TCR_Public/050106.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, January 6, 2005, Vol. 9, No. 4

                          Headlines

ADELPHIA COMMS: Has Until March 14 to Make Lease-Related Decisions
ALASKA COMMS: Plans to Refinance Debt with Equity Offering
ALOHA AIRGROUP: Taps Gelber Ingersoll as Bankruptcy Counsel
ALOHA AIRGROUP: Look for Bankruptcy Schedules by Mar. 15
ANECO ELECTRICAL: Case Summary & 20 Largest Unsecured Creditors

ANECO ELECTRICAL: Wants to Retain Stichter Riedel as Counsel
ANECO ELECTRICAL: Section 341(a) Meeting Slated for Feb. 4
APEX PLUMBING: Case Summary & 20 Largest Unsecured Creditors
ARTIFICIAL LIFE: Accelera Ventures Discloses 7.37% Equity Stake
ATA AIRLINES: Sec. 341 Meeting of Creditors Continued to Jan. 11

AVITAR INC: Losses & Deficits Trigger Going Concern Doubt
BEDROCK BOWLING LLC: Case Summary & 6 Largest Unsecured Creditors
CITATION CORP: Needs Until Jan. 28 to File a Chapter 11 Plan
CITATION CORP: Miller Buckfire Approved as Financial Advisor
CLARK GROUP: Charles W. Riske Approved as Liquidating Trustee

CURATIVE HEALTH: Inks Settlement Pact with Calif. Health Services
DEVLIEG BULLARD: Court Converts Case to Chapter 7 Proceeding
DOMTAR INC: Restructures Northeastern Ontario Sawmill Operations
DONNKENNY, INC.: CIT Credit Agreement in Default at Dec. 31
DPL CAPITAL: S&P Affirms B Ratings on Six Security Classes

FALCON PRODUCTS: Expects Inventory Write-Down of $20 Million Up
FRANKLIN CAPITAL: Asks Stockholders to Okay 2-for-1 Stock Split
FRIEDMAN'S INC: In Talks with Lenders to Amend Financial Covenants
GLEN CARTER EXCAVATING: Voluntary Chapter 11 Case Summary
HAPPY KIDS INC: Case Summary & 30 Largest Unsecured Creditors

INTEGRATED HEALTH: Briarwood Wants Stock Purchase Deal Completed
INTERSTATE GENERAL: Continuing Losses Prompt PCXE to Halt Trading
INT'L. FABRICATORS: Case Summary & 20 Largest Unsecured Creditors
LOEWEN GROUP: State Street Wants $224,705 Class 23 Claims Paid
LSI LOGIC: Raises 2004 Fourth Quarter Revenue & EPS Guidance

MANUFACTURED HOUSING: S&P's Rating on Class B-1 Debt Slides to D
MATRIA HEALTHCARE: Adopted Holding Company Structure on Dec. 31
MIRANT: Seeks Tolling Pacts for Two California Generating Units
MOOG INC: S&P Rates Proposed $120 Million Senior Sub. Notes at B+
NATIONAL CENTURY: Trust Objects to R. Parrett's $110 Mil. Claims

NEXTEL PARTNERS: Welcomes Art Harrigan to Board of Directors
NOTIFY TECHNOLOGY: Losses & Deficit Triggers Going Concern Doubt
NQL DRILLING: Appoints Pat Shouldice to Board of Directors
NRG ENERGY: Agrees to Settle Con Edison Claims for $5.8 Million
PAW INVESTMENTS: Voluntary Chapter 11 Case Summary

PEGASUS SATELLITE: Wants to Abandon Unsold Assets to Lenexa
PENN TRAFFIC: Names Robert Dimond VP & Chief Financial Officer
PRUDENTIAL SECURITIES: Moody's Rates Four Cert. Classes at Low-B
PSYCHIATRIC SOLUTIONS: S&P Revises Ratings Outlook to Stable
QUIGLEY COMPANY: Caplin & Drysdale Approved as Committee Counsel

RAYOVAC CORP: S&P Places Low-B Ratings on CreditWatch Negative
REI TRUST: Fitch Withdraws 'BB+' Rating on $375 Mil. 7.20% Trust
RELIANCE GROUP: Settles $2.8 Million Wrongful Death Action Claims
RITE AID: Offering $200 Million Senior Notes to Repay 2015 Notes
ROCKY MOUNTAIN: Receiver Initiates Distribution of Funds

SATCON TECHNOLOGY: Auditors Raise Going Concern Doubts
SENECA GAMING: S&P Revises Outlook on Low-B Ratings to Negative
SPIEGEL INC: Court Approves MBIA & BNY Claims Settlement
STELCO INC: Binding Offers Due by January 31, 2005
TEMBEC INC: Restructuring Five Sawmills in Northeastern Ontario

TEMBEC INC: Moody's Pares Ratings to B2 & Says Outlook is Stable
TEV INVESTMENT: List of its 11 Largest Unsecured Creditors
TORPEDO SPORTS: Symbol Returns to TPDO Following Filing of Reports
TOWER AUTOMOTIVE: Closes New $50 Million Securitization Facility
TUCSON ELECTRIC: Fitch Affirms Low-B Bond Ratings

UAL CORPORATION: Taps Pachulski Stang to Pursue Preference Actions
US AIRWAYS: 64% of Attendants Ratify $94 Million Cost-Savings Pact
US AIRWAYS: Creditors Committee Retains Giuliani Capital
W.R. GRACE: Asbestos PD Committee Objects to Disclosure Statement
W.R. GRACE: Future Representative Says Plan is Unconfirmable

WACHOVIA BANK: S&P Places Low-B Ratings on Six Certificate Classes
WARNER CHILCOTT: Moody's Junks $750M Senior Subordinated Notes
WARNER CHILCOTT: S&P Rates Proposed $1.64B Sr. Sec. Debt at B

* ABA Bench & Bar Bankruptcy Conference is in March in Washington
* Bob Iommazzo Joins NachmanHaysBrownstein as Managing Director
* Dewey Ballantine Elects Five Local Partners in European Offices
* Ropes & Gray Completes Merger to Create Largest IP Group

                          *********

ADELPHIA COMMS: Has Until March 14 to Make Lease-Related Decisions
------------------------------------------------------------------
Judge Gerber of the U.S. Bankruptcy Court for the Southern
District of New York granted Adelphia Communications Corporation
and its debtor-affiliates and extension of their time to elect to
assume, assume and assign or reject unexpired leases and executory
contracts.  The extension runs through March 14, 2005.

The Court makes it clear that if the Debtors will seek to reject
that certain lease with Steamtown Mall Partners, LP, governing the
premises located at the Mall at Steamtown in Scranton,
Pennsylvania, at any time between September 7, 2004, and
January 31, 2005, the effective date of the rejection will be no
earlier than January 31, 2005.

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.  (Adelphia Bankruptcy News, Issue
No. 76; Bankruptcy Creditors' Service, Inc., 215/945-7000)


ALASKA COMMS: Plans to Refinance Debt with Equity Offering
----------------------------------------------------------
Alaska Communications Systems Group, Inc. (NASDAQ: ALSK) disclosed
plans for a $75 million common stock offering of primary shares
and for a new senior secured credit facility.  The proposed senior
credit facility is expected to consist of a $50 million revolving
credit facility and a $335 million term loan facility.  The
company plans to use the net proceeds from the proposed equity
offering and borrowings under the senior credit facility to
finance a portion of the proposed repayment of its existing senior
secured credit facility and the proposed repurchase of all of its
outstanding 9-3/8% senior subordinated notes due 2009 and
approximately 35 percent of its outstanding 9-7/8% senior notes
due 2011.

The shares of common stock will be offered under the registration
statement on Form S-3 that the company filed on Dec. 20, 2004,
with the Securities and Exchange Commission.  It is currently
expected that the offering will be made before the end of January
2005.  A prospectus supplement will be filed with the SEC
containing specific information about the terms of the proposed
equity offering.

The completion of any equity offering, senior credit facility and
refinancing will be subject to a number of conditions, including
market conditions.  As a result, there can be no assurance as to
the terms or size of any equity offering, senior credit facility
or refinancing or that an equity offering, senior credit facility
and refinancing in fact will be completed.

A registration statement relating to the common stock has been
filed with the SEC but has not yet become effective.  The common
stock may not be sold nor may offers to buy be accepted prior to
the time the registration statement becomes effective.  This press
release shall not constitute an offer to sell or the solicitation
of an offer to buy nor shall there be any sale of the common stock
in any State in which such offer, solicitation or sale would be
unlawful prior to registration or qualification under the
securities laws of any such State.

               About Alaska Communications Systems

ACS is the leading integrated communications provider in Alaska,
offering local telephone service, wireless, long distance, data,
and Internet services to business and residential customers
throughout Alaska.

                          *     *     *

As reported in the Troubled Company Reporter on Nov. 05, 2004,
Standard & Poor's Ratings Services affirmed its ratings on Alaska
Communications Systems Group Inc. and subsidiaries, including the
'B+' corporate credit rating.  All ratings were removed from
CreditWatch, where they were placed with negative implications
June 8, 2004, due to concern about higher financial risk
accompanying the company's proposed $400 million income deposit
securities -- IDS -- offering.  The outlook is negative.

At the same time, Standard & Poor's assigned its '1' recovery
rating to Alaska Communications' existing $250 million senior
secured credit facility.  The existing 'BB-' bank loan rating on
the facility and the '1' recovery rating indicate a high
expectation of full recovery of principal in the event of a
payment default or bankruptcy.

The affirmation and removal from CreditWatch follow Alaska
Communications' withdrawal of its IDS transaction and the
company's initiation of a $0.185 per share quarterly dividend.
The dividend will total about $22.6 million annually and will be
lower than the previously proposed dividend associated with the
IDS.  Alaska Communications will not be using cash to make an
initial lump sum payment to shareholders, which was the company's
plan under the IDS transaction.

"Ratings reflect an aggressive shareholder-oriented financial
policy, financial risk from acquisition and capital spending-
related debt, and competitive pressure within the narrow and slow-
growth Alaska telecommunications market," said Standard & Poor's
credit analyst Eric Geil.  Stagnant EBITDA, elevated capital
expenditure needs, and a substantial dividend commitment will
likely hamper near- to medium-term financial improvement
potential.  The dividend could also constrain investment spending
needed to maintain competitiveness.  These factors are partly
tempered by the company's positions as the leading incumbent local
exchange carrier -- ILEC -- in Alaska and the second-largest
wireless provider in the state, as well as a degree of near-term
financial cushion from an $80 million cash balance.


ALOHA AIRGROUP: Taps Gelber Ingersoll as Bankruptcy Counsel
-----------------------------------------------------------
Aloha Airgroup, Inc., and its debtor-affiliates seek authority
from the U.S. Bankruptcy Court for the District of Hawaii to
employ Gelber, Gelber, Ingersoll & Klevansky as their bankruptcy
counsel.

Gelber, Gelber Ingersoll will perform all the necessary services
related to the Debtors' chapter 11 cases.

The Firm did not disclose to the Court the current billing rates
of its professionals.

Don Jeffrey Gelber, Esq., director and president of Gelber Gelber
Ingersoll, assures the Court of his Firm's "disinterestedness" as
that term is defined in Section 101(14) of the Bankruptcy Code.

Headquartered in Honolulu, Hawaii, Aloha Airgroup, Inc. --
http://alohaairlines.com/-- provides air carrier service
connecting five major airports in the State of Hawaii.  The
Company and its debtor-affiliate Aloha Airlines, Inc., filed for
chapter 11 protection on Dec. 30, 2004(Bankr. D. Hawaii Case Nos.
04-03063 to 04-03064).  When the Debtor filed for protection from
its creditors, it listed more than $50 million in assets and
debts.


ALOHA AIRGROUP: Look for Bankruptcy Schedules by Mar. 15
--------------------------------------------------------
Aloha Airgroup, Inc., and its debtor-affiliate ask the U.S.
Bankruptcy Court for the District of Hawaii for an extension until
Mar. 15, 2005, to file their schedules of assets and liabilities
and statements of financial affairs.

The Debtors explain that due to the size and complexity of their
operations, they need more time to gather the necessary
information to accurately prepare and file their schedules and
statements.

Headquartered in Honolulu, Hawaii, Aloha Airgroup, Inc. --
http://alohaairlines.com/-- provides air carrier service
connecting five major airports in the State of Hawaii.  The
Company and its debtor-affiliate Aloha Airlines, Inc., filed for
chapter 11 protection on Dec. 30, 2004(Bankr. D. Hawaii Case Nos.
04-03063 to 04-03064).  Alika L. Piper, Esq., Don Jeffrey Gelber,
Esq., Simon Klevansky, Esq., at Gelber Gelber Ingersoll &
Klevansky represent the Debtors in their restructuring efforts.
When the Debtor filed for protection from its creditors, it listed
more than $50 million in assets and debts.


ANECO ELECTRICAL: Case Summary & 20 Largest Unsecured Creditors
---------------------------------------------------------------
Debtor: Aneco Electrical Construction, Inc.
        601 Cleveland Street, Suite 600
        Clearwater, Florida 33755

Bankruptcy Case No.: 04-24883

Type of Business: The Debtor is an electrical and
                  telecommunications company serving the
                  commercial, entertainment, industrial, medical,
                  government and institutional building markets
                  in the southeastern United States.
                  See http://www.anecoinc.com/

Chapter 11 Petition Date: December 30, 2004

Court: Middle District of Florida (Tampa)

Judge: Paul M. Glenn

Debtor's Counsel: Scott A. Stichter, Esq.
                  Stichter, Riedel, Blain & Prosser
                  110 East Madison Street, Suite 200
                  Tampa, FL 33602
                  Tel: 813-229-0144
                  Fax: 813-229-1811

Estimated Assets: $10 Million to $50 Million

Estimated Debts:  $10 Million to $50 Million

Debtor's 20 Largest Unsecured Creditors:

   Entity                              Claim Amount
   ------                              ------------
General Electric Supply Co.                $808,830
P.O. Box 100275
Atlanta, GA 30384

Electric Supply of Tampa                   $773,910
P.O. Box 151657
Tampa, FL 33684

Zurich North America                       $604,823
8734 Paysphere Circle
Chicago, IL 60674

Mayer Electric                             $530,195
P.O. Box 1328
Birmingham, AL 35201

Marsh USA, Inc.                            $497,106
P.O. Box 198587
Atlanta, GA 30384

Colonial Electric                          $437,668
P.O. Box 8500
Philadelphia, PA 19178

Simplex Grinnell LP                        $326,715
Dept. CH 10320
Palatine, IL 60055

Pro Force Staffing, Inc.                   $323,261
Pearce Financial Group, Inc.
P.O. Box 60479
Charlotte, NC 28260

Hughes Supply, Inc.                        $305,510
P.O. Box 101888
Atlanta, GA 30392

Dominion Electric Supply Co.               $281,818
5053 Lee Highway
Arlington, VA 22207

Communications Supply Corp.                $207,363

Maddux Supply Company                      $202,952

SunTech Systems, Inc.                      $186,041

Graybar Electric Co., Inc.                 $173,610

McNaughton-McKay Elec. Co.                 $172,086

NDR Corporation                            $151,913

Atlantic Personnel Service, Inc.           $147,123

Cornatzer & Associates                     $132,540

Tradesman International                    $119,493

B&S Electric Supply Co., Inc.              $118,600


ANECO ELECTRICAL: Wants to Retain Stichter Riedel as Counsel
------------------------------------------------------------
Aneco Electrical Construction, Inc., asks the U.S. Bankruptcy
Court for the Middle District of Florida, Tampa Division, for
permission to employ Stichter, Riedel, Blain & Prosser, P.A., as
its counsel in this bankruptcy proceeding.

The Debtor believes that Stichter Rieder is well qualified to
represent it because of the Firm's considerable experience in
bankruptcy and debtor-creditor law.

Stichter Riedel will:

     a) render legal advice with respect to the Debtor's powers
        and duties as a debtor in possession, the continued
        operation of the Debtor's business, and the management
        of its property;

     b) prepare on behalf of the Debtor necessary motions,
        applications, orders, reports, pleadings, and other
        legal papers;

     c) appear before this Court, any appellate courts, and the
        United States Trustee to represent and protect the
        interests of the Debtor;

     d) take all necessary legal steps to confirm a plan a plan
        of reorganization;

     e) represent the Debtor in all adversary proceedings,
        contested matters, and matters involving administration
        of this case, both in federal and in state courts;

     f) represent the Debtor in negotiations with potential
        financing sources and preparing contracts, security
        instruments, or other documents necessary to obtain
        financing; and

     g) perform all other legal services that may be necessary
        for the proper preservation and administration of this
        chapter 11 case.

Scott A. Stichter, Esq., at Stichter Riedel, will be the lead
attorney in this case.  Mr. Stichter discloses that the Debtor
paid his Firm a $110,000 retainer.

Stichter Riedel did not disclose the hourly rates of its
professionals.

To the best of the Debtor's knowledge, Stichter Riedel is a
"disinterested person" as that term is defined in Section 101(14)
of the Bankruptcy Code.

Headquartered in Clearwater, Florida, Aneco Electrical
Construction, Inc. -- http://www.anecoinc.com/-- is an electrical
and telecommunications company serving the commercial,
entertainment, industrial, medical, government and institutional
building markets in the southeastern United States.  The Company
filed for chapter 11 protection on Dec. 30, 2004(Bankr. M.D. Fla.
Case No. 04-24883).  When the Debtor filed for protection from its
creditors, it listed more than $50 million in estimated assets and
debts.


ANECO ELECTRICAL: Section 341(a) Meeting Slated for Feb. 4
----------------------------------------------------------
The United States Trustee for region 21 will convene a meeting of
Aneco Electrical Construction, Inc.'s creditors at 1:30 p.m., on
Feb. 4, 2005, at 501 East Polk Street, Timberlake Annex, Room
100-B in Tampa, Florida.  This is the first meeting of creditors
required under 11 U.S.C. Sec. 341(a) in all bankruptcy cases.

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

Headquartered in Clearwater, Florida, Aneco Electrical
Construction, Inc. -- http://www.anecoinc.com/-- is an electrical
and telecommunications company serving the commercial,
entertainment, industrial, medical, government and institutional
building markets in the southeastern United States.  The Company
filed for chapter 11 protection on Dec. 30, 2004(Bankr. M.D. Fla.
Case No. 04-24883).  Scott A. Stichter, Esq., at Stichter, Riedel,
Blain & Prosser represents the Debtor in its restructuring
efforts.  When the Debtor filed for protection from its creditors,
it listed more than $50 million in estimated assets and debts.


APEX PLUMBING: Case Summary & 20 Largest Unsecured Creditors
------------------------------------------------------------
Debtor: Apex Plumbing, LLC
        3240-A Corporate Court
        Ellicott City, Maryland 21042

Bankruptcy Case No.: 04-39171

Type of Business: The Debtor is a plumbing contractor.

Chapter 11 Petition Date: December 31, 2004

Court: District of Maryland (Baltimore)

Judge: E. Stephen Derby

Debtor's Counsel: Constance M. Hare, Esq.
                  Mehlman, Greenblatt & Hare, LLC
                  723 South Charles Street, Suite LL3
                  Baltimore, MD 21230
                  Tel: 410-547-0300
                  Fax: 410-547-7474

Estimated Assets: $0 to $50,000

Estimated Debts:  $1 Million to $10 Million

Debtor's 20 Largest Unsecured Creditors:

   Entity                     Nature Of Claim       Claim Amount
   ------                     ---------------       ------------
United States Treasury        Withholding taxes         $519,971
Internal Revenue Service
P.O. Box 8313
Philadelphia, PA 19162

Northeastern Supply                                     $394,577
P.O. Box 6300209
Baltimore, MD 21263

NAS Surety Group                                        $227,748
1200 Arlington Heights Road
Suite 400
Itasca, IL 60143

FEI- Beltsville                                         $120,000

Comptroller of Maryland       Withholding taxes          $90,189

Thomas Somerville-MD                                     $88,942

Stout, Causey & Horning P.A.                             $53,635

Thomas and Kalichman                                     $29,961

Jose Antonio Zuniga                                      $27,377

Zurich North America                                     $23,294

Roth Staffing Companies                                  $16,404

Jose Landaverde                                          $16,396

Raul Reyes                                               $15,051

Jose Pacheco                                             $14,262

Jonathan V. Ramos                                        $13,883

Thornton & Harwell Ins.                                  $12,920
Agency

Jevenal Arellano                                         $12,809

Balbino Rodriguez                                        $12,006

Wright Express Corporation                               $11,668

The Home Depot                                           $11,143


ARTIFICIAL LIFE: Accelera Ventures Discloses 7.37% Equity Stake
---------------------------------------------------------------
Accelera Ventures Limited, of the British Virgin Islands,
beneficially owns 1,050,000 shares of the common stock of
Artificial Life, Inc., representing 7.37% of the outstanding
common stock of the Company.  The principal business office of
Accelera Ventures Limited is on the 14th Floor, Suite 1408,
Harcourt House, 39 Gloucester Road, Wanchai, Hong Kong.

                        About the Company

Artifical Life, Inc. -- http://artificial-life.com/-- develops
and sells a wide range of products and custom applications for the
Internet and mobile devices.

                       Going Concern Doubt

In its Form 10-QSB for the quarterly period ended Sept. 30, 2004,
filed with the Securities and Exchange Commission, Artificial
Life's independent registered public accountants raised
substantial doubt about the Company's ability to continue as a
going concern.  The Company said its accumulated losses have
severely impacted its liquidity and cash position which, in turn,
have significantly impeded its ability to fund our operations in
the past.

At Sept. 30, 2004, Artificial Life's balance sheet showed a
$1,977,437 stockholders' deficit.


ATA AIRLINES: Sec. 341 Meeting of Creditors Continued to Jan. 11
----------------------------------------------------------------
Terry E. Hall, Esq., at Baker & Daniels, notifies the United
States Bankruptcy Court for the Southern District of Indiana that
the Meeting of Creditors pursuant to Section 341(a) of the
Bankruptcy Code has been continued to January 11, 2005 at 10:30
a.m.  The meeting will be held at the office of Baker & Daniels
located at 300 N. Meridian Street, 27th Floor, in Indianapolis,
Indiana.

As specified in Rule 9001(5) of the Federal Rules of Bankruptcy
Procedure, Ms. Hall says, ATA Airlines and its debtor-affiliates'
representative is required to appear at the meeting for the
purpose of being examined under oath.  Attendance by creditors is
permitted but not required.

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


AVITAR INC: Losses & Deficits Trigger Going Concern Doubt
---------------------------------------------------------
Avitar, Inc., had a net loss of $2,968,760 for Fiscal 2004
compared to a net loss of $6,462,101 for Fiscal 2003.  At
September 30, 2004, the Company had a working capital deficiency
of $388,972 and cash and cash equivalents of $508,876.  Net cash
used in operating activities during Fiscal 2004 amounted to
$3,595,361, resulting primarily from:

   -- a net loss of $2,968,760, an increase in accounts receivable
      of $118,176,

   -- an increase in inventories of $98,925,

   -- an increase in prepaid expenses and other current assets of
      $46,199,

   -- a decrease in accounts payable and accrued expenses of
      $884,309, and

   -- a decrease in deferred income of $20,250;

offset in part by:

   -- a loss from the disposal of is continued operation of
      $17,235,

   -- depreciation and amortization of $116,230,

   -- amortization of debt discount and deferred rent expense of
      $225,850,

   -- common stock and warrants issued for interest on short-term
      and long-term debt of $114,236,

   -- a loss on the extinguishment of long-term debt of $66,000,
      and

   -- a decrease in other assets of $1,707.

Net cash provided by financing and investing activities during
Fiscal 2004 was $2,973,318, which included proceeds from the sale
of preferred stock, common stock and warrants of $2,800,406 and
proceeds from the sale of United States Drug Testing Laboratories
of $500,000; offset in part by repayment of short-term debt of
$140,233, repayment of long-term debt of $11,279, payment of
preferred stock dividend of $16,110 and purchases of property and
equipment of $159,466.

During FY 2005, the Company's cash requirements are expected to
include primarily the funding of operating losses, the payment of
outstanding accounts payable, the repayment of certain notes
payable, the funding of operating capital to grow the Company's
drugs of abuse testing products and services, and the continued
funding for the development of its ORALscreen product line.

                      Going Concern Doubt

As a result of the Company's recurring losses from operations and
working capital deficit, the report of its independent registered
public accounting firm relating to the financial statements for
Fiscal 2004 contains an explanatory paragraph expressing
substantial doubt about the Company's ability to continue as a
going concern.  Such report states that the ultimate outcome of
this matter could not be determined as of the date of such report
(December 17, 2004).

Avitar, Inc., through its wholly owned subsidiary Avitar
Technologies, Inc. -- ATI, develops, manufactures, markets and
sells diagnostic test products and proprietary hydrophilic
polyurethane foam disposables fabricated for medical, diagnostics,
dental and consumer use.  During the fiscal year ended
September 30, 2004, the Company continued the development and
marketing of innovative point of care oral fluid drugs of abuse
tests, which use the Company's foam as the means for collecting
the oral fluid sample.  Through its wholly-owned subsidiary, BJR
Security, Inc., the Company provides specialized contraband
detection and education services.  On December 16, 2003, the
Company sold the business and net assets, excluding cash, of its
wholly owned-subsidiary, United States Drug Testing Laboratories,
Inc., which operated a certified laboratory and provided
specialized drug testing services primarily utilizing hair and
meconium as the samples.


BEDROCK BOWLING LLC: Case Summary & 6 Largest Unsecured Creditors
-----------------------------------------------------------------
Debtor: Bedrock Bowling, LLC
        3207 Forest Lane
        Dallas, Texas 75032

Bankruptcy Case No.: 05-30366

Chapter 11 Petition Date: January 4, 2005

Court: Northern District of Texas (Dallas)

Judge:  Steven A. Felsenthal

Debtor's Counsel: Lynne Renfro, Esq.
                  Law Offices of Gary R. Trebert
                  PO Box 569070
                  Dallas, Texas 75356-9070
                  Tel: (214) 634-6611
                  Fax: (214) 634-6644

Estimated Assets: $1 Million to $10 Million

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

Debtor's 6 Largest Unsecured Creditors:

    Entity                    Nature of Claim       Claim Amount
    ------                    ---------------       ------------
Delete Creditor               Promissory Note           $250,000
[address not provided]

Texas Comptroller of          Sales Taxes                 $5,320
Public Accounts
9241 LBJ Freeway, Suite 205
Dallas, Texas 75243
Tel: (972) 671-7166

Texas Comptroller of          Taxes                       $4,485
Public Accounts
9241 LBJ Freeway, Suite 205
Dallas, Texas 75243
Tel: (972) 671-7166

Trinity Medical Center        Medical Bill                $3,707
2401 Internet Boulevard
Suite 110
Frisco, Texas 75034

David Childs                  Property Taxes              $2,572
Tax Assessor Collector

Hebron Emergency Physicians   Medical Bill                  $538


CITATION CORP: Needs Until Jan. 28 to File a Chapter 11 Plan
------------------------------------------------------------
Citation Corporation and its debtor-affiliates ask the U.S.
Bankruptcy Court for the Northern District of Alabama for an
extension, through and including January 28, 2005, of the time
within which they alone can file a chapter 11 plan.  The Debtors
also ask the Court for more time to solicit acceptances of that
plan from their creditors, through April 15, 2005.

This is the Debtors' first request for an extension of their
exclusive periods.

The Debtors give the Court two reasons militating in favor of
their request for an extension of their exclusive periods:

   a) the Debtors' businesses are huge and complex that consist of
      a parent corporation, a holding company and 22 subsidiaries,
      which are all focused on the turnaround and reorganization
      of their businesses;

   b) one of the Debtor's affiliates is a plaintiff in an ongoing
      litigation against the Lycoming Reciprocating Engine
      Division of AVCO Corporation initiated in April 2003 in the
      District Court of Grimes County, Texas and still currently
      on trial.

The Court will convene a hearing at 1:30 p.m., on January 24,
2005, to consider the Debtors' extension motion.

Headquartered in Birmingham, Alabama, Citation Corporation --
http://www.citation.net/-- designs, develops and manufactures
cast, forged and machined components for the capital and durable
goods industries, including the automotive and industrial markets.
Citation uses aluminum, steel, gray iron, and ductile iron as the
raw materials in its various manufacturing processes.  The Debtors
filed for protection on Sept. 18, 2004 (Bankr. N.D. Ala. Case No.
04-08130).  Michael Leo Hall, Esq., and Rita H. Dixon, Esq., at
Burr & Forman LLP, represent the Debtors.  When the Company and
its debtor-affiliates filed for protection from their creditors,
they estimated more than $100 million in assets and debts.


CITATION CORP: Miller Buckfire Approved as Financial Advisor
------------------------------------------------------------
The U.S. Bankruptcy Court for the Northern District of Alabama
gave Citation Corporation and its debtor-affiliates permission to
employ Miller Buckfire Lewis Ying & Co., LLC as their financial
advisor and investment banker.

Miller Buckfire will:

   a) assist the Debtors in the analysis, design and formulation
      of their various options in connection with a restructuring
      of their businesses or a possible sale of assets;

   b) advise and assist the Debtors in the structuring and
      effectuation of the financial aspects of the transactions
      involving the restructuring of the Debtors' businesses and
      possible sale of assets;

   c) provide financial advise and assistance to the Debtors in
      developing and seeking approval of a plan of reorganization,
      including assisting the Debtors in negotiations with
      entities affected by the plan and participate in hearings
      before the Bankruptcy Court in relation to the plan; and

   d) provide financial advise and assistance in identifying and
      negotiating with potential acquirers in connection with any
      possible sale of assets, including the preparation of a
      memorandum to be used for solicitation of the potential
      acquirers.

Dure Savini, a Principal at Miller Buckfire, is the lead
professional performing services for the Debtors.  Mr. Savini
discloses that the Firm received a $150,000 prepetition retainer.

Mr. Savini reports Miller Buckfire's terms of compensation:

   a) a monthly advisory fee of $150,000;

   b) a Restructuring Fee of $3,500,000 in the event a
      restructuring of the Debtors' business is consummated and
      the Fee is payable upon the closing of the restructuring;
      and

   c) a Transaction Fee for any sale of the Debtors' assets or
      businesses that is consummated and the amount of the Fee
      will be agreed upon by the Debtors, Miller Buckfire and the
      parties involved in the sale.

Miller Buckfire assures the Court that it does not represent any
interest adverse to the Debtors or their estates.

Headquartered in Birmingham, Alabama, Citation Corporation --
http://www.citation.net/-- designs, develops and manufactures
cast, forged and machined components for the capital and durable
goods industries, including the automotive and industrial markets.
Citation uses aluminum, steel, gray iron, and ductile iron as the
raw materials in its various manufacturing processes.  The Debtors
filed for protection on Sept. 18, 2004 (Bankr. N.D. Ala. Case No.
04-08130).  Michael Leo Hall, Esq., and Rita H. Dixon, Esq., at
Burr & Forman LLP, represent the Debtors.  When the Company and
its debtor-affiliates filed for protection from their creditors,
they estimated more than $100 million in assets and debts.


CLARK GROUP: Charles W. Riske Approved as Liquidating Trustee
-------------------------------------------------------------
The Honorable James J. Barta of the U.S. Bankruptcy Court for the
Eastern District of Missouri confirmed the appointment of Charles
W. Riske, Esq., as the Liquidating Trustee for the estate of the
Clark Group, Inc., and its debtor-affiliates.

Mr. Riske is also the counsel for the Debtors' Official Committee
of Unsecured Creditors.  Mr. Riske's appointment is pursuant to
the terms of the Liquidating Trust Agreement under the Debtors'
confirmed Joint Prepackaged Plan of Reorganization.  The Court
confirmed the Debtors' Joint Plan on November 12, 2004.

Under the confirmed Joint Plan, Mr. Riske as the Liquidating
Trustee is authorized to administer the Liquidation Trust formed
under the Plan and distribute the proceeds of the Liquidation
Trust.  The Liquidation Trust consists of the remaining Net
Proceeds of the Purchase Consideration, and proceeds from the sale
of the Excluded Assets.

Under the Plan, Mr. Riske will distribute the proceeds of the
Liquidation Trust to Holders of Allowed Class 4A and Class 4B
Claims, and, to a limited extent if certain contingencies are
satisfied, to the Holders of the Allowed Victaulic Company Secured
Claims, on each Quarterly Distribution Date.

Mr. Riske assures the Court that he does not represent any
interest adverse to the Debtors, their creditors and other parties
in interest.

Headquartered in St. Louis, Missouri, Clark Group, Inc. --
http://www.clarksprinkler.com/-- provides a comprehensive line of
fire protection products and the highest quality service and
expert knowledge on fire protection products.  The Company and its
debtor-affiliates filed for chapter 11 protection on October 1,
2004 (Bankr. E.D. Mo. Case No. 04-52536).  Bonnie L. Clair, Esq.,
and David A. Sosne, Esq., at Summers, Compton, Wells & Hamburg,
PC, represent the Debtors in their restructuring efforts.  When
the Company filed for protection from its creditors, it listed
estimated assets and debts of $10 million to $50 million.


CURATIVE HEALTH: Inks Settlement Pact with Calif. Health Services
-----------------------------------------------------------------
Curative Health Services, Inc., (Nasdaq: CURE) and certain named
individual plaintiffs have entered into a Settlement Agreement
with the California Department of Health Services in connection
with the suits filed against DHS challenging the reimbursement
methodology for blood clotting factor implemented in June 2004.

Under the terms of the Settlement Agreement, DHS has agreed to
process, on a priority basis, all pending and future Medi-Cal,
California Children's Services and Genetically Handicapped Persons
Program claims submitted by the Company.  In addition, DHS has
agreed to expedite its efforts to implement electronic billing and
payment for blood clotting factor claims.

"We are very pleased with the conclusion of this litigation and
the priority processing of our claims," said President and Chief
Executive Officer, Paul F. McConnell.  "The priority processing
should result in a reduction of our California related days sales
outstanding to approximately 60 days and a meaningful improvement
in the Company's cash flow."

                  About Curative Health Services

Curative Health Services, Inc. -- http://www.curative.com/--  
seeks to deliver high-quality care and clinical results for
patients with serious or chronic medical conditions.

The Specialty Infusion business, through its national footprint of
Critical Care Systems' local pharmacy branches, provides products,
related clinical services and disease management support to
patients with chronic or severe conditions such as hemophilia and
other bleeding disorders, chronic or severe infections,
gastrointestinal illnesses that prohibit oral digestion and other
severe conditions requiring nutritional support, immune system
disorders, cancer and susceptibility to respiratory syncytial
virus.

The Wound Care Management business is a leader in the area of
disease management specializing in chronic wound care management.
The Wound Care Management business manages, on behalf of hospital
clients, a nationwide network of Wound Care Center(R) programs
that offer a comprehensive range of services for treatment of
chronic wounds.

In August 2004, Standard & Poor's Ratings Services revised its
outlook on Curative Health to negative from stable.  At the
same time, W&P affirmed its 'B' corporate credit rating and its
'B-' senior unsecured debt rating on the company's $185 million of
10-3/4% senior unsecured notes due May 1, 2011.  Moody's Investors
Service rated those notes at B3 in on April 6, 2004.  Bloomberg
bond pricing data shows those notes currently trade in the high
80s.


DEVLIEG BULLARD: Court Converts Case to Chapter 7 Proceeding
------------------------------------------------------------
The Honorable Mary F. Walrath of the U.S. Bankruptcy Court for the
District of Delaware entered an order on December 29, 2004,
approving a motion by DeVlieg Bullard II, Inc., to convert its
Chapter 11 bankruptcy case to a Chapter 7 liquidation proceeding.

The Court's order became effective on December 31, 2004.  The
Debtor filed a motion to convert its chapter 11 case to a chapter
7 proceeding on December 8, 2004.

As reported in the Troubled Company Reporter on December 10, 2004,
the Debtor gave the Court four reasons militating in favor of the
conversion:

   a) The Debtor ceased all its business operations and is in
      the process of liquidating its remaining assets and winding
      down its business affairs and its debtor-in-possession
      financing facility will expire on December 31, 2004;

   b) The Debtor and its retained professionals have worked
      diligently to sell and liquidate the Debtor's assets in a
      manner that has maximized the value of its assets for the
      benefit of its estate and its creditors;

   c) The Debtor can't pay administrative and priority claims due
      to lack of funding and can't formulate or confirm a
      plan of reorganization or liquidation; and

   d) The Debtor has worked with its secured lenders to ensure
      that a proposed Chapter 7 Trustee will have funds available
      to administer a chapter 7 estate.

Bankruptcy Court records do not indicate if the U.S. Trustee has
yet to designate a Chapter 7 Trustee to oversee the liquidation.

Headquartered in Machesney Park, Illinois, DeVlieg Bullard II,
Inc. -- http://www.devliegbullard.com/-- provides a comprehensive
portfolio of proprietary machine tools, aftermarket replacement
parts, field service and premium workholding products. The
Company filed for chapter 11 protection on July 21, 2004 (Bankr.
D. Del. Case No. 04-12097).  The Court converted the case to a
chapter 7 liquidation proceeding on December 29, 2004.  James E.
Huggett, Esq., at Flaster Greenberg, represents the Company. When
the Debtor filed for chapter 11 protection, it estimated debts and
assets of $10 million to $50 million.


DOMTAR INC: Restructures Northeastern Ontario Sawmill Operations
----------------------------------------------------------------
Domtar Inc. has entered into an agreement with Tembec Inc. that
will allow them to restructure their Northeastern Ontario sawmill
operations.

As a result of this agreement, Domtar will permanently close its
sawmill located in Chapleau on March 6, 2005.  The boiler and kiln
facilities associated with this operation will be sold to Tembec.
This will allow Tembec to process the increased lumber output of
its neighboring facility with fibre volumes historically
associated with the Domtar Chapleau sawmill.  Approximately 67
permanent jobs will be affected by this closure, although there
will be increased employment opportunities in the Tembec mill due
to the increased throughput.  This decision will result in asset
write-off and closure costs amounting to approximately
$14 million.

Domtar would also be adding a third shift at its Elk Lake facility
to process wood that has become available due to the closure of
the Tembec sawmill in Kirkland Lake, Ontario.  The processing of
this additional fibre will require 56 additional people beyond
those currently working at the Elk Lake facility.

The additional wood supply to the Elk Lake sawmill will not only
improve its competitive position but also enhance job security for
both sawmill employees and contractors involved in harvesting and
hauling activities.  It will also enable Domtar to leverage the
$12 million in capital investments that it has made in Elk Lake in
recent years, which include a new kiln, a new planer, saw line
improvements and new de-barker and boilers.

Domtar also indicated that it would invest in a finger-jointed
plant with Tembec.  This facility will be located on the site of
the Tembec Kirkland Lake sawmill slated for closure.  It is
expected to create between 70 and 92 jobs, depending on the final
plant configuration.

"The Ontario lumber industry, including Domtar, is experiencing
some very challenging times, notably high energy costs, a
declining U.S. dollar, countervailing and anti-dumping duties on
softwood lumber exported to the U.S., as well as a forecasted
reduction of wood supply.  Given these challenges, Domtar welcomes
the support from the Ontario Minister of Natural Resources, David
Ramsay, in this restructuring, which will enhance the economics
and the competitive position of the Elk Lake facility," said
Richard Garneau, Senior Vice-President, Forest Products, Domtar
Inc.

Meetings with employees and union leaders were also held at each
of the sawmills impacted by this decision.  Domtar notably
informed employees at its Chapleau facility that, in keeping with
its corporate values, the Company would do its utmost to help
employees affected by today's announcement.  In fact, Domtar will
attempt to re-deploy affected personnel.  Moreover, employees that
lose their jobs will receive severance packages and will be given
access to outplacement services.

                        About the Company

Based in Montreal, Quebec, Domtar Inc. is a major North American
producer of fine papers, pulp, and lumber.  More than 60% of the
company's sales come from its paper segment, which churns out a
variety of communication and specialty papers, including offset
printing paper, photocopying paper, fine paper, and technical
papers.

                         *     *     *

As reported in the Troubled Company Reporter on Oct. 28, 2004,
Standard & Poor's Ratings Services revised its outlook on Domtar
Inc. to negative from stable.  At the same time, the 'BBB-' long-
term corporate credit, the 'BBB-' senior unsecured debt, and the
'BB' global scale preferred stock ratings were affirmed.

"The outlook revision reflects concerns that profitability and
cash flow generation will be weaker-than-expected as a result of
the appreciation of the Canadian dollar," said Standard & Poor's
credit analyst Daniel Parker.


DONNKENNY, INC.: CIT Credit Agreement in Default at Dec. 31
-----------------------------------------------------------
In a regulatory filing with the Securities and Exchange Commission
this week, Donnkenny, Inc., disclosed that, as of December 31,
2004, the Company was not in compliance with the monthly financial
covenants buried in its $65 million credit facility with
CIT/Commercial Services.

"The Company and its Lender are in discussions concerning the
impact of this non-compliance and the relationship between the
Company and its Lender," CEO Daniel H. Levy advises.

All of Donnkenny's cash and liquidity requirements to operate its
business are provided through the Credit Agreement.  Accordingly,
the Company is wholly dependant upon CIT to provide credit for the
operation of its business.  Absent CIT's continued support and
adequate funding, Donnkenny says it will have inadequate working
capital and funding to operate its business and will cease to
operate as a going concern.  Under those circumstances, Donnkenny
says it will "seek judicial relief under the Bankruptcy Law."

                       The Credit Facility

On June 29, 1999, Donnkenny, Inc., and its operating subsidiaries
entered into a Credit Agreement with CIT Group/Commercial
Services.  The Credit Agreement initially provided the Company
with a $75 million facility comprised of a $72 million revolver
with sub-limits up to $52 million for direct borrowings, $35
million for letters of credit, certain overadvances and a $3
million term loan which was paid in full as of June 30, 2002.

The Credit Agreement provides for advances of (i) up to 90% of
eligible accounts receivable plus (ii) up to 60% of eligible
inventory plus (iii) up to 60% of the undrawn amount of all
outstanding letters of credit plus (iv) allowable overadvances.

Collateral for the Credit Agreement includes a first priority lien
on all accounts receivable, machinery, equipment, trademarks,
intangibles and inventory, a first mortgage on all real property
and a pledge of the Company's stock interest in its operating
subsidiaries, Donnkenny Apparel, Inc. and Beldoch Industries
Corporation. The Credit Agreement contains numerous financial and
operational covenants, including limitations on additional
indebtedness, liens, dividends, stock repurchases and capital
expenditures. In addition, the Company is required to maintain
specified levels of tangible net worth and comply with a
requirement for minimum earnings before depreciation,
amortization, interest and taxes (EBITDA) and a minimum interest
coverage ratio.

                         Prior Defaults

Effective June 30, 2003, the Company through an Amendment and
Waiver Agreement dated August 11, 2003, extended the Credit
Agreement to June 30, 2007.  This Amendment provided the Company
with a $65 million facility; the sub-limits remained the same as
in the original Credit Agreement. The interest rate on the
revolving credit borrowings is the current prime rate plus one and
one-quarter percent (6.00% at September 30, 2004).

As previously reported, on December 31, 2003 and June 30, 2004,
the Company was not in compliance with the financial covenants
contained in the Credit Agreement.  In each instance, the Lender
has waived these events of non-compliance.

As of September 30, 2004, the Company was not in compliance with
the quarterly financial covenants.  Through an Amendment and
Waiver Agreement dated October 1, 2004, the Lender agreed to waive
the Company's non-compliance with its September 30, 2004 quarterly
financial covenants.  This Amendment and Waiver Agreement amended
the financial covenants to provide that these covenants will be
evaluated by the Lender monthly rather than quarterly beginning
October 31, 2004.  For the month ended October 31, 2004, the
Company continued not to be in compliance with the Credit
Agreement financial covenants.  The Lender has waived this non-
compliance.

In November 2004, Donnkenny indicated it didn't expect to be in
compliance with its financial covenants for the balance of 2004.
The company's prediction came true.  In November, the Company paid
CIT a $25,000 fee to waive the then-existing defaults.

                       Factoring Agreement

The Company also has a factoring agreement with CIT
Group/Commercial Services.  The factoring agreement provides for a
factoring commission equal to .35% of gross sales, plus certain
customary charges. The factoring agreement renews annually in June
each year unless either party to the agreement gives appropriate
notice of non-renewal.

                        About the Company

Donnkenny designs, manufactures, imports and markets a broad line
of moderate and better-priced women's and junior's sportswear and
ladies coats.  The Company's major labels include Pierre
Cardin(R), Harve Benard(R), Donnkenny(R), Casey & Max(R), Victoria
Jones(R) and Z. Cavaricci(R), as well as ladies coats under the
Bill Blass(R), Bill Blass Signature(R), Blassport(R) and Nicole
Miller(R) labels, and suits under the Nicole Miller(R) label.  The
Company's Sept. 30, 2004, balance sheet shows $45.6 million in
assets and a $4.5 million shareholder deficit.  Donnkenny is
headquarted in Manhattan; owns two facilities in Virginia; and
leases five additional facilities (one in Summerville, South
Carolina, one in New York State, one in Burlington, New Jersey,
one in Poland and one in Hong Kong).


DPL CAPITAL: S&P Affirms B Ratings on Six Security Classes
----------------------------------------------------------
Standard & Poor's Ratings Services affirmed its ratings on three
synthetic transactions related to DPL Capital Trust II and removed
them from CreditWatch negative, where they were placed
March 19, 2004.

These rating actions reflect the affirmation of the rating
assigned to DPL Capital Trust II's $300 million 8.125% trust
preferred capital securities and its subsequent removal from
CreditWatch.

These DPL Capital Trust II-related transactions are
swap-independent synthetic transactions that are weak-linked to
the underlying collateral, DPL Capital Trust II's $300 million
8.125% trust preferred capital securities, which are guaranteed by
DPL, Inc.

A copy of the DPL, Inc.-related summary analysis, dated
Dec. 16, 2004, can be found on RatingsDirect, Standard &
Poor's Web-based credit analysis system.

     Ratings Affirmed and Removed from Creditwatch Negative

      Structured Asset Trust Units Repackagings (SATURNS)
           DLP Capital Security Backed Series 2002-3
          $54.55 million callable units series 2002-3

                             Rating
                 Class     To      From
                 -----     --      ----
                 A units   B       B/Watch Neg
                 B units   B       B/Watch Neg

      Structured Asset Trust Units Repackagings (SATURNS)
           DLP Capital Security Backed Series 2002-4
          $42.5 million callable units series 2002-4

                             Rating
                 Class     To      From
                 -----     --      ----
                 A units   B       B/Watch Neg
                 B units   B       B/Watch Neg

      Structured Asset Trust Units Repackagings (SATURNS)
           DLP Capital Security Backed Series 2002-7
            $25 million callable units series 2002-7

                             Rating
                 Class     To      From
                 -----     --      ----
                 A units   B       B/Watch Neg
                 B units   B       B/Watch Neg


FALCON PRODUCTS: Expects Inventory Write-Down of $20 Million Up
---------------------------------------------------------------
Falcon Products, Inc. (OTC: FCPR), a leading manufacturer of
commercial furniture, expects to record a significant charge
relating to the write-down of inventory.  The amount of the
inventory write-down, and the underlying causes, are still under
review.  Management currently estimates that the inventory write-
down will exceed $20 million, including approximately $4 million
relating to a previously closed facility.  However, such estimate
is preliminary and the actual amount of any inventory write-down
may be materially different from the preliminary estimate.  The
Company had previously disclosed that certain deficiencies in
internal controls existed related to accounting for inventory and
that it intended to take certain actions to improve inventory
controls.  Such actions included performance of a physical
inventory of finished goods and work in process on a quarterly
basis, improved cycle counting procedures, increased corporate
oversight of the controls and procedures over inventory and the
hiring of experienced inventory personnel.  During the course of
Audit Committee investigation, it has been determined that these
stated actions were either not taken or not completely and
properly implemented.  Previously, the Company hired a new chief
financial officer in late October whose responsibilities include
addressing these deficiencies.

The impact, if any, of the expected inventory write-down on the
results of the first three quarters of fiscal year 2004, and on
periods prior to fiscal year 2004 has not yet been determined.
Although the Company believes that it is likely that the inventory
write-down will impact prior periods, no definitive conclusion has
yet been reached as to whether prior periods are affected or
whether the impact on prior periods will warrant a restatement of
prior period financial statements.  As soon as practicable
following the completion of its investigation of the inventory
write-down, the Company intends to announce its final conclusions
and, if necessary, file the required amendments to its previous
filings with the Securities and Exchange Commission.

Previously, the Company's Audit Committee commenced an
investigation, with the assistance of independent counsel, into
certain accounting matters.  The Audit Committee investigation is
ongoing.  On Dec. 20, 2004, the SEC informed the Company that it
is conducting a non-public inquiry into certain accounting matters
including inventory-related issues.  The Company intends to fully
cooperate with this inquiry.

The Company also declared that it was not in compliance with
certain provisions under its senior credit facilities, and has
been advised by its lenders that, while the Company's request for
waivers of such defaults are under review, the lenders are
unwilling to provide such waivers at this time.  Any restatement
of the Company's financial statements for prior periods could
result in additional events of default under the Company's various
debt agreements. Although the defaults under the senior credit
facilities are continuing, the Company continues to have access to
borrowings under its revolving credit facility and its ability to
serve its customers and pay its employees and vendors in the
ordinary course has not been affected.

On Dec. 15, 2004, the Company stated that it was utilizing the 30-
day grace period relating to the payment of interest under its
$100 million 11-3/8% Senior Subordinated Notes due 2009.  Although
a final determination has not yet been made as to whether the
Company will be able to make the interest payment prior to the
expiration of the grace period on January 14, 2005, it is
currently likely that such payment will not be made.  The non-
payment of the interest would constitute an event of default under
the Notes as well as under the Company's senior credit facilities.

The Company has had preliminary discussions with a large holder of
the Notes regarding a possible transaction that would convert the
Notes to equity, however, the feasibility of such a transaction
has not yet been determined.  In addition, the Company, along with
its financial advisor Imperial Capital LLC, is evaluating various
strategic alternatives relating to a possible restructuring of the
Company's outstanding indebtedness.

                        About the Company

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

                          *     *     *

As previously reported in the Troubled Company Reporter on Dec 23,
2004, Moody's Investors Service downgraded the senior subordinated
notes of Falcon Products, Inc., to C from Ca, and the issuer
rating of Falcon Products, Inc., to C from Caa2, and downgraded
the senior implied rating to Ca from Caa1. The rating outlook
remains negative.


FRANKLIN CAPITAL: Asks Stockholders to Okay 2-for-1 Stock Split
---------------------------------------------------------------
Franklin Capital Corporation's (AMEX: FKL) Board of Directors has
unanimously determined to seek stockholder approval at its 2004
annual meeting of stockholders to effect a two-for-one split of
Franklin Capital's common stock.  The stock split would increase
the number of shares of Franklin Capital's common stock
outstanding from approximately 1.5 million to approximately 3.0
million shares of common stock.

"The increase in the number of outstanding shares of Franklin
Capital's common stock and the lower market price per share
expected to result from the stock split is designed to broaden the
market for, and improve the marketability and liquidity of, the
common stock and ultimately increase the number of stockholders of
Franklin Capital," said Milton "Todd" Ault, III, the Chairman and
Chief Executive Officer of Franklin Capital.  "Franklin Capital
believes that the stock split is another important step in the
execution of the strategic restructuring plan that it announced in
June 2004 and will make its common stock more accessible to a
broader range of investors."

Franklin Capital will file a proxy statement in connection with
its 2004 annual meeting of stockholders.  Franklin Capital's
stockholders are advised to read the proxy statement relating to
the annual meeting of stockholders of Franklin Capital when it
becomes available, as it will contain important information.
Stockholders will be able to obtain this proxy statement, any
amendments or supplements thereto, and any other documents filed
by Franklin Capital with the Securities and Exchange Commission
for free at the Internet website maintained by the Securities and
Exchange Commission at http://www.sec.gov/ Also, Franklin Capital
will mail the proxy statement to each stockholder of record on the
record date to be established for 2004 annual meeting of
stockholders of Franklin Capital.  Copies of the proxy statement
and any amendments and supplements thereto will also be available
for free by writing to:

         Corporate Secretary
         Franklin Capital Corporation
         100 Wilshire Boulevard
         Suite 1500
         Santa Monica, Calif. 90401

Franklin Capital, its directors and its executive officers may be
deemed to be participants in the solicitation of proxies in
connection with the 2004 annual meeting of stockholders.
Information regarding these participants is contained in a filing
under Rule 14a-12 of the Securities and Exchange Act of 1934 filed
by Franklin Capital Corporation with the SEC on January 3, 2005.

                        About the Company

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

                          *     *     *

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


FRIEDMAN'S INC: In Talks with Lenders to Amend Financial Covenants
------------------------------------------------------------------
Friedman's Inc. (OTC non-BB: FRDM.PK), disclosed that delayed
receipts of inventory shipments during the 2004 holiday season and
the implementation of more prudent credit practices had a negative
impact on its holiday season sales and contributed to the Company
not meeting the December 2004 minimum sales covenants in its
credit facility.  Friedman's is currently in discussions with its
senior lenders regarding the amendment of its financial covenants
under the credit facility and regarding the terms of other
modifications to the credit facility.  There can be no assurances
of obtaining the amendment.

The Company has reached agreement with substantially all of the
participating vendors to amend the terms of its secured trade
credit program initiated on Sept. 8, 2004.  The amendment modifies
the conditions vendors must meet for continued qualification under
the program, including provisions relating to future shipments by
participating vendors to support the Company's Valentine's Day
sales plan.  The amendment also revised the schedule of
amortization payments to vendors under the program.

Mr. Sam Cusano, Friedman's CEO, said: "Delays in shipments and the
implementation of more prudent credit practices have clearly had a
negative effect on our holiday season, making it necessary for us
to seek amendments to our secured trade credit program and to our
credit facility.  Friedman's appreciates the ongoing support of
both our lenders and vendors as the Company works through the
challenges and changes necessary to restore and rebuild
Friedman's."

Additional details regarding the amendment to the trade credit
program and any amendment to the credit facility will be released
in Current Reports on Form 8-K to be filed with the SEC.

                       About Friedman's

Founded in 1920, Friedman's Inc. -- http://www.friedmans.com/--  
is a leading specialty retailer based in Savannah, Georgia.  The
Company is the leading operator of fine jewelry stores located in
power strip centers and regional malls.

                          *     *     *

As reported in the Troubled Company Reporter on Nov. 4, 2004,
Friedman's Inc. said it anticipated breaching the financial
covenants contained in its amended and restated credit
facility.  In particular, Friedman's expected to fail to meet
cumulative EBITDA requirements and a minimum ratio of Accounts
Payable to Inventory.  Friedman's senior secured credit facility,
entered into in September 2004, consists of a senior revolving
loan of up to $67.5 million (maturing in 2006) and a $67.5 million
junior term loan (maturing in 2007).  Friedman's issued some
warrants to Farallon Capital Management, L.L.C., in connection
with that refinancing transaction.

Friedman's also entered into a secured trade credit program
providing security to vendors.  Part of the deal allows Friedman's
to stretch payment of invoices past due in July 2004 through 2005.

The company's most recently published balance sheet -- dated
June 28, 2003 -- shows $496 million in assets and $190 million in
liabilities.  The Company explains that its year-end closing
process was delayed because of an investigation by the Department
of Justice, a related informal inquiry by the Securities and
Exchange Commission, and its Audit Committee's investigation into
allegations asserted in a August 13, 2003, lawsuit filed by
Capital Factors Inc., a former factor of Cosmopolitan Gem
Corporation, a former vendor of Friedman's, as well as other
matters. Ernst & Young has been working on a restatement of the
company's financials.  The company's signaled that a 17% or
greater increase to allowances for accounts receivable can be
expected.


GLEN CARTER EXCAVATING: Voluntary Chapter 11 Case Summary
---------------------------------------------------------
Debtor: Glen Carter Excavating Company
        P.O. Box 527
        Brookline, Missouri 65619

Bankruptcy Case No.: 04-63320

Type of Business: The Debtor is an excavating contractor.

Chapter 11 Petition Date: December 27, 2004

Court: Western District of Missouri (Springfield)

Judge: Arthur B. Federman

Debtor's Counsel: M. Brent Hendrix, Esq.
                  1615 South Ingram Mill, Building F
                  Springfield, MO 65804
                  Tel: 417-889-8820
                  Fax: 417-889-3493

Total Assets: $500,000 to $1 Million

Total Debts:  $1 Million to $10 Million

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


HAPPY KIDS INC: Case Summary & 30 Largest Unsecured Creditors
-------------------------------------------------------------
Lead Debtor: Happy Kids Inc.
             100 West 33rd Street, Suite 1100
             New York, New York 10001

Bankruptcy Case No.: 05-10016

Debtor affiliates filing separate chapter 11 petitions:

      Entity                                     Case No.
      ------                                     --------
      Happy Kids Jeanswear Inc.                  05-10017
      Hawk Industries, Inc.                      05-10018
      J&B 18 Corporation                         05-10019

Type of Business: The Debtors are leading designers and marketers
                  of licensed, branded and private label garments
                  in the children's apparel industry.  The
                  Debtors' current portfolio of licenses includes
                  Izod (TM), Calvin Klein (TM) and And1 (TM).

Chapter 11 Petition Date: January 3, 2005

Court: Southern District of New York (Manhattan)

Judge:  Cornelius Blackshear

Debtor's Counsel: Sheldon Ira Hirshon, Esq.
                  Scott K. Rutsky, Esq.
                  Sanjay Thapar, Esq.
                  Proskauer Rose LLP
                  1585 Broadway
                  New York, New York 10036
                  Tel: (212) 969-3000
                  Fax: (212) 969-2900

Turnaround and
Management
Consultants:      Carl Marks Consulting Group LLC

Claims and
Noticing Agent:   Donlin, Recano & Company, Inc.

Consolidated Financial Condition as of December 24, 2004:

      Total Assets: $54,719,000

      Total Debts:  $82,108,000

Consolidated list of Debtors' 30 Largest Unsecured Creditors:

    Entity                       Nature of Claim    Claim Amount
    ------                       ---------------    ------------
The CIT Group/Commercial         Deficiency Claim        Unknown
Services, Inc.                   under Financing
1211 Avenue of the Americas      Agreement
New York, New York 10036
Attn: John Daly
      Grover Reinle
Tel: (212) 382-6839
Fax: (212) 382-6840

Deutsche Bank Trust Company      Deficiency Claim    $24,000,000
Americas                         on Senior Term
60 Wall Street                   Loan Note
New York, New York 10005
Attn: Mark Cohen
Tel: (212) 250-6038
Fax: (212) 797-5695

J.H. Whitney Mezzanine           Unsecured Note       $4,128,334
Fund, L.P.
177 Broad Street
Stamford, Connecticut 06901
Attn: Daniel O'Brien
Tel: (203) 973-1422

Deutsche Bank Trust Company      Unsecured Note       $2,314,758
Americas
60 Wall Street
New York, New York 10005
Attn: Mark Cohen
Tel: (212) 250-2500

MGA Entertainment                Royalty Payments     $1,456,044
16730 Schoenborn Street
North Hills, California 91343
Attn: Issac Larian
      Donna Cunningham

AND 1                            Royalty Payments     $1,189,250
919 Conestoga Road
Building 1, Suite 100
Rosemont, Pennsylvania 19010

Mecca USA                        Royalty Payments       $443,650
c/o International News, Inc.
19226 70th Avenue
Kent, Washington 98032

4Kids Entertainment              Royalty Payments       $329,924
1414 Avenue of the Americas
New York, New York 10019
Attn: Joseph P. Garrity

1275/1291 Broadway LLC           Lease                  $262,519
100 West 33rd Street
New York, New York 10001

Sin Hua Knitting Factory Ltd.    Supplier               $208,483

Head to Toe                      Supplier               $192,594

Trasol Trading Corporation       Foreign Buying         $192,108
                                 Agent

Sunjuly Company Ltd.             Foreign Buying         $175,814
                                 Agent

Shirwell International Ltd.      Supplier               $168,446

Bureau of Customs and            Customs Duties         $155,000
Border Protection

Djem Jeans                       Supplier               $124,941

Hockey Sport SA DE CV            Supplier               $121,273

Warner Brothers Consumer         Royalty                $118,610
Products, Inc.

Disney Enterprises Inc.          Royalty                $112,558

Price Transfer Inc.              Public Warehouse       $108,955

Stilz Inc.                       Supplier                $96,978

Rajby Industries                 Supplier                $87,798

Textiles Thor SAC                Supplier                $82,959

On Target Staffing/Capital       Labor at Warehouse      $75,000
Temp.

RCS Logistics                    Freight Forwarder       $74,000

Regal Packaging                  Warehouse Supplies      $66,987

Grant Thornton LLP               Accounting              $66,868

Jacol International              Supplier                $59,009
Company Limited

D&A Comercio Exterior            Supplier                $57,985

Bravado International            Supplier                $56,786
Group Inc.


INTEGRATED HEALTH: Briarwood Wants Stock Purchase Deal Completed
----------------------------------------------------------------
On January 28, 2003, Integrated Health Services, Inc., and Abe
Briarwood Corporation entered into a Stock Purchase Agreement,
pursuant to which Abe Briarwood was to essentially acquire all of
IHS' assets, with certain exemptions.

Frederick B. Rosner, Esq., at Jaspan Schlesinger Hoffman, LLP, in
Wilmington, Delaware, tells the United States Bankruptcy Court for
the District of Delaware that Briarwood's obligations under the
SPA were conditioned on IHS' satisfaction of various conditions
under Article VI of the SPA, including that:

    (a) IHS' representations and warranties contained in the SPA
        will be true and correct in all material respects;

    (b) the IHS Debtors will have performed or complied with each
        of the covenants and agreements set forth in the SPA; and

    (c) IHS will deliver to Briarwood a certificate certifying
        that the conditions set forth in Sections 6.1 and 6.2 of
        the SPA have been satisfied.

On August 29, 2003, IHS provided Briarwood with the Certificate.
In reliance on IHS' Certificate and the representations it
contained, Briarwood closed on the SPA.

Unknown to Briarwood at that time, IHS failed to comply with
certain of the representations, warranties, covenants or
agreements set forth in the SPA.  Consequently, Briarwood
diligently attempted to informally resolve its claims against IHS
Liquidating, LLC, under the SPA.  However, Briarwood and IHS
Liquidating were not able to informally resolve the claims.

                          Trust Fund Taxes

The Internal Revenue Code requires employers to withhold federal
income and social security taxes from their employees' wages.
The withheld taxes are deemed to be a special fund held in trust
for the benefit and exclusive use of the Government, and are
commonly called "trust fund taxes."

However, the IHS Debtors failed to remit to the appropriate
"Governmental Authorities" substantial sums in "trust fund taxes,"
which were withheld from employee payroll checks on or before the
August 29, 2003, Closing, including "trust fund taxes" from
employee payroll checks funded on or before the Closing Date.  As
a result, Briarwood had to pay the IHS Debtors' substantial
employee "trust fund tax" obligations out of its own funds.
Briarwood is still trying to determine the exact amount owed by
IHS Liquidating for the "trust fund taxes."  It is estimated that
the amount will be substantial, Mr. Rosner says.

                      Georgia Medicaid Payments

On November 4, 2003, Kim Hinton, the Director of Financial
Services of the Georgia Department of Community Health, testified
during an evidentiary hearing before the Court that the Georgia
Medicaid Authorities provided the Debtors with over $9,000,000 in
"prospective" Medicaid payments from April 2003 through
August 2003.  Since that time, the "prospective" payments made by
the Georgia Medicaid Authorities to the IHS Debtors have been
recouped from Briarwood.

Mr. Rosner relates that the Georgia Medicaid Authorities
characterized the excess Medicaid payments that were provided to
the IHS Debtors as "prospective" payments as they were clearly
intended for future medical services to be rendered.
Consequently, these "prospective" Medicaid payments were clearly
"prepaid items."

Although the IHS Debtors were permitted under the Stock Purchase
Agreement to remove "Cash" on hand at the Closing, they were not
permitted to remove either "prepaid items" or "deposits."  Thus,
under the terms of the Stock Purchase Agreement, there should have
been "Cash" left of at least $9,100,000 to cover the "prepaid
items."  Instead, the IHS Debtors removed all the "Cash," causing
the $9,100,000 owed to the Georgia Medicaid Authorities to be
ultimately recouped from Briarwood.

"The [IHS] Debtors certainly knew they were getting double (2x)
payments which were not for current billing and services," Mr.
Rosner says.  "The double (2x) payments received by the [IHS]
Debtors should have either been returned to the Georgia Medicaid
Authorities or escrowed for prospective services to be rendered if
authorized to do so."

"[T]he [IHS] Debtors should have treated such funds in the nature
of 'deposits' and should have set aside 'Cash' in the amount of at
least $9.1 million to cover these deposits," Mr. Rosner contends.

                      Post-Closing Receivables

Briarwood's obligations under the Stock Purchase Agreement were
conditioned on the IHS Debtors' compliance with a "Medicare
Settlement."  Pursuant to the Medicare Settlement, the IHS
Debtors were required to execute a comprehensive settlement
agreement with certain federal agencies, including the United
States Department of Justice, the Centers for Medicare and
Medicaid Services and the Office of the Inspector General,
"providing for a full settlement and compromise of all asserted
claims" against the IHS Debtors arising under certain federally
funded governmental health care programs.

The United States had asserted certain claims against the IHS
Debtors for civil or administrative monetary claims:

    * under the False Claims Act, the Program Fraud Civil Remedies
      Act, and the common law doctrines of payment by mistake,
      unjust enrichment, breach of contract, or fraud;

    * for certain civil monetary penalties imposed pursuant to the
      Civil Monetary Penalties Law; and

    * for permissive exclusion from Medicare, Medicaid, and other
      Federal health programs.

On August 28, 2003, the IHS Debtors, as required under the Stock
Purchase Agreement, entered into a settlement agreement with the
United States, which required the IHS Debtors to pay the
Department of Justice $19,100,000 in connection with the False
Claims Act Claims.  The Medicare Settlement carries out the intent
of the Stock Purchase Agreement that the asserted claims,
including the United States False Claims Act Claims, would be paid
solely by the IHS Debtors and not by Briarwood, being a non-party
to the Medicare Settlement.  Hence, the IHS Debtors were solely
responsible for the False Claims Act Payment.

Nevertheless, IHS Liquidating improperly used $17,100,000 of post-
closing collections of Briarwood's receivables to pay the asserted
claims referred under the Stock Purchase Agreement, including the
False Claims Act Claims, despite the fact that Briarwood acquired
all of the IHS Debtors' assets, except for certain designated
"Excluded Assets," under the Stock Purchase Agreement.

Moreover, IHS did not designate a $17,100,000 receivable from the
Centers for Medicare and Medicaid Services as one of the
"Excluded Assets" under the Stock Purchase Agreement.  This
$17,100,000 receivable was one of the assets acquired by Briarwood
under the terms of the Agreement.

                        Trade Vendor Payments

The Stock Purchase Agreement defined "Ordinary Course of
Business" to mean "the ordinary course of business consistent with
past custom and practice" of the IHS Debtors, "including with
respect to quantity and frequency."

According to Mr. Rosner, the IHS Debtors did not pay their trade
vendors $9,000,000 in the "Ordinary Course of Business," as
required under the Stock Purchase Agreement.  As a result,
Briarwood was forced to pay the trade vendor obligations, which
should have been paid on or before the Closing.

                       IOS Settlement Payment

In January 2002, the IHS Debtors brought an avoidance action
against IOS Capital, Inc., seeking to recover $251,814 in payments
made to IOS on certain leases as either preferences or fraudulent
conveyances.

On August 27, 2003, the IHS Debtors, without Briarwood's
knowledge, entered into a settlement stipulation with IOS, which
provided for, among other things, payment to IOS of an allowed
administrative claim for $350,000 and the dismissal of the IOS
Preference Action, despite prohibition under the Stock Purchase
Agreement.

Briarwood opposed the IOS Settlement essentially on the ground
that any financial liability incurred under it, including payment
of the $350,000 administrative claim, should belong to the HIS
Debtors and not to Briarwood.  Briarwood further argued that the
IOS Settlement was an "Excluded Liability" under the Stock
Purchase Agreement, which was not acquired by Briarwood and
remains the responsibility of either the IHS Debtors of IHS
Liquidating.

Nevertheless, to resolve their dispute without a protracted
litigation, Briarwood paid IOS the $350,000 administrative claim,
without prejudice to its right to assert a claim over against IHS
Liquidating for all amounts paid by Briarwood under the IOS
Settlement.

Mr. Rosner explains that under the terms of the Stock Purchase
Agreement, Briarwood is entitled to reimbursement of that amount
from IHS Liquidating, since any monies owed to IOS was an
"Excluded Liability," as it essentially related to and resolved an
"Excluded Asset."  Therefore, IHS Liquidating should be compelled
to comply with the terms of the Stock Purchase Agreement, and
reimburse Briarwood the $350,000 it paid to IOS for its Excluded
Liability.

According to Mr. Rosner, IHS Liquidating should reimburse
Briarwood, since the Stock Purchase Agreement precluded the IHS
Debtors from:

    -- entering into a settlement and incurring debt to IOS in
       excess of $250,000 without Briarwood's written approval
       during the prohibited period from January 28, 2003, to the
       Closing Date of the Stock Purchase Agreement; and

    -- failing to make its monthly payments on the IOS Leases in
       the ordinary course of business.

"If [IHS Liquidating] does not reimburse Briarwood, it will have
been unjustly enriched in the amount of $350,000," Mr. Rosner
says.

                   Briarwood Should be Reimbursed

Accordingly, Briarwood asks the Court to compel IHS Liquidating to
comply with the terms of the Stock Purchase Agreement.

Mr. Rosner asserts that Briarwood's request should be granted on
the grounds that IHS Liquidating:

    (1) should reimburse Briarwood's substantial payments to
        Governmental Authorities for the IHS Debtors' "trust fund
        taxes" due on their employee's wages, since it was the IHS
        Debtors' responsibility to make the payments under both
        law and the Stock Purchase Agreement;

    (2) should reimburse Briarwood for $9,100,000 in recoupment
        payments to the Georgia Medicaid authorities based on the
        IHS Debtors' receipt of "prospective" or excessive
        Medicaid payments in that amount, as a result of the IHS
        Debtors' failure in segregating "cash" for the "Pre-paid
        Items" and "Deposits," as required under the Stock
        Purchase Agreement;

    (3) improperly collected $17,100,000 in Post-Closing
        receivables due to Briarwood, since they were not
        "Excluded Assets" under the terms of the Stock Purchase
        Agreement;

    (4) should reimburse Briarwood's $9,000,000 in payments to the
        IHS Debtors' trade vendors, since the IHS Debtors failed
        to make the payments in the "ordinary course" of their
        "business," as required under the Stock Purchase Agreement
        and as they represented and certified in their certificate
        at Closing; and

    (5) should reimburse Briarwood's $350,000 payment to IOS,
        since, among other things, it was an "Excluded Liability"
        under the Stock Purchase Agreement, as it was a settlement
        payment relating to the IOS Preference Action, which was
        an "Excluded Asset" under the Stock Purchase Agreement.

Integrated Health Services, Inc. -- http://www.ihs-inc.com/--
operated local and regional networks that provide post-acute care
from 1,500 locations in 47 states.  The Company and its
437 debtor-affiliates filed for chapter 11 protection on
February 2, 2000 (Bankr. Del. Case No. 00-00389).  Rotech Medical
Corporation and its direct and indirect debtor-subsidiaries broke
away from IHS and emerged under their own plan of reorganization
on March 26, 2002.  Abe Briarwood Corp. bought substantially all
of IHS' assets in 2003.  The Court confirmed IHS' Chapter 11 Plan
on May 12, 2003, and that plan took effect September 9, 2003.
Michael J. Crames, Esq., Arthur Steinberg, Esq., and Mark D.
Rosenberg, Esq., at Kaye, Scholer, Fierman, Hays & Handler, LLP,
represent the IHS Debtors.  On September 30, 1999, the Debtors
listed $3,595,614,000 in consolidated assets and $4,123,876,000 in
consolidated debts.  (Integrated Health Bankruptcy News, Issue No.
87; Bankruptcy Creditors' Service, Inc., 215/945-7000)


INTERSTATE GENERAL: Continuing Losses Prompt PCXE to Halt Trading
-----------------------------------------------------------------
Interstate General Company L.P. (Pacific: IGC) had received notice
from the Pacific Stock Exchange that IGC is not in compliance with
the requirements for continued listing of the Company's Class A
Units on the PCXE.  The determination by the PCXE was based upon
the Company's disclosure in its December 15 and December 22, 2004,
news releases of having losses from continuing operations and/or
net losses in each of its five most recent fiscal years (which
violates PCXE Rule 5.5 (1)(3)).  Trading in the Company's Units
was suspended by the PCXE effective before the opening of business
on Dec. 29, 2004.

The PCXE will conduct a formal review of the Company's listing
status on January 20, 2005 in order to determine whether continued
listing is appropriate.  The PCXE has requested that the Company
submit in writing any relevant information for its consideration
at such hearing.  As noted in the Company's previous press
releases relating to its delisting by the American Stock Exchange
("AMEX"), IGC does not have available resources to bring the
Company into compliance with the PCXE's listing qualification.
Accordingly, the Company expects the PCXE will decide to delist
its Units at the close of business on January 20, 2005.  IGC does
not intend to appeal the expected decision to delist the Company's
Units.

IGC expects that the PCXE will submit an application to the
Securities and Exchange Commission to strike the Company's Units
from listing and registration on the PCXE within five business
days after January 20, 2005.

As stated in the Company's press release dated December 14, 2004,
when it announced that it had received notice from the AMEX of
non-compliance with its listing requirements, the Company's
management and board of directors are considering steps to be
taken to protect the Unit holders' equity in the Company following
the delisting of its Units.

                        About the Company

Interstate General Company L.P.'s principal activities are to
develop and sell residential and commercial land and to find
innovative solutions for disposal of municipal waste.  The real
estate activities include community development, development and
ownership of rental apartments and real estate management
services. The Group also pursues waste disposal contracts with
municipalities and government entities as well as industrial and
commercial waste generators.

                       Going Concern Doubt

The Company received a "going concern" qualification in the
opinion of its independent auditors for its 2002 financial
statements.  The Company has received a similar qualification in
its independent auditor's opinion for its 2003 financial
statements.  The Company expects to incur further losses in 2004
and to be severely constrained financially unless and until an
equity investor is obtained for its Brandywine project and
development equity is obtained for its Puerto Rico waste project.

In its Form 10-QSB for the quarterly period ended Sept. 30, 2004,
filed with the Securities and Exchange Commission, Interstate
General posts a $1,504,000 net loss in Sept. 2004 compared to a
$696,000 net loss from the previous year.


INT'L. FABRICATORS: Case Summary & 20 Largest Unsecured Creditors
-----------------------------------------------------------------
Debtor: International Fabricators & Erectors, Inc.
        aka American Industrial Machining, LLC
        1710 Southern Road
        Kansas City, Missouri 64120

Bankruptcy Case No.: 04-47993

Type of Business: The Debtor manufactures fabricated metal
                  products.

Chapter 11 Petition Date: December 29, 2004

Court: Western District of Missouri (Kansas City)

Judge: Arthur B. Federman

Debtor's Counsel: Joanne B. Stutz, Esq.
                  Evans & Mullinix, P.A., Suite 200
                  7225 Renner Road
                  Shawnee, Kansas 66217
                  Tel: 913-962-8700
                  Fax: 913-962-8701

Total Assets: $6,152,005

Total Debts:  $6,334,382

Debtor's 20 Largest Unsecured Creditors:

   Entity                     Nature Of Claim       Claim Amount
   ------                     ---------------       ------------
Carpenters Fringe Benefit     Union Benefits            $774,141
Fund
3100 Boroadway
Kansas City, MO 64111

Internal Revenue Service      941 Withholding Taxes     $443,077
Ogden, UT 84201

Missouri Dept. of Revenue     Withholding Taxes -       $151,573
P.O. Box 3375                 Tax lien may have
Jefferson City, MO 65105      been filed but
                              insufficient equity to
                              secure debt

Sedalia Steel Supply, Inc.    Trade Payable              $50,006

Roger Buckman                 Loan                       $45,448

Manager of Finance            Property Taxes/Real        $43,337
                              and Personal

Central Conveyor Company      Trade Payable              $39,500

CBIZ Accounting               Professional               $31,363
                              Services

Kirk Welding Supply, Inc.     Trade Payable              $24,104

City of Kansas City,          Withholding                $22,891
Missouri Revenue Division     earnings tax

Geosystems Engineering        Trade Payable              $22,330

Abresist Corporation          Trade payable              $20,018

Advanced Protective Coatings  Trade Payable              $18,207
Inc.

Brown & Dunn                  Trade Payable              $16,192

Waldeck Matteuzzi & Sloan PC  Trade Payable              $16,192

Iron Workers Fringe Benefit   Union Benefits             $13,740
Program

The Hartford                  Trade Payable              $13,626

Triten Corporation            Trade Payable              $10,992

Lift Truck Sales & Service    Trade Payable              $10,799

Builders Association          Trade Payable              $10,065


LOEWEN GROUP: State Street Wants $224,705 Class 23 Claims Paid
--------------------------------------------------------------
The Fourth Amended Joint Plan of Reorganization of Loewen Group
International, Inc., and its debtor-affiliates and the
Confirmation Order provide for the creation by the Debtors of
segregated accounts, to be funded with cash in the Series Reserve
Amounts aggregating $5.5 million, in order to satisfy State Street
Bank and Trust Company's charging liens under certain Prepetition
Indentures, and to ensure that State Street's charging liens under
the Prepetition Indentures remain in force and effect.  State
Street has accrued those secured claims with respect to the Series
1 Notes, Series 2 Notes, Series 3 Notes and Series 4 Notes during
the period prior to the Effective Date of the Plan.

State Street seeks allowance and payment from the
Series Reserve Amounts with respect to the Series 1 Notes, Series
2 Notes, Series 3 Notes and Series 4 Notes, of its expenses,
including legal fees and expenses, incurred in the period prior to
the Effective Date of the Plan, in these amounts:

    -- Series 1 Notes, $26,538;
    -- Series 2 Notes, $26,538;
    -- Series 3 Notes, $60,296; and
    -- Series 4 Notes, $111,333,

totaling $224,705.

Francis A. Monaco, Jr., at Monzack and Monaco, P.A., in
Wilmington, Delaware, relates that State Street's secured claims
under the Prepetition Indentures include amounts for:

    -- compensation for State Street's services as indenture
       trustee;

    -- reimbursement for State Street's disbursements and
       expenses arising from State Street's services as
       indenture trustee;

    -- fees and expenses of State Street's agents and counsel
       arising from State Street's services as indenture
       trustee; and

    -- indemnification and defense of any past or future loss
       or liability arising from State Street's administration
       of the trusts created under the Prepetition Indentures.

According to Mr. Monaco, a portion of State Street's secured
claims under the Prepetition Indentures with respect to the Series
3 Notes and Series 4 Notes are for legal fees and expenses
incurred in connection with the controversy that arose in the
Debtors' cases relating to the secured status of those notes under
the Collateral Trust Agreement between Loewen and Bankers Trust,
the Collateral Trustee.  However, Mr. Monaco says, all of State
Street's secured claims under the Prepetition Indentures with
respect to the Series 1 Notes and Series 2 Notes, as well as a
portion of State Street's secured claims under the Prepetition
Indentures with respect to the Series 3 Notes and Series 4 Notes,
are for trustee fees and expenses, including legal fees and
expenses, which State Street incurred in providing typical trustee
services, and in fulfilling its obligations under the Prepetition
Indentures, with respect to matters unrelated to the CTA Issue.

Mr. Monaco notes that the Confirmation Order and the Series
Reserve Allocation Order limit the amounts available to State
Street to satisfy its claims under the Prepetition Indentures.
Pursuant to the Series Reserve Allocation Order, the Series
Reserve Amounts are:

    -- Series 1 Notes, $26,538;
    -- Series 2 Notes, $26,538;
    -- Series 3 Notes, $200,296; and
    -- Series 4 Notes, $339,360.

Due to the distinction drawn by the Court between pre-Effective
Date expenses and post-Effective Date expenses, and due to the
allocation methodology adopted by the Court, Mr. Monaco says,
$60,296 of the Series Reserve Amounts from the Series 3 Notes and
$129,360 of the Series Reserve Amounts from the Series 4 Notes are
available to pay State Street's pre-Effective Date expenses,
including legal fees and expenses.

Formerly The Loewen Group, Alderwoods Group is North America's #2
funeral services company.  Alderwoods Group owns or operates about
750 funeral homes and some 170 cemeteries in the US and Canada.
The firm's funeral services include casket sales, remains
collection, death registration, embalming, transportation, and the
use of funeral home facilities.  The Debtors filed for chapter 11
protection in the United States and CCAA protection in Canada on
June 1, 1999 after the Debtors failed to make debt payments after
its aggressive acquisition phase.  Loewen became Alderwoods Group
when it emerged from bankruptcy on January 2, 2002. (Loewen
Bankruptcy News, Issue No. 91; Bankruptcy Creditors' Service,
Inc., 215/945-7000)


LSI LOGIC: Raises 2004 Fourth Quarter Revenue & EPS Guidance
------------------------------------------------------------
LSI Logic Corporation (NYSE: LSI) raised its 2004 fourth quarter
revenue and earnings per share guidance, led by growth of the
company's Storage Systems, Storage Components and Consumer
businesses.

LSI Logic expects to report 2004 fourth quarter revenues in the
range of $415 million to $420 million, compared to the previously
forecasted fourth quarter revenue range of $360 million to $390
million.  The updated 2004 fourth quarter revenue range represents
approximately 10 percent sequential revenue growth over the
company's 2004 third quarter revenues of $380 million.

LSI Logic anticipates reporting a 2004 fourth quarter GAAP net
loss in the range of 53-55 cents per diluted share.  The company
earlier projected a GAAP net loss of 54-57 cents per diluted
share.  The GAAP projection includes the previously announced
estimated $180 million non-cash, asset impairment charge
associated with the company's Gresham manufacturing campus in the
fourth quarter.

The company projects reporting 2004 fourth quarter net income,
excluding special items, in the range of a 1-3 cent profit per
diluted share.  The company earlier expected to report a net loss,
excluding special items, in the range of 2-5 cents per diluted
share.

LSI Logic expects 2004 fourth quarter gross margin in the range of
41-42 percent.  The company earlier projected fourth quarter gross
margin in the range of 41-43 percent.

"The growth of our Storage and Consumer businesses in the fourth
quarter serves as a positive indicator that the inventory
correction in the supply chain is substantially over in these two
markets," said Wilfred J. Corrigan, LSI Logic chairman and chief
executive officer.  "Our Storage Systems subsidiary, Engenio
Information Technologies, Inc., recorded a very strong fourth
quarter.  Our Storage Components business demonstrated broad
strength through growth in storage ASICs, standard products and
RAID storage adapters.  Our Consumer business grew and inventory
in our customer supply chain appears to be under control."

The company will report its 2004 and fourth quarter financial
results, provide its 2005 first quarter business outlook and hold
its quarterly conference call on Wednesday, Jan. 26, 2005.

Milpitas, California-based LSI Logic is a major manufacturer of
application-specific semiconductors, which are custom-designed
for the digital game, communications, and entertainment markets.

                          *     *     *

As reported in the Troubled Company Reporter on Nov. 1, 2004,
Standard & Poor's Ratings Services revised its outlook on
Milpitas, California-based semiconductor manufacturer LSI Logic
Corp. to negative from stable.

In addition, Standard & Poor's affirmed its 'BB-' corporate credit
rating and other ratings on the company. The company had
$1.0 billion of debt and capitalized operating leases at Sept. 30,
2004.


MANUFACTURED HOUSING: S&P's Rating on Class B-1 Debt Slides to D
----------------------------------------------------------------
Standard & Poor's Ratings Services lowered its rating on the
subordinate B-1 class of Manufactured Housing Contract Senior/Sub
Pass-Thru Cert Series 2001-2 to 'D' from 'CC'.

The lowered rating reflects the reduced likelihood that investors
will receive timely interest and the ultimate repayment of their
original principal investment.  This transaction reported an
outstanding liquidation loss interest shortfall for its B-1 class
on the January 2005 payment date.  Standard & Poor's believes that
interest shortfalls for this transaction will continue to be
prevalent in the future, given the adverse performance trends
displayed by the underlying pool of collateral, as well as the
location of B-1 write-down interest at the bottom of the
transaction payment priorities (after distributions of senior
principal).

Standard & Poor's will continue to monitor the outstanding ratings
associated with this transaction in anticipation of future
defaults.


MATRIA HEALTHCARE: Adopted Holding Company Structure on Dec. 31
---------------------------------------------------------------
Matria Healthcare, Inc. (Nasdaq: MATR) reorganized into a holding
company structure effective Dec. 31, 2004.

The primary purpose of the reorganization was to provide the
Company with a more flexible capital structure and to allow for an
organizational structure that is more closely aligned with
Matria's business operations.  The business operations of Matria
Healthcare, Inc., will not change as a result of the holding
company structure.

As part of the reorganization, a new parent company, Matria
Healthcare, Inc., was formed.  The former Matria Healthcare, Inc.,
changed its name to Matria Women's and Children's Health, Inc.,
and is now a wholly-owned subsidiary of the holding company.
Outstanding shares of capital stock of the former Matria
Healthcare, Inc., were automatically converted, on a share for
share basis, into identical shares of common stock of the new
holding company.  The certificate of incorporation, the bylaws,
executive officers and the board of directors of the new holding
company are the same as those of the former Matria Healthcare,
Inc., in effect immediately prior to the reorganization.  The
common stock of the new holding company will continue to trade on
the Nasdaq National Market under the symbol "MATR."  The rights,
privileges and interests of the Company's stockholders will remain
the same with respect to the new holding company.  The change to
the holding company structure was tax free to the Company's
stockholders.

The new holding company assumed the former Matria Healthcare,
Inc.'s obligations under the 11% Senior Notes due 2008 and the
4.875% Convertible Senior Subordinated Notes due 2024.  The former
Matria Healthcare, Inc. will be a guarantor of such notes.

                        About the Company

Matria Healthcare, Inc., is a leading provider of comprehensive
disease management programs to health plans and employers.  Matria
manages the following major chronic diseases and episodic
conditions -- diabetes, cardiovascular diseases, respiratory
diseases, high-risk obstetrics, cancer, chronic pain and
depression. Headquartered in Marietta, Georgia, Matria has more
than 40 offices in the United States and internationally. More
information about Matria can be found on line at
http://www.matria.com/

                          *     *     *

As reported in the Troubled Company Reporter on Aug. 23, 2004,
Standard & Poor's Ratings Services reinstated its 'BB-' senior
secured debt rating on disease-state management and fulfillment
services provider Matria Healthcare Inc.'s $35 million revolving
credit facility due October 2005.

At the same time, Standard & Poor's affirmed its 'B+' corporate
credit rating and its 'B-' subordinated debt rating on Matria's
$84 million of 4.875% convertible senior subordinated notes due in
2024.

Standard & Poor's initially withdrew the senior secured rating
because they believed that the $35 million revolving credit
facility would be refinanced as part of Matria's transaction to
retire $122 million of outstanding 11% senior notes. However,
because the revolving credit facility will remain outstanding,
Standard & Poor's is reinstating the rating.

The outlook is stable.

"The low-speculative-grade ratings on Matria Healthcare, a
disease-state management and fulfillment services provider to
patients, physicians, and health plans, reflect the company's
limited scale of operations, its position as a small vendor
supplying products for larger medical products manufacturers, and
the decline in its women's health segment," said Standard & Poor's
credit analyst Jesse Juliano. "These concerns are offset by the
fact that Matria has acquired businesses during the past few years
that have broadened its clinical infrastructure and disease-state
management platforms. The company is also operating with
relatively moderate debt leverage."


MIRANT: Seeks Tolling Pacts for Two California Generating Units
---------------------------------------------------------------
Mirant's subsidiary, Mirant Americas Energy Marketing, is seeking
proposals for a one-, two- or three-year tolling arrangement for
two of its generating units located near San Francisco,
California:

   -- Pittsburg 7, located in Pittsburg, and
   -- Contra Costa 6, located in Antioch.

Both units are natural-gas fired and connected to the CAISO grid
through transmission owned by PG&E.  Pittsburg 7 generates 682
megawatts; Contra Costa 6 generates 337 megawatts.

All qualified bidders are encouraged to participate according to
the following schedule:

      January 3, 2005    Issuance of Request for Proposal

      January 10, 2005
         4:00 p.m. EPT    Notices of Intent to Bid Due

      January 28, 2005
         4:00 p.m. EPT    Bids Due


Interested parties should contact Kirk Covington at Mirant at
kirk.covington@mirant.com or 678.579.3091.

Headquartered in Atlanta, Georgia, Mirant Corporation --
http://www.mirant.com/-- together with its direct and indirect
subsidiaries, generate, sell and deliver electricity in North
America, the Philippines and the Caribbean. Mirant Corporation
filed for chapter 11 protection on July 14, 2003 (Bankr. N.D. Tex.
03-46590). Thomas E. Lauria, Esq., at White & Case LLP,
represents the Debtors in their restructuring efforts. When the
Debtors filed for protection from their creditors, they listed
$20,574,000,000 in assets and $11,401,000,000 in debts.


MOOG INC: S&P Rates Proposed $120 Million Senior Sub. Notes at B+
-----------------------------------------------------------------
Standard & Poor's Ratings Services raised its ratings on Moog
Inc., including the corporate credit rating to 'BB' from 'BB-'.
At the same time, Standard & Poor's assigned its 'B+' rating to
the aerospace supplier's proposed $120 million senior subordinated
notes due 2015, which will be issued via a drawdown to an existing
$150 million SEC Rule 415 shelf registration.  The outlook is
stable.

"The upgrade reflects improved earnings protection measures,
satisfactory cash generation, modest debt leverage, and the
beginning of a recovery in the commercial aerospace market," said
Standard & Poor's credit analyst Christopher DeNicolo.  Growth in
the military and industrial segments, as well as the contribution
from an acquisition, offset a soft commercial aerospace market in
2003-2004, enabling Moog to maintain generally above average for
the rating financial ratios.  As the proceeds from the proposed
subordinated notes will be used to repay revolver borrowings,
leverage will not change.  The increased liquidity will likely be
used to pursue acquisitions, but the company is expected to
maintain credit protection measures consistent with the new rating
level.

The ratings on Moog, Inc., reflect major positions in niche
markets and generally above average for the ratings financial
measures, but are constrained by the potential for debt-financed
acquisitions and integration risk.  The East Aurora,
New York-based firm serves aerospace and industrial markets,
providing highly engineered motion control systems for critical
applications.  Moog is a major manufacturer of servo valves,
actuators, and regulators used in aerospace flight controls and
industrial processes requiring precision positioning and use of
force.  Competition is significant in all product lines, and
limited pricing flexibility requires ongoing improvements to
operational efficiencies.

Improvements in the commercial aircraft, space, and industrial
markets are likely to offset lower sales related to military
aircraft, in the near term.  Overall, credit protection measures
are expected to be appropriate for current ratings, including the
impact of possible small to mid-sized debt-financed acquisitions.


NATIONAL CENTURY: Trust Objects to R. Parrett's $110 Mil. Claims
----------------------------------------------------------------
Rebecca Parrett was a founder, officer and director of National
Century Financial Enterprises, Inc., and various other Debtors,
and an equity shareholder of NCFE.  Ms. Parrett submitted four
proofs of claim against NCFE:

     Claim No.         Basis for Claim              Claim Amount
     ---------         ---------------              ------------
       679      Declaratory relief related to the    $40,000,000
                Promissory Notes entered into by
                NCFE declaring that no monies are
                owed under the Promissory Note

       680      Fraud in the inducement as it        $10,000,000
                directly relates to employment
                contracts entered into with NCFE

       681      Fraud in the inducement as it        $40,000,000
                directly relates to a certain Loan
                Agreement, and other agreements and
                documents exchanged between the
                parties and approved and ratified
                by NCFE

       682      Conversion of bankruptcy remote      $20,000,000
                entities NPF VI, Inc., and NPF XII,
                Inc.'s funds by NCFE, along with
                conversion by NPF IV and NPF XII
                of NCFE's funds and assets, as
                well as conversion of applicable
                estate assets in a fashion that
                was and continued to be ratified
                and approved by all the Debtors,
                in violation of applicable
                contracts and law, and for the
                appointment of an examiner to
                audit and account for those
                funds, assets and conversion.

The Unencumbered Assets Trust objects to Ms. Parrett's Claims on
four grounds:

    (a) In the absence of supporting documents or adequate
        explanations and computations, the Claims fail to comply
        with Rule 3001 of the Federal Rules of Bankruptcy
        Procedure;

    (b) The Claims are not enforceable under applicable underlying
        state law principles because, without limitation, they are
        subject to equitable defenses of unclean hands, equitable
        estoppel, unjust enrichment, breach of fiduciary duty and
        prior material breach;

    (c) Ms. Parrett is a recipient of transfers from the Debtors
        that are avoidable under Sections 544, 547 and 548 of the
        Bankruptcy Code; and

    (d) The Claims are the claims of an insider and exceed the
        reasonable value of Ms. Parrett's services to the Debtors
        pursuant to Section 502(b)(4) of the Bankruptcy Code.

Sydney Ballesteros, Esq., at Gibbs & Bruns, LLP, in Houston,
Texas, further argues that the Claim No. 679 should be disallowed
because:

    -- a request for declaratory relief concerning some note
       entered into by NCFE is not a "claim" subject to or
       suitable for a proof of claim;

    -- the request appears to concern a note entered into by NCFE,
       not Ms. Parrett, and Ms. Parrett offers no explanation what
       her standing or interest is in this issue; and

    -- no note was attached, nor was a note described in
       sufficient detail to permit the Court, the Debtors or the
       Trust to discern which note Ms. Parrett references, or even
       who the note is allegedly payable to.

Claim No. 680 appears to refer to the employment contracts of
Lance Poulsen and Donald Ayers, each of whom submitted proofs of
claim at or about the same time Ms. Parrett's claim was filed,
based on purported employment contracts each had with NCFE.  To
the extent that Ms. Parrett intends her "proof of claim" to be
simply an objection to those individuals' proofs of claim, the
Trust concurs that it has filed extensive objections to Messrs.
Poulsen and Ayers' claims.  To the extent that Ms. Parrett somehow
considers this a "claim" of her own, Ms. Ballesteros contends that
Ms. Parrett lacks any ownership or standing, and has provided
insufficient explanation or supporting documentation to determine
what right, stake or claims she could have.

Moreover, Claim No. 682 appears to assert, alternatively or
simultaneously, that NCFE "converted" NPF VI and NPF XII, and that
NPF VI or NPF XII "converted" funds or assets from NCFE.  Whatever
the specific nature of the torts of conversion to which Ms.
Parrett refers, Ms. Parrett does not assert that her property was
converted, Ms. Ballesteros avers.

Ms. Ballesteros tells the Court that the Plan has resolved all of
the outstanding claims of NCFE, NPF VI and NPF XII against one
another or against the other various Debtor entities, pursuant to
the Noteholder Deficiency Claim Settlement.

Thus, the Trust asks the Court to disallow Ms. Parrett's claims.

                    Withdrawal of the Reference

Though many of the bankruptcy and procedural issues in the Trust's
Objection do not implicate matters at issue in litigations pending
before Judge Graham in the District Court, and many of the issues
in the Objection may best be administered and resolved by the
Bankruptcy Court, to the extent that particular rulings may affect
or involve specific issues also in dispute in those cases before
Judge Graham, the UAT asks the District Court to withdraw the
reference with respect to those particular issues so that the
discovery and adjudication on those matters may be coordinated by
Judge Graham.

Headquartered in Dublin, Ohio, National Century Financial
Enterprises, Inc. -- http://www.ncfe.com/-- through the CSFB
Claims Trust, the Litigation Trust, the VI/XII Collateral Trust,
and the Unencumbered Assets Trust, is in the midst of liquidating
estate assets.  The Company filed for Chapter 11 protection on
November 18, 2002 (Bankr. D. Ohio Case No. 02-65235).  The Court
confirmed the Debtors' Fourth Amended Plan of Liquidation on
April 16, 2004.  Paul E. Harner, Esq., at Jones Day, represents
the Debtors in their restructuring efforts. (National Century
Bankruptcy News, Issue No. 50; Bankruptcy Creditors' Service,
Inc., 215/945-7000)


NEXTEL PARTNERS: Welcomes Art Harrigan to Board of Directors
------------------------------------------------------------
Nextel Partners, Inc. (Nasdaq:NXTP), the exclusive provider of
Nextel digital wireless communications services in the mid-sized
and rural markets it serves, has added Art Harrigan to its board
of directors.

Mr. Harrigan is a partner at Danielson Harrigan Leyh & Tollefson
LLP, a Seattle-based law firm that specializes in commercial
litigation.  He helped form the firm in 1986.  Prior to forming
Danielson Harrigan Leyh & Tollefson LLP, Mr. Harrigan was a
partner at Lane, Powell, Moss & Miller.  He joined the firm in
1971 and became a partner in 1975.  While at Lane, Powell, Moss &
Miller, he served as head of an eight-lawyer Commercial Litigation
Department.  In 1975, Mr. Harrigan served as senior counsel to the
Senate Select Committee on Intelligence Activities and headed its
investigation of IRS intelligence operations.

Mr. Harrigan was formerly a member of Eagle River Investments,
L.L.C., and is a Fellow of the America College of Trial Lawyers.
He is a graduate of Harvard College and holds a law degree from
Columbia University.

"Art brings a wealth of experience and an understanding of core
issues that are important to Nextel Partners as we continue to
grow," said John Chapple, chairman, chief executive officer and
president of Nextel Partners.  "His leadership experience will go
a long way towards maintaining our role as an industry leader."

                     About Nextel Partners

Nextel Partners, Inc. -- http://www.nextelpartners.com/--  
(Nasdaq:NXTP), based in Kirkland, Wash., has the exclusive rights
to offer the same fully integrated, digital wireless
communications services offered by Nextel Communications (Nextel)
in mid-sized and rural markets in 31 states where approximately 53
million people reside. Nextel Partners and Nextel together offer
the largest guaranteed all-digital wireless network in the country
serving 297 of the top 300 U.S. markets.

                         *    *    *

As reported in the Troubled Company Reporter on Dec. 28, 2004,
Standard & Poor's Ratings Services revised its rating outlook on
Nextel Partners, Inc., to positive from stable. Ratings on the
company, including the 'B+' corporate credit rating, were
affirmed.

"The outlook change reflects the potential exercise of Nextel
Partners' put rights to Nextel Communications Inc. (BB+/Watch
Pos/--) following Nextel Communications' announced merger with
Sprint Corp.," explained Standard & Poor's credit analyst
Rosemarie Kalinowski.


NOTIFY TECHNOLOGY: Losses & Deficit Triggers Going Concern Doubt
----------------------------------------------------------------
Notify Technology Corporation has incurred losses for seven
straight fiscal years:

         Fiscal Year               Net Loss
         -----------               --------
         September 30, 2004        $655,908
         September 30, 2003      $1,100,475
         September 30, 2002      $1,741,752
         September 30, 2001      $3,337,612
         September 30, 2000      $3,526,452
         September 30, 1999      $3,123,284
         September 30, 1998      $2,617,561

and, at Sept. 30, 2004, had an accumulated deficit of $23,076,235
and a working capital deficit of $413,953.

In a regulatory filing with the Securities and Exchange
Commission, Notify Technology Management says it anticipates
having negative cash flow from operating activities in future
quarters and years.  It is also expected that the Company will
incur further operating losses in future quarters and years until
the time, if ever, that there is a substantial increase in orders
for its products and product sales, generating sufficient revenue
to fund its continuing operations.  There can be no assurance that
sales of its products will ever generate significant revenue, that
it will ever generate positive cash flow from its operations or
that it will attain, or thereafter sustain, profitability in any
future period.  Because of Notify Technology's financial condition
and its business plans, the Company's financial statements
disclose that there is substantial Doubt as to the Company's
ability to continue as a going concern and accordingly Notify
Technology's business has a high risk of failure.

The Company recently developed NotifyLink products will need to
attain favorable market acceptance in order for the Company to be
able to continue its research and development activities and to
fund operating expenses at current levels.  Regardless, because
its NotifyLink wireless product line has not provided sufficient
contributions to Company revenues to date, to operate profitably
without the contribution of its Visual Got Mail Solution revenue,
the success of its business operations will depend upon a
significant favorable market acceptance for its new wireless
software products and its ability to obtain further financing.
Obtaining additional financing will be subject to a number of
factors including market conditions, investor acceptance of the
Company's business plan, and investor sentiment.  These factors
may make the timing, amount, terms and conditions of additional
financing unattractive or unavailable to the Company.  If unable
to raise additional financing, the Company will have to
significantly reduce its spending, delay or cancel planned
activities or substantially change its current corporate
structure.  In such an event, Notify Technology intends to
implement expense reduction plans in a timely manner.  However,
these actions would have material adverse effects on its business,
results of operations, and prospects, resulting in a possible
failure of the Company's business.

Notify Technology Corporation was incorporated in the state of
California in August 1994.  It is a software developer of
enterprise mobility solutions for wireless and wireline handheld
devices supporting a variety of email platforms including Novell
GroupWise, Microsoft Exchange, and various IMAP4 email solutions.
Its product links a company email server with employees away from
their office using various handheld wireless devices to manage
their email, calendar appointments and address book.  Its product
allows devices from different manufacturers to operate on the same
system and the use of different network carriers if required.


NQL DRILLING: Appoints Pat Shouldice to Board of Directors
----------------------------------------------------------
NQL Drilling Tools, Inc., (TSX - NQL.A) has appointed Mr. Pat
Shouldice to the Board of Directors of the Company.  Mr. Shouldice
has had a long and distinguished career in the oilfield services
industry, most notably as the founder and Chief Executive Officer
of NOWSCO, a Canadian based pumping and stimulation company that
was sold to BJ Services in 1996. With an original investment of
$30,000, Mr. Shouldice built NOWSCO from a small regional Canadian
contractor, to an international entity operating in over 20
countries, and an ultimate value in excess of $800 million.

The Company is pleased to have the expertise of Mr. Shouldice as
it continues to improve upon its core operations and map out a
longer-term business plan.

NQL Drilling Tools, Inc., is an industry leader in providing
downhole tools, technology and services used primarily in drilling
applications in the oil and gas, environmental and utility
industries on a worldwide basis.  NQL trades on the Toronto Stock
Exchange under the symbol NQL.A.

The Company's September 30, 2004, consolidated financial
statements have been prepared on the basis of accounting
principles applicable to a going concern.  The Company has
experienced adverse conditions and events, which cast doubt upon
the validity of this assumption.


NRG ENERGY: Agrees to Settle Con Edison Claims for $5.8 Million
---------------------------------------------------------------
Consolidated Edison Company of New York, Inc., has filed motions,
objections and proofs of claim related to the assumption of its
leases and contracts entered into with NRG Energy and its debtor-
affiliates.

Pursuant to the NRG Confirmation Order and the Northeast/South
Central Confirmation Order, NRG Energy, Inc., transferred and set
aside in a separate interest-bearing account $12,000,000, to be
used solely for the purpose of reserving the Reserve Amount for
Con Edison.

Furthermore, under the Confirmation Orders, the Debtors have
assumed under Section 365 of the Bankruptcy Code all of their
contracts and leases with Con Edison, subject to the
determination of the cure amounts required under the Bankruptcy
Code.

Pursuant to the assumption of Con Edison's leases and with
respect to the Cure Payments, the Debtors and Con Edison desire
to resolve their dispute without further costs of litigation and
risks.

NRG, Arthur Kill Power LLC, Astoria Gas Turbine Power LLC, NRG
Power Marketing, Inc., and Con Edison have reached an amicable
resolution memorialized in a Settlement and Flexible Rate
Agreement dated March 1, 2004, and a Stipulation regarding the
cure payments required to assume the Debtors' contracts and
leases with Con Edison.

Specifically, the parties agree that:

    (a) The Debtors will pay as a cure payment to Con Edison by
        wire transfer in immediately available funds the aggregate
        cash amount of the Past Period Charges.  As of
        February 29, 2004, the aggregate amount is $5,800,000 plus
        interest;

    (b) All contracts, leases, other agreements and instruments by
        or among any of the Debtors and Con Edison will remain in
        full force and effect and enforceable against those
        Reorganized Debtors that are parties to those agreements;

    (c) Subject to the prior indefeasible receipt by Con Edison of
        the full amount of the Con Edison Cure Payment, Claim Nos.
        281, 288, 1482, 1483 and 3000 will be deemed resolved
        without the requirement of any further action by Con
        Edison; and

    (d) Upon the payment of the Con Edison Cure Payment to Con
        Edison, the Reserve Amount held in the Reserve Account
        will revert back to NRG.

Judge Beatty approves the parties' Stipulation.

The Stipulation excludes claims relating to the A-11 dock area
license agreement dated June 25, 1999, by and between Con Edison
and Astoria Gas, which claims are expressly preserved in the
Debtors' bankruptcy cases in which they were filed and are not
resolved.

NRG Energy, Inc., owns and operates a diverse portfolio of power-
generating facilities, primarily in the United States. Its
operations include baseload, intermediate, peaking, and
cogeneration facilities, thermal energy production and energy
resource recovery facilities. The company, along with its
affiliates, filed for chapter 11 protection (Bankr. S.D.N.Y. Case
No. 03-13024) on May 14, 2003. The Company emerged from chapter
11 on December 5, 2003, under the terms of its confirmed Second
Amended Plan. James H.M. Sprayregen, Esq., Matthew A. Cantor,
Esq., and Robbin L. Itkin, Esq., at Kirkland & Ellis, represented
NRG Energy in its $10 billion restructuring.

                          *     *     *

As reported in the Troubled Company Reporter on Dec. 14, 2004,
Standard & Poor's Ratings Services assigned its 'CCC+' rating to
NRG Energy Inc.'s (NRG; B+/Stable/--) proposed $400 million
convertible perpetual preferred stock. The outlook is stable.

The proceeds of the preferred stock issuance will be used to
redeem a portion of NRG's outstanding second priority notes due
2013.  In addition, NRG will repurchase 13 million shares of
common stock held by investment partnerships managed by
MatlinPatterson Global Advisors LLC using available cash.

NRG, previously a 100% owned subsidiary of Xcel Energy Inc.,
emerged from bankruptcy on Dec. 5, 2003, and has operated for one
year.  It is engaged in the ownership and operation of power
generating facilities, primarily in the U.S. merchant power
market, thermal production and resource recovery facilities, and
various international independent power producers.

"NRG has benefited in the past year from high natural gas prices,
which have allowed it to maintain high gross margins," said credit
analyst Arleen Spangler.  "There is little room for a ratings
upgrade in the near term based on the high business risk of
operating as predominantly a merchant generator where cash flows
may be volatile."


PAW INVESTMENTS: Voluntary Chapter 11 Case Summary
--------------------------------------------------
Debtor: PAW Investments
        1910 East Seltice Way
        Post Falls, Idaho 83854

Bankruptcy Case No.: 04-21896

Chapter 11 Petition Date: December 29, 2004

Court: District of Idaho (Coeur d'Alene)

Judge: Terry L. Myers

Debtor's Counsel: Bruce A. Anderson, Esq.
                  Elsaesser Jarzabek Anderson Marks
                  Elliott & McHugh
                  1400 Northwood Center Court #C
                  Coeur d'Alene, ID 83814
                  Tel: 208-667-2900

Estimated Assets: $0 to $50,000

Estimated Debts:  $1 Million to $10 Million

The Debtor has no unsecured creditors who are not insiders.


PEGASUS SATELLITE: Wants to Abandon Unsold Assets to Lenexa
-----------------------------------------------------------
As part of their restructuring strategy, the Debtors have rejected
effective as of November 30, 2004, a lease with Lenexa Industrial
Park, Inc., dated January 31, 2001.

As previously reported, the United States Bankruptcy Court for the
District of Maine authorized Pegasus Satellite Communications,
Inc. and its debtor-affiliates to employ Garcel, Inc., doing
business as The Great American Group to conduct an auction of
certain personal property of the Debtors.

Robert J. Keach, Esq., at Bernstein, Shur, Sawyer & Nelson, in
Portland, Maine, relates that Great American auctioned the Lenexa
Personal Property.  Certain personal property of the Debtors
included in the Lenexa Personal Property was offered for sale but
was not purchased at the Lenexa Auction and remains at the Lenexa
Facility.  The Lenexa Remaining Personal Property was previously
utilized by the Debtors in their direct broadcast satellite
business.

The Debtors have determined that the Lenexa Remaining Personal
Property is of inconsequential value or burdensome to their
estates.  Therefore, the Debtors want to abandon the Lenexa
Remaining Personal Property to Lenexa Industrial Park, free and
clear of any liens, claims and encumbrances.

By this motion, the Debtors seek the Court's authority to abandon
to Lenexa, the Lenexa Remaining Personal Property, including,
without limitation, furniture, fixtures and equipment that were
utilized by the Debtors at the Lenexa Facility in lieu of
incurring the cost of removing the Lenexa Remaining Personal
Property.

Lenexa has agreed that any costs or expenses it will incur in
removing or disposing of the Lenexa Remaining Personal Property
will be attributed solely to Lenexa.  Lenexa will have no claim
against any of the Debtors or their estates for any costs or
expenses related to the removal or disposal of the Lenexa
Remaining Personal Property.

The Debtors believe that the proposed abandonment procedures
provide an efficient process for disposing of their personal
property that was not sold at the Lenexa Auction.  Mr. Keach
points out that any costs associated with selling the Lenexa
Remaining Personal Property or disposing of or removing them would
outweigh any value that may be attributed to the Lenexa Remaining
Personal Property.

Mr. Keach asserts that because Lenexa has agreed to accept and
retain the Lenexa Remaining Personal Property and dispose of or
remove it at no cost to the Debtors, the Debtors are saving their
estates and creditors money that would otherwise have to be
expended to dispose of assets that have no value to their estates.

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


PENN TRAFFIC: Names Robert Dimond VP & Chief Financial Officer
--------------------------------------------------------------
The Penn Traffic Company (Pink Sheets:PNFTQ) has appointed
supermarket industry finance executive Robert B. Dimond, CPA, as
its new Executive Vice President and Chief Financial Officer,
subject to the approval of the U.S. Bankruptcy Court for the
Southern District of New York.

"We are delighted to have Bob join us as our new Executive Vice
President and Chief Financial Officer," said Bob Chapman,
President and Chief Executive Officer of Penn Traffic.  "Bob's
wealth of experience will be a tremendous contribution to our
organization as we exit chapter 11 and position the company for
long-term growth."

"Appointing Bob Dimond marks another major milestone in our
efforts to reorganize our Company," said Mr. Chapman.  Penn
Traffic also recently announced that it intends to emerge from
chapter 11 in the first quarter of 2005.

Mr. Dimond replaces William B. Murphy, who has been serving as
Penn Traffic's interim CFO.  Mr. Murphy will remain with Penn
Traffic for an unspecified period of time to facilitate the
transition and assist with the restructuring process.

Mr. Dimond joins Penn Traffic with 16 years of experience in
finance and accounting at supermarkets throughout the U.S.  He
served as executive vice president, CFO and treasurer for Nash
Finch Company, a $4 billion supermarket operator and food
distribution company based in Minneapolis, Minnesota.  Previously,
Mr. Dimond was group vice president and CFO for the Kroger Co.
Western Region and served as vice president and controller for
Smith's Food & Drug Centers, Inc.  Mr. Dimond's experience and
responsibilities encompass a wide range of activities including
accounting, tax, financial reporting, budgeting and forecasting,
strategic planning and analysis, and mergers and acquisitions.

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

In December 2004, the Company filed with the Court its First
Amended Plan of Reorganization Disclosure Statement.


PRUDENTIAL SECURITIES: Moody's Rates Four Cert. Classes at Low-B
----------------------------------------------------------------
Moody's Investors Service upgraded five classes, affirmed six
classes and downgraded two classes of Prudential Securities
Secured Financing Corporation, Commercial Mortgage Pass-Through
Certificates, Series 1999-NRF1 as follows:

   -- Class A-1, $14,944,432, Fixed, affirmed at Aaa
   -- Class A-2, $480,307,000, Fixed, affirmed at Aaa
   -- Class A-EC, Notional, Floating, affirmed at Aaa
   -- Class B, $51,092,000, Fixed, upgraded to Aaa from Aa2
   -- Class C, $46,447,000, Fixed, upgraded to Aa2 from A2
   -- Class D, $46,447,000, WAC, upgraded to A3 from Baa2
   -- Class E, $13,935,000, WAC, upgraded to Baa1 from Baa3
   -- Class F, $20,903,000, Fixed, upgraded to Baa3 from Ba1
   -- Class G, $25,546,000, Fixed, affirmed at Ba2
   -- Class H, $9,291,000, Fixed, affirmed at Ba3
   -- Class J, $9,291,000, Fixed, affirmed at B1
   -- Class K, $15,794,000, Fixed, downgraded to B3 from B2
   -- Class L, $6,502,000, Fixed, downgraded to Caa1 from B3

As of the December 15, 2004 distribution date, the transaction's
aggregate balance has decreased by approximately 19.3% to
$750.0 million from $928.9 million at securitization.  The
Certificates are collateralized by 230 mortgage loans secured by
commercial and multifamily properties.  The loans range in size
from less than 1.0% to 8.6% of the pool, with the top 10 loans
representing 30.0% of the pool.  Three loans, representing 1.9% of
the pool, have defeased and have been replaced with U.S.
Government securities.  Six loans have been liquidated from the
pool resulting in aggregate realized losses of approximately
$5.7 million.

Three loans, representing less than 1.0% of the pool, are in
special servicing.  Moody's has estimated aggregate losses of
approximately $700,000 for all of the specially serviced loans.

Moody's was provided with partial year 2004 and year-end 2003
borrower financials for 96.2% of the pool's performing loans.
Moody's loan to value ratio -- LTV -- is 80.0%, compared to 84.7%
at securitization.  The upgrade of Classes B, C, D, E and F is due
to increased subordination levels and improved pool performance.
The downgrade of Classes K and L is due to realized and expected
losses from the specially serviced loans and LTV dispersion.
Based on Moody's analysis, 14.6% of the pool has a LTV greater
than 100.0%, compared to 0.0% at securitization.

The top three loans represent 15.7% of the pool.  The largest loan
is the Three Park Avenue Loan ($64.4 million - 8.6%), which is
secured by a 659,000 square foot office building located in the
East Midtown South submarket of New York City.  Major tenants
include:

   * American Engineers (23.4% NRA; expiration September 2013),
   * Carat USA, Inc. (8.6% NRA; expiration January 2009), and
   * Eaton & Van Winkle (6.7% NRA; expiration June 2009).

The property is 95.0% occupied, essentially the same as at
securitization.  Moody's LTV is 67.9%, compared to 79.4% at
securitization.

The second largest loan is the Tower Shops Loan ($32.4 million
- 4.3%), which is secured by a 373,000 square foot retail center
located in Davie, Florida.   Davie is located approximately 10
miles southwest of Ft. Lauderdale.   Major tenants include
Linens-n-Things, Ross Dress for Less, Office Depot, Old Navy and
T.J. Maxx.  The property is 94.0% occupied, compared to 96.4% at
securitization.  Moody's LTV is 90.6%, compared to 94.0% at
securitization.

The third largest loan is the Louisville Marriott East Loan
($20.7 million - 2.8%), which is secured by a 254-room full
service hotel located in suburban Louisville, Kentucky.  The
property's performance has declined since securitization.  RevPAR
for the year--to-date period ending June 2004 was $71.69, compared
to $76.07 at securitization.  Moody's LTV is in excess of 100.0%,
compared to 79.5% at securitization.

The pool collateral is a mix of:

            * office and mixed use (37.5%),
            * retail (22.8%),
            * multifamily (21.7%),
            * hotel (6.1%),
            * industrial and self storage (5.1%),
            * healthcare (4.9%), and
            * U.S. Government securities (1.9%).

The collateral properties are located in 37 states.  The top five
state concentrations are:

            * New York (14.2%),
            * Florida (10.1%),
            * California (8.5%),
            * Texas (7.8%), and
            * Ohio (6.6%).

All of the loans are fixed rate.


PSYCHIATRIC SOLUTIONS: S&P Revises Ratings Outlook to Stable
------------------------------------------------------------
Standard & Poor's Ratings Services revised its outlook on
Franklin, Tennessee-based behavioral health services provider
Psychiatric Solutions, Inc., to stable from negative.  At the same
time, Standard & Poor's affirmed its 'B+' corporate credit rating
on Psychiatric Solutions and its 'B-' subordinated debt rating on
the company's $100 million in senior subordinated notes due in
2013.

The outlook revision reflects Psychiatric Solutions' sale of
approximately 3.3 million shares of common stock.  Net proceeds to
the company were about $105 million, which Psychiatric Solutions
intends to use to redeem $50 million of its senior subordinated
notes, with the related premium, and to reduce the borrowing under
its senior secured revolving credit facility.  After the
transaction, the company will have outstanding $100 million of
senior subordinated notes, $24 million of mortgage loans and other
debt, and approximately $30 million (or slightly less) borrowed
under the revolving credit facility.

Psychiatric Solutions also increased the size of its revolving
credit facility to $150 million from $125 million, extended its
maturity on the facility by two years to December 2009, and
lowered the interest rate (Standard & Poor's does not rate the
senior secured credit facility).  However, the outlook revision
predominantly reflects the reduction of debt, as well as the
company's improved operating performance since our initial rating
and outlook assignment in 2003. After the anticipated repayment of
Psychiatric Solutions' debt, the company will have about
$155 million of total debt outstanding.

"The low-speculative-grade ratings on Psychiatric Solutions, Inc.,
reflect the risks associated with the company's aggressive
acquisition strategy, such as integration risks, the potential for
incurring additional debt, and the challenge of managing a much
larger entity," said Standard & Poor's credit analyst Jesse
Juliano.  The company is also exposed to potential government
reimbursement changes.  These concerns are partially offset by
Psychiatric Solutions' position as one of the largest providers in
the highly fragmented behavioral health industry, its history of
successful acquisitions since 2003, and its improved capital
structure.

Psychiatric Solutions provides behavioral health programs through
its 34 owned or leased inpatient psychiatric facilities. It has
more than 4,000 licensed beds.  The company also provides
management services for 11 psychiatric inpatient units in
acute-care hospitals and in eight freestanding facilities.

The company has grown considerably via acquisitions in 2003 and
2004.  In the second quarter of 2003, it completed the
acquisitions of Ramsay Youth Services and the Brown Schools,
increasing its total inpatient facilities to 22 from only five.
Since then, the company has acquired 12 additional facilities.


QUIGLEY COMPANY: Caplin & Drysdale Approved as Committee Counsel
----------------------------------------------------------------
The U.S. Bankruptcy Court for the Southern District of New York
gave the Official Committee of Unsecured Creditors of Quigley
Company, Inc., permission to employ Caplin & Drysdale, Chartered
as its counsel.

Caplin & Drysdale will:

   a) assist and advise the Committee in its consultations with
      the Debtor and other committees relative to the
      administration of the Debtor's estates;

   b) represent the Committee at hearings before the Bankruptcy
      Court and communicate with the Committee the matters and
      issues raised and the decisions and considerations of the
      Court;

   c) assist and advise the Committee in its examination and
      analysis of the Debtor's conduct and financial affairs;

   d) review and analyze all applications, orders, operating
      reports, schedules and statements of affairs filed by the
      Debtor and other parties in interest with the Court;

   e) assist the Committee in preparing appropriate legal
      pleadings and proposed orders and prepare witnesses and
      review documents related to those pleadings and orders;

   f) coordinate the receipt and dissemination of information the
      Committee receives from the Debtor's independent certified
      accountants and professionals;

   g) assist the Committee in the solicitation and filing with the
      Court for any proposed plan of reorganization;

   h) assist and advise the Committee with regards to
      communications to the asbestos-related claimants regarding
      the Committee's efforts, progress and recommendations of
      their claims in relation for any proposed plan of
      reorganization; and

   i) provide the Committee with other legal services that may be
      appropriate and necessary and in the best interest of the
      creditors.

Elihu Inselbuch, Esq., a Member at Caplin & Drysdale, is the lead
attorney for the Committee.  Mr. Inselbuch will charge $780 for
his services.

Mr. Inselbuch reports Caplin & Drysdale's professionals bill:

    Professional               Designation       Hourly Rate
    ------------               -----------       -----------
    Peter Van L. Lockwood      Partner              $685
    Walter B. Slocombe         Counsel               560
    Albert G. Lauber           Counsel               540
    Julie W. Davis             Counsel               520
    Trevor W. Sweet, III       Counsel               520
    Robert C. Spohn            Paralegal             180
    Andrew D. Katznelson       Paralegal             160
    Tracy L. Wantuck           Paralegal             150
    Ada I. Odum                Paralegal             150

Caplin & Drysdale assures the Court that it does not represent any
interest adverse to the Committee, Debtor or its estate.

Headquartered in Manhattan, Quigley Company is a subsidiary of
Pfizer, Inc., which used to produce and market a broad range of
refractories and related products to customers in the iron, steel,
glass and other industries.  The Company filed for chapter 11
protection on Sept. 3, 2004 (Bankr. S.D.N.Y. Case No. 04-15739) to
resolve legacy asbestos-related liability.  When the Debtor filed
for protection from its creditors, it listed $155,187,000 in total
assets and $141,933,000 in total debts.  Pfizer has agreed to
contribute $405 million to an Asbestos Claims Settlement Trust
over 40 years through a note, contribute approximately $100
million in insurance, and forgive a $30 million loan to Quigley.
Michael L. Cook, Esq., at Schulte Roth & Zabel LLP, represents the
Company in its restructuring efforts.


RAYOVAC CORP: S&P Places Low-B Ratings on CreditWatch Negative
--------------------------------------------------------------
Standard & Poor's Ratings Services placed its ratings on Rayovac
Corp. and United Industries Corp., including its 'B+' corporate
credit ratings, on CreditWatch with negative implications.

The CreditWatch listing follows Rayovac's announcement that it has
reached an agreement to acquire United Industries Corp. for
$1.2 billion including the assumption of $880 million of United
Industries' debt.  As part of the transaction, Rayovac will issue
13.75 million shares of its common stock, enter into a new
$1.2 billion senior secured credit facility, issue $500 million of
senior subordinated notes, and contribute $70 million in cash.

About $880 million of United Industries debt will be redeemed or
replaced as a result of the transaction, which is expected to
close in February 2005.  If the transaction is completed as
currently contemplated, corporate credit, bank and subordinated
debt ratings on United Industries will be withdrawn upon
refinancing.  At Sept. 30, 2004, Rayovac had about $830 million of
debt outstanding.

"We will assess Rayovac's new capital structure, product portfolio
diversity, scale, and integration risk as key factors in
determining the effect of the acquisition on its ratings.  The
ratings would not likely be lowered more than one notch as a
result of the transaction," said Standard & Poor's credit analyst
Patrick Jeffrey.

Atlanta, Georgia-based Rayovac is a leading global consumer
products company in the battery, shaving and grooming, and
lighting categories.  Its brands include: Rayovac, Varta, and
Remington, with products available in 120 countries.

St. Louis, Missouri-based United Industries, operating as Spectrum
Brands, is a manufacturer and marketer of consumer lawn and garden
pesticides (including herbicides), indoor and outdoor
insecticides, insect repellents, fertilizers, and soils.  United
Industries is also a leading manufacturer of premium branded pet
supplies.


REI TRUST: Fitch Withdraws 'BB+' Rating on $375 Mil. 7.20% Trust
----------------------------------------------------------------
Fitch Ratings withdrew the 'BB+' rating and Stable Rating Outlook
for the REI Trust I $375 million 7.20% trust originated preferred
securities.  The rating withdrawal reflects the full redemption of
these securities on Dec. 24, 2004.  REI Trust I is a special
purpose subsidiary created by CenterPoint Energy, Inc. (CNP; rated
'BBB-' by Fitch, senior unsecured, Stable Outlook) for the sole
purpose of issuing the securities and purchasing junior
subordinated debentures issued by CNP.


RELIANCE GROUP: Settles $2.8 Million Wrongful Death Action Claims
-----------------------------------------------------------------
M. Diane Koken, Insurance Commissioner for the Commonwealth of
Pennsylvania, as Liquidator of Reliance Insurance Company, asks
the Commonwealth Court for permission to enter into a Settlement
Agreement with Travelers Casualty and Surety Company and
Plaintiffs:

   * Rachel McBride, Next of Kin, Heir and Administratrix of the
     Estate of Larry McBride, Deceased, Individually and Wrongful
     Death Beneficiary of Larry McBride, Deceased; and

   * James Johnson, April Martin (nee Johnson), Jenna Johnson,
     Marlene Johnson and Julie Johnson, all heirs-at-law of
     Matthew Johnson, Deceased.

RIC issued Business Auto Policy No. NKA 2222 290 to Classic
Coach, Inc., effective July 21, 1993, to July 21, 1994.  The
Policy provided for supplementary payments, including payment of
post-judgment interest, in addition to policy limits.  In May
2000, Travelers acquired a certain portion of RIC's surety and
fidelity business.

Plaintiffs' decedents, Larry McBride and Matthew Johnson, died
from injuries sustained in a motor vehicle accident with a bus
owned by Classic Coach and operated by its employee, Albert Rush,
Sr.  The Plaintiffs filed separate Wrongful Death Actions in the
Circuit Court of Tunica County, Mississippi against Classic Coach
and Mr. Rush.  The Actions were consolidated and tried, with
final Judgments in favor of the McBrides for $1,872,000 and the
Johnsons for $1,440,000.  The Judgments were against Classic
Coach and Mr. Rush.

RIC defended Classic Coach and Mr. Rush in the Wrongful Death
Actions and pursued an appeal of the Judgments to the Mississippi
Supreme Court.  In connection with the appeal, RIC issued two
appeal bonds:

   1) Bond No. B2680689 for $2,340,000 connected to the McBride
      Judgment; and

   2) Bond No. B2680695 for $1,800,000 connected to the Johnson
      Judgment.

During the appeal process, RIC was placed into liquidation.  On
August 21, 2002, the Mississippi Supreme Court affirmed in part,
reversed in part and remanded the Judgments to the Circuit Court
of Tunica County.  On February 27, 2003, the Circuit Court of
Tunica County awarded the Johnsons $1,380,169, plus interest and
the McBrides $1,794,220, plus interest.

On May 30, 2003, the Plaintiffs asked the Circuit Court of Tunica
County to enforce the Bonds, naming RIC, Travelers Casualty &
Surety Company of America, Inc., Travelers Property Casualty
Company Corp., Travelers Casualty and Surety Company and
Citigroup, Inc., as respondents.  The Plaintiffs alleged that the
Bonds should be enforced against the Travelers Entities because
RIC transferred the Bonds as part of the surety and fidelity
business sale in May 2000.  The Action was removed to the United
States District Court for the Northern District of Mississippi
and stayed.

Travelers asked for arbitration in the Commonwealth Court.  The
McBrides filed Claim No. 2082552, the Johnsons filed Claim No.
1906547 and Travelers filed Claim No. 2058791, each against the
RIC estate.

Shortly thereafter, negotiations commenced.  Jerome R. Richter,
Esq., at Blank Rome, in Philadelphia, Pennsylvania, tells the
Commonwealth Court that after several months of arm's-length
discussions, the parties have reached an Agreement.

The Liquidator agrees that McBride's Claim No. 2082552 will be
allowed for $1,565,556 and Johnson's Claim No. 1906547 will be
allowed for $1,204,274.  Both Claims will be assigned Priority
Level (b).  The Liquidator agrees that Travelers' Claim No.
2058791 will be disallowed.  The Plaintiffs will assign their
Claims to Travelers.  The Liquidator will acknowledge the
assignments and will make any distributions or payments connected
to the McBride or Johnson Claims directly to Travelers.  The
Plaintiffs and Travelers will fully release and discharge RIC,
Classic Coach and Mr. Rush from all potential liabilities and
obligations.  The Plaintiffs will dismiss with prejudice the Bond
Action in the United States District Court for the Northern
District of Mississippi.  The Plaintiffs will file a Satisfaction
of Judgment and Cancellation of Appeal Bonds with the Circuit
Court of Tunica County, Mississippi.  Travelers will withdraw
with prejudice its request for arbitration in the Commonwealth
Court.

Mr. Richter asserts that the Settlement is in the best interests
of the estate.  In light of the substantial claims and defenses,
RIC determined that the risks of litigation were outweighed by
the potential reward.  The result achieved by the Settlement is
fair and reasonable.  Dismissal of the various actions will
result in substantial cost savings to the estate and releases of
liability.

The Agreement does not become effective until approved by the
United States Bankruptcy Court for the Southern District of New
York.  The Liquidator is preparing to seek approval of the
Agreement in that Court.

Headquartered in New York, New York, Reliance Group Holdings, Inc.
-- http://www.rgh.com/-- is a holding company that owns 100% of
Reliance Financial Services Corporation. Reliance Financial, in
turn, owns 100% of Reliance Insurance Company. The holding and
intermediate finance companies filed for chapter 11 protection on
June 12, 2001 (Bankr. S.D.N.Y. Case No. 01-13403) listing
$12,598,054,000 in assets and $12,877,472,000 in debts. The
insurance unit is being liquidated by the Insurance Commissioner
of the Commonwealth of Pennsylvania. (Reliance Bankruptcy News,
Issue No. 66; Bankruptcy Creditors' Service, Inc., 215/945-7000)


RITE AID: Offering $200 Million Senior Notes to Repay 2015 Notes
----------------------------------------------------------------
Rite Aid Corporation (NYSE:RAD)(PCX:RAD) plans to offer
$200 million of 10-year senior secured notes due 2015.  Rite Aid
intends to use the net proceeds from the offering, together with
available cash, to repay at maturity its 7.625% senior notes due
April 2005 and its 6.0% fixed-rate senior notes due December 2005.
Until the stated maturity dates, Rite Aid intends to use the net
proceeds from this offering to repay temporarily borrowings under
its revolving credit facility and obligations under its accounts
receivable securitization program.

The offering is subject to market and other customary conditions.

The notes due 2015 will be offered in the United States to
qualified institutional buyers pursuant to Rule 144A under the
Securities Act of 1933, as amended, and outside the United States
pursuant to Regulation S under the Securities Act.  The notes have
not been registered under the Securities Act and may not be
offered or sold in the United States without registration or an
applicable exemption from the registration requirements.

                        About the Company

Rite Aid Corporation is one of the nation's leading drugstore
chains with annual revenues of $16.6 billion and approximately
3,400 stores in 28 states and the District of Columbia.

                          *     *     *

As reported in the Troubled Company Reporter on Nov. 25, 2004,
Fitch Ratings initiated coverage of Rite Aid Corporation,
assigning a 'B-' rating to its $1.7 billion senior unsecured
notes, a 'B' rating to the company's $800 million senior secured
notes, and a 'B+' rating to the company's $1.4 billion bank
facility. The Rating Outlook is Stable.

The ratings reflect Rite Aid's improving operating performance,
strengthened debt profile, and positive industry fundamentals.
The ratings also recognize the company's limited financial
flexibility, the competitive operating environment, and industry
pricing pressures. The ratings on Rite Aid's secured bank
facility and senior secured notes reflect their first and second
priority liens, respectively, on the company's assets.


ROCKY MOUNTAIN: Receiver Initiates Distribution of Funds
--------------------------------------------------------
Joe Kendall, the Receiver of Rocky Mountain Energy Corporation,
Inc., has initiated a process for distributing recovered funds.
Mr. Kendall directs creditors and shareholders to visit
http://www.rmecreceivership.comfor information about how to
recover their losses.

Mr. Kendall tabulates that approximately 8.4 million shares were
sold to at least 163 shareholders for $0.22 per share.  The
Receiver's proposed distribution plan will allow for 30% recovery
by shareholders.

On April 3, 2003, in the United States District Court for the
Southern District of Texas, the United States Securities and
Exchange Commission  filed a civil action against Rocky Mountain
Energy Corporation and its directors -- John N. Ehrman, W.
Roderick Johnson and John W. Ehrman.  The SEC alleged that the
defendants issued false and misleading statement via a press
release dated July 2, 2002, regarding a proposed acquisition of an
oil and gas company.

On that same date, the District Court issued several orders which,
among other things, temporarily restrained and enjoined the above
defendants from continuing allegedly fraudulent activities, froze
all accounts and assets for the above names defendants and
appointed Receiver Joe Kendall to obtain and marshal those
accounts and assets.

On April 15, 2003, the District Court ordered that the temporary
restraining orders of the defendants be converted to preliminary
injunctions.


SATCON TECHNOLOGY: Auditors Raise Going Concern Doubts
------------------------------------------------------
SatCon Technology Corporation (Nasdaq:SATC), received a going
concern opinion from its auditors contained in its Form 10-K for
the fiscal 2004 fourth quarter and year-end, which ended Sept. 30,
2004, filed with the Securities and Exchange Commission.

Revenues for the 12 month period ending September 30, 2004
increased by 27% from $26.9 million in fiscal 2003 to $34.2
million for fiscal 2004.  Backlog was up 20% to $24 million, the
highest quarterly backlog reported since the Company began
reporting quarterly backlog data about two years ago.  The Company
decreased its operating losses from $26 million in fiscal 2003 to
$4 million in fiscal 2004.  The Company also raised $8 million in
cash through an equity financing.

David Eisenhaure, Chairman and Chief Executive Officer, stated:
"We are well-positioned to realize our goal of double digit
revenue growth in fiscal 2005.  We have one of the strongest
backlogs in the history of our Company and a much improved balance
sheet and the recent financing will enable us to capitalize on new
opportunities.  I am particulary encouraged by the continued
interest and growing prospect pipeline for our Power Systems
products including both our Rotary UPS systems and our high power
inverter products for both photovoltaic and fuel cell
applications."

The Company has historically incurred losses and used cash, rather
than provided cash, from operations.  The Company currently has a
line of credit agreement which expires on March 1, 2005, and
contains certain restrictive covenants.

                        About the Company

SatCon Technology Corporation -- http://www.satcon.com/--  
manufactures and sells power Control products for critical
military systems, alternative energy applications and in high-
reliability industrial automation. Products include inverter
electronics from 5 kilowatts to 5 megawatts; power switches; and
hybrid microcircuits for industrial, medical, military and
aerospace applications. SatCon also develops and builds digital
power electronics and high-efficiency machines and control systems
for a variety of defense applications.


SENECA GAMING: S&P Revises Outlook on Low-B Ratings to Negative
---------------------------------------------------------------
Standard & Poor's Ratings Services revised its outlook on casino
operator Seneca Gaming Corp. to negative from stable.

At the same time, Standard & Poor's affirmed its ratings on the
Niagara Falls, New York-based company, including its 'BB-'
corporate credit rating.  Total lease-adjusted debt was about
$485 million as of September 2004.

As reported in the Troubled Company Reporter on Apr. 23, 2004,
Standard & Poor's Ratings Services assigned its 'BB-' rating to
the Seneca Gaming Corporation's $225 million senior unsecured
notes due 2012.

In addition, a 'BB-' corporate credit rating was assigned to the
Niagara Falls, New York-based company.

The outlook revision reflects:

   (1) the delay in the filing of Seneca Gaming's 2004 10-K,

   (2) the departure of its board of directors and the appointment
       of a new board, and

   (3) uncertainty regarding the scope and outcome of a review of
       Seneca Gaming by an independent council appointed by the
       Seneca Indian Nation of New York -- the Nation.

The new board appointments at Seneca Gaming, as well as the
appointment of an independent council to conduct a review of all
actions taken in the building, financing, management and operation
of the Nation's gaming facilities, followed the election of a new
President of the Nation.  The delayed 10-K filing followed, and
resulted from, the appointment of the new board.

"If operating performance remains good, and if the company is able
to satisfactorily resolve its governance issues over the
intermediate term, Standard & Poor's would consider an outlook
revision back to stable," said Standard & Poor's credit analyst
Emile Courtney.


SPIEGEL INC: Court Approves MBIA & BNY Claims Settlement
--------------------------------------------------------
The Honorable Cornelius Blackshear of the U.S. Bankruptcy Court
for the Southern District of New York gave Spiegel, Inc., and its
debtor-affiliates authority to enter into a settlement agreement,
dated December 3, 2004, made by and among:

   (a) the Spiegel Parties:

      * Spiegel, Inc.,
      * Newport News, Inc.,
      * Eddie Bauer, Inc.,
      * Spiegel Catalog, Inc.,
      * Spiegel Catalog Services, LLC,
      * Spiegel Credit Corporation III,
      * Spiegel Acceptance Corporation,
      * First Consumers National Bank,
      * Michael Crusemann,
      * Horst Hansen,
      * Martin Zaepfel,
      * Michael Otto,
      * Spiegel Holdings, Inc.,
      * Otto (GmbH & Co KG);

   (b) The Bank of New York, as Trustee under the Master
       Indenture, dated December 1, 2000, between the Spiegel
       Credit Card Master Note Trust and the Trustee, including
       the Series 2000-A Supplement, and Series 2001-A Supplement
       to the Master Indenture; and

   (c) MBIA Insurance Corporation.

                       Settlement Agreement

In November 2004, the parties reached agreement on the terms of a
settlement.  To save the time and expense that would result from
litigating the District Court Case and the Securities Litigation,
and objecting to the MBIA Claims and the Trustee Claims, the
Spiegel Parties, the Trustee and MBIA and the other parties have
elected to enter into the settlement agreement.

The salient terms of the Settlement Agreement are:

A. Distribution of the February 2003 Collections

    On the settlement effective date, Bank of New York will
    disburse $14,800,000 from the February 2003 Collections to the
    Note Trust for distribution to the Series 2000-A and 2001-A
    Noteholders.  Within two business days after 94 days after
    the Effective Date, Bank of New York will disburse the
    remainder of the February 2003 Collections plus any
    accrued interest to SAC, except that if SAC becomes
    subject -- voluntarily or involuntarily -- to any
    bankruptcy proceeding during the 94-Day Period, then,
    within two business days, Bank of New York will disburse the
    Remaining February 2003 Collections to the Note Trust for
    distribution to the Series 2000-A and 2001-A Noteholders.

B. Distribution of Seller Interest Account Portion to SAC

    The Seller Interest Account contains the VFN Cash Collateral
    Amount and the Seller Interest portion of the monthly
    allocation from the finance charge portion of the Receivables,
    which in the aggregate exceed $30,100,000, representing
    finance charges being held in the Seller Interest Account.
    Bank of New York will disburse $16,600,000 to SAC from the
    Seller Interest Account.

C. MBIA Settlement Trust

    On the Effective Date, all amounts remaining in the Seller
    Interest Account after the $16,600,000 payment to SAC will be
    transferred to a trust that will be created pursuant to a
    "MBIA Settlement Trust Agreement".  In addition to the
    remainder of the Seller Interest Account, the MBIA Settlement
    Trust assets will include all future monthly cash receipts
    from the Note Trust and the Collateral for the Notes --
    including Receivables -- SAC's interest and SCC III's
    interest, if any, in the Seller Interest, the Collateral and
    any other interest in the Note Trust -- including any interest
    in the Note Trust, including any interest in certain spread
    accounts.

D. MBIA Settlement Trust Assets

    The MBIA Settlement Trust Agreement provides, among other
    things, that the MBIA Settlement Trust's assets will be
    distributed to MBIA pursuant to the priority set forth in the
    Settlement Agreement on account of the MBIA Expenses, the MBIA
    Future Expenses, interest on those expenses, and refused
    claims and returned claims.  SAC or its successor will hold a
    residual interest in the Trust Assets.

E. MBIA Claims Treatment

    On the entry of the Final Court Order, the Debtors or other
    parties-in-interest is deemed to acknowledge that:

    (a) Prepetition Claims continue to accrue in the Debtors'
        Chapter 11 case and are at $48,861,586, as of November 15,
        2004.  The Claim constitutes an allowed prepetition claim
        against the Debtors; and

    (b) The Postpetition Claim constitutes an allowed $8,000,000
        administrative claim.

    In the event that the Settlement Agreement does not become
    effective or no transfer of funds occurs pursuant to the terms
    of the Settlement Agreement, the Debtors will have the right
    to object to and otherwise contest the claims.  Upon
    completion of the transfer of funds to the Note Trust and the
    releases by MBIA becoming effective, MBIA will have absolutely
    and unconditionally waived its right to payment from the
    Debtors on account of the MBIA Claims.

F. Mutual Releases

    The Settlement Agreement provides for certain waivers and
    releases by the parties, including, inter alia:

    (a) Release by MBIA of the Debtors and their subsidiaries and
        affiliates, from any and all manner of claims, provided,
        however, that:

        -- the release will not be effective and will be of no
           force and effect if SAC becomes subject, voluntarily or
           involuntarily, to any bankruptcy proceeding during the
           94-Day Period; and

        -- the release by MBIA of the Released Claims against FCNB
           will be effective on the Effective Date;

    (b) Releases by the Spiegel Parties, including the Debtors, of
        MBIA, the Trustee and CMS, and their subsidiaries and
        affiliates, from any and all manner of claims; and

    (c) MBIA will seek dismissals, with prejudice, of the District
        Court Case and its Appeal of the Securities Litigation
        after the 94-Day Period.

Headquartered in Downers Grove, Illinois, Spiegel, Inc. --
http://www.spiegel.com/-- is a leading international general
merchandise and specialty retailer that offers apparel, home
furnishings and other merchandise through catalogs, e-commerce
sites and approximately 560 retail stores. The Company filed for
Chapter 11 protection on March 17, 2003 (Bankr. S.D.N.Y. Case No.
03-11540). James L. Garrity, Jr., Esq., and Marc B. Hankin, Esq.,
at Shearman & Sterling, represent the Debtors in their
restructuring efforts. When the Company filed for protection from
its creditors, it listed $1,737,474,862 in assets and
$1,706,761,176 in debts. (Spiegel Bankruptcy News, Issue No. 36;
Bankruptcy Creditors' Service, Inc., 215/945-7000)


STELCO INC: Binding Offers Due by January 31, 2005
--------------------------------------------------
Stelco, Inc., (TSX:STE) issued an update on the Company's
Court-approved capital raising process for its core integrated
steel business.

Six parties demonstrated their interest in participating in this
process by submitting detailed proposals by the December 31, 2004,
deadline.  All six parties have been selected to advance to Phase
Two of the process.  Their proposals will be considered together
with the previously approved "stalking horse" commitment provided
by Deutsche Bank.

Phase Two includes the conduct of due diligence and the submission
of binding offers.  Bidders will have access to a secure
electronic data room containing relevant business, financial and
legal information.  They will have reasonable access to Stelco
management and will be provided with tours of the Company's
facilities.  And they will be requested to submit binding offers
on or by January 31, 2005.  The offers will then be evaluated and
negotiated by the Stelco Board, its financial adviser UBS, and the
Chief Restructuring Officer in consultation with the Monitor.
Court approval will be required before any proposed transaction
agreement becomes binding.

Hap Stephen, Stelco's Chief Restructuring Officer, said, "We're
very pleased with the level of interest and commitment shown by
the parties that are advancing to the next phase of our capital
raising process.  The presence of seven strong bidders makes for a
vigorous process and reflects the positive manner in which Stelco
and its prospects are viewed.  We look forward to an outcome that
provides the best possible result for all our stakeholders."

The Company indicated that it will refrain from announcing the
identity of the bidders, discussing terms of the proposals that
have been received, or engaging in speculation as the process is
continuing.

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


TEMBEC INC: Restructuring Five Sawmills in Northeastern Ontario
---------------------------------------------------------------
Tembec, Inc., reports a major restructuring that will affect five
of its sawmills in the Northeastern Ontario region.

Tembec believes that this restructuring plan combined with wood
reallocation, as well as Domtar's plans for its Elk Lake and
Chapleau mills which were announced simultaneously, will allow
Tembec to secure its operations and jobs in the region of
Northeastern Ontario.

The highlights of Tembec's announcement are:

   -- Tembec will cease sawmill operations at its Kirkland Lake
      mill on March 4, 2005, and will invest, in a partnership
      with Domtar, over $9 million to transform the mill into a
      value-added centre for the manufacturing of finger-jointed
      lumber, with a start-up date scheduled for the end of 2005.
      The centre will create between 70 and 92 jobs, compared to
      43 at the normal rate of sawmill production.  Tembec will
      manage and operate the plant. The employees from the sawmill
      will be integrated into the new value-added centre.

   -- Tembec's Chapleau mill will add a third shift and its annual
      production will increase to 147,000 mfbm from 111,000 mfbm
      at present.  Tembec will also be acquiring the boiler and
      kiln operations associated with Domtar's Chapleau sawmill.
      The number of positions associated with this production
      increase is estimated to be 49.

   -- Tembec's Opasatika mill will shut down its operations
      permanently as of March 4, 2005.  This closure will affect
      78 employees.

   -- Tembec's Hearst mill will add a third shift and its annual
      production will increase to 155,000 mfbm from 105,000 mfbm
      at present.  The number of employees at the sawmill will
      increase from 165 to approximately 202.

   -- The announced restructuring will also bring greater
      stability to the Tembec Kapuskasing sawmill and 124 existing
      jobs will be secured at that mill.  Tembec was facing
      downtime in the Hearst, Opasatika and Kapuskasing facilities
      that may now be reduced or avoided.

"The lumber industry is currently facing numerous challenges,"
said Jim Lopez, President of the Tembec Forest Products Group.
"The economic context is tough considering the exchange rate of
the Canadian dollar, the softwood lumber dispute between Canada
and the United States, and the energy costs in Ontario.  We are
also forecasting future fibre reductions in both quality and
quantity.  All totalled, we have no other option but to adapt and
make the right choices which are fewer more efficient large mills
that are capable of attracting capital investment.  These changes
will stabilize and secure the future of these facilities,"
continued Mr. Lopez.  "Tembec, its employees, the various levels
of government and the lumber industry in general all need a
strong, flourishing industry that will provide stable employment
and continue to generate wealth in our communities.  For this
reason, we have to make the necessary decisions, no matter how
difficult they are.  We need efficient, sustainable and stable
sawmills that are able to compete in an increasingly global and
competitive market.  With this restructuring, Tembec will be in a
better position to make the proper investment in ensuring the
future of these operations."

Mr. Lopez indicated that Ontario's Minister of Natural Resources,
David Ramsay, had been consulted on the restructuring proposal and
supported it as a means of strengthening the remaining sawmills.
At meetings in each of the sawmills affected by the announcement,
employees and union leaders were informed of the Company's
decisions and discussed the situation with management.  The
Company has committed to minimize the impact caused by the
restructuring and offered to cooperate with union employee
representatives and management personnel in meeting that
objective.

Tembec, Inc. -- http://www.tembec.com/-- is an integrated forest
products company well established in North America and France,
with sales of approximately $4 billion and some 11,000 employees.
Tembec's common shares are listed on the Toronto Stock Exchange
under the symbol TBC.

                         *     *     *

As reported in the Troubled Company Reporter on Dec. 22, 2004,
Standard & Poor's Ratings Services lowered its long-term corporate
credit and senior unsecured ratings on Tembec, Inc., and its
subsidiary, Tembec Industries, Inc., to 'B' from 'BB-'.  The
outlook is currently stable.


TEMBEC INC: Moody's Pares Ratings to B2 & Says Outlook is Stable
----------------------------------------------------------------
Moody's Investors Service downgraded the senior implied, senior
unsecured and issuer ratings of Tembec Inc.'s key operating
subsidiary, Tembec Industries, Inc., to B2 from Ba3.  The outlook
was changed to stable from negative.

Moody's also reduced Tembec's Speculative Grade Liquidity rating
to SGL-4 from SGL-3.  The SGL-4 rating indicates weak liquidity.
Earlier this year, Tembec's results were showing improvement,
reversing a prior trend that included periodic negative cash flow.
However, with the recent sharp depreciation of the US dollar,
Tembec's near term cash flow is now expected to be weak.  The
rating reductions are warranted by uncertainties concerning the
magnitude and sustainability of the commodity price recovery,
previously noted pressure from increased pension contributions,
and near term liquidity facility maturities that, in the event of
non extension / refinance, would leave Tembec in a vulnerable
position.

Ratings downgraded:

   * Senior implied rating: to B2 from Ba3
   * Issuer rating: to B2 from Ba3
   * Senior unsecured notes and debentures: to B2 from Ba3
   * Speculative Grade Liquidity Rating: to SGL-4 from SGL-3

Outlook changed:

   * Tembec Industries, Inc.: to Stable from Negative

While Tembec is headquartered in Canada and reports in Canadian
dollars, significant proportions of its output are traded in US
dollars and Euros.  Moody's estimates that 70%-to-80% of revenue
is implicitly or explicitly US dollar denominated.  Tembec does
however, benefit from natural hedges.  Moody's estimates that
20%-to-30% of Tembec's costs are effectively US dollar
denominated, with some manufacturing capacity located in the
United States, and as well, with certain cost inputs being priced
in US dollars.  In aggregate, Moody's estimates that a 1>
strengthening of the Canadian dollar - eg. to C$1.00=US$0.81 from
C$1.00=US$0.80 - reduces EBITDA by C$35 million.  At the same
time, with 95% of its C$1.6 billion debt denominated in US
dollars, the same 1> strengthening of the Canadian dollar causes a
C$14 million reduction in debt.  Clearly, the natural hedges do
not fully off-set the impact on revenue translation.  While
Moody's expects pulp and paper pricing to improve modestly over
the next several quarters, solid wood and building products
pricing are susceptible to retreat from recent highs.
Consequently, it does not appear that Tembec can rely on commodity
price increases to off-set the impact of exchange rate migration.
Moody's therefore expects Tembec to initiate significant actions
to address this matter.  Three such actions have already been
announced.  It is unlikely however, that the impact of such
actions will completely negate the exchange rate dynamic.
Similarly, while many observers point to US dollar denominated
commodity prices increasing in response to the cost-push that
currency exchange rate migration causes, Moody's is of the view
this occurs only over time, and only when market conditions are
sufficiently strong so as to absorb higher prices.  Given current
market conditions, it is not clear this cost-push factor will have
a significant impact over the next several quarters.  In
summation, Moody's considers Tembec's ability to service its debt
load to have been impaired by the exchange rate migration.
Consequently, the company's long term debt ratings have been
reduced to B2.

The SGL downgrade results from two key aspects of Moody's
liquidity assessment methodology:

     i) Tembec's two key revolving credit facilities both mature
        within the next few months; and

    ii) the SGL methodology assumes these are not renewed.

Given this, Moody's estimates show the company's cash flow from
operations may not be sufficient to meet all requirements over the
next four quarters.  Tembec has strong relationships with its bank
lenders and a good record of being able to roll its credit
facilities for successive terms.  Moody's therefore expects the
company will be able to renew its credit facilities without
significant difficulty.  However, while:

     i) it may be likely that the credit facilities will be
        renewed;

    ii) Tembec can monetize derivative financial instruments or
        other assets to generate cash flow; and

   iii) the company may benefit from the return of over
        C$220 million of softwood lumber duties,

Moody's methodology characterizes the company's circumstance as
evidencing weak liquidity.

It should be noted that SGL ratings are inherently more volatile
than long-term debt ratings.  Whereas Moody's attempts to ensure
that long term debt ratings are valid on a "through-the-cycle"
basis, SGL ratings are expected to change far more frequently.
Should the facilities be renewed and should certain other positive
factors unfold, the SGL rating could be improved.

Tembec experienced negative FCF in 2002, 2003 and 2004 (pre-sales
of derivative instruments).  Given uncertainty concerning the
magnitude and sustainability of the commodity price recovery, at
exchange rates in the 80>-to-82> range, Tembec will have to
initiate significant actions to prevent 2005 from being FCF
negative.  While there are uncertainties concerning expected 2005
performance, Tembec likely has the requisite operational
flexibility to adapt so that performance and debt protection
measures settle out at levels commensurate with the B2 rating.
Accordingly, the outlook is stable.

Over time, ratings and outlook upgrades are not expected unless
Tembec engages in material debt reduction and implements more
conservative acquisition and financial policies.  Lower ratings
could result from either or both of renewed weakness in commodity
prices (or equivalently, further significant and sustainable
strengthening in the Canadian dollar) and debt-financed
acquisition activity that would cause Moody's to view average
through-the-cycle RCF/Debt as being significantly less than 10%
with the commensurate FCF/Debt being significantly less than 5%.

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


TEV INVESTMENT: List of its 11 Largest Unsecured Creditors
----------------------------------------------------------
TEV Investment Properties, LLC released a list of its 11 Largest
Unsecured Creditors:

Entity                                 Claim Amount
------                                 ------------
Appraisal Services                          $13,600
Attn: Steve Holcombe
1223 - 2nd Avenue North
Columbus, MS 39701

Mitchell, McNutt & Sams                      $9,881
Attn: David Sanders, Esq.
215 - 5th Street North
Columbus, MS 39701

Clark Engineers                              $6,875
Attn: Larry Clark
2411 Hwy. 45 North
Columbus, MS 39705

Hulett Painting                              $4,390

Johnson Carpet                               $3,333

New Home Building Stores                     $3,297

Kenneth Dale Hagood                          $2,140

State Pest Control                           $1,794

Quality Pool and Spa                         $1,596

Lighting Unlimited                             $564

Refrigeration Supply Company                   $440

Headquartered in Columbus, Mississippi, TEV Investment Properties,
LLC, filed for chapter 11 protection (Bankr. N.D. Miss. Case No.
04-17998) on December 16, 2004.  Craig M. Geno, Esq., at Harris &
Geno, PLLC, represents the Company in its restructuring efforts.
When the Debtor filed for protection from its creditors, it
estimated assets and debts of more than $1 Million.


TORPEDO SPORTS: Symbol Returns to TPDO Following Filing of Reports
------------------------------------------------------------------
Torpedo Sports USA, Inc. (OTCBB:TPDO) has filed its Annual Report
on Form 10-KSB for the fiscal year ended July 31, 2004, and its
Quarterly Report on Form 10-QSB for the first fiscal quarter ended
Oct. 31, 2004.  As a result of these filings, the Over the Counter
Bulletin Board has removed the appended "E" from its stock symbol
effective Jan. 4.

The Company also said it is exchanging the final documentation
necessary to complete its previously announced acquisition of
Interactive Games, Inc., a developer and licensor of interactive
casino technologies and slot machine games to the rapidly growing
Native American Class II, Class III and charitable gaming markets.
The Companies are working to close the acquisition by mid-January
subject to satisfactory execution of the remaining documentation.

Torpedo Sports USA, Inc., formerly operated through its wholly
owned subsidiary, Torpedo Sports, Inc., of Quebec, Canada, as a
manufacturer and distributor of outdoor recreational products for
children.  The Company recently announced it has signed a
definitive agreement to acquire Interactive Games, Inc., a
developer and licensor of interactive casino technologies and slot
machine games.

At Oct. 31, 2004, Torpedo Sports' balance sheet showed a
$4,131,108 stockholders' deficit.


TOWER AUTOMOTIVE: Closes New $50 Million Securitization Facility
----------------------------------------------------------------
Tower Automotive (NYSE:TWR) has obtained a $50 million accounts
receivable securitization facility through GE Commercial Finance.
The facility, which closed on Dec. 30, is a critical component of
Tower Automotive's strategy to offset the adverse impact to its
short-term liquidity from the termination of the early payment
programs at certain of the company's North American automotive OEM
customers.  Upon closing, Tower Automotive received net proceeds
of approximately $44 million.

As part of that strategic plan, Tower Automotive has worked with
its customers to find additional solutions to deal with the
elimination of the early payment programs.  Additionally, Tower
Automotive will continue to pursue a European factoring facility,
and expects to complete this later in the first quarter of 2005.

As previously announced on December 3, 2004, Tower Automotive
deferred the dividend payment of approximately $4.4 million on the
6-3/4% trust convertible preferred securities issued by the Tower
Automotive Capital Trust that would have otherwise been paid on
December 31.  Deferring those payments and obtaining the accounts
receivable securitization facility improves the company's short-
term liquidity position and helps bring liquidity in line with its
projections for December 31, 2004 that the company outlined in its
third-quarter earnings review.

Tower Automotive, Inc., -- http://www.towerautomotive.com/-- is a
global designer and producer of vehicle structural components and
assemblies used by every major automotive original equipment
manufacturer, including BMW, DaimlerChrysler, Fiat, Ford, GM,
Honda, Hyundai/Kia, Nissan, Toyota, Volkswagen and Volvo.
Products include body structures and assemblies, lower vehicle
frames and structures, chassis modules and systems, and suspension
components.

                          *     *     *

As reported in the Troubled Company Reporter on Nov. 24, 2004,
Moody's Investors Service placed all of the debt ratings
pertaining to Tower Automotive, Inc., and its wholly owned
subsidiary R.J. Tower Corporation on review for possible
downgrade.  Moody's additionally affirmed Tower's weak SGL-4
speculative grade liquidity rating.

These ratings were placed on review for possible downgrade:

   -- B1 rating for RJ Tower's $425 million of guaranteed first-
      lien senior secured credit facilities, consisting of:

      * $50 million revolving credit facility due May 2009;

      * $375 million term loan B due May 2009;

   -- B2 rating for RJ Tower's $155 million guaranteed second-lien
      senior secured synthetic letter of credit term loan
      facility;

   -- B3 rating for RJ Tower's $258 million of 12% guaranteed
      senior unsecured notes due June 2013;

   -- B3 rating for RJ Tower's Euro 150 million of 9.25%
      guaranteed senior unsecured notes due August 2010;

   -- Caa3 rating for Tower Automotive Capital Trust's
      $258.75 million of 6.75% guaranteed trust convertible
      preferred securities due June 2018;

   -- B2 senior implied rating for Tower; and

   -- Caa2 senior unsecured issuer rating for Tower.

Tower's $125 million of unguaranteed convertible senior unsecured
debentures at the holding company level are not rated by Moody's.


TUCSON ELECTRIC: Fitch Affirms Low-B Bond Ratings
-------------------------------------------------
Fitch Ratings affirmed Tucson Electric Power Company's -- TEP --
ratings:

     -- First mortgage bonds 'BB+';
     -- Second mortgage bonds 'BB+';
     -- Unsecured revenue bonds 'BB-';

The Rating Outlook is Stable.

TEP's ratings are unaffected by Saguaro Utility Group L.P.'s
(Saguaro) Dec. 30, 2004, termination of its proposed acquisition
of the utility's direct corporate parent, UniSource Energy
Corporation -- UNS.  As part of the merger termination, UNS paid
Saguaro $7 million to cover expenses associated with the merger.

The current ratings are consistent with TEP's existing credit
profile, which did not assume any merger benefits.  The ratings
reflect TEP's weak interest coverage ratios, highly leveraged
balance sheet, and high business risk associated with the absence
of a power cost adjustment clause and rate cap (through 2008)
under its 1999 industry restructuring settlement agreement.  The
ratings also consider the utility's competitive, primarily coal-
fired generating capacity and assume that management will continue
to use projected free cash flow (i.e., operating cash flow after
capital expenditures and dividends) to reduce debt.  The primary
concern for TEP fixed income investors is the potential for a rate
reduction in TEP's pending rate review by the Arizona Corporation
Commission.


UAL CORPORATION: Taps Pachulski Stang to Pursue Preference Actions
------------------------------------------------------------------
UAL Corporation and its debtor-affiliates are in litigation to
recover payments made to creditors within 90 days of the Petition
Date.  The Debtors need to retain another law firm because the
general counsel, Kirkland & Ellis, and the other retained law
firms, have conflicts of interest that prevent them from
representing the Debtors in the recovery of Transfers.

By this application, the Debtors seek to employ Pachulski, Stang,
Ziehl, Young, Jones & Weintraub, nunc pro tunc, to December 1,
2004.  Pachulski will serve as bankruptcy litigation counsel to
file and prosecute a limited number of avoidance actions where
Kirkland & Ellis and other counsel are precluded from
representing the Debtors due to conflicts of interest.

Pachulski has extensive experience and knowledge in the field of
debtors' and creditors' rights and business reorganizations under
Chapter 11 of the Bankruptcy Code.  Pachulski handles many
matters similar to those contemplated in the engagement.

Pachulski will be paid on an hourly basis, plus reimbursement of
necessary expenses.  The principal attorneys and paralegals
expected to represent the Debtors and their current hourly rates
are:

                   Laura D. Jones         $595
                   Andrew W. Caine        $475
                   Steven J. Kahn         $430
                   Sandra McLamb          $255
                   Marlene Chappe         $135

The professional services Pachulski will render to the Debtors
include:

  1) provide legal advice on the Litigation Matters;

  2) prepare necessary pleadings and commence and prosecute the
     Litigation Matters for the Debtors;

  3) appear in Court to prosecute the Litigation Matters and
     protect the Debtors' interests; and

  4) perform all other legal services for the Debtors as
     necessary.

James H.M. Sprayregen, Esq., at Kirkland & Ellis, in Chicago,
asserts that Pachulski does not hold or represent any interest
adverse to the Debtors' estates and is a "disinterested person"
as defined in Section 101(14) of the Bankruptcy Code.

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


US AIRWAYS: 64% of Attendants Ratify $94 Million Cost-Savings Pact
------------------------------------------------------------------
January 5, 2005 / PR Newswire

US Airways' cabin attendants, represented by the Association of
Flight Attendants, ratified a $94 million annual cost-savings
agreement.  The agreement passed by a 64 percent margin, and will
now be presented to the bankruptcy court for approval.

"This was an enormously important vote at a critical time for our
company, and we welcome our flight attendants for their continued
participation in US Airways' transformation," said Bruce Ashby, US
Airways senior vice president of alliances and president of US
Airways Express, who headed negotiations for the company.  "We now
need to reach agreements with our machinists, fleet service
workers and maintenance training specialists represented by the
International Association of Machinists."

Additionally, US Airways reached an agreement with both the
committee representing its current retirees, as well as the IAM
for its retirees.  As a result, retirees will retain an agreed
upon level of medical coverage.

US Airways has ratified agreements with the Air Line Pilots
Association, Communications Workers of America and the three units
of the Transport Workers Union.  Negotiations continue with the
IAM's mechanics and related, fleet service workers, and
maintenance training specialists.

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: Creditors Committee Retains Giuliani Capital
--------------------------------------------------------
Elizabeth Borow, managing director of Giuliani Capital Advisors
LLC, advises the U.S. Bankruptcy Court for the Eastern District of
Virginia that Ernst & Young, LLP, recently reached an agreement
with Giuliani Partners, LLC, and the Managing Directors of Ernst &
Young Corporate Finance, LLP, to transfer, on November 30, 2004,
all of its equity ownership in EYCF to Giuliani Partners and the
MDs.  As a result, effective December 1, 2004, EYCF became a
subsidiary of Giuliani Partners and changed its name to Giuliani
Capital Advisors.

The Official Committee of Unsecured Creditors appointed in the
chapter 11 cases of US Airways, Inc., and its debtor-affiliates
retain Ernst & Young Corporate Finance, LLC, and on a
sub-contractual basis, Ernst & Young, LLP, and Taurus FC, LLC, to
serve as financial advisors, effective as of September 23, 2004.

EYCF represented the Creditors' Committee and the
Post-Confirmation Committee in the Debtors' prior bankruptcy
proceedings.

On the Creditors' Committee's behalf, Giuliani will:

   (a) analyze the Debtors' business plans, cash flow
       projections, restructuring programs, and other reports or
       analyses to advise the Committee on the viability of the
       continuing operations and the reasonableness of
       projections and underlying assumptions;

   (b) assist and advise the Committee and its counsel in the
       development, evaluation and documentation of any plans of
       reorganization or strategic transactions;

   (c) analyze the financial effects of the transactions and
       other motions, including new financings, amendments of
       existing financings, assumption/rejection of contracts,
       asset sales, management compensation, retention and
       severance plans;

   (d) analyze the Debtors' current financial position;

   (e) analyze the Debtors' internally prepared financial
       statements and related documentation, to evaluate the
       Debtors' actual performance compared with projected
       results;

   (f) attend and advise at meetings with the Committee, its
       counsel, other financial advisors and the Debtors;

   (g) render testimony as required for the Committee; and

   (h) provide other services, as requested by the Committee.

Giuliani Partners is a privately owned advisory firm founded in
2002 by Rudolph Giuliani, the former mayor of New York City, and
is headquartered in New York City.  Giuliani Partners provides
crisis management, business consulting, financial management,
crisis communications consulting, threat assessment, security
consulting, and litigation settlement advisory services to public
and privately held companies.

Ms. Borow assures Judge Mitchell that Giuliani Capital Advisors
does not hold nor represent any interest materially adverse to the
Committee in the matters for which it has been retained.  Giuliani
Capital Advisors continues to be a disinterested person under the
applicable sections of the Bankruptcy Code.

Judge Mitchell authorizes the Creditors Committee to retain Ernst
& Young Corporate Finance, now known as Giuliani Capital Advisors,
effective as of September 23, 2004.

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


W.R. GRACE: Asbestos PD Committee Objects to Disclosure Statement
-----------------------------------------------------------------
The Official Committee of Asbestos Property Damage Claimants
asserts that the Disclosure Statement of W.R. Grace & Co., and its
debtor-affiliates is short on understandable explanations of
critical aspects of the Plan and replete with omissions that are
necessary to allow creditors to determine how to vote or challenge
the Plan.

The PD Committee cites mischaracterizations, omissions, and
objections in the Disclosure Statement's provisions on:

    -- Asbestos Trust Aggregate Fund
    -- the claims and interests affected by the Plan
    -- Zonolite Attic Insulation
    -- the Debtors' Asbestos-Related Litigation
    -- Asbestos Personal Injury Litigation
    -- Asbestos Property Damage Litigation
    -- Litigation Related to Zonolite Attic Insulation
    -- The Settling Federal Agencies' Consent Decree
    -- Environmental Insurance Litigation
    -- Fraudulent Transfer Litigation
    -- State Income Tax Claims
    -- Estimated Insurance Recoveries
    -- Preservation of Causes of Action
    -- Core Business Value of the Reorganized Debtors and Non-
       Debtor Affiliates
    -- Montana Grand Jury Investigation
    -- Motion for Entry of Case Management Order
    -- The Canadian Proceedings
    -- Class 5 - Intercompany Claims
    -- Class 6 - Asbestos PI-SE Claims
    -- Class 7 - Asbestos PI-AO Claims
    -- Class 8 - Asbestos PD Claims
    -- Class 9 - General Unsecured Claims
    -- Corporate Governance of the parent and Other Debtors
    -- The Asbestos Trust
    -- Contracts
    -- Retention of Jurisdiction
    -- Miscellaneous Provisions
    -- Votes Required for Class Acceptance
    -- Cramdown

A matrix showing the multitudinous deficiencies of the Disclosure
Statement, as pointed out by the PD Committee, is available at no
charge at:


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

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 Company and its
debtor-affiliates 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, Young, Jones & Weintraub, represent the Debtors in
their restructuring efforts.  (W.R. Grace Bankruptcy News, Issue
No. 77; Bankruptcy Creditors' Service, Inc., 215/945-7000)


W.R. GRACE: Future Representative Says Plan is Unconfirmable
------------------------------------------------------------
David T. Austern, the legal representative for future asbestos
claimants, believes that the Disclosure Statement of W.R. Grace &
Co., and its debtor-affiliates should not be approved because the
proposed Plan is patently unconfirmable as a matter of law.

Contrary to the Debtors' position, present asbestos claims are
impaired under the Plan.  By channeling the asbestos claims to a
trust, precluding recoveries against any other parties,
liquidating the claims in a manner other than in the tort system,
and limiting recoveries to fixed fund, the Plan and the
Plan- related motions would alter the legal and equitable rights
of asbestos claimants.  Thus, Asbestos Personal Injury Claimants
are impaired and are entitled to vote on the Plan.  Moreover, even
if the Court determined that asbestos claims are unimpaired, the
deemed acceptance concept of Section 1126(f) of the Bankruptcy
Code does not apply in the context of a Section 524(g) Plan, and
an actual, affirmative vote is required to satisfy Section 524(g).

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 Company and its
debtor-affiliates 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, Young, Jones & Weintraub, represent the Debtors in
their restructuring efforts.  (W.R. Grace Bankruptcy News, Issue
No. 77; Bankruptcy Creditors' Service, Inc., 215/945-7000)


WACHOVIA BANK: S&P Places Low-B Ratings on Six Certificate Classes
------------------------------------------------------------------
Standard & Poor's Ratings Services assigned its preliminary
ratings to Wachovia Bank Commercial Mortgage Trust's $2.1 billion
commercial mortgage pass-through certificates series 2005-C16.

The preliminary ratings are based on information as of
Jan. 4, 2005.  Subsequent information may result in the assignment
of final ratings that differ from the preliminary ratings.

The preliminary ratings reflect:

   (1) the credit support provided by the subordinate classes of
       certificates,

   (2) the liquidity provided by the trustee,

   (3) the economics of the underlying loans, and

   (4) the geographic and property type diversity of the loans.

Classes A-1, A-2, A-3, A-4, A-5, A-6, A-J, B, C, and D are
currently being offered publicly.  Standard & Poor's analysis
determined that, on a weighted average basis, the pool has a debt
service coverage -- DSC -- of 1.51, a beginning LTV of 95.6%, and
an ending LTV of 85.1%.

                  Preliminary Ratings Assigned
            Wachovia Bank Commercial Mortgage Trust

           Class         Rating           Amount ($)
           -----         ------           ----------
           A-1           AAA              81,380,000
           A-2           AAA             654,046,000
           A-3           AAA              49,660,000
           A-4           AAA              69,421,000
           A-5           AAA              84,457,000
           A-6           AAA             711,789,000
           A-J           AAA             131,545,000
           B             AA               56,744,000
           C             AA-              25,793,000
           D             A                33,531,000
           E             A-               20,635,000
           F             BBB+             25,793,000
           G             BBB              20,634,000
           H             BBB-             28,373,000
           J             BB+               2,579,000
           K             BB                7,738,000
           L             BB-              10,317,000
           M             B+                5,159,000
           N             B                 5,158,000
           O             B-                5,159,000
           P             N.R.             33,531,240
           X-P*          AAA           1,989,472,000**
           X-C*          AAA           2,063,442,240**
           EH            N.R.              2,997,070
           TO            N.R.                498,974

                   *      Interest-only class
                   **     Notional amount
                   N.R. - Not rated


WARNER CHILCOTT: Moody's Junks $750M Senior Subordinated Notes
--------------------------------------------------------------
Moody's Investors Service assigned ratings to Warner Chilcott
Company, Inc., and several related entities (B2 senior implied; B2
secured bank credit facilities; Caa1 senior subordinated notes;
SGL-3).

Moody's is assigning these ratings in connection with the
leveraged buyout -- LBO -- of Warner Chilcott PLC, a public
limited company organized under the laws of Northern Ireland.  The
buyout is to be funded with approximately $2.0 million of new debt
and $1.3 billion of equity supplied by investment funds affiliated
with Bain Capital Partners, DLJ Merchant Banking Partners, J.P.
Morgan Partners, and Thomas H. Lee Partners in the form of common
and preferred stock.  The common and preferred stock will be
issued by Warner Chilcott Holdings Company III, Limited, which is
the 100% owner, indirectly, of Warner Chilcott.

Positive credit factors reflected in the B2 rating include:

   (1) Warner Chilcott's niche portfolio of successful
       pharmaceutical products;

   (2) its targeted focus on women's health and dermatology;

   (3) its history of generating consistent free cash flow as a
       public company; and

   (4) its strong senior management team, which Moody's expects
       will be retained after the transaction.

Moody's believes that most of the company's product acquisitions
made during the past several years have been successful based on
rising script trends and product sales, and that the outlook for
most core products remains favorable.  In addition, the company
has been successful to date in operating without patent protection
for some products (Ovcon, Doryx and Estrace Cream), and has
implemented various strategies to extend and protect these product
franchises.  Like other pharmaceutical companies, Warner Chilcott
enjoys high gross margins on its products, and its tax rate
benefits from substantial operations in low-tax jurisdictions
including Puerto Rico.

The primary negative factor included in the rating is the
company's very high level of debt relative to its cash resources
and free cash flow, and relative to other specialty pharmaceutical
companies rated by Moody's.  Pro forma for the LBO, Moody's
estimates free cash flow to adjusted debt in the range of 3-5%,
stemming primarily from high interest costs, capital expenditures
and contingent payments to third parties.

Moody's anticipates that Warner Chilcott's $200 million
acquisition of Bristol-Myers Squibb Company's U.S. sales and
marketing rights to Dovonex will occur in 2006, to be funded
through the delayed draw credit facility.  The final milestone
payment of $40 million for the exclusive license of Dovobet could
occur in 2006, although this product is still subject to
regulatory approval.  Though Warner Chilcott may introduce line
extensions on certain products, other opportunities in the
pipeline appear somewhat limited, and Moody's believes the company
may be reliant on continuing its strategy of in-licensing products
to expand its portfolio.

Other concerns reflected in the B2 rating include:

   (1) the inability to fully rule out generic competition for
       products without patent protection, and

   (2) industry-wide risks affecting the pharmaceutical sector,
       for which Moody's currently maintains a negative rating
       outlook.

These risks include:

   (1) intense competition,
   (2) exposure to patent expirations,
   (3) the risky nature of new product development, and
   (4) a challenging regulatory environment.

In addition, within the specialty pharmaceutical sector, several
companies have been affected by unexpected excess inventory levels
at drug wholesalers, which led to substantial reductions in
revenue and cash flow and recent credit rating downgrades.
Industry-wide changes in the wholesaler contracting model and
limited visibility into the actual levels of wholesaler inventory
contribute to this risk factor.

Moody's is also assigning a speculative grade liquidity rating of
SGL-3 to Warner Chilcott, primarily reflecting its limited levels
of cash on hand, free cash flow, and capacity under revolving
credit facilities relative to its high debt levels.

The bank credit facilities will consist of:

     (i) $1.25 billion in term loans, comprised of $900 million to
         be issued by Warner Chilcott Company, Inc. (a Puerto Rico
         entity),

    (ii) $150 million to be issued by Warner Chilcott Holdings
         Company III, Limited (a Bermuda entity), and

   (iii) $200 million to be issued by Warner Chilcott Corporation
          (a U.S. entity);

    (iv) a $150 million revolving credit facility expected to be
         undrawn at close; and

     (v) a $240 million delayed draw credit facility.

Guarantees are provided by the borrowers, U.S. subsidiaries and
foreign subsidiaries, and security consists of a first-priority
pledge of all assets of the borrowers, and all current and future
domestic subsidiaries.  The primary operating entity is the Puerto
Rico entity -- i.e. Warner Chilcott Company, Inc. -- which also
holds most of the intellectual property assets.  Moody's
anticipates standard financial covenants including net debt/EBITDA
and interest coverage ratios.

Moody's is rating the bank facilities at the same level as the
senior implied rating based on the high proportion of bank debt in
the capital structure, and the high level of intangible assets.

The B3 issuer rating is one notch below the senior implied rating,
reflecting its unsecured position in the capital structure.  The
Caa1 rating on the subordinated notes reflects their subordinated
position relative to any senior unsecured debt.  The subordinated
notes will be guaranteed by the same entities guaranteeing the
bank facilities.

The rating outlook is stable.  Over time, Warner Chilcott's
ratings could be raised if product sales materialize as projected
the company reduces debt such that free cash flow to adjusted debt
appears comfortably sustainable in excess of 5%.  Conversely,
lower ratings could ensue if product sales falter after the LBO,
or if the company increases its debt levels greater than the
growth in cash flow.

Ratings assigned to Warner Chilcott Company, Inc.

   * B2 senior implied rating

   * B2 senior secured bank credit facility of $900 million due
     2012

   * B2 senior secured revolving credit facility of $150 million
     due 2011

   * B2 senior secured delayed draw credit facility of
     $240 million

   * SGL-3 speculative grade liquidity rating

   * B3 issuer rating

Ratings assigned to Warner Chilcott Corporation:

   * B2 senior secured bank credit facility of $200 million due
     2012

   * Caa1 senior subordinated notes of $750 million due 2015

Rating assigned to Warner Chilcott Holdings Company III, Limited:

   * B2 senior secured bank credit facility of $150 million due
     2012

The Company is a marketer and developer of branded pharmaceutical
products focused on the U.S. women's healthcare and dermatology
markets and reported $490 million in revenues in for the fiscal
year ended September 30, 2004.


WARNER CHILCOTT: S&P Rates Proposed $1.64B Sr. Sec. Debt at B
-------------------------------------------------------------
Standard & Poor's Ratings Services assigned a 'B' corporate credit
rating to Warner Chilcott Corp. -- WCC.  WCC is a holding company
that is purchasing U.K. firm Warner Chilcott PLC, a specialty
pharmaceutical maker of women's health and dermatology products.

At the same time, Standard & Poor's assigned ratings to a series
of debt offerings, part of which WCC will use to fund the
acquisition.

Standard & Poor's assigned a 'B' rating to WCC's proposed
$1.64 billion senior secured credit facility. (This consists of a
$150 million revolving credit facility due 2011, a $1.25 billion
term B loan due 2012, and a delayed-draw $240 million term loan.)
A recovery rating of '2' was assigned to the senior secured
facility, as Standard & Poor's believes lenders can expect a
substantial recovery of principal in the event of a default.
Standard & Poor's also assigned a 'CCC+' subordinated debt rating
to WCC's $750 million in senior subordinated notes due 2015.

The $150 million revolving credit facility is expected to be
undrawn at the close of the acquisition of Warner Chilcott. The
$240 million delayed-draw term loan is earmarked to help finance
the planned acquisition of the U.S. sales and marketing rights to
psoriasis treatment Dovonex from Bristol-Myers Squibb Co. in early
2006.

"The low-speculative-grade ratings on WCC reflect the heavy debt
load being incurred to consummate the acquisition of Warner
Chilcott," said Standard & Poor's credit analyst Arthur Wong. The
rating will also benefit, however, from WCC's diverse product
portfolio following the acquisition.

Warner Chilcott has built solid franchises in both the women's
health and dermatology markets, and the company's portfolio is
relatively diversified.  Though Dovonex will become the new
company's top seller after it is purchased in 2006, it will still
account for only 23% of sales.  Six other products -- Ovcon,
Estrostep, femhrt, Estrace Cream, Sarafem, and Doryx -- will each
contribute 10%-12% of sales.

Warner Chilcott has obtained all of its major franchises through
acquisitions, and the company's management, which will essentially
stay the same after the acquisition, has a solid track record of
increasing sales for these products once they are in the stable.
Women's health accounts for nearly 60% of Warner Chilcott's annual
sales.  The company competes in the branded oral contraceptives
market with Ovcon and Estrostep and in the hormone replacement
therapy category with femhrt and Estrace Cream.


* ABA Bench & Bar Bankruptcy Conference is in March in Washington
-----------------------------------------------------------------
The American Bar Association Judicial Division is holding its
inaugural Bench & Bar Bankruptcy Conference on March 10 to 12,
2005, at the Mandarin Oriental Washington, D.C., for federal and
state judges and attorneys focused on bankruptcy issues.

The conference offers continuing legal education or judicial
education credits in related topics, including potential liability
for deepening insolvency, valuation, trial tactics, and ethics.
State court judges benefit from a separate one-day program track
suited specifically to their interests.

Attendees will enjoy luncheons featuring keynote speakers Judge
Marjorie O. Rendell (U.S. Court of Appeals, Third Circuit) and
Professor Jonathan Turley (George Washington University School of
Law).

Registration for Bench & Bar Bankruptcy Conference is now open at
http://www.abanet.org/jd/bankruptcy/register.htmlwith an early
registration discount of $100 before Jan. 24, 2005.  Conference
registration entitles one to attend a reception and dinner at the
Supreme Court of the United States.

For a complete program overview, visit the conference website at
http://www.abanet.org/jd/bankruptcyor register online today at
http://www.abanet.org/jd/bankruptcy/register.htmlor call
800-238-2667 ext. 5147.

This program is sponsored by the ABA Judicial Division National
Conference of Federal Trial Judges, Lawyers Conference and
National Conference of State Trial Judges, National Conference of
Bankruptcy Judges, the American Bar Association Section of
Business Law and Section of Litigation.


* Bob Iommazzo Joins NachmanHaysBrownstein as Managing Director
---------------------------------------------------------------
Robert J. Iommazzo has joined NachmanHaysBrownstein, Inc., as
Managing Director of its New York Office, and can be contacted at:

          Robert J. Iommazzo
          NachmanHaysBrownstein, Inc.
          Olympic Tower, 645 Fifth Avenue, 8th Floor
          New York, NY 10022
          Phone: 212-848-0203
          Fax: 212-751-3512
          E-mail: riommazzo@nhbteam.com

Bob Iommazzo comes to NachmanHaysBrownstein Inc., from his former
position as Managing Principal of Cornerstone Consulting Group
LLC.  For over thirty years, he has provided restructuring,
management advisory and turnaround services to private and
publicly held companies.  Bob is an accomplished problem solver
with hands-on experience in managing businesses through
challenging times.

As President and CEO of a successful publicly held giftware
business, Bob raised funds through a private placement to finance
acquisitions, and quadrupled revenues.  Key to his success were
the development of new product lines and completion of several
acquisitions.  Bob also served as President and CEO of Papel
Freelance, a $35 million subsidiary of publicly held Russ Berrie &
Co. (NYSE: RUS), restoring its profitability through internal
improvements as well as pursuit of new market opportunities.

During Bob Iommazzo's prior career in consulting, he spent 20
years as a Partner with Coopers & Lybrand (now
PricewaterhouseCoopers).  His client engagements included public
and private corporations in the U.S. and abroad, and featured
arranging financing (including for start-ups) and focused on the
manufacturing, distribution, pharmaceutical and financial service
industries.  His clients included Johnson & Johnson, Bank of
Boston, Volvo and Russ Berrie & Co.

More recently, Bob has provided restructuring services to
Roadhouse Grill Inc., a $150 million publicly traded restaurant
chain.  He guided the company through the bankruptcy
reorganization process, and assisted it in emerging from
bankruptcy in only four months, fending off a hostile takeover in
the process.  He has also restructured and liquidated a home
health care company, and restructured a construction maintenance
and restoration company and provided financing alternatives.

Bob Iommazzo has been featured widely as a speaker.  He is a
graduate of Fairleigh Dickinson University where he majored in
accounting.  He received his CPA in 1972, but subsequently retired
it and does not practice accounting or auditing.  He has served on
many nonprofit boards, and was chairman of the March of Dimes
North Jersey Chapter.  He also was a First Lieutenant in the Army
National Guard.

Bob Iommazzo's experience providing services in turnaround
management, restructuring, bankruptcy proceedings, due diligence,
cash management, divestitures, and profit improvement makes him a
leader in the field, and a key member of the NHB team.

NachmanHaysBrownstein, Inc. -- http://www.nbteam.com/-- is one of
the country's leading turnaround and crisis management firms,
having been included among the "Top Twelve Turnaround Firms" in
Turnarounds & Workouts for the past nine consecutive years. NHB
has its headquarters near Philadelphia and has offices in New
York, Boston, Atlanta, Washington and Wilmington.


* Dewey Ballantine Elects Five Local Partners in European Offices
-----------------------------------------------------------------
Dewey Ballantine LLP, a leading international law firm, elected
six new members of the firm, and appointed five local partners in
its European offices effective Jan. 1, 2005.  The firm also
appointed three lawyers to counsel positions.  The new partners,
local partners and counsel are located in the firm's New York,
Washington, D.C., Los Angeles, Austin, London, Warsaw and
Frankfurt offices.

"This exceptional group of attorneys is truly representative of
the firm's major practice areas," said Sanford W. Morhouse and
Morton A. Pierce, co- chairs of the Management Committee at Dewey
Ballantine.  "They embody the firm's commitment to excellent legal
representation and client service."

Elected as members of the firm:

Darryl J. Adams practices in the firm's Intellectual Property
Litigation Group in Austin.  He is a 1996 graduate of George
Washington University Law School.  Mr. Adams joined Dewey
Ballantine in 2002.

Michael S. du Quesnay practices in the Structured Finance Group in
Los Angeles.  A 1995 Tulane Law School graduate, he joined the
firm in 1995.

Jonathan J. Kelly is an attorney in the firm's Insurance Group in
New York.  He graduated magna cum laude from the State University
of New York School of Law at Buffalo in 1996.  Mr. Kelly joined
the firm in 1996.

Cecil E. Key practices in the Intellectual Property Litigation
Group in Washington, D.C.  He earned his J.D., cum laude, from
Georgetown University Law Center in 1996. Mr. Key joined the firm
in 2002.

John M. Olivieri is part of the Private Clients Group in New York.
He graduated from Columbia Law School in 1994 and joined Dewey
Ballantine in 1996.

Andrei Yakovlev practices in the Project Finance Group in London.
He earned LL.M. degrees from the University of London in 1994 and
from Northwestern University School of Law in 1995 and his S.J.D
from Northwestern University School of Law in 2002.  Mr. Yakovlev
joined the firm in 1995.

Appointed as counsel:

Andrea S. Miano is part of the Corporate Finance Group in
Washington, D.C.  She graduated from Georgetown University Law
Center in 1990 and joined Dewey Ballantine in 1997.

Brian L. Taylor practices in the Real Estate Group in New York.
He graduated from Boston College Law School in 1981 and joined the
firm in 1995.

Andrew B. Young practices in the Energy Group in Washington, D.C.
He graduated from Harvard Law School and joined the firm in 1996.

Appointed as local partners:

Pawel Bajno practices in the Corporate Finance Group in Warsaw. He
graduated from Warsaw University Faculty of Law and Administration
in 1995.  Mr. Bajno joined Dewey Ballantine in 1995.

Ireneusz Matusielanski is part of the Corporate Finance Group in
Warsaw.  He graduated from Warsaw University Faculty of Law and
Administration in 1998 and joined Dewey Ballantine in 2002.

Piotr Szelenbaum practices in the Corporate Finance Group in
Warsaw.  He graduated from Warsaw University Faculty of Law and
Administration in 1995 and joined Dewey Ballantine in 2002.

Andrzej Wysokinski practices in the Structured Finance Group in
Warsaw.  He is a 1996 graduate of Warsaw University Faculty of Law
and Administration.  Mr. Wysokinski joined the firm in 1996.

Bernulph von Crailsheim practices in the Tax Group in Frankfurt.
He earned his J.D. from the University of Munich in 1993 and his
Ph.D. from the University of Augsburg in 1997.  Dr. von Crailsheim
joined Dewey Ballantine in 2004.

                     About Dewey Ballantine

Dewey Ballantine LLP, founded in 1909, is an international law
firm with more than 550 attorneys and locations in New York,
Washington, D.C., Los Angeles, East Palo Alto, Houston, Austin
London, Warsaw, Frankfurt, Milan, Rome and an associated office in
Prague.  Through its network of offices, the firm handles some of
the largest, most complex corporate transactions, litigation and
tax matters in areas such as M&A, private equity, project finance,
corporate finance, corporate reorganization and bankruptcy,
antitrust, intellectual property, sports law, structured finance
and international trade.  Industry specializations include energy
and utilities, healthcare, insurance, financial services, media,
consumer and industrial goods, consumer electronics, technology,
telecommunications and transportation.


* Ropes & Gray Completes Merger to Create Largest IP Group
----------------------------------------------------------
The merger of Ropes & Gray and Fish & Neave became effective on
Jan. 1, 2005, creating one of the largest intellectual property
(IP) groups at any leading national law firm.

The firm retains the name Ropes & Gray LLP, and the intellectual
property lawyers from the combined firm will be known as the Fish
& Neave IP Group of Ropes & Gray.  The merger will enable the
combined firm to significantly expand the range of intellectual
property litigation, rights management, and licensing services
that it can provide to clients.  For more information, visit
http://www.ropesgray.com/

Ropes & Gray, long known for its strength in general
corporate/transactional work, litigation, investment management,
IP, health care and several industry specialties, becomes a firm
of more than 750 lawyers and professionals.  The resulting Fish &
Neave IP Group of Ropes & Gray is composed of 200 lawyers, 43
patent agents and technical specialists, and 34 paralegals.  In
addition to increasing the size of the New York and Washington
offices, the firm also gains an office in Palo Alto.  The
combination triples the size of Ropes & Gray's New York office,
and doubles the size of the Litigation Department overall.

Said firm Chairman, R. Bradford Malt, "We couldn't be more pleased
with the resulting group and the preeminent intellectual property
resource it offers our clients.  The combination enables us to
serve clients of both firms with broader and deeper capabilities."
Added Mr. Malt: "Each year since 2002 we've added to our firm in
important ways that support our goal of being a leading national
law firm providing cutting-edge legal solutions to clients."

The Fish & Neave IP Group of Ropes & Gray brings a powerful
combination of legal skills and technical expertise to its work.
In addition to IP expertise, professionals possess more than 140
advanced degrees, 60 of which are at the doctorate level in
various scientific disciplines.  In addition, their highly-
regarded in-house graphics team works closely with litigators to
enhance testimony through sophisticated computer, graphics, and
animated tools.  The group has been supporting litigation teams in
communicating with judges and juries for more than ten years.

"It's not often that two similarly storied firms have the ability
to combine in this way.  In our situation, the whole really is
greater than the sum of its parts," said Jesse J. Jenner, former
Chairman of Fish & Neave who now holds a position on Ropes &
Gray's management committee.  "As Fish & Neave grew, we shaped the
IP industry, representing pioneering inventors such as Thomas
Edison, Alexander Graham Bell, and the Wright Brothers.  We
continue this legacy today, working with clients at the forefront
of innovation across nearly every technological field of modern
life.  Now we look forward to being part of a leading national law
firm offering full-service general practice capabilities, that has
successfully positioned itself to succeed well into the 21st
century."

Lawyers in New York remain in their present locations.  Fish &
Neave lawyers in Washington, D.C. joining Ropes & Gray will move
to the firm's office at One Metro Center.  The Boston, San
Francisco, and Palo Alto contact information remains the same.

Ropes & Gray LLP provides comprehensive legal services to leading
businesses and individuals around the world.  Clients benefit from
expertise combined with unwavering standards for integrity,
service, and responsiveness.  With offices in preeminent centers
of finance, technology and government, Ropes & Gray is ideally
positioned to address today's most pressing legal and business
issues.  Capabilities include antitrust, bankruptcy and business
restructuring, corporate mergers and acquisitions, employee
benefits, environmental, health care, intellectual property and
technology, international, investment management, labor and
employment, life sciences, litigation, private equity and venture
capital, private client services, real estate and tax.  The firm
has offices in Boston, New York, Palo Alto, San Francisco, and
Washington, D.C.

                          *********

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, Dylan
Carlo Gallegos, Jazel P. Laureno, Cherry Soriano-Baaclo, Marjorie
Sabijon, Terence Patrick F. Casquejo and Peter A. Chapman,
Editors.

Copyright 2005.  All rights reserved.  ISSN: 1520-9474.

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

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

                *** End of Transmission ***