $3.8 billion. The Robert
Mondavi Corporation, based in Napa, California is a leading
producer and marketer of premium table wines. Its core wine brands
include Robert Mondavi Winery, Robert Mondavi Private Selection,
and Woodbridge, as well as smaller wineries and partnerships
including: Byron, Arrowood, Opus One, Luce, Lucente, Danzante, and
Ornellaia, Sena and Arboleda. The company reported net revenue of
$468 million for the fiscal year ended June 30, 2004.


CORNERSTONE PROPANE: Court Confirms Plan of Reorganization
----------------------------------------------------------
The Honorable Robert D. Drain of the U.S. Bankruptcy Court for the
Southern District of New York confirmed, on Nov. 8, 2004,
Cornerstone Propane, LP, and its debtor-affiliates' Amended Joint
Plan of Reorganization.

Cornerstone's Plan was supported by the Noteholders Committee.   

Under the terms of the Plan:

          * secured debt,
          * seller note claims, and
          * miscellaneous secured claims

totaling approximately $500 million will be converted to equity
and $125 million of new debt in the Reorganized Debtor.  

The current and old partnership interests will be cancelled and
the existing holders will receive no distribution.  Unsecured
creditors will receive their pro rata share on account of their
claims.

The Debtors exit facility will be in the form of a new $50 million
revolving credit facility secured by a first lien on substantially
all of the assets of the Reorganized Cornerstone.

The Debtors want to complete their reorganization prior to the
winter heating season to avoid significant interruptions in their
business operations.  They intend to honor all of their
obligations under existing customer service contracts.

Headquartered in New York, New York, Cornerstone Propane Partners,
L.P. -- http://www.cornerstonepropane.com/-- is the nation's  
sixth largest retail propane marketer, serving more than 440,000
retail propane customers in over 30 states. The Company filed for
chapter 11 protection (Bankr. S.D.N.Y. Case No. 04-13856) on June
3, 2004. Matthew Allen Cantor, Esq., at Kirkland & Ellis LLP,
represents the Company in its restructuring efforts. When the
Debtor filed for protection from its creditors, it listed
$582,455,000 in assets and $692,470,000 in liabilities. The Court
approved the Debtors' Disclosure Statement explaining its Joint
Plan of Reorganization on
Aug. 10, 2004.


D & D WELDING: Case Summary & 20 Largest Unsecured Creditors
------------------------------------------------------------
Debtor: D & D Welding Inc.
        41004 41st Street West
        Lancaster, California 93551

Bankruptcy Case No.: 04-17185

Type of Business: The Debtor is engaged in welding and building
                  infrastructure.

Chapter 11 Petition Date: November 5, 2004

Court: Central District of California (San Fernando Valley)

Judge: Kathleen T. Lax

Debtor's Counsel: Steven R. Fox, Esq.
                  17835 Ventura Boulevard #206
                  Encino, CA 91316
                  Tel: 818-774-3545

Estimated Assets: $50,000 to $100,000

Estimated Debts:  $1 Million to $10 Million

Debtor's 20 Largest Unsecured Creditors:

Entity                        Nature Of Claim       Claim Amount
------                        ---------------       ------------
Taisei Construction Corp.                             $2,000,000
88 South Broadway Ave.
Milbrae, CA 94030

David and Angela McWhirter    Loans, advances           $380,000
41004 41st St. West
Lancaster, CA 93551

California Field Ironworkers  Judgment                  $250,727
Trust Fund
Dept. 7272
Los Angeles, CA 90088

State Comp. Insurance Fund                              $196,934

Brown Strauss                                           $183,152

RB Services                                             $102,149

Patton Sales                                             $66,260

McCarthy Steel                                           $65,104

Metal Works                                              $63,105

Hansen Steel                                             $50,306

Red-D-Arc, Inc.                                          $38,774

BDS Steel Erectors                                       $32,500

Gary Steel                                               $31,129

Airgas                                                   $26,943

Rental Solutions                                         $25,689

United Rentals                                           $19,435

NJ Products                                              $19,026

Hawkeye Equipment                                        $18,362

Bristol                                                  $17,869

Daan                                                     $16,000


DEX MEDIA: Moody's Rates Proposed $200M Senior Unsecured Notes B1
-----------------------------------------------------------------
Moody's Investors Service assigned a B1 rating to Dex Media West
LLC's proposed $200 million issuance of senior unsecured notes due
2011. In addition, Moody's has affirmed all other ratings for Dex
companies, including:

   -- Dex Media, Inc.

      * $523 million 9% senior discount notes, due 2013 -- B3
      * $500 million 8% cash pay unsecured notes, due 2013 -- B3
      * Senior Implied Rating -- Ba3
      * Issuer Rating -- B3

   -- Dex Media East LLC

      * $1.152 billion senior secured credit facility -- Ba2
      * $450 million 9.875% senior unsecured notes, due 2009 -- B1
      * $525 million 12.125% senior subordinated notes, due 2012
        -- B2

   -- Dex Media West LLC

      * $2.030 billion senior secured credit facility -- Ba2
      * $385 million 8.5% senior unsecured notes, due 2010 -- B1
      * $780 million 9.875% senior subordinated notes, due 2013
        -- B2

The rating outlook is stable.

The ratings continue to be pressured by Dex's high leverage, the
willingness of management to effect special dividends to its
sponsors, a slow but manageable erosion of yellow page usage, and
the prospect of heightened competition in all of Dex's markets.
However, the ratings are supported by the operational performance
which Dex has achieved since the acquisition of Dex West in
September 2003, its proven access to the public debt and equity
markets, and Moody's expectation for further deleveraging.

The stable outlook incorporates the reliability and visibility of
Dex's revenues, the resilience of the yellow page advertising
business to economic downturns, and the company's strong free cash
flow generation which provides an opportunity for significant
organic deleveraging. Embedded in the Ba3 senior implied rating is
the expectation that free cash flow generation will continue to
reduce leverage to below 6 times EBITDA by the end of 2005. The
rating also assumes that no incremental debt is raised.

Dex enjoys a fundamentally sound and predictable business model,
which to date has experienced only a modest reduction in market
share, given the company's reputation as the "official" yellow
pages of the incumbent local exchange carrier -- Qwest. Its
operations produce strong EBITDA margins of approximately 60%, and
first half 2004 free cash flow approximating $240 million.
However, the company has tolerated some volatility and
releveraging of its balance sheet by using the proceeds of
incremental debt issued and funds from operations to remit a
substantial level of dividends to its two primary shareholders.
Moody's does not expect to see a continuation of these levels,
post the still recent IPO.

Moody's considers that Dex enjoys adequate liquidity. At the end
of June 2004, Dex recorded approximately $200 million in aggregate
undrawn available revolving credit facilities at Dex East and Dex
West. Given Dex's strong cash flow generation, Moody's does not
project a need for further drawings under these facilities.

Ratings could be upgraded or the outlook revised to positive if
the company uses it strong free cash flow to reduce debt.
Conversely, a negative rating bias might result from acquisition
activity or a significant erosion of market share.

The company intends to use the proceeds from the proposed issue to
retire approximately $200 million of Dex West LLC's senior secured
term loan B bank debt. Accordingly, the transaction is neutral
from a total leverage perspective. Since the substitution of new
unsecured debt for senior secured debt has only a modest effect on
Dex's capital structure composition, there is also no meaningful
impact on the existing notching of the company's individually
rated securities.

The senior secured credit ratings of Dex East and Dex West are
notched up from the senior implied rating in recognition of strong
asset protection metrics. The senior unsecured debt of Dex East
and Dex West is rated one notch below the senior implied rating in
recognition of their ranking below approximately $3.0 billion of
senior secured bank debt. Moody's notes that Dex East carries less
debt and is less leveraged than Dex West. However, Dex East's
lower debt burden and superior asset coverage does not warrant a
rating differential, according to Moody's. The senior unsecured
debt of Dex Media, Inc. is rated B3, reflecting its position as
the most junior debt component in Dex's capital structure.

Through its operating subsidiaries, Dex Media East LLC and Dex
Media West LLC, Dex Media, Inc. is the exclusive publisher of
business telephone directories for Qwest Communications
International. Dex East owns and operates incumbent directories in
7 states - Colorado, Iowa, Minnesota, Nebraska, New Mexico, North
Dakota and South Dakota. Dex West owns and operates incumbent
directories in 7 states - Washington, Oregon, Idaho, Montana,
Wyoming, Utah and Arizona. The company is headquartered in
Englewood, Colorado.


DEX MEDIA: S&P Puts 'B' Rating on Planned $200 Mil. Senior Notes
----------------------------------------------------------------
Standard & Poor's Ratings Services assigned its 'B' rating to Dex
Media West LLC's planned $200 million senior notes issue due 2011.

At the same time, Standard & Poor's affirmed its ratings on the
Denver, Colorado-headquartered company, including its 'BB-'
corporate credit rating.

The rating on Dex West's new senior notes issue is below the
corporate credit rating and reflects the amount of priority debt
in the company's capital structure. Standard & Poor's expects Dex
West to use the notes proceeds to repay part of Dex West's term B
loan, and that the notes issue will not meaningfully affect the
company's financial profile.

The ratings on Dex West are based on the consolidated credit
quality of the company's parent, Dex Media Inc. Dex Media is a
holding company with no direct operations, and it has significant
debt that has to be serviced by the cash flows of its Dex West and
Dex Media East LLC operating subsidiaries. In addition, while Dex
East and Dex West have different financial profiles with separate
financing structures, the operations of both entities are managed
as one company with the same senior management team.

"Ratings stability reflects the expectation that Dex Media's
consolidated financial position will strengthen to levels more
appropriate for the ratings in the intermediate term, as debt is
reduced with the company's discretionary cash flow," said
Standard & Poor's credit analyst Emile Courtney.


DI GIORGIO: S&P Places B+ Rating on CreditWatch Negative
--------------------------------------------------------
Standard & Poor's Ratings Services placed its ratings on Di
Giorgio Corp., including the 'B+' corporate credit rating, on
CreditWatch with negative implications.  Carteret,
New Jersey-based Di Giorgio had $164 million of debt outstanding
as of September 25, 2004.

"The CreditWatch placement reflects Di Giorgio's materially weaker
credit measures and smaller cash flow base due to slower-than-
anticipated progress in attracting new customers to replace the
loss of its client, The Great Atlantic & Pacific Tea Co. Inc.,
late last year," explained Standard & Poor's credit analyst Stella
Kapur.  At the end of the company's third quarter ended
September 25, 2004, trailing-12-month EBITDA was $35 million,
lease-adjusted debt to EBITDA was 5.4x, and last-12-month EBITDA
interest coverage was 2.0x.  Ratings may be lowered by one notch.
Standard & Poor's will resolve the CreditWatch listing after
further discussions with management regarding the company's
strategic and financial plans.


DPL INCORPORATED: Moody's Reviewing Low-B Ratings & May Upgrade
---------------------------------------------------------------
Moody's Investors Service placed the ratings of DPL Inc. and The
Dayton Power and Light Company under review for possible upgrade.  
Ratings placed under review include:

   * DPL's Ba3 senior unsecured debt;
   * DP&L's:

     -- Baa3 senior secured debt;
     -- Ba1 senior unsecured debt; and
     -- Ba1 Issuer Rating;
     -- Ba3 preferred stock; and
     -- Ba3 Not Prime commercial paper rating; and

   * the B1 rating on the trust preferred securities issued by DPL
     Capital Trust II.

The review of DPL's ratings is prompted by the filing of its
overdue 2003 SEC Form 10-K and Form 10-Q's for the first two
quarters of 2004; which included relatively minor restatements of
prior year financial statements. These filings have put the
company back in compliance with financial reporting covenants in
its significant debt agreements, enabled it to resume paying
dividends, and eliminated interest rate step-up provisions that
had been triggered on a number of its debt obligations. The review
is also prompted by company's improved liquidity since April, when
DPL used most of its cash on hand to redeem part of a $500 million
debt maturity at the parent. This improved liquidity has resulted
from solid cash generation thus far in 2004 from regulated utility
DP&L and from DPL's financial investment portfolio. In placing the
ratings under review, Moody's also notes the actions taken by the
Board in putting in place new senior management following an
outside counsel's report to the Audit Committee that was critical
of some practices of the prior senior management team.

The review of utility subsidiary's DP&L's ratings is prompted by
the filing with the SEC of its overdue audited financial
statements for 2003 and the first two quarters of 2004, as well as
the utility's continued strong operating performance, robust cash
flow coverages, and low leverage. The review also takes into
consideration the utility's improved liquidity as a result of the
anticipated renewed access to its $100 million bank revolving
credit facility, which had been precluded while its financial
statements were delayed. DP&L's ability to utilize this credit
facility requires the approval of the Public Utilities Commission
of Ohio (PUCO), which the company expects shortly.

The review of DPL and DP&L's ratings will focus on each entity's
on-going financial flexibility and cash generating prospects; the
ability of DPL to generate cash from sources other than DP&L; each
entity's liquidity position following the resumption of dividend
payments and considering the level of capital calls that could be
required by the financial investment portfolio; the company's
progress in completing the utility plan of protection required by
the PUCO, and any ring fencing provisions that may be put in
place; and developments with regard to the ongoing investigations
of the company by the SEC, Internal Revenue Service, and the
Department of Justice. The review will also consider new
management's strategy with regard to its financial investment
portfolio and its wholesale generation fleet, as well as plans for
reducing parent company debt, improving corporate governance, and
lowering the overall risk profile of the company going forward.

DPL Inc. is a regional energy company operating in the Midwest
through its subsidiaries The Dayton


DYNEGY INC: Completes Sale of Sherman Natural Gas Processing Plant
------------------------------------------------------------------
Dynegy Inc. (NYSE:DYN) has completed the sale of its Sherman
Natural Gas Processing Facility in Sherman, Texas to Dallas-based
Dornick Hills Midstream, Ltd. The transaction resulted in a pre-
tax gain for Dynegy of approximately $17 million.

"Consistent with our self-restructuring approach and goal of
delivering value to investors, this sale was based on a decision
to focus on regions and segments of our natural gas liquids
business where we have a larger physical presence and greater
opportunities for growth," said Bruce A. Williamson, Chairman,
President and Chief Executive Officer of Dynegy Inc. "In addition,
this sale represents one of our last significant divestitures of
non-core assets. With anticipated proceeds of $260 million in
2004, our non-core asset sales have played an important role in
improving Dynegy's financial profile, further reducing debt and
maintaining a strong level of liquidity to support our ongoing
natural gas liquids and power generation businesses."

The Sherman plant has a processing capacity of 24 million cubic
feet of natural gas per day.

Dynegy's natural gas liquids business is engaged in the gathering
and processing of natural gas and the fractionation, storage,
transportation and marketing of natural gas liquids. Key business
hubs include the high-growth gas exploration and production areas
of North Texas and the Louisiana Gulf Coast and the mature Permian
Basin of West Texas and Southeast New Mexico. The company's
natural gas liquids fractionation and storage assets are located
in Mont Belvieu, Texas, and Lake Charles, La.

                        About the Company

Dynegy Inc. provides electricity, natural gas and natural gas
liquids to customers throughout the United States. Through its
energy businesses, the company owns and operates a diverse
portfolio of assets, including power plants totaling 11,885
megawatts of net generating capacity and gas processing plants
that process approximately 1.8 billion cubic feet of natural gas
per day.

                            *   *   *

Dynegy Holdings, Inc., carries Moody's Investors Service's Caa2
senior unsecured rating.  


E-TERRA LLC: Case Summary & 20 Largest Unsecured Creditors
----------------------------------------------------------
Debtor: E-Terra, LLC
        800 East Dimond, Suite 3-470
        Anchorage, Arkansas 99518

Bankruptcy Case No.: 04-01239

Chapter 11 Petition Date: November 8, 2004

Court: District of Alaska (Anchorage)

Judge: Donald MacDonald IV

Debtor's Counsel: Gary C. Sleeper, Esq.
                  Jermain Dunnagan & Owens
                  3000 A Street, Suite 300
                  Anchorage, AK 99503
                  Tel: 907-563-8844
                  Fax: 907-563-7322

Estimated Assets: Unstated

Estimated Debts:  $1 Million to $10 Million

Debtor's 21 Largest Unsecured Creditors:

Entity                                 Claim Amount
------                                 ------------
Jim Rooney                                 $300,000
1600 Scenic Way
Anchorage, AK 99501

Autodesk                                   $224,462
111 McInnes Parkway
San Raphael CA 94903

Frank & Jeanne McQueary                    $175,000
7810 Ascot St.
Anchorage, AK 99502

Charles Forbes                             $111,000

Susan Colligan                             $109,342

Doris Tibbetts                              $95,000

Georgette Sandor                            $68,000

Frank & Jeanne McQueary                     $67,000

Evangeline Jacobs                           $50,000

Legislative Consultants                     $50,000

Westlake Associates, Inc.                   $49,500

Perkins Coie                                $47,627

Steve & Susan Colligan                      $40,000

PTP Management, Inc.                        $35,062

Don Smith                                   $25,000

William F. Wright                           $25,000

MBNA                                        $24,894

MBNA                                        $24,611

Preston Gates & Ellis                       $24,278

Adams & Associates                          $20,945


FRESH CHOICE: Committee Taps Corporate Revitalization as Advisor
----------------------------------------------------------------
The Official Committee of Unsecured Creditors in Fresh Choice,
Inc.'s chapter 11 case asks the U.S. Bankruptcy Court for the
Northern District of California, San Jose Division, for permission
to retain Corporate Revitalization Partners, LLC, as its financial
advisor, nunc pro tunc to September 16, 2004.

The Committee expects Corporate Revitalization to:

     a) conduct business review of Fresh Choice including      
        financial condition, creditor analysis, strategic
        positioning, short term needs, organizational structure
        and cost analysis;

     b) review the Debtor's financial models, cash forecast and
        historical financial and operational performance;

     c) develop and quantify alternative recovery strategies for
        unsecured creditors;

     d) issue brief written reports, as needed, on findings,
        options, and recommendations; and

     e) meet with the Committee, the Debtor and their attorneys
        and advisors, in person via telephone as necessary.

The Debtor will pay Corporate Revitalization's professionals based
on their current hourly rates:

        Professional       Designation          Rate
        ------------       -----------          ----
        Mark Barbeau       Managing Partner     $425
        Scott Avila        Managing Partners     425
        Gene Baldwin       Partner               375
        Todd Bearup        Director              250

The Committee believes that the retention and employment of
Corporate Revitalization is necessary and in the best interests of
the Debtor's unsecured creditors.

Corporate Revitalization discloses that it's providing
restructuring services to Souper Salad -- a competitor in the same
market segment as the Debtor and to a certain extent, in
overlapping geographical markets.  However, the scope of its
engagement is unrelated to the proposed engagement by the
Committee.

Headquartered in Morgan Hill, California, Fresh Choice --
http://www.freshchoice.com/-- owns and operates a chain of
46 salad bar eateries, mostly located in California. The
company filed for chapter 11 protection on July 12, 2004 (Bankr.
N.D. Calif. Case No. 04-54318). Debra I. Grassgreen, Esq., at
Pachulski, Stang, Ziehl, Young, Jones & Weintraub represents the
Debtor in its restructuring efforts. Lawyers at SulmeyerKupetz
represent an official creditors' committee. When the Debtor filed
for protection it listed $29,651,000 in total assets and
$14,348,000 in total debts. At Sept. 5, 2004, Fresh Choice's
balance sheet showed $23.7 million in assets and $21.1 million in
liabilities.


GADZOOKS INC: Files Plan of Reorganization in Texas
---------------------------------------------------
Gadzooks, Inc., filed its Plan of Reorganization with the U.S.
Bankruptcy Court for the Northern District of Texas, Dallas
Division, on Nov. 6, 2004.  

The Official Committee of Equity Security Holders and the Official
Committee of Unsecured Creditors support the Debtor's Plan.

The Plan is the result of extensive negotiations among the Debtor,
the Equity Committee and the Unsecured Creditors Committee.  
Funding of the Plan includes a series of investment transactions
including a new credit facility to be consummated on the Effective
Date and, a rights offering to the equity interest holders.

The Plan provides, among other things, for:

     * a new equity interest subscription and capital      
       contribution of $25 million;

     * payment of between $11 million and $15 million to all
       unsecured creditors subject to the subordination of the
       notes;

     * the potential conversion of noteholder claims into old
       common stock and certain other new common stock
       issuances; and

     * retention by current shareholders of their percentage           
       equity interests in the Reorganized Gadzooks by providing
       shareholders the right to participate in any appreciation
       in the value of new common stock to which they subscribe
       and purchase.

Overall, the Plan addresses the treatment of approximately $44.1
million of aggregate indebtedness, composed of approximately
$100,000 in secured debt and capital leases, $8.0 million in
Unsecured Claims, $14.0 million in Notes, $16.5 million in
estimated Senior Unsecured Claims and $7.5 million in estimated
Administrative Claims including transaction costs.

Headquartered in Carrollton, Texas, Gadzooks, Inc. --
http://www.gadzooks.com/-- is a mall-based specialty retailer  
providing casual apparel and related accessories for youngsters,
between the ages of 14 and 18. 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.


GALEY & LORD: Completes $154 Mil. Asset Sale to Patriarch Partners
------------------------------------------------------------------
Galey & Lord, LLC, a leading global supplier of denim, khaki and
corduroy fabrics for the fashion apparel and uniform markets, has
completed the sale of its assets to Patriarch Partners, LLC, and
that the company's operations have emerged from bankruptcy. The
U.S. Bankruptcy Court for the Northern District of Georgia
approved the sale on Oct. 27, 2004, and it closed on Nov. 9.

As reported in the Troubled Company Reporter on Oct. 29, 2004,
Galey & Lord's estate will receive $40 million in cash in the
transaction, Patriarch will pay $18.5 million of accrued
administrative claims against the estate, and assume or refinance
some other secured obligations, contracts, and employee
obligations. The Official Committee of Unsecured Creditors tried
to block the sale when the value of the transaction decreased at
the eleventh-hour. With no higher or better offer to compete with
Patriarch's offer, notwithstanding a widely publicized auction,
Judge Diehl approved the sale.

Headquartered in Atlanta, Georgia, Galey & Lord, Inc., a leading
global manufacturer of textiles for sportswear, including denim,
cotton casuals and corduroy, and its debtor-affiliates filed for
chapter 11 protection on August 19, 2004 (Bankr. N.D. Ga. Case No.
04-43098). Jason H. Watson, Esq., and John C. Weitnauer, Esq., at
Alston & Bird LLP, and Joel H. Levitin, Esq., at Dechert LLP,
represent the Debtor in its restructuring efforts. When the
Debtor filed for protection from its creditors, it listed
$533,576,000 in total assets and $438,035,000 in total debts.


GENCORP INC: Moody's Junks Planned $50 Mil. Convertible Sub. Notes
------------------------------------------------------------------
Moody's Investors Service assigned a Caa2 rating to GenCorp,
Inc.'s proposed $50 million convertible subordinated notes, due
2024, and a B1 rating to the company's new $175 million senior
secured credit facilities, consisting of a $75 million revolving
credit due 2009 and a $100 million term loan due 2010.  The
proceeds from the new notes and facilities, along with about
$100 million expected from a recently-announced 7.5 million public
share offering as well as cash provided by the recent sale of the
GDX automotive division in August 2004, will be used to re-
purchase part of the company's existing 5-3/4% note (due 2007) and
certain other debt securities, as well as to re-finance its
existing senior secured credit facilities. All other ratings of
the company have been affirmed:

   * Senior implied rating of B2

   * Unsecured issuer rating of B3

   * $150 million 9.5% senior subordinated notes, due 2013, of
     Caa1

   * $150 million 5.75% convertible subordinated notes, due 2007,
     of Caa2

   * $125 million 4% convertible subordinated notes, due 2024, of
     Caa2

The ratings outlook is stable.

The ratings continue to reflect high debt levels that exist on
GenCorp's balance sheet, despite substantial contribution from the
announced equity offering and cash provided by the GDX sale, weak
recent results in the remaining Aerojet segment, and a high level
of reliance on real estate sales for cash flow in the near term.
Ratings also consider the company's leadership position in its
core rocket propulsion segment amidst a strong defense
environment, as well as potential benefits that the company's
substantial real estate holdings provide in terms of both
collateral coverage and cash flow generating potential. The stable
outlook reflects Moody's expectation that the company will be able
to return to positive free cash flow generation in 2005, as the
company increases its deliveries on planned key rocket and missile
platforms, in particular the Atlas V program, on which GenCorp
experienced unusual operating difficulties in 2004. Ratings or
their outlook may be subject to downward revision if free cash
flow were to remain negative over the near term, or if real estate
sales were to fail to contribute at least $10 million to overall
profits on a consistent basis. Conversely, ratings or the outlook
could be revised upward if the company were to illustrate
substantial improvement in operating performance and debt
reduction to levels of less than 5x debt/EBITDA.

Despite the benefits of debt reduction facilitated by the proposed
transactions, Moody's believes that GenCorp will remain heavily
leveraged relative to the cash flow provided by its core Aerojet
business. Moody's estimates pro forma debt to be about $399
million, which represents a reduction of about 30% from $568
million reported on August 2004. However, with the sale of GDX and
re-classification of the company's AFC segment as discontinued
operations, the remaining estimated revenue base (essentially
Aerojet) has been reduced to less than one half FY 2003 levels.
The rating agency estimates pro forma leverage (debt/EBITDA) of
approximately 6.5x as the result of these transactions, although
this metric may be modestly reduced in the near-term by potential
proceeds from the sale of the AFC segment.

Moody's expects improvements in GenCorp's core business operations
in FY 2005 as the company takes advantage of its substantial
market position in its core rocket propulsion business. GenCorp is
one of three leading suppliers of propulsion technology in both
the solid and liquid propulsion markets. This position has been
strengthened over the past year by way of the acquisitions of ARC
Propulsion and certain assets of Pratt & Whitney Space Propulsion.
As of August 2004, the company's aerospace/defense backlog was
$867 million, of which $503 million was funded, which is an
increase from levels of $830 million and $425 million,
respectively, as of November 2003. Moody's believes that this
should result in positive operating cash flows and improved
profitability in FY 2005.

Nevertheless, the ratings still consider the company's reliance on
cash flow from its real estate division in the near future.
Moody's notes the substantial realizable value of the company's
extensive land holdings east of Sacramento, CA, and potential
income that the company plans to generate from these sites. The
company has about 4,100 acres of property for which it has re-
zoning approval currently in process, and GenCorp intends to apply
for additional 1,700 acres before the end of 2004. Moody's notes
the strong real estate market environment that exists in the
Sacramento region. This supports both the land's value as
collateral to the company's secured debt facilities as well as the
likelihood that these properties, once entitled for residential
and commercial usage, can generate significant sales proceeds.
However, market factors will continue to influence the pace at
which the company can monetize these properties.

The B1 rating on the new $175 million senior secured credit
facilities, one notch above the senior implied rating, reflects
their seniority in claim over a substantial amount of subordinated
debt, as well as strong collateral support provided by GenCorp's
assets, particularly real estate holdings. These facilities are
secured by the assets of the company, including 100% of the stock
of domestic subsidiaries, 65% of the stock of foreign subs, with a
first priority security interest in all of the company's tangible
and intangible assets, including real estate. The Caa2 rating on
the proposed $50 million convertible subordinated notes, three
notches below the senior implied rating and the same as the
existing convertible notes' rating, reflect their contractual
subordination to all existing and future senior debt of the
company as well as the lack of guarantees provided by any of the
company's subsidiaries.

GenCorp Inc., located in Rancho Cordova, California, is a leading
technology-based manufacturer of aerospace and defense products
and systems. GenCorp operates a Real Estate segment that includes
activities related to the development, sale and leasing of owned
real estate assets.


GENCORP INC: Fitch Assigns Low-B Ratings to Proposed Loan & Bonds
-----------------------------------------------------------------
Fitch Ratings revised the Rating Outlook on GenCorp Inc. to Stable
from Negative.  Fitch has also assigned a 'BB-' rating to GY's
proposed senior secured bank facility (which will replace the
existing senior secured bank facility), and a 'B-' rating to a
convertible subordinated notes offering due 2024.  Additionally,
Fitch affirms these ratings for GY:

   -- Senior subordinated notes due 2013 'B+';
   -- Convertible subordinated notes due 2007 'B-';
   -- Contingent convertible subordinated notes due 2024 'B-'.

Approximately $705 million in debt securities is affected by these
actions.

The Outlook revision is based on the company's progress in its
transformation plan and its pending recapitalization. In late
2003, GY's management team decided to focus its resources on the
company's aerospace and defense (Aerojet) and real estate
operations. With the sale of GDX and the intended sale of the fine
chemicals business (AFC), which was recently identified as
discontinued operations, management should soon be able to focus
all its efforts on Aerojet, which may include acquisitions, and
developing its real estate assets in the Sacramento area.

GY plans to reduce debt significantly over the coming months
utilizing cash on hand from the sale of GDX (sold in August 2004),
cash from the AFC sale, and $100 million in equity to be issued as
part of the recapitalization. In addition, the company has
announced a private placement offering of up to $75 million in
convertible subordinated notes to reduce cash interest expense and
extend maturities. The notes are expected to be used to repurchase
a portion of the company's convertible subordinated notes due in
2007. The decline in debt and lower interest costs should result
in modest improvements in leverage and interest coverage.

GY's ratings reflect continued solid performance at Aerojet, the
company's sizable real estate portfolio, the overall defense
spending environment, current and expected liquidity position, the
tax shield generated from the GDX transaction, and fully funded
pension plans. In particular, the company's real estate portfolio
(lands that are surplus to Aerojet operations) is a significant
source of security for the bank facility and an expected source of
cash in the coming years. In addition, the value of the portfolio
should increase significantly if GY succeeds as expected in its
efforts to rezone these lands. Rating concerns include the
company's weak free cash flow, high debt levels, potential
environmental liabilities, and pending lawsuits and arbitrations.
Concerns that have been addressed since Fitch's last action on GY
include the closing of the GDX sale and the results of the recent
election.


GENCORP INC: S&P Rates Planned $175M Senior Secured Facilities BB
-----------------------------------------------------------------
Standard & Poor's Ratings Services assigned its 'BB' bank loan
rating and a recovery rating of '1' to GenCorp Inc.'s proposed
$175 million senior secured credit facilities, indicating the high
expectation of full (100%) recovery of principal in the event of
default. Standard & Poor's also assigned its 'B' rating to the
firm's proposed $50 million convertible subordinated notes due
2024 offered under Rule 144A with registration rights, which could
be increased to $75 million via a greenshoe option.

At the same time, Standard & Poor's revised its outlook on the
propulsion supplier to negative from developing. The existing
ratings, including the 'BB-' corporate credit rating, were
affirmed.

"The outlook revision reflects Standard & Poor's determination
that an upgrade was unlikely due to GenCorp's weak financial
profile and the possibility of strategic acquisitions financed at
least partially with debt," said Standard & Poor's credit analyst
Christopher DeNicolo. In addition, consolidated revenues,
earnings, and cash flows over the next few years are likely to be
lumpy depending on the timing and magnitude of real estate
transactions.

The proposed recapitalization is expected to lower leverage and
reduce interest expense from high levels, as well as improve
liquidity. In addition to the new notes and credit facility, the
firm plans to offer 7.5 million shares of common stock (valued at
around $107 million at current prices) plus a 15% greenshoe
option. The proceeds from the sale of the various securities and
cash on hand will be used to refinance the company's existing
credit facility and other debt, and redeem up to $75 million of
5.75% convertible notes, which mature in 2007. Total debt will
decline to approximately $400 million from $568 million at
August 31, 2004, and debt to capital should improve to around 80%
from 100%.

The ratings on Sacramento, California-based GenCorp reflect a weak
financial profile, the likelihood of further debt financed
acquisitions, and a reduced revenue base following the GDX
Automotive divestiture and likely sale of the fine chemicals unit,
offset somewhat by leading positions in aerospace propulsion and
significant real estate holdings. GenCorp's continuing businesses
are Aerojet and the development and sale of real estate. Aerojet
is a leading provider of solid and liquid propulsion for missiles
and space launch vehicles, which comprises essentially all of the
revenues of the company. GenCorp also holds substantial real
estate, subject to environmental restrictions, in varying stages
of remediation and qualification for commercial development. The
revenues from this unit are lumpy as parcels are sold or leased.

Ratings could be lowered if expected improvements in the core
Aerojet business fail to materialize or if significant debt is
taken on to finance an acquisition.


GLOBALSTAR CAPITAL: Court Formally Closes Chapter 11 Proceedings
----------------------------------------------------------------
The Honorable Peter J. Walsh of the U.S. Bankruptcy Court for the
District of Delaware formally closed the chapter 11 proceedings of
Globalstar Capital Corporation and its debtor-affiliates.

Judge Walsh agreed to close the case because the Debtors'
confirmed Plan of Reorganization has been substantially
consummated and all required fees have been paid.

The Debtors' Plan was declared effective on June 29, 2004.  Under
the Plan, Thermo Capital Partners acquired a majority interest in
Reorganized Globalstar.  Thermo owns 81.25% of the new company
that took control of Globalstar's assets and operations, in
exchange for a cash investment of up to $43 million.  The
remaining 18.75% of the equity interests in the new company was
distributed to Globalstar's creditors.  Additionally, Globalstar's
creditors have the right to purchase additional equity interests
in the new company for an aggregate ownership interest of up to
33.87%.

Certain affiliated Debtors were consolidated into Globalstar
Capital Corporation and nothing remains in the estates to be
administered.

Headquartered in San Jose, California, Globalstar, L.P. operates a
worldwide low-earth orbit satellite-based digital
telecommunications system and provides a satellite communications
and communication-related service.  The company filed for chapter
11 protection (Bankr. Del. Case No. 02-10504) on February 15,
2002.  Paul Leake, Esq., and John J. Rapisardi, Esq., at Jones,
Day, Reavis & Pogue and Brendan Linehan Shannon, Esq., at Young
Conaway Stargatt & Taylor LLP, represent Globalstar in its
restructuring.  When the Company filed for protection from its
creditors, it listed $573,431,00 in total assets and
$3,325,553,000 in total debts.


HERBALIFE: Moody's Rates Proposed $225M Sr. Sec. Facility at Ba3
----------------------------------------------------------------
Moody's Investors Service has taken several actions regarding its
ratings on Herbalife International, Inc. and its parent company,
WH Holdings (Cayman Islands) Ltd.:

   (1) assigned a Ba3 rating to Herbalife's proposed $225 million
       senior secured credit facilities and affirmed Herbalife's
       Ba3 ratings on its existing senior secured credit
       facilities;

   (2) affirmed Holdings' Ba3 senior implied rating and revised
       the rating outlook to positive from stable; and

   (3) placed Holdings' B3 senior unsecured ratings and
       Herbalife's B2 senior subordinated rating on review for
       possible upgrade.

The rating assignment, affirmation and outlook revision reflect
the benefits of company's proposed recapitalization, which will
significantly reduce debt and interest expense, and reposition the
capital structure for future deleveraging through bank debt
repayment. These actions also recognize Herbalife's steady
operating performance and strong cash flow generation on a global
basis through June 2004, but are tempered by continued declines in
two of its largest markets and by the use of cash balances in the
transaction that had supplemented the company's modest external
liquidity sources.

Herbalife's senior subordinated notes and Holdings' senior notes
were placed on review for possible upgrade based on the material
reduction in higher priority and pari passu obligations under the
contemplated recapitalization.

These ratings of Herbalife International, Inc. were affected by
this action:

   * $25 million senior secured five-year revolving credit
     facility, assigned at Ba3;

   * $200 million senior secured six-year term loan facility,
     assigned at Ba3;

   * $25 million senior secured revolving credit facility due
     2007, affirmed at Ba3;

   * $120 million senior secured term loan due 2008, affirmed at
     Ba3;

   * $165 million 11-3/4% senior subordinated notes due 2010, B2
     placed on review for possible upgrade.

These ratings of WH Holdings (Cayman Islands) Ltd. were affected
by this action:

   * Senior implied rating, affirmed at Ba3;

   * $275 million 9-1/2% senior unsecured notes due 2011, B3
     placed on review for possible upgrade;

   * Senior unsecured issuer rating, B3 placed on review for
     possible upgrade.

Proceeds from the proposed $200 million term loan along with
$300 million from a planned initial public offering, and
$120 million in balance sheet cash will be used to fund the
retirement of Herbalife's existing senior secured credit
facilities, a $200 million special shareholder dividend, a tender
offer for Herbalife's 11 _% senior subordinated notes, and the
redemption of 40% of Holdings 9 ½% senior notes. Upon
successful completion of the proposed transactions, Moody's will
withdraw the ratings on Herbalife's existing senior secured credit
facilities, upgrade (to B1) and withdraw ratings on Herbalife's
senior subordinated notes, and upgrade to B2 Holdings' senior
unsecured ratings. The substantial dividend and transaction fees
associated with the recapitalization minimize net debt reduction,
and the use of cash balances removes a substantial liquidity
source for the company, leaving a relatively modest $32 million
cash balance and $25 million revolving credit facility.

Nonetheless, the ratings affirmation and outlook revision to
positive reflect the benefits of the transaction, including a
material reduction in funded debt levels and borrowing costs, and
the repositioning of the capital structure towards more easily
reduced bank debt. As a result of the transactions, June 2004 LTM
debt-to-EBITDA is reduced to 2.2x from 3.0x and interest coverage
improves to 5.6x from 3.5x. In the year-to-date period through
June 2004, Herbalife has exceeded expectations with strong growth
in sales and EBITDA, largely due to consultant gains in Latin
America, Europe, and Asia/Pacific regions. However, the company
continues to experience declining operating trends in its two
largest markets, United States and Japan, which represent around
half of its gross sales.

Despite the need for above average statistics to compensate for
substantial business risks and weak assets, Herbalife's pro forma
credit protection measures strongly position the ratings in their
current category. As such, Moody's could consider a ratings
upgrade within a year after the recapitalization if the company
maintains current operating levels and leverage below 2.0x, and
stabilizes its top two markets. In this last regard, Moody's notes
that the company has credible plans to grow in niche market
segments and to invest in tools and marketing programs to increase
distributor recruiting and retention. Importantly, the outlook
revision to positive is contingent on the successful execution of
the proposed recapitalization, and otherwise will revert to
stable. In addition, a stable outlook or other negative rating
actions are possible if operating performance trends falter, if
there are material adverse developments regarding lawsuits,
regulatory investigations or tax audits, or if leverage increases
to fund changing financial and strategic policies. Moody's notes
that the company's strong growth has been aided by favorable
currency rate moves and by promotional activity in Europe, which
could result in more volatile earnings performance going forward.

Herbalife's ratings continue to be supported by its strong cash
flow model, which benefits from low working capital needs (company
receives payment via credit card prior to delivering product),
outsourced production from multiple suppliers, and modest research
and development expenditures. The demographic trends underlying
demand for the company's products are positive. An aging
population, increasing obesity rates, greater acceptance of herbal
and dietary supplements, and growth in worldwide health
expenditures are favorable trends suggesting ongoing fundamental
demand for weight management and nutritional products. In
addition, long-term interest in working at home, self-employment
and supplemental family income has led to high single digit growth
rates for the direct marketing industry, and provides a
sustainable recruiting environment for MLM companies going
forward. Herbalife's franchise value and market position, built
over its twenty-four-year history in these markets, provides a
substantial platform to benefit from these continuing trends. In
addition, the new CEO that was hired in April 2003 has further
strengthened the existing management team with several additional
hires with expertise in the areas of legal, product development,
operations and marketing.

The ratings are restrained by the substantial operating risks that
are associated with selling weight management, nutritional and
other ingested products through an independent, multi-level
marketing (MLM) distributor network of over one million people in
59 countries and the high turnover rates characteristic of MLM
companies. Moody's notes that Herbalife is exposed to regulatory,
legal and publicity risks from both its products and its
widespread business model, which is subject to control concerns
regarding inappropriate marketing practices. Furthermore, the
company faces intense competition from MLM and non-MLM companies
with regard to both its products and ongoing recruiting needs.

The Ba3 rating on the bank credit facilities reflects their senior
position in the capital structure, as well as the benefits and
limitations of support from guarantees and the collateral package.
The credit facilities continue to be guaranteed by certain direct
and indirect subsidiaries and parents, except for foreign
subsidiaries where guarantees would result in adverse tax or other
consequences. The facilities and guarantees continue to be secured
by a first-priority pledge of certain assets and all capital stock
of borrowers and guarantors, and by a 66% stock pledge of non-
guarantor foreign subsidiaries. Moody's notes that 72% of
Herbalife's 2003 sales and 42% of its assets respectively were
derived from and located in foreign jurisdictions. In addition,
Moody's believes that liquid tangible assets are unlikely to
sufficiently cover outstanding balances under the facilities in a
distress scenario. Borrowings are subject to the limitations of
customary negative covenants, and by financial covenants including
maximum leverage ratio, minimum interest expense ratio, and
maximum capital expenditures. Mandatory prepayment provisions
include a 50% excess cash flow sweep.

Herbalife, with corporate headquarters in Los Angeles, California,
is a marketer of weight management products, nutritional
supplements and personal care items, sold through a global network
of independent distributors in 59 countries. Net sales for the
twelve months ended June 2004 were approximately $1.2 billion.


HERBALIFE: S&P Assigns BB- Rating to Proposed $225 Mil. Facility
----------------------------------------------------------------
Standard & Poor's Ratings Services assigned its 'BB-' bank loan
rating to Herbalife International Inc.'s proposed $225 million
credit facility. A recovery rating of '2' was also assigned to the
loan, indicating an expectation for a substantial (80%-100%)
recovery of principal in the event of a default.

Subsequently, all ratings on Herbalife and parent WH Holdings
Ltd., including the 'BB-' corporate credit rating, were placed on
CreditWatch with positive implications. The CreditWatch placement
is based on Herbalife's proposed recapitalization, which is
expected to result in a strengthened financial profile. Upon
completion of the proposed recap transactions, Standard & Poor's
expects to raise the company's corporate credit rating by one
notch to 'BB' with a stable outlook.

Herbalife anticipates using proceeds from a planned IPO (estimated
at about $300 million), borrowings from the proposed term loan of
about $200 million, and cash on hand of about $120 million to fund
debt repayment of approximately $337 million, a $200 million
special dividend, and related expenses and fees. If completed as
proposed, these transactions will result in a significant
reduction in debt leverage, with pro forma total debt to EBITDA
declining to about 2.2x, from 3.3x currently.

Herbalife, a network marketer of weight management products,
nutritional supplements, and personal care products, has a
relatively high business risk. Yet the company also generates
stable cash flow from its geographically diversified operations.
In 2003, Herbalife generated about 37% of its sales from the
Americas, 24% from the Asia/Pacific region, and 39% from Europe.
The direct-selling business model requires low capital investment,
which has resulted in consistent cash flow generation because of
minimal capital requirements and efficient working capital. Still,
the company faces intense competition from other marketers of
weight management products, as well as a high level of competition
from other network marketers to recruit distributors. In addition,
its products are subject to product liability risks, and its
network marketing system is exposed to negative publicity and
regulatory scrutiny.

"The proposed recap strengthens Herbalife's capital structure and
increases its financial flexibility," said Standard & Poor's
credit analyst Ana Lai. "Pro forma debt leverage is expected to
decline significantly, with total debt to EBITDA dropping to about
2.2x from 3.3x currently."


HILL CITY: Hires Orrill Cordel as Bankruptcy Counsel
----------------------------------------------------               
The U.S. Bankruptcy Court for the Eastern District of Louisiana
gave Hill City Oil Company, Inc. permission to employ Orrill,
Cordell & Beary, L.L.C., as its general bankruptcy counsel.

Orrill Cordell will:

    a) give the Debtor legal advice with respect to its powers and
       duties as debtor-in-possession;

    b) provide the Debtor with legal services in relation to the
       continued operation of its business and the management of
       its properties; and

    c) perform all other legal services necessary in the Debtor's
       bankruptcy proceedings.

W. Christopher Beary, Esq., a Manager at Orrill Cordell, is the
lead attorney for Hill City's restructuring.  Mr. Beary discloses
that the Firm has not yet received a retainer from the Debtor for
its services.  For his professional services, Mr. Beary will bill
the Debtor $200 per hour.

Mr. Beary reports that G. Wade Wootan, Esq., and Amy E. Roth,
Esq., are the other attorneys performing services to the Debtor.
Mr. Wootan will bill the Debtor $175 per hour, while Ms. Roth will
charge $150 per hour.

Orrill Cordell assures the Court it does not represent any
interest adverse to the Debtor or its estate.

Headquartered in Houma, Louisiana, Hill City Oil Company, Inc. --
http://www.hillcityoil.com/-- sells industrial oil, metalworking  
fluids, automotive and off-highway lubricants, oilfield products,
and service products. The Company filed for chapter 11 protection
on October 25, 2004 (Bankr. E.D. La. Case No. 04-18007).
W. Christopher Beary, Esq., at Orrill, Cordell & Beary, L.L.C.,
represents the Debtor in its restructuring efforts. When the
Company filed for protection from its creditors, it listed
estimated assets and liabilities of $50 million to $100 million.


HOLLYWOOD CONVENIENCE: Voluntary Chapter 11 Case Summary
--------------------------------------------------------
Debtor: Hollywood Convenience Store, Inc.
        dba Galleria Chevron
        2963 John Hawkins Parkway
        Hoover, Alabama 35244

Bankruptcy Case No.: 04-09878

Type of Business: The Debtor operates a convenience store.

Chapter 11 Petition Date: November 8, 2004

Court: Northern District Of Alabama (Birmingham)

Judge: Thomas B. Bennett

Debtor's Counsel: Frederick Mott Garfield, Esq.
                  Sexton, Cullen & Jones PC
                  2116 10th Avenue, South
                  Brimingham, AL 35205
                  Tel: 205-252-5361

Estimated Assets: $1 Million to $10 Million

Estimated Debts:  $1 Million to $10 Million

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


HOME INTERIORS: S&P Slices Corporate Credit Rating to B- from B
---------------------------------------------------------------
Standard & Poor's Ratings Services lowered its ratings on
decorative home accessories direct seller Home Interiors & Gifts
Inc., including its corporate credit rating to 'B-' from 'B'.

At the same time, Standard & Poor's affirmed its '2' bank loan
recovery rating. The outlook is negative. At June 30, 2004,
Carrollton, Texas-based Home Interiors had about $466.6 million in
debt outstanding.

"The downgrade reflects weaker-than-expected operating performance
for the first half of fiscal 2004 ended June 30 and a limited
cushion under financial covenants. We believe that without a
significant improvement in financial performance in the second
half of the year, the firm might need to seek relief from covenant
violations under its bank facility for the fiscal year ending
December 31, 2004," said Standard & Poor's credit analyst Martin
Kounitz.

EBITDA declined 50% for the first half ended June 30, 2004.
Standard & Poor's believes that industry conditions remain very
challenging and that cash flow relative to the firm's debt burden
will be very weak.

The company's sales are vulnerable to:

   (1) changes in incentives for its sales personnel;
   (2) slight disruptions in the fulfillment of orders;
   (3) the training and experience level of the displayers;
   (4) competition for the recruitment of experienced personnel;
       and
   (5) consumer spending.


IITC HOLDINGS: Winds Up Operations Following Share Distribution
---------------------------------------------------------------
IITC Holdings Ltd. have now completed the distribution of the
216,568 Class "A" Common Shares in the capital of Intermap
Technologies Corporation to its shareholders as the final
distribution of its remaining assets. IITC has applied for and
received its Certificate of Dissolution. The Certificate of
Dissolution is dated October 26, 2004.

                        About the Company

IITC Holdings Ltd., was formerly known as Intera Information
Technologies Corporation. During fiscal 1996 the company sold off
its petroleum and resource management segments and is currently in
liquidation. The company hopes to spin off its mapping segment
during fiscal 1997 to its existing shareholders.


INTERCEPT INC: Fidelity National Closes Stock Acquisition
---------------------------------------------------------
Fidelity National Financial, Inc. (NYSE: FNF), reported the
closing of its acquisition of InterCept, Inc. (Nasdaq: ICPT).
FNF paid $18.90 in cash for each share of InterCept common stock.

InterCept provides both outsourced and in-house, fully integrated
core banking solutions for approximately 425 community banks,
including loan and deposit processing and general ledger and
financial accounting operations. InterCept also operates
significant item processing and check imaging operations,
providing imaging for customer statements, clearing and
settlement, reconciliation and automated exception processing in
both outsourced and in-house relationships for approximately 720
customers.

"We are excited to close the InterCept acquisition and look
forward to working with the more than 1,100 new customers, as well
as the potential revenue synergy opportunities this increased
customer base affords FNF," said FNF Chairman and Chief Executive
Officer William P. Foley, II. "We remain committed to realizing at
least $25 million in cost synergies through our integration
efforts of InterCept into FNF."

As reported in the Troubled Company Reporter on Sept. 13, 2004,
under the terms of the definitive agreement, FNF has the option to
pay the $18.90 consideration in all cash or in a combination of
cash and FNF stock. If FNF elects the stock and cash consideration
option, InterCept shareholders will have the option to elect any
combination of cash and stock, subject to proration such that the
overall limitation for the consideration in the transaction will
be 75% cash and 25% in the form of FNF stock.  The composition of
the $18.90 per share offer will be finalized in the proxy
statement that will be distributed prior to the InterCept
shareholder vote to approve the transaction.  If FNF stock is
issued as consideration, it will be calculated using a trailing
ten-day average determined one day before the closing of the
transaction.

Fidelity National Financial, Inc., number 262 on the Fortune 500,
is a provider of products and outsourced services and solutions to
financial institutions and the real estate industry. The Company
had total revenue of more than $7.7 billion and earned more than
$860 million in 2003, with cash flow from operations of nearly
$1.3 billion for that same period. FNF is a leading provider of
information-based technology solutions and processing services to
financial institutions and the mortgage and financial services
industries through its subsidiary Fidelity Information Services,
Inc. Fidelity Information Services' software processes nearly 50
percent of all U.S. residential mortgages, it has processing and
technology relationships with 45 of the top 50 U.S. banks as well
as more than 3,200 community-based financial institutions and has
clients in more than 50 countries who rely on its processing and
outsourcing products and services. Additionally, Fidelity
Information Services operates a strategic network of 53 image-
enabled item processing centers, placing it among the nation's
leading providers of image- based check processing solutions.

Fidelity National Financial is the nation's largest title
insurance company and also provides other real estate-related
services such as escrow, flood and tax certifications with life of
loan monitoring, merged credit reporting, property valuations and
appraisals, default management, relocation services, flood,
homeowners and home warranty insurance, exchange intermediary
services, mortgage loan aggregation and fulfillment, multiple
listing services software, mortgage loan origination software,
collateral scoring analytics and real property data. More
information about the FNF family of companies can be found at
http://www.fnf.com/and http://www.fidelityinfoservices.com/

                         About InterCept

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

                          *     *     *

InterCept, Inc., disclosed liquidity challenges since late-2002.  
In June, InterCept retained Jefferies & Company, Inc., to explore
strategic alternatives to enhance shareholder value, including a
possible sale of the company.  Fidelity National Financial
advanced its offer to purchase the company in mid-September.  


INTERTAPE POLYMER: Closing Montreal Manufacturing Facility
----------------------------------------------------------
Intertape Polymer Group Inc. (NYSE, TSX: ITP) is closing its
Montreal, Quebec manufacturing facility, another step in the
Company's ongoing plan to lower costs and effectively optimize
inventory investment. Several operations are currently performed
at the Montreal facility, including production of hot melt carton
sealing tape, assembly and distribution of packaging machinery,
regional distribution for a variety of other products, customer
service and finance. Most of these operations will be transferred
to other Company facilities. However, in keeping with the
Company's commitment to provide superior service to its clients,
the customer service, sales and finance groups, which number about
70 employees, will remain in Montreal. In total, the transfer of
manufacturing and distribution operations will affect about 80
employees. The tape manufacturing operations are expected to be
transferred over the course of the next three months and should be
completed in January 2005.

"The Montreal plant is the Company's original manufacturing
facility and operates in two side-by-side buildings that cannot be
combined," said Intertape Polymer Group Inc. (IPG) Chairman and
Chief Executive Officer, Melbourne F. Yull. "The Company's
capacity will not be lowered due to the benefits of recent
initiatives to increase output in other sites." Mr. Yull added:
"We have excellent employees in Montreal and it is unfortunate,
due to site limitations, that the operation cannot be consolidated
and expanded."

There will be one-time charges of approximately $5.1 million
associated with this closure, of which $4.0 million is non-cash.
These charges will be booked in the fourth quarter of 2004.
Combined with the one-time charges associated with the Cumming
facility closing, there will be approximately $8.0 million of one-
time charges in the fourth quarter of 2004, of which $4.7 million
is non-cash.

"The Company expects to realize annualized cost savings of
approximately $4.7 million," said IPG's Chief Financial Officer,
Andrew M. Archibald, C.A. "Combined with the expected cost savings
from the recently announced closure of our Cumming, Georgia
facility, these initiatives are expected to yield about $6.3
million in annualized cost savings. These cost savings will start
to be generated in the first quarter of 2005, and the full impact
on an annualized basis is expected to be realized starting in the
third quarter of 2005."

                        About the Company

Intertape Polymer Group is a recognized leader in the development
and manufacture of specialized polyolefin plastic and paper based
packaging products and complementary packaging systems for
industrial and retail use.  Headquartered in Montreal, Quebec and
Sarasota/Bradenton, Florida, the Company employs approximately
2,600 employees with operations in 16 locations, including 12
manufacturing facilities in North America and one in Europe.

                          *     *     *

As reported in the Troubled Company Reporter on July 06, 2004,
Standard & Poor's Ratings Services assigned its 'B+' corporate
credit rating to St. Laurent, Quebec-based Intertape Polymer Group
Inc.

At the same time, Standard & Poor's assigned its 'B+' bank loan
rating and a recovery rating of '2' to the company's proposed $250
million senior secured credit facilities based on preliminary
terms and conditions. The 'B+' rating and the '2' recovery rating
indicate an expectation of substantial (80%-100%) recovery of
principal in the event of a default.


JAFRA COSMETICS: S&P Affirms Single-B Ratings After Review
----------------------------------------------------------
Standard & Poor's Ratings Services affirmed its 'B+' corporate
credit and 'B-' senior subordinated debt ratings on Jafra
Cosmetics International Inc.

At the same time, the ratings were removed from CreditWatch where
they were placed on March 31, 2004. In addition, the 'B+' senior
secured bank loan rating was withdrawn. The outlook is stable. At
June 30, 2004, Westlake Village, California-based direct seller of
fragrances and cosmetics had about $260 million of debt
outstanding.

"The ratings affirmation follows our review of Jafra in light of
its recent acquisition by unrated, Germany-based Vorwerk & Co. KG.
The affirmed ratings assume no implied financial support from
Vorwerk," said Standard & Poor's credit analyst Patrick Jeffrey.

Jafra continues to maintain stable operations through the recent
acquisition by Vorwerk. The company is expected to maintain
adequate credit protection measures for the rating to mitigate the
business risks associated with the direct selling business model
and high geographic market concentrations.


KAISER ALUMINUM: Court Approves Seventh Amendment to Credit Pact
----------------------------------------------------------------
In a regulatory filing with the Securities and Exchange
Commission, Daniel D. Maddox, Kaiser Aluminum Corporation Vice
President and Controller reported that the Company and its wholly
owned subsidiary, Kaiser Aluminum & Chemical Corporation, and the
lenders under its Post-Petition Credit Agreement completed the
Seventh Amendment to the Credit Agreement.  The Bankruptcy Court
approved the Seventh Amendment on October 28, 2004.  Among other
things, the amendment resets a financial covenant and permits the
sale of Kaiser's interests in and related to Queensland Alumina
Limited.

The Debtors believe that the Credit Agreement would be adequate to
support their liquidity requirements through the remainder of
their Chapter 11 cases -- based on the fact that it was the
commodity assets that subjected Kaiser to the most variability and
exposure from both a price risk basis as well as from an operating
perspective.  While there can be no assurance, based on recent
primary aluminum prices and recent market conditions for
fabricated aluminum products, Mr. Maddox says, the Company
currently expects availability under the Credit Agreement to
remain near or above the $100,000,000 range.

A full-text copy of the Third Amended and Restated Final Order
Authorizing Secured Postpetition Financing on a Super Priority
Basis and Granting Relief From the Automatic Stay, as ordered by
Judge Fitzgerald on October 28, 2004, is available for free at:

    http://bankrupt.com/misc/Kaiser_3rd_Amended_&_Restated_DIP_Financing_Order.pdf

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)


KMART CORP: Balks at Angola Wire's $1,300,000 Claim
---------------------------------------------------
Angola Wire Products, Inc., manufactures wire merchandise display
racks and other metal products used in the commercial display
industry.  On July 26, 2002, Angola filed Claim No. 34123, that
seeks nearly $1.3 million as an unsecured non-priority claim based
on purported contracts with Kmart to provide a variety of metal
storage displays and other metal clips and hangers used to display
merchandise.

Angola has supplied Kmart with racking products for several years.  
Typically, before Kmart buys a particular product from Angola,
Kmart provides Angola with a "Production Commitment," which is a
statement of the quantity of a certain type of product that Kmart
wants Angola to make available over a period of time.

Kmart and Angola would specify a price per unit of the product in
the Production Commitment.  If Kmart wanted to actually purchase
the product identified in a Production Commitment, typically it
would issue a purchase order, which would specify, inter alia, the
amount of product it desired, the price per unit, and the delivery
location for the product.  Pursuant to the Production Commitment,
all purchase orders and commitments were subject to Kmart's
Purchase Order Terms and Conditions.

Typically, Angola would deliver the products indicated in a
Purchase Order and invoice Kmart accordingly.  Kmart would then
make payment to Angola based on the invoice.

There was no master supply contract between Angola and Kmart.
Instead, Kmart's purchase orders and Production Commitments were
governed by Kmart's Terms and Conditions.

The bulk of Angola's claim -- $1,166,722 -- is based on
purportedly "specifically manufactured goods ordered by Kmart
Corporation and produced before the Petition Date for which
contract and delivery was repudiated."  These allegedly
"specifically manufactured goods" comprise approximately 78
different parts used by Kmart in its merchandise display racks.
Some of these parts were manufactured as early as 1996, but were
retained by Angola purportedly to supply Kmart if and when Kmart
issued a purchase order for the product.

The individual product that comprises the largest component of
Angola's claim is a magnetic sign holder.  Angola asserts a claim
for $471,160 for this product.  Angola contends that Kmart made a
contract to purchase 250,000 units at $2 per unit but only used
14,420 units.  Accordingly, Angola asserts a claim for 235,580
units.

                         Kmart's Objection

The threshold issue to be determined by the Court is whether
Kmart entered into a binding contract to purchase all of each
product listed on the attachments to Angola's proof of claim.
More specifically, the issue boils down to whether Kmart became
contractually bound to purchase the product specified on a
Production Commitment.  Kmart contends that under its Terms and
Conditions, Kmart did not become liable for any Angola product
until after:

    -- Kmart issued a purchase order;

    -- the product was shipped to Kmart pursuant to the purchase
       order; and

    -- Angola invoiced Kmart based on the purchase order and the
       shipment of the product.

It is not disputed that as of the Petition Date, Kmart had not
issued purchase orders for any of the product listed on the
attachments to Angola's proof of claim.  Kmart maintains that it
has never paid Angola for inventory without a purchase order being
issued by Kmart and delivery being taken by Kmart.

Angola argues under a course of dealing theory that Kmart was
bound to purchase all products produced by Angola pursuant to a
Production Commitment but not actually ordered by Kmart pursuant
to the purchase order.  There is no document, however, which
evidences this purported agreement between Angola and Kmart.
Indeed, this theory is directly contradicted by Kmart's Terms and
Conditions, which is expressly incorporated into each Production
Commitment.  Although Kmart had on occasion bought-out Angola's
stock of product produced under a Production Commitment but never
ordered by Kmart pursuant to a purchase order, Kmart did not
always pay the full price for the product.  In fact, Kmart often
re-negotiated the price downward from the price identified in the
Production Commitment.  Moreover, Kmart's purchases of product on
re-negotiated terms were always made pursuant to purchase orders.

Angola's claim is also overstated because it fails to recognize
that, after the date of the claim, Kmart purchased some of the
product that is included in the claim.  In addition, Kmart
continues to purchase product previously produced pursuant to a
Production Commitment, thus further reducing any claim of Angola.
Finally, Angola must prove that it has mitigated any damages it
suffered as a consequence of Kmart not purchasing a product
previously produced under a Production Commitment.

                         Issues for Trial

There are numerous issues for trial, including but not limited to:

    (a) Whether a "Production Commitment" formed a contract
        between Angola and Kmart for the purchase of goods;

    (b) If the Court were to find that a Production Commitment
        formed a contract between Angola and Kmart, whether and
        under what terms Kmart was obligated to purchase any
        product produced by Angola under a Production Commitment
        but not otherwise purchased by Kmart pursuant to a
        purchase order, considering the express language of the
        Production Commitment;

    (c) If the Court were to find that a Production Commitment
        does not form a contract between Angola and Kmart, whether
        the goods described in the Production Commitment were
        specifically manufactured, and if not, whether any
        agreement or practice under which Kmart previously bought-
        out product produced by Angola under a Production
        Commitment but not otherwise purchased by Kmart pursuant
        to a purchase order satisfied the statue of frauds under
        Article 2 of the Uniform Commercial Code;

    (d) Whether the purported verbal order for the magnetic sign
        holders, confirmed by electronic mail, satisfied the
        statute of frauds under Article 2 of the Uniform
        Commercial Code;

    (e) Whether and to what extent subsequent purchases or likely
        purchases by Kmart of additional product after Angola
        filed its proof of claim should be deducted from Angola's
        proof of claim; and

    (f) Whether Angola reasonably mitigated its damages by
        attempting to sell to third parties the excess product
        that it manufactured but did not deliver to Kmart.

Headquartered in Troy, Michigan, Kmart Corporation (n/k/a KMART
Holding Corporation) -- http://www.bluelight.com/-- is the  
nation's second largest discount retailer and the third largest
merchandise retailer.  Kmart Corporation currently operates
approximately 2,114 stores, primarily under the Big Kmart or Kmart
Supercenter format, in all 50 United States, Puerto Rico, the U.S.
Virgin Islands and Guam.  The Company filed for chapter 11
protection on January 22, 2002 (Bankr. N.D. Ill. Case No.
02-02474).  Kmart emerged from chapter 11 protection on May 6,
2003.  John Wm. "Jack" Butler, Jr., Esq., at Skadden, Arps, Slate,
Meagher & Flom, LLP, represented the retailer in its restructuring
efforts.  The Company's balance sheet showed $16,287,000,000 in
assets and $10,348,000,000 in debts when it sought chapter 11
protection.  (Kmart Bankruptcy News, Issue No. 84; Bankruptcy
Creditors' Service, Inc., 215/945-7000)


LANCASTER REDEVELOPMENT: S&P Pares Bond Rating to BB+ from BBB-
---------------------------------------------------------------
Standard & Poor's Ratings Services lowered its rating on Lancaster
Redevelopment Agency, California's tax allocation bonds, issued
for the Central Business District redevelopment project, one notch
to 'BB+' from 'BBB-' based on bond counsel's opinion that the
pledged revenue stream is different than figures provided in the
transaction's original official statement and inadequate
recomputed coverage of less than 1x maximum annual debt service by
pledged revenues.

Despite a lack of coverage, the agency has consistently made debt
service payments on the bonds using revenues from other project
areas.

The rating reflects a small project area with previous losses in
assessed valuation, a maximum annual debt service coverage of
0.8x, and a taxpayer concentration at 34% of incremental assessed
value within the 10 leading taxpayers.

A first lien on incremental property taxes derived from the
Central Business District project area, net of housing set-asides,
except for those used to cover a small portion of debt service,
and pass-through payments under agreements with Antelope Water
District and Los Angeles County on behalf of a consolidated fire
protection district, secures the bonds.

The volatility ratio remains average at 0.41 in fiscal 2005, down
from 0.50 in fiscal 1999. The volatility ratio --computed as base
assessed value divided by total assessed value-- indicates the
speed at which tax increment revenues will rise or decline with
small assessed value changes. The additional bonds test is
satisfactory and allows for additional debt issuance if tax
increment revenues, net of pass-through agreements, cover maximum
annual debt service by 1.25x.

The rating action affects roughly $1.8 million of tax allocation
bonds outstanding.


MARINER HEALTH: Faces $10.5M Indemnification Claim from Formation
-----------------------------------------------------------------
Mariner Health Care discloses in a regulatory filing with the
Securities and Exchange Commission that on October 26 and 27,
2004, it received notices from Formation Properties III, LLC, and
its counsel seeking indemnification under an asset purchase
agreement dated as of August 19, 2003, among Formation, Mariner,
and various of its subsidiaries for $10,500,000 plus interest.

Formation purchased a majority of Mariner's Florida facilities in
the fourth quarter of 2003.

In its notice, Formation alleges breaches of representations,
warranties and covenants contained in the Asset Purchase
Agreement with respect to certain financial statements Mariner
delivered pursuant to the Agreement.

The Asset Purchase Agreement limits the amount that Formation can
recover on an indemnification claim to $4,000,000 unless it is
determined that Mariner committed fraud or intentionally and
knowingly made a misrepresentation.  Accordingly, Formation also
alleges that Mariner's actions constituted fraud or an intentional
and knowing misrepresentation.

Mariner is in the process of evaluating Formation's claim.

Mariner Post-Acute Network, Inc., Mariner Health Group, Inc., and
scores of debtor-affiliates filed for chapter 11 protection on
January 18, 2000 (Bankr. D. Del. Case Nos. 00-113 through 00-301).  
Mark D. Collins, Esq., at Richards, Layton & Finger, P.A.,
represents the Reorganized Debtors, which emerged from bankruptcy
under the terms of their Second Amended Joint Plan of
Reorganization declared effective on May 13, 2002.  (Mariner
Bankruptcy News, Issue No. 63; Bankruptcy Creditors' Service,
Inc., 215/945-7000)


MAXIM CRANE: Key Stakeholders Support Plan of Reorganization
------------------------------------------------------------
The United States Bankruptcy Court for the Western District of
Pennsylvania has approved the adequacy of Maxim Crane Works, LLC's
Disclosure Statement in support of its Plan of Reorganization. The
Plan of Reorganization is now fully consensual among all the
Company's key stakeholders. The Court set the confirmation hearing
for December 30, 2004.

By the end of this week, the Company expects to have mailed a
solicitation package to each creditor eligible to vote. Creditors
will have until December 20, 2004, to return their ballots to the
Company's solicitation agent.

"We are very pleased to have reached agreement with our key
stakeholders on our Plan and to receive Court approval to move
forward with the solicitation," said Arthur Innamorato, chief
executive officer of Maxim Crane Works.

"Having achieved this important milestone, we are continuing to
work with Goldman Sachs to complete our exit financing. We are
optimistic Maxim Crane will emerge from Chapter 11 early next year
with a significantly de-leveraged capital structure, positive cash
flow and a well-structured financing package that will allow the
Company to grow and prosper in the coming years."

As reported in the Troubled Company Reporter on Oct. 18, 2004,
Maxim Crane and its debtor-affiliates filed with the U.S.
Bankruptcy for the Western District of Pennsylvania their Amended
Joint Plan of Reorganization. A full-text copy of the Plan is
available for a fee at:

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

Under the terms of the Plan:

      * administrative claims;
      * DIP Facility claims;
      * priority tax claims;
      * other priority claims; and
      * other secured claims

will be paid in full on the Effective Date.

General Unsecured claims will receive, on the Effective Date,
their pro rata share of New Series B Warrants. Equity interests
holders and any stock options, warrants, including the OPCO Note
claims and the HOLDCO Debenture claims will be cancelled and the
Debtors obligations will be discharged.

The Reorganized Debtors will emerge as two separate corporate
entities:

      * Reorganized Maxim Crane Holdings and
      * Reorganized Maxim Crane.

The operation of the Reorganized Debtors will be funded from
existing cash balances and from the Emergence Credit Facility of
$300 million.

The Company has also announced that the Court has approved the
Company's request to suspend a marketing process that the Court
had mandated at a hearing on October 18, 2004. The Creditors'
Committee joined the Company in making that request because it now
supports the Plan as the best alternative for all parties.

Headquartered in Pittsburgh, Pennsylvania, Maxim Crane Works, LLC
-- http://www.maximcrane.com/-- is a full service crane rental  
company. The Company, along with its affiliates, filed for
chapter 11 protection (Bankr. W.D. Pa. Case No. 04-27861) on
June 14, 2004. Douglas Anthony Campbell, Esq., at Campbell &
Levine, LLC, represents the Debtors in their restructuring
efforts. When the Debtors filed for protection from their
creditors, they estimated debts and assets of over $100 million.  
The Company expects to emerge from Chapter 11 early next year.


MCDERMOTT INT'L: Sept. 30 Balance Sheet Upside-Down by $338.4 Mil.
------------------------------------------------------------------
McDermott International, Inc. (NYSE:MDR) reported net income of
$18.3 million for the 2004 third quarter, compared to net income
from continuing operations of $10.1 million for the corresponding
period in 2003. Net income for the third quarter of 2003 was $11.8
million, which included income from discontinued operations of
$1.7 million from Menck GmbH. Weighted average common shares
outstanding on a fully diluted basis were approximately 68.4
million and 66.5 million for Sept. 30, 2004 and Sept. 30, 2003,
respectively.

Revenues in the third quarter of 2004 were $450.2 million,
compared to $645.3 million in the corresponding period in 2003.
The change in revenues is primarily due to the completion of
several large EPIC projects at J. Ray McDermott, S.A. and its
subsidiaries and, secondarily, from reduced billings at BWX
Technologies Inc. as a result of improved efficiencies.

Third quarter 2004 operating income was $39.8 million, which
included $14.1 million of corporate qualified pension expense,
compared to the third quarter 2003 operating income and corporate
qualified pension expense of $8.4 million and $20.7 million,
respectively.

"I am pleased with this quarter for multiple reasons," said Bruce
W. Wilkinson, chairman of the board and chief executive officer of
McDermott. "Both of McDermott's consolidated operating segments
were profitable again this quarter, as well as on a year-to-date
basis. In addition, J. Ray booked over $665 million of work, which
increased its backlog compared to June 30, 2004 and is essentially
equal to year-end 2003 levels. The Company's liquidity position,
and specifically J. Ray's, improved during the quarter. The
projects which had troubled J. Ray for the last several years are
all now delivered to their customers. And, BWXT continues to
produce strong results while driving cost savings and efficiencies
for its customers. While opportunities remain for continued
improvement, I appreciate the results delivered by our team over
the last six months."

                      Results of Operations

2004 Third Quarter Compared to 2003 Third Quarter

Marine Construction Services Segment

Revenues in the Marine Construction Services segment were $325.6
million in the 2004 third quarter, compared to $512.3 million from
a year ago. The year-over-year reduction in revenues resulted
primarily from the completion of several large EPIC projects and
decreased fabrication activity on projects in the Asia Pacific
region and in Louisiana, partially offset by increased activity in
Azerbaijan.

Segment income for the 2004 third quarter was $28.6 million,
compared to $11.9 million in the third quarter of 2003. Major
projects contributing operating income to the 2004 third quarter
were the fabrication projects for BP in Morgan City, La., the
projects in Azerbaijan for AIOC, and work in the Middle East for
Ras Laffan. In addition, J. Ray recognized approximately $20.7
million in aggregate operating income in the third quarter 2004
from various items, primarily gains on sales of assets. J. Ray's
third quarter 2003 operating results included a $19.9 million loss
related to an increase in the expected losses on its spar
projects. Selling, general and administrative expenses were $24.7
million in the 2004 third quarter, compared to $17.7 million in
the 2003 third quarter, due to higher marketing and compliance
expenses.

At Sept. 30, 2004, J. Ray's backlog was $1.4 billion, which
reflects approximately $575 million of new awards and $90 million
of change orders received during the quarter. J. Ray's backlog was
$1.4 billion and $1.5 billion at Dec. 31, 2003 and Sept. 30, 2003,
respectively.

Government Operations Segment

Revenues in the Government Operations segment decreased $8.4
million, to $124.6 million in the 2004 third quarter from $133.0
million in the third quarter of 2003. The decrease was primarily
due to cost savings and efficiencies obtained in the manufacture
of nuclear components for certain U.S. government programs, which
reduced billings.

Segment income increased $7.3 million, to $28.7 million, compared
to the 2003 third quarter, primarily due to increased margins from
the manufacture of nuclear components as a result of cost savings,
increased equity income from investees and approximately $3.8
million of benefit from pension funding reimbursement.

At Sept. 30, 2004, BWXT's backlog was $1.5 billion, compared to
backlog of $1.8 billion and $1.4 billion at Dec. 31, 2003 and
Sept. 30, 2003, respectively.

Corporate

Unallocated corporate expenses were $17.6 million in the 2004
third quarter, a decrease of $7.4 million compared to the 2003
third quarter. Unallocated corporate expense in the third quarter
of 2004 and 2003 included $14.1 million and $20.7 million,
respectively, of qualified corporate pension expense.

Other Income and Expense

The Company's other expense for the third quarter of 2004 was $9.1
million, compared to other income of $6.9 million in the third
quarter of 2003. The $16.0 million year-over-year change is due
primarily to a $4.5 million increase in net interest expense and a
$10.0 million variance, pretax, in the quarterly adjustment
related to increasing the estimated costs of The Babcock & Wilcox
Company ("B&W") Chapter 11 settlement.

Net interest expense was $7.6 million in the 2004 third quarter
compared to $3.1 million in the 2003 third quarter, due to the
issuance of J. Ray's 11 percent senior secured notes in December
2003.

During the 2004 third quarter, revaluation of certain components
of the estimated settlement cost related to the Chapter 11
proceedings involving B&W resulted in an increase in the estimated
cost of the settlement to $130.3 million, resulting in the
recognition of other pretax expense of $0.3 million ($1.1 million
after tax). The increase in the third quarter 2004 estimated
settlement cost is due primarily to an increase in the closing
price of McDermott's common stock from $10.16 per share at June
30, 2004 to $11.80 per share at Sept. 30, 2004. As discussed in
the Company's annual report on Form 10-K for the year ended Dec.
31, 2003, the Company is required to revalue certain components of
the estimated settlement cost quarterly and at the time the
securities are issued, assuming the settlement is finalized.

                  The Babcock & Wilcox Company

The Company wrote off its remaining investment in B&W of $224.7
million during the second quarter of 2002 and has not consolidated
B&W with McDermott's financial results since B&W's Chapter 11
bankruptcy filing in February 2000. B&W's revenues were $279.0
million in the third quarter of 2004, a decrease of $39.5 million
compared to the third quarter of 2003. B&W's net income for the
2004 third quarter was $11.3 million compared to $15.4 million in
the corresponding period in 2003.

Liquidity

The Company, on a consolidated basis, and J. Ray, on a stand-alone
basis, both significantly increased the balances of unrestricted
cash and cash equivalents in the 2004 third quarter. At Sept. 30,
2004, J. Ray's unrestricted cash balance was $141.2 million, an
approximate $48 million improvement compared to June 30, 2004.

As disclosed in our annual report on Form 10-K for the year ended
Dec. 31, 2003, there was substantial doubt about J. Ray's ability
to continue as a going concern, as of that date. Since Dec. 31,
2003, however, J. Ray has implemented a substantial portion of its
plan to address the liquidity issues, including achievement of the
following items since year-end through the date of this report:

   -- Completed the sale of the DB60, for cash proceeds of
      approximately $44 million, however, these proceeds are
      currently restricted to fund J. Ray's capital expenditures
      through July 2005;

   -- Sold the Oceanic 93 for cash proceeds of approximately $18.7
      million. In accordance with the indenture governing J. Ray's
      senior secured notes, J. Ray offered to purchase a portion
      of the notes with these funds. No notes, however, were
      tendered and accordingly, the proceeds became available for
      J. Ray's general corporate purposes;

   -- Achieved substantial completion of its spar projects, Carina
      Aries project and the Belanak FPSO, which together were
      responsible for significant losses in prior quarters and
      resulted in strains on J. Ray's liquidity;

   -- Obtained the completion certificate on the Front Runner
      Spar, which allowed $22 million of previously restricted
      cash to become unrestricted;

   -- Completed a new $25 million letter-of-credit facility which
      released previously restricted cash that secured letters-of-
      credit;

   -- Entered into a $25 million uncommitted credit facility with
      McDermott. This facility has not been utilized or needed to
      date; and,

   -- Implemented cost reductions and downsizing at certain of its
      facilities.

As a result of the successful completion of the aforementioned
items and J. Ray's plans to increase backlog, reduce future costs
where appropriate and continue to improve contract execution
controls, J. Ray now believes it will fulfill its liquidity
requirements throughout the 2005 forecast period, utilizing its
current financing structure. Although J. Ray has improved its
liquidity, various factors could have a negative impact on future
cash flows, including the inability to execute its plans, and
credit risks at one of J. Ray's Mexican joint ventures. On Nov. 3,
2004, J. Ray's available unrestricted cash was approximately $124
million.

                        About the Company

McDermott International, Inc. is a leading worldwide energy
services company. The Company's subsidiaries provide engineering,
fabrication, installation, procurement, research, manufacturing,
environmental systems, project management and facility management
services to a variety of customers in the energy and power
industries, including the U.S. Department of Energy.

At Sept. 30, 2004, McDermott International's balance sheet showed
a $338,421,000 stockholders' deficit, compared to a $363,177,000
deficit at Dec. 31, 2003.


MERISANT WORLDWIDE: Kills Tender Offer & Scraps IPO
---------------------------------------------------
Merisant Worldwide, Inc. (formerly known as Tabletop Holdings,
Inc.) terminated its tender offer and consent solicitation for
its 12-1/4% Senior Subordinated Discount Notes due 2014 (CUSIP
Nos. 87336NAA9 and U81965AA0) and its 9-1/2% Senior Subordinated
Notes due 2013 (CUSIP Nos. 58984WAA5 and U58973AA3) last week.  
HYmarket.com reports the 12-1/2% junk-rated bonds fell 11.5 points
on that news.  

In addition, the Company advised the Securities and Exchange
Commission that it has withdrawn its registration statement on
Form S-1 relating to the initial public offering of its income
deposit securities.

The Company expects to post its results for the quarter ended
September 30, 2004 on its website at http://www.merisant.com/next  
week.  The Company will discuss these quarterly results in a
conference call after they are posted.  The Company will provide
information regarding the schedule for the call and how to access
the call on its website at the time that it posts its third
quarter results later this week.

Merisant Worldwide markets low calorie tabletop sweeteners.  The
company's brands, including Equal(R) and Canderel(R), are sold in
over 85 countries throughout the world.

For the year ended December 31, 2003, Merisant generated net sales
of $352.3 million and a net loss of $17.6 million.  For the three
months ended March 31, 2004, Merisant generated net sales of $77.8
million and a net loss of $4.5 million.  Merisant's March 31,
2004, balance sheet showed $563.0 million in assets and $542.2
million in total debt.


MERISANT WORLDWIDE: CEO Resigns & Is Replaced by Paul Block
-----------------------------------------------------------
Merisant Worldwide, Inc., and its affiliated subsidiaries
appointed Paul R. Block as their new Chief Executive Officer.

Mr. Block, who was previously serving as President and Chief
Operating Officer, will replace Etienne Veber, who has resigned
from the position and as a director of the Company.  Mr. Veber
will be available as a resource to the Board through May 2005.

"Paul Block's leadership experience in the food and beverage
industries is an excellent match for the needs of Merisant as it
continues to expand globally and compete in new markets," Arnold
Donald, Chairman of the Boards of the Company and Merisant,
stated. "Etienne led our various startup strategies across the
world. He leaves us with a strong global foothold and an upgraded
executive team."

"At this time, it is appropriate for me to explore other
opportunities knowing that Merisant is in the right hands for the
future," said Mr. Veber.

"We are grateful to Etienne for his dedication to the company, his
many contributions and wish him continued success in his future
endeavors," added Mr. Donald.

Mr. Block has previously served as President and Chief Executive
Officer of Sara Lee's Coffee and Tea Consumer Brand, where he led
a turnaround in operating performance, and as Chief Marketing
Officer and, subsequently, EVP General Manager of Allied Domecq
Spirits USA, where he was instrumental in the repositioning and
double-digit growth of its Courvosier brand. Additionally, while
at Donone International Brands, Mr. Block launched Dannon bottled
water in the United States, achieving number one market share
after only eight months. He has also held various brand
management, field marketing and sales positions at Guinness Import
and Miller Brewing companies.

Merisant Worldwide (fka Tabletop Holdings) markets low calorie
tabletop sweeteners.  The company's brands, including Equal(R) and
Canderel(R), are sold in over 85 countries throughout the world.

For the year ended December 31, 2003, Merisant generated net sales
of $352.3 million and a net loss of $17.6 million.  For the three
months ended March 31, 2004, Merisant generated net sales of $77.8
million and a net loss of $4.5 million.  Merisant's March 31,
2004, balance sheet showed $563.0 million in assets and $542.2
million in total debt.  The company pulled the plug on an IPO that
would have funded a tender offer for its junk-rated 9-1/2% and
12-1/4% Senior Subordinated bonds.


MICROCELL TELECOM: Forms New Board Following Rogers Acquisition
---------------------------------------------------------------
Microcell Telecommunications Inc. (TSX:MT.RV.A; TSX:MT.NV.B)
Rogers Wireless Inc. (NYSE:RCN; TSX:RCM.B) Rogers Communications
Inc. (NYSE:RG; TSX:RCI).

As a result of the acquisition of Microcell Telecommunications
Inc. by Rogers Wireless Inc., Microcell reported the composition
of its new Board of Directors. The members of Microcell's new
Board of Directors are:

      -- H. Garfield Emerson Q.C.,
      -- George A. Fierheller,
      -- Ann T. Graham,
      -- James C. Grant,
      -- Thomas Ian Hull,
      -- Nadir H. Mohamed,
      -- Pierre L. Morrissette,
      -- David R. Peterson Q.C.,
      -- Ted Rogers,
      -- Martha L. Rogers, and
      -- J. Christopher C. Wansbrough.

All of the members of Microcell's previous Board have resigned.

Certain senior officers of Microcell, including Andre Tremblay,
previously President and Chief Executive Officer, and Jacques
Leduc, previously Chief Financial Officer and Treasurer, have also
resigned.

Nadir Mohamed has been appointed as the new President and Chief
Executive Officer of Microcell, and John Gossling has been
appointed as the new Senior Vice President and Chief Financial
Officer of Microcell. Mr. Mohamed and Mr. Gossling hold the same
positions at Rogers Wireless. Mr. Mohamed also announced the
appointment of Alain Rheaume to the position of Executive Vice-
President and President Fido.

                      About Rogers Wireless

Rogers Wireless operates Canada's largest integrated wireless
voice and data network, providing advanced voice and wireless data
solutions to customers from coast to coast on its GSM/GPRS/EDGE
network, the world standard for wireless communications
technology. The combination of Rogers Wireless and Microcell will
have 5.5 million wireless customers, and has offices in Canadian
cities across the country. Rogers Wireless is a wholly-owned
subsidiary of Rogers Wireless Communications Inc. (TSX: RCM -
News; NYSE: RCN - News), which is approximately 89% owned by
Rogers Communications Inc.

Rogers Communications Inc. (TSX: RCI; NYSE: RG) is a diversified
Canadian communications and media company. It is engaged in cable
television, high-speed Internet access and video retailing through
Canada's largest cable television provider, Rogers Cable Inc.; in
wireless voice and data communications services through Canada's
leading national GSM/GPRS cellular provider, Rogers Wireless
Communications Inc.; and in radio, television broadcasting,
televised shopping and publishing businesses through Rogers Media
Inc.

                          About Microcell

Microcell Telecommunications Inc. (TSX: MT.A; MT.B) 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 since October 15,
1997 and is listed on the Toronto Stock Exchange. Microcell has
been acquired by Rogers Wireless, which is approximately 89% owned
by Rogers Communications Inc.

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.


MORGAN STANLEY: Fitch Places B+ Rating on $21.2M Class G Certs.
---------------------------------------------------------------
Morgan Stanley Capital Inc.'s commercial mortgage pass-through
certificates, series 1996-WF1, are upgraded by Fitch Ratings as
follows:

   -- $9.1 million class E to 'AAA' from 'AA+';
   -- $21.2 million class F to 'A-' from 'BBB'.

In addition, Fitch affirms these classes:

   -- $59.4 million class A-3 at 'AAA';
   -- Interest only class X at 'AAA';
   -- $36.3 million class B at 'AAA';
   -- $30.3 million class C at 'AAA';
   -- $33.3 million class D at 'AAA';
   -- $21.2 million class G at 'B+'.

The $10.2 million class H certificates are not rated by Fitch. The
upgrades are a result of increased subordination levels due to
additional loan amortization and prepayments. As of the October
2004 distribution date, the pool's aggregate collateral balance
has been reduced by approximately 63%, to $221 million from $605.4
million at issuance. To date, the pool has realized losses in the
amount of $7.9 million.

There is currently one loan (4.6%) in special servicing. The loan
(4%) is secured by a retail property located in Auburn, Maine. The
loan is current and pending return to the master servicer.


MURRAY INC: Wants to Hire AlixPartners as Claims Agent
------------------------------------------------------
Murray, Inc., asks the U.S. Bankruptcy Court for the Middle
District of Tennessee for permission to employ AlixPartners, LLC,
as its claims, noticing and balloting agent during its chapter 11
proceeding.

The Debtor estimates more than 1,000 potential creditors and other
parties-in-interest will file proofs of claims.

AlixPartners is expected to:

   a) assist the Debtor with preparing for bankruptcy including   
      gathering of contracts, first day motions, lists of top
      creditors and segregation of pre vs. post petition
      liabilities;

   b) serve as notice agent, assist with developing the complete
      notice database system and provide proper notices to all
      potential creditors;

   c) assist with the preparation of the bankruptcy schedules
      and statements of financial affairs as necessary;

   d) assist with preparation of monthly operating reports as
      necessary;

   e) track and calculate allowable amounts for reclamation
      claims including specific details regarding product
      receipt timing and consumption as necessary;

   f) serve as claims agent to process all proofs of claim and
      file routine claims registers with the bankruptcy court;

   g) develop a claims database system including the details of
      the scheduled liabilities and proofs of claim designed to
      manage the claims resolution process;

   h) prepare an initial claims analysis and design and
      implement a process for resolving reconciling claims
      issues;

   i) provide both the Debtor and its counsel access to the
      claims database system;

   j) manage the overall claims resolution process as necessary;

   k) assist with the handling of all executory contracts and
      reject or assume leases accordingly as necessary;

   l) assist with the resolution of all contract cure costs and
      rejection claims as necessary;

   m) calculate all preference claims net of defenses and assist
      with collection as necessary;

   n) determine claim estimates by plan class and assist with
      the plan of reorganization;

   o) develop proper voting data and serve as voting agent;

   p) assist with distributions to creditors as necessary;

   q) appear in Court to provide testimony regarding tasks
      performed; and

   r) provide such other claims processing, noticing, balloting
      and related administrative services, as may be requested
      periodically by the Debtor.

AlixPartner's professionals will bill the Debtor at discounted
hourly rates:

            Designation                   Rate
            -----------                   ----
            Principals                    $400
            Senior Associates             $340
            Associates                    $295
            Accountants and Consultants   $235

To the best of the Debtor's knowledge, AlixPartners does not hold
or represent any interest materially adverse to the Debtor and its
estate.

Headquartered in Brentwood, Tennessee, Murray Inc. --
http://www.murray.com/-- manufactures lawn tractors, mowers,  
snowthrowers, chipper shredders, and karts.  The company employs
approximately 1,700 people through its manufacturing and
administrative facilities in the U.S., wholly-owned subsidiary
Murray Canada and sister company Hayter Limited in the United
Kingdom.  The Company filed for chapter 11 protection on Nov. 8,
2004 (Bankr. M.D. Tenn. Case No. 04-13611).  Paul G. Jennings,
Esq., at Bass, Berry & Sims PLC represents the Debtor in its
restructuring efforts.  When the Debtor filed for protection from
its creditors, it estimated more than $100 million in total debts
and assets.


NEIGHBORCARE INC: Inks Pact to Acquire Belville Pharmacy Services
-----------------------------------------------------------------
NeighborCare, Inc. (Nasdaq: NCRX) has signed a definitive
agreement to acquire Belville Pharmacy Services, Inc., of San
Diego, California. Belville is a long-term care pharmacy serving
skilled and residential facilities and hospices in Southern
California. The business being acquired currently generates
revenue of approximately $50 million on an annualized basis and
serves approximately 17,000 beds. Financial terms of the
transaction were not disclosed and final closing is expected to
take place within 30 days.

John J. Arlotta, NeighborCare's Chairman, President and Chief
Executive Officer said, "This acquisition continues our strategy
to acquire long term care pharmacies that enhance our geographic
presence and provide additional strategic value to our business.
We are pleased to now have a presence in the San Diego market to
complement our coverage throughout the state of California.
Belville Pharmacy has a unique operating model with an outstanding
service reputation throughout California. This acquisition is
another example of how we are executing on our previously
announced plans to grow our business both organically and through
strategic acquisitions."

Ron W. Belville, President of Belville Pharmacy said, "Through our
interaction with NeighborCare, it has become clear they have a
true passion for service excellence. Their strategy for long term
care and focus on the customer fits hand-in-hand with what the
employees of Belville have worked so hard over the years to
achieve. I am very happy to join the NeighborCare family and look
forward to serving our customers together for years to come."

                     About NeighborCare, Inc.

NeighborCare, Inc. (Nasdaq: NCRX) is one of the nation's leading
institutional pharmacy providers serving long term care and
skilled nursing facilities, specialty hospitals, assisted and
independent living communities, and other assorted group settings.
NeighborCare also provides infusion therapy services, home medical
equipment, respiratory therapy services, community-based retail
pharmacies and group purchasing. In total, NeighborCare's
operations span the nation, providing pharmaceutical services in
32 states and the District of Columbia.

                          *     *     *

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

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

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


NORTEL NETWORKS: Inks Settlement Agreement with Arbinet-thExchange
------------------------------------------------------------------
Nortel Networks (NYSE/TSX: NT) has entered into a settlement
agreement with Arbinet-thExchange, Inc., to resolve a lawsuit
originally brought by Nortel against Arbinet in July 2004. The
lawsuit claimed that Arbinet infringed copyrights and
misappropriated trade secrets by using, without authorization,
proprietary software of Nortel. Nortel also claimed that Arbinet
exceeded the permitted usage level under its Right to Use License
and failed to meet its contractual obligations to Nortel with
regard to the purchase of certain switching systems.

As part of the settlement, Arbinet will pay an undisclosed amount
to Nortel. Nortel has agreed to dismiss the lawsuit, which was
pending in the United States District Court, Eastern District of
Virginia, Alexandria Division.

                          About Nortel

Nortel is a recognized leader in delivering communications
capabilities that enhance the human experience, ignite and power
global commerce, and secure and protect the world's most critical
information. Serving both service provider and enterprise
customers, Nortel delivers innovative technology solutions
encompassing end-to-end broadband, Voice over IP, multimedia
services and applications, and wireless broadband designed to help
people solve the world's greatest challenges. Nortel does business
in more than 150 countries.

                          *     *     *

As reported in the Troubled Company Reporter on June 25, 2004,
Standard & Poor's Ratings Services said that its long-term
corporate credit rating and other long-term ratings on Nortel
Networks Corp. and Nortel Networks Ltd. remain on CreditWatch with
developing implications, where they were placed Apr. 28, 2004.

As previously reported, Standard & Poor's lowered its 'B' long-
term corporate credit rating and other long-term ratings on Nortel
Networks Corp. and Nortel Networks Ltd. to 'B-'.


NORTH AMERICAN: Case Summary & 20 Largest Unsecured Creditors
-------------------------------------------------------------
Debtor: North American Telephone Network, LLC
        4151 Ashford Dunwoody Road, Suite 675
        Atlanta, Georgia 30319

Bankruptcy Case No.: 04-78646

Type of Business: The Debtor provides telecommunication services.

Chapter 11 Petition Date: November 8, 2004

Court: Northern District of Georgia (Atlanta)

Judge: Joyce Bihary

Debtor's Counsel: Edward F. Danowitz, Jr., Esq.
                  Danowitz & Associates, P.C.
                  300 Galleria Parkway, North West, Suite 960
                  Atlanta, GA 30339
                  Tel: 770-933-0960

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

Estimated Debts:  $1 Million to $10 Million

Debtor's 20 Largest Unsecured Creditors:

Entity                        Nature Of Claim       Claim Amount
------                        ---------------       ------------
QWEST                                                 $5,479,035
P.O. Box 856184
Louisville, KY 40285

USAC-DCIA                                             $1,131,952
80 South Jefferson Road
Whippany, NJ 07981

Orso Partners Ltd.                                       $86,005
2300 N. Lincoln Blvd. Rm. 101
Oklahoma City, OK 73105

Transworld Telephone, LLC                                $60,000

Federal Communications                                   $55,000
Commission

Noble Systems, Corp.          Trade debt                 $52,514

Shughart Thomson & Kilroy                                $20,443

Suane International Corp.                                $13,880

Vertex, Inc.                                             $10,593

AccuData                                                  $8,506

Retail Decisions, Inc.                                    $7,000

American Arbitration                                      $6,725
Association

Arch Wireless                                             $6,524

PBCC                                                      $6,437

XO Communications             Trade debt                  $5,786

Purchase Power                                            $4,610

Luvaas Cobb                                               $4,482

Oregon, Department Of Justice                             $3,500

Del Printing, Inc.                                        $1,567

Clean Up Janitorial                                       $1,104


NUCENTRIX BROADBAND: Makes Initial Distribution to Stockholders
---------------------------------------------------------------
Nucentrix Broadband Networks, Inc., has funded an initial
distribution of $2.25 per share to holders of Nucentrix common
stock of record as of June 10, 2004. The distributions will be
made through the Company's disbursing agent, Computershare Trust
Company, Inc.

As previously reported, the U.S. Bankruptcy Court for the Northern
District of Texas confirmed the Company's First Amended Joint Plan
of Liquidation in May 2004 and, in June 2004, the Company
completed the sale of substantially all of its assets to Nextel
Spectrum Acquisition Corp. The effective date of the Plan is
June 10, 2004.

In accordance with the Plan, shares of common stock of Nucentrix
were canceled and the transfer books of the Company were closed at
3:00 p.m. (CDT) on June 10, 2004. Under the Plan, Record Holders
of Nucentrix common stock are entitled to receive distributions of
the remaining net proceeds from the sale of the Company's assets
after payment has been made to holders of allowed claims.

To claim their distributions, Record Holders are required to
surrender their stock certificates and otherwise follow the
instructions contained in the letter of transmittal mailed to
Record Holders yesterday. Beneficial owners whose shares of
Nucentrix common stock are held through a nominee holder such as
Cede & Co. or a depository institution such as a bank or brokerage
firm should direct any questions to such holder or institution.
Copies of the transmittal letter mailed to Record Holders may be
obtained (at the requesting party's expense) from, and questions
regarding the distribution to Record Holders may be directed to,
the Company's disbursing agent at:

            Computershare Trust Company, Inc.
            350 Indiana Street, Suite 850
            Golden, Colorado 80401
            303-262-0600

All distributions will be made pursuant to, and subject to the
conditions of, the Plan. Subject to the resolution of remaining
outstanding or disputed claims in the Company's Chapter 11
bankruptcy proceeding, the Company expects to make one or more
subsequent distributions to Record Holders before requesting the
entry of a final order closing the Company's bankruptcy case. The
Company is not able to estimate with certainty the date or amount
of such subsequent distributions, if any. The timing and amount of
any such additional distributions will be affected by:

     (i) the outcome and allowed amount of the remaining disputed
         claims, and

    (ii) the amount of expenses necessary to wind down the
         Company's estate, including professional fees and
         expenses.

A copy of the Plan, together with all pleadings and orders of the
Bankruptcy Court, are available for review:

     (i) during regular business hours (9:00 a.m. to 4:30 p.m.,
         weekdays, except for legal holidays) at the:

         Office of the Clerk
         U.S. Bankruptcy Court for the Northern District of Texas
         Dallas Division
         12A24 Earle Cabell Federal Building
         1100 Commerce Street
         Dallas, Texas 75242,

         under Case No. 03-39123, or

    (ii) at the Bankruptcy Court's website:

         http://txnb.uscourts.gov/  

         (registration and a password is required)

                        About the Company

Nucentrix Broadband Networks, Inc. provides broadband wireless
Internet services using radio spectrum licensed by the Federal
Communications Commission (FCC). This spectrum commonly is
referred to as MMDS (Multichannel Multipoint Distribution Service)
and ITFS (Instructional Television Fixed Service). Nucentrix is
the third largest holder of MMDS and ITFS spectrum in the U.S.
Nucentrix holds the rights to an average of approximately 128 MHz
of MMDS and ITFS spectrum, covering over 8 million households in
over 90 primarily medium and small markets across Texas, Oklahoma
and the Midwest. Nucentrix also holds licenses for 20 MHz of WCS
(Wireless Communications Services) spectrum at 2.3 GHz covering
over 2 million households, primarily in Texas.

Nucentrix Broadband Networks, Inc., and certain subsidiaries filed
chapter 11 petitions on Sept. 5, 2003 (Bankr. N.D. Tex. Case No.
03-39123).  The  U.S. Bankruptcy Court for the Northern District
of Texas has confirmed the First Amended Joint Plan of Liquidation
of the Company and its debtor subsidiaries in May 2004.


ORTEC INT'L: Grant Thornton Declines Reappointment as Auditor
-------------------------------------------------------------
On October 29, 2004, Ortec International, Inc., was advised by
Grant Thornton LLP, that it decided not to stand for reappointment
as the Company's independent auditors upon completion of their
review of its quarterly result for the three and nine-months ended
September 30, 2004.

Grant Thornton's report on the Company's financial statements for
the fiscal years ended December 31, 2003 and 2002, raised
substantial doubts about Ortec's ability to continue as a going
concern.

Ortec International, Inc. is a leading tissue-engineering and
advanced wound care company dedicated to the development and
commercialization of its proprietary technology, OrCel(R).  Ortec
believes that OrCel(R) is positioned to be the leading tissue
engineered product addressing chronic skin wounds such as venous
and diabetic ulcers, and acute wounds such as burns.


PEGASUS: Senior Lenders Want to Collect Interest & Prepayments
--------------------------------------------------------------
The Steering Committee of prepetition secured lenders under the:

    -- Fourth Amendment and Restatement of Credit Agreement dated
       as of October 22, 2003, by and among Pegasus Media &
       Communications, Inc., as borrower, Deutsche Bank Trust
       Company Americas, as Resigning Agent, Bank of America,
       N.A., as Administrative/Successor Agent and the lenders
       from time to time party thereto; and

    -- Revolving Credit Agreement dated as of December 19, 2003,
       by and among Pegasus Media & Communications, as borrower,
       Madeleine L.L.C., as administrative agent, and the lenders
       from time to time party thereto,

asks the Court to:

    (a) allow the payment of a 3% Prepayment Amount -- $9,495,000
        in the aggregate -- due on each of $298,500,000 of Tranche
        D Loans prepaid under the applicable provisions of the
        Term Loan Agreement and $18,000,000 of Revolving Loans
        prepaid under the applicable provisions of the Revolving
        Credit Agreement;

    (b) allow the payment of $2,420,067 due in respect of a 2%
        incremental default interest rate on the outstanding
        balance as of the Petition Date of $391,766,856 under the
        Term Loan Agreement and $18,000,000 under the Revolving
        Credit Agreement, for the period commencing on June 1,
        2004, through September 17, 2004;

    (c) award interest on the Default Interest and Prepayment
        Amounts; and

    (d) direct Pegasus Satellite Communications and its debtor-
        affiliates to pay the Default Interest and Prepayment
        Amounts together with interest.

It is undisputed that the Senior Secured Term Lenders and the
Senior Secured Revolving Lenders are oversecured, Benjamin E.
Marcus, Esq., at Drummond Woodsum & Macmahon, in Portland, Maine,
says.  Pursuant to Section 506(b) of the Bankruptcy Code, an
oversecured creditor is entitled to both interest on its secured
claim and any reasonable fees, costs or charges provided for under
the agreement under which the claim arose.  While the Senior
Lenders have received principal and non-default interest due to
them, they have not been paid either:

    (a) the contractual default interest due on their secured
        claims; or

    (b) the reasonable fees, costs or charges due under the Term
        Loan Documents and Revolving Credit Agreement Documents.

Both default interest and the prepayment amounts are due under the
terms of the Loan Documents.  It is a basic tenet of contract law
that a party is entitled to that for which it bargained,
especially where the loan documents were heavily negotiated
between sophisticated parties.  However, there are exceptions to
the general rule that lenders are automatically entitled to what
is provided for in their loan documents -- a prepayment amount
must be "reasonable" under Section 506(b) and payment of default
interest must not lead to an "inequitable or unconscionable
result."

          Senior Lenders Should be Paid Default Interest

In the case of default interest, the burden is on the debtor to
prove that the payment of default interest is inequitable or
unconscionable.  Courts start with the rebuttable presumption that
the contract rate will be allowed.  While the case law is wide-
ranging on this issue, it appears that the presumption will be
rebutted without any justification for the spread or where the
default rate appears inordinately high in relation to the non-
default rate.  At that point, the default rate is viewed as a
penalty, which is inherently inequitable or unconscionable.

Mr. Marcus asserts that the Senior Lenders are entitled to the
Default Interest.  The Loan Documents provide for the Default
Interest and paying it would not yield an inequitable or
unconscionable result because:

      (i) The 2% spread between the default and non-default rate
          of interest under the Loan Documents is customary;

     (ii) The 2% default interest spread under the Loan Documents
          is within the range routinely allowed by Courts;

    (iii) The Senior Lenders were at great risk of not being paid
          during the Debtors' Chapter 11 cases;

     (iv) The 9% to 12.5% interest rate is likely less than what
          Pegasus Media & Communications could have obtained post-
          default from a third party lender;

      (v) The Loan Documents were executed by sophisticated
          parties;

     (vi) The Senior Lenders did not delay or obstruct the
          bankruptcy proceedings; and

    (vii) Pegasus Media and Communications is solvent and in any
          event paying default interest will have no or at most a
          minimal impact on unsecured creditors.

        Senior Lenders are Entitled to Prepayment Amounts

According to Mr. Marcus, the prepayment amount is reasonable
within the meaning of Section 506(b).  A 3% prepayment amount is
well within customary confines, and is in all likelihood at the
low-end of the range.  The Loan Documents were heavily negotiated
between sophisticated parties.  This is a far cry from the many
reported decisions involving double digit prepayment amounts
imposed by mortgagees on unsophisticated borrowers.  Furthermore,
the Loan Documents are governed by New York law -- which routinely
upholds liquidated damages provisions.

The Senior Lenders have been damaged in that it is unlikely that
they will be able to re-lend the amounts received at comparable
rates, or anywhere close to them.  The Senior Lenders estimate
that they may incur damages of over $16,000,000 as a result of the
prepayment.

The courts -- in those rare circumstances where liquidated damages
have been denied -- will nevertheless allow the actual damages of
a secured lender, Mr. Marcus says.  The prepayment provisions pass
muster under either a state and federal law "actual damage" test
because the Senior Lenders have been damaged by the Prepayment
made.

Interest rates on senior secured loans are usually comprised of
two components.  There is the Base Rate or LIBOR Rate and then the
spread above that rate.  The Secured Loans were LIBOR plus 7.0%
Loans or Base Rate plus 6.0% Loans.  The Senior Lenders would not
be able to re-lend the prepaid funds today at a LIBOR + 7.0% rate
to a company with a similar risk profile to the Debtors at the
time the Loans were originally made in 2003, because:

    -- the Secured Loans were uniquely priced when originally
       made, that is, due to unique issues involving the Debtors,
       the Loans included at a somewhat larger spread than would
       typically have been the case for a company with a similar
       credit profile to the Debtors; and

    -- while the LIBOR Rate has risen slightly since October 2003,
       the spreads above LIBOR for companies with similar credit
       profiles and ratings to the Debtors have narrowed
       substantially since the Loans were made.

Consequently, due to the changes in interest rate spreads, a
company with a similar credit profile and rating today would
command a substantially lower overall interest rate.  Today, a
similarly rated senior secured loan made directly to a company's
operating entities would likely be in the LIBOR plus 1.25% to
4.25% range.  This results in an annual interest loss of as much
as $18,200,000 to the Senior Lenders.  The Senior Lenders believe
that if an actual damages test were utilized, they would be
entitled to substantially more than the Prepayment Amount.

             Senior Lenders are Entitled to Interest
                  on Payment of Disputed Amounts

The Senior Lenders are also entitled to interest on any Additional
Amounts pursuant to the Loan Documents, the Cash Collateral Order
and applicable law since the Debtors have not paid the Additional
Amounts when due under the Loan Documents.

Section 506(b) provides for the allowance of interest on an
oversecured creditor's claim, and any reasonable fees, costs, or
charges provided for under the agreement under which the claim
arose.  There is no reason that interest on overdue interest and
fees should be treated differently than other amounts due under
the Loan Documents.

                         Committee Responds

The Senior Lenders, who, just three months after the Petition
Date, received full payment of their principal and interest from
the proceeds of the DIRECTV sale, now requests payment of
additional amounts.

Jacob A. Manheimer, Esq., at Pierce Atwood, in Portland, Maine,
asserts that the now fully compensated secured creditors should
not be further enriched by the payment of Default Interest.
According to Mr. Manheimer, paying the Default Interest is not
warranted because:

    (a) the Senior Lenders faced no risk of non-payment since
        they were assured of being paid as a result of the DIRECTV
        Offer to purchase the DBS business;

    (b) the Senior Lenders' contract or base interest rate
        provided them with an appropriate market rate of return;

    (c) paying the Default Interest would negatively impact the
        unsecured creditors' recovery in the Debtors' cases; and

    (d) the Senior Lenders bore no increased monitoring costs
        after the event of default.

Mr. Manheimer adds that paying the Prepayment Penalties is
unjustified.  Prepayment premiums are designed to ensure that a
lender will receive the benefit of its bargain in the form of
interest payments, at the contract rate, over the life of the
loan.  Prepayment premiums are not designed to penalize borrowers
and deter prepayments.  The Prepayment Penalties are not
appropriate because:

    (a) The Prepayment was involuntary because the Senior Lenders
        effectively forced the Sale of the Debtors' satellite
        assets;

    (b) The Prepayment was involuntary because the Debtors are
        liquidating all of their assets;

    (c) The Senior Lenders' Prepayment Penalty formulas are
        fundamentally flawed;

    (d) The Senior Lenders could have loaned the amounts
        collected by the Prepayment to other borrowers.

Mr. Manheimer notes that the Official Committee of Unsecured
Creditors' hard work in achieving the Global Settlement for the
benefit of the Debtors' creditors, including the Senior Lenders,
should not be penalized by the imposition of inappropriate
Default Interest and Prepayment Penalties.  While the Senior
Lenders were paid in full only three months after the Petition
Date, the unsecured creditors have received no recovery at this
point and will never be paid in full.

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)


POLYONE CORP: S&P Revises Outlook on B+ Rating to Stable
--------------------------------------------------------
Standard & Poor's Ratings Services revised its outlook on PolyOne
Corp. to stable from negative.

At the same time, Standard & Poor's affirmed its 'B+' corporate
credit rating and other ratings on the company.

Cleveland, Ohio-based PolyOne, with $2.1 billion of annual sales
and about $750 million of debt (adjusted to include capitalized
operating leases and an accounts receivable securitization
program), is a global polymer services company.

"The outlook revision recognizes the improvement to PolyOne's
financial profile as a result of better operating performance and
debt reduction stemming from asset sales, and the expectation that
good near-term results will further strengthen credit protection
measures," said Standard & Poor's credit analyst Peter Kelly.

Earnings have benefited from a pickup in demand in operating
businesses, better cost control, and higher equity earnings from
joint ventures. Debt reduction was aided by the August sale of the
elastomers and performance additives business, one of three
operating units identified for possible divestiture (the remaining
two are specialty resins and engineered films).  The rating action
also incorporates Standard & Poor's expectation that management
will maintain a disciplined approach to capital expenditures,
acquisitions, common stock repurchases, dividends, and other
discretionary expenditures.

Standard & Poor's said that its ratings on PolyOne reflect subpar
credit protection measures resulting from a combination of still
weak profitability and high debt leverage, somewhat offset by the
company's fair business profile in performance polymers and
services. PolyOne, formed through the merger of Geon Co. with M.A.
Hanna Co., has revenues of about $2.1 billion. The company holds
good market positions in vinyl plastic and rubber compounding,
color and additive concentrates, and plastic resin distribution.
PolyOne also holds a 24% interest in the Oxy Vinyls L.P. joint
venture with Occidental Petroleum Corp., and a 50% interest in the
Sunbelt chlor-alkali joint venture with Olin Corp. Oxy Vinyls is a
large North American producer of polyvinyl chloride and vinyl
chloride monomer.


SECOND CHANCE: Look for Bankruptcy Schedules on Nov. 15
-------------------------------------------------------
The U.S. Bankruptcy Court for the Western District of Michigan
gave Second Chance Body Armor, 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 Nov. 15, 2004, to file those documents.

The Debtor tells the Court that because of the volume and
complexity of its business affairs, it is still preparing and
completing its Schedules.  The Debtor points-out that its mailing
matrix lists 900 entities.  

The Debtor tells the Court that the extension will give it more
time to work with its counsel to diligently work on completing the
Schedules before the November 15 deadline.

Based in Central Lake, Michigan, Second Chance Body Armor, Inc. --  
http://www.secondchance.com/-- manufactures wearable and soft  
concealable body armor. The Company filed for chapter 11  
protection on Oct. 17, 2004 (Bankr. W.D. Mich. Case No. 04-12515).  
Stephen B. Grow, Esq., at Warner Norcross & Judd, LLP, represents  
the Company in its restructuring. The Company estimates assets  
and liabilities of $10 million to $50 million.


SECOND CHANCE: Wants to Hire Warner Norcross as Bankruptcy Counsel
------------------------------------------------------------------        
Second Chance Body Armor, Inc., asks the U.S. Bankruptcy Court for
the Western District of Michigan for permission to employ Warner
Norcross & Judd LLP as its general bankruptcy counsel.

Warner Norcross is expected to:

   a) analyze the Debtor's financial situation and render general
      legal advice and assistance to the Debtor, including legal
      matters incident to the bankruptcy filing;

   b) Prepare and file the petition, schedules, statement of
      affairs, and other documents required by the Court;

   c) represent the Debtor at the meeting of creditors;

   d) advise the Debtor with respect to a plan of reorganization
      and prosecution of claims against third parties, if any, and
      any other matters relevant to the bankruptcy proceedings and
      the formulation of a plan of reorganization; and

   e) represent the Debtor in all other legal matters during the
      course of its bankruptcy proceedings.

Stephen B. Grow, Esq., a Partner at Warner Norcross, is the lead
attorney for Second Chance's restructuring. Mr. Grow discloses
that the Firm received a $270,000 pre-petition retainer. For his
professional services, Mr. Grow will bill the Debtor $275 per
hour.

Mr. Grow reports Warner Norcross' professionals bill:

    Professional               Designation      Hourly Rate
    ------------               -----------      -----------
    Robert H. Skilton          Counsel             $325
    Kathleen M. Hanenberg      Counsel              290
    Gordon J. Toering          Counsel              260
    Bonnie B. Schaub           Paralegal            105

Warner Norcross does not represent any interest adverse to the
Debtor or its estate.

Based in Central Lake, Michigan, Second Chance Body Armor, Inc. --  
http://www.secondchance.com/-- manufactures wearable and soft  
concealable body armor. The Company filed for chapter 11  
protection on Oct. 17, 2004 (Bankr. W.D. Mich. Case No. 04-12515).  
Stephen B. Grow, Esq., at Warner Norcross & Judd, LLP, represents  
the Company in its restructuring. The company estimates assets  
and liabilities of $10 million to $50 million.


SOLUTIA INC: Has Until February 15 to Make Lease-Related Decisions
------------------------------------------------------------------
The U.S. Bankruptcy Court for the Southern District of New York
extended the period within which Solutia, Inc., and its debtor-
affiliates can elect to assume, assume and assign or reject non-
residential real estate leases and executory contracts until
February 15, 2004.

As reported in the Troubled Company Reporter on Oct. 11, 2004, the
Debtors assured the Court that the lessors under the Unexpired
Leases will not be prejudiced by the extension because:

   (a) the Debtors have performed and will continue to perform in
       a timely manner their undisputed postpetition date
       obligations under Unexpired Leases;

   (b) no lessor will be damaged by the requested extension in a
       way that is not compensable under the Bankruptcy Code; and

   (c) any lessor may ask the Court to fix an earlier date by
       which the Debtors must assume or reject its lease in
       accordance with Section 365(d)(4) of the Bankruptcy Code.

Headquartered in St. Louis, Missouri, Solutia, Inc. --
http://www.solutia.com/-- with its subsidiaries, make and sell a  
variety of high-performance chemical-based materials used in a
broad range of consumer and industrial applications.  The Company
filed for chapter 11 protection on December 17, 2003 (Bankr.
S.D.N.Y. Case No. 03-17949).  When the Debtors filed for
protection from their creditors, they listed $2,854,000,000 in
assets and $3,223,000,000 in debts.  (Solutia Bankruptcy News,
Issue No. 25; Bankruptcy Creditors' Service, Inc., 215/945-7000)


SOLUTIA INC: S&P Withdraws Default Ratings Due to Lack of Info
--------------------------------------------------------------
Standard & Poor's Ratings Services withdrew its 'D' ratings on
Solutia Inc. and Solutia Europe S.A./N.V.

Solutia Inc. filed for Chapter 11 protection in December 2003, at
which time Standard & Poor's lowered the corporate credit and
other ratings of Solutia Inc. to 'D' from 'CCC'.  Ratings on
Solutia Europe, which has not filed for bankruptcy protection,
were withdrawn because of the lack of information required to
support surveillance.


SOTHEBY'S HOLDINGS: Posts $28.7 Million Third Quarter Net Loss
--------------------------------------------------------------
Sotheby's Holdings, Inc. (NYSE: BID), the parent company of
Sotheby's worldwide auction businesses, art-related financing and
private sales activities, reported results for the third quarter
and nine months ended September 30, 2004.

For the quarter ended September 30, 2004, the Company's aggregate
hammer price of property sold at auction, including buyer's
premium, was $194.3 million, a 66% increase from $116.8 million in
the prior period, largely due to broad-based strong auction sales
results, most especially the July Old Master Paintings sales in
London.

The Company reported auction and related revenues of $42.9 million
for the third quarter of 2004, compared to $29.0 million in the
corresponding period in 2003, an increase of 48%, principally due
to higher commission revenues from the improved summer sales
results. For the third quarter of 2004, the Company's consolidated
net loss was ($28.7) million. The Company's net loss from
continuing operations for the third quarter of 2004 was ($28.3)
million, compared to a net loss from continuing operations of
($29.5) million in the prior period, an improvement of $1.2
million. During the third quarter of 2004, the Company recorded
pre-tax antitrust related special charges of $0.4 million. During
the third quarter of 2003, the Company recorded pre-tax charges of
$2.7 million, primarily due to employee retention costs and
antitrust related special charges. Excluding these items, the
Company would have recorded an adjusted net loss from continuing
operations of ($28.0)* million, or ($0.45)* per diluted share and
($27.7)* million, or ($0.45)* per diluted share, in the third
quarters of 2004 and 2003, respectively.

The third quarter is historically a period of minimal sales
activity in the art auction market (typically less than 10% of
total annual auction sales for Sotheby's) and, therefore, the
Company traditionally reports a loss in the period.

For the first nine months of 2004, Auction Sales were $1,547.6
million, an increase of 72% from $897.8 million in the prior
period, due to the strength of the art market experienced in
Sotheby's salesrooms around the world. For the first nine months
of 2004, net income was $50.5 million, or $0.81 per diluted share.
Net income from continuing operations for the first nine months of
2004 was $26.2 million, or $0.42 per diluted share, compared to a
net loss in the prior period of ($43.4) million, or ($0.70) per
diluted share, an improvement of $69.6 million. This upturn was
primarily due to a significant increase in auction commissions as
well as the recognition of $45.0 million in license fee revenue
related to a one-time non-refundable payment received for entering
into a license agreement with Cendant Corporation in conjunction
with the Company's sale of its domestic real estate brokerage
business in February.

The Company recorded pre-tax charges of $2.1 million in the first
nine months of 2004, largely attributable to antitrust related
special charges which are run-off legal and administrative costs.
In the first nine months of 2003, pre-tax charges were $15.8
million, primarily due to the Company's employee retention
programs and net restructuring charges. Excluding these items and
the Cendant license fee revenue and expense, the Company would
have recorded an adjusted loss from continuing operations of
($0.7)* million, or ($0.01)* per diluted share, in the first nine
months of 2004, as compared to an adjusted loss from continuing
operations of ($33.2)* million, or ($0.54)* per diluted share, in
the prior period, an improvement of $32.5 million.

"These are extremely strong results, which are continuing into the
fourth quarter in many collecting categories, including
Impressionist and Modern Art. They demonstrate that the art market
is still experiencing the upward trend that began around this time
last year," said Bill Ruprecht, President and Chief Executive
Officer of Sotheby's Holdings, Inc.

Sotheby's currently expects the recovery in the international art
market to continue and the Company is encouraged by the level of
consignments for the remainder of the fall auction season, which
include a number of outstanding single owner sales. However, it is
unlikely that Auction segment results for the first half of 2005
will be at the level achieved in the first half of 2004, which
included the landmark private sale of the Forbes Collection of
Faberge and the sale of the world's most expensive painting, Pablo
Picasso's Garcon a la Pipe, which sold for $104.2 million.

                  Third and Fourth Quarter Sales

The highlight of the third quarter was the exceptional Old Master
Paintings sales in London which brought $55.1 million,
significantly above its pre-sale high estimate of $38.1 million**
and 51% above the prior year result of $36.6 million**. A major
contribution to the success of that auction was Johannes Vermeer's
Young Woman Seated at the Virginals, the first Vermeer to come to
auction since 1921. The painting sold for $30 million, a price
well in excess of its pre-sale estimate of $5.4 million**.

Last week in New York, Sotheby's held its fall series of
Impressionist and Modern Art sales. The sales led the market with
a total of $232.0 million, with the evening sale bringing the
highest various owner sales total for Sotheby's in fourteen years.
Three lots sold for over $20 million, with one of them, a
masterpiece by Gauguin, bringing almost $40 million. Twenty eight
lots were sold above $1 million and six auction records were
broken for works by Paul Gauguin, Amedeo Modigliani, Piet
Mondrian, Henry Moore, Chaim Soutine and Barbara Hepworth.

In Hong Kong, Sotheby's fall sales brought $75.8 million, well
above last year's total of $44.9 million and the best results in
Sotheby's 30-year history in Hong Kong. A highlight of the
Magnificent Jewels auction was the sale of an 88.88 carat emerald-
cut white diamond for $6.1 million, above its low estimate of $5.4
million**, a record for western jewelry sold in Asia. Another
record was set during the Chinese Ceramics sale for a vase from
the period of Emperor Qianlong which sold for $5.3 million, above
its estimate of $3.9/$5.1 million**, a world auction record for
Qing Dynasty porcelain.

Single owner sales have also performed extremely well thus far
this quarter. Several auctions took place in October in New York:
The Americana Collection of Mr. and Mrs. Walter M. Jeffords, which
spanned many eras of American history from pre-Revolutionary
silver to 18th and 19th Century, brought $18.2 million against an
estimate of $16/$24 million**.

The fourth and final sale of masterpieces from the Time Museum
achieved $18.2 million, about double its pre-sale estimate of
$8/$10 million** for the sale of 1,250 of the finest time-finding
and time-keeping devices in the world, bringing the total from the
four Time Museum sales to $58.6 million.

The Collection of Mrs. Marella Agnelli, widow of Giovanni Agnelli,
Chairman of Fiat, included important French and Russian Furniture,
Works of Art and Porcelain. It totaled $14.2 million, well above
its pre-sale estimate of $7/$11 million**.

In London, the contents of the Pharmacy restaurant in Notting Hill
brought outstanding results. All 140 lots of Contemporary
paintings, wall-mounted medicine cabinets and Contemporary
furniture and tableware by artist Damien Hirst were sold, totaling
$20.0 million, well above the pre-sale estimate of $5.4 million**.

                         Upcoming Sales

On December 1st in New York, Sotheby's will hold its various owner
American paintings sale which will include property from the Cigna
Museum and Art Collection as well as American paintings from the
Collection of Pierre Berge from his pied-a-terre at the Pierre
Hotel in New York. The total sale is estimated to achieve
$55.7/$82.2 million**.

Included in the various owner American Paintings sale is property
from the exceptional American art collection of Mr. and Mrs.
Daniel Fraad. These 79 lots are estimated between $31.8 million
and $47.8 million** and this is the most valuable collection of
American art ever brought to auction. It includes works by John
Singer Sargent, George Bellows, Maurice Prendergast, Everett Shinn
and Winslow Homer. The highlight of the collection is John Singer
Sargent's Group with Parasols (a Siesta) (estimated at $9/$12
million**), a breathtaking work that was inspired by his travels
in the Alpine region in the early 1900s.

In Geneva on November 17th, Sotheby's is holding its Magnificent
Jewels sale, which includes property from the collection of Maria
Callas. The 377 lots have a pre-sale estimate of $24.5/$30.1
million** and include jewels designed by the world's leading
jewelry houses such as Harry Winston, Bulgari, Boucheron, Cartier
and Van Cleef & Arpels.

In London, the current strength of the Russian market is set to be
further demonstrated in a series of sales of Russian works of art.
The Russian sale on December 1st is estimated to realize between
$15.2 - $21.1 million** and includes the largest range of Russian
works of art ever offered in a single sale at Sotheby's. Two days
later in London, Sotheby's will hold an historic sale of wines
from the Russian Imperial Cellars. Sales of wines from the cellars
of the Tsars are an extremely rare event and this sale is expected
to achieve $835,000 to $1.3 million**.

On December 8th and 9th in London, Sotheby's will hold its winter
sale of Old Master Paintings which includes what is widely
considered to be the finest work by Pieter Brueghel the Younger
still in private hands. The work, Kermesse of St. George, is
estimated at $4.6/$6.5 million**, with the total sales expected to
bring $22.3/33.4 million**.

On December 2nd in New York, Sotheby's will offer the O'Fallon
Collection of American Indian Portraits by George Caitlin,
arguably the most significant pictorial historian of the American
West. The sale of 28 portraits of North American Indians and three
paintings of buffalo is being consigned by the Field Museum of
Natural History and is estimated to bring $9/$15 million**.

Also on December 2nd in New York, Sotheby's and SportsCards Plus
will hold the auction of Important Baseball Memorabilia. The
undisputed highlight of the sale is Babe Ruth's baseball bat that
he used to score the first home run in the new Yankee Stadium in
April 1923. The bat is expected to bring in excess of $1
million**.

     *  Non-GAAP financial measure.  
     ** Estimates do not include buyer's premium.

                        About the Company

Sotheby's Holdings, Inc. is the parent company of Sotheby's
worldwide auction businesses, art-related financing and private
sales activities. The Company operates in 34 countries, with
principal salesrooms located in New York and London. The Company
also regularly conducts auctions in 13 other salesrooms around the
world, including Australia, Hong Kong, France, Italy, the
Netherlands, Switzerland and Singapore. Sotheby's Holdings, Inc.
is listed on the New York Stock Exchange under the symbol BID.

                          *     *     *

As reported in the Troubled Company Reporter on Sept. 28, 2004,
Standard & Poor's Ratings Services placed the ratings on Sotheby's
Holdings, Inc., including its 'B+' long-term corporate credit
rating, on CreditWatch with positive implications. Sotheby's had
$272 million of debt outstanding at June 30, 2004.

This action reflects Sotheby's improved credit measures following
a recovery in the art market. Total revenues for the first two
quarters grew 66% year-over-year to $276 million, primarily
reflecting higher auction commission revenues and the sale of
Sotheby's International Realty, Inc., to Cendant. At June 30,
2004, total lease adjusted debt to EBITDA was 2.5x and trailing
12-month EBITDA interest coverage was 3.2x. This compares to more
than 8x debt to EBITDA leverage at the end of 2003. Financial
flexibility has also improved with $147 million of cash at
June 30, 2004, and a $200 million three-year revolving credit
facility that was finalized in the first quarter of 2004.

"We expect to resolve the CreditWatch listing in the next few
weeks. Ratings could be raised one or two notches," said Standard
& Poor's credit analyst Stella Kapur. Factors that will be
considered include stability of the art market and Sotheby's
strategy and financial policy.


SOTHEBY'S HOLDINGS: S&P Upgrades Corporate Credit Rating to BB-
---------------------------------------------------------------
Standard & Poor's Ratings Services raised its ratings on Sotheby's
Holdings Inc. The corporate credit rating was raised to 'BB-' from
'B+'. All ratings were removed from CreditWatch, where they were
placed with positive implications September 24, 2004. The outlook
is positive.

"The higher rating reflects the company's improved credit measures
following a recovery in the art market," said Standard & Poor's
credit analyst Stella Kapur. Total revenues for the first three
quarters grew 53% year over year to $321 million, primarily
reflecting higher auction commission revenues and the sale of
Sotheby's International Realty Inc. to Cendant Inc. At
September 30, 2004, total lease-adjusted debt to EBITDA was 2.5x
and trailing-12-month EBITDA interest coverage was 3.3x. This
compares to more than 8.0x debt to EBITDA leverage at the end of
2003.

While credit measures are very strong for current rating levels,
they reflect a material one-time benefit to revenues from the sale
of Sotheby's International Realty to Cendant during the first
quarter of 2004. Hence, credit measures are anticipated to
decrease to levels more consistent with current rating levels
after the first quarter of 2005. Financial flexibility has also
improved this year due to a $200 million three-year revolving
credit facility, which was finalized in the first quarter of 2004,
and $56 million of cash as of Sept. 30, 2004.

While Sotheby's and privately owned Christie's PLC are the two
largest auctioneers of fine art, antiques, and collectibles, they
are subject to global volatility in the demand for art. In
addition, auction revenue is highly seasonal, with around 80% of
total annual revenues generated in the second and fourth quarters.
However, Standard & Poor's believes that the company's commission
structure, the quality of its current assets, its carefully guided
loan-making practices, and the relatively small amount of working
capital needed to finance the business lends additional support to
the rating.


SOUTH SALEM CARE CENTER: Voluntary Chapter 11 Case Summary
----------------------------------------------------------
Debtor: South Salem Care Center, LLC.
        c/o Gabi Keil
        57 Soledad Drive #109
        Monterey, California 93940

Bankruptcy Case No.: 04-68720

Type of Business:  The Company operates a nursing home.

Chapter 11 Petition Date: November 5, 2004

Court: District of Oregon (Eugene)

Judge: Frank R Alley III

Debtor's Counsel: Stephen Behrends, Esq.
                  Behrends, Swingdoff, Haines & Critchlow PC
                  PO Box 10552
                  Eugene, Oregon 97440
                  Tel: (541) 344-7472

Total Assets: $3,498,616

Total Debts:  $1,342,023

The Debtor has no unsecured creditors who are not insiders.


STANDARD COMMERCIAL: S&P Puts BB+ Ratings on CreditWatch Negative
-----------------------------------------------------------------
Standard & Poor's Ratings Services placed its 'BB+' corporate
credit and other ratings on the third largest independent leaf
tobacco dealer Standard Commercial Corp. and related entities on
CreditWatch with negative implications.

At the same time, the 'BB' corporate credit rating and other
ratings on the second largest independent tobacco dealer DIMON
Inc. remain on CreditWatch with negative implications where they
were placed on May 25, 2004, for performance below Standard &
Poor's expectations.

At June 30, 2004, there was about $473 million of debt outstanding
at Wilson, North Carolina-based Standard Commercial and about $813
million of debt outstanding at Danville, Virginia-based DIMON.

The rating action follows DIMON and Standard Commercial's
announcement that the two companies have signed a definite merger
agreement. Under the terms of the agreement, each Standard
Commercial common stockholder will receive three DIMON shares for
each share of Standard Commercial. This is a 13.8% premium to
Standard Commercial's November 5, 2004, closing stock price and
implies a transaction value of about $670 million for Standard
Commercial. Post merger, DIMON and Standard Commercial's
shareholders will own approximately 52% and 48%, respectively, of
the merged entity, DimonStandard Inc.

The transaction is subject to customary closing conditions,
including the approval of both companies' shareholders and the
approval by foreign and U.S. antitrust authorities. The
transaction is not expected to close until sometime in the first
half of calendar 2005.

"Although the transaction should provide the new merged entity
with opportunities for significant cost savings and operating
efficiencies, the company will be highly leveraged. Our analysis
will focus on the strengths and weaknesses of the combined firm,
management's operating strategies, and financial policies for the
new company. We will meet with the management team before reaching
a rating conclusion, and expects that its review will be completed
within three months," said Standard & Poor's credit analyst Jayne
Ross.


STAR CAR WASH: Case Summary & 14 Largest Unsecured Creditors
------------------------------------------------------------
Debtor: Star Car Wash of Queens, Inc.
        97-31 Sutphin Boulevard
        Jamaica, New York 11345

Bankruptcy Case No.: 04-25754

Type of Business:  The Company operates a car wash from its leased
                   premises located at 97-31 Sutphin Boulevard in
                   Jamaica, New York.

Chapter 11 Petition Date: November 8, 2004

Court: Eastern District of New York (Brooklyn)

Judge: Jerome Feller

Debtor's Counsel: Douglas J Pick, Esq.
                  Pick & Saffer LLP
                  350 Fifth Avenue, Suite 3000
                  New York, New York 10118
                  Tel: (212) 695-6000
                  Fax: (212) 695-6007

Total Assets:   $459,110

Total Debts: $11,198,001

Debtor's 14 Largest Unsecured Creditors:

    Entity                                Claim Amount
    ------                                ------------
Billie Moye                                $10,000,000
c/o Scott Wolinetz, PC
11 Park Place, 10th Floor
New York, New York 10007

Peng Huang                                    $150,000
87-15 Barrington Street
Jamaica Estates, New York 11432

Pong-Gee Lee                                   $20,000
6 Fairway Court
Upper Brookville, New York 11771

New York City Department of Environmental      $20,000
Protection

Geico Direct                                   $18,831

Evanston Insurance Company                     $11,250

Wand, Powers & Lipner, LLP                      $5,000

Lipner, Sofferman & Company, LLP CPA            $4,000

Tremont Law Group, LLP                          $3,000

Rochdale Insurance Company                      $2,000

Consolidated Edison Cooper Station              $1,221

Jobe Industries, Inc.                             $826

AT&T                                              $300

KeySpan                                            $73


STAR GAS: Moody's Confirms Junk Ratings with Developing Outlook
---------------------------------------------------------------
Moody's Investors Service confirmed Star Gas Partners, L.P.'s
senior implied rating at Caa1 and the senior unsecured note rating
at Caa3 and changed the outlook to developing. This action
concludes the review initiated on October 18, 2004 following the
company's announcement that its heating oil subsidiary, Petro
Holdings Inc would fail to meet certain requirements under its
credit facility and would not be able to access its working
capital facility.

The confirmation of Star Gas' ratings reflects the company's
announcement of a new financing plan and Moody's expectation that
the temporary waiver will have at least a near-term stabilizing
effect on the company's capital structure. Details of the proposed
recapitalization will likely follow with a rating of the new
proposed notes.

Though the ratings are no longer on review for further downgrade
the developing outlook is based on a pending analysis of the
company's recapitalization, which will include a rating on the new
notes. The developing outlook entails further analysis including a
review of:

   (1) the results of Star Gas Partners, L.P.'s fiscal year-end
       audit;

   (2) the usage of the excess free cash flow following the
       elimination of the equity distributions;

   (3) the underlying fundamentals of the propane and heating oil
       businesses; and

   (4) the proposed financings impact on the existing 10.25% notes
       at the MLP level as well as the senior implied rating.

The proposed committed $600 million financing consists of a
$300 million 5 year Asset Backed Working Capital Lending facility
and a $300 million bridge facility that will act as a conduit to
the proposed issuance of $300 million of senior secured notes due
2015.  The proceeds of the credit facility and the public notes
offering will be used to refinance the existing working capital
facilities (including the Credit Agreement with Wachovia Bank) and
to refinance all of the outstanding institutional indebtedness
held at Petro and Star Propane, including the make-whole premium
on the private placement notes. The asset-based facility will be
secured by substantially all of the assets of Petro and Star
Propane and will be guaranteed by all of Star Propane's domestic
subsidiaries and Star Gas, LLC. The proposed notes will have a
second security interest on all assets and a first lien on the
stock of its domestic subsidiaries. They will carry the same
guarantee as the credit facility. The notes will rank pari passu
with all present and future senior secured indebtedness except the
ABL facility.

Although Moody's does not rate the debt at Petro or at Star Gas
Propane, we do rate the senior unsecured notes at the MLP (Star
Gas Partners L.P.) level, which is entirely dependent upon cash
flows from both Petro subsidiary and Star Gas Propane.
Approximately 60% of the MLP's earnings and cash flows are
generated from Petro and the MLP guarantees Petro's debt (though
the MLP does not guarantee the note of Star Gas Propane) thus
giving the Petro lenders a claim on the MLP. Pending the new
financing, Moody's believes that the probability that the MLP
notes will default will decrease. However, the notes will lie in a
significantly junior position relative to the rest of the
company's debt load.

Moody's ratings for Star Gas Partners L.P. are:

   * Confirmed at Caa3-Star Gas' 10.25% senior unsecured notes due
     2013

   * Confirmed at Caa1-Star Gas' senior implied rating

Star Gas Partners, L.P. is a diversified home energy distributor
and services provider specializing in heating oil and propane and
is located in Greenwich, Connecticut.


TANGO INC: Board Approves Plan to Buy $3 Mil. Warehouse in Oregon
-----------------------------------------------------------------
Tango Incorporated's (OTCBB:TNGO) Board of Directors have approved
management's request to provide notice to the Company's current
landlord in Portland to exercise the Tango Pacific's option to
purchase its facility in Gresham, Oregon. The estimated purchase
price is approximately $3,0000,000 USD.

"We feel that this is a key move for the Company financially,
because we expect to save approximately $350,000 over the course
of the current lease. We want to modernize the current facility to
add additional racking and use the new computer system to automate
our inventory tracking to be more precise. In addition the
acquisition of real estate for Tango is a good move for where we
want to take the Company," said Sameer Hirji, CEO.

                        About the Company

Tango Incorporated -- http://www.tangopacific.com/-- is a leading  
garment manufacturing and distribution company, with a goal of
becoming a dominant leader in the industry. Tango pursues
opportunities, both domestically and internationally. Tango
provides major branded apparel the ability to produce the highest
quality merchandise, while protecting the integrity of their
brand. Tango serves as a trusted ally, providing them with quality
production and on-time delivery, with maximum efficiency and
reliability. Tango becomes a business partner by providing
economic solutions for development of their brand. Tango provides
a work environment that is rewarding to its employees and at the
same time has an aggressive plan for growth. Tango is currently
producing for many major brands, including Nike, Nike Jordan and
RocaWear.

                          *     *     *

                       Going Concern Doubt

In its Form 10-QSB for the quarterly period ended April 30, 2004,
filed with the Securities and Exchange Commission, Tango Inc.
reported that, as of April 31, 2003 and 2004, its auditors
expressed substantial doubt about the company's ability to
continue as a going concern in light of continued net losses and
working capital deficits.


TENNECO AUTOMOTIVE: S&P Places 'B-' Rating on $350M Sr. Sub. Notes
------------------------------------------------------------------
Standard & Poor's Ratings Services assigned its 'B-' subordinated
debt rating to Lake Forest, Illinois-based Tenneco Automotive
Inc.'s $350 million senior subordinated notes, due 2014, to be
issued in accordance with Rule 144A with registration rights. At
the same time, Standard & Poor's affirmed its 'B+' corporate
credit rating and all other ratings on Tenneco, a global
manufacturer of automotive components.

The company has about $1.4 billion of outstanding debt. The
outlook is positive.

Proceeds from the new debt issue will be used to redeem a portion
of the firm's 11 5/8% senior subordinated notes, due 2009. With
this transaction, Tenneco expects to reduce annual interest
expense by about $10 million.

"Ratings could be raised if operating performance continues to
strengthen with free cash flow earmarked primarily for debt
reduction, or if Tenneco, at some later date, goes forward with a
common equity offering, with proceeds used to pay down high coupon
debt," said Standard & Poor's credit analyst Daniel DiSenso.

Tenneco is a leading global supplier of emissions control and ride
control products to the automotive original equipment (OE) market
and aftermarket.

"Coming stricter emission control standards, demand for improved
vehicle stability, as well as expected growth of the Chinese
automotive market create favorable growth prospects for the
company," Mr. DiSenso said.


TRAILER BRIDGE: Plans to Offer $80 Million of Senior Secured Notes
------------------------------------------------------------------
Trailer Bridge, Inc. (NASDAQ: TRBR) intends to offer $80 million
in aggregate principal amount of senior secured notes due 2011,
subject to market and other conditions.

Trailer Bridge anticipates using the proceeds of the Notes to fund
the purchase price for all of the outstanding stock of
Kadampanattu Corp. and to retire certain indebtedness of K. Corp.
In addition, a portion of the proceeds will be used to retire
certain indebtedness of Trailer Bridge and to acquire certain
containers and chassis that are currently leased to the Company
and utilized in its operations. K. Corp. currently owns and leases
to Trailer Bridge two triple-deck roll-on, roll-off barges for
$7.3 million per year. Trailer Bridge has entered into an
agreement where it can buy 100% of the common stock of K. Corp.
for $32 million.

The Notes will be sold to qualified institutional buyers under
Rule 144A under the Securities Act of 1933, as amended, to persons
outside the United States in compliance with Regulation S under
the Securities Act or to institutional accredited investors within
the meaning of Rule 501 (a)(1), (2), (3) or (7) of the Securities
Act. The Notes have not been registered under the Securities Act,
and may not be offered or sold in the United States absent regist
ration or an applicable exemption from registration requirements.
This press release shall not constitute an offer to sell or a
solicitation of an offer to buy the Notes, nor shall there be any
sale of the Notes in any state in which such offer, solicitation
or sale would be unlawful prior to registration or qualification
under the securities laws of such state or jurisdiction.

                      About Trailer Bridge

Trailer Bridge, Inc. -- http://www.trailerbridge.com/-- provides  
integrated trucking and marine freight service to and from all
points in the lower 48 states and Puerto Rico, bringing
efficiency, service, security and environmental and safety
benefits to domestic cargo in that traffic lane. This total
transportation system utilizes its own trucks, drivers, trailers,
containers and U.S. flag vessels to link the mainland with Puerto
Rico via marine facilities in Jacksonville and San Juan.

Moody's Investors Service assigned a B3 rating to the company's
proposed $80 million senior secured notes, due 2011.


TRAILER BRIDGE: Moody's Rates Proposed $80M Sr. Secured Notes B3
----------------------------------------------------------------
Moody's Investors Service assigned these ratings to Trailer
Bridge, Inc.:

   * B3 to the company's proposed $80 million senior secured
     notes, due 2011;

   * Senior implied rating of B3; and

   * Issuer rating of Caa2.

In addition, Moody's assigned a Speculative Grade Liquidity Rating
of SGL-3.

The rating outlook is stable. This is a first time public rating
of the company.

The ratings reflects high debt levels that will ensue from the
proposed refinancing, the company's moderate liquidity position,
modest asset coverage provided to these notes, as well as the
company's small revenue base and lack of diversification in
shipping routes served. The ratings are supported by the niche
market protection afforded to the company as a U.S. Jones Act
operator of shipping tonnage, recent improvements that the company
has experienced in its main operating route, and strong, long-term
contract relationships with major shipping customers. The stable
outlook reflects Moody's expectations that the company's operating
performance, bolstered by fixed-term contracts with key shippers
at increased freight rates, will continue to improve through 2005,
providing the company with stronger liquidity and greater
capability to repay debt. Ratings or their outlook would be
subject to downward revision if the company's operating
performance were not to improve substantially from recent
historical levels, with free cash flow remaining below 5% of total
debt for a prolonged period of time, or if substantial amounts of
funds generated through operations were to be diverted from the
company, possibly to purchase shares, although such a purchase is
currently limited to a great degree by the notes' restricted
payments covenants. Ratings would be subject to improvement if the
company were to substantially improve operating results, resulting
in lease-adjusted debt-to-EBITDAR of less than 5x.

The purpose of the proposed facilities is:

   (a) to fund the acquisition of 100% of the stock of K-Corp,
       currently a key lessor of equipment to the company that is
       wholly owned by a major shareholder in Trailer Bridge, for
       approximately $32 million,

   (b) to refinance approximately $32 million of the company's
       existing senior secured debt,

   (c) to exercise a $12 million option on certain container
       leases, as well as

   (d) for transaction fees.

On closing, the company will have approximately $106 million of
debt.

As a result of the proposed refinancing and acquisition, Trailer
Bridge's total debt will increase almost threefold, from $38.4
million as of September 2004 to about $106 million. Resulting
leverage will be quite high, at 5.8x pro forma debt-to-estimated
LTM September 2004 EBITDA. Considering the company's high level of
operating expenses, particularly lease expenses associated with
the company's time charters on tug vessels, which provide all of
the company's seaborne propulsion capability, lease-adjusted debt
represents almost 7x EBTIDAR. Moreover, Moody's notes that Trailer
Bridge's pro forma balance sheet will contain only modest levels
of fixed asset investment relative to other shipowner/operators as
well as to the company's size. Of an estimated $105 million of
total assets upon close of the proposed transaction, about $82
million is represented by fixed assets, specifically two Roll-On,
Roll-Off (RO/RO) barges that the company owns which provide
collateral to these notes. This implies limited asset coverage for
the senior secured facilities, and, in Moody's opinion, a high
risk of loss on recovery in the event of default. This also
implies a limitation on the company's ability to decrease its
leverage by way of asset sales, if necessary.

Moody's recognizes certain benefits that the company enjoys from
the unique operating characteristics of the barges employed in
niche market routes, which will likely support Trailer Bridge's
stability in market share and pricing. A leading provider of
trucking and marine transportation services from the Southeast
U.S. to Puerto Rico (approximately 13% market share of southbound
mainland U.S. to Puerto Rico trade, per company estimates),
Trailer Bridge owns and operates five large ocean-going container
barges with total capacity of 1,325 53-foot high-cube container
units, and two specialized roll-on, roll-off (RO/RO) barges with
capacity of 405 units each. By not owning self-propelled vessels,
the company can forego a large component of capital cost
associated with investment in such tonnage, instead chartering-in
tug boats from third parties to provide propulsion. This affords
the company substantial flexibility to match much of its marine
transportation equipment requirements to changes in the market in
which it operates. This also removes expensive vessel operating
costs, especially crew costs, from the company's cost basis.
However Moody's does believe that, over the longer-term, this
level of purchased transportation services implies additional risk
that the company may not be able to secure its tug requirements at
terms similar to those Trailer Bridge currently enjoys.

The B3 rating assigned to the senior secured notes, which is the
same as the senior implied rating, reflects the preponderance of
senior debt represented by these notes in the company's capital
structure. The $80 million notes represent about 76% of the total
of $106 million of balance sheet debt, with about $23 million of
MARAD Title XI Bonds comprising most of the rest of the debt. The
MARAD debt is likewise secured on a first priority mortgage bases
on certain marine assets that are not among collateral provided to
these notes. The company estimates market value of barges and
other equipment securing the notes to be about $95 million,
implying ample, although not robust asset coverage. Moody's notes,
however, that the unique operating characteristics of these barges
imply intrinsic values that are closely tied to the strength of
the markets in which they operate. This casts doubt on the demand
for such assets outside of their use in U.S. flag Jones Act
trading, and suggests risk that fair market value for these assets
could fall substantially below current appraised values,
particularly in a distressed sale scenario. These notes are
guaranteed by Trailer Bridge Inc. and all future subsidiaries
holding collateral securing these notes.

The Speculative Grade Liquidity Rating of SGL-3 reflects Moody's
assessment of an adequate liquidity profile. Upon close of the
proposed transaction, the company will have a minimal cash
balance, estimated to be about $2 million. Trailer Bridge plans to
have a borrowing base facility with a currently-estimated
availability of $10 million in place, after having re-paid all
existing senior secured facilities and terminating the current $20
million revolving credit facility. In Moody's opinion, this gives
the company only modest latitude to cover potential cash
shortfalls. Free cash flow is projected to be thin in FY 2004
(approximately $5.6 million, pro forma the transactions) after a
number of years of negative free cash flow generation. The rating
agency believes that this exposes the company to near-term
tightness in liquidity that might result from temporary market
softness, increases in equipment lease expenses, or increased
price competition from larger competitors. Also, with essentially
all assets on the company's balance sheet encumbered by debt,
either through the proposed notes or MARAD debt, Moody's believes
that the company's ability to raise funds through additional
indebtedness to be quite limited.

Trailer Bridge, headquartered in Jacksonville, Florida, is an
integrated trucking and marine freight carrier that provides
truckload freight transportation primarily between the continental
U.S. and Puerto Rico. The company had FY 2003 revenues of
$86.4 million.


TRAILER BRIDGE: Third Qtr. Net Income Up $2 Mil. From Last Year
---------------------------------------------------------------
Trailer Bridge, Inc. (NASDAQ: TRBR) reported financial results for
the third quarter ended September 30, 2004, highlighted by net
income of $1,154,205, a $2.0 million improvement compared to the
third quarter of 2003.

Total revenue for the three months ended September 30, 2004 was
$23,938,849, an increase of $1,319,377, or 5.8%, compared to the
third quarter of 2003. The effective revenue per container
equivalent of all of the southbound cargo represented an increase
of 5.9% from the year earlier period.

The Company's Jacksonville-San Juan deployed vessel capacity
utilization during the third quarter was 94.9% to Puerto Rico and
28.6% from Puerto Rico compared to 93.3% and 25.3%, respectively,
during the third quarter of 2003. The operating income for the
third quarter ended September 30, 2004 improved to $1,898,233, an
improvement of $2,050,637 compared to the operating loss of
$152,404 in the prior year period. The operating ratio was 92.1%
during the third quarter of 2004, compared to an operating ratio
of 101.1% during the year earlier period and 92.9% during the
second quarter of 2004.

Net income for the third quarter of 2004 was $1,154,205, an
improvement of $2,017,424 compared to a net loss of $863,219 in
the same period last year. After the effect of an undeclared
preferred stock dividend and accretion of preferred stock discount
related to the preferred stock held by its Kadampanattu Corp.
affiliate, the Company recorded net income per diluted common
share of $.05 in the third quarter of 2004 compared to a net loss
per diluted common share of $.13 in the year earlier period, and
net income per diluted common share of $.04 in the second quarter
of 2004.

John D. McCown, Chairman and CEO, said, "The effects of an
improving supply/demand equation continue to roll out and the
underlying trends in our business remain very strong. Despite an
unusually active hurricane season that caused some schedule
disruption in September, Trailer Bridge still increased its total
operating revenues for the quarter. Those sailings that were
delayed were pushed into the fourth quarter, and now our vessels
are back on schedule and the Company is busier than it was before
these September storms."

                      About Trailer Bridge

Trailer Bridge, Inc. -- http://www.trailerbridge.com/-- provides  
integrated trucking and marine freight service to and from all
points in the lower 48 states and Puerto Rico, bringing
efficiency, service, security and environmental and safety
benefits to domestic cargo in that traffic lane. This total
transportation system utilizes its own trucks, drivers, trailers,
containers and U.S. flag vessels to link the mainland with Puerto
Rico via marine facilities in Jacksonville and San Juan.

Moody's Investors Service assigned a B3 rating to the company's
proposed $80 million senior secured notes, due 2011.


URECOATS INDUSTRIES: Discontinues RSM Tech. Unit's Operations
-------------------------------------------------------------
Urecoats Industries Inc. (Amex: URT) has discontinued the
operations of its subsidiary, RSM Technologies, Inc., based on
numerous factors but primarily to mitigate the current and future
financial impacts of continuing operations. The Company's other
subsidiary, Infiniti Products, Inc., will continue its operations.

Urecoats Industries Inc., RSM Technologies, Inc. (f/k/a Urecoats
Manufacturing, Inc.), the inactive subsidiary, Urecoats
Technologies, Inc. and Richard J. Kurtz, are pursuing
counterclaims against Plymouth Industries, Inc., in Minnesota,
for, among other things, breach of contract in connection with an
alleged latent defect discovered in the manufacture of RSM
Technologies, Inc.'s BlueMAX(TM) spray application system and
seeking recovery of a substantial amount of the losses related to
the BlueMAX(TM) program which approximate $20 million.

"The Company has spent years pursuing the commercialization of the
RSM Series(TM) product line," stated Michael T. Adams, President
of Urecoats Industries Inc. "The impact of a latent defect
discovered in the BlueMAX(TM) spray application system allegedly
attributable to the engineering services provided as part of the
Manufacturing and Sales Agreements between RSM Technologies, Inc.,
Urecoats Technologies, Inc. and Plymouth Industries, Inc.,
effectively destroyed this customer base and put RSM Technologies,
Inc. out of business," continued Mr. Adams.

"The Company diversified its operations in 2001 with the
acquisition of Infiniti Products, Inc., which accounted for
approximately 75% of the Company's consolidated revenues and
approximately 7% of the Company's consolidated losses for the six
months ended June 30, 2004. Infiniti has also just completed and
began operating its own manufacturing facility. As a result,
Infiniti is expected to improve its margins in the near term,
however, revenues must increase in order to achieve profitability
in the long-term. We have eliminated the financial drain of RSM
Technologies, Inc. and are at the forefront of a period of growth
as we develop new opportunities for our Infiniti product lines,"
Mr. Adams concluded.

               The Plymouth Industries Inc. Lawsuit

Plymouth Industries, Inc., Plaintiff v. Urecoats Industries Inc.,
Urecoats Manufacturing, Inc. (n/k/a RSM Technologies, Inc.),
Urecoats Technologies, Inc. and Richard J. Kurtz, Defendants.

On July 22, 2003, the Plaintiff served the Defendants with a
complaint for breach of Manufacturing and Sales Agreements and the
parties immediately entered into various settlement agreements
during which the Defendants were granted an indefinite extension
of time to answer the complaint. The Defendants ceased making
settlement payments in September 2003 when the Defendants came to
believe and later learned that the Plaintiff had breached the
Manufacturing and Sales Agreements and thereafter served a joint
answer denying the complaint's allegations and counterclaimed
against the Plaintiff for breach of contract, breach of
warranties, and indemnity and contribution. On April 27, 2004, the
Plaintiff filed the aforementioned complaint in the District Court
of the Fourth Judicial District in Hennepin County, Minnesota. On
July 13, 2004, the Defendants filed the aforementioned joint
answer and counterclaims with said District Court. On August 4,
2004, the Plaintiff was granted summary judgment against the
Defendants, joint and severally, in the amount of $738,163 with
any applicable costs, fees, and pre-judgment interest to be
determined and added to this summary judgment at a later date. The
Defendants believed that reversible procedural and substantive
errors were made and that valid legal redress existed to not only
offset the summary judgment with counterclaims but also to
potentially vacate the summary judgment. On October 27, 2004, the
Court issued an order granting the Defendants' motion to vacate
the summary judgment ordered on August 4, 2004. The outcome of
this litigation and its potential financial impacts cannot be
determined at this time.

                   About Infiniti Products, Inc.

Infiniti Products, Inc. develops, markets, sells, manufactures,
and distributes coatings, paints, and sealants to the
construction, paint, roofing, and waterproofing industries.

                  About Urecoats Industries Inc.

Urecoats Industries Inc. is a holding company with one wholly
owned subsidiary, Infiniti Products, Inc., with continuing
operations.

At June 30, 2004, Urecoats Industries' balance sheet showed a
$5,685,653 stockholders' deficit, compared to a $2,569,668 deficit
at Dec. 31, 2003.


UAL CORP: Stay Lifted for HSBC to Access $4.9MM Construction Fund
-----------------------------------------------------------------
On September 30, 2004, UAL Corporation and its debtor-affiliates
submitted a draw request to HSBC Bank USA for $4,891,600.  HSBC
and the Debtors do not dispute the facts set for in HSBC's request
or that the Debtors have submitted to HSBC the Postpetition Draw
Request.  The parties, however, dispute whether:

   (i) HSBC is entitled to effectuate its set-off rights and
       apply and disburse the $4,891,600 of the funds on deposit
       in the Los Angeles International Airport Bond Series 1997
       Construction Fund;

  (ii) HSBC should be required to pay the Retained Funds over to
       the Debtors.

The parties agreed that HSBC's request requires consideration by  
the Court of issues that were raised in an adversary proceeding  
commenced by the Debtors against U.S. Bank Trust, National  
Association, Adv. Pro. No. 03-A-04771.  The issues in the U.S.  
Bank Proceeding relate to certain amounts on deposit in a  
construction fund established under an indenture related to the  
California Statewide Communities Development Authority Special  
Facilities Revenue Bonds (United Air Lines, Inc. -- Los Angeles  
International Airport Cargo Projects) Series 2001.  In the  
Proceeding, the Debtors sought to compel U.S. Bank to turnover  
certain amounts U.S. Bank held in the construction fund.

To limit expense and conserve judicial resources, the Debtors and  
HSBC agreed to period continuance of the hearing and objection  
deadlines with respect to HSBC's request pending the Court's  
ruling in the U.S. Bank Proceeding.  As a result of the  
continuance, the Debtors have not yet filed an objection.

On September 20, 2004, the Court issued its opinion with respect  
to the U.S. Bank Proceeding.  The Debtors and HSBC agree that the  
U.S. Bank Opinion is dispositive of the Court's position relating  
to the issues raised in HSBC's request.

In a Stipulation and Agreed Order approved by Judge Wedoff, the  
parties agree that the stay should be lifted so HSBC may apply  
and disburse the $4,891,600 in Retained Amounts still held in the  
Construction Fund, together with any interest earned.  HSBC,  
however, will not apply and disburse the Funds unless and until  
all appeals from the Order approving the Stipulation are fully  
and finally adjudicated.

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


UAL CORP: Gets Court Nod to Amend Service Agreement with ARINC
--------------------------------------------------------------
Pursuant to a service agreement, ARINC provides VHF and Satcom  
data/voice radio and communication network services to UAL
Corporation and its debtor-affiliates.  ARINC's communication
network services are used to transmit Aircraft Communication
Addressing and Reporting System data, which is flight-critical
operational information transmitted between flight crews and
ground stations while planes are in flight.

There are two main providers of VHF and Satcom services -- SITA  
and ARINC.  However, in North America, ARINC is the only provider  
with sufficient terrestrial ground station coverage to service  
the Debtors' flight schedules and network.

In 2003, the Debtors commenced efforts to introduce competition  
in the North American VHF data services market.  The Debtors  
investigated the technical and financial risks and benefits of  
contracting with SITA to invest in the North American market and  
establish a competitive VHF network.  After a thorough review,  
the Debtors decided against this venture and, instead, to  
continue their relationship with ARINC.

By this motion, the Debtors sought and received Court permission  
to amend the existing Services Agreement with ARINC.  Under the  
Amendment:

  a) the Debtors will pay about 50%, or $100,000, less per month  
     than their current VHF payments to ARINC;

  b) the Debtors will have the option of using other service  
     providers for air-to-ground communications if new, cheaper  
     technologies are developed;

  c) ARINC will acknowledge that the Amendment does not  
     constitute an assumption of the Services Agreement;

  d) the Debtors will assume the Services Agreement upon exit  
     from bankruptcy; and

  e) if the Debtors do not assume the Service Agreement, ARINC  
     will be allowed an administrative claim under the historic,  
     higher prices.

James H.M. Sprayregen, Esq., at Kirkland & Ellis, in Chicago,  
Illinois, relates that the Amendment will allow the Debtors to  
take advantage of favorable economic terms without assuming the  
Services Agreement.  The Amendment will defer payment of ARINC's  
$2,800,000 cure claim until the Debtors have exited from  
bankruptcy.  After the Amendment, the Debtors anticipate paying  
ARINC a minimum of $230,000 per month.


US AIRWAYS: Judge Mitchell Appoints 5-Member Retiree Committee
--------------------------------------------------------------
Judge Mitchell of the U.S. Bankruptcy Court for the Eastern
District of Virginia grants the request of US Airways, Inc., and
its debtor-affiliates for appointment of a Retiree Committee.

The Official Committee of Retired Employees of US Airways will
consist of:

     1. ALPA -- Thomas G. Davis
     2. AFA -- Judith M. Schmidt
     3. CWA -- Judy W. Dreyer
     4. Non-Union Retirees -- James E. Lloyd
     5. Non-Union Retirees -- Gerard Carusi

Judge Mitchell notes that the Transportation Workers Union and the
International Association of Machinists and Aerospace Workers did
not provide notice of an election not to serve.  Accordingly, TWU
and IAM will serve as authorized representatives of TWU and IAM
retirees.

Headquartered in Arlington, Virginia, US Airways' primary business
activity is the ownership of the common stock of:

         * US Airways, Inc.,
         * Allegheny Airlines, Inc.,
         * Piedmont Airlines, Inc.,
         * PSA Airlines, Inc.,
         * MidAtlantic Airways, Inc.,
         * US Airways Leasing and Sales, Inc.,
         * Material Services Company, Inc., and
         * Airways Assurance Limited, LLC.

Under a chapter 11 plan declared effective on March 31, 2003,
USAir emerged from bankruptcy with the Retirement Systems of
Alabama taking a 40% equity stake in the deleveraged carrier in
exchange for $240 million infusion of new capital.

US Airways and its subsidiaries filed another chapter 11 petition
on September 12, 2004 (Bankr. E.D. Va. Case No. 04-13820).  Brian
P. Leitch, Esq., Daniel M. Lewis, Esq., and Michael J. Canning,
Esq., at Arnold & Porter LLP, and Lawrence E. Rifken, Esq., and
Douglas M. Foley, Esq., at McGuireWoods LLP, represent the Debtors
in their restructuring efforts.  In the Company's second
bankruptcy filing, it lists $8,805,972,000 in total assets and
$8,702,437,000 in total debts. (US Airways Bankruptcy News, Issue
No. 70; Bankruptcy Creditors' Service, Inc., 215/945-7000)


US AIRWAYS: Asks Court to Approve De Minimis Asset Sale Procedures
------------------------------------------------------------------
Before US Airways, Inc., and its debtor-affiliates filed for
chapter 11 petition, the Debtors routinely sold assets that were
extraneous to their businesses, were underperforming or had little
or no value to their operations.  As the Debtors continue to
reorganize and identify underperforming and non-performing assets,
the Debtors will sell or transfer these assets.  Many of the sales
will involve assets of de minimis value in relation to the
Debtors' asset base.

Brian P. Leitch, Esq., at Arnold & Porter, in Denver, Colorado,
explains that it will be inefficient to seek Court approval each
and every time the Debtors sell assets.  Thus, the Debtors seek
the Court's permission to sell de minimis assets at their
discretion.

The Debtors plan to implement global expedited procedures to
effectuate sales of obsolete, excess, burdensome or relatively de
minimis assets with a selling price of no more than $15,000,000 in
any individual transaction or series of related transactions to a
single buyer or group of related buyers, whether or not free and
clear of all liens, claims, interests or encumbrances, which those
liens attaching to the sale proceeds in the same validity, extent
and priority as immediately prior to the sale.

    A. With regard to sales of De Minimis Assets with a selling
       price equal to or less than $1,500,000:

       (1) The Debtors are authorized to consummate those
           transactions, if the Debtors determine in the
           reasonable exercise of their business judgment that
           those sales are in the best interest of their estates,
           without further Court order;

       (2) The transactions will be free and clear of all liens,
           with the liens attaching only to the sale proceeds in
           the same validity, extent and priority as immediately
           prior to the transaction;

       (3) The Debtors will give written notice of each sale to
           known affected creditors asserting a lien at least
           seven days prior to closing;

       (4) The Debtors will consummate the sale if no objection is
           filed within five days; and

       (5) If an objection is received from a creditor asserting a
           lien, the asset will be sold upon further Court order
           and a hearing on the objection will be scheduled.

    B. With regard to sales of De Minimis Assets with a selling
       price greater than $1,500,000 and up to $15,000,000:

       (1) The Debtors are authorized to consummate the
           transaction without further Court order, if the sale is
           in their best interest;

       (2) The transactions will be free and clear of all liens,
           with liens attaching only to the sale proceeds in the
           same validity, extent and priority as immediately prior
           to the transaction;

       (3) The Debtors will serve a Sale Notice on:

           -- any creditor asserting a lien,
           -- the United States Trustee,
           -- counsel for the Debtors' lenders, and
           -- counsel to any Official Committee appointed,

           at least seven days prior to closing;

       (4) The Debtors will consummate the sale if no objection is
           filed within five days; and

       (5) If an objection is received from a creditor asserting a
           lien, the asset will be sold upon further Court order
           and a hearing on the objection will be scheduled.

Implementation of this process to sell de minimis assets will
provide the Debtors with flexibility during the reorganization.
The threshold amounts are reasonable in light of the Debtors'
everyday operations.  The procedures will enable the Debtors to
avoid the high costs of maintaining these assets and improve their
overall liquidity.

Headquartered in Arlington, Virginia, US Airways' primary business
activity is the ownership of the common stock of:

         * US Airways, Inc.,
         * Allegheny Airlines, Inc.,
         * Piedmont Airlines, Inc.,
         * PSA Airlines, Inc.,
         * MidAtlantic Airways, Inc.,
         * US Airways Leasing and Sales, Inc.,
         * Material Services Company, Inc., and
         * Airways Assurance Limited, LLC.

Under a chapter 11 plan declared effective on March 31, 2003,
USAir emerged from bankruptcy with the Retirement Systems of
Alabama taking a 40% equity stake in the deleveraged carrier in
exchange for $240 million infusion of new capital.

US Airways and its subsidiaries filed another chapter 11 petition
on September 12, 2004 (Bankr. E.D. Va. Case No. 04-13820).  Brian
P. Leitch, Esq., Daniel M. Lewis, Esq., and Michael J. Canning,
Esq., at Arnold & Porter LLP, and Lawrence E. Rifken, Esq., and
Douglas M. Foley, Esq., at McGuireWoods LLP, represent the Debtors
in their restructuring efforts.  In the Company's second
bankruptcy filing, it lists $8,805,972,000 in total assets and
$8,702,437,000 in total debts. (US Airways Bankruptcy News, Issue
No. 70; Bankruptcy Creditors' Service, Inc., 215/945-7000)


USG CORP: Wants Ruling that Only U.S. Gypsum Has Tort Liability
---------------------------------------------------------------
On November 8, 2004, these Debtors:

    -- USG Corporation;
    -- USG Interiors, Inc.;
    -- USG Interiors International, Inc.;
    -- L & W Supply Corporation;
    -- Beadex Manufacturing, LLC;
    -- B-R Pipeline Company;
    -- La Mirada Products Co., Inc.;
    -- USG Industries, Inc.;
    -- USG Pipeline Company; and
    -- Stocking Specialists, Inc.,

filed a complaint against Dean M. Trafelet, the legal
representative for persons who might subsequently assert asbestos-
related personal injury claims, and the Official Committee of
Asbestos Personal Injury Claimants.

The Debtor-Plaintiffs seek a declaration that they are not liable
for, and their assets are not available to satisfy claims arising
from the asbestos liabilities of Debtor United States Gypsum
Company, which is not a plaintiff.

Daniel J. DeFranceschi, Esq., at Richards, Layton & Finger, P.A.,
in Wilmington, Delaware, contends that the requested declaratory
relief is necessary to:

    (a) help enable the Debtors to file a reorganization plan; and

    (b) facilitate all parties' efforts to consensually resolve
        the outstanding issues between them.

Mr. DeFranceschi clarifies that the Futures Representative and the
Asbestos PI Committee are being sued in their representative
capacity.

The Debtor-Plaintiffs intend to prevent the Futures Representative
and the PI Committee from improperly holding them liable for
Gypsum's asbestos liabilities or otherwise using their assets to
satisfy those liabilities.  These matters raise significant issues
that implicate the administration of the Debtors' estate.

The Debtor-Plaintiffs allege that the Futures Representative and
the Asbestos PI Committee assert, or will assert, that even if the
Debtor-Plaintiffs do not have direct liability to future and
current personal injury claimants, their aggregate assets should
be used to compensate the claimants for Gypsum's present asbestos
liabilities through the use of substantive consolidation.  The
Futures Representative and the PI Committee also assert, or will
assert, that the scope of asbestos liabilities in the Debtors'
Chapter 11 proceedings extends not only to Gypsum but also to USG
Corporation and its other subsidiaries based on various other
legal theories, making contentions despite facts demonstrating
that:

    (1) only Gypsum manufactured the asbestos-containing products
        at issue in the present and future asbestos claims;

    (2) only a small handful of the more than 100,000 claims that
        have been filed against any of the USG-related entities
        was filed against an entity other than Gypsum;

    (3) Gypsum's reorganization -- occurring nearly 20 years ago
        -- was intended to serve legitimate business purposes; and

    (4) the entities formed as a result of Gypsum's reorganization
        have maintained appropriate corporate separateness at all
        relevant times.

The Debtors are in bankruptcy to resolve Gypsum's asbestos-
related liabilities in a manner that is fair to all
constituencies, including claimants injured by Gypsum's asbestos-
containing products, other creditors, and shareholders of USG.
According to Mr. DeFranceschi, if due consideration is given to
the nature and use of Gypsum's products, as well as applicable
legal and evidentiary standards, Gypsum can pay in full all valid
personal injury and other claims and preserve value for USG
shareholders.  Gypsum currently has sufficient assets and income
to continue to pay its debts as they come due.

The Futures Representative and the PI Committee have asserted or
will assert that the Debtor-Plaintiffs are liable for the
asbestos-related claims and demands against Gypsum and that they
should be responsible for satisfying these claims and demands
without limiting their arguments to any particular theory or
theories of liability, including substantive consolidation,
fraudulent conveyance, successor liability and piercing the
corporate veil.

          Gypsum's History and its 1984 Reorganization

Mr. DeFranceschi relates that Gypsum was formed in 1902 as a
Chicago-based company, and it became and remains today the largest
drywall and plaster company in the United States.  Certain of the
products sold by Gypsum at various times contained small amounts
of asbestos.  All asbestos was removed from Gypsum's products by
1978 and as of 1984, Gypsum had only a relatively small number of
asbestos cases pending against it.

Through the first seven decades of Gypsum's existence, it was
primarily a gypsum and wallboard company that had few domestic
operating subsidiaries and no other significant businesses.  
Gypsum expanded significantly in the 1970s and early 1980s into a
much more diversified conglomerate, with numerous divisions,
subsidiaries and products worldwide.

Gypsum's management increasingly found in 1984 that this
diversification, including the major acquisition of Masonite
Corp., along with Gypsum's annual revenue growth increases -- from
$1.3 billion in 1982, to $1.6 billion in 1983, to $2.3 billion in
1984 -- were causing significant management challenges that had
left Gypsum with an unwieldy corporate structure.  Furthermore, it
also became clear to Gypsum management that it simply had too many
operating divisions and subsidiaries in its present structure,
which did not present an adequate framework to accommodate further
growth or to facilitate additional acquisitions.  As a result,
Gypsum management decided that it wanted to place its non-gypsum
businesses into separate companies in an effort to create a more
efficient and effective corporate structure and to create a
framework for continued acquisitions and growth.

Thus, Gypsum stockholders adopted an Agreement and Plan of Merger
proposed by Gypsum management, pursuant to which Gypsum became a
wholly owned subsidiary of a holding company, USG.  USG became the
publicly held parent of Gypsum and Gypsum stockholders became USG
stockholders.

As part of this reorganization, Gypsum distributed the assets and
liabilities of its metal products division and its acoustical and
mineral fiber division into two newly incorporated subsidiaries
-- USG Industries, Inc., and USG Acoustical Products Co.  Gypsum
distributed the stock of those newly formed subsidiaries to USG.  
Gypsum also transferred to USG all of the outstanding shares of
its subsidiaries, including AP Green Refractories, Masonite
Corp., L & W Supply Corp., USG Foreign Investments Inc., Hollytex
Carpet Mills Inc., and Wiss Janney Elstner & Assoc.

The reorganization was, in essence, a logical extension of the
then-existing procedures and practices and was intended to reflect
more accurately the true operating structure of Gypsum's
businesses.  The restructuring kept intact Gypsum's six principal
domestic subsidiaries -- AP Green, Masonite Corp., L&W Supply
Corp., USG Foreign Investments, Inc., Hollytex Carpet Mills, Inc.,
and Wiss Janney Elstner & Assoc.  A new subsidiary, USG
Industries, took over certain of Gypsum's metal products
operations.  A second new subsidiary, USG Acoustical Products Co.,
took over Gypsum's acoustical and mineral fiber division.  
Finally, Gypsum retained the assets of its wallboard and other
gypsum products businesses, and Gypsum became a subsidiary of USG.  
Consistent with pre-organization realities, the resulting entities
thus focused on separate markets and services and retained the
assets relating to those businesses.  Both before and after the
1984 reorganization, the Gypsum business accounted for the
majority of USG enterprise annual sales.

               Defendants' Various Potential Theories
                      of Expanded Liabilities

Mr. DeFranceschi argues that none of the theories that the Futures
Representative and the PI Committee have advanced in favor of
using the assets of the Debtor-Plaintiffs to satisfy Gypsum's
liabilities can withstand scrutiny as a viable theory.

There is no valid reason for invoking substantive consolidation,
piercing the corporate veil, finding successor liability, or
finding that a fraudulent transfer has taken place.  This is so,
in part, because there are no facts relating to the 1984
Reorganization suggesting that any of these legal theories is
viable.  It can and will be demonstrated that:

    (a) The 1984 Reorganization was done for valid business
        purposes;

    (b) The resulting companies that were formed in 1984 were
        created with sufficient capitalization;

    (c) The capitalization was reasonably deemed sufficient to
        handle all future liabilities because, in part, Gypsum
        management had previously put into place, well before the
        1984 Reorganization, a strong, comprehensive insurance
        coverage program that, by all indications at that time,
        appeared to be more than sufficient to cover all of
        Gypsum's present and future asbestos-related liabilities;

    (d) Each subsidiary was given appropriate controls over its
        own business operations as a result of the reorganization;
        and

    (e) Finally, although there are multiple other reasons for
        leaving the 1984 Reorganization intact, the easiest and
        most dispositive reason is that all relevant statutes of
        limitations have expired -- including the two-year
        limitations period under Section 546(a) of the Bankruptcy
        Code -- and the doctrine of laches should apply, with
        respect to any attempts to challenge that reorganization
        or its consequences.

Because it has been nearly 20 years, the time to challenge the
reorganization has long since expired, Mr. DeFranceschi points
out.

In addition, analyses of the present operations and structure also
demonstrate that none of the legal theories that the Futures
Representative and the PI Committee have raised, or are expected
to raise, can succeed.  The Debtor-Plaintiffs can and will
demonstrate that:

    (a) Each subsidiary continues, to this day, to retain
        appropriate controls over its own business operations;

    (b) Each subsidiary observes appropriate corporate
        formalities, as each entity has maintained a properly
        constituted board of directors, elected appropriate
        officers, has its own charter and by-laws, and has
        maintained independent corporate records; and

    (c) The operating subsidiaries generate their own revenue.
        Although public, consolidated financial statements are
        prepared, separate accounting statements exist for each
        subsidiary.  The assets and liabilities of each entity can
        thus be readily ascertained.

                Declaratory Relief Should be Granted

Mr. DeFranceschi contends that the Futures Representative and the
PI Committee cannot show that:

    * there is substantial identity between the Debtor-Plaintiffs
      and Gypsum or that the entities' operations are so entangled
      that it would be impossible or unduly costly to segregate
      and ascertain each entity's assets and liabilities;

    * consolidation is necessary to avoid harm or realize benefits
      to the personal injury claimants;

    * the Debtor-Plaintiffs and their creditors would be unharmed
      by substantive consolidation, as the Debtor-Plaintiffs
      would, in fact, be severely prejudiced by substantive
      consolidation and similarly, certain other creditors would
      also be hurt if substantive consolidation were adopted;

    * Gypsum underwent corporate reorganization with the actual
      intent to hinder, delay or defraud its present or future
      creditors;

    * Gypsum's corporate reorganization constituted a conveyance
      made without reasonably equivalent value;

    * Gypsum was insolvent at the time of its reorganization, or
      rendered insolvent as a result of its reorganization;

    * when Gypsum underwent reorganization, it was engaged in
      or about to engage in a business or transaction for which
      its assets were unreasonably small in relation to the
      business or transaction;

    * when Gypsum underwent reorganization, it intended or
      believed or reasonably should have believed that it would
      incur debts beyond its ability to pay as they matured as a
      result of the reorganization;

    * USG Corporation dominated and controlled Gypsum in any way
      that would warrant ignoring the entities' separate corporate
      existence;

    * it would be inequitable, unjust or unfair for the Court to
      uphold legal distinctions between Gypsum and USG
      Corporation;

    * USG Corporation or its subsidiaries, including Gypsum,
      engaged in fraudulent, illegal or wrongful conduct with
      respect to their use of the corporate form which would
      justify piercing the corporate veil.

    * Gypsum's corporate reorganization was a de facto
      consolidation or merger;

    * the Debtor-Plaintiffs are a mere continuation of Gypsum; and

    * the corporation reorganization was for the fraudulent
      purpose of escaping Gypsum's liabilities.

An actual controversy has arisen and now exists between the
parties concerning the Debtor-Plaintiffs' liability for Gypsum's
asbestos liability under a substantive consolidation theory,
fraudulent conveyance theory, corporate veil piercing doctrine,
and successor liability theory, Mr. DeFranceschi says.

Headquartered in Chicago, Illinois, USG Corporation --
http://www.usg.com/-- through its subsidiaries, is a leading  
manufacturer and distributor of building materials producing a
wide range of products for use in new residential, new
nonresidential and repair and remodel construction, as well as
products used in certain industrial processes.  The Company filed
for chapter 11 protection on June 25, 2001 (Bankr. Del. Case No.
01-02094).  David G. Heiman, Esq., and Paul E. Harner, Esq., at
Jones Day represent the Debtors in their restructuring efforts.
When the Debtors filed for protection from their creditors, they
listed $3,252,000,000 in assets and $2,739,000,000 in debts.  (USG
Bankruptcy News, Issue No. 75; Bankruptcy Creditors' Service,
Inc., 215/945-7000)


USOL INC: Voluntary Chapter 11 Case Summary
-------------------------------------------
Debtor: USOL, Inc.
        dba U.S. Online
        203 West 8th Avenue, Suite. 316
        Amarillo, Texas 79101

Bankruptcy Case No.: 04-21355

Type of Business:  The Company is a wholly owned subsidiary of
                   USOL Holdings, Inc.  The Company provides
                   bundled communications services, primarily to
                   multi-family properties.
                   See http://www.usolholdings.com/

Chapter 11 Petition Date: November 8, 2004

Court: Northern District of Texas (Amarillo)

Judge: Robert L. Jones

Debtor's Counsel: Roger S. Cox, Esq.
                  Sanders Baker
                  PO Box 2667
                  Amarillo, Texas 79105-2667
                  Tel: (806) 372-2020
                  Fax: (806) 372-3725

Estimated Assets: $1 Million to $10 Million

Estimated Debts:  $1 Million to $10 Million

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


W.R. GRACE: Has Until November 15 to File Plan of Reorganization
----------------------------------------------------------------
Judge Fitzgerald of the U.S. Bankruptcy Court for the District of
Delaware extended the period within which W.R. Grace & Co., and
its debtor-affiliates have the exclusive right to file a plan of
reorganization until November 15, 2004.

As reported in the Troubled Company Reporter on Nov. 3, 2004, a
meeting among the Debtors, the Asbestos Personal Injury Committee,
and the Asbestos Property Damage Committee, sufficient progress
was made for the parties to conclude that additional negotiations
could lead to a consensual Chapter 11 plan.  "The Debtors and the
Asbestos Committees feel that it would hinder the process, if the
Debtors' current chapter 11 plan were to be filed and made public
at this time," Mr. Carickhoff informed Judge Fitzgerald.

Headquartered in Columbia, Maryland, W.R. Grace & Co., --
http://www.grace.com/-- supplies catalysts and silica products,  
especially construction chemicals and building materials, and
container products globally.  The Debtors filed for chapter 11
protection on April 2, 2001 (Bankr. Del. Case No: 01-01139).  
James H.M. Sprayregen, Esq., at Kirkland & Ellis and Laura Davis
Jones, Esq., at Pachulski, Stang, Ziehl et al. represent the
Debtors in their restructuring efforts.  (W.R. Grace Bankruptcy
News, Issue No. 74; Bankruptcy Creditors' Service, Inc.,
215/945-7000)


W.W. HOLDINGS: Lenders Ready to Auction Collateral on Nov. 12
-------------------------------------------------------------
W.W. HOLDINGS, LLC -- http://www.wwholdingsllc.com/-- owns and  
operates a national group of door and architectural hardware
distributors and a major manufacturer of hollow metal door
products.  W.W. Holdings' secured lenders, owed $69 million,
published this notice of their intention of auction the collateral
securing repayment of their loans:

                      NOTICE OF PUBLIC SALE

PLEASE TAKE NOTICE THAT, on Friday, November 12, 2004, at 10:30
a.m. at the offices of Richards Spears Kibbe & Orbe LLP, One World
Financial Center, 29th Floor, New York New York 10281, in
accordance with:

   (1) Section 9-610 of the Uniform Commercial Code of the state
       of New York,

   (2) the First Amended and Restated Financing Agreement among:

          * W.W. Holdings LLC

            (the Parent Company)

          * Amweld Building Products, LLC
          * Foremost Duct, LLC
          * Firedoor, LLC
          * Sutocon, LLC
          * Three G Industries, LLC
          * Moonlight Door, LLC
          * Builders Specialties & Hardware, LLC
          * Southern Systems, LLC
          * Pleasants Hardware Company
          * Pleasants Florida LLC and
          * Northwest Builders Hardware, LLC

            (individually and collectively, and jointly and
            severally, referred to as the "Borrower"),

          * W.W. Versat, LLC
          * PHC Holding Corp.
          * Opening Specialties and Supply Inc
          * Acacia Millwork, LLC and
          * W.W. Duct Connectors, LLC

            (together with W.W. Holdings LLC, each a "Guarantor")

          * the lenders from time to time party thereto and

          * Patriarch Partners Agency Services, LLC, as agent for
            the Lenders

       dated as of July 29, 2004;

   (3) the Amended and Restated Security Agreement among the
       Borrower, Guarantors, and the Agent, dated as of
       July 29, 2004; and

   (4) the Amended and Restated Pledge Agreement among the
       Borrower, Guarantors and the Agent, dated as of
       July 29, 2004;

the Agent, as the secured party under the Security Agreement and
as the pledgee under the Pledge Agreement, and the Lenders who
hold 100% of the loans made under the Financing Agreement, will
conduct a public sale without reserve of:

   (a) all of the tangible and intangible personal property of
       the Parent, other than the assets of Parent specifically
       identified as "Priority Collateral" on Exhibit A to the
       Intercreditor Agreement, dated as of July 29, 2004,
       between Congress Financial Corporation (Central) and the
       Agent and the proceeds and products, whether tangible or
       intangible, thereof, including proceeds of insurance
       covering any or all of the foregoing (other than Priority
       Collateral), and any and all property resulting from the
       sale, exchange, collection, or other disposition of any of
       the foregoing (other than Priority Collateral), or any
       portion thereof or interest therein, and the proceeds
       thereof, and

   (b) the pledged collateral, consisting of, among other things,
       the Pledged Interests of the Parent identified on Schedule
       A to the Pledge Agreement, the Future Rights and Proceeds
       of the foregoing, all as described in the Pledge
       Agreement.

PLEASE TAKE FURTHER NOTICE THAT, on Monday, November 15, 2004 at
10:30 a.m., at the offices of Richards Spears Kibbe & Orbe LLP,
One World Financial Center, 29th Floor, New York, New York 10281,
in accordance with (1) Section 9-610 of the Uniform Commercial
Code of the State of New York, (2) the Financing Agreement, (3)
the Security Agreement and (4) the Pledge Agreement, the Agent, as
the secured party under the Security Agreement and as the pledgee
under the Pledge Agreement, and the Lenders who hold 100% of the
loans made under the Financing Agreement, will conduct a public
sale without reserve of (a) the Collateral of each Borrower and
each Guarantor (other than the Parent), and any and all property
resulting from the sale, exchange, collection, or other
disposition of any of the foregoing, or any portion thereof or
interest therein, and the proceeds thereof, and (b) the pledged
collateral (the "Other Pledged Shares." and together with the
Parent Pledged Shares, the "Pledged Shares"), consisting of, among
other things, the Pledged Interest of each Borrower and each
Guarantor (other than the Parent) identified on Schedule A to the
Pledge Agreement, the Future Rights and Proceeds of the foregoing,
all as described in the Pledge Agreement; provided, however, the
Collateral shall not include the assets of each Borrower and
Guarantor specifically identified as "Priority Collateral" on
Exhibit A to the Intercreditor Agreement.

Each sale is being held in connection with an outstanding
indebtedness of the Borrower to the Lenders in the outstanding
principal amount of not less than $69,000,000.00.  Bids are
invited.  

The Pledged Shares to be sold have not been registered under the
Securities Act of 1933, as amended, or under the securities laws
of any state. The Lenders and Agent make no representation as to
the financial condition of the issuer of the Pledged Shares. The
Lenders and Agent require that the purchaser of the Pledged Shares
provide an investment letter to the Agent stating that the Pledged
Shares are being acquired for the purchaser's own account and not
with a view to resale or distribution thereof, and further stating
that the purchaser will not resell the Pledged Shares except
pursuant to either the terms of an effective registration under
the Act or a valid exemption from the registration provisions of
the Act.  All sales will be without recourse or warranty.  

The Agent and the Lenders reserve the right to bid for and
purchase the Collateral (other than the Priority Collateral)
and/or the Pledged Shares and to credit the purchase price
therefrom against the respective debts owing and any costs of
sale.  The Agent and Lenders also reserve the right to amend,
adjourn, postpone or cancel the sale with respect to all or part
of the Collateral and/or the Pledged Shares.

All questions and inquiries concerning the sale should be
addressed to:

        Larry G. Halperin, Esq.
        Richards Spears Kibbe & Orbe LLP
        One World Financial Center, 29th Floor
        New York, New York 10281
        Telephone (212) 530-1800


WEIRTON STEEL: Trustee Wants Court Nod on HSBC USA Settlement
-------------------------------------------------------------
After Weirton Steel Corporation and its debtor-affiliates filed
for chapter 11 protection, HSBC Bank USA was appointed as
successor indenture trustee to J.P. Morgan Trust Company, N.A., to
the 8-5/8% 1989 City of Weirton, West Virginia Pollution Control
Revenue Funding Bonds.  HSBC provided a variety of services
relating to the Bonds throughout the course of Weirton's
bankruptcy case.

Subsequently, HSBC filed Claim No. 20439, asserting
administrative priority status, for $229,507 plus additional fees
and expenses it incurred through the Effective Date of Weirton's
Confirmed Plan.

Weirton Steel Corporation's First Amended Plan of Liquidation
became effective on September 8, 2004.

Mark E. Freedlander, Esq., at McGuireWoods, LLP, in Pittsburgh,
Pennsylvania, relates that as an active participant on the
Official Committee of Unsecured Creditors appointed by the Office
of the U.S. Trustee in Weirton's case, HSBC substantially
contributed to Weirton's bankruptcy case, and is thus entitled to
payment for trustee fees and the fees and expenses of outside
counsel.

The Weirton Steel Corporation Liquidating Trustee disputes the
validity and amount of the HSBC Administrative Claim, and
question the extent to which HSBC is entitled to an
administrative claim for the services it has provided.

To resolve their dispute, the Liquidating Trustee and HSBC agree
that:

    (a) the HSBC Administrative Claim will be fixed and allowed
        against Weirton for $164,195, and will be given
        administrative priority status in accordance with the
        Confirmed Plan;

    (b) HSBC will forever release and discharge Weirton and the
        Trustee from any and all claims, past, present or future,
        for fees and expenses of HSBC on an administrative
        priority basis.  However, this will not release:

        -- any claims filed by HSBC, as an indenture trustee, in
           respect of the bond claims under the applicable
           indenture for which HSBC serves as indenture trustee;
           and

        -- the charging lien HSBC has vis-a-vis the distributions
           to bondholders for the unpaid amount, if any, of fees
           and expenses; and

    (c) Weirton and the Trustee will forever release and discharge
        HSBC from any and all claims, past, or future, related in
        any manner to Weirton's bankruptcy filing or to HSBC's
        role as indenture trustee under the applicable indenture.

The Liquidating Trustee asks the Court to approve the Settlement
Agreement with HSBC.

Mr. Freedlander assures the Court that the compromise is fair and
reasonable as it will permit the Trustee to expeditiously resolve
the Claim Dispute, which otherwise could substantially:

     -- delay the distribution process;

     -- increase costs associated with litigating the Claim
        dispute; and

     -- result in a substantial dilution of the distribution to
        creditors holding allowed claims, if HSBC was to prevail.

Headquartered in Weirton, West Virginia, Weirton Steel Corporation  
was a major integrated producer of flat rolled carbon steel with  
principal product lines consisting of tin mill products and sheet  
products.  The company was the second largest domestic producer of  
tin mill products with approximately 25% of the domestic market  
share.  The Company filed for chapter 11 protection on May 19,  
2003 (Bankr. N.D. W. Va. Case No. 03-01802).  Judge L. Edward  
Friend, II administers the Debtors cases.  Robert G. Sable, Esq.,  
Mark E. Freedlander, Esq., David I. Swan, Esq., James H. Joseph,  
Esq., at McGuireWoods LLP represent the Debtors in their  
liquidation.  Weirton sold substantially all of its assets to  
Wilbur Ross' International Steel Group.  (Weirton Bankruptcy News,
Issue No. 37; Bankruptcy Creditors' Service, Inc., 215/945-7000)


WINSTAR COMMS: Judge Farnan Affirms No Stay Relief for BAE Systems
------------------------------------------------------------------
The United States District Court for the District of Delaware
affirms the Bankruptcy Court's November 14, 2003 Order denying
BEA Systems, Inc.'s motion to lift the automatic stay to set-off
rights.

                            BEA's Appeal

As previously reported, BEA asked the Bankruptcy Court to lift
the stay to offset a sales tax refund that it received from the
Commonwealth of Virginia and owed to the Debtors against the
Debtors' prepetition debt owed to BEA.  The Debtors' prepetition
debt stems from an invoice sent by BEA to the Debtors for Support
Services pursuant to a three-year Software License Agreement
between the Debtors and BEA.  The Debtors never paid the invoice.

In addition, the Debtors maintained a prepetition claim against
BEA in connection with another sale of software and support
maintenance in which the Debtors paid a $350,438 sales tax to BEA
even though the Debtors were exempt from the Virginia sales tax.
BEA filed an amended tax return with the State of Virginia and
received a refund of the amount owed plus interest for a total of
$437,963.

BEA contends that the Bankruptcy Court erred in denying its
request to lift the stay and allow it to exercise its set-off
rights by holding that the debts did not satisfy the mutuality
requirement under Section 553 of the Bankruptcy Code because BEA
received and held the tax refund in an agency capacity and not
individually.

BEA further argues that several Virginia sales tax statutes and
the statutory scheme taken as a whole demonstrate that BEA can
either refund the sales tax to the purchaser or credit it to his
or her account, and therefore, the dealer or vendor has an
individual obligation vis-a-vis the purchaser.

                       The Trustee's Argument

Christine C. Shubert, the Chapter 7 Trustee overseeing the
liquidation of Winstar Communications, Inc.'s estate, contends
that the applicable Virginia tax law makes it clear that vendors
like BEA collect and refund tax as an agent for the State of
Virginia.  Pointing to additional sections of Virginia's tax code
and portions of Virginia's Administrative Code, the Trustee
contends that the purchaser must provide a certificate of tax
exemption to obtain a refund.  Moreover, a writing, indicating
the purchaser's willingness to await payment of the refund from
the vendor until Virginia issues the refund, is required.

The Trustee maintains that BEA was merely a conduit for the tax
refund in that it was acting as an agent of the Trustee and of
the State of Virginia for the purposes of obtaining the refund
and returning that refund to the Debtors, as customer.

                    The District Court's Ruling

After reviewing the arguments presented, District Court Judge
Farnan rules that the Bankruptcy Court correctly concluded that
there was no mutuality of obligation between the debt owed by BEA
to the Debtors by virtue of the overpaid taxes, and the claim by
BEA against the Debtors as a result of the software sale.

Judge Farnan agrees with Judge Rosenthal's conclusion that BEA
received the tax refund in an agency capacity and not in its
individual capacity.  As the Virginia Code and Administrative
Rulings demonstrate, BEA would have not been entitled to a refund
unless the Debtors, as purchaser of the goods for which the sales
tax was paid, executed a certificate of tax exemption and a
writing indicating its willingness to await payment of the refund
from the vendor until the refund was issued by the State of
Virginia.  In the District Court's view, it is the State of
Virginia who is the party that owes the refund to the customer,
and the vendor is merely a conduit or agent of the state through
which the refund passes to the customer.

Headquartered in New York, New York, Winstar Communications, Inc.,
provides broadband services to business customers.  The Company
and its debtor-affiliates filed for chapter 11 protection on April
18, 2001 (Bankr. D. Del. Case Nos. 01-01430 through 01-01462).  
The Debtors obtained the Court's approval converting their case to
a chapter 7 liquidation proceeding in January 2002.  Christine C.
Shubert serves as the Debtors' chapter 7 trustee.  When the
Debtors filed for bankruptcy, they listed $4,975,437,068 in total
assets and $4,994,467,530 in total debts.  (Winstar Bankruptcy
News, Issue No. 61; Bankruptcy Creditors' Service, Inc., 215/945-
7000)  


WORLDCOM INC: Court Approves Sprint Settlement Agreement
--------------------------------------------------------
Before WorldCom, Inc. and its debtor-affiliates filed for chapter
11 protection, the Debtors entered into several contracts and
arrangements with Sprint Communications Company, LP, and its
affiliates, where each party agreed to provide services and
furnish facilities to one another.  The contracts include:

   (a) various agreements and arrangements provided under tariffs
       and contracts pursuant to which each party has made access
       to the other's network and services, including Internet,
       general exchange, telephony, WATS, private lines, pay
       phone, wireless resale accounts, terminating access and
       switched access, available to the other; and

   (b) a billing and collection agreement pursuant to which
       Sprint purchased the Debtors' accounts receivable and
       provides billing services for the Debtors.

The Debtors assert that Sprint owes them $39 million for
prepetition services rendered in connection with the Agreements.  
Sprint disputes owing a portion of the MCI Claim.

Sprint has filed proofs of claim aggregating $300 million for
prepetition services rendered in connection with the Agreements
and the Debtors' rejection of certain of the Agreements.  Sprint
also asserts a right to setoff a portion of the MCI Claim against
a portion of the Sprint Claim.  The Debtors dispute owing a
portion of the Sprint Claim and deny that Sprint has a right to
offset a portion of the parties' debts.

On February 28, 2002, Sprint filed a lawsuit against the Debtors
in the United States District Court for the District of Kansas
seeking unspecified damages in connection with its dispute over
the Debtors' provision of wide area telecommunications services.

The Debtors and Sprint engaged in arm's-length discussions to
settle their dispute.  The parties subsequently agree that:

   (a) The Debtors will pay $26 million in cash to Sprint;

   (b) The Parties will set off $31 million of their own
       prepetition debts;

   (c) Sprint will have an allowed general unsecured prepetition
       claim in Class 6 of the Plan for $50 million, which claim
       will not be subject, in whole or in part, to disallowance
       or subordination;

   (d) The Settlement Agreement will not affect any obligations
       of the parties arising subsequent to the Petition Date;

   (e) The Debtors will be deemed to have assumed all of the
       Agreements, except those for which the Debtors have
       previously sought or obtained the Court's authority to
       reject;

   (f) The parties will effectuate general releases including
       the dismissal of the Sprint Lawsuit; and

   (g) The parties will implement certain commercial agreements.

At the Debtors' behest, the Court approves the Settlement
Agreement.

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


XOMA LTD: Sept. 30 Balance Sheet Upside-Down by $7.2 Million
------------------------------------------------------------
XOMA Ltd. (Nasdaq:XOMA), a biopharmaceutical development company,
announced results for the quarter ended September 30, 2004.

For the third quarter of 2004, the Company recorded a net loss of
$20.1 million, compared with $9.9 million for the third quarter of
2003. As of September 30, 2004, XOMA held $36.4 million in cash,
cash equivalents, and short-term investments, compared with $85.2
million at December 31, 2003. Short-term notes payable were $0.3
million at September 30, 2004, compared with $18.6 million at
December 31, 2003.

Recent accomplishments include:

   -- Serono, AG (virt-x: SEO and NYSE: SRA) received European
      Commission Marketing Authorisation for RAPTIVA(R), bringing
      the total number of countries in which RAPTIVA(R) is
      approved to more than 30.

   -- Serono has launched RAPTIVA(R) in Germany, UK, Denmark,
      Sweden, Switzerland, Australia, Argentina, Brazil and
      Mexico. Year-to-date RAPTIVA(R) sales in the United States
      by Genentech were $36.0 million through the third quarter.

   -- Triton BioSystems, Inc. has licensed XOMA's ING-1 antibody
      for cancer to use as a targeting molecule with its Targeted
      Nano-Therapeutics(TM) (TNT(TM)) System.

   -- XOMA re-structured its arrangement with Millennium
      Pharmaceuticals, Inc. (NASDAQ: MLNM) on MLN2222 to limit
      XOMA's participation in development through Phase I clinical
      testing, with Millennium assuming responsibility and
      development costs from then on. XOMA will continue to
      manufacture product at Millennium's request and cost and
      XOMA will be entitled to potential milestones based on the
      clinical and regulatory progress of the product and a
      royalty on sales.

   -- Aphton Corporation (NASDAQ: APHT) has signed a collaboration
      agreement with XOMA to develop treatments for
      gastrointestinal and other gastrin-sensitive cancers using
      anti-gastrin monoclonal antibodies.

"The recent EU marketing approval for RAPTIVA(R) brings a global
presence in over 30 countries with sales growing in the United
States and launches being implemented in different regions," said
John L. Castello, president, chairman and chief executive officer
of XOMA. "Our oncology strategy is bearing fruit in the form of
our active partnership with Chiron and our new antibody
collaboration with Aphton, as well as licensing our ING-1 product
to Triton. These agreements provide promising new sources of
product candidates to add to our development pipeline."

"Serono's RAPTIVA(R) marketing approvals in the European Union can
be an important step in putting RAPTIVA(R) on a profitable footing
for us," said Peter B. Davis, XOMA's vice president of finance and
chief financial officer. "We're also putting a heavy emphasis on
our business development efforts, not only to strengthen our
pipeline, but to improve our profitability by utilizing our
existing capabilities."

                             Revenues
  
Total revenues for the third quarter of 2004 were $0.6 million
compared with $12.6 million in the third quarter of 2003. Year-to-
date revenues of $1.5 million decreased from $18.2 million for the
prior year period. The 2003 revenues included license fees from
several bacterial cell expression technology license arrangements,
as well as revenue derived from agreements with Baxter Healthcare
Corporation and Onyx Pharmaceuticals, Inc. that have subsequently
been terminated. The Baxter termination fee of $10 million dollars
was also included in 2003 third quarter revenues.

In relation to the collaboration agreement between XOMA and Chiron
for oncology antibody therapeutics, the Company is recognizing the
$10 million upfront payment that it received as revenue over 60
months beginning with March of 2004.

                             Expenses

Research and development expenses for the quarter ended Sept. 30,
2004, decreased to $12.6 million from $16.6 million for the same
period in 2003. Spending increases on XOMA's XMP.629 topical acne
compound, the Chiron collaboration, new product research and the
TPO mimetic antibody program were more than offset by reduced
spending on the MLN2222 complement inhibitor product, RAPTIVA(R),
NEUPREX(R) and ING-1, as well as on the MLN2201 program, which was
discontinued in 2003.

General and administrative expenses for the three months ended
September 30, 2004, increased to $4.0 million from $3.6 million
for the three months ended September 30, 2003. The increase was
due to a number of factors, notably increasing business
development activities and strengthening of internal financial
systems and controls.

Collaboration arrangement expenses of $3.9 million in the quarter
ended September 30, 2004, represent profit and cost sharing
amounts from Genentech related to RAPTIVA(R). This compared with
$2.0 million in the three months ended September 30, 2003. The
2004 figure reflects sales and marketing costs for RAPTIVA(R) in
excess of gross profit. The 2003 amount reflects an R&D cost
sharing adjustment in XOMA's favor which was more than offset by
XOMA's share of pre-launch marketing expenses for RAPTIVA(R).

                Liquidity and Capital Resources

Net cash used in operating activities was $33.1 million for the
first nine months of 2004 compared with $36.3 million for the nine
months ended September 30, 2003. The lower cash usage in 2004
compared with 2003 reflected a higher net loss, which was more
than offset by $10 million received from Baxter related to
NEUPREX(R) and $10 million received from Chiron related to the
initiation of an exclusive collaboration for the development of
antibody products in oncology.

Based on current spending levels, anticipated revenues and partner
funding, XOMA estimates that it has sufficient cash resources to
meet its anticipated net cash consumption levels through
approximately the end of 2005. The company currently plans to
access additional sources of funding that it believes to be
available, including capital market financing, to meet its
anticipated net cash consumption levels longer term. Any
significant revenue shortfalls or increases in planned spending on
development programs could shorten this period. Additional
licensing arrangements or collaborations or otherwise entering
into new equity or other financing arrangements could extend this
period. Progress or setbacks by potentially competing products may
also affect XOMA's ability to secure new funding on acceptable
terms.

                      2004 Financial Outlook

XOMA expects to record higher losses in 2004 than in 2003,
primarily due to costs related to the RAPTIVA(R) sales launch and
the termination of two revenue-generating agreements in the second
half of 2003. The Company's strategy is to continue broadening its
pipeline through both internal development programs and additional
collaborations beyond its existing partnerships with Alexion
Pharmaceuticals, Inc., Aphton, Chiron, Genentech, and Millennium.

                       Product Highlights

Commercial Product: RAPTIVA(R) (Efalizumab)

RAPTIVA(R) is the first FDA-approved biologic therapy designed to
provide continuous control of chronic moderate-to-severe plaque
psoriasis in adults age 18 or older who are candidates for
systemic therapy or phototherapy. Patients can self-administer the
drug as a single, once-weekly subcutaneous injection after
training by a healthcare professional.

RAPTIVA(R) was developed in the U.S. through a partnership between
Genentech and XOMA and received FDA approval in October of 2003.
U.S. sales of RAPTIVA(R) through the third quarter of 2004 were
$36.0 million.

RAPTIVA(R) is licensed outside of the United States and Japan
through an agreement made with Serono in August of 2002. Serono
announced in September that it has received European Commission
Marketing Authorisation for RAPTIVA(R) to treat people with
moderate-to-severe chronic plaque psoriasis for whom other
systemic treatments or phototherapy have been inadequate or
inappropriate. RAPTIVA(R) is also approved in Switzerland and
Australia, as well as Argentina, Mexico and Brazil. Serono has
launched RAPTIVA(R) in Germany, UK, Denmark, Sweden, Switzerland,
Australia, Argentina, Brazil and Mexico.

XOMA and Genentech are continuing long-term clinical testing of
RAPTIVA(R) in psoriasis patients, and additional indications are
in pilot clinical studies.

XMP.629 for acne

Results from a Phase II randomized, double-blind, placebo-
controlled dose-ranging efficacy and safety study in 240 mild-to-
moderate acne patients undergoing 12 weeks of daily topical
administration of XMP.629 were inconclusive for efficacy with an
unexpectedly high response rate in the placebo group. The drug
appeared safe and well-tolerated in this study. Previous data from
several Phase I studies in healthy volunteers and acne patients,
suggested that the topical application of XMP.629 is safe, non-
irritating, and well tolerated.

The XMP.629 peptide, derived from human bactericidal/permeability-
increasing protein (BPI), targets bacteria associated with
inflammatory lesions in acne patients, including those resistant
to current antibiotic treatments. Several preclinical studies
showed the XMP.629 peptide to be a potent agent against
Propionibacterium acnes and related skin microorganisms associated
with acne, as well as demonstrating favorable topical properties.

XOMA has announced that pending a more complete analysis it does
not plan to initiate additional clinical trials with XMP.629.

Oncology Therapeutic Antibodies Program

In March of 2004, Chiron and XOMA announced an exclusive,
worldwide, multi-product collaboration to develop and
commercialize antibody products for the treatment of cancer. Under
this agreement, the companies will jointly research, develop, and
commercialize multiple antibody product candidates. The companies
share expenses and revenues, generally on a 70-30 basis, with
XOMA's share being 30 percent. Financial terms include initial
payments to XOMA totaling $10 million and a loan facility of up to
$50 million to fund up to 75 percent of XOMA's share of expenses
beginning in 2005.

In July, Chiron acquired Sagres Discovery, a privately held
discovery-stage company based in Davis, California, that
specializes in the discovery and validation of oncology targets.
Chiron has access to all of Sagres' proprietary oncology
technology. Further review of these targets could identify
additional antibody target candidates for the XOMA collaboration.

Also in July, XOMA announced that the first product candidate
under this collaboration is an anti-CD40 antibody targeting B-cell
malignancies. The companies intend to file an IND before year-end
2004 and to begin clinical testing in early 2005.

ING-1 Licensed to Triton

In October, 2004, Triton BioSystems and XOMA announced that Triton
has in-licensed the exclusive worldwide rights to commercially use
XOMA's proprietary anti-tumor ING-1 monoclonal antibody with
Triton's Targeted Nano-Therapeutics(TM) (TNT(TM)) System. The
TNT(TM) System ablates tumors by using tiny magnetic spheres
delivered systemically with antibodies. The tiny spheres within
the tumors are induced to heat by a localized externally applied
magnetic field. ING-1, a Human Engineered(TM) monoclonal antibody
with high affinity to the Ep-CAM antigen, is expressed in high
concentrations on many adenocarcinoma tumor cells. The combination
of the ING-1 antibody with the TNT(TM) System is intended to
create a novel, highly selective, safe, and effective treatment
for adenocarcinomas, such as breast, colorectal, lung, ovary and
prostate.

TPO Mimetic Collaboration with Alexion

In November 2004, XOMA and Alexion determined that the lead
molecule in their TPO mimetic collaboration did not meet the
criteria established in the program for continued development. The
companies are evaluating next steps for the collaboration,
including a potential alternative TPO mimetic compound for
development.

Anti-Gastrin Antibody Collaboration with Aphton

In September 2004, Aphton Corporation and XOMA announced a
worldwide collaboration to develop treatments for gastrointestinal
(GI) and other gastrin-sensitive cancers using anti-gastrin
monoclonal antibodies. Under the terms of the agreement, Aphton
and XOMA will share all development expenses and all
commercialization profits and losses for all product candidates on
a 70/30 basis, respectively. XOMA will have worldwide
manufacturing rights for these products and the ability to share
up to 30% in the commercialization efforts in the United States.
Aphton will share U.S. commercialization rights and will have
exclusive rights to commercialize all products outside the United
States. Antibodies to be developed under the collaboration will
bind and neutralize the hormones gastrin 17 and gly-gastrin 17 (a
gastrin precursor) that are known to be involved in tumor
progression in GI cancers. Gastrin expression and the appearance
of gastrin receptors have been associated with increasing
malignant characteristics of GI tumors and with poorer prognostic
outcomes. Specifically, gastrin is known to be involved in the
progression of colorectal, stomach, liver and pancreatic cancers
and inhibiting gastrin may inhibit such growth.

                        About the Company

XOMA is focused on the development and commercialization of
antibody and other protein-based biopharmaceuticals for disease
targets that include cancer, immunological and inflammatory
disorders, and infectious diseases. XOMA's proprietary and
collaborative product development programs include: RAPTIVA(R) for
moderate to severe plaque psoriasis (marketed) and other
indications in collaboration with Genentech, Inc.; MLN 2222, a
recombinant protein for reducing the incidence of post-operative
events in coronary artery bypass graft surgery patients with
Millennium Pharmaceuticals, Inc. (Phase I); CHIR-12.12, an anti-
CD40 antibody for treating B-cell tumors and additional product
candidates in connection with an antibody oncology collaboration
with Chiron Corporation (preclinical); a TPO mimetic antibody to
treat chemotherapy-induced thrombocytopenia in collaboration with
Alexion Pharmaceuticals, Inc. (preclinical); and anti-gastrin
antibody product candidates in conjunction with the antibody
collaboration for the treatment of gastrointestinal cancers with
Aphton Corporation (preclinical). XOMA's proprietary
bactericidal/permeability-increasing protein (BPI)-derived
programs include NEUPREX(R), in a Phase I/II study to limit
complications following pediatric cardiopulmonary bypass surgery.
For more information about XOMA's product pipeline and antibody
product development capabilities and technologies, please visit
XOMA's website at http://www.xoma.com/

At Sept. 30, 2004, XOMA Ltd.'s balance sheet showed a $7,172,000
stockholders' deficit, compared to a $48,214,000 of positive
equity at Dec. 31, 2003.


* Sullivan & Worcester Expands Technology Practice with 4 Lawyers
-----------------------------------------------------------------
Sullivan & Worcester LLP said four veteran lawyers will join its
Technology Practice Group, as the firm continues to expand its
capabilities in serving venture capital funds and emerging
companies in the high tech and life sciences sectors.

The four lawyers, Alfred L. Browne III, Edwin L. Miller, Jr., Dr.
Diana M. Steel, and Miguel J. Vega, have deep experience
representing high-tech, venture capital and life sciences clients
across a wide range of activities, including private and public
financings, initial public offerings, mergers and acquisitions,
private equity fund formations, licensing and the protection of
intellectual property.

Mr. Brown, Mr. Miller and Mr. Vega are joining the firm as
partners and Dr. Steel joins as counsel. They join another recent
arrival to the firm, Richard S. Sanders, who is a partner and
chair of the Technology Litigation Practice. All formerly
practiced together at Boston's Testa, Hurwitz & Thibeault.

"The addition of Al, Ed, Miguel and Diana to our Technology
Practice Group enables us to offer our venture capital and
emerging company clients enhanced capabilities and a broader
experience base, particularly in those industry sectors propelling
the Massachusetts economy," said William J. Curry, S&W's co-
managing partner. " We expect to continue to grow this practice
group."

Mr. Miller said, "Sullivan & Worcester is an exciting, growing
firm where we will have first-rate support from a wide range of
highly respected practice groups." He said the four were also
drawn to S&W by its reputation as a mid-size firm where lawyers
practice at the highest level in an environment that focuses on
efficient client service.

"We get the most satisfaction from working directly with our
clients and helping them solve their problems,' Miller said. "The
Sullivan & Worcester model emphasizes close partner-client contact
with support from small teams. This model enables us to give our
clients the highest quality and most cost-effective services."

The four new attorneys bring the number of partners and counsel
S&W has hired during the last eight months to 21, as the firm has
expanded practice areas in Boston and its offices in New York and
Washington. Many of the new lawyers came from larger firms,
attracted to a mid-size law firm model that offers the best of
both worlds: the quality of a big firm with the hands-on client
relationships more typically found at boutiques.

            New Attorneys in the Technology Practice Group

Alfred L. Browne III

Prior to joining the firm, Alfred Browne was a founding partner at
Browne, Rosedale, & Lanouette LLP, where he primarily focused on
the representation of clients in corporate finance and securities,
intellectual property and licensing of technology, mergers and
acquisitions, and venture capital. He also served as Vice
President, General Counsel and Corporate Secretary at Informio,
Inc. where he was a member of the senior management team
responsible for all legal matters relating to the operation of the
business. Prior to that, Browne was Associate Corporate Counsel
for CMGI where he represented the company in various corporate
acquisitions, financings, and internet-related transactions.
Browne began his legal career as an associate in the Business
Practice Group at Testa, Hurwitz & Thibeault where he counseled
high technology, venture capital, manufacturing, and health care
clients in areas involving corporate financing, mergers and
acquisitions, licensing of technology, and venture capital fund
formations.

Edwin L. Miller, Jr.

Edwin Miller has practiced corporate and securities law for over
30 years. He has represented clients in billions of dollars of
public offerings and dozens of other public market transactions
since the 1970s. He began his legal career in 1973 as the first
associate at Boston's Testa, Hurwitz & Thibeault and was a partner
in that firm for over 20 years. He has organized a number of
private equity/venture capital funds and has represented venture
capital firms and technology firms in venture financings
throughout his time in practice. More recently, he has
concentrated on the representation of emerging technology
companies in their financing, technology transfer, and acquisition
activities. He has published extensively in the field of
technology law, including a five-volume book series called "The
Lifecycle of a Technology Company."

Dr. Diana M. Steel

Diana Steel's practice includes the strategic preparation,
prosecution and analysis of patent portfolios that protect
clients' business objectives in both the United States and abroad
for industrial, academic, health care, and venture clients. Her
experience includes due diligence analyses and risk assessment of
patent portfolios, freedom to operate studies, and litigation
support. Steel has extensive expertise in life sciences, including
all areas of cell biology, immunology, developmental biology,
molecular biology, genetics and medical devices. Steel joins S&W
from Testa, Hurwitz, & Thibeault where she practiced intellectual
property law. She holds a doctorate in pathology from the
University of Oxford.

Miguel J. Vega

Miguel Vega represents companies at all stages of development from
start-ups to public companies, and their sources of capital. He
has represented large multinational and small emerging growth
companies in mergers and acquisitions, IPOs, secondary public
offerings, technology transfers and licensing, and SEC compliance.
He has also advised many venture capital funds in their formation
and compliance, as well as in their venture investments and
buyouts of other funds. Vega represents companies in the United
States, Europe and India that operate in a variety of industries
including software, telecommunications, information services, and
life sciences. Vega was a partner in the Business Practice Group
at Testa, Hurwitz & Thibeault, where he practiced for over 10
years.

Richard S. Sanders

Richard Sanders joined the Litigation Practice Group at S&W in
March 2004. He is the Chair of the Technology Litigation Practice
Group and specializes in all areas of intellectual property and
commercial litigation, including patent and trade secret
litigation, non-competition litigation, inventorship and licensing
disputes, and other complex litigation and dispute resolution.
Before joining S&W, Sanders was a partner in the Litigation and
Intellectual Property Litigation Practice Groups at Testa, Hurwitz
& Thibeault.

                  About Sullivan & Worcester LLP

Sullivan & Worcester LLP provides its domestic and international
clients with expert, focused and efficient legal counsel. With
more than 180 attorneys in Boston, New York and Washington, D.C.,
the firm offers comprehensive legal services in corporate finance,
securities, venture capital and private equity, mergers and
acquisitions, trade finance, litigation, tax, real estate,
banking, bankruptcy, and employment and benefits. The firm also
has deep expertise in the areas of energy, regulatory law and
REITs, and provides extensive legal counsel to companies and
advisers in the investment industry. For more information, please
visit http://www.sandw.com/

                          *********

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.

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