TCR_Public/050513.mbx       T R O U B L E D   C O M P A N Y   R E P O R T E R

            Friday, May 13, 2005, Vol. 9, No. 112

                          Headlines

ABRAXAS PETROLEUM: March 31 Balance Sheet Upside-Down by $43 Mil.
ADB SYSTEMS: Incurs CDN$736,000 Net Loss in First Quarter
ALLIANCE ONE: S&P Rates 12-3/4% Senior Subordinated Notes at B
ALLIED HOLDINGS: Poor Performance Prompts S&P to Junk Ratings
ANTHRACITE CDO: Fitch Holds BB Rating on $13 Mil. Class H Notes

APOLLO GOLD: Incurs $3.7 Million Net Loss in First Quarter
ATA AIRLINES: Goodrich's Motion to Allow $2.2MM Claim Draws Fire
BREED TECHNOLOGIES: Modest Distribution Coming from Creditor Trust
BUFFETS HOLDINGS: Moody's Revises Rating Outlook to Negative
CALL-NET: Rogers Communications Acquiring Company for $330 Million

CALL-NET: Deal with Rogers Prompts 's Positive CreditWatch
CARDIMA INC: Posts $2 Million Net Loss in First Quarter 2005
CARROLS CORP: Form 10-K Filing Delay Prompts S&P to Junk Ratings
CATHOLIC CHURCH: Portland Wants Exclusive Periods Extended
CELLSTAR CORP.: Warns of Default Under Wells Fargo Loan Agreement

CHASE COMMERCIAL: Moody's Puts Low-B Ratings on Six Cert. Classes
CHYRON CORP: March 31 Balance Sheet Upside-Down by $1.6 Million
CMACAO: Case Summary & 20 Largest Unsecured Creditors
CONGOLEUM CORP: AIG Companies Settle Asbestos Claims for $103 Mil.
CNET NETWORKS: Good Performance Prompts S&P's Positive Outlook

COGENTRIX ENERGY: Moody's Assigns Ba2 Senior Implied Rating
COLETO CREEK: Moody's May Pare Ratings Due to Slow Debt Reduction
COMPRESSION POLYMERS: Moody's Rates $215M Sr. Unsec. Notes at B2
CONXUS COMMUNICATIONS: Chapter 7 Case is Coming to an End
CORNING INC.: S&P Lifts Ratings on Three Transactions to BBB-

CREDIT SUISSE: S&P Puts Low-B Ratings on $38 Million Class Certs.
DELPHI CORP.: Hires Rothschild as Financial Advisor
DESA HOLDINGS: Has Until May 23 to Remove State Court Actions
DJT LLC: Involuntary Chapter 11 Case Summary
DMX MUSIC: Wants to Hire Downer & Company as Investment Bankers

DMX MUSIC: Has Until June 14 to Make Lease-Related Decisions
DOANE PET: Earns $7.2 Million of Net Income for First Quarter
DOMTAR INC: Weak Cash Flow Prompts S&P to Cut Ratings to BB+
DONNKENNY INC: Court Okays Rejection of 19 Contracts & Leases
EL PASO: Earns $106 Million of Net Income in First Quarter 2005

EMMIS COMMS: Stock Repurchase Plan Cues Moody's to Review Ratings
EMMIS COMMS: $400 Million Share Buyback Cues S&P to Watch Ratings
EPOCH INVESTMENTS: Involuntary Chapter 11 Case Summary
EQUITY INNS: Moody's Assigns Ba3 Issuer Rating on Partnership
FALCON PRODUCTS: Committee Taps XRoads Solutions as Fin'l Advisors

FALCON PRODUCTS: Wants Exclusive Periods Extended Until Aug. 1
FEDDERS CORP: Delays Filing of Annual & Quarterly Reports
FORD CREDIT: Fitch Lifts Ratings on Series 2002-C Class D Certs.
FOOTSTAR INC.: Kmart Wants Footstar to Vacate 13 More Stores
FRIEDMAN'S INC: Creditors Must File Proofs of Claim by June 30

GENERAL MARITIME: New Dividend Policy Prompts S&P to Hold Ratings
GENTEK INC: Posts $1 Million Net Loss in First Quarter 2005
GLOBAL TEL*LINK: Moody's Rates $22.5M 2nd Priority Loan at B3
GOODYEAR TIRE: Names Joseph Copeland CEO of Australian Venture
GREAT ATLANTIC: Restructuring Prompts S&P's Developing Outlook

HAYES LEMMERZ: Apollo Demands Registration of Equity Stake
INDEPENDENCE III: Moody's Junks $22 Mil. Classes C-1 & C-2 Notes
INTEGRATED BUSINESS: March 31 Balance Sheet Upside-Down by $5 Mil.
IPIX CORP: Reports Financial Results for First Quarter 2005
ISTAR ASSET: Fitch Lifts Ratings on 7 Class Certificates

LEAP WIRELESS: Posts $6.6 Million Net Loss in Fourth Quarter
LORAL SPACE: March 31 Balance Sheet Upside-Down by $1.07 Billion
MAXXAM INC: Lumber Units' Bankruptcy Imminent as Losses Continue
MEDCOMSOFT INC: $6 Mil. Equity Infusion Turnarounds Balance Sheet
MERIDIAN AUTOMOTIVE: U.S. Trustee Appoints 7-Member Committee

MERIDIAN AUTOMOTIVE: Freightliner Argues Tooling Can't be Pledged
MICROTEC ENTERPRISES: Quebec Superior Court Sanctions CCAA Plan
MIRANT CORP: Earns $11 Million of Net Income in First Quarter
MIRANT: Shareholders Want to Call Witnesses in Valuation Hearing
MIRANT CORP: Deutsche Bank Says Disclosure Statement Lacks Info

MIRANT CORP: Hires Mayer Brown to Handle Predator Development Suit
MOONEY AEROSPACE: 2004 Year-End Revenues Up 16% to $19.3 Million
NATIONAL BENEVOLENT: Moody's Withdraws Ca Rating After Repayment
NATIONAL CENTURY: Court Orders DFS & DynaCorp to Return $2.1 Mil.
NAUTICAL DATA: Canadian Hydrographic Can't Terminate Contract

NEENAH PAPER: Earns $2.7 Million of Net Income in First Quarter
NEORX CORP: 40% Lay-Off Doesn't Trigger Bank Loan Default
NEW WORLD RESTAURANT: March 29 Balance Sheet Upside-Down by $117MM
NEXTEL PARTNERS: Strong Performance Prompts Moody's to Up Ratings
O'SULLIVAN IND: March 31 Balance Sheet Upside-Down by $197.5 Mil.

OCEAN CREST: Case Summary & 15 Largest Unsecured Creditors
OCEANVIEW CBO: Fitch Places $18 Million Notes on Watch Negative
OMNI ENERGY: Auditors Express Going Concern Doubt
OMNI ENERGY: Extends Bridge Loan Maturity with Beal Bank to May 31
OREGON STEEL: Good Performance Prompts S&P to Lift Ratings

OWENS CORNING: Battle Brews Over Three Property Damage Claims
PACIFIC MAGTRON: Case Summary & 55 Largest Unsecured Creditors
PEGASUS SATELLITE: Gets Court Nod to Dispose De Minimis Assets
PRIMEDIA INC: Earns $365.5 Million of Net Income in First Quarter
PRIMUS TELECOM: Faltering Performance Cues Moody's to Junk Ratings

PROXIM CORP: Needs to Secure Financing to Avert Bankruptcy Filing
QUALITY DISTRIBUTION: March 31 Balance Sheet Upside-Down by $31MM
QWEST COMMUNICATIONS: Exchanging Private Debt with New Notes
QWEST COMMS: S&P Holds Low-B Ratings on Three Class Certificates
R.J. REYNOLDS: Moody's Sees Adequate Liquidity for Next 12 Months

ROCK-TENN CO: Moody's Rates $700M Senior Unsec. Facilities at Ba2
ROGERS COMMS: Plans to Acquire Call-Net for $330 Million in Stock
SALEM COMMS: Names Carl Miller National Program Placement Director
SEARS ROEBUCK: Finance Unit Delisting Shares & Buying Back Notes
SCHUFF INTERNATIONAL: Improved Liquidity Cues S&P to Lift Ratings

SINO-FOREST CORP: Closes $195M Financing on Mandra Transactions
SITHE/INDEPENDENCE: Moody's Holds Ratings Despite Dynegy Review
SPANISH BROADCASTING: S&P Junks Proposed $100MM Second-Lien Loan
STELCO INC: Earns $49 Million of Net Income in First Quarter
TECO ENERGY: Moody's Assigns Ba1 Senior Implied Rating

TIMOTHY C. WHEELER: Case Summary & 20 Largest Unsecured Creditors
TRANSCOM ENHANCED: Bankruptcy Court Rules Against AT&T and SBC
TRICOM SA: Losses, Defaults & Going Concern Doubts Continue
UAL CORP: Posts $1.1 Billion Net Loss in First Quarter 2005
UAL CORPORATION: Flight Attendants Want Management Replaced

UAL CORP: Pension Plan Termination May Reduce PBGC Deficit
US AIRWAYS: Asks Court to Allow Sabre's $7,131,989 Admin. Claim
USG CORP: Gets Court Nod to Amend $100M LaSalle L/C Facility
USG CORP: Has Until Sept. 1 to Make Lease-Related Decisions
VECTOR GROUP: March 31 Balance Sheet Upside-Down by $19.1 Million

VISTEON CORP: Accounting Irregularities & Cash Flow Warning
VISTEON CORP: Form 10-Q Filing Delay Cues Moody's to Pare Ratings
VISTEON CORP.: Form 10-Q Filing Delay Cues S&P to Lower Ratings
VIVENTIA BIOTECH: Equity Deficit Widens to C$26.54M as of Mar. 31
W.R. GRACE: Saving Millions as Court Approves IRS Settlement

WESTERN OIL: Gets Shareholders' Nod on 3 for 1 Share Split
WESTERN OIL: Names David Boone & Jim Houck to Board of Directors
WESTPOINT STEVENS: Wants to Sell Rosemary Property to Spealman
WINFRED CHRISTIAN: Case Summary & 20 Largest Unsecured Creditors
YUKOS OIL: Yugansk Lawsuits Against Yukos Set for Hearing in May

* Moody's Places Stable Credit Outlook For U.S. REITs
* AlixPartners Names Emanuele Pedrotti as Director

* BOOK REVIEW: Getting It to the Bottom Line

                          *********

ABRAXAS PETROLEUM: March 31 Balance Sheet Upside-Down by $43 Mil.
-----------------------------------------------------------------
Abraxas Petroleum Corporation (AMEX:ABP) reported financial and
operating results for the quarter ended March 31, 2005.  As a
result of the Grey Wolf Exploration Inc. initial public offering
that closed on February 28, 2005, this information represents
financial and operating results from operations in the U.S. only
as all of Grey Wolf's historical performance and results from the
sale of Grey Wolf shares owned by Abraxas, are treated as
discontinued operations.

Production of 1.3 Bcfe for the quarter generated revenues of
$7.8 million and a net loss of $1.5 million from continuing
operations. This compares to a net loss from continuing operations
of $5.8 million for the same quarter of 2004.  Net income of
$9.2 million (including a discontinued operations impact of
$10.7 million) for the first quarter of 2005 included a
$19.6 million gain on the sale of the Grey Wolf shares in the IPO,
a $6.1 million non-cash income tax expense related to the sale of
the Grey Wolf shares that Abraxas owned which offset a similar tax
benefit booked in the fourth quarter of 2004, and a $2.8 million
loss from operations, predominantly for debt retirement costs of
loans that were repaid with the proceeds from the Grey Wolf IPO.

As a result of the elimination of our capital expenditure
limitations, the most significant item related to the first
quarter of 2005 results included capital expenditures of $8.7
million compared to $2.2 million in the first quarter of 2004.

"The 1st quarter of 2005 was a busy time at Abraxas -- we
completed the Grey Wolf IPO thus, significantly reducing the
leverage on our balance sheet and returning our focus to U.S.
development as we kicked off our capital development program with
7 wells in South and West Texas.  We are currently drilling 1
horizontal well in West Texas and completing and/or testing 1
vertical well in West Texas and 3 horizontal wells in South Texas.
The horizontal wells have been encouraging as we look forward to
definitive results upon completion and testing of the wells
despite delays in contracting equipment," commented Bob Watson,
Abraxas' President and CEO.

                        About the Company

Abraxas Petroleum Corporation is a San Antonio based crude oil and
natural gas exploitation and production company with operations in
Texas and Wyoming.

At Mar. 31, 2005, Abraxas Petroleum Corporation's balance sheet
showed a $43,389,000 stockholders' deficit, compared to a
$53,464,000 deficit at Dec. 31, 2004.


ADB SYSTEMS: Incurs CDN$736,000 Net Loss in First Quarter
---------------------------------------------------------
ADB Systems International Ltd. (TSX: ADY; OTCBB: ADBYF)disclosed
its interim financial results for the first quarter ended
March 31, 2005.

ADB reported revenues of CDN$1.54 million for the quarter, an
increase of more than 30 percent when compared to the
$1.18 million generated in the first quarter of 2004.  In
the fourth quarter of 2004, ADB generated revenues of
CDN$1.53 million.  Revenues were comprised of software license
sales, service fees for software development and implementation,
application hosting, maintenance, support and training.

"Our first quarter was among the most active ever for ADB," said
Jeff Lymburner, CEO of ADB Systems.  "We added to our roster of
customers, entered into a financing arrangement, expanded our
relationships with a number of key customers, expanded our GE
joint venture sales pipeline, and increased our revenues year-
over-year by 30 percent."

ADB recorded a net loss for the period of CDN$736,000 or $0.01 per
basic share.  This compares to a net loss of $1.39 million or
$0.02 per basic share in Q1 of 2004, an improvement of 46 percent,
and a net loss of $773,000 or $0.01 per basic share in Q4 of 2004.

Consistent with its previous guidance of April 13, 2005, the
Company announced that it generated $415,000 of positive cash flow
from operations in the first quarter based on customer activities,
cost-containment measures and the seasonal influx of customer
support fees.

As at March 31, 2005, ADB held cash and marketable securities of
CDN$1.42 million.

                       Operating highlights

In addition to its financial performance, the Company achieved a
number of operating achievements in the quarter:

    --  ADB entered into a customer agreement with Mesta AS,
        Norway's road construction company, providing a
        comprehensive electronic procurement solution that
        integrates capabilities for purchasing, supplier
        collaboration, and project management activities.

    --  The Company expanded its relationship with the Healthcare
        Purchasing Consortium of the U.K., enabling the National
        Health Service to accelerate the deployment of an
        electronic procurement initiative.

    --  ADB entered into a strategic financing arrangement with
        Pinetree Capital, generating net proceeds of $570,000,
        after $5,000 of financing-related costs. Under the terms
        of the private placement, ADB issued Pinetree 2.5 million
        units, each priced at $0.23.  Each unit consists of one
        common share and one-half of one common share purchase
        warrant.  Each full warrant entitles Pinetree to purchase
        one common share in the company at the exercise price of
        $0.40 each.  Warrants are exercisable for a period of up
        to four years.

    --  The Company expanded its business relationship with
        Fabricom AS, a Norwegian provider of construction,
        installation and maintenance services to the oil and gas
        industry.  Fabricom integrated a number of ADB's web-based
        applications that are streamlining procurement and
        supplier collaboration activities.

                        Outlook and guidance

"Building on our recent momentum, we anticipate that our revenues
in Q2 will grow by at least 10 percent over Q1 results,
representing a year-over-year growth of approximately 30 percent
when compared to Q2 of 2004," said Mr. Lymburner.  "We believe
this growth will be possible based on a number of factors,
including an increasing demand for our suite of technology
offerings, ongoing customization of our software solutions within
key customer environments, and new sales opportunities identified
through our joint venture with GE and our key channel partners."

                  Annual general meeting scheduled

ADB will hold its annual general meeting of shareholders on May
18, at 3:00 p.m. at the Holiday Inn on King, located at
370 King Street West, Toronto.  The meeting will be open to
registered shareholders, accredited media and financial analysts.
Copies of ADB's 2004 Annual Report, Notice, Information Circular
and voting information have been distributed to shareholders, and
are also be available electronically through SEDAR.  Interested
individuals unable to attend the meeting will be able to listen to
a live web-cast on the Company's website, http://www.adbsys.com/

ADB Systems International delivers asset lifecycle management
solutions that help organizations source, manage and sell assets
for maximum value.  ADB works with a growing number of customers
and partners in a variety of sectors including oil and gas,
government, healthcare, manufacturing and financial services.
Current customers include BP, GE Commercial Equipment Financing,
Halliburton Energy Resources, the National Health Service,
permanent TSB, Talisman Energy, and Vesta Insurance.

Through its wholly owned subsidiary, ADB Systems USA, Inc., ADB
owns a 50 percent interest in GE Asset Manager, a joint business
venture with GE.  ADB has offices in Toronto (Canada), Stavanger
(Norway), Tampa (U.S.), Dublin (Ireland), and London (U.K.). The
company's shares trade on both the Toronto Stock Exchange (TSX:
ADY) and the OTC Bulletin Board (OTCBB: ADBYF).

As of December 31, 2004, ADB Systems International posted a
CDN$1,009,000 equity deficit compared to a $1,026,000 positive
equity at December 31, 2003.


ALLIANCE ONE: S&P Rates 12-3/4% Senior Subordinated Notes at B
--------------------------------------------------------------
Standard & Poor's Ratings Services assigned its 'B' rating to
Alliance One International Inc.'s 12.75% senior subordinated notes
due November 2012.  At the same time, Standard & Poor's affirmed
its 'BB-' corporate credit and bank loan ratings on Alliance One
and Intabex Netherlands B.V.

In addition, Standard & Poor's affirmed its 'B' rating on Alliance
One's $315 million 11% senior notes due May 2012.  The senior note
transaction was downsized to $315 million from the originally
proposed $450 million that was rated on May 3, 2005.  Also, the
maturity date was shortened by one year.  The senior note issue is
two notches below the corporate credit rating because of the
amount of priority obligations and secured debt ahead of the
senior unsecured debt issue.  Furthermore, Alliance One is both a
holding company and directly owns certain U.S. operating assets of
the merged companies.

The outlook is negative.  Pro forma for the refinancing, total
rated debt on Danville, Virginia-based Alliance One is about $1.1
billion.

Alliance One results from the planned merger of the number-two and
number-three independent leaf tobacco dealers, DIMON Inc. and
Standard Commercial Corp., respectively.  At closing, Standard
Commercial will merge into DIMON, and then DIMON will change its
name to Alliance One.

The ratings on DIMON and Standard Commercial and related entities
will remain on CreditWatch until the closing of the Alliance One
transactions and will then be removed from CreditWatch where they
were placed on May 25, 2004 and Nov. 9, 2004, respectively, and
withdrawn.


ALLIED HOLDINGS: Poor Performance Prompts S&P to Junk Ratings
-------------------------------------------------------------
Standard & Poor's Ratings Services lowered its corporate credit
rating on Allied Holdings Inc. to 'CCC+' from 'B' and senior
unsecured rating to 'CCC-' from 'CCC+'.  The ratings are from
removed from CreditWatch, where they were placed with negative
implications on April 20, 2005.  The outlook is negative.

"The downgrade is based on concerns regarding the company's
ability to preserve liquidity, maintain covenant compliance, and
control costs, given the challenging industry conditions
associated with the trucking and North American automotive
sectors," said Standard & Poor's credit analyst Kenneth L. Farer.
This rating action is not directly related to the downgrade of
General Motors Corp. and Ford Motor Co. on May 5, 2005 (which
accounted for 35% and 24%, respectively, of Allied's 2004
revenues).  However, competitive and financial pressures on the
auto manufacturers could affect Allied in the future.  The
Decatur, Georgia-based automotive transportation company had about
$280 million of lease-adjusted debt at year-end 2004.

Ratings on Allied Holdings reflect its:

    (1) weak financial flexibility,

    (2) aggressively leveraged capital structure,

    (3) concentrated end-customer base, and

    (4) participation in the capital-intensive trucking industry.

Although Allied's specialized fleet delivers approximately 60% of
new vehicles in North America and the company has negotiated
favorable contract terms with a number of key customers, it faces
competition from other specialty carriers for short-distance trips
and major railroads for long-distance trips.  Despite some recent
price increases, the car hauling industry faces pricing pressure
from the large auto manufacturers, which represent a majority of
the company's revenues, and increasing labor costs.

Generally, revenues for the industry trend closely with North
American vehicle production figures, which are forecast to
continue at weak level compared to the last few years.  New
entrants are not expected due to the substantial capital required
for trucks, car-hauling trailers, and terminals.

Management is taking steps to:

    (1) improve the productivity of the company's terminal
        network;

    (2) negotiating contracts at higher rates; and

    (3) reducing its cost structure.

Failure to show a reversal in the credit measure deterioration
over the near- to intermediate-term could lead to a review for
another downgrade.

In addition, ratings could be lowered if:

    (1) covenants are breached,

    (2) additional financial statements are delayed, or

    (3) revenue pressures increase from the automobile
        manufacturers.

An outlook revision to stable is not anticipated in the near term,
given the company's weak financial profile and the challenging
automotive sector.


ANTHRACITE CDO: Fitch Holds BB Rating on $13 Mil. Class H Notes
---------------------------------------------------------------
Fitch Ratings affirms all of the rated notes issued by Anthracite
CDO III Ltd. and Anthracite CDO III Corp.  The affirmations of
these notes are the result of Fitch's annual rating review process
and are effective immediately.

    -- $208,933,393 class A floating-rate senior notes at 'AAA';

    -- $14,384,000 class B-FX fixed-rate subordinate notes at
       'AA';

    -- $27,000,000 class B-FL floating-rate subordinate notes at
       'AA';

    -- $2,500,000 class C-FX fixed-rate subordinate notes at 'A+';

    -- $24,727,000 class C-FL floating-rate subordinate notes at
       'A+';

    -- $10,000,000 class D-FX fixed-rate subordinate notes at
       'A-';

    -- $13,959,000 class D-FL floating-rate subordinate notes at
       'A-';

    -- $26,427,000 class E-FX fixed-rate subordinate notes at
       'BBB';

    -- $10,600,000 class E-FL floating-rate subordinate notes at
       'BBB';

    -- $22,871,000 class F fixed-rate subordinate notes at 'BBB';

    -- $7,623,000 class G floating-rate subordinated notes at
       'BBB-';

    -- $13,069,000 class H fixed-rate junior notes at 'BB'.

Anthracite III is a collateralized debt obligation managed by
BlackRock Financial Management, Inc. which closed March 30, 2004.
Anthracite III is composed of a static pool of 83.4% commercial
mortgage-backed securities, 12.02% real estate investment trusts,
one credit tenant lease (3.7%), and one CDO (.9%).  Included in
this review, Fitch discussed the current state of the portfolio
with the asset manager and their portfolio management strategy
going forward.

As stated in the April 21, 2005 trustee report, Anthracite III has
$431 million in collateral debt securities with a stable weighted
average rating of 'BB+/BB'.  Each of the overcollateralization
(OC) and interest coverage (IC) tests are currently in compliance
with their respective performance test measures due to the steady
performance of the portfolio.

As a result of this analysis, Fitch has determined that the
current ratings assigned to the class A, B, C, D, E, F, G, and H
notes still reflect the current risk to noteholders.  Fitch will
continue to monitor and review this transaction for future rating
adjustments.

The ratings on the class A, B-FX, B-FL, C-FX and C-FL notes,
address the likelihood that investors will receive timely payment
of interest and ultimate payment of principal by the stated
maturity date.  The ratings on the class D-FX, D-FL, E-FX, E-FL,
F, G and H notes address the ultimate payment of interest and
ultimate repayment of principal.


APOLLO GOLD: Incurs $3.7 Million Net Loss in First Quarter
----------------------------------------------------------
Apollo Gold Corporation (AMEX:AGT) (TSX:APG) reported a net loss
of $3.7 million or $0.04 per basic share for the first quarter
2005 compared to a net loss of $1.6 million or $0.02 per basic
share for the first quarter 2004.

                  First Quarter 2005 Highlights

   -- Production and sales of 22,491 ounces of gold at a cash
      operating cost of $415 per ounce and a total cash cost of
      $438 per ounce.  Development gold ounces from the Standard
      Mine added 3,603 ounces for a total of 26,094 ounces for the
      quarter.

   -- At the Standard Mine loading of ore onto the heap leach pad
      continued throughout the quarter and the area under leach
      was expanded.  It was determined that the mine was not in
      commercial production in the first quarter even though it
      did produce 3,603 ounces of gold.

   -- Florida Canyon produced 9,846 ounces of gold with cash
      operating costs of $384 per ounce and total cash costs of
      $394 per ounce.

   -- Montana Tunnels produced 12,645 ounces of gold at a cash
      operating cost of $440 per ounce and total cash costs of
      $472 per ounce.

   -- Drilling at the Black Fox project continued throughout the
      quarter with 107 core holes (22,744 meters) being completed,
      bringing the total to date to 715 core holes (189,708
      meters).   Assay highlights in the quarter include hole
      number 235-234 with a true width of 6.5 ft of 5.33 oz gold
      per ton and hole number 05BF - 417 with a true width of 5.2
      ft of 2.62 oz gold per ton.  Many other assays were multiple
      feet intercepts with multiple gold ounce assays.

   -- Ore reserves were updated and as of December 31, 2004, the
      Company had a total of 1,806,900 ounces of proven and
      probable gold reserves.

   -- The gold put/call straddle position was reduced to 4,000
      ounces as of March 31, 2005. The position was closed out in
      April 2005.

R. David Russell, President and CEO of the Company, said: "Our
cash costs were higher than the Company or the market would like
them to be and we are focused on bringing these costs down in the
second quarter 2005.  However, we can take comfort in some
positive developments from this first quarter 2005.

"Montana Tunnels has completed its waste stripping program and we
saw stripping ratios come down from 3.6:1 to 1.6:1 during the
quarter with lower strip ratios expected to continue throughout
the year.  Total cash costs were high for the quarter at $472 per
ounce but again there was an improving trend throughout the
quarter, which is expected to continue into the second quarter as
grades improve.

"At the beginning of March 2005 we made the decision to
temporarily suspend mining activity at the Florida Canyon;
however, we continue to leach gold from the heap leach pad.  The
change in mine planning was made so as to concentrate efforts on
the new Standard Mine operations and the associated development of
the new heap leach pad construction and loading.  The leach pad at
Florida Canyon contained an estimated 55,000 ounces of gold at the
beginning of 2005.  The total cash cost at Florida Canyon for the
quarter appear high at $394 per ounce but this number does include
a charge from inventory equivalent to $167 per ounce for the
drawdown of gold inventory ounces from the pad.

"The Company's new Standard Mine continued ramping up leach pad
loading with initial development ounces poured throughout the
quarter for a total of 3,600 ounces poured and sold.  It was
determined that for the first quarter the mine was not in
commercial production and all costs of operation and revenue were
capitalized.  We now fully expect to see this mine enter into
commercial production during the second quarter 2005.

"As a result of our put/call gold contracts we received an average
sales price for our gold of $384 per ounce in the first quarter
2005 compared to the market average of $427 per ounce.  With the
completion of the contracts in April 2005 we will in future be
able to sell our production at prevailing prices.

"At Black Fox we continued with our drilling program and made
positive progress on permitting and the feasibility study.  The
drilling results published during the first quarter continue to
indicate continuity of the ore body and consistent economic gold
grades.  The ore zones are open along strike and to depth.  In
addition to the gold zones we expanded upon the base metal-gold
zone that was discovered in 2004.  The base metal-gold zone
appears to be independent of the original gold zone described.  We
plan to continue to develop the base metal-gold zone as a second
priority to the primary gold zone.  I still remain excited by the
new base metal ore zone as we continue to have successful results
from this drilling campaign.

"I look forward to the second quarter 2005 and beyond, with the
continued positive trend results as I am confident they will show
that Apollo will continue with its improvements and exploration
successes."

                        Summary of Results

The result is that Apollo incurred a loss of $3.7 million or $0.04
per share for the three months ended March 31, 2005, as compared
to a loss of $1.6 million or $0.02 per share for the three months
ended March 31, 2004.  Operating expenses totaled approximately
$20.6 million for the three months ended March 2005, as compared
to approximately $20.9 million for the same period in 2004.

               Liquidity and Financial Resources

To date, Apollo has funded its operations primarily through
issuances of debt and equity securities.  At March 31, 2005, cash
and cash equivalents was $2.5 million, compared to cash and cash
equivalents of $6.9 million at December 31, 2004.  The decrease
in cash from December 31, 2004, was primarily the result of
operating cash outflows of $2.4 million, investment activities
of $3.9 million, plus a reduction of capital lease debt of
$0.7 million and debenture interest paid of $0.3 million.

Investing activities used $3.9 million of cash during the three
months ended March 31, 2005, compared to $8.7 million in the same
period 2004.  Capital expenditures in the first quarter were
$3.6 million of which $1.0 million were expended at Standard mine,
$2.0 million for the further development of the Black Fox project
and $0.5 million in respect of the finalization of the Montana
Tunnels waste strip program.  In addition to these capital
expenditures, $0.4 million was invested in the restricted cash
account as part of the Montana Tunnels reclamation liability.

During the quarter the Company's put/call gold straddle position
was reduced from 16,000 ounces of gold down to 4,000 ounces as of
March 31, 2005.  The final 4,000 ounces was delivered into the
contract on April 25, 2005.

Apollo intends to raise additional funds from the sale of spare
mining equipment and may raise additional financing from the sale
of debt or equity securities, which may include Canadian flow-
through financing to fund a portion of its Canadian exploration.
We expect that these funds, together with internally generated
funds, will be sufficient to fund the remainder of the 2005
corporate overheads of approximately $5.0 million, lease payments
of $1.8 million and debenture interest of $0.8 million.

                      Financing Activities

Financing activities for the three months ending on
March 31, 2005, included completing the second tranche of a
private placement of 4,199,998 units with an issue price of $0.75
for proceeds of $2.8 million, net of expenses of $0.3 million and
fair value of broker's compensation warrants of $0.2 million.

Apollo Gold is a gold mining company with operating mines in
Nevada and Montana and an advanced stage development project,
Black Fox, along the productive Destor-Porcupine Fault east of the
Timmins Gold Camp in Ontario, Canada. Apollo has also recently
started the Huizopa exploration project in the Sierra Madre
Mountains of Mexico.

                         *     *     *

                      Going Concern Doubt

The company's auditor, Deloitte & Touche LLP, expressed
substantial doubt on the Company's ability to continue as a going
concern on the Company's annual report dated, March 15, 2005.


ATA AIRLINES: Goodrich's Motion to Allow $2.2MM Claim Draws Fire
----------------------------------------------------------------
Goodrich Corporation and ATA Airlines, Inc., are parties to a
Wheel and Brake Service and Purchase Agreement, dated as of
June 23, 2000.  Under the Agreement, Goodrich provides:

    -- all of the Debtor's requirements for services and
       equipment related to aircraft wheels and brakes for its
       aircraft fleet; and

    -- certain conditional benefits, in the form of spare
       equipment, discounts and cash payments, in connection with
       the Debtor's addition of certain aircraft to its
       operational fleet of aircraft.

Carren Shulman, Esq., at Heller Ehrman White & McAuliffe LLP, in
New York, relates that Goodrich has performed its postpetition
obligations under the Agreement.  As ATA Airlines has brought new
aircraft into operation, Goodrich provided ATA with spare aircraft
wheels and brakes, including related parts and assemblies, at no
cost to the Debtor.  In addition, Goodrich has provided the Debtor
with certain merchandise credits and cash incentives with respect
to the new aircraft.

ATA Airlines, however, has removed certain aircraft from its
operational fleet, thereby causing the conditions on which the
benefits were provided to the Debtor to fail and triggering
certain reimbursement requirements.

By this motion, Goodrich asks the U.S. Bankruptcy Court for the
Southern District of Indiana to allow it a $2,242,380
administrative expense claim for the value of the spare wheels and
brakes and cash benefits it has provided to ATA Airlines with
respect to aircraft that the Debtor has determined it no longer
requires.

Ms. Shulman tells Judge Lorch that the Claim constitutes "actual,
necessary costs and expenses" pursuant to Sections 503(b)(1)(A)
and 507(a)(1) of the Bankruptcy Code.  The Claim arose after the
Petition Date as a result of ATA Airlines' decision to reduce its
fleet, presumably, in the hope that it will lead to a successful
reorganization and preserve the estate for the benefit of existing
creditors.

Although protected by Section 365, Ms. Shulman contends that ATA
Airlines is entitled to receive no more than the benefit of its
bargain, namely Goodrich's provision of the Debtor's requirements
for the services and equipment.  Ms. Shulman points out that ATA
Airlines obtained added benefits with its retention of the spares
and cash that it no longer requires.

                   Creditors Committee Objects

The Official Committee of Unsecured Creditors asks the Court to
deny Goodrich's request on these grounds:

   (1) Goodrich has failed to meet its burden of proof, under
       applicable law, to demonstrate that it is entitled to an
       award of an administrative expense claim under Sections
       503(b)(1)(A) and 507(a)(1); and

   (2) The request constitutes an improper attempt by Goodrich to
       require the Debtors to assume the Agreement without
       complying the requirements of Section 365(d)(2), which
       governs the shortening of the time for the Debtors to
       assume or reject the Agreement.

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 Nos. 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. 22; Bankruptcy Creditors'
Service, Inc., 215/945-7000)


BREED TECHNOLOGIES: Modest Distribution Coming from Creditor Trust
------------------------------------------------------------------
The U.S. Bankruptcy Court for the District of Delaware directed
BREED Technologies, Inc., to submit a status report.  The
Reorganized Debtor complied on May 9, 2005.

Since the Effective Date, the Debtor has objected to and
reconciled thousands of claims filed in the Bankruptcy Case.  At
present, the only claim objection remaining outstanding relates to
three claims filed by the Internal Revenue Service.  The IRS and
the Debtor are working together in an attempt to resolve the
issues surrounding the Government's Claims and the Debtor's
objection.  The Debtor anticipates that two of the IRS Claims will
he resolved shortly.  The third and final IRS Claim is being
addressed outside the claim objection process through IRS audit
procedures.

The Plan provided for, among other things, New Common Stock in the
Reorganized Debtor to be issued to the Banks and for the formation
of two separate trusts to administer and distribute certain assets
to creditors.

The first trust, the Breed Creditor Trust was to administer all
avoidance actions and distribute proceeds in accordance with the
trust documents.  The trustee of the Breed Creditor Trust
subsequently commenced a number of avoidance actions.  Counsel for
the trustee of the Breed Creditor Trust advises that the only
claim remaining under the avoidance actions is a $475,000 claim in
the bankruptcy proceeding of MCI Worldcom.

The second trust created under the Plan, the AlliedSignal Recovery
Trust, was established for the benefit of certain holders of
allowed claims for the prosecution of claims against AlliedSignal,
Inc. (now known as Honeywell International Inc.).  Prior to
BREED's chapter 11 filing, the company commenced an action against
AlliedSignal for fraud, misrepresentation and fraudulent transfer.

The Debtor sought judgment against AlliedSignal for compensatory
damages in an amount not less than S325 million and, with respect
to the fraudulent transfer claims, avoidance of the fraudulent
transfer and an award not less than $710 million.  Following the
Effective Date of BREED's Third Amended Joint Plan of
Reorganization, the trustee for the AlliedSignal Recovery Trust,
in accordance with the trust documents, has been administering the
AlliedSignal Litigation.  BREED's counsel understands that the
AlliedSignal Litigation is scheduled for trial in late 2005.

To date, the trustee for the Breed Creditor Trust and the
AlliedSignal Recovery Trust has distributed $800,000 to the Banks
and the 9.25% Noteholders.  BREED understands that the Trustee
intends to make a further distribution to general unsecured
creditors pursuant to and under the Breed Creditor Trust later
this year.  The "distributions will be modest, as the amounts
recovered under the avoidance actions were modest," BREED says.
Distributions under the AlliedSignal Recovery Trust cannot be made
unless and until the AlliedSignal Litigation is resolved in the
AlliedSignal Recovery Trust's favor.

BREED, a global producer of automotive safety systems, filed for
chapter 11 protection on Sept. 20, 1999 (Bankr. D. Del. Case No.
99-3399).  The Bankruptcy Court confirmed BREED's Third Amended
Joint Plan of Reorganization on Nov. 22, 2000.  The plan took
effect on Dec. 26, 2000.  The Reorganized Debtor is represented by
Mary F. Caloway, Esq., and Mark R. Owens, Esq., at Klett Rooney
Lieber & Schorling, and Steven J. Kahn, Esq., at Pachulski, Stang,
Ziehl, Young, Jones & Weintraub P.C.


BUFFETS HOLDINGS: Moody's Revises Rating Outlook to Negative
------------------------------------------------------------
Moody's Investor's Service revised the rating outlook of Buffets
Holdings, Inc., to negative from stable and affirmed all ratings.
Moody's concern that average unit volume, store level margin,
lease adjusted leverage, and fixed charge coverage may not
meaningfully improve over the next twelve months prompted the
negative outlook.  In Moody's opinion, the outcome of pending
initiatives designed to improve revenue and debt protection
measures remains uncertain.

These ratings are affirmed:

   * $287 million secured bank loan of Buffets, Inc., at B1,

   * $180 million 11.25% senior subordinated notes (2010) of
     Buffets, Inc., at B3,

   * $132 million 13-7/8% senior discount notes (2010) of Buffets
     Holdings, Inc., at Caa1,

   * Senior implied rating at B2, and the

   * Long-term issuer rating at Caa1.

Operating performance and debt protection measures are weaker than
Moody's expected at this point when ratings were last reviewed in
May 2004.  The ratings are limited by the company's high financial
leverage (especially adjusted for operating lease obligations) and
low fixed charge coverage, the intense competition at the moderate
price point for buffet-style restaurants, and the sensitivity of
customer traffic to changes in disposable income levels.
Challenges in reversing weak customer traffic trends through
upgrading the menu, implementing an effective marketing program,
and rolling out an upgraded store environment, as well as
uncertainties about long-term growth prospects for the mature
buffet/cafeteria segment, also adversely affect Moody's opinion of
the challenges facing the company.

However, the ratings also consider Moody's opinion that the
company:

   (1) can sustain a period of weak operations with available
       liquidity (given our expectation of bank loan covenant
       compliance),

   (2) has the ability to modulate operating cash flow weaknesses
       by temporarily limiting capital investment, and

   (3) will partially offset volatile food commodity costs through
       emphasizing different menu offerings.

The potential efficiencies from the company's position as the only
buffet/cafeteria restaurant operator with nationwide geographic
coverage (principally under the "Hometown Buffet" and "Old Country
Buffet" banners) also support the credit.

The negative outlook reflects Moody's opinion that the current
level of debt protection measures provides little cushion for the
assigned ratings.  Ratings would be adjusted downward if:

   (1) cash outflows for debt service and needed capital
       investment do not allow reduction in lease adjusted
       leverage and growth in fixed charge coverage,

   (2) the current level of operating performance does not
       improve, or

   (3) returns on capital investment in new stores and the
       forthcoming remodel program fall below expectations.

However, the ratings could remain at current levels if average
unit volume, customer traffic, and store level margin improve such
that debt protection measures make meaningful progress (including
lease adjusted leverage falling below 6 times and fixed charge
coverage approaching 1.5 times).

The B1 rating on the Opco bank loan (comprised of a $30 million
Revolving Credit Facility, a $20 million Letter of Credit
Facility, a $30 million Synthetic Letter of Credit Facility, and a
$207 million Term Loan) recognizes the security provided by
substantially all tangible and intangible assets of the company
and its operating subsidiaries.  The substantial amount of
subordinated debt results in notching above the senior implied
rating, in spite of the uncertainty of realizing value from
significant company assets such as leasehold improvements,
restaurant fixtures & equipment, and goodwill.

Moody's notes that continued compliance with tightening bank loan
covenants requires steady growth in operating cash flow.  As of
April 6, 2005, the company had $12 million of cash, $30 million of
revolving credit availability, and about $15 million in Letter of
Credit capacity.

The B3 rating on the Opco senior subordinated note issue reflects,
in spite of guarantees provided by the operating subsidiaries, the
seniority of the secured bank loan and $44 million of trade
accounts payable.  The bond indenture permits the incurrence of
additional Opco debt if the pro-forma consolidated coverage ratio
is greater than a certain level (currently 2.25 to 1).  The first
call date is in July 2006 at 105.625% of par.

The Caa1 rating on the Holdco senior discount note (2010) issue
considers that these notes, by being issued without guarantees
from Opco, are structurally subordinated to all obligations of
Opco and its subsidiaries.  Interest on the notes will accrete to
$132 million by July 2008 and then interest will be paid in cash
until the Dec. 2010 maturity.

For the four quarters ending April 2005, lease adjusted leverage
was very weak for the assigned ratings at about 6.6 times and
fixed charge coverage was low at about 1 time.  Restaurant margin
equaled 11.6% for the quarter ending April 6, 2005 compared to
14.0% in the same period of 2004 and comparable store sales for
the April 2005 quarter fell by 2% relative to the prior year.
Declining customer traffic has led to weak comparable store sales
and restaurant margins.  Moody's anticipates meaningful challenges
in building customer traffic and growing sales within the next
several quarters as the company improves marketing, implements a
more relevant menu, and upgrades the store environment.

Buffets, Inc., headquartered in Eagan, Minnesota, operates or
franchises 380 buffet-style restaurants principally under the
"Hometown Buffet" and "Old Country Buffet" banners.  Revenue for
the twelve months ending April 2005 equaled about $924 million.


CALL-NET: Rogers Communications Acquiring Company for $330 Million
------------------------------------------------------------------
Rogers Communications Inc. and Call-Net Enterprises Inc. entered
into a definitive agreement under which RCI will acquire 100% of
Call-Net in a share for share transaction under a plan of
arrangement.

Under the terms of the agreement, Call-Net Common and Class B
shareholders will receive a fixed exchange ratio of one RCI Class
B Non-voting share for each 4.25 outstanding shares of Call-Net,
representing a fully diluted equity value of approximately
$330 million.  In total, it is expected that upon closing of the
transaction approximately 9.0 million RCI Class B Non-voting
shares will be issued representing approximately 3.2% of the pro
forma shares outstanding.  Based upon the May 10, 2005 closing
price of the RCI Class B Non-voting shares, the transaction values
Call-Net at approximately $8.71 per share.  At March 31, 2005,
Call-Net had senior secured notes due 2008 of $269.8 million
outstanding and cash and short-term investments of $79.6 million.

"This acquisition will significantly jumpstart and expand our
ability to provide customers with a full suite of service
solutions that deliver the simplicity, quality and value they want
in one package, on one bill, from one provider," said Ted Rogers,
President and CEO of Rogers Communications Inc.  "This positions
us immediately to offer primary line telephone service across our
residential and business bases of wireless and cable customers.
It also provides a substantial additional base of customers to
cross-sell our portfolio of communications and entertainment
products and a skilled and knowledgeable employee group with
strengths in telephony sales and marketing.  As Rogers' cable
telephony service is deployed on a market by market basis, we will
be able to migrate Call-Net customers in our Rogers Cable
territory to our advanced digital cable telephony platform when
advantageous."

"This is a terrific day for Call-Net customers, shareholders,
employees, and for Canadian telecom in general," said Bill Linton,
President and CEO of Call-Net.  "We share a common heritage with
Rogers as a catalyst in bringing competition to the Canadian
communications markets.  By joining our business with one of the
foremost Canadian names in communications, entertainment and
information services, Call-Net customers will have a greatly
enhanced selection of advanced services to choose from in their
homes and businesses and the ability to enjoy the convenience of
complete multi-product bundles from a single provider.  The
combination of Rogers' innovative offerings and high quality
wireless and cable networks will bring tremendous additional
choice and value to our customers."

"This transaction offers an opportunity to acquire a significant
customer base and telecom assets that together provide network and
operating cost synergies and sales opportunities, which makes the
transaction attractive economically as well as strategically,"
added Ted Rogers.  "This will complement our deployment of an
advanced broadband IP multimedia network to support digital
voice-over-cable telephony and other new voice and data services
across the Rogers Cable service areas and expand the base of
customers that will benefit from them."

Call-Net, through its Sprint Canada subsidiary and with
approximately 1,800 employees, provides home phone and local
business service, IP data, long distance and wireless services to
approximately 600,000 consumers and business customers across
Canada, the majority of which are concentrated in areas served by
Rogers Cable. Call-Net owns a 14,000 route kilometre North
American transcontinental fibre optic broadband network that spans
across Canada and connects all major cities and into main U.S.
voice and data network access and peering points.  Call-Net also
has more than 150 central office co-location points in all of
Canada's largest markets as well as options to acquire significant
CLEC assets, including extensive local fibre in eastern Canada,
most of which are within Rogers Cable's serving areas.  Call-Net's
wireless services are offered to its customers, alone and in
bundles with other voice services, through a wholesale agreement
with Rogers' Fido division.

Rogers anticipates that it will realize cost savings from the
transaction, including reduced payments to incumbent and other
telecom providers.  The reduction in costs currently incurred by
Sprint Canada, Rogers Wireless and Rogers Cable include the areas
of local and long haul interconnection, the rental of local loops
and transport, Internet and other data transport costs, and the
costs associated with the transport of local and long haul
wireless traffic.

The boards of directors of Rogers and Call-Net have approved the
transaction, with the members of the Call-Net Board having agreed
that the transaction is fair to their shareholders and that they
will recommend that the Call-Net shareholders approve the
transaction at a Call-Net shareholder meeting expected to be held
before June 30, 2005.

BMO Nesbitt Burns is acting as financial advisor to Call-Net on
this transaction and has provided Call-Net's Board of Directors
with a fairness opinion that the consideration to be received
under the Plan of Arrangement is fair, from a financial point of
view, to the shareholders of Call-Net.  Scotia Capital is acting
as financial advisor to Rogers on this transaction.

Subject to certain customary conditions, including among others,
regulatory approvals and acceptance by Call-Net shareholders
representing at least two-thirds of the votes cast in respect of
the Plan of Arrangement, this transaction is expected to close
during the third quarter of 2005.  The transaction is expected to
be accounted for as a purchase and it is anticipated that the
share-for-share exchange will be structured as tax-free to
eligible Canadian shareholders.  Call-Net has agreed not to
solicit or take certain other actions with respect to any
competing proposal, and in addition has agreed to pay Rogers a
termination fee of $10 million under specified conditions.

A proxy circular relating to the transaction is expected to be
sent to Call-Net's shareholders prior to the end of May 2005.
Investors are urged to read the proxy circular regarding the
transaction when it becomes available, as it will contain
important information.

Holders of Call-Net Common shares and Class B Non-Voting shares
are reminded that

     (i) each Common share may, at the option of the holder, be
         exchanged at any time for one Class B Non-Voting share
         and

    (ii) each Class B Non-Voting share may, at the option of the
         holder by providing a declaration of Canadian residency
         to Call-Net's transfer agent, be exchanged at any time
         for one voting Common share.

                    About Rogers Communications

Rogers Communications, Inc., (TSX: RCI; NYSE: RG) is a diversified
Canadian communications and media company engaged in three primary
lines of business.  Rogers Wireless is Canada's largest wireless
voice and data communications services provider and the country's
only carrier operating on the world standard GSM/GPRS technology
platform; Rogers Cable is Canada's largest cable television
provider offering cable television, high-speed Internet access and
video retailing; and Rogers Media is Canada's premier collection
of category leading media assets with businesses in radio,
television broadcasting, televised shopping, publishing and sport
entertainment.

                         About Call-Net

Call-Net Enterprises Inc. (TSX: FON, FON.NV.B), primarily through
its wholly owned subsidiary Sprint Canada Inc., is a leading
Canadian integrated communications solutions provider of home
phone, wireless, long distance and IP services to households, and
local, long distance, toll free, enhanced voice, data and IP
services to businesses across Canada.  Call-Net, headquartered in
Toronto, owns and operates an extensive national fibre network,
has over 151 co-locations in five major urban areas including 33
municipalities and maintains network facilities in the U.S. and
the U.K.  For more information, visit http://www.callnet.ca/and
http://www.sprint.ca/

                         *     *     *

As reported in the Troubled Company Reporter on Apr. 25, 2005,
Moody's has upgraded Call-Net Enterprises Inc.'s Senior Implied
rating to B3 from Caa2, upgraded its Senior Secured rating to B3
from Caa3 and upgraded its Issuer rating to Caa1 from Ca.  Moody's
says the outlook is stable.

Debt affected by this action:

   * 10.625% Senior Secured Notes, (upgraded to B3 from Caa3)
     US$223 million

As additionally reported in the Troubled Company Reporter on
Dec. 3, 2004, Standard & Poor's Ratings Services lowered its
ratings on Call-Net Enterprises, Inc., to 'B-' from 'B' on
continued pricing pressures in long distance and expectations for
increased competition in residential local services beginning in
2005.  At the same time, Standard & Poor's lowered the ratings on
Call-Net's 10.625% notes due Dec. 2008; US$223.1 million remains
outstanding under the notes.  S&P says the outlook remains
negative.


CALL-NET: Deal with Rogers Prompts 's Positive CreditWatch
----------------------------------------------------------
Standard & Poor's Ratings Services placed its 'B-' long-term
corporate credit and senior secured debt ratings on Call-Net
Enterprises Inc. on CreditWatch with positive implications
following the announced definitive agreement between Call-Net and
Rogers Communications Inc. (RCI; BB/Stable/B-2) under which RCI
will acquire 100% of Call-Net in an all-stock transaction.

"The degree of implied or actual credit support for Call-Net from
RCI has yet to be established; however, this is a positive credit
event for Call-Net," said Standard & Poor's credit analyst Joe
Morin.  RCI's purchase of Call-Net will enhance Roger's presence
in the nationwide telecommunications segment, both business and
residential..

RCI's intentions with respect to Call-Net's debt are unclear at
present.  Should RCI keep Call-Net as a separate operating
subsidiary and maintain its debt outstanding, the stand-alone
ratings on Call-Net will be maintained.  The ratings on Call-Net
would likely move higher, but would not likely be equalized with
the ratings on RCI, as no direct credit support from RCI would be
expected.  If RCI redeems all debt outstanding at Call-Net, the
ratings on Call-Net would likely be withdrawn.

The stand-alone ratings on Call-Net Enterprises Inc. reflect its:

    (1) weak business profile, given its significant exposure to
        the long-distance market,

    (2) a small customer base, and

    (3) a narrower range of services offered relative to
        its larger competitors (Bell Canada, Telus Corp.).

Call-Net's financial risk profile is also weak due to poor
liquidity and financial flexibility.  Standard & Poor's
expectations for long-term improvement are limited given
relatively poor growth prospects for the company.

To date, Call-Net has been able to largely offset pricing
pressures in its long-distance segment through growth in local
services, and by the bundling of local with long-distance
services.  Revenues and EBITDA were marginally higher in 2004
compared with 2003, with further growth demonstrated in first-
quarter 2005 due to local revenue growth and the acquisition of a
number of business lines from Bell Canada.  Standard & Poor's,
however, expects that pricing competition in local services will
become a factor in 2006, as the cable companies and other voice
over Internet protocol providers have begun offering telephony
service at discounted rates.

Call-Net has been protected from price competition in local
services as they have competed only with the incumbent telecom
operators, which are not permitted to lower rates under current
regulatory restrictions.  Increased competition for local services
will likely put pressure on Call-Net's pricing beginning in 2006.
Call-Net will also be challenged to compete effectively given its
relatively limited product offering, which does not currently
include a high-speed Internet (HSI) service to residential
customers.

Call-Net plans to offer digital subscriber line services to
residential customers beginning in third-quarter 2005; however,
the company has limited financial resources to make an aggressive
push into HSI and the period of rapid growth for HSI has passed.
Intense pricing pressure in the long-distance and wholesale data
markets will also continue.


CARDIMA INC: Posts $2 Million Net Loss in First Quarter 2005
------------------------------------------------------------
Cardima(R), Inc. (Nasdaq SC: CRDM) reported financial results for
the first quarter ended March 31, 2005.

Net sales for the first quarter ended March 31, 2005 decreased 13%
to $555,000 from $636,000 for the same period in 2004.  United
States derived net sales fell 15% to $268,000 in the first quarter
of 2005, compared with $317,000 in the same period of 2004.
European derived net sales decreased 47% to $68,000 from $129,000
for the first quarters of 2005 and 2004, respectively.  Net sales
in Japan (Asia) increased 18% or $34,000 to $219,000 in the first
quarter of 2005 from $185,000 for the same prior year period.

Net loss for the first quarter of 2005 decreased 1% or $29,000 to
$2,329,000, compared with $2,358,000, for the first quarter of
2004.  Operating expenses increased 22% to $2,697,000 for the
first quarter of 2005 from $2,215,000 for the same period in 2004.
Selling, general and administrative expenses increased 38% or
$470,000 to $1,697,000 from $1,227,000 for the first quarters of
2005 and 2004, respectively.  This increase was due to the
implementation of a Sarbanes-Oxley compliance program in the first
quarter of 2005.  Research and development expenses decreased 35%
to $642,000 in the first quarter of 2005 from $988,000 for the
first quarter of 2004.  Shares used in calculating the net loss
per share increased to 101.4 million shares outstanding from 82.1
million shares.  The increase in shares was due to the issuance of
shares in connection with the private placement in November 2004.


                     About the Company

Cardima, Inc. has developed the REVELATION(R) Tx, REVELATION T-
Flex and REVELATION Helix linear ablation microcatheters, the
NAVIPORT deflectable guiding catheters, and the INTELLITEMP energy
management system for the minimally invasive treatment of atrial
fibrillation (AF).  The REVELATION Helix was developed for the
treatment of AF originating in the pulmonary veins of the heart.
The REVELATION Tx, REVELATION T-Flex and REVELATION Helix systems
and the INTELLITEMP have received CE Mark approval in Europe.  The
Company has also developed a Surgical Ablation System, which is
intended for cardiac surgeons use in ablating cardiac tissue
during heart surgery using radio frequency (RF) energy.  In
February 2003, the Company announced that it had received FDA
510(k) clearance to market the Surgical Ablation System in the
U.S. for use in ablating cardiac tissue.

                        *     *     *

                     Going Concern Doubt

As reported in the Troubled Company Reported on Apr. 13, 2005, BDO
Seidman LLP expressed substantial doubt about Cardima(R),
Inc.'s ability to continue as a going concern after it completed
an audit of the company's financial statements for the year ended
Dec. 31, 2004.  The Company delivered a copy of its annual report
to the Securities and Exchange Commission last week.  A similar
explanatory paragraph has been included in Annual Report filings
in each of the past three years by the Company's independent
auditor.

The Company has suffered recurring losses from operations and has
a net capital deficiency that raises substantial doubt about its
ability to continue as a going concern.  At March 31, 2005, the
Company had approximately $1.7 million in cash and cash
equivalents.  Based on its 2005 operating plan, the Company
believes that its cash balances as of March 31, 2005, will only
provide sufficient capital to fund operations for a very limited
period of time and will not be sufficient to fund operations into
the third quarter of 2005.  The Company is exploring potential
funding opportunities including the sale of equity securities or
entering into a strategic transaction relating to its Surgical
Ablation System.


CARROLS CORP: Form 10-K Filing Delay Prompts S&P to Junk Ratings
----------------------------------------------------------------
Standard & Poor's Ratings Services lowered its ratings on
Syracuse, N.Y.-based Carrols Corp. and placed them on CreditWatch
with developing implications.  Both the corporate credit rating
and the senior secured bank loan rating were lowered to 'CCC+'
from 'B+', while the senior subordinated debt rating was lowered
to 'CCC-' from 'B-.'

"The downgrade and CreditWatch listing follow the company's
disclosure that an event of default occurred under its senior
credit facility as a result of Carrols' failure to timely furnish
its audited financial statements for fiscal year 2004," said
Standard & Poor's credit analyst Kristi Broderick.

The senior secured credit facility is comprised of a $50 million
five-year revolving credit facility and a $220 million six-year
term loan B.  Carrols has no outstanding borrowings (excluding
$10.8 million of outstanding letters of credit) under the
revolving credit facility and has $219.5 million principal
outstanding on its term loan B.

The company's delayed filing of its annual 10-K relates to a re-
evaluation of accounting practices with respect to depreciation
for leasehold improvements and buildings on leased land and its
review of its accounting practices with respect to amortization of
certain intangible assets and accounting for stock options.  While
Carrols has not yet filed its annual 10-K, it has concluded that
it would be necessary to restate its financial statements for
periods ended prior to Jan. 2, 2005.

The event of default enables the lenders to terminate the
revolving credit facility and accelerate the outstanding principal
due on the term loan.  This would clearly have an adverse effect
on Carrols' financial condition.

Carrols is in discussions with its lenders to obtain a waiver
regarding this default.  If the company is not able to secure a
waiver, ratings will be lowered further.  However, if the company
secures a waiver and files its 10-K, the ratings could be raised
upon review of its annual filing.  In either situation, the
ratings would also be subject to further review of the company's
financial controls and policies.

Carrols is one of the largest Burger King franchisees, with more
than 550 restaurants in 16 states under the Burger King, Pollo
Tropical, and Taco Cabana brands.


CATHOLIC CHURCH: Portland Wants Exclusive Periods Extended
----------------------------------------------------------
Before the Petition Date, the Archdiocese of Portland in Oregon
had successfully settled over 100 claims.  However, many of its
insurers were denying coverage for those claims and were refusing
to participate in settlements.  As a result, Portland filed an
$18 million claim against its insurers for failure to participate
in the defense and settlement of the claims.

Portland believes it is entitled to coverage from its insurers for
those pending and future claims, which have not been settled.
Portland has instituted litigation against its insurers in the
U.S. Bankruptcy Court for the District of Oregon to determine the
coverage issues and the liability of Portland's insurers for
payment of the tort claims.  The parties have commenced discovery
and a further status conference will be held on May 24, 2005.

The Future Claimants Representative has also filed claims against
Portland in an unliquidated amount on behalf of future claimants.
The Court appointed Hamilton, Rabinovitz & Alschuler, Inc., to
formulate a model and gather data to provide an estimate of the
number and amount of legitimate claims anticipated to be asserted
by the Future Claimants.  It is anticipated that Hamilton will not
be able to complete its estimation analysis until at least the
first round of mediations under the Accelerated Claims Resolution
Procedure has been concluded in September 2005.

According to Thomas W. Stilley, Esq., at Sussman Shank LLP, in
Portland, Oregon, the Archdiocese has commenced discovery to
enable the first round of mediations to take place.  The first
round of mediations will include claims filed prior to January 1,
2005, or where agreement is reached to include the claim in the
first round of mediations.  These mediations are scheduled to
begin the week of August 8, 2005.

Upon completion of the first round of mediations, Portland will
commence discovery on all remaining tort claims filed between
January 1, 2005, and April 29, 2005.  Following completion of the
discovery, the second round of mediations will be commenced for
all remaining tort claims.  Upon conclusion of the second round,
Portland anticipates that its liability on most of the claims will
have been established.

Mr. Stilley relates that at this time, Portland has not yet
determined the total number of claims asserted against it or the
alleged factual basis for those claims by persons who elect to
file claims.  A lot of complex issues also remain unsolved
including:

   (i) the insurers' liability;

  (ii) the pending Adversary Proceeding regarding property of the
       estate;

(iii) mediations under the Accelerated Claims Resolution
       Procedure; and

  (iv) estimation of the claims of the Future Claimants.

Portland has not yet formalized its Plan of Reorganization because
the amount of claims is still far from certain.  It is also
unclear what property must be included in Portland's estate which
would be available to pay claims.

Until a large portion of the claims are resolved, or the property
of the estate litigation concluded, it will be almost impossible
for Portland to propose a plan that could be confirmed.  Only
after further progress has been made in answering these questions
will Portland be in a position to propose a confirmable plan, Mr.
Stilley says.

For these reasons, Portland asks the Court to further extend the
period within which it has the exclusive right to:

    * file a plan until December 31, 2005; and

    * obtain acceptance of the plan until March 1, 2006.

Mr. Stilley explains that the purpose of the seven-month extension
is principally to provide sufficient time for:

   (a) Portland to identify the number and amount of tort claims
       being asserted against it through the proofs of claim
       filing process;

   (b) Portland to complete the first round of mediations under
       the ACRP to liquidate what it believes will be a
       significant amount of the known tort claims;

   (c) Hamilton to complete its estimation of the legitimate
       claims, which can be expected to be asserted by the Future
       Claimants;

   (d) Portland to attempt to resolve or litigate the disputes
       with its insurers over coverage issues to obtain a portion
       of the funding to pay claims;

   (e) Portland to attempt to resolve the Tort Claimant
       Committee's Adversary Proceeding to determine the property
       of the estate; and

   (f) discussion and negotiation of a consensual Plan of
       Reorganization with the Tort Claimants Committee, the
       Future Claimants Representative, individual tort
       claimants, insurers, and other stakeholders like the
       parishes and parishioners.

Mr. Stilley assures Judge Perris that the extension is not
intended to pressure creditors to submit to Portland's demands,
and will not prejudice any creditors' interest.

The Archdiocese of Portland in Oregon filed for chapter 11
protection (Bankr. Ore. Case No. 04-37154) on July 6, 2004.
Thomas W. Stilley, Esq., and William N. Stiles, Esq., at Sussman
Shank LLP, represent the Portland Archdiocese in its restructuring
efforts.  In its Schedules of Assets and Liabilities filed with
the Court on July 30, 2004, the Portland Archdiocese reports
$19,251,558 in assets and $373,015,566 in liabilities.  (Catholic
Church Bankruptcy News, Issue No. 25; Bankruptcy Creditors'
Service, Inc., 215/945-7000)


CELLSTAR CORP.: Warns of Default Under Wells Fargo Loan Agreement
-----------------------------------------------------------------
CellStar Corporation (Nasdaq: CLSTE) hasn't filed a Form 10-Q or
Form 10-K with the Securities and Exchange Commission since Oct.
14, 2004.  The value-added wireless logistics and distribution
services company says it's been unable to file its 2004 Annual
Report and its First Quarter Form 10-Q as a result of "accounting
issues related to certain accounts receivable and revenues in its
Asia Pacific Region."

CellStar says management has undertaken an intense review in the
Asia Pacific Region consisting of interviews with personnel
directly involved with the subject matter of the claims, a review
of documentation related to the claims, and discussions with the
Company's distribution network.  The Audit Committee of the Board
of Directors engaged independent counsel and the Company's
internal auditors to assist in the oversight of this process.

The Company says it is nearing completion of its review of the
accounts receivable and revenues and is working with its
independent auditor, Grant Thornton LLP, and its former
independent auditor, KPMG LLP, to finalize the accounting
treatment for the issues raised.  KPMG LLP was the Company's
independent auditors prior to fiscal 2003.  Management currently
believes that adjustments to the Company's previously reported
financial results will be required.

Wells Fargo Foothill, CellStar's secured lender, has been patient
and has waived the reporting defaults through May 16, 2005.  The
Company believes it will be successful in getting that date
extended to May 31, 2005.

The Company warns that once the delinquent Form 10-K and Form 10-Q
are filed, it will be in violation of certain financial covenants
in the revolving credit facility.  The Company believes it will be
able to obtain a waiver of the violations from Wells Fargo
Foothill, but cautions there's no assurance that will happen.

CellStar Corporation is a leading global provider of value added
logistics and distribution services to the wireless communications
industry, with operations in the Latin American, North American
and Asia-Pacific Regions.  CellStar facilitates the effective and
efficient distribution of handsets, related accessories and other
wireless products from leading manufacturers to network operators,
agents, resellers, dealers and retailers.  CellStar also provides
activation services in some of its markets that generate new
subscribers for its wireless carriers.  CellStar hosts a Web site
at http://www.cellstar.com/


CHASE COMMERCIAL: Moody's Puts Low-B Ratings on Six Cert. Classes
-----------------------------------------------------------------
Moody's Investors Service upgraded the ratings of three classes
and affirmed the ratings of eleven classes of Chase Commercial
Mortgage Securities Corp., Commercial Mortgage Pass-Through
Certificates, Series 2000-2 as follows:

   * Class A-1, $80,722,412, Fixed, affirmed at Aaa
   * Class A-2, $442,457,420, Fixed, affirmed at Aaa
   * Class X, Notional, affirmed at Aaa
   * Class B, $26,779,086, Fixed, upgraded to Aa1 from Aa2
   * Class C, $34,166,423, Fixed, upgraded to A1 from A2
   * Class D, $12,004,419, Fixed, upgraded to A2 from A3
   * Class E, $23,085,420, WAC, affirmed at Baa2
   * Class F, $12,927,835, WAC, affirmed at Baa3
   * Class G, $12,927,835, Fixed, affirmed at Ba1
   * Class H, $18,468,337, Fixed, affirmed at Ba2
   * Class I, $5,540,501, Fixed, affirmed at Ba3
   * Class J, $7,387,334, Fixed, affirmed at B1
   * Class K, $7,387,335, Fixed, affirmed at B2
   * Class L, $3,693,667, Fixed, affirmed at B3

As of the April 15, 2005 distribution date, the transaction's
aggregate principal balance has decreased by approximately 5.2% to
$700.5 million from $738.7 million at securitization.  The
Certificates are collateralized by 80 loans secured by commercial
and multifamily properties.  The loans range in size from less
than 1.0% to 6.0% of the pool, with the ten largest loans
representing 41.7% of the outstanding pool balance.  Nine loans,
representing 7.1% of the pool balance, have defeased and are
collateralized by U.S. Government securities.  No loans have been
liquidated from the trust and there are no realized losses.

One loan, representing 0.9% of the pool, is in special servicing.
Moody's estimates a loss of approximately $2.0 million for this
loan.  Twenty-two loans, representing 36.8% of the pool, are on
the master servicer's watchlist.

Moody's was provided with partial or year-end 2004 operating
results for 92.1% of the performing loans.  Moody's loan to value
ratio is 83.3%, compared to 84.3% at securitization.  Based on
Moody's analysis, 9.2% of the pool has a LTV greater than 100.0%,
compared to 0.0% at securitization.  The upgrade of Classes B, C
and D is due to increased subordination levels and stable overall
pool performance.

The top three loans represent 16.6% of the pool.  The largest loan
is the 111 Livingston Street Loan ($42.0 million - 6.0%), which is
secured by a 406,000 square foot Class B office building in
Brooklyn, New York.  The largest tenants are the Legal Aid Society
(20.0% NRA; lease expiration in 2017) and the State of New York
Disability Office (19.0%; lease expiration in 2010).  The loan is
on the master servicer's watchlist due to the failure of the
borrower to complete substantial required repairs by a specified
due date.  The property's performance has improved since
securitization.  Moody's LTV is 68.9%, compared to 73.9% at
securitization.

The second largest loan is the 32-42 Broadway Loan ($38.5 million
- 5.5%), which is secured by two Class B office buildings located
in lower Manhattan in New York City.  The properties' performance
has been stable since securitization despite a decrease in
occupancy to 82.6% from 95.1% at securitization.  Moody's LTV is
79.7%, compared to 82.5% at securitization.

The third largest loan is the Embassy Suites Atlanta-Buckhead Loan
($35.9 million -- 5.1%), which is secured by 317-room full service
hotel located in the Buckhead area of Atlanta, Georgia.  This loan
is on the master servicer's watchlist because of low debt service
coverage.  Occupancy and ADR are 73.2% and $124.43, compared to
77.1% and $142.87 at securitization.  RevPAR has decreased to
$91.02 from $110.15 at securitization.  Moody's LTV is 97.3%,
compared to 76.9% at securitization.

The collateral properties are located in 19 states with
approximately 68.4% of the pool balance concentrated in five
states.  The highest state concentrations are:

            * California (23.3%),
            * New York (17.7%),
            * Texas (10.5%),
            * Florida (8.5%), and
            * Georgia (8.4%).

The pool's collateral is a mix of:

            * retail (28.7%),
            * office (27.1%),
            * multifamily (23.4%),
            * lodging (8.7%),
            * U.S. Government securities (7.1%),
            * industrial (4.7%), and
            * credit tenant leases (0.3%).

All of the loans are fixed rate.


CHYRON CORP: March 31 Balance Sheet Upside-Down by $1.6 Million
---------------------------------------------------------------
Chyron Corporation (OTCBB: CYRO) reported that for its first
quarter, the Company generated revenues of $6.0 million and
incurred a net loss of $0.3 million.  The Company's new
microcasting and digital displays product, ChyTV, was launched in
the quarter and net costs associated with it accounted for the
quarter's net loss, with the remainder of the Company's business
approximately breaking even.

Revenues for the first quarter were slightly higher than the $5.8
million reported for the same quarter last year, with
substantially no sales contribution from the new ChyTV product.
ChyTV was debuted in March at the NSCA Show in Orlando and in
April, subsequent to the end of the first quarter, at the Las
Vegas annual meeting of the National Association of Broadcasters,
where it was met with considerable enthusiasm and won a
prestigious "Pick Hit" of the Show award from Video Systems
Magazine.

CEO and President Michael Wellesley-Wesley commented, "Despite our
somewhat muted first-quarter performance we remain confident that
the improving trend in our operating metrics is gaining momentum.
Several broadcast graphics orders that were expected to close in
the first quarter were deferred until after the NAB tradeshow in
early April.  These orders have since been received, so we look
forward to the medium term with some confidence.  The launch of
ChyTV went smoothly, and we remain convinced that ChyTV represents
an important element in our future.  The initial costs of this new
product line are merely the necessary price we have to pay to move
Chyron into the microcasting and digital displays business."

The net loss for the first quarter represented a downtick compared
to net income of $0.3 million, for the first quarter of 2004,
generated entirely from the real-time broadcast graphics business.
Most of the previous year's first-quarter net income resulted from
a gain on the sale of marketable securities of $200,000.

Gross margins for this year's first quarter were 59 percent
compared to 61 percent in last year's comparable quarter.  The
gross margin variance was primarily due to differences in product
mix and slightly lower average selling prices on certain products.

Operating expenses of $3.7 million for the first quarter of 2005
were $0.4 million higher than the first quarter of 2004, primarily
due to expenditures of $0.3 million related to the microcasting
and digital displays business, severance costs of $0.1 million,
professional fees for Sarbanes-Oxley compliance and new systems
and other consulting fees of $0.1 million, and higher employee
benefits costs of $0.1 million, offset by lower project materials
costs of $0.1 million and lower payments to consultants in the
research and development group of $0.1 million.

At March 31, 2005 the Company had cash on hand of $1.2 million and
working capital of $3.7 million.  During the first quarter of 2005
net cash of $0.4 million was used by operations, including $0.3
million from changes in operating assets and liabilities.  Cash of
$1.26 million was used to retire early one-half of the Company's
Series C Subordinated Convertible Debentures, as was previously
reported.  These debentures were originally scheduled to mature
December 31, 2005.  The maturity date for the balance of the
debentures was extended to April 30, 2006.

                          About the Company

With unwavering clarity of vision, Chyron Corporation --
http://www.chyron.com/-- continues to define and dominate the
world of broadcast graphics.  Winner of numerous awards, including
two Emmys, Chyron has proven itself as the undisputed leader in
the industry.  From the compact Micro-X to the blazing Hyper-X
SD/HD, Chyron's exceptional Duet product line brings unmatched, 2D
and 3D graphics creation and performance to the most demanding
studio and mobile operations.  Rounding out Chyron's graphics
offerings are still and clip servers, ticker and telestration
systems, and MOS newsroom integration solutions.  The ChyTV
product line leverages Chyron's broadcast expertise with video
graphics devices for microcasting and digital displays. Chyron has
a unique, 30-year history of service and support for its products
that far exceeds that of most manufacturers.

At Mar. 31, 2005, Chyron Corporation's balance sheet showed a
$1,592,000 stockholders' deficit, compared to a $1,321,000 deficit
at Dec. 31, 2004.


CMACAO: Case Summary & 20 Largest Unsecured Creditors
-----------------------------------------------------
Debtor: CMACAO
        aka Columbus Metropolitan Area Community
        Action Organization, Inc.
        700 Bryden Road
        Columbus, Ohio 43215
        Tel: (614) 324-5123

Bankruptcy Case No.: 05-58115

Type of Business: The Debtor is a private, nonprofit, social
                  service corporation.  See http://www.cmacao.org/

Chapter 11 Petition Date: May 11, 2005

Court: Southern District of Ohio (Columbus)

Debtor's Counsel: Grady L. Pettigrew, Esq.
                  Cox Stein & Pettigrew Co LPA
                  115 West Main, 4th floor
                  Columbus, Ohio 43215
                  Tel: (614) 224-1113
                  Fax: (614) 228-0701

Estimated Assets: Unstated

Estimated Debts:  $1 Million to $10 Million

Debtor's 20 Largest Unsecured Creditors:

   Entity                                   Claim Amount
   ------                                   ------------
Associated Plan Administrators                $1,830,681
Erik Erne
P.O. Box 9568
New Haven, CT 06535

Ohio Dept of Education                          $913,211
9772 Princeton Pike, Suite 3
Cincinnati, OH 45246

Administration for Children and Families        $525,000
233 North Michigan Avenue
Chicago, IL 60601

Huntington National Bank                        $500,000
7575 Huntington Park Drive
Columbus, OH 43235

Southwestern City Schools                       $474,425
3805 Marlane Drive
Grove City, OH 43123

Associated Plan Administrators                  $253,067
Erik Erne P.O. Box 9568
New Haven, CT 06535-9568

Lincoln National Corp                           $213,542
P.O. Box 2212
Fort Wayne, IN 46801

Ohio Dept of Development                        $132,552
77 South High Street
Columbus, OH 43216

Medco Health Solutions Inc.                      $72,076
Wachovia Operation Center
P.O. Box 945551
Atlanta, OH 30394-5551

Otto Beatty Co. LPA Inc.                         $41,988
233 South High Street, Suite 300
Columbus, OH 43215-4511

Porter Wright Morris & Arthur                    $33,875
41 South High Street
Columbus, OH 43215-6194

Bus Service Inc.                                 $31,931
3153 Lamb Avenue
Columbus, OH 43219

Mothers Helper Childcare #2                      $27,340
712 East Spring Street
Columbus, OH 43203

FCI TOO                                          $26,634
2511 Mock Road
Columbus, OH 43219

Johnson Controls Inc.                            $21,068
4741 Hilton Corporate Drive
Columbus, OH 43232

Natl Premier Protective Serv                     $20,053
100 Center Street, Suite 201
Chardon, OH 44024

Abbott Foods                                     $19,960
P.O. Box 44466
Columbus, OH 43204

Herman Miller Capital Corp.                      $19,892
1255 Wrights Lane
West Chester, PA 19380

Neighborhood House Inc.                          $18,714
1000 Atcheson Street
Columbus, OH 43203

Lending Hand Day Care Learning Center            $18,490
2154 Parkwood Avenue
Columbus, OH 43211


CONGOLEUM CORP: AIG Companies Settle Asbestos Claims for $103 Mil.
------------------------------------------------------------------
Congoleum Corporation (AMEX:CGM) has reached a settlement
agreement with one of its excess insurance carriers over coverage
for asbestos-related claims.  Under the terms of the settlement,
certain AIG companies will pay $103 million over ten years to the
trust to be formed upon confirmation of Congoleum's proposed
amended plan of reorganization.  The settlement resolves coverage
obligations of policies with a total of $114 million in liability
limits for asbestos bodily injury claims, and is subject to final
court approval and effectiveness of Congoleum's proposed amended
plan of reorganization.

Roger S. Marcus, Chairman of the Board, commented, "We are pleased
to have resolved our dispute with this carrier, and we are hopeful
that additional negotiations presently underway will lead to
further settlements with other carriers in the near future.  This
agreement, together with a previously announced $15 million
settlement and the expected contribution from Congoleum, will
provide the resources to pursue insurance coverage from other
carriers through litigation where necessary and will permit the
trust to be formed upon Congoleum's reorganization to begin the
payment of allowed claims immediately upon confirmation.  We
believe this represents another major step forward in our journey
to put our asbestos exposure behind us."

On December 31, 2003, Congoleum Corporation filed a voluntary
petition with the United States Bankruptcy Court for the District
of New Jersey (Case No. 03-51524) seeking relief under Chapter 11
of the United States Bankruptcy Code as a means to resolve claims
asserted against it related to the use of asbestos in its products
decades ago.

Congoleum Corporation is a leading manufacturer of resilient
flooring, serving both residential and commercial markets.  Its
sheet, tile and plank products are available in a wide variety of
designs and colors, and are used in remodeling, manufactured
housing, new construction and commercial applications.  The
Congoleum brand name is recognized and trusted by consumers as
representing a company that has been supplying attractive and
durable flooring products for over a century.  Congoleum is a 55%
owned subsidiary of American Biltrite Inc. (AMEX:ABL).

Headquartered in Mercerville, New Jersey, Congoleum Corporation --
http://www.congoleum.com/-- manufactures and sells resilient
sheet and tile floor covering products with a wide variety of
product features, designs and colors.  The Company filed for
chapter 11 protection on December 31, 2003 (Bankr. N.J. Case No.
03-51524) as a means to resolve claims asserted against it related
to the use of asbestos in its products decades ago. Domenic
Pacitti, Esq., at Saul Ewing, LLP, represents the Debtors in their
restructuring efforts.  When the Company filed for protection from
its creditors, it listed $187,126,000 in total assets and
$205,940,000 in total debts.

At Mar. 31, 2005, Congoleum Corporation's balance sheet showed a
$21,341,000 stockholders' deficit, compared to a $20,989,000
deficit at Dec. 31, 2004.


CNET NETWORKS: Good Performance Prompts S&P's Positive Outlook
--------------------------------------------------------------
Standard & Poor's Ratings Services revised its outlook on Internet
publisher CNET Networks Inc. to positive from stable.  At the same
time, Standard & Poor's affirmed its 'B-' corporate rating on
CNET.  Total debt outstanding was about $146 million on March 31,
2005.

"The outlook revision is based on CNET's improving financial
performance and improved prospects for positive discretionary cash
flow in 2005, driven by strong Internet ad demand," said Standard
& Poor's credit analyst Andy Liu.  The rating could be upgraded if
the company can demonstrate ability to maintain consistently
strong credit ratios and positive discretionary cash flow.
Marketers are currently showing more commitment to online
advertising than they have before, and it remains unclear how the
company would fare in a weak online advertising environment.
However, the outlook could be revised to stable or even to
negative if share repurchases, cash acquisitions, and/or business
underperformance erode credit measures or pressure liquidity.

The speculative-grade ratings on CNET Networks Inc. reflect:

    (1) the company's dependence on online advertising,

    (2) an acquisition-oriented growth strategy, and

    (3) high financial risks.

These risks are only slightly offset by CNET's position as a
leading publisher of consumer electronic products reviews and
strong Internet ad demand.

CNET's electronics products and video games niche in Internet
publishing is almost entirely advertising driven, which renders it
highly vulnerable to the ebb and flow of the advertising cycle.
For that reason, the company went through a difficult period after
the Internet bubble in 2001-2002.  Currently, however, CNET is
benefiting from the growth in demand for online advertising,
which, according to the Interactive Advertising Bureau, grew more
than 32% in 2004.

CNET also benefits from a growing user base.  The company's
network unique users increased 38% in March 2005 from the prior
year, and network average daily page views rose 114%.  These
operating metrics indicate that more consumers are using CNET Web
sites as an information source and spending more time on them.  A
continuation of these trends will make CNET more valuable to
advertisers and contribute to revenue and EBITDA growth.

Recent acquisitions, including Webshot and several Chinese Web
sites, have increased ad inventory and modestly improved business
diversity.  On the other hand, CNET's publishing operations, which
are significantly smaller at about 10% of revenues, continue to
decline as custom publishing clients cut back on prints.


COGENTRIX ENERGY: Moody's Assigns Ba2 Senior Implied Rating
-----------------------------------------------------------
Moody's Investors Service affirmed the Ba2 rating for the
$750 million senior secured credit facilities of Cogentrix
Delaware Holdings, Inc. -- CDHI. Moody's also assigned a Ba2
Senior Implied rating to Cogentrix Energy, Inc. -- CEI, the parent
of CDHI, and affirmed the Aa3 rating for CEI's $354 million senior
unsecured notes that are guaranteed by The Goldman Sachs Group,
Inc.  The rating outlook is stable for both CEI and CDHI.

CDHI's new credit facilities closed on April 14, 2005.  The credit
facilities were structured as a $700 million seven-year secured
term loan and a $50 million five-year secured revolving credit
facility.  Borrowings under the term loan facility were used to
repay an affiliate acquisition bridge loan and to replace existing
bank credit facilities.  The bridge loan had been used to fund the
acquisition of equity interests in eleven power plants, an equity
interest in a natural gas pipeline and related assets from
National Energy & Gas Transmission, Inc.

The Ba2 Senior Implied rating reflects the predictable cash flows
that Cogentrix derives from a diverse portfolio of generating
assets operating under long-term contracts with creditworthy
utility counterparties.  The rating also considers high
consolidated leverage, and the large amount of non-recourse debt
at subsidiaries and projects in which Cogentrix has an ownership
interest.

CEI is headquartered in Charlotte, North Carolina, and is the
parent company of CDHI.


COLETO CREEK: Moody's May Pare Ratings Due to Slow Debt Reduction
-----------------------------------------------------------------
Moody's Investors Service placed the Ba2 first lien and Ba3 second
lien ratings of the credit facilities of Coleto Creek WLE, LP
under review for possible downgrade.

The review is prompted by changes that Moody's believes will
result in a slower pace for debt reduction over the immediate
term:

   1) A proposed amendment to Coleto's credit facilities that
      would provide for the incurrence of additional debt of
      $35 million and allow the proceeds, along with $15 million
      of cash currently trapped at the project, to be used to pay
      a $50 million special dividend,

   2) Somewhat lower than previously expected projected funds from
      operations as a result of significant increases in projected
      contracted fuel costs that will not be entirely offset by
      reductions in other operating costs and better than expected
      plant performance, and

   3) Thinner projected debt service ratios, which result from
      weaker FFO and significant capital spending for
      environmental projects and to convert the generating
      facility to a fuel source capability of 100% low-sulfur
      Powder River Basin coal, which will require approximately
      $70 million of capital expenditures between 2006 and 2008.

The review will focus on Coleto's proposed amendment to its credit
facilities and recognizes that the proposal has not yet been
approved by the lenders.  Should the amendment be accepted in a
form similar to its current proposal, we would expect the ratings
of both the first and second lien facilities to be lowered by one
notch.

Coleto's planned increase in debt, combined with its renewed plans
to convert the project into a facility that is capable of
utilizing 100% PRB coal, have delayed the originally anticipated
deleveraging of the project.  Coleto's projected fuel costs have
also increased significantly, although these cost have been
somewhat offset by reductions in property taxes, reduced cost for
emissions allowances and lower assumed interest rates.  If the
amendment is accepted, Coleto's funds from operations as a
percentage of total debt is projected to remain around 12% to 13%
through 2008.  Approximately 75% of the original term loan B
balance is expected to be outstanding in 2009 when the majority of
the current contracts expire.  Annual debt service coverage would
be significantly lower than Moody's previous expectations. In
2007, when significant capital expenditures are planned, cash
available for required (1% amortization) debt service is projected
to cover required debt service by only about 1.1 times.  This may
be mitigated to some extent by prudent reserving for capital
expenditures and/or managment of the timing of capital
expenditures.

Coleto Creek WLE LP is a 632 MW coal fired electric generating
facility located in Goliad County, Texas.  Coleto is owned 100% by
Topaz Power Partners, LLC, which is owned 50/50 by Sempra Energy
Partners, LLC, an indirect subsidiary of Sempra Energy, Inc. and
by two funds that are managed by Carlyle/Riverstone.


COMPRESSION POLYMERS: Moody's Rates $215M Sr. Unsec. Notes at B2
----------------------------------------------------------------
Moody's Investors Service has assigned these ratings to
Compression Polymers Holding Corporation, a manufacturer of
engineered extruded plastic sheet products.  The rating outlook is
stable.  The ratings are subject to review of the final
documentation of the financing transactions.

New Ratings Assigned:

   * B2 for the proposed $65 million senior unsecured floating
     rate notes, due 2012,

   * B2 for the proposed $150 million senior unsecured fixed rate
     notes, due 2013, and

   * B2 senior implied rating.

Moody's does not rate the company's $40 million senior secured
revolving credit facility, due 2011.

Proceeds from the notes issuance will be used to fund the purchase
of Compression by affiliates of AEA Investors LLC, a private
equity group, for $355 million.  Equity investment will be
$165 million.

The ratings reflect Compression's:

   (1) significant starting debt leverage,
   (2) modest cash flow generation,
   (3) considerable customer concentration,
   (4) exposure to resin prices, and
   (5) relatively small size.

At the same time, the ratings recognize the strong growth in the
company's sythetic pvc trim product line in recent years and the
highly favorable industry dynamics that may support its continued
growth.  The ratings are further supported by the company's:

   (1) strong brand recognition,

   (2) proprietary manufacturing know-how,

   (3) strong market position in its core product lines, and

   (4) established distribution channel that should help defend
       its market shares.

The stable rating outlook reflects Moody's expectations of
continued strong performance over the next 12-18 months that
should help alleviate concerns over the company's high starting
debt leverage.  Over the medium term, positive rating momentum
could develop if strong performance sustains, resin price concern
recedes, and free cash flow generation improves.  However, capital
withdrawal by equity investors would have negative implications on
the ratings.

Compression is a leading manufacturer of engineered extruded
plastic sheet products used primarily as replacements for wood and
metal.  The company has three primary product lines:

     (i) AZEK, a decorative, synthetic trim used as a substitute
         for wood and other alternative materials in housing trim
         and millwork;

    (ii) Comtec, a line of fabricated plastic bathroom partitions
         and lockers for institutional facilities; and

   (iii) other thick-gauged plastic sheet products manufactured by
         Vycom and Compression Polymers.

AZEK is Compression's largest and fastest growing product.  AZEK
sales have experienced tremendous growth in recent years, with
sales increasing at a compounded annual growth rate of 81% since
2001.  The exterior trim market is currently a $2.5 billion market
with the predominant market share being wood trim.  AZEK is very
early in the penetration of this market.  Management estimates
that the company controls a significant percentage of the market
for cellular pvc trim.  The company has so far concentrated its
marketing of the AZEK products in the eastern half of the US and
is now starting to ramp up its marketing efforts into the western
markets.  Given limited penetration and favorable end-user
acceptance of cellular pvc trim board products, AZEK appears to be
poised for continued strong growth for at least the next few
years.

AZEK sells its products mainly to specialty distributors who in
turn sell to individual lumber yards.  AZEK's top 10 distributor
networks account for over 97% of the segment's 2004 revenues, with
its largest distributor network accounting for nearly half of the
segment's revenues or 21% of the company's overall revenues.  This
high customer concentration leaves the company vulnerable to both
the credit risks of its largest customers and the potential loss
of their future business, although strong end-user demand means
that distributors can be relatively easy to replace.

Comtec, the company's second largest product, is for plastic
bathroom partitions and lockers for use in schools, fitness
centers and other institutional facilities.  Comtec claims the No.
1 market position in the plastic bathroom partition market.
However, the bathroom partition market is mature and plastic
products face strong competition from alternate materials such as
metal.

The company's other sheet products manufactured by Vycom and
Compression Polymers extrude plastic sheets that are used in a
wide variety of products and applications. The products are
commodity oriented and sales are driven by the state of the
general economy.  In 2004, the cyclical upswing in the US
industrial market, coupled with a joint selling and marketing
effort of both segments, contributed to above average growth in
revenue.  Margins for these products are lower than AZEK or
Comtec, but they strategically serve as a breeding ground for new
products.

Pro forma for the transaction, the company will have starting debt
of approximately $216.7 million, or 5.3 times LTM EBITDA.  LTM
EBITDA would cover pro forma interest expense approximately
1.7 times.  The company's cash flow generation is expected to be
modest for the next couple of years given high interest expense
and relatively high capital spending (mostly growth capex to
support increasing demand).  As such, de-leveraging is likely to
be achieved primarily through EBITDA expansion rather than debt
repayment.  Liquidity is to be provided by the $40 million
revolver which will be undrawn at closing.

The floating rate notes and fixed rate notes will rank pari passu
with each other.  The B2 rating reflects the notes' effective
subordination to secured senior debt under the revolving credit
facility.  Both notes are unsecured but enjoy guarantees from all
material future and existing domestic subsidiaries as well as its
parent company.

Headquartered in Moosic, Pennsylvania, Compression Polymers
Holding Corporation is a manufacturer of engineered extruded
plastic sheet products.  The company reported total revenues of
$187 million for the LTM period ended February 28, 2005.


CONXUS COMMUNICATIONS: Chapter 7 Case is Coming to an End
---------------------------------------------------------
James E. O'Neill, the Chapter 7 Trustee overseeing the liquidation
of Conxus Communications, Inc., and its debtor-affiliates' estates
reports that, to date, he's recovered $3,292,101.04 and
distributed $2,541,434,09 pursuant to Court Orders.  He has
$750,666.95 on hand.

The Trustee prosecuted Preference Actions against:

     * Visual Marketing, Inc.
     * Andrew Corporation
     * Worldcom Technologies
     * Worksmart, Inc.
     * Young Supply Company
     * Hutton Communications
     * KWGC, Inc. Advertising & Design
     * Lucent Technologies
     * McCollisters Transportation Systems, Inc.
     * Provence Printing, Inc.
     * The Radio Exchange Corp.
     * Staples, Inc.
     * Moss & Associates
     * Chancellor Media Corp. a/k/a K-Big 104, et al.
     * Deloitte & Touche LLP And
     * Edwards And Kelcey Wireless, L.L.C.

and believes all of these are resolved.  The Trustee is waiting
for entry of a default judgment against Hutton Communications and
waiting for resolution of his claim against WorldCom in that
company's chapter 11 proceeding.

The Trustee expects he'll need additional time to review and
interpose objections, as necessary under 11 U.S.C. Sec. 704(5) to
certain Requests for Allowance and Proofs of Claims asserting
entitlement to priority as administrative claims.  In addition,
final fee applications by the professionals and final tax returns
need to be prepared and filed to enable the submission of the
Trustee's Final Report to the Office of the United States Trustee.
The Trustee says he'll file all necessary claims objections within
the next 30 days and he expects to file his Final Report with the
Office of the United States Trustee after that.

Unable to pay $135 million raised in debt issues, Conxus
Communications, Inc., and its debtor-affiliates filed for chapter
11 protection on May 18, 1999 (Bankr. D. Del. Case No. 99-01147).
The Company sold voice mail pagers and its Pocketalk service in
Dallas and Fort Worth, San Francisco, Los Angeles, Philadelphia,
Boston, New York, Washington, Atlanta, Houston, Chicago and some
areas in southern Florida.  The Company planned to reorganize and
continue to operate as debtor in possession, arranging financing
for continuing operation.  The FCC, which issued licenses in both
PCS and specialized mobile radio spectrum, and Arch
Communications, Glenayre, Metrocall and Motorola, which provided
Pocketalk customer units, were Conxus' key creditors.  Three
months into the chapter 11 process, it became obvious a
reorganization was impossible, and Conxus' Chapter 11 cases were
subsequently converted to Chapter 7 liquidation proceedings.  Mr.
O'Neill is represented by John T. Carroll, III, Esq., at Cozen
O'Connor in Wilmington.


CORNING INC.: S&P Lifts Ratings on Three Transactions to BBB-
-------------------------------------------------------------
Standard & Poor's Ratings Services raised its ratings on three
synthetic transactions related to Corning Inc. and removed them
from CreditWatch positive, where they were placed Feb. 16, 2005.

The rating actions reflect the April 27, 2005, raising of the
rating on Corning Inc.'s senior unsecured debt and its subsequent
removal from CreditWatch.

The three deals are swap-independent synthetic transactions that
are weak-linked to the underlying collateral, Corning Inc.'s
senior unsecured debt.  The rating actions reflect the credit
quality of the underlying securities issued by Corning Inc.

A copy of the Corning Inc.-related research update, dated
April 27, 2005, can be found on RatingsDirect, Standard & Poor's
Web-based credit analysis system at http://www.ratingsdirect.com/

      Ratings Raised And Removed From Creditwatch Positive

            Corporate Backed Trust Certificates Corning
               Debenture-Backed Series 2001-28 Trust
        $15 million Corning debenture-backed series 2001-28

                                   Rating
                                   ------
                     Class     To            From
                     -----     --            ----
                     A-1       BBB-          BB+/Watch Pos
                     A-2       BBB-          BB+/Watch Pos

            Corporate Backed Trust Certificates Corning
               Debenture-Backed Series 2001-35 Trust
        $29 million Corning debenture-backed series 2001-35

                                   Rating
                                   ------
                     Class     To            From
                     -----     --            ----
                     A-1       BBB-          BB+/Watch Pos
                     A-2       BBB-          BB+/Watch Pos

                  CorTS Trust For Corning Notes
          $39 million corporate-backed trust securities

                                   Rating
                                   ------
                     Class     To            From
                     -----     --            ----
                     A         BBB-          BB+/Watch Pos


CREDIT SUISSE: S&P Puts Low-B Ratings on $38 Million Class Certs.
-----------------------------------------------------------------
Standard & Poor's Ratings Services assigned its preliminary
ratings to Credit Suisse First Boston Mortgage Securities Corp.'s
$1.616 billion commercial mortgage pass-through certificates
series 2005-C2.

The preliminary ratings are based on information as of May 11,
2005.  Subsequent information may result in the assignment of
final ratings that differ from the preliminary ratings.

The preliminary ratings reflect the credit support provided by the
subordinate classes of certificates, the liquidity provided by the
trustee, the economics of the underlying loans, and the geographic
and property type diversity of the loans.  Class A-1, A-2, A-3, A-
AB, A-4, A-1-A, A-MFL, A-MFX, A-J, B, C, and D are currently being
offered publicly.

Standard & Poor's determined that, on a weighted average basis,
the pool has a debt service coverage of 1.31x, a beginning LTV of
100.1%, and an ending LTV of 88.0%.

A copy of Standard & Poor's complete presale report for this
transaction can be found on RatingsDirect, Standard & Poor's Web-
based credit analysis system at http://www.ratingsdirect.com/

The presale can also be found on the Standard & Poor's Web site at
http://www.standardandpoors.com/

                   Preliminary Ratings Assigned
          Credit Suisse First Boston Mortgage Securities Corp.

        Class                       Rating   Preliminary amount
        -----                       ------   ------------------
        A-1, A-2, A-3, A-AB,
        A-4, and A-1-A              AAA          $1,131,259,000
        A-MFL and A-MFX             AAA            $161,608,000
        A-J                         AAA            $111,106,000
        B                           AA              $30,301,000
        C                           AA-             $16,161,000
        D                           A               $28,282,000
        E                           A-              $18,181,000
        F                           BBB+            $20,201,000
        G                           BBB             $16,161,000
        H                           BBB-            $20,201,000
        J                           BB+              $8,080,000
        K                           BB               $8,081,000
        L                           BB-              $8,080,000
        M                           B+               $2,020,000
        N                           B                $6,060,000
        O                           B-               $6,061,000
        P                           N.R.            $24,241,459
        A-X*                        AAA          $1,616,084,459
        A-SP*                       AAA                     TBD
        TM                          N.R.             $9,000,000

             * Interest-only class with a notional dollar amount.
             N.R. -- Not rated.
             TBD  -- To be determined.


DELPHI CORP.: Hires Rothschild as Financial Advisor
---------------------------------------------------
Citing unnamed people familiar with the situation as their source,
Joseph B. White and Joann S. Lublin at The Wall Street Journal
report that Delphi Corp., has hired Rothschild Inc. as its
financial advisor.  Neither Rothschild nor Delphia would confirm
the report when asked by Journal, Reuters and Bloomberg reporters.

                           Downgrades

On April 21, 2005, Standard & Poor's Rating Services lowered its
corporate credit and senior unsecured ratings on Delphi
Corporation to 'BB' from 'BB+' and its preferred stock rating
(trust preferred rating) to 'B' from 'B+'.  The ratings remain on
CreditWatch with negative implications.

Also on April 21, 2005, Fitch Ratings lowered its senior unsecured
debt and bank facilities ratings on Delphi to 'BB-' from 'BB+',
its trust preferred rating to 'B' from 'BB-', and its commercial
paper rating is being withdrawn from a previous rating of 'B'.
The ratings remain on Rating Watch Negative by Fitch.

                        364-Day Revolver

Delphi has a $1,500,00,000 364-Day Sixth Amended and Restated
Competitive Advance and Revolving Credit Facility, dated as of
June 18, 2004 (as amended, supplemented, or otherwise modified
from time to time), maturing next month.

John D. Sheehan, Delphi's Acting Chief Financial Officer, Chief
Accounting Officer and Controller says there are no outstanding
amounts under the 364-Day Facility and Delphi has never borrowed
under that facility or another $1,500,000,000 five-year revolving
credit line maturing in June 2009.

The Lending Consortia behind those credit agreements are led by
CITIBANK, N.A., as syndication agent, BARCLAYS BANK PLC, DEUTSCHE
BANK SECURITIES INC. and HSBC BANK USA, as documentation agents,
and JPMORGAN CHASE BANK, N.A. (formerly known as JPMORGAN CHASE
BANK), as administrative agent.  Lawyers at Simpson Thacher &
Bartlett LLP represent the Lenders.

Delphi Corp. -- http://www.delphi.com/-- is the world's largest
automotive component supplier with annual revenues topping
$25 billion.  Delphi is a world leader in mobile electronics and
transportation components and systems technology.   Multi-national
Delphi conducts its business operations through various
subsidiaries and has headquarters in Troy, Michigan, USA, Paris,
Tokyo and Sao Paulo, Brazil. Delphi's two business sectors --
Dynamics, Propulsion, Thermal & Interior Sector and Electrical,
Electronics & Safety Sector -- provide comprehensive product
solutions to complex customer needs.  Delphi has approximately
186,500 employees and operates 171 wholly owned manufacturing
sites, 42 joint ventures, 53 customer centers and sales offices
and 34 technical centers in 41 countries.


DESA HOLDINGS: Has Until May 23 to Remove State Court Actions
-------------------------------------------------------------
The U.S. Bankruptcy Court for the District of Delaware gave DESA
Holdings Corporation and its debtor-affiliate, DESA International,
Inc., more time, through and including, May 23, 2005, to file
notices of removal with respect to Pre-Petition Civil Actions
pursuant to 28 U.S.C. Section 1452 and Rules 9027 of the Federal
Rules of Bankruptcy Procedure.

The Court confirmed the Debtors' Second Amended Joint Plan of
Liquidation on April 1, 2005, and the Plan took effect on the
same day.

The Debtors gave the Court three reasons in support of the
extension:

   a) the extension will give the Debtors more opportunity to
      review all the remaining Pre-Petition Civil Actions that
      have not been resolved in order to make fully-informed
      decisions for those Civil Actions;

   b) the extension will assure that the Debtors do not forfeit
      their valuable rights under 28 U.S.C. Section 1452; and

   c) the Debtors assure the Court that the extension will not
      prejudice their adversaries as they will still retain the
      right to have their actions remanded to the state courts
      pursuant to 28 U.S.C. Section 1452(b).

Headquartered in Bowling Green, Kentucky, DESA International,
Inc., manufactured and marketed high-quality zone heating
products, hearth products, security lighting and specialty tools
for use in homes and commercial buildings.  The Company and its
affiliate filed for chapter 11 protection (Bankr. Del. Case No.
02-11672) on June 8, 2002.  James H.M. Sprayregen, Esq., James W.
Kapp, III, Esq., and Scott R. Zemnick, Esq., at Kirkland & Ellis,
LLP, and Laura Davis Jones, Esq., at Pachulski, Stang, Ziehl Young
Jones & Weintraub, P.C., represent the Debtors.  When the Debtors
filed for protection from their creditors, they estimated assets
of up to $50 million and debts of up to $100 million in debts.  On
April 1, 2005, the Debtors' Second Amended Joint Plan of
Liquidation was confirmed and took effect on the same day.


DJT LLC: Involuntary Chapter 11 Case Summary
--------------------------------------------
Alleged Debtors: DJT, LLC
                 15401 Northeast 279th Street
                 Battle Ground, Washington 98604

Involuntary Petition Date: May 11, 2005

Case Number: 05-44351

Chapter: 11

Court: Western District of Washington (Tacoma)

Judge: Paul B. Snyder

Petitioners' Counsel: Timothy J. Dack, Esq.
                      1112 Daniels Street, Suite 100
                      P.O. Box 61645
                      Vancouver, Washington 98666-1645
                      Tel: (360) 694-4227

Petitioners                          Amount of Claim
-----------                          ---------------
Paul E. Christensen                       $2,267,423
1111 Main Street, Suite 700
Vancouver, WA 98660

Grant Wishart                                $93,762
2685 Northeast Cleveland Avenue
Gresham, OR 97030

Staybridge Suites                             $1,433
11936 Northeast Glenn Widing Road
Portland, OR 97220


DMX MUSIC: Wants to Hire Downer & Company as Investment Bankers
---------------------------------------------------------------
DMX MUSIC, Inc., and its debtor affiliates ask the U.S.
Bankruptcy Court for the District of Delaware for permission to
employ Downer & Company S.A.S. as their investment bankers and
restructuring advisors

Downer & Company is expected to:

   a) advise the Debtors with regards to a strategy to a proposed
      Sales Transaction for their assets, especially with the
      Debtors' Foreign Subsidiaries, and assist in the preparation
      of a descriptive memorandum and presentation of the Foreign
      Subsidiaries' activities;

   b) assist in conducting the search and screening for
      prospective buyers or business partners having
      characteristics suitable to the Debtors' objectives in the
      Sales Transaction, especially with respect to the Foreign
      Subsidiaries;

   c) advise with respect to the negotiation process for the Sales
      Transaction by evaluating alternative negotiation
      strategies, possible offers and counter offers and assist in
      structuring the most appropriate plan for the Transaction;

   d) advise the Debtors' management in preparing programs and
      presentations that may be required by the Debtors' creditors
      and other stakeholders, and in coordinating communications
      with the parties in interest and their respective advisors;
      and

   e) advise the Debtors on screening and evaluating the
      prospective buyers interested in an acquisition, merger,
      joint venture, license agreements or financing transaction
      limited to any or all of the Debtor's Foreign Subsidiaries.

Thomas C. Munnell, a Member at Downer & Company, reports that the
Firm will be paid with:

   a) a Start-Up Fee of EUR75,000; and

   b) a Transaction Fee equal to 8% of a portion of the
      Transaction Value equal to or less than the product of seven
      multiplied by the trailing 12 months EBITDA generated by the
      operations which are the subject of the Sales Transaction,
      plus 5% of the difference between the aggregate
      consideration for the transactions less the EBITDA Price
      Component.

Downer & Company assures the Court that it does not represent any
interest materially adverse to the Debtors or their estates.

Headquartered in Los Angeles, California, DMX MUSIC, Inc., --
http://www.dmxmusic.com/-- is majority-owned by Liberty Digital,
a subsidiary of Liberty Media Corporation, with operations in more
than 100 countries.  DMX MUSIC distributes its music and visual
services worldwide to more than 11 million homes, 180,000
businesses, and 30 airlines with a worldwide daily listening
audience of more than 100 million people.  The Company and its
debtor-affiliates filed for chapter 11 protection on Feb. 14, 2005
(Bankr. D. Del. Case No. 05-10431).  The case is jointly
administered under Maxide Acquisition, Inc. (Bankr. D. Del. Case
No. 05-10429).  Curtis A. Hehn, Esq., and Laura Davis Jones, Esq.,
at Pachulski, Stang, Ziehl, Young, Jones & Weintraub P.C.,
represent the Debtors in their restructuring efforts.  When the
Debtors filed for protection from their creditors, they estimated
more than $100 million in assets and debts.


DMX MUSIC: Has Until June 14 to Make Lease-Related Decisions
------------------------------------------------------------
The U.S. Bankruptcy Court for the District of Delaware extended,
until June 14, 2005, the period within which DMX MUSIC, Inc., and
its debtor affiliates, can elect to assume, assume and assign, or
reject their unexpired nonresidential real property leases.

The Debtors tell the Court that they are parties to 19 unexpired
nonresidential real property leases located in several states.

The Debtors explain they are still awaiting the Court's decision
on their request to sell substantially all of their assets, which
included a majority of their unexpired nonresidential real
property leases.

Consequently, given the length of time necessary to close on the
sale, contacting and negotiating with the landlords of those
leases and evaluating the appropriate course of conduct with
respect to each of the unexpired nonresidential leases, the
extension is therefore warranted.

Headquartered in Los Angeles, California, DMX MUSIC, Inc., --
http://www.dmxmusic.com/-- is majority-owned by Liberty Digital,
a subsidiary of Liberty Media Corporation, with operations in more
than 100 countries.  DMX MUSIC distributes its music and visual
services worldwide to more than 11 million homes, 180,000
businesses, and 30 airlines with a worldwide daily listening
audience of more than 100 million people.  The Company and its
debtor-affiliates filed for chapter 11 protection on Feb. 14, 2005
(Bankr. D. Del. Case No. 05-10431).  The case is jointly
administered under Maxide Acquisition, Inc. (Bankr. D. Del. Case
No. 05-10429).  Curtis A. Hehn, Esq., and Laura Davis Jones, Esq.,
at Pachulski, Stang, Ziehl, Young, Jones & Weintraub P.C.,
represent the Debtors in their restructuring efforts.  When the
Debtors filed for protection from their creditors, they estimated
more than $100 million in assets and debts.


DOANE PET: Earns $7.2 Million of Net Income for First Quarter
-------------------------------------------------------------
Doane Pet Care Company reported sales and earnings results for its
fiscal 2005 first quarter.

                       Quarterly Results

For the first quarter of fiscal 2005, the Company's net sales were
$267.1 million compared to $270.9 million for the first quarter of
fiscal 2004, a decrease of 1.4%.  Excluding the benefit of the
favorable foreign currency exchange rate, net sales decreased
2.6%.  This decrease was primarily due to our cost-sharing
arrangements and the related impact of passing through lower
commodity costs.

The Company reported net income of $7.2 million for its 2005 first
quarter compared to a net loss of $7.8 million for the 2004 first
quarter.  Income from operations increased to $26.9 million in
2005 from $11.0 million in 2004.  The substantial improvement in
income from operations was primarily due to lower global commodity
costs.  In addition, the period-over-period change in the
Company's income from operations was impacted by a $4.1 million
favorable change in the required mark-to-market fair value
accounting of the Company's commodity derivative instruments and
$3.5 million of other operating income primarily related to
favorable litigation settlements.

Net cash provided by operating activities was $4.6 million for the
2005 first quarter compared to cash used by operating activities
of $2.1 million for the 2004 first quarter.  The improvement was
principally due to higher earnings partially offset by the timing
of payments of certain accrued expenses.

Adjusted EBITDA increased 30.3% in the current quarter to $31.1
million, or up $7.3 million from $23.8 million for the first
quarter of 2004.  The significant increase was largely due to
lower global commodity costs.

Doug Cahill, the Company's President and CEO, said, "This was a
great quarter for our company.  While our dry raw material costs
have declined to a more normalized level, we continue to combat
the same cost pressures that our customers are combating such as
fuel, packaging, natural gas and medical costs.  Fortunately, our
global team did a terrific job in moderating the impact of these
cost pressures with excellent performance in safety, service and
productivity this past quarter.  We remain optimistic about our
prospects for the balance of 2005 despite some upward movement in
dry raw material costs in recent weeks."

                      About the Company

Doane Pet Care Company -- http://www.doanepetcare.com/-- based in
Brentwood, Tennessee, is the largest manufacturer of private label
pet food and the second largest manufacturer of dry pet food
overall in the United States. The Company sells to approximately
550 customers around the world and serves many of the top pet food
retailers in the United States, Europe and Japan.  The Company
offers its customers a full range of pet food products for both
dogs and cats, including dry, semi-moist, soft-dry, wet, treats
and dog biscuits.

                         *     *     *

Standard & Poor's assigned junk ratings to Doane Pet Care
Company's 10-3/4% senior subordinated notes due March 1, 2010.


DOMTAR INC: Weak Cash Flow Prompts S&P to Cut Ratings to BB+
------------------------------------------------------------
Standard & Poor's Ratings Services lowered its long-term corporate
credit and senior unsecured debt ratings on paper producer Domtar
Inc. to 'BB+' from 'BBB-'.  At the same time, Standard & Poor's
revised its outlook on Domtar to stable.

The ratings on Montreal, Quebec-based Domtar reflect:

    (1) the company's exposure to cyclical paper prices,

    (2) aggressive debt leverage, and

    (3) a declining cost position due to a stronger Canadian
        dollar.

These risks are partially offset by good fiber and energy
integration, and some revenue diversity.

"Despite the cyclical upswing in uncoated freesheet paper prices,
Domtar's credit metrics are not recovering as much as we had
originally expected," said Standard & Poor's credit analyst Daniel
Parker.  "We are not convinced Domtar can restore, and also
maintain, an investment-grade quality financial profile, given the
relatively weak cash flow generation at this point in the cycle,"
Mr. Parker added.  Domtar's earnings have been materially affected
by the appreciation of the Canadian dollar, and other cost
pressures such as fiber, freight, and energy. Softwood lumber
duties have been an additional burden.

With 50% of its production located in Canada and 75% of its sales
to the U.S., Domtar's cost position is materially affected by the
foreign exchange rate of the Canadian dollar.  The relatively high
Canadian dollar (currently about 81 U.S. cents) represents about a
15% increase on the Canadian export margins; the Canadian dollar
averaged 70 U.S. cents to 2005 from 2000.  Domtar recently
announced the temporary closure of 150,000 tonnes of pulp and
85,000 tonnes of paper capacity in Canada, and will eliminate
about 790 jobs.  These initiatives are intended to improve
profitability by about C$100 million in 2005.

The outlook is currently stable.  Standard & Poor's expects the
company's financial performance to improve in 2005 as prices are
expected to stay relatively strong.  The company's efforts to
restructure and reduce costs should also provide benefits to
earnings.  Nevertheless, we do not expect the company to be able
to materially reduce debt with internally generated cash flow.
The current ratings can tolerate several quarters of weak earnings
and cash flow generation.  Any further deterioration in operating
margins, or negative free cash generation would pressure the
ratings, or outlook however.


DONNKENNY INC: Court Okays Rejection of 19 Contracts & Leases
-------------------------------------------------------------
Donnkenny, Inc., and its debtor-affiliates sought and obtained
authority from the U.S. Bankruptcy Court for the Southern District
of New York to reject certain executory contracts and unexpired
leases effective as of March 31, 2005.

Pursuant to the proposed chapter 11 plan, all unexpired leases and
executory contracts not expressly assumed are rejected.  A plan is
not expected to be confirmed in the Debtors' cases until after a
sale is consummated with Donn K Acquisition LLC.  The Debtors want
to reject any and all remaining executory contracts and unexpired
leases not expressly assumed by the Debtors or Donn K Acquisition.

The Debtors have determined that the goods and services provided
by 19 contracts and leases are no longer needed by the Debtors or
their estates and that no purchaser of the Debtors' assets is
interested in taking an assignment of any of the contracts or
leases.  Any administrative expense for maintaining the contracts
and leases is, therefore, a burden to the Debtors' estates.  The
Bankruptcy Court approved the rejection of these contracts and
leases as of March 31, 2005.

A list of the 19 rejected executory contracts and unexpired leases
Donnkenny is walking away from is available for a fee at:

  http://www.researcharchives.com/bin/download?id=050512210416

A list of the contracts and leases Donnkenny will assume is
available for a fee at:

  http://www.researcharchives.com/bin/download?id=050512210703

Headquartered in New York City, Donnkenny, Inc., and its debtor-
affiliates design, import, and market broad lines of moderately
and better priced women's clothing.  The Debtors filed for chapter
11 protection on Feb. 7, 2005 (Bankr. S.D.N.Y. Case No. 05-10712
through 05-10716).  Bonnie Steingart, Esq., Kalman Ochs, Esq., and
Christopher R. Bryant, Esq., at Fried, Frank, Harris, Shriver &
Jacobson LLP, represent the Debtors in their restructuring
efforts.  When the Debtors filed for protection from their
creditors, they listed $45,670,000 in total assets and
$100,100,000 in total debts.


EL PASO: Earns $106 Million of Net Income in First Quarter 2005
---------------------------------------------------------------
El Paso Corporation (NYSE: EP) is providing their first quarter
2005 financial and operational results for the company.  "We
continue to make progress on all fronts," said Doug Foshee,
president and chief executive officer of El Paso.  "Our pipelines
delivered solid financial results and growth prospects look good.
Our production business is making the progress necessary to
complete its turnaround this year, and it is ahead of pace to
replace production in 2005.  Finally, in March we delivered an
update to our long-range plan that accelerates our debt-reduction
plans as well as our plan to be a company focused on two primary
businesses: natural gas pipelines and production."

                  Review of Financial Results

For the three months ended March 31, 2005, El Paso reported net
income of $106 million, compared with a net loss of $206 million
for the same period in 2004.  Significant items, which primarily
relate to a gain on the sale of the company's remaining general
partner interests and common units in Enterprise Products Partners
(Enterprise), offset by impairments on certain power assets and by
adjustments for the early payoff of the western energy settlement,
increased first quarter 2005 EBIT by $31 million.  Impairments on
asset sales and restructuring costs decreased first quarter 2004
EBIT by $269 million.

First quarter 2005 results also were negatively impacted by a non-
cash $106-million mark-to-market loss on the $6.00 per MMBtu
floors that El Paso purchased and the $9.50 per MMBtu ceilings
that El Paso sold to manage price risk for its 2005-2007 natural
gas production volumes.  The company will continue to highlight
the earnings impact of these positions, which had a remaining
mark-to-market value of $11 million at March 31, 2005.

Cash flow from operations for the first quarter of 2005 was lower
than a year ago primarily due to higher cash flow from
discontinued operations in 2004 and differences in working capital
between the two periods.  In the first quarter of 2005, the
company made a $240-million payment to eliminate El Paso
Marketing's power supply obligations associated with the sale of
Cedar Brakes I and II, which is reflected as a use of operating
cash.  The company's liquidity position remains strong at
approximately $1.8 billion, compared with $1.3 billion in
maturities over the next 12 months.

The pipeline segment reported a $26-million increase in EBIT in
the first quarter of 2005 compared with the same period last year
primarily due to the positive impact of a contract restructuring
on ANR Pipeline and the sale of higher volumes of natural gas made
available by storage realignment projects partially offset by
higher costs.

The pipeline segment generally performed consistently with the
company's expectations for the first quarter of 2005, and El Paso
currently anticipates that the pipeline segment will continue to
meet its expectations for the remainder of 2005.

The production segment reported lower EBIT in the first quarter of
2005 than in the same period last year, primarily due to lower
production volumes and higher costs, partially offset by higher
realized commodity prices.  The production segment's unit of
production depletion rate was higher than the 2004 level due to
higher finding and development costs.  Per-unit cash costs also
rose from a year ago due to lower volumes, higher production-
related taxes, and an increase in workover activities, which are
expensed in the current period.  Capital expenditures were higher
for the first quarter of 2005 compared with a year ago due to
acquisition activity.

The production segment generally performed consistently with the
company's expectations for the first quarter of 2005.  Lower-than-
expected production volumes and higher costs were more than offset
by higher-than-expected commodity prices.  Production volumes rose
during the course of the first quarter of 2005 and currently
exceed 800 MMcfe/d.  El Paso currently anticipates that the
production segment will meet its expectations for the remainder of
2005.

The marketing and trading segment reported lower EBIT in the first
quarter of 2005 than in the same period last year, due in part to
the previously mentioned $106-million non-cash loss on the mark-
to-market value of the put and call option contracts entered into
as an economic hedge on the company's production for 2005-2007.
In addition, the segment reported an $83-million loss in the value
of its power-related contracts.

The marketing and trading segment's performance did not meet the
company's expectations for the first quarter of 2005, primarily
due to the non-cash mark-to-market loss on the production option
contracts previously discussed and El Paso's power portfolio
(including the Cordova tolling agreement), which was impacted by
natural gas and power price increases during the quarter.  The
company currently anticipates that results from this segment will
continue to be volatile as the marketing and trading segment
continues to transition toward a core marketing business.

The power segment reported a smaller loss in EBIT in the first
quarter of 2005 than in the same period last year due to smaller
impairment charges.  Operating results for the first quarter of
2005 were lower than 2004 due to the impact of domestic asset
sales over the last year.  The international businesses performed
in line with expectations; however, the decision to not recognize
earnings from certain of El Paso's Asian power assets in 2005
based on the planned sale and the decision to not recognize
revenues from the Macae plant in Brazil in 2005 pending resolution
of the company's ongoing dispute with Petrobras resulted in
earnings from the power segment which were below the company's
expectations.

The field services segment reported higher EBIT in the first
quarter of 2005 than in the same period last year.  The
improvement is primarily due to the recognition of a gain of $183
million in the first quarter of 2005 related to the completion of
the sale of El Paso's remaining interests in Enterprise.  Results
from this segment were lower in 2005 excluding the benefit of this
sale due to the disposition of a significant portion of this
segment's assets in 2004 and early 2005.

The field services segment generally performed consistently with
the company's expectations for the first quarter of 2005, due to
successful execution of the sale of the remaining interests in
Enterprise and strong performance by the remaining assets due to
high commodity prices.  El Paso currently anticipates that
earnings from this segment will decline in the future as a result
of the company's ongoing asset sales efforts.

                    Corporate Operations

Corporate operations reported a $90-million EBIT loss for the
first quarter of 2005, which was $117 million below the same
period last year.  The EBIT decrease is primarily due to a $59-
million charge related to the western energy settlement, $29
million of losses on early extinguishment of Euro- denominated
debt, and other items including increased legal and insurance
reserves.

                           Tax Rate

The company reported a negative 3-percent tax rate in the period
due primarily to a reduction in its reserves for tax contingencies
as a result of an IRS settlement on the 1995 to 1997 Coastal
Corporation income tax returns, tax benefits recognized on the
sale of a foreign investment, and state tax adjustments to reflect
income tax returns as filed.  Partially offsetting these items was
an impairment of certain foreign investments for which there was
no corresponding tax benefit.  This resulted in an overall income
tax benefit for a period in which there was pre-tax income.  The
company expects to report an ongoing book tax rate of between 35
percent and 38 percent.

                        About the Company

El Paso Corporation -- http://www.elpaso.com/-- provides natural
gas and related energy products in a safe, efficient, and
dependable manner.  The company owns North America's largest
natural gas pipeline system and one of North America's largest
independent natural gas producers.

                         *     *     *

As reported in the Troubled Company Reporter on March 4, 2005,
Standard & Poor's Ratings Services assigned its 'B-' rating to El
Paso Corp.'s subsidiary Colorado Interstate Gas Co.'s planned
$200 million senior unsecured notes.

At the same time, Standard & Poor's affirmed its 'B-' corporate
credit ratings on El Paso and its subsidiaries and revised the
outlook on the companies to stable from negative.

The outlook revision reflects El Paso's progress on restructuring
its business and the company's improved liquidity ahead of large
debt maturities in the next three years.

"The stable outlook reflects the expectation that El Paso will
continue to address adequately the company's operational and
financial issues," said Standard & Poor's credit analyst Ben
Tsocanos.

"Although liquidity is not an immediate concern, El Paso will
struggle to produce enough cash flow to barely cover its debt
service as it tackles the challenges in its plan," said Mr.
Tsocanos.


EMMIS COMMS: Stock Repurchase Plan Cues Moody's to Review Ratings
-----------------------------------------------------------------
Moody's Investors Service placed the long-term ratings of Emmis
Communications Corporation and its wholly owned subsidiary, Emmis
Operating Company, on review for possible downgrade following the
company's recent announcement that it intends to commence a dutch
auction tender offer to repurchase up to 20 million shares or 39%
of the company's outstanding common stock (about $400 million in
aggregate).  In addition, Emmis intends to explore strategic
alternatives for the company's television assets (representing
about 40% of the company's cash flow at fiscal year-end 2005).

The review is prompted by the company's already high debt
capitalization and the likelihood that leverage will increase and
credit metrics will weaken significantly in the near-term as the
company uses debt to finance the share repurchase [Thus, it is
likely that leverage (measured as total debt plus preferred to
EBITDA) will increase in excess of 8 times at the holding company
level in the interim].

The review will focus on the ability of the company to execute on
a strategic alternative for its television assets in the
intermediate-term and the extent to which Emmis will use proceeds
from this potential divestiture to reduce debt instead of
returning cash to shareholders or seeking other strategic
alternatives.  Moody's will conclude the review when there is
greater visibility into the company's future capital structure.
In addition, Moody's lowered Emmis' speculative grade liquidity
rating to SGL-3 from SGL-2.

These ratings are under review for possible downgrade:

   -- Emmis Operating Company

      * Ba2 rating on its senior secured credit facilities, and

      * B2 rating on its $375 million of senior subordinated notes
        due 2012.

   -- Emmis Communications Corporation

      * B3 rating on the 12.5% senior discount notes due 2011,

      * Caa1 rating on the $143.8 million of 6.25% cumulative
        convertible preferred stock,

      * B3 senior unsecured issuer rating, and

      * Ba3 senior implied rating.

The SGL-3 rating indicates expectations of Emmis' adequate
liquidity profile as projected over the next twelve months;
however, the lowering of the company's speculative grade liquidity
rating to SGL-3 from SGL-2 primarily reflects Moody's increased
concerns regarding the company's limited availability to its
revolving credit facility (the company will utilize the revolving
credit facility to finance a portion of the common stock
repurchase) and the reduced amount of cushion and financial
flexibility available under its existing bank covenants pro forma
for the proposed share repurchase.

Emmis Communications Corporation is headquartered in Indianapolis,
Indiana and is a diversified media company comprised of radio and
television stations and magazine publishing assets.


EMMIS COMMS: $400 Million Share Buyback Cues S&P to Watch Ratings
-----------------------------------------------------------------
Standard & Poor's Ratings Services placed all ratings on Emmis
Communications Corp., including the 'B+' long-term corporate
credit rating, on CreditWatch with negative implications,
acknowledging concerns related to the company's plans to
repurchase shares and explore strategic alternatives for its TV
business.  The Indianapolis, Indiana-based radio and TV
broadcasting company had approximately $1.2 billion in debt
outstanding at Feb. 28, 2005.

The company plans to buy back its shares at a cost of up to $400
million, which, if entirely debt-financed, could increase the
company's debt to EBITDA ratio to more than 8x, from around 6x at
Feb. 28, 2005.  Additional uncertainty relates to the valuation
and use of proceeds of a potential sale of all or a portion of
Emmis' TV business, and the timing of convincing growth in general
radio ad demand.

"In resolving the CreditWatch listing, we will evaluate the impact
of Emmis' new financings and potential TV station sales on its
liquidity and leverage profile," said Standard & Poor's credit
analyst Alyse Michaelson Kelly.

Standard & Poor's will also assess the company's ability to
restore debt to EBITDA to a range appropriate for a 'B+' rating,
which could be accomplished by using the proceeds from TV station
sales to pay down debt.  Management's long-term commitment to
credit quality and its broader strategic mission amid radio
advertising's anemic growth and pressure on the company's stock
price will also be considered.  Standard & Poor's currently
believes that downgrade risk is limited to one notch.

Growth in radio advertising is expected to be in the very low
single digits in 2005.  Radio ad demand is under pressure from
alternative media, repetitive programming, and the excess clutter
that the industry is starting to address.  Emmis' domestic radio
revenue growth is being driven by ratings improvement and price
increases.  Still, only a few large radio markets, including New
York and Los Angeles, provide a sizable portion of the radio
unit's broadcast cash flow.


EPOCH INVESTMENTS: Involuntary Chapter 11 Case Summary
------------------------------------------------------
Alleged Debtor: Epoch Investments, L.P.
                fka Empyrean Investments, L.P.
                15 East 69th Street
                Apartment 7C
                New York, New York 1002

Involuntary Petition Date: May 12, 2005

Case Number: 05-13470

Chapter: 11

Court: Southern District of New York (Manhattan)

Judge: Allan L. Gropper

Debtor's Counsel: Gabriel Del Virginia, Esq.
                  Law Offices of Gabriel Del Virginia
                  641 Lexington Avenue, 18th Floor
                  New York, New York 10022
                  Tel: (212) 371-5478
                  Fax: (212) 371-2961

Petitioner:       Alan Nisselson, Esq.
                  Chapter 11 Trustee of MarketXT Holdings Corp.
                  Brauner Baron Rosenzweig & Klein, LLP
                  61 Broadway, 18th Floor
                  New York, New York 10006

Petitioner's
Counsel:          Leslie S. Barr, Esq.
                  Brauner Baron Rosenzweig & Klein, LLP
                  61 Broadway, 18th Floor
                  New York, New York 10006-2794
                  Tel: (212) 797-9100
                  Fax: (212) 797-9161

Nature of Claim:  Transfer of money for less than equivalent
                  consideration.

Amount of Claim:  $2.5 Million


EQUITY INNS: Moody's Assigns Ba3 Issuer Rating on Partnership
-------------------------------------------------------------
Moody's Investors Service upgraded its ratings of the preferred
stock of Equity Inns, Inc. to B2, from B3, and assigned a first
time Issuer rating of Ba3 to Equity Inns Partnership, L.P., the
97%-owned operating partnership through which the REIT conducts
substantially all of its business and holds all of its hotel
assets.  The rating outlook is stable.

According to Moody's, the upgrade reflects:

   (1) Equity Inns' increasingly sound position in the less
       volatile limited service hotel sector,

   (2) its steady growth in size and diversity, and its ability to
       weather the recent downturn in the lodging sector without
       substantial distress.

Equity Inns was one of the few lodging REITs, which did not
suspend its dividend for any sustainable period in the wake of
September 11, 2001.

Moody's said that between 2000 and 2004, Equity Inns maintained
its effective leverage between 45% and 50%, and lowered its
leverage (Net Debt / EBITDA) from approximately 5X to nearer 4X as
a result of improvements in hospitality fundamentals.  These
metrics place ENN in the middle among its rated peers.  Over the
same period, Equity Inns' fixed charge fluctuated around 2.0X,
which was the approximate level at December 31, 2004.  In
comparison to its lodging peers, ENN's fixed charge is close to
the mean.

The key challenge in Equity Inns' credit profile is secured debt:
at 42% of assets, it is more than twice the average of rated
lodging REITs at 19%.  Equity Inns has the highest proportion of
secured leverage among the seven lodging REITs rated by Moody's.
While this is a material credit negative, it is mitigated by good
asset quality, consistent operating performance, material growth,
and the REIT's determination explore more conservative financial
structures.

The stable rating outlook reflects Moody's expectation that Equity
Inns will prudently grow its limited service base while
diversifying by geography, brand, flag and hotel managers.
Moody's also anticipates that the REIT will maintain or improve
current leverage and coverage ratios while exploring prudent and
flexible means for furthering growth.

Further upgrades for Equity Inns would require a reduction in
secured debt closer to 38% of gross assets (possibly including the
unsecuring of its revolving credit facility) and growing the
unencumbered asset pool closer to 25%.  Moody's would also view
favorably a diminished reliance on the Hampton Inn brand closer to
30% of revenue, as well as reduced exposure to the South Atlantic
region closer to 20% of revenue.

Moody's would take negative rating action should there occur a
deterioration in effective leverage above 60% of gross assets,
fixed charge below 1.8X, or secured debt above 45% of gross
assets.  Other issues, which would create negative rating pressure
include a lack of progress in growing the unencumbered asset pool
or a significant downturn in the lodging industry.

These rating actions have been taken:

   -- Equity Inns, Inc.

      * Preferred stock rating to B2, from B3.

   -- Equity Inns Partnership, L.P.

      * Issuer rating assignment of Ba3.

The rating outlook for Equity Inns is stable.

Equity Inns, Inc. [NYSE: ENN] is based in Memphis, Tennessee, USA,
and is a self-advised real estate investment trust (REIT) and is
the largest US REIT focused on the upscale extended stay,
all-suite and midscale limited-service segments of the hotel
industry.  Equity Inns became publicly traded in 1994 and is now
the oldest public hotel REIT in the USA.  The REIT owns a
geographically diverse portfolio of over 110 hotels with over
13,500 rooms, located in 34 states.  The hotel portfolio is
managed by several leading independent lodging and hotel
management companies.  Over 95% of Equity Inns' hotel portfolio is
comprised of the following franchise brands: Homewood Suites,
Hampton Inn, Hampton Inn & Suites and Hilton Garden Inn by Hilton,
Residence Inn, Courtyard and SpringHill Suites by Marriott and
AmeriSuites by Hyatt Corporation.


FALCON PRODUCTS: Committee Taps XRoads Solutions as Fin'l Advisors
------------------------------------------------------------------
The U.S. Bankruptcy Court for the Eastern District of Missouri
gave the Official Committee of Unsecured Creditors of Falcon
Products Inc. and its debtor-affiliates permission to employ
XRoads Solutions Group, LLC, as its financial advisors.

XRoads Solutions will:

   a) analyze the Debtors' current businesses, including their
      organizational structure, operations, market position and
      opportunities, cost structure, customer and vendor
      relationships and financial condition to identify the
      existing problems, strengths, solutions and opportunities of
      the businesses;

   b) review and analyze the Debtors' business plans and financial
      projections, and review documentation related to claims held
      by the creditors, including reviewing and evaluating claims
      and classes of claims filed against the Debtors;

   c) review financial information including monthly operating
      reports, budgets and other analyses, and the Debtors'
      proposed chapter 11 plan; and

   d) review disposition of the Debtor's assets and liabilities
      with respect to creditors' claims.

John Tittle, Jr., a Principal at XRoads Solutions, reports the
Firm's professionals' bill:

      Designation             Hourly Rate
      ------------            -----------
      Principals                 $500
      Managing Directors      $375 - $475
      Directors               $325 - $400
      Senior Directors        $300 - $375
      Consultants             $225 - $125
      Associates              $125 - $150
      Administrators          $100 - $125

XRoads Solutions assures the Court that it does not represent any
interest materially adverse to the Committee, the Debtors or their
estates.

Headquartered in Saint Louis, Missouri, Falcon Products, Inc. --
http://www.falconproducts.com/-- designs, manufactures, and
markets an extensive line of furniture for the food service,
hospitality and lodging, office, healthcare and education segments
of the commercial furniture market.  The Debtor and its eight
debtor-affiliates filed for chapter 11 protection on January 31,
2005 (Bankr. E.D. Mo. Lead Case No. 05-41108).  Brian Wade
Hockett, Esq., and Mark V. Bossi, Esq., at Thompson Coburn LLP
represent the debtors in their restructuring efforts.  When the
Debtors filed for protection from their creditors, they listed
$264,042,000 in assets and $252,027,000 in debts.


FALCON PRODUCTS: Wants Exclusive Periods Extended Until Aug. 1
--------------------------------------------------------------
Falcon Products Inc. and its debtor-affiliates ask the U.S.
Bankruptcy Court for the Eastern District of Missouri for an
extension, through and including Aug. 1, 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 Sept. 30, 2005.

The Debtors give the Court four reasons why the extension is
warranted:

   a) the Debtors chapter 11 cases are large and complex, with 800
      claims filed and over 1,640 employees, and the various
      operational and administrative matters related to the
      bankruptcy cases have occupied a considerable amount of time
      and energy on the Debtors' time and effort since the
      Petition Date;

   b) the Debtor's overall restructuring plan is still a work in
      progress and they would like to share and discuss the terms
      of a proposed chapter 11 plan to their creditor
      constituencies;

   c) the Debtors are current on all their post-petition payment
      obligations; and

   d) the Debtors are not using the requested extension to
      pressure their creditors into supporting an unacceptable
      plan and the requested extension will not prejudice the
      Debtors' creditors and other parties in interest.

Headquartered in Saint Louis, Missouri, Falcon Products, Inc. --
http://www.falconproducts.com/-- designs, manufactures, and
markets an extensive line of furniture for the food service,
hospitality and lodging, office, healthcare and education segments
of the commercial furniture market.  The Debtor and its eight
debtor-affiliates filed for chapter 11 protection on Jan. 31, 2005
(Bankr. E.D. Mo. Lead Case No. 05-41108).  Brian Wade Hockett,
Esq., and Mark V. Bossi, Esq., at Thompson Coburn LLP represent
the debtors in their restructuring efforts.  When the Debtors
filed for protection from their creditors, they listed
$264,042,000 in assets and $252,027,000 in debts.


FEDDERS CORP: Delays Filing of Annual & Quarterly Reports
---------------------------------------------------------
Fedders Corporation, has not timely filed its quarterly report on
Form 10-Q for the first fiscal quarter of 2005 with the Securities
and Exchange Commission.  The Company's financial statements for
its first fiscal quarter cannot be completed until the fiscal year
2004 financial statements are completed.  The company cannot, at
this time, estimate when the Quarterly Report on Form 10-Q will be
filed.

As previously reported, the company was advised by Deloitte &
Touche on April 14, 2005, that it will not stand for reappointment
as the company's registered public accounting firm for the year
ending December 31, 2005 or for any quarterly periods in the year.
The company is currently interviewing accounting firms to succeed
Deloitte & Touche.  Upon completion of the company's financial
statements for fiscal year 2004, the company's new registered
public accounting firm will undertake its review of the company's
fiscal first quarter financial statements, completion of which is
required before the Form 10-Q can be filed.

                       About Fedders Corp.

Fedders Corporation manufactures and markets worldwide air
treatment products, including air conditioners, air cleaners, gas
furnaces, dehumidifiers and humidifiers and thermal technology
products.

                          *     *     *

As reported in the Troubled Company Reporter on March 22, 2005,
Standard & Poor's Ratings Services lowered its ratings on air
treatment products manufacturer Fedders Corp., and Fedders North
America, Inc., including its corporate credit ratings to 'CCC'
from 'CCC+' following the company's announcement that it will
delay filing its Form 10-K for the fiscal year ended Dec. 31,
2004.  The delay was necessary because Fedders was unable to
complete its financial statements, including preparing supporting
documentation and providing this information to its auditors.


FORD CREDIT: Fitch Lifts Ratings on Series 2002-C Class D Certs.
----------------------------------------------------------------
Fitch Ratings upgraded 14 classes of six Ford Credit Auto Owner
Trust asset-backed transactions, as follows:

                    Series 2003-B

    -- Class B-1 notes to 'AAA' from 'AA-';
    -- Class B-2 notes to 'AAA' from 'AA-';
    -- Class C notes to 'A+' from 'BBB+'.

                    Series 2003-A

    -- Class B-1 notes to 'AAA' from 'AA-';
    -- Class B-2 notes to 'AAA' from 'AA-';
    -- Class C notes to 'AA' from 'BBB+'.

                    Series 2002-D

    -- Class B notes to 'AAA' from 'AA';
    -- Class C notes to 'AAA' from 'BBB+'.

                    Series 2002-C

    -- Class B notes to 'AAA' from 'AA';
    -- Class C notes to 'AAA' from 'BBB+';
    -- Class D certificates to 'BBB+' from 'BB+'.

                    Series 2002-B

    -- Class B notes to 'AAA' from 'AA+';
    -- Class C notes to 'AAA' from 'AA-'.

                    Series 2002-A

    -- Class C notes to 'AAA' from 'AA'.

The rating upgrades are a result of increased available credit
enhancement in excess of expected remaining losses.  Under the
credit enhancement structure, the bonds can now withstand stress
scenarios consistent with the upgraded ratings and still make full
and timely payments of principal and interest.  As before, the
ratings reflect the quality of Ford Motor Credit Co.'s retail auto
loan originations, the sound financial and legal structure of the
transactions, and servicing provided by Ford Motor Credit Co.


FOOTSTAR INC.: Kmart Wants Footstar to Vacate 13 More Stores
------------------------------------------------------------
As previously reported in the Troubled Company Reporter on
March 28, 2005, Kmart Corporation asked the U.S. Bankruptcy Court
for the Southern District of New York to lift the automatic stay
to require Footstar, Inc., to vacate certain Kmart stores.

On February 3, 2005, Kmart notified Footstar that it plans to
begin the reconfiguration of Stores scheduled for conversion to an
alternative format in April.  Kmart instructed Footstar that, by
as early as February 21, 2005, Footstar could either vacate those
Stores or have the footwear departments in those Stores relocated
around the conversion-related construction until the conversion
date -- when Footstar would be evicted.

Julie A. Younglove-Webb, Vice President/Space Planning for Kmart
Corporation, explains that as a result of Sears, Roebuck and
Co.'s acquisition of 50 Kmart and six Wal-Mart stores finalized in
the third quarter 2004, 25 Sears Essentials stores are scheduled
to open this Spring.  Following the opening of Sears Essentials,
Sears' point-of-sale systems will track store sales and transmit
this information to Sears' headquarters in Hoffman Estates,
Illinois, for recording, analysis and decision-making by Sears'
employees.  Among other effects of this switch from Kmart to Sears
POS systems is that Kmart's merchandise, including that sold by
Footstar, will not be capable of being scanned in the store.

               Kmart Wants 13 More Stores Vacated

Amy R. Wolf, Esq., at Wachtell, Lipton, Rosen & Katz, in New York,
informs the U.S. Bankruptcy Court for the Southern District of New
York that since April 1, 2005, plans have been finalized to
convert 13 more stores into Sears Essentials stores.  These stores
are slated to close as Kmart stores and reopen as Sears Essentials
stores:

   (a) Five stores to close on July 20, 2005:

       * 4224 Denver, Colorado;
       * 7772 Noblesville, Indiana;
       * 3559 Homer Glen, Illinois;
       * 3988 Putnam, Connecticut; and
       * 4206 Warren, Michigan;

   (b) Eight stores to close on August 10, 2005:

       * 7678 Mission Valley, California;
       * 7636 Chula Vista, California;
       * 7418 San Ysidro, California;
       * 3476 Clearwater, Florida;
       * 4039 South Bend, Indiana;
       * 4869 Deland, Florida;
       * 4869 Lawnside, New Jersey; and
       * 4343 West Palm Beach, Florida.

Kmart asks the Court to compel Footstar to vacate the additional
13 stores.

Headquartered in West Nyack, New York, Footstar Inc., retails
family and athletic footwear.  As of August 28, 2004, the Company
operated 2,373 Meldisco licensed footwear departments nationwide
in Kmart, Rite Aid and Federated Department Stores.  The Company
also distributes its own Thom McAn brand of quality leather
footwear through Kmart, Wal-Mart and Shoe Zone stores.  The
Company and its debtor-affiliates filed for chapter 11 protection
on March 3, 2004 (Bankr. S.D.N.Y. Case No. 04-22350).  Paul M.
Basta, Esq., at Weil Gotshal & Manges represents the Debtors in
their restructuring efforts.  When the Debtor filed for chapter 11
protection, it listed $762,500,000 in total assets and
$302,200,000 in total debts.


FRIEDMAN'S INC: Creditors Must File Proofs of Claim by June 30
--------------------------------------------------------------
The United States Bankruptcy Court for the Southern District of
Georgia, Savannah Division, set June 30, 2005 at 5:00 p.m., as
the deadline for all creditors owed money by Friedman's Inc. and
its debtor-affiliates on account of claims arising prior to
January 14, 2005, to file their proofs of claim.

Governmental units must file proofs of claims on or before
July 13, 2005.

Creditors must file written proofs of claim on or before the June
30 Claims Bar Date and those forms must be sent either by mail, or
hand delivery, courier or overnight service to:

      Friedman's Inc. Claims Processing
      c/o Kurtzman Carson Consultants LLC
      12910 Culver Blvd., Ste. 1
      Los Angeles, California 90066

Any person or entity that holds a claim arising from the rejection
of an executory contract or unexpired lease must file a proof of
claim on or before June 30, 2005 or 30 days after the effective
date of rejection ordered by the Bankruptcy Court, whichever is
later.

Holders of equity security interests in the Debtor need not file
proofs of interest with respect to the ownership of those equity
interests, provided, however, if any holder that asserts a claim
against the Debtor (including a claim relating to an equity
interest or the purchase or sale of such equity interest), a proof
of such claim must be filed on or before June 30, 2005.

Headquartered in Savannah, Georgia, Friedman's Inc. --
http://www.friedmans.com/-- is the parent company of a group of
companies that operate fine jewelry stores located in strip
centers and regional malls in the southeastern United States.  The
Company and its affiliates filed for chapter 11 protection on Jan.
14, 2005 (Bankr. S.D. Ga. Case No. 05-40129).  John W. Butler,
Jr., Esq., George N. Panagakis, Esq., Timothy P. Olson, Esq., and
Alexa N. Paliwal, Esq., at Skadden, Arps, Slate, Meagher & Flom
LLP represent the Debtors in their restructuring efforts.  When
the Debtors filed for protection from their creditors, they listed
$395,897,000 in total assets and $215,751,000 in total debts.


GENERAL MARITIME: New Dividend Policy Prompts S&P to Hold Ratings
-----------------------------------------------------------------
Standard & Poor's Ratings Services affirmed its ratings, including
the 'BB' corporate credit rating, on General Maritime Corp. and
removed all ratings from CreditWatch, where they were placed with
negative implications on Jan. 27, 2005.  The rating outlook is
stable.  The January CreditWatch placement followed General
Maritime's announcement of a new dividend policy, under which
shareholders would receive a significant proportion of the
company's cash flow.

"The affirmation of the corporate credit rating reflects General
Maritime's improved cash flow generation and significant debt
reduction, tempered by the company's adoption of an aggressive
dividend policy," said Standard & Poor's credit analyst Ken Farer.
General Maritime had $457 million of lease-adjusted debt at March
31, 2005.

Ratings on New York, New York-based General Maritime reflect:

    (1) the company's significant, but managed, exposure to the
        volatile tanker spot markets,

    (2) an aggressive growth and dividend strategy, and

    (3) participation in the high-risk bulk ocean shipping
        industry.

These negative factors are partly offset by:

    (1) General Maritime's competitive position as one of the
        largest operators of Aframax and Suezmax vessels,

    (2) its success in reducing its debt leverage, and

    (3) satisfactory access to liquidity.

The oil tanker shipping industry--especially the larger vessel
classes--is seen as having a very high risk profile as a result of
volatility in freight rates and asset values, which results from:

    -- High capital intensity;

    -- Very competitive and fragmented markets;

    -- Lack of meaningful vessel supply discipline; and

    -- Periodic local and/or regional supply disruptions.

To counter this rate volatility, shipping companies may utilize
time charter contracts, which provide a base level of revenues and
earnings.  General Maritime's exposure to the spot market is
significant, with only 15% of the company's 2004 revenues (11 of
its 43 vessels) generated from vessels operating on time charters.

General Maritime operates 43 oceangoing vessels--26 Aframax
tankers and 17 Suezmax vessels--with four additional vessels on
order.  The company's fleet size is substantial, and its fleet is
approximately the same average age as the global fleet.  Since the
company's founding by Peter C. Georgiopoulos, chairman and CEO,
who remains the driving force behind the company, General
Maritime has expanded mainly through acquiring vessels, rather
than ordering new ships.  Recent acquisitions include the 19
vessels from Metrostar Management Corp. in May 2003 for $525
million and five vessels from Soponata S.A. in March 2004 for $247
million, plus the assumption of $168 million of future vessel
commitments on four additional vessels.

General Maritime is expected to continue reporting strong revenue,
earnings, and cash flow measures due to the current favorable
tanker rate environment and low debt levels.  An outlook revision
to negative is not likely, even if the tanker market weakens
somewhat, as credit measures should remain appropriate for the
current rating.  However, if the company adopts a more aggressive
financial profile or does not reduce its leverage following a
large acquisition, the outlook could be revised to negative.
Standard & Poor's believes an outlook revision to positive is
unlikely in the near term due to the company's aggressive dividend
policy and growth aspirations.


GENTEK INC: Posts $1 Million Net Loss in First Quarter 2005
-----------------------------------------------------------
GenTek Inc. (NASDAQ: GETI) reported results for the three months
ending March 31, 2005.  For the first quarter of 2005, GenTek had
revenues totaling $226.3 million and operating profit of
$2.9 million, compared to revenues of $192.9 million and operating
profit of $22.1 million in the prior-year period.  Also for the
quarter, the company recorded a net loss of $1.0 million, compared
to net income of $14.8 million, including earnings from
discontinued operations in the first quarter of 2004.

The increase in revenues was driven primarily by the impact of the
company's acquisition of the Reynosa, Mexico wire-harness
operation in June 2004 from Whirlpool Corporation. Higher revenues
in the water chemicals and personal care markets were
substantially offset by lower fine chemical sales primarily due to
the closer of the company's Delaware Valley North plant in 2004.
The decrease in operating income versus the prior year was
principally due to the impact of a $14.8 million pension
curtailment gain recorded in 2004, as well as $3.6 million of
higher restructuring costs in the first three months of 2005
versus the same period last year. GenTek's 2004 results reflect
the classification of its KRONE communications operating unit
as a discontinued operation due to the sale of that business on
May 18, 2004.

The company had $10 million of cash and $389 million of debt
outstanding as of March 31, 2005, reflecting the recapitalization
of the company completed during the first quarter, including the
payment of a $31 per common share dividend and a $35 million pre-
funding of certain defined benefit pension liabilities.

                        Adjusted EBITDA

The company has presented adjusted earnings before interest,
taxes, depreciation and amortization (adjusted EBITDA) as a
measure of operating results. Adjusted EBITDA reflects removing
the impact of any restructuring, impairment, income from
discontinued operations and certain one-time items. Adjusted
EBITDA is a non-GAAP (Generally Accepted Accounting Principles)
measure, and, as such, a reconciliation of adjusted EBITDA to net
income is provided in the attached Schedule 2. GenTek has
presented adjusted EBITDA as a supplemental financial measure as a
means to evaluate performance of the company's business. GenTek
believes that, when viewed with GAAP results and the accompanying
reconciliation, it provides a more complete understanding of
factors and trends affecting the company's business than the GAAP
results alone. In addition, the company understands that adjusted
EBITDA is also a measure commonly used to value businesses by its
investors and lenders.

During the first quarter of 2005, adjusted EBITDA was
$17.9 million compared with $16.8 million in the first quarter
of 2004. This 6.5% improvement in adjusted EBITDA was driven
primarily by the company's performance chemicals segment. Cost
containment initiatives that resulted in reduced general and
administrative expenses, along with continued success in passing
through previously incurred raw material price increases in the
company's water chemicals business and reduced pension and other
post-retirement costs contributed to the improvement. The impact
of lower sales volumes to the company's North American automotive
customer base and higher raw material costs partially offset the
improved results in performance chemicals.

"I am very pleased with our first-quarter results, particularly
the substantial improvements made within our performance chemicals
segment," said Richard R. Russell, GenTek's president and CEO.
"While we've begun to see reduced sales volumes from some of our
automotive customers during the quarter, we continue to take
aggressive action to minimize the impact of such lower volumes on
our full year performance. In addition, the restructuring actions
taken during the quarter are key to our ongoing strategic plan to
streamline the company's cost structure, which we believe will
continue to enhance our profitability and cash flow."

                        About GenTek Inc.

GenTek Inc. -- http://www.gentek-global.com/-- provides specialty
inorganic chemical products and services for treating water and
wastewater, petroleum refining, and the manufacture of personal-
care products.  The company also produces valve-train systems and
components for automotive engines and wire harnesses for large
home appliance and automotive suppliers, as well as other cable
products.  GenTek operates over 60 manufacturing facilities and
technical centers and has more than 6,900 employees.

GenTek's 2,000-plus customers include many of the world's leading
manufacturers of cars and trucks, heavy equipment, appliances and
office equipment, in addition to global energy companies and
makers of personal-care products.

                        *     *     *

As reported in the Troubled Company Reporter on Feb. 24, 2005,
Moody's Investors Service has assigned the following new ratings
to GenTek Inc., a diversified industrial company.  The rating
outlook is stable.  The ratings and outlook are subject to review
of the final documentation of the financing transaction.

The new ratings assigned are:

   * B2 for the $60 million senior secured revolving credit
     facility, due 2010,

   * B2 for the $235 million senior secured term loan B, due 2011,

   * Caa1 for the $135 million second-lien term loan, due 2012,

   * B2 senior implied rating,

   * Caa2 issuer rating,

The ratings reflect GenTek Inc.'s significant debt leverage and
substantial operational challenges in its post-reorganization
operations.  The ratings also factor in the highly cyclical nature
of the company's revenue base, poor financial performance in
recent years, exposure to commodity price increases, under-funded
pension liabilities, and modest cash flow generation.  On the
other hand, the ratings recognize the potential benefits from a
number of restructuring and cost-cutting initiatives that the
company is undertaking, as well as currently adequate liquidity
condition.

The rating outlook is currently stable.  Factors that could have
negative rating implications include a failure to realize the
projected benefits from its restructuring plans and deterioration
in its key end-market conditions.  Factors that could have
positive rating implications include a substantial improvement in
financial performance and meaningful debt reductions.


GLOBAL TEL*LINK: Moody's Rates $22.5M 2nd Priority Loan at B3
-------------------------------------------------------------
Moody's Investors Service assigned a B1 senior implied rating to
Global Tel*Link Corporation, a B1 rating to the first lien senior
secured credit facilities, and a B3 to the second lien senior
secured term loan of the company, as described below.  The outlook
for these ratings is stable.

The assigned ratings are:

   * Senior implied B1

   * $7.5 million six-year senior first priority funded letter of
     credit facility B1

   * $12.5 million five-year senior first priority revolving
     credit facility B1

   * $55 million six-year first priority term loan facility B1

   * $22.5 million seven-year second priority term loan B3

The B1 senior implied rating reflects Moody's opinion of the
reasonable leverage of the borrower, with funded debt representing
roughly 72% of total capital, and total debt/EBITDA of under 4.0
times.  The B1 also reflects GTL's good market position in the
transforming inmate telecommunications industry that, despite the
departure of many large established telecom carriers, is expected
to remain a $2 billion market.  Negatively, the B1 reflects
Moody's concerns regarding GTL's low operating margins as well as
the integration risk attendant upon GTL's acquisition of a much
larger inmate telecommunications division from a major telecom
carrier.  Further, Moody's is concerned that the new GTL may face
additional sales and marketing challenges both renewing acquired
contracts and seeking new business not having the benefit of the
brand of the major carrier.

The B1 rating on the first priority credit facilities reflects
their predominance at over 70% of GTL's debt capital structure.
The B3 rating on the $22.5 million second-lien term loan reflects
its effective subordination to the claims of the first priority
lenders.  Moody's believes that most of the value of the combined
enterprise lies in its contracts with various correctional
facilities to be their telecommunications provider, rather than
its hard assets, and thus lenders to the second lien term loan are
likely to have poorer prospects for principal recovery in a stress
scenario.

The ratings outlook is stable reflecting Moody's opinion that
while liquidity may be tight initially, as GTL funds the remainder
of the acquisition purchase price within 75 days of closing, GTL
will have access to its $12.5 million revolver.  The ratings could
be positively affected should GTL improve profitability to
generate free cash flows (cash from operations less capital
expenditures) of 10% of total debt.  The ratings are likely to be
negatively affected should integration or other challenges reduce
cash flows and GTL is unable to generate sustainable free cash
flows.

The proposed senior secured bank financing, along with a
$22 million equity contribution, will fund the purchase of the
inmate telecommunications division of a large telecom carrier and
retire existing GTL debt.  Combined with an earlier $7.5 million
equity contribution for the Jan-05 acquisition of GTL from
Schlumberger Ltd., Gores Technology Group will have invested
$29.5 million in equity to the combined operations.  Pro forma for
recently signed contracts and other expense adjustments, the
combined company produced $21.3 million of adjusted EBITDA in
2004, or 3.6x total debt.

GTL has historically been both direct provider of inmate
telecommunications services and a "platform" provider to other
carriers (primarily MCI) who don't have the specialized hardware
and software required to meet the unique demands of a correctional
facility.  The acquisition target, as an inmate telecommunications
division of a large carrier, does not have its own platform and
therefore subcontracts such work to independents such as GTL and
others.  The target acquisition provides GTL with the opportunity
to improve its profitability by taking in-house that work that
this acquired division currently subcontracts to others.  The
combined company will serve approximately 1,300 correctional
facilities.

Moody's notes that the inmate calling industry faces ongoing
regulatory risk.  Inmates, their families, and inmate advocacy
organizations have repeatedly challenged the inmate calling
service providers in court and at the FCC complaining of the high
costs of inmate phone calls.  These complaints generally allege
that the rates charged are excessive due to the exclusive service
arrangements between inmate calling service providers and the
correctional facilities as well as the commission rates paid to
the correctional facilities.  However, the industry has withstood
previous challenges to its regulatory regime, with the FCC noting
the special security requirements applicable to inmate calls.

Based in Mobile, Alabama, Global Tel*Link is an independent
provider of telecommunications services to correctional
facilities.


GOODYEAR TIRE: Names Joseph Copeland CEO of Australian Venture
--------------------------------------------------------------
The Goodyear Tire & Rubber Company (NYSE: GT) named Joseph
Copeland, senior vice president of business development, strategy
and restructuring, as its Chief Executive Officer of South Pacific
Tyres, the company's 50 percent-owned joint venture in Australia.

Mr. Copeland, 43, has held his present position since November
2004 and was president of the company's former Chemical business
for two years before that.

"I'm glad that Joe has agreed to lead South Pacific Tyres through
this important stage of its turnaround," said Goodyear Chairman
and Chief Executive Officer Robert J. Keegan.  "His experience,
leadership capabilities and track record of success make him
ideally suited for this assignment."

Mr. Copeland will report to the South Pacific Tyres Board of
Directors.  In addition, he will report to Pierre Cohade,
president of Goodyear's Asia/Pacific tire business, for the
purpose of coordination between Goodyear and South Pacific Tyres
operations.

Darren R. Wells, currently vice president and treasurer, has been
named senior vice president, business development and treasurer.
He will continue to report to Richard. J. Kramer, executive vice
president and chief financial officer.  In addition to continuing
his role as treasurer, Mr. Wells will assume Copeland's business
development responsibilities as well as additional oversight
responsibilities for the investor relations and tax functions.

"Darren's expanded leadership role will provide significant
synergies for our capital markets and business development
activities," said Kramer.

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

Before joining Goodyear, Mr. Copeland served in management roles
at Ford Motor Company and Intel Corporation.  While at Ford,
between 1995 and 1997, Mr. Copeland served on the team that
introduced the successful Jaguar S-Type luxury vehicle line.  He
also helped structure Ford's entry into the India market through
the creation of a joint venture. At Intel, from 1997 to 2000,
Copeland was senior finance manager for its e-commerce and
Internet marketing group, where he helped develop the strategy for
the company's entry into the channel.

Prior to his corporate experience, Mr. Copeland practiced
corporate law in Washington, D.C., from 1988 to 1993.  He received
a bachelor's degree in accounting in 1983 and his law degree in
1988, both from Baylor University.  He received his master of
business administration degree in finance in 1995 from the
University of Chicago.

Mr. Wells, 39, joined Goodyear in 2002 from Visteon Corporation,
where he was assistant treasurer for two years and led the
development of a treasury operation, as the parts manufacturer was
spun-off from Ford.

Before joining Visteon, Mr. Wells worked in Ford's Australian
operations from 1998 to 2000.  He served as controller of Ford
Investment Enterprises and as finance director of Ford Credit
Australia.

Previously, Mr. Wells was manager of international financing for
Ford Motor Credit Company from 1996 to 1997 and supervisor,
financial analysis from 1992 to 1996. He joined the company in
1989 as a financial analyst.

Mr. Wells has a bachelor of arts degree from DePauw University and
a master of business administration degree in finance from Indiana
University.

Goodyear is the world's largest tire company.  The company
manufactures tires, engineered rubber products and chemicals in
more than 90 facilities in 28 countries around the world. Goodyear
employs approximately 80,000 people worldwide.

                        *     *     *

As reported in the Troubled Company Reporter on Apr. 15, 2005,
Fitch Ratings has assigned indicative ratings to The Goodyear Tire
& Rubber Company's -- GT -- new domestic senior secured bank
facilities which the company announced earlier this week had been
closed:

     -- $1.5 billion asset-based first-lien revolving credit
        facility 'B+';

     -- $1.2 billion second-lien term loan 'B';

     -- $300 million third-lien term loan facility 'B-'.

Fitch also affirmed its rating of 'CCC+' for GT's senior unsecured
debt.  The new bank facilities replace approximately $2.6 billion
of existing domestic bank facilities.  The Rating Outlook is
Stable.

In addition, Fitch has initiated an indicative rating of 'B+' on
new senior secured, first-lien European bank facilities for GT's
subsidiary, Goodyear Dunlop Tires Europe B.V. -- GDTE -- that were
completed at the same time as GT's domestic facilities.  The new
GDTE facilities consist of $650 million equivalent of Euro-
denominated revolving and term loan facilities and replaced a
similar amount of existing bank facilities under which $400
million was outstanding at the end of 2004.  Fitch says the Rating
Outlook is Stable.


GREAT ATLANTIC: Restructuring Prompts S&P's Developing Outlook
--------------------------------------------------------------
Standard & Poor's Ratings Services revised its outlook on Great
Atlantic & Pacific Tea Co. to developing from negative, following
A&P's announcement that it plans a major strategic restructuring.

All ratings, including the 'B-' corporate credit rating, are
affirmed.

"The 'B-3' short-term rating will be raised to 'B-2' after the
restructuring, contingent upon a meaningful portion of proceeds
being applied to debt reduction and a successful renewal of the
bank facility under the new capital structure," said Standard &
Poor's credit analyst Mary Lou Burde.

The restructuring will include:

    (1) the potential sale of A&P Canada,

    (2) the divestiture of the Midwest operations, and

    (3) a focus on A&P's core operations from Connecticut to
        Washington, D.C.

The potential sale of the Canadian division could generate
substantial proceeds, which will enhance liquidity for the short
term.

Standard & Poor's believes the Montvale, New Jersey-based company
will use a portion of proceeds to reduce debt, including
eliminating maturities for the next one to two years.  The balance
of cash is likely to be used for internal or external investments
to strengthen core operations of the new A&P.  If these
investments achieve a good return and the business improves, the
rating could be raised.  Although Standard & Poor's does not
expect near-term pressure on the rating following the disposals,
if the business fails to improve and liquidity diminishes, the
rating could be lowered.

A&P continues to be challenged by:

    (1) soft sales,

    (2) competitive pressures from traditional and nontraditional
        food retailers,

    (3) a high cost structure, and

    (4) a leveraged balance sheet.

Profitability has been poor for several years despite numerous
attempts to:

    (1) reduce overhead,

    (2) improve the supply chain, and

    (3) restructure the store base.

Although asset sale proceeds enabled the company to step up its
capital spending somewhat in 2004, the company has lacked
sufficient resources to execute its long-term plans.


HAYES LEMMERZ: Apollo Demands Registration of Equity Stake
----------------------------------------------------------
Members of AP Wheels, LLC, are various funds managed by Apollo
Management V, L.P., Amalgamated Gadget, L.P., and Perry Corp. that
hold shares on behalf of one or more funds managed by them.  The
members are:

    1. Apollo Investment Fund V, L.P.
    2. Apollo Overseas Partners V, L.P.
    3. Apollo Netherlands Partners V (A), L.P.
    4. Apollo Netherlands Partners V (B), L.P.
    5. Apollo German Partners V GmbH & Co. KG

Apollo Management V, L.P., serves as the day-to-day manager of AP
Wheels and its members.  Apollo Advisors V, L.P., is the general
partner of each of the members of AP Wheels.  AIF V Management,
Inc., is the general partner of Apollo Management V, L.P.  Apollo
Capital Management V, Inc., is the general partner of Apollo
Advisors V, L.P.  Leon Black and John Hannan are the executive
officers and directors of AIF V Management, Inc., and Apollo
Capital Management V, Inc.

Hayes Lemmerz International, Inc., Vice President for Finance and
Chief Financial Officer James A. Yost relates in the Company's
2004 Annual Report filed with the Securities and Exchange
Commission that any of the Apollo entities or funds managed by
them could acquire additional shares in the future.  "These
entities are in the business of making investments in, and
acquiring, other companies, and may from time to time hold
interests in companies that compete directly or indirectly with
us."

According to Mr. Yost, Hayes executed a Registration Rights
Agreement with Apollo dated as of July 1, 2004.  In connection
with the Registration Agreement, Hayes is required, under certain
conditions, to file a registration statement to register the
shares owned by Apollo in Hayes, and to take other actions to
assist with the sale of Apollo's shares.  Hayes is required to
file the registration statement within 45 days of receipt of a
demand notice from Apollo; provided however, that Hayes may delay
the filing of the registration statement for up to an additional
90 days under certain conditions.

In March 2005, Hayes received a demand notice from Apollo
requesting it to file a registration statement with respect to all
of Apollo's shares.

            Hayes Registers AP Wheels LLC's Equity Stake

On May 6, 2005, Hayes filed a Form S-3 with the SEC to register
3,470,374 shares of common stock, of which:

    (a) 30,492 Shares are issuable upon the exercise, if any, of
        Hayes' outstanding series A warrants held by Apollo; and

    (b) 92,899 Shares are or may become issuable during the period
        Hayes agreed to keep the registration statement effective
        upon exchange of shares of Series A Cumulative
        Exchangeable Preferred Stock, par value $1.00 per share,
        of HLI Operating Company, Inc., held by Apollo.

A full-text copy of the Registration Rights Agreement is available
at the Securities and Exchange Commission:


http://www.sec.gov/Archives/edgar/data/1237941/000095012405003056/k95024sv3.htm

Curtis J. Clawson, Hayes' president and chief executive officer
and chairman of the board, relates that the Shares are being
registered to permit Apollo to sell the Shares from time to time
in the public market.  "The Selling Stockholder may sell any or
all of the Shares available to it for sale, subject to federal and
state securities laws, but is under no obligation to do so.
We will not receive any proceeds from the offering of any such
Shares."  According to Mr. Clawson, Apollo may sell the Shares
through ordinary brokerage transactions or through any other
means.  The prevailing market for the Shares or in negotiated
transactions will determine the price at which Apollo may sell the
Shares, Mr. Clawson adds.

                         The Series A Warrants

The Series A Warrants held by Apollo entitle it to purchase up to
30,492 Shares at a cash exercise price of $25.83 per share,
subject to adjustment as provided in the warrant agreement.  On
May 5, 2005, the closing sale price per share of the common stock,
as reported by the Nasdaq National Market, was $5.91.  The warrant
agreement provides for redemption of the unexercised warrants in
the case of certain extraordinary transactions for an amount per
warrant equal to the greater of:

    (1) the fair market value of the consideration given in the
        extraordinary transaction less the purchase price;

    (2) the value of the warrant at the consummation of the
        extraordinary transaction; or

    (3) $0.01.

In addition, the Series A Warrants are subject to anti-dilution
adjustments to the purchase price for the events, including, but
not limited to, the issuance of:

    -- additional shares of common stock;

    -- extraordinary dividends and distributions;

    -- the issuance of options and convertible securities, except
       for the issuances pursuant to equity-based compensation
       plan for directors or employees; and

    -- stock dividends or stock splits or the combination or
       consolidation of the outstanding shares of common stock.

The warrant agreement also provides that in the event of a merger,
consolidation or similar transaction involving Hayes in which the
holders of Hayes' common stock receive capital stock or other
securities of Hayes or the surviving entity, the unexercised
warrants will become exercisable for that consideration.

The Series A Warrants expire on June 3, 2006.

                         HLI Preferred Stock

The shares of Preferred Stock held by Apollo are, at the holder's
option, exchangeable into a number of Shares of Hayes common stock
equal to (i) the aggregate liquidation preference of the shares of
Preferred Stock so exchanged ($100 per share plus all accrued and
unpaid dividends thereon (whether or not declared) to the exchange
date) divided by (ii) 23.125.

As of May 6, 2005, Apollo is deemed to beneficially own 88,942
Shares of common stock as a result of the Preferred Stock it holds
of record.

The Preferred Stock may be redeemed by HLI at its option, at any
time, or from time to time, after June 3, 2013, for either:

    -- cash equal to the Liquidation Preference; or

    -- a number of shares of common stock of Hayes equal to the
       Liquidation Preference divided by the fair value of the
       common stock on the date of redemption, based on the
       average closing price of the common stock during the 20
       business days prior to the date of the notice of
       redemption.

Hayes Lemmerz International, Inc., is a world leading global
supplier of automotive and commercial highway wheels, brakes,
powertrain, suspension, structural and other lightweight
components.  The Company filed for chapter 11 protection on
December 5, 2001 (Bankr. D. Del. Case No. 01-11490) and emerged in
June 2003.  Eric Ivester, Esq., and Mark S. Chehi, Esq., at
Skadden, Arps, Slate, Meager & Flom represent the Debtors.  (Hayes
Lemmerz Bankruptcy News, Issue No. 64; Bankruptcy Creditors'
Service, Inc., 215/945-7000)

                         *     *     *

As reported in the Troubled Company Reporter on April 11, 2005,
Moody's Investors Service assigned a B2 rating for HLI Operating
Company, Inc.'s proposed $150 million guaranteed senior secured
second-lien term loan facility.  HLI Opco is an indirect
subsidiary of Hayes Lemmerz International, Inc.  The rating
outlook remains stable.

While the company has reaffirmed its earning guidance and the
senior implied and guaranteed senior secured first-lien facility
ratings remain unchanged at B1, Moody's determined that widening
of the downward notching of HLI Opco's guaranteed senior unsecured
notes was necessary to reflect additional layering of the
company's debt.  The senior unsecured notes are effectively
subordinated to the proposed new senior secured second-lien term
facility, and approximately $75 million of higher-priority debt
will be added to the capital structure.

These specific rating actions were taken by Moody's:

   * Assignment of a B2 rating for HLI Operating Company, Inc.'s
     proposed $150 million guaranteed senior secured second-lien
     credit term loan C due June 2010;

   * Downgrade to B3, from B2, of the rating for HLI Operating
     Company, Inc.'s $162.5 million remaining balance of 10.5%
     guaranteed senior unsecured notes maturing June 2010 (the
     original issue amount of $250 million was reduced as a result
     of an equity clawback executed in conjunction with Hayes
     Lemmerz's February 2004 initial public equity offering);

   * Affirmation of the B1 ratings for HLI Operating Company,
     Inc.'s approximately $527 million of remaining guaranteed
     senior secured first-lien credit facilities, consisting of:

   * $100 million revolving credit facility due June 2008;

   * $450 million ($427.3 million remaining) bank term loan B
     facility due June 2009 (which term loan is still expected to
     be partially prepaid through application of about half of the
     net proceeds of the proposed incremental debt issuance);

   * Affirmation of the B1 senior implied rating;

   * Downgrade to Caa1, from B3, of the senior unsecured issuer
     rating (which rating does not presume the existence of
     subsidiary guarantees).


INDEPENDENCE III: Moody's Junks $22 Mil. Classes C-1 & C-2 Notes
----------------------------------------------------------------
Moody's Investors Service lowered the ratings of two classes of
notes issued by Independence III CDO, Ltd.:

   * to A2 (from A1), the U.S. $18,000,000 Class B Second Priority
     Floating Rate Term Notes, Due 2037; and

   * to Caa1 (from Ba3), the U.S. $7,000,000 Class C-1 Third
     Priority Floating Rate Term Notes, Due 2037 and U.S.
     $15,000,000 Class C-2 Third Priority Fixed Rate Term Notes,
     Due 2037.

Moody's indicated that both classes of notes had been under review
for downgrade at the time of its rating action.  Independence
Fixed Income LLC is the collateral manager of the transaction.
Moody's noted that this transaction, backed primarily by
structured finance securities, closed on May 9, 2002.  According
to Moody's, its rating action reflects concern over deterioration
in the credit quality, in particular in the weighted average
rating factor of the collateral pool.  Moody's noted that in the
most recent monthly report on the transaction, nearly 22% of the
collateral pool had a Moody's rating below Baa3 (10% limit) and
that the weighted average rating factor was 1008 (475 limit).

Rating Action: Downgrade

Issuer:            Independence III CDO, Ltd.

Class Description: U.S. $18,000,000 Class B Second Priority
                   Floating Rate Term Notes, Due 2037

Prior Rating:      A1 (under review for downgrade)

Current Rating:    A2

Class Description: U.S. $ 7,000,000 Class C-1 Third Priority
                   Floating Rate Term Notes, Due 2037

                   U.S. $15,000,000 Class C-2 Third Priority Fixed
                   Rate Term Notes, Due 2037

Prior Rating:      Ba3 (under review for downgrade)

Current Rating:    Caa1


INTEGRATED BUSINESS: March 31 Balance Sheet Upside-Down by $5 Mil.
------------------------------------------------------------------
Integrated Business Systems and Services, Inc. (OTCBB:IBSS)
reported its first quarter financial results for the three-month
period ended March 31, 2005.

For the three months ended March 31, 2005, IBSS reported a 29%
decline in revenues to $543,280 from $765,680 for the comparable
three-month period in the prior year.  Net loss for the first
quarter decreased to $319,296, compared to a net loss of $322,201,
reported for the three months ended March 31, 2004.

"While there was a marked decline in revenues relative to the
first quarter of last year, our net loss showed a slight recovery
indicating that the Company is making progress in its cost
containment efforts," said Michael Bernard, Chief Financial
Officer of the Company.  "IBSS continues to be challenged by the
sales cycle necessary to develop new customer relationships that
are capable of producing significant revenue generating
opportunities for IBSS.  Though we are pleased to show some bottom
line improvement, we recognize that the Company requires a
significant increase in revenues and additional capital
investments, without which we will not be able to continue to
implement our business plan."

George Mendenhall, CEO of IBSS, added, "Though we are challenged
financially, we remain riveted to our focused growth strategy to
capture a meaningful share of the explosive RFID and wireless
solutions market.  In this regard, we are continuing to make
progress in establishing the value of Synapse(TM) in RFID and
Mobile computing applications.  Synapse(TM), our proprietary
application development and implementation environment, is ideally
constructed to fully exploit the Linux operating system in
delivering real-time applications.  The compact and efficient size
of the complete Synapse(TM) software environment allows it and
Linux to fit onto devices with very small memory resources.  And
despite its small size, we believe Synapse(TM)is unparalleled in
its power for enterprise scalability and transaction handling."

Concluding, Mendenhall noted, "As the value of IBSS' RFID and
mobile solutions continue to win momentum and support among our
customers and strategic partners, some of which include: Prospect
Airport Services, Arthur Blank & Co., Ekahau, Inc. and USM
Systems, Ltd.  We look forward to making notable progress in our
effort to build enduring and enhanced value for each of our
shareholders."

                       About the Company

Headquartered in Columbia, South Carolina, Integrated Business
Systems and Services, Inc. -- http://ibss.net/-- is the creator
of Synapse(TM), a groundbreaking software technology.  Synapse(TM)
is a complete framework and methodology used to create, implement
and manage a wide variety of dynamic, distributed, networked, and
real-time enterprise applications including RFID, quickly and
efficiently.  Global enterprises utilizing Synapse(TM) leverage
the power of its single, flexible framework to enjoy tremendous
time and cost advantages, in the development, deployment and on-
going management of customized applications.

Enabled by Synapse(TM) to take competitive advantage of cutting-
edge technologies such as wireless networking, mobile computing
and RFID, IBSS and its strategic partners bring solutions to
customers for mission-critical applications in manufacturing,
distribution, healthcare, finance, insurance, retail, education,
and government.

At Mar. 31, 2005, Integrated Business Systems and Services,
Inc.'s balance sheet showed a $4,806,171 stockholders' deficit,
compared to a $4,497,585 deficit at Dec. 31, 2004.


IPIX CORP: Reports Financial Results for First Quarter 2005
-----------------------------------------------------------
IPIX Corporation (NASDAQ:IPIX), a premier supplier of 360-degree,
immersive imaging technologies, reported financial results for the
quarter ended March 31, 2005, and comparable prior year results:

   For the Three Months Ended March 31,               2005         2004
   ------------------------------------               ----         ----
                                    (in thousands, except per share data)
   Revenue                                           $  668       $  476
   Operating expenses                                $4,928       $1,986
   Loss from continuing operations                   $4,521       $1,803
   Loss from discontinued operations, net of taxes   $1,360       $1,407
   Net loss per common share, basic and diluted     ($0.27)      ($0.41)

Revenue increased 40% for the quarter ended March 31, 2005,
compared to the same period in the prior year, primarily due to
sales of 360-degree cameras from the immersive video product line.
Also of note, IPIX completed the sale of its AdMission business
unit on February 11, 2005, which is reported as discontinued
operations in 2005 and prior years.

Operating expenses increased due to sales and marketing
expenditures focused on building strong direct and channel sales
for the immersive video product line, as well as increased
marketing and trade show activities. General and administrative
expenses increased in the first quarter of 2005 as a result of
additional resources of accounting and legal consultants assisting
in the reporting of discontinued operations and Sarbanes-Oxley
compliance.

The first quarter of 2005 included the launch of IPIX's new
CommandView(TM) Day/Night Camera at the ISC-West Conference in Las
Vegas, as well as technology partnerships with VistaScape and
ObjectVideo, two leading providers of intelligent video
surveillance software.

"Our new technology and distribution partnerships, as well as the
launch of our Day/Night camera, are representative of the
significant investment we have made to meeting marketplace demand,
building sales channels, and re-establishing our core operations
and infrastructure," said IPIX President and CEO Clara Conti. "All
of these have been essential elements for achieving our business
and sales objectives."

                        About the Company

IPIX Corporation -- http://www.ipix.com/-- is a premium provider
of immersive imaging products for government and commercial
applications.  The Company combine experience, patented technology
and strategic partnerships to deliver visual intelligence
solutions worldwide.  The Company's immersive, 360-degree imaging
technology has been used to create high-resolution digital still
photography and video products for surveillance, visual
documentation and forensic analysis.

                       Going Concern Doubt

In its Form 10-K for the year ended Dec. 31, 2004, filed with the
Securities and Exchange Commission, IPIX Corporation's auditors
included a going concern opinion in the Company's financial
statements.  During the year ended December 31, 2004, and in the
prior fiscal years, the Company has experienced, and continues to
experience, certain issues related to cash flow and profitability.
These factors raise substantial doubt about the Company's ability
to continue as a going concern.  The Company believes that it can
generate sufficient cash flow to fund its operations through the
launch and sale of new products in 2005 in the two continuing
business units of the Company.  In addition, management will
monitor the Company's cash position carefully and evaluate its
future operating cash requirements with respect to its strategy,
business objectives and performance.  Management will focus on
operating costs in relation to revenue generated.


ISTAR ASSET: Fitch Lifts Ratings on 7 Class Certificates
--------------------------------------------------------
Fitch Ratings upgrades iStar Asset Receivables Trust (STARs)
Trust's commercial mortgage pass-through certificates, series
2003-1 as follows:

    -- $16.7 million class B to 'AAA' from 'AA+';
    -- $18.4 million class C to 'AAA' from 'AA';
    -- $11.7 million class D to 'AAA' from 'AA-';
    -- $13.4 million class E to 'AAA' from 'A+';
    -- $13.4 million class F to 'AA' from 'A';
    -- $11.7 million class G to 'AA-' from 'A-';
    -- $11.7 million class H to 'A+' from 'BBB+';
    -- $13.4 million class J to 'A' from 'BBB';
    -- $23.4 million class K to 'A-' from 'BBB-';
    -- $16.7 million class L to 'BBB+' from 'BB+';
    -- $13.4 million class M to 'BBB-' from 'BB';
    -- $11.7 million class N to 'BB' from 'BB-';
    -- $5.5 million class O to 'BB-' from 'B+';
    -- $7.4 million class P to 'B+' from 'B';
    -- $7.4 million class Q to 'B' from 'B-';
    -- $7.4 million class S to 'B-' from 'CCC'.

Additionally, the following classes are affirmed by Fitch:

    -- $105.5 million class A-1 at 'AAA';
    -- $225.2 million class A-2 at 'AAA'.

Fitch does not rate the $18.5 million class T.

The upgrades are the result of increased credit enhancement after
the prepayment of five loans totaling $135.3 million, or 25.1%,
combined with improved performance.

The certificates are collateralized by 28 loans on 80 properties
consisting mainly of office (59.5%).  The largest geographic
concentrations are in Virginia (20.4%) and California (19.2%).
The portfolio has limited property-type and geographic diversity,
which has been accounted for through additional stresses in the
remodeling of the mortgage pool.

The Fitch stressed weighted average debt service coverage ratio
increased to 1.50 times (x) at year end (YE) 2004 from 1.44x at
issuance.  The Fitch DSCR is calculated by using Fitch adjusted
net cash flow and a Fitch stressed debt service constant for
comparable loans.

Four loans maintain investment grade credit assessment ratings and
represent 55.8% of the pool compared to 49.4% at issuance.

Headquarters/Mission-Critical Facilities Portfolio (25.3%)
consists of eight cross-collateralized and cross-defaulted loans.
The loans range from $2.5 million to $66.4 million.  Collateral
consists of eight single-tenant office and industrial properties
subject to long term triple net leases to institutional corporate
tenants.  With the exception of the Accenture property (100%
leased but 56% vacant-44% subleased to Julian Studley), all
properties are 100% occupied with a remaining weighted average
lease term of 12 years.  Approximately 30.5% of the tenants are
investment grade.  Performance has improved with a DSCR of 1.59x
based on 9 month 2004 operations annualized, as compared to 1.48x
at issuance.

The Northrop Grumman Headquarters loan (18.5%) is secured by two
adjoining class A office Northrup Grumman, rated BBB by Fitch and
a six level parking facility.  The lease is NNN, expires on Dec.
31, 2016 and has two five-year extension options.  The loan
amortizes on a 20-year schedule.  Performance has improved with a
DSCR of 1.62x at YE 2004 compared to 1.49x at issuance.

The Accor Portfolio (9.7%) is secured by a pool of limited service
hotels, flagged as Motel Six.  The Portfolio is split into three
fully amortizing loans (I, IIA and IIB) that are neither cross
collateralized nor cross defaulted.  The properties are subject to
a long-term bondable NNN master lease to Accor SA (rated 'BBB+' by
Fitch). The loans are each split into A and B notes.  The A notes
are part of the trust and the B notes are held outside the trust
by iStar Financial.  The A notes receive all cash flow until they
are paid off, while the B notes receive nothing until the A notes
are retired.  The fast pay amortization is based on a 10 year
schedule.  The portfolio trust balance has been reduced by 32.8%
since issuance.  Performance has improved for Accor I, IIA and IIB
with DSCRs of 2.72x, 1.94x and 2.55x at YE 2004, respectively,
compared to 2.05x, 1.57x and 2.14x at issuance.

The Chelsea Property Group (2.3%) loan is an unsecured corporate
loan.  The facility maintains the investment grade credit
assessment rating assigned at issuance.

One facility has not maintained the investment grade credit
assessment rating assigned at issuance, the Royal Sun Alliance
loan (3.9%).  The loan is secured by a fee interest in an
industrial/research and development facility located in Hawthorn,
CA, approximately 15 miles southwest of the Los Angeles central
business district.  The entire facility is subject to a long term,
bondable, NNN lease to AT&T Corp. (rated 'BB+' by Fitch).  The
property is utilized as a mission critical web hosting center
serving the western region of the U.S.  Additional credit
enhancement includes a put option to Royal Indemnity Company, a
subsidiary of Royal & Sun Alliance Insurance Group, which is rated
'BB-' by Fitch.  At issuance, both AT&T and Royal & Sun were rated
'BBB+'.

The six non-credit assessed loans in the pool consist of one first
mortgage, three first mortgage senior participations, and two
mezzanine loans.


LEAP WIRELESS: Posts $6.6 Million Net Loss in Fourth Quarter
------------------------------------------------------------
Leap Wireless International, Inc. (OTCBB:LEAP) reported its
financial and operating results for the fourth quarter and full
year ending December 31, 2004, representing the combination of the
Company's results prior to and after its emergence from Chapter 11
reorganization.  The Company also provided preliminary customer
and financial results for the first quarter of 2005 and updated
its business outlook for full year 2005, incorporating proposed
new Auction #58 market build out activities.

The adoption of fresh-start reporting as of July 31, 2004,
resulted in material adjustments to the historical carrying values
of the Company's assets and liabilities.  As a result, the
Company's post-emergence balance sheet, statements of operations
and statements of cash flows are not comparable in many respects
to the Company's financial statements for periods ending prior to
the Company's emergence from Chapter 11.

Total consolidated revenues for the fourth quarter were
$206.6 million, compared to total consolidated revenues of
$188.9 million for the fourth quarter of 2003.  Consolidated
operating income for the fourth quarter was $4.9 million, compared
to a consolidated operating loss of $28.5 million for the fourth
quarter of 2003.  Consolidated net loss for the fourth quarter was
$6.6 million, compared to a consolidated net loss of
$172.8 million for the fourth quarter of 2003.

For full year 2004, combined total consolidated revenues were
$826.0 million, compared to total consolidated revenues of $751.3
million for full year 2003.  Combined consolidated operating loss
for 2004 was $30.2 million, compared to a consolidated operating
loss of $360.4 million for full year 2003.  Combined consolidated
net income for 2004 was $904.6 million, compared to a consolidated
net loss of $597.4 million for full year 2003.  Full year 2004 net
income included $962.4 million of reorganization items, net,
reflecting the net impact of fresh-start accounting and other
bankruptcy-related changes to the balance sheet.  This combined
net income result for fiscal year 2004 is not indicative of the
Company's expected future performance.

During the fourth quarter, the Company experienced an unexpected
increase on rebate redemptions of handset mail-in rebates, causing
a $5.3 million decrease in equipment and service revenues during
the quarter.  Because of changes in the Company's promotional
strategy, Leap does not expect to experience this increased level
of rebate activity in the future.  Reflecting this increased
rebate activity, adjusted consolidated earnings before interest,
taxes, depreciation and amortization (EBITDA) for the fourth
quarter of 2004 was $50.7 million, compared to adjusted
consolidated EBITDA of $47.1 million for the fourth quarter of
2003.

For full year 2004, combined adjusted consolidated EBITDA was
$222.8 million, compared to adjusted consolidated EBITDA of $130.5
million for 2003.  Adjusted consolidated EBITDA represents EBITDA
adjusted to exclude the effects of: reorganization items, net;
other income (expense), net; gains on sale of wireless licenses;
impairment of intangible assets; impairment of long-lived assets
and related charges; and stock-based compensation awards.

Key operational and financial performance measures for the fourth
quarter and full year 2004 were:

  -- Net customer additions for the quarter were approximately
     29,000, bringing total net customer additions during 2004 to
     approximately 97,000 compared to net customer decreases of
     approximately 5,000 and 39,000 during the fourth quarter and
     full year 2003, respectively.

  -- Churn for the quarter was 4.1%, bringing churn for the full
     year 2004 to 3.9%, an improvement over the churn rates of
     4.3% and 4.4% reported for the fourth quarter and full year
     2003, respectively.

  -- Average revenue per user per month (ARPU) for the fourth
     quarter, based on service revenue, was $37.29, an improvement
     of $1.01 from the ARPU of $36.28 for the fourth quarter of
     2003.  For full year 2004, ARPU was $37.28, an improvement of
     $1.03 from the ARPU of $36.25 for full year 2003.  The impact
     of higher than expected rebate activity during the fourth
     quarter of 2004 reduced ARPU by $0.52 and $0.13 for the
     fourth quarter and full year 2004, respectively, from what it
     would have been if rebate activity during the fourth quarter
     had been consistent with the Company's previous experience.

  -- Cost per gross customer addition (CPGA) was $159 for the
     fourth quarter, up from the CPGA of $136 reported for the
     fourth quarter of 2003. For full year 2004, CPGA was $142, an
     improvement from the CPGA of $158 for full year 2003.  The
     impact of higher than expected rebate activity during the
     fourth quarter of 2004 increased CPGA by $12 and $3 for the
     fourth quarter and full year 2004, respectively, from what it
     would have been if rebate activity during the fourth quarter
     had been consistent with the Company's previous experience.

  -- Non-selling cash costs per user per month (CCU) was $18.74
     for the fourth quarter, an improvement of $1.21 from the CCU
     of $19.95 for the fourth quarter of 2003.  For full year
     2004, CCU was $18.91, an improvement of $3.43 from the CCU of
     $22.34 for full year 2003.

  -- Average minutes of use per customer per month (MOU) during
     the fourth quarter were approximately 1,500.

  -- Cumulative purchases of property and equipment (capital
     expenditures) increased by $33.5 million during the fourth
     quarter of 2004, bringing cumulative capital expenditures for
     the 12 months ending December 31, 2004 to $77.2 million.

As a result of the adoption of Emerging Issues Task Force (EITF)
Issue No. 00-21, "Accounting for Revenue Arrangements with
Multiple Deliverables" on July 1, 2003, the Company began
recognizing activation fees immediately as equipment revenue,
which had the effect of reducing both ARPU and CPGA for the
periods reported after its adoption.  Because EITF Issue No. 00-21
was only in effect for six months during fiscal year 2003 compared
to 12 months for fiscal year 2004, the full year 2004 ARPU and
CPGA reported above are not directly comparable with full year
2003 ARPU and CPGA.

"The fourth quarter completed a year of significant development
for our business as we grew our customer base and delivered strong
year-over-year improvements in our financial performance," said
Doug Hutcheson, president and chief executive officer of Leap.
"We added more customers, reduced churn and significantly improved
our operational metrics compared to the previous year.  For the
full year 2004, our adjusted consolidated EBITDA was up 71% over
the previous year.  Even though performance of our overall
business was masked by higher than planned rebate activity, which
we do not expect to experience in the future, the Company nearly
achieved its full year adjusted EBITDA guidance.  We believe that
the new products and services we are introducing in the first half
of this year, combined with our new, brand-centric marketing
strategy, will provide momentum for further growth in the coming
quarters."

       Preliminary Results for the First Quarter of 2005

In addition to its results for the fiscal year 2004, Leap also
gained nearly 46,000 net customers during the first quarter of
2005 and that customer churn for the first quarter was 3.3
percent.  Based on preliminary results, the Company also announced
that, for the first quarter of 2005, it anticipates total
consolidated revenue to be in the range of $223 million to $228
million, consolidated operating income, excluding stock-based
compensation expenses, to be in the range of $19 million to $24
million, and ARPU to be in the range of $38.25 to $39.25.

The Company cautions that these financial results are preliminary,
based on currently available information and are subject to the
final quarterly closing process and the completion of customary
quarterly review procedures by the Company's management, the Audit
Committee of Leap's board of directors, and the Company's
independent registered public accounting firm.

"As indicated by preliminary results we are providing today for
the first quarter, the Company has entered 2005 with solid
financial performance upon which to build the future of our
business," continued Mr. Hutcheson.  "In 2005, we expect to
continue to execute in our markets, evolve our Cricket service to
meet the needs of our customers and, as our new product
initiatives gain traction in the marketplace, generate top-line
growth on a cost-effective basis.  We believe that significant
opportunities for growth remain in the markets we serve and we
continue to be focused on leveraging our differentiated product
and operational expertise to help realize the full potential of
our business."

                     Financial Restatements

On May 9, 2005, Leap disclosed that Company management and the
Audit Committee of Leap's Board of Directors had concluded that
the Company's financial results for the three months ended
September 30, 2004, should be restated to correct for errors and
that the unaudited interim consolidated financial statements
included in the Quarterly Report on Form 10-Q for the third
quarter of 2004 should no longer be relied upon.  Accordingly, the
Company intends to file an amended Quarterly Report on Form 10-Q
as soon as practicable.  The Company's management and Audit
Committee discussed the restatement with the Company's independent
registered public accounting firm.

The expected effect on net income of the adjustments required to
correct these errors for the Company's combined results for the
third quarter fiscal 2004 (representing the results for the one
month ended July 31, 2004 combined with the results for the two
months ended September 30, 2004), is to increase combined
consolidated net income by $5.5 million for the three months ended
September 30, 2004, resulting in net income of $957.4 million for
such period.  The adjustments described above result from the
correction of accounting errors and are not attributable to any
misconduct by Company employees.

                          Recent Events

In 2005, Leap has continued to execute on its product development
initiatives with the launch of Jump(TM) by Cricket(R) prepaid
service; the expansion of its long distance offering to more than
70 countries; the completion of the network upgrades required to
support its BREW(R)-based data service, Cricket Clicks(TM); the
launch of unlimited multimedia services, AOL(R) Instant Messaging
and international text messaging to Mexico; the introduction of a
simplified rate plan structure and Travel Time(TM) away-from-home
calling for its Cricket service; and the launch of a new
advertising and branding campaign.  In addition, the Company
introduced redesigned Cricket retail locations that improve the
sales process and reinforce the differentiation and core value
attributes of Cricket's unlimited service.

"As evidenced by our recent announcements, the process of
strengthening our business through the development and
introduction of new, customer-driven products and services has
moved ahead well," said Al Moschner, executive vice president and
chief marketing officer of Leap.  "We have never been in the
business of providing service offerings that require customers to
count minutes or decipher complex calling plans or bills.
Instead, we have maintained a fundamental focus on providing value
to our customers with unlimited services and predictable prices.
We believe that the new marketing and advertising strategies we
are implementing, together with the launch of our new products,
will reinforce the key differentiation of our core message:
unlimited services.  We intend to clearly communicate this message
to consumers while providing significant support to the Cricket
brand in the marketplace.  Over time, we expect the new
initiatives that we are undertaking will drive the profitable
growth of our business."

Since the beginning of 2005, the Company has taken seven
significant steps to strengthen its financial position and develop
the depth and breadth of its management and board of directors:

  -- The successful syndication and closing of $610 million in
     senior secured credit facilities consisting of a six-year
     $500 million term loan and an undrawn five-year, $110 million
     revolving credit facility, lowering the Company's cost of
     capital and future expected interest expense;

  -- Execution of a definitive agreement to sell certain spectrum
     licenses and operating assets for approximately $102 million
     in cash;

  -- Execution of a definitive agreement to sell approximately 140
     cell towers and related assets for approximately $18 million
     in cash;

  -- The Company's winning bids, and the winning bids of a
     subsidiary of Alaska Native Broadband 1, LLC ("ANB-1"), in
     Auction #58, which support the Company's strategy of
     developing market clusters to more effectively serve
     customers.  The two members of ANB-1 are Alaska Native
     Broadband, LLC, which is the controlling entity and sole
     manager of ANB-1, and Leap's wholly-owned subsidiary, Cricket
     Communications, Inc., which has a 75 percent, non-controlling
     interest in this entity;

  -- Appointment of Albin Moschner in January 2005 as executive
     vice president and chief marketing officer, a new executive-
     level position at the Company;

  -- Appointment of Doug Hutcheson, one of the chief architects of
     the Cricket business plan, in February 2005 as president and
     chief executive officer; and

  -- Appointment of business veterans John D. Harkey, Jr. and
     Robert V. LaPenta to Leap's Board of Directors in March 2005,
     bringing additional industry and financial experience to the
     Board.

"A significant component of our overall growth strategy is the
disciplined, cost-effective expansion of the business," commented
Glenn Umetsu, executive vice president and chief technical officer
for Leap.  "For instance, our Fresno network deployment remains on
track for low build-out costs, and we expect that the other new
markets the Company plans to launch will have similar costs. In
addition, the markets for which we were the winning bidder in
Auction #58 are very attractive for our business.  As we move
ahead with our planning for the development and launch of our new
markets, we intend to remain focused on maximizing the return on
our investments.  We are extremely excited to have the opportunity
to expand our service into these new, potentially high-value
markets which were selected based on specific factors that are
characteristic of our best performing markets."

                     Business Outlook

Leap provided an updated outlook for fiscal year 2005.  The
Company's current outlook for fiscal year 2005 is for:

   -- Total net customer additions to be between 150,000 and
      200,000;

   -- Annual churn to be between 3.5 percent and 4.0 percent;

   -- Total consolidated revenue to be between $890 million and
      $950 million, revised from $875 to $950 million;

   -- Adjusted consolidated EBITDA to be between $245 million and
      $270 million including costs associated with new market
      development activities, revised from $235 to $270 million;
      and

   -- Capital expenditures to be between $175 million and $230
      million for fiscal year 2005, revised from $110 to $120
      million.  Capital expenditures during 2005 include an
      expected $20 million to $25 million of capital expenditures
      associated with the build-out and launch of the Fresno,
      Calif. market and the related expansion and network change-
      out of the Company's existing Visalia and Modesto/Merced
      markets, and costs associated with the initial development
      of markets covered by licenses expected to be acquired as a
      result of Auction #58 (including expected capital
      expenditures incurred by ANB-1 with respect to its expected
      new markets to the extent the Company consolidates such
      expenditures for reporting purposes).

"We have made significant improvements in our balance sheet over
the past few months," said Dean Luvisa acting chief financial
officer for Leap.  "The successful syndication of $610 million of
senior secured credit facilities reduced our interest expense and
gave us a strong endorsement from the credit markets.  We have
also taken steps to ensure our assets more closely match our
future market and operating strategy through agreements to sell
our tower assets and certain spectrum licenses and operating
assets, and through our winning bids on new, high-value markets in
Auction #58.

"As we move forward, we intend to maintain a strict focus on
operational basics," continued Mr. Luvisa.  "We expect to control
and reduce costs where possible by continuously improving our
processes.  We also intend to maintain a disciplined approach to
managing our balance sheet.  Meeting these challenges will put us
at the forefront in an industry where a low cost structure and a
strong balance sheet are significant competitive advantages."

Mr. Hutcheson commented, "To summarize the actions that will allow
us to deliver results that match our 2005 guidance, I would point
to three areas. First, continued development of new, customer-
driven products and services that contribute to the growth of our
business and improvement of our operating margins.  Second,
financially disciplined expansion focused on the development of
new markets that we believe will provide us with the best
opportunity for delivering high customer value and a high return
on our investments.  And finally, an internal focus on maintaining
our cost leadership position within the industry and ensuring Leap
remains financially strong for our stockholders with a prosperous
and secure future for its employees and other stakeholders."

                           About Leap

Leap Wireless -- http://www.leapwireless.com/-- headquartered in
San Diego, Calif., is a customer-focused company providing
innovative mobile wireless services that are targeted to meet the
needs of customers who are under-served by traditional
communications companies.  With a commitment to predictability,
simplicity and value as the foundation of our business, Leap
pioneered Cricket service, a simple and affordable wireless
alternative to traditional landline service.  Cricket service
offers customers unlimited anytime minutes within the Cricket
calling area over a high-quality, all-digital CDMA network.
Cricket service is available to customers in 39 markets in 20
states stretching from New York to California.

                         *     *     *

As reported in the Troubled Company Reporter on Apr. 7, 2005,
Standard & Poor's Ratings Services placed its ratings for San
Diego, California-based wireless carrier Leap Wireless
International Inc., including the 'B-' corporate credit rating, on
CreditWatch with negative implications.  This follows the
company's failure to file its 2004 10-K by its March 31 deadline.

Leap indicated in an SEC filing on April 1 that it has been
delayed in filing its 10-K due to its review of its lease
accounting practices.  This review was prompted by the SEC staff
guidelines to the American Institute of Certified Public
Accountants in a Feb. 7 letter, which have caused many public
companies to restate prior-period financials and accelerate
certain lease Failure to file its annual statements by March 31
constitutes a breach of the terms of Leap's secured bank facility.

If the company does not file its annual financial statements by
April 15, this would constitute an event of default under the bank
facility.  Leap has indicated that it expects to file with the SEC
by April 15.  If the company does not file its financial
statements by then, or is unable to obtain bank facility waivers,
the ratings could be lowered.


LORAL SPACE: March 31 Balance Sheet Upside-Down by $1.07 Billion
----------------------------------------------------------------
Loral Space & Communications (OTC Bulletin Board: LRLSQ) filed its
Form 10-Q for the quarterly period ended March 31, 2005, with the
Securities and Exchange Commission.

Loral reported a $26.2 million net loss for the three months ended
March 31, 2005, compared to a $79.6 million net loss for the same
period last year.

At March 31, 2005, Loral Space's balance sheet showed a
$1.07 billion stockholders' deficit, compared to a $1.04 billion
deficit at Dec. 31, 2004.

A full-text copy of Loral Space's quarterly report is available at
no charge at:


http://www.sec.gov/Archives/edgar/data/1006269/000095012305005922/y08776e10vq.htm

As reported in the Troubled Company Reporter on March 23, 2005,
Loral Space & Communications Ltd. delivered revised plan of
reorganization to the U.S. Bankruptcy Court for the Southern
District of New York that reflects an agreement among the company,
the Creditors' Committee and the Ad-Hoc Committee of Space
Systems/Loral trade creditors on the elements of a consensual plan
of reorganization.  That plan proposes that Loral Orion unsecured
creditors will receive approximately 80% of New Loral common
stock, $200 million of preferred stock to be issued by New Skynet,
and the right to subscribe to purchase their pro-rata share of
$120 million in new senior secured notes of New Skynet.  Loral
bondholders and certain other unsecured creditors are offered
approximately 20% of the common stock of New Loral.  Nothing is
delivered under the proposed plan to Loral's existing common and
preferred stockholders.  The Plan is subject to final
documentation and confirmation by the U.S. Bankruptcy Court.
Copies of the revised consensual Plan are available at no charge
on Loral's Web site at http://www.loral.com/

                        About Loral Space

Loral Space & Communications is a satellite communications
company.  It owns and operates a fleet of telecommunications
satellites used to broadcast video entertainment programming,
distribute broadband data, and provide access to Internet services
and other value-added communications services.  Loral also is a
world-class leader in the design and manufacture of satellites and
satellite systems for commercial and government applications
including direct-to-home television, broadband communications,
wireless telephony, weather monitoring and air traffic management.

The Company and various affiliates filed for chapter 11 protection
(Bankr. S.D.N.Y. Case No. 03-41710) on July 15, 2003.  Stephen
Karotkin, Esq., and Lori R. Fife, Esq., at Weil, Gotshal & Manges
LLP, represent the Debtors in their restructuring efforts.  When
the company filed for bankruptcy, it listed total assets of
$2,654,000,000 and total debts of $3,061,000,000.


MAXXAM INC: Lumber Units' Bankruptcy Imminent as Losses Continue
----------------------------------------------------------------
MAXXAM Inc. (AMEX:MXM) reported a $14.2 million net loss for the
first quarter of 2005, compared to a net loss of $20.3 million for
the same period a year ago.  Net sales for the first quarter of
2005 totaled $83.0 million, compared to $68.9 million in the first
quarter of 2004.

MAXXAM reported operating income of $2.8 million for the first
quarter of 2005, compared to an operating loss of $6.6 million for
the comparable period in 2004.  This improvement in operating
income is largely due to the increased sales activity and the
receipt and recognition of deferred profits at the Company's real
estate operations.  Additionally, in March 2005, the Company's
forest products operations reached a $3.1 million settlement of a
lawsuit filed against several insurance companies for
reimbursement of settlement payments and defense costs related to
a legal matter that was concluded in 2002.

                   Forest Products Operations

Net sales for forest products operations increased $3.9 million
to $47.3 million for the first quarter of 2005, as compared to
$43.4 million the same period in 2004.  Shipments of Douglas-fir
lumber inventories more than doubled, as compared to the same
period in 2004, resulting in an increase in net sales of
$6.6 million during the quarter.  This increase was offset by
lower shipments of redwood lumber of $2.8 million.

Although sales improved, the operating loss increased to
$2.8 million for the first quarter of 2005, compared to an
operating loss of $0.3 million the same period a year ago,
principally due to increased logging, hauling and production
costs, partially offset by the $3.1 million insurance settlement
reached in the first quarter of 2005.

                    Real Estate Operations

Real estate sales more than doubled in the first quarter of 2005
over the prior year period, resulting in an increase in net sales
of $11.8 million.  This increase was principally due to increased
sales activity at the Company's Fountain Hills and Mirada
developments and the receipt and recognition of deferred profits
at the Company's Palmas development.

Operating income improved to $6.7 million for the first quarter of
2005, as compared to an operating loss of $1.8 million the same
period in 2004, principally due to the increase in net sales.

                      Racing Operations

Net sales and operating income for the Company's racing operations
declined $1.6 million and $0.8 million, respectively, for the
first quarter of 2005, as compared to the same period in 2004,
primarily due to lower average daily attendance and reduced
simulcast wagering.

                          Corporate

The Corporate segment's operating results improved from a loss of
$5.1 million in the first quarter of 2004 to a loss of $0.9
million in the first quarter of 2005, primarily due to a $1.6
million benefit recognized in the first quarter of 2005 related to
changes in stock-based compensation expense, which is adjusted as
the market value of the Company's common stock changes. In the
first quarter of 2004, expense of $2.2 million was recognized
related to changes in stock-based compensation expense.

       Lumber Units' Liquidity Woes and Pending Bankruptcy

MAXXAM filed its quarterly report on Form 10-Q with the Securities
and Exchange Commission. The Condensed Notes to Financial
Statements and other sections of the Form 10-Q discuss how the
cash flows of The Pacific Lumber Company and Scotia Pacific
Company LLC, indirect subsidiaries of MAXXAM, have been materially
adversely affected by the ongoing regulatory, environmental and
litigation matters faced by Palco and Scotia LLC.

At March 31, 2005, Palco continued to be in default under its
credit agreement and its liquidity crisis continued.  Previously
granted waivers of default were subsequently extended through
April 22, 2005.  On April 19, 2005, Palco closed a five-year
$30 million secured, asset-based revolving credit facility and a
five-year $35 million secured term loan.  The term loan was
fully funded on April 19, 2005 and Palco used approximately
$10.8 million of the funds from the term loan to pay off amounts
outstanding under its credit agreement and terminated that
facility.  As of April 30, 2005, no borrowings had been made under
the new revolving credit facility.  Palco estimates that its cash
flows from operations will not provide sufficient liquidity to
fund its operations until the fourth quarter of 2006.
Accordingly, Palco expects to be dependent on the funds available
under the new term loan and new revolving credit facility to fund
its working capital requirements in 2005 and 2006.

As previously announced, Scotia LLC estimates that its cash flows
from operations, together with funds available under its line of
credit, will be inadequate to pay all of the interest due on the
July 20, 2005, payment date for Scotia LLC's Timber Notes, which
would be an event of default under the indenture governing the
Timber Notes.  Scotia LLC is seeking to restructure its
obligations with respect to the outstanding Timber Notes; however,
there can be no assurance that Scotia LLC will be successful in
its efforts to restructure these obligations.

In the event of a Scotia LLC default under the indenture governing
the Timber Notes or a future Palco liquidity shortfall, Palco and
Scotia LLC could be forced to take extraordinary actions, which
may include:

   * reducing expenditures by laying off employees and shutting
     down various activities;

   * seeking other sources of liquidity, such as from asset sales;
     and

   * seeking protection by filing under the U.S. Bankruptcy Code.

                          Other Matters

As previously announced in prior earnings statements, MAXXAM may
from time to time purchase shares of its common stock on national
exchanges or in privately negotiated transactions.

MAXXAM Inc. (AMEX:MXM) is engaged in a wide range of businesses
from aluminum and timber products to real estate and horse racing.
The Company's timber subsidiary, Pacific Lumber, owns about
205,000 acres of old-growth redwood and Douglas fir timberlands in
Humboldt County, California.  MAXXAM's real estate interests
include commercial and residential properties in Arizona,
California, and Texas, and Puerto Rico.  The company also owns the
Sam Houston Race Park, a horseracing track near Houston.


MEDCOMSOFT INC: $6 Mil. Equity Infusion Turnarounds Balance Sheet
-----------------------------------------------------------------
MedcomSoft Inc. (TSX - MSF) disclosed its financial and operating
results for its third fiscal quarter ended March 31, 2005.

            Third Quarter Activities Highlights

During the third quarter of fiscal 2005, MedcomSoft:

   -- completed a Rights Offering and private placement equity
      financings raising net proceeds of approximately $6 million
      in order to:

        (i) fund expenses associated with the execution of the
            Company's business plan related to increased sales and
            marketing activities in the United States and with the
            further development of complementary products targeted
            to the United States marketplace,

       (ii) fund increased operating expenses related to the
            improvement of implementation and support services and
            administration, and

      (iii) provide the Company a sufficient reserve of working
            capital;

   -- continued to refine its implementation process for customer
      installations and in that regard entered into a Memorandum
      of Understanding with PMV Technologies of Troy, Michigan to
      enhance deployment and technical support capabilities of its
      Medical Office Automation Software platform on a national
      basis;

   -- unveiled MedcomSoft Clinical Data Repository (MCDR) which
      will be capable of aggregating, in a completely unmanned
      fashion, the incremental pieces of a health record as they
      are generated.   This technology, which is subject to a
      provisional patent, will allow advanced data mining based on
      any combination of clinical data entries including symptoms,
      medical history, examinations, test results, conditions,
      therapies and outcomes;

   -- formed a Medical Advisory Board in order to assist
      management of the Company on industry issues, marketing
      developments, product development suggestions and industry
      developments; and

   -- appointed Paul Davis as Executive Vice President in order to
      further strengthen the Company's strategic planning
      initiatives.

                  Summary of Financial Results

Revenues for the third quarter of fiscal 2005 increased by
$29,240, or 20%, to $174,213 from $144,973 for the third quarter
last year, reflecting higher license sales and higher maintenance
revenues from a larger customer install base.  The increase is
attributed primarily to greater US revenues, of $33,993 or 35%,
which were partially offset by reduced Canadian revenues, of
$4,753 or 10%.

The Company remains optimistic as the increased sales and
marketing activities in the United States of MedcomSoft and its
distribution channel partners have resulted in the generation of
an unprecedented number of qualified sales opportunities.  In
addition, the Company continues to refine its marketing strategy
to allow for the execution of significantly more sales and to take
into account what appears to be a longer than anticipated sales
cycle in the ambulatory care market (3 - 12 months based on the
size of the opportunity).  The funnel of sales opportunities
reported by the Company's distribution channel partners continues
to increase and therefore management expects that actual sales in
the fourth quarter of MedcomSoft Record will surpass previously
achieved results.  Notwithstanding the expected increase in sales,
it is possible that the Company will not be cash flow positive
during the fourth quarter as previously anticipated. It is
important to note, however, that the Company is currently pursuing
numerous exciting prospects and management remains confident in
the market acceptance of MedcomSoft Record 2.0 and in this product
achieving successful market penetration in the Unites States.

For the third quarter of fiscal 2005, the gross profit increased
by $15,392 to $152,466 from $137,074 for the third quarter of
fiscal 2004.  Gross margins declined to 88% in the third quarter
of fiscal 2005 from 95% in the comparable period due to a royalty
cost incurred for an imbedded license, which was recorded in the
third quarter of fiscal 2005.  The extent of the amount of this
expense is not expected to recur or negatively impact future
quarters.  The company expects gross margins will remain at or
near 94% in the short term.

Overall expenses for the third quarter of fiscal 2005 increased by
$307,939 or by 49% to $934,967 from $627,028 in the third quarter
of fiscal 2004.

The largest portion of the third quarter increase in expenses was
from the increase in the Company's sales and marketing activities,
of $152,937 or 113%, from $135,222 in the third quarter of the
previous fiscal year to $288,159 in the third quarter of fiscal
2005.  This increase is due to the aggressive promotion of the new
product (MedcomSoft Record 2.0) released in the latter part of the
first quarter of fiscal 2005, which management believes holds an
exceptional competitive position in the market today.
Accordingly, the Company has intensified its promotion and market
education efforts in order to ensure that the Company increases
its share of the U.S. healthcare information market that has been
recently sensitized to the adoption of Electronic Health Records
and integrated clinical automation solutions.

Research and development expenses in the third quarter of fiscal
2005 were $231,954 compared to the third quarter of the previous
fiscal year, of $167,014, for an increase of $64,940 or 39%. The
increase is wholly attributable to the hiring of staff and use of
consulting resources in order to continue the development of
existing products and to start development of additional
complementary products.

General and administrative expenses increased by $56,429 or 19% to
$351,088 from $294,659 in the third quarter of fiscal 2004, mainly
due to the hiring of additional staff during the third quarter of
the current year.

Loss from operations in the third quarter was $782,501 compared to
a loss from operations of $489,954 in the third quarter of last
year.  Further, during the third quarter of fiscal 2005, the
Company recorded, as a reduction of expenses, $19,078 relating to
certain expenses that had previously been accrued by the Company,
which are no longer expected to be paid pursuant to a settlement
with a vendor, compared to nil in the third quarter of the prior
year.

The Company incurred a net loss after tax in the third quarter of
$751,386 or a loss of $0.02 per common share, compared to a net
loss after tax of $489,311 or $0.01 per share for the third
quarter of last year.

At March 31, 2005, cash was $5,275,142 compared to $565,785 as at
December 31, 2004, and $197,630 at the June 30, 2004, year-end.
During the third quarter, the Company generated $5,693,752 in net
financing activities pursuant to the completion of a Rights
Offering and private placement equity financings.  The Company
also invested modest amounts in capital assets and had net
operating outflows of $967,367 in the third quarter.

Overall current assets increased significantly to over
$5.5 million as at March 31, 2005, compared to $301,063 at the
year-end and current liabilities, excluding the convertible
debentures, were reduced by 8% to $1,612,551 as at March 31, 2005,
compared to $1,759,244 at the year-end.  The entire decrease in
the carrying value of convertible debentures as at March 31, 2005
compared to year-end reflects the conversions of debenture units
into common shares since year-end; 300 debenture units were
converted into 150,000 common shares in the second quarter and
1,200 debenture units were converted into 600,000 common shares in
the third quarter.

                           Priorities

The Company intends to increase its market presence in the
healthcare efficiency industry with a continued focus in the
United States.  The Company continues to believe that focusing its
sales and marketing efforts in the United States will result in
the best possible growth opportunity for the Company.

The Company's priorities are:

   -- translating successful customer site implementations into
      reference sites;

   -- aggressively growing its VAR distribution channel in the
      United States to achieve wider customer access;

   -- enhancing strategic alliances and relationships which
      promote the MedcomSoft Record brand and provide continued
      enhancement of the Company's core products offerings;

   -- pursuing partnerships that can promote the Company's core
      business by adding unique functionality to its products;

   -- re-achieving and maintaining profitability; and

   -- ensuring that the Company remains at the technological
      forefront of the healthcare industry.

MedcomSoft, Inc., designs, develops and markets cutting-edge
software solutions to the healthcare industry.  MedcomSoft has
pioneered the use of codified point of care medical terminologies
and intelligent pen-based data capture systems to create a new
generation of electronic medical records -- EMR.  As a result of
MedcomSoft innovations, physicians and managed care organizations
can now securely build and exchange complete, structured and
homogeneous electronic patient records.  MedcomSoft applications
are written with the latest Microsoft tools to run on the Windows
platform (Windows 2000 & XP), operate with MS SQL Server 2000(TM),
support MS Terminal Server and fully integrate with MS Office
2003, Exchange and Outlook(R).  MedcomSoft applications are fully
compatible with Tablet PCs and wireless technology.

Shareholders' equity was $4,058,537 as at March 31, 2005, and the
capital deficiency of $1,436,072 at the year-end was eliminated
mainly due to the completion of the Rights Offering and private
placement equity financings for net proceeds of $6 million in the
third quarter.


MERIDIAN AUTOMOTIVE: U.S. Trustee Appoints 7-Member Committee
-------------------------------------------------------------
Pursuant to Section 1102(a)(1) of the Bankruptcy Code, the United
States Trustee for Region 3, Kelly Beaudin Stapleton, appointed
seven creditors to serve on the Official Committee of Unsecured
Creditors in Meridian Automotive Systems, Inc., and its debtor-
affiliates' Chapter 11 cases.

The Creditors Committee consists of:

     1.  Metropolitan Life Insurance Company
         Attn: Claudia A. Cromie
         10 Park Avenue
         Morristown, NJ 07962
         Tel: (973) 355-4293
         Fax: (973) 355-4780

     2.  Caisse de depot et placement du Quebec
         Attn: Luc Houle
         1000 Place Jean-Paul-Riopelle
         Montreal, Quebec H2Z 2B3
         Tel: (514) 847-2447
         Fax: (514) 281-5884

     3.  International Union, UAW
         Attn: Niraj Ganatra, Esq.
         8000 East Jefferson Avenue
         Detroit, MI 48214
         Tel: (313) 926-5216
         Fax: (313) 926-5240

     4.  Bose Corporation
         Attn: Claudia McKellick
         The Mountain
         Framingham, MA 01701
         Tel: (508) 766-7782
         Fax: (508) 518-7782

     5.  Ridgeview Industries, Inc.
         Attn: Thomas J. Robbins
         3093 Northridge Drive NW
         Grand Rapids, MI 49544
         Tel: (616) 453-8636
         Fax: (616) 453-3651

     6.  Saint-Gobain Vetrotex America, Inc.
         Attn: Thomas L. Fitzpatrick, Esq.
         750 East Swedesford Road
         Valley Forge, PA 19482
         Tel: (508) 795-5409
         Fax: (508) 795-5266

     7.  Delphi Corporation
         Attn: Matthew K. Paroly
         5725 Delphi Drive
         Troy, MI 48098
         Tel: (248) 813-3366
         Fax: (248) 813-3445

Headquartered in Dearborn, Mich., Meridian Automotive Systems,
Inc. -- http://www.meridianautosystems.com/-- supplies
technologically advanced front and rear end modules, lighting,
exterior composites, console modules, instrument panels and other
interior systems to automobile and truck manufacturers.  Meridian
operates 22 plants in the United States, Canada and Mexico,
supplying Original Equipment Manufacturers and major Tier One
parts suppliers.  The Company and its debtor-affiliates filed
for chapter 11 protection on April 26, 2005 (Bankr. D. Del. Case
Nos. 05-11168 through 05-11176).  James F. Conlan, Esq., Larry J.
Nyhan, Esq., Paul S. Caruso, Esq., and Bojan Guzina, Esq., at
Sidley Austin Brown & Wood LLP, and Robert S. Brady, Esq., Edmon
L. Morton, Esq., Edward J. Kosmowski, Esq., and Ian S. Fredericks,
Esq., at Young Conaway Stargatt & Taylor, LLP, represent the
Debtors in their restructuring efforts.  When the Debtors filed
for protection from their creditors, they listed $530 million in
total assets and approximately $815 million in total liabilities.
(Meridian Bankruptcy News, Issue No. 4; Bankruptcy Creditors'
Service, Inc., 215/945-7000).


MERIDIAN AUTOMOTIVE: Freightliner Argues Tooling Can't be Pledged
-----------------------------------------------------------------
As previously reported in the Troubled Company Reporter on
April 29, 2005, Meridian Automotive Systems, Inc., and its debtor-
affiliates sought and obtained authority from the Honorable Judge
Walrath of the U.S. Bankruptcy Court for the District of Delaware
to obtain up to $30,000,000 in secured postpetition financing from
J.P. Morgan Securities, Inc., as interim cash collateral.

                       Priority and Liens

The Debtors also ask the Court to grant all direct borrowings and
reimbursement obligations under Letters of Credit and other
obligations under the DIP Facility joint and several
superpriority claim status in their Chapter 11 cases.  The
Debtors propose to secure their DIP Obligations by:

    -- a perfected first priority lien on all property of the
       Borrower and the Guarantors' estates that is not subject
       to valid, perfected and non-avoidable liens;

    -- a perfected junior lien on all properly of the Borrower
       and the Guarantors' estates that is subject to valid,
       perfected and non-avoidable liens in existence on the
       Petition Date other than liens held by the First Lien
       Agent, the Second Lien Agent and the Third Lien Agent; and

    -- a perfected first priority, senior priming lien on all of
       the property of the Borrower and the Guarantors' estates
       that is subject to the liens held by the First Lien Agent,
       the Second Lien Agent and the Third Lien Agent.  The
       senior priming lien will also prime any liens granted to
       provide adequate protection in respect of any of the
       Primed Liens.

                      Freightliner Objects

Freightliner, LLC, provides tooling to the Debtors pursuant to
various purchase orders, for the production of Component Parts
for Freightliner, which the Debtors use in connection with the
operation of their businesses.

Freightliner objects to the Debtors' request to incur
postpetition financing to the extent it appears, seeks or
purports to include the Tooling among the Collateral to be
pledged as security for the DIP Facility.

Freightliner argues that it owns the Tooling, and therefore, the
Tooling does not constitute property of any of the Debtors'
bankruptcy estates under Section 541 of the Bankruptcy Code.
Accordingly, the Debtors may not pledge any of the Tooling as
security for the DIP Facility.

Nevertheless, Freightliner observes that the extremely broad
language in the DIP Financing Motion describing and defining the
Collateral could be construed as an attempt by the Debtors to
include the Tooling among the Collateral to be pledged as
security to JPMorgan in connection with the DIP Facility.

Freightliner wants any order granting the DIP Financing Agreement
to expressly carve out from the Collateral the Tooling and all of
Freightliner's rights, claims and interests in the Tooling.

Headquartered in Dearborn, Mich., Meridian Automotive Systems,
Inc. -- http://www.meridianautosystems.com/-- supplies
technologically advanced front and rear end modules, lighting,
exterior composites, console modules, instrument panels and other
interior systems to automobile and truck manufacturers.  Meridian
operates 22 plants in the United States, Canada and Mexico,
supplying Original Equipment Manufacturers and major Tier One
parts suppliers.  The Company and its debtor-affiliates filed
for chapter 11 protection on April 26, 2005 (Bankr. D. Del. Case
Nos. 05-11168 through 05-11176).  James F. Conlan, Esq., Larry J.
Nyhan, Esq., Paul S. Caruso, Esq., and Bojan Guzina, Esq., at
Sidley Austin Brown & Wood LLP, and Robert S. Brady, Esq., Edmon
L. Morton, Esq., Edward J. Kosmowski, Esq., and Ian S. Fredericks,
Esq., at Young Conaway Stargatt & Taylor, LLP, represent the
Debtors in their restructuring efforts.  When the Debtors filed
for protection from their creditors, they listed $530 million in
total assets and approximately $815 million in total liabilities.
(Meridian Bankruptcy News, Issue No. 4; Bankruptcy Creditors'
Service, Inc., 215/945-7000).


MICROTEC ENTERPRISES: Quebec Superior Court Sanctions CCAA Plan
---------------------------------------------------------------
The Superior Court of the Province of Quebec yesterday sanctioned
Les Entreprises Microtec inc (TSX:EMI) and its affilates' plan of
compromise and arrangement with respect to the proceedings
undertaken pursuant to the Companies' Creditors Arrangement Act.
The CCAA Plan was filed on filed on April 25, 2005.  The company's
creditors approved the CCAA Plan on May 11, 2005.

The acceptance of this plan permits Microtec to begin the last
steps of its recapitalisation plan.  The Superior Court also
summoned a meeting of the shareholders of Microtec to be held on
June 16, 2005, to consider and vote on an arrangement proposed by
Microtec pursuant to the Quebec Companies' Act in order to convert
each Microtec share into a Microtec share exchangeable for
0,2501202 units of the Fund.  The exchange ratio has been
established based on a Fund unit value of $2.50.  An information
circular to that effect will be sent to the shareholders.

Solidly established in Canada, Microtec Enterprises Inc. provides
a wide range of security and home automation services that ensure
the protection and well-being of its residential and commercial
customers.  The Company is building on its strong position in the
industry by developing new products and services, expanding its
subscriber base, and creating strategic alliances.


MIRANT CORP: Earns $11 Million of Net Income in First Quarter
-------------------------------------------------------------
Mirant Corporation filed its quarterly report pursuant to section
13 or 15(d) of the securities exchange act of 1934 for the
quarterly period ended March 31, 2005, to the Securities and
Exchange Commission on May 10, 2005.

According to Mirant's management, the key drivers of Mirant's
first quarter 2005 performance are the expiration of the
transition power agreements, a narrowing of the spark spread and
unrealized losses on energy contracts being used to hedge gross
margin for future periods.

The Company's cash flow from operations significantly improved in
the first quarter of 2005 compared to the first quarter of 2004.
The Company's cash flow provided by operations is $104 million for
the first quarter of 2005 compared to cash used in operations of
$44 million for the first quarter of 2004.  The primary reason for
improved cash flow from operations is the expiration of the
transition power agreements (TPAs) in June 2004 and January 2005.
Cash flow from operations also reflects a decrease in working
capital used in the three months ended March 31, 2005 compared to
the same period in 2004.

The Company's gross margin is $56 million lower for the first
quarter of 2005 compared to the first quarter of 2004.  Lower
realized TPA losses increased gross margin by $133 million, which
is partially offset by lower TPA amortization of $105 million.
Excluding the impact from the TPAs, our gross margin is
$84 million lower in 2005 compared to the same period in 2004.
This decline in gross margin primarily relates to a $39 million
decline in realized gross margin resulting from lower generation
volumes and narrower spark spreads in our North American
operations and a $45 million decrease in unrealized gross margin,
resulting primarily from lower unrealized gains on power purchase
agreements (PPAs) in 2005.  This decrease in North America is
partially offset by a $7 million increase in gross margin for our
International operations, largely due to rate increases for our
Jamaica operations and Philippine energy supply business.

                     Financial Performance

The Company reported operating income of $90 million for the three
months ended March 31, 2005 compared to operating income of $140
million for the same period in 2004.

Gross Margin

The Company's gross margin decreased by $63 million for the three
months ended March 31, 2005 compared to the same period for 2004
primarily due to:

   (1) Mid-Atlantic operations gross margin decreased $55 million
       primarily due to:

       -- a decrease of $22 million due to lower generation
          volumes.  This decrease in generation volumes is
          primarily due to a narrowing of the spark spread.  The
          increase in spot market prices for coal and oil exceeded
          the increases in spot market prices for electricity;

       -- a decrease of $25 million related to losses on realized
          power hedges, partially offset by an increase of $15
          million resulting from higher settlement prices received
          on energy sold in the spot market;

       -- a decrease of $6 million resulting from increased
          emissions expense, primarily due to higher prices for
          SO2 emissions allowances;

       -- a decrease of $9 million related to higher unit prices
          for fuel;

       -- an increase of $12 million due to a net settlement with
          a coal supplier related to rail car transportation
          schedule issues that resulted in lower fuel expense;

       -- an increase of $9 million due to higher prices for
          capacity and ancillary services;

       -- a decrease of $27 million related to higher unrealized
          losses from derivative instruments of $56 million in
          2005 compared to $29 million in 2004.  These losses are
          primarily due to increases in forward electricity prices
          in both periods.  Since the Company have fixed price
          coal contracts the Company primarily use derivative
          instruments to economically hedge power prices;

   (2) Northeast operations gross margin increased $18 million
       despite a decrease in generation volumes primarily due to:

       -- an increase of $21 million resulting from lower losses
          on realized power hedges, bilateral contracts and load
          deals;

       -- an increase of $13 million due to realized gains on fuel
          hedges;

       -- an increase of $2 million related to capacity income
          earned under a new reliability-must-run contract for
          Kendall;

       -- a decrease of $17 million due to lower generation
          volumes as a result of a reduction in spark spreads;

       -- a decrease of $6 million resulting from an increase in
          fuel prices that was greater than the increase in energy
          prices;

       -- a decrease of $8 million due to no gas sales in 2005
          compared to a gain of $8 million in 2004; and

       -- an increase of $13 million related to net unrealized
          gains on derivative instruments.

   (3) West operations gross margin decreased $3 million primarily
       due to one of our generation facilities no longer running
       under a reliability-must-run contract beginning in 2005.
       Most of the Company's generating units were under
       reliability-must-run contracts in both periods.  Under
       these contracts, revenues are based on a fixed rate of
       return and the units' operating costs.

   (4) Non-cash revenue related to the amortization of the TPAs
       decreased by $105 million primarily due to the expiration
       of one TPA in June 2004 and the remaining TPA in January
       2005.

   (5) Other gross margin increased by $82 million primarily due
       to:

       -- an increase of $133 million primarily relates to lower
          realized losses due to the expiration of the TPAs.
          Realized losses in 2005 were $8 million compared to
          $141 million in 2004;

       -- a decrease of $31 million in unrealized gains relating
          to the PPAs with PEPCO.  PPA unrealized gains were
          $48 million in 2005 compared to $79 million in 2004
          primarily because the passage of time decreases the MWh
          remaining to be purchased under the PPA; and

       -- the remaining decrease of $20 million primarily relates
          to the realized losses relating to the PPAs with PEPCO
          and realized and unrealized gains and losses on
          electricity contracts used to economically hedge the
          PPAs.

Operating Expenses

The Company's operating expenses decreased by $2 million for the
three months ended March 31, 2005 compared to the same period in
2004.  These factors were responsible for the changes in operating
expenses:

       -- Operations and maintenance expense decreased by
          $17 million and reflects a decrease of $10 million in
          corporate costs allocated to the North America segment
          in the 2005 period.  Corporate expenses allocated were
          $38 million in 2005 compared to $48 million in 2004.

       -- Gain on sale of assets decreased by $15 million
          primarily due to the sale in 2004 of our remaining
          Canadian natural gas transportation contracts and
          certain natural gas marketing contracts.

Liquidity and Capital Resources

During the pendency of their Chapter 11 proceedings, Mirant
Corporation and certain of our subsidiaries, including Mirant
Americas Generation and Mirant Mid-Atlantic, are participating in
an intercompany cash management program approved by the Bankruptcy
Court pursuant to which cash balances at Mirant and the
participating subsidiaries are transferred to central
concentration accounts and, if necessary, lent to Mirant or any
participating subsidiary to fund working capital and other needs,
subject to the intercompany borrowing limits approved by the
Bankruptcy Court.  Under the intercompany cash management program,
the Bankruptcy Court imposed borrowing limits for intercompany
loans among the respective subsidiary sub-groups.  In December
2004, the Bankruptcy Court amended the intercompany cash
management program to exclude from the intercompany borrowing
limits amounts borrowed by Mirant Americas Energy Marketing from
the non-Mirant Americas Energy Marketing sub-groups to fund cash
collateral posted and cash prepayments made to third parties on
account of transactions entered into by Mirant Americas Energy
Marketing for the benefit of the members of the non-Mirant
Americas Energy Marketing sub-groups.  All intercompany transfers
by such Mirant entities are recorded as intercompany loans on a
junior superpriority administrative basis and are secured by
junior liens on the assets of the relevant borrowing group. Upon
entering into the debtor-in-possession credit facility described
below, the cash balances of the participating Mirant Debtors
became subject to security interests in favor of the debtor-in-
possession lenders and, upon certain conditions, such cash
balances are swept into concentration accounts controlled by the
debtor-in-possession lenders.

A full-text copy of Mirant Corporation's Form 10-Q Report is
available at no charge at:


http://sec.gov/Archives/edgar/data/1010775/000110465905021788/a05-8037_110q.htm


                Mirant Corporation and Subsidiaries
                Unaudited Consolidated Balance Sheet
                        As of March 31, 2005

ASSETS

Cash and cash equivalents                         $1,574,000,000
Funds on deposit                                     279,000,000
Receivables, net                                     963,000,000
Price risk management assets                         354,000,000
Inventories                                          343,000,000
Prepaid expenses                                     252,000,000
Assets held for sale                                  94,000,000
Other                                                137,000,000
                                                 ---------------
    Total Current Assets                           3,996,000,000

Property, plant and equipment, net                 6,205,000,000
Non-current Assets:
    Intangible assets, net                           274,000,000
    Investments                                      254,000,000
    Price risk management assets                     127,000,000
    Funds on deposit                                 205,000,000
    Deferred income taxes                            185,000,000
    Other                                            282,000,000
                                                 ---------------
    Total Non-current Assets                       1,327,000,000
                                                 ---------------
TOTAL ASSETS                                     $11,528,000,000
                                                 ===============

LIABILITIES AND EQUITY

Current Liabilities:
    Short-term debt                                  $14,000,000
    Current portion of long-term debt                269,000,000
    Accounts payable and accrued liabilities         678,000,000
    Price risk management liabilities                480,000,000
    Accrued taxes and other                          189,000,000
                                                 ---------------
       Total current liabilities                   1,630,000,000

Non-current Liabilities:
    Long-term debt                                 1,019,000,000
    Price risk management liabilities                 87,000,000
    Deferred income taxes                            345,000,000
    Other                                            381,000,000
                                                 ---------------
       Total Non-current liabilities               1,832,000,000

Liabilities subject to compromise                  9,196,000,000
Minority interest in subsidiaries                    170,000,000
Stockholders' Equity:
    Common stock                                       4,000,000
    Additional paid-in capital                     4,918,000,000
    Accumulated deficit                           (6,144,000,000)
    Accumulated other comprehensive loss             (76,000,000)
    Treasury stock, at cost                           (2,000,000)
                                                 ---------------
       TOTAL STOCKHOLDERS' DEFICIT                (1,300,000,000)
                                                 ---------------
       TOTAL LIABILITIES & STOCKHOLDERS DEFICIT  $11,528,000,000
                                                 ===============


                Mirant Corporation and Subsidiaries
            Unaudited Consolidated Statements of Income
             For the three months ended March 31, 2005

REVENUES:
    Generation                                      $694,000,000
    Integrated utilities and distribution            152,000,000
                                                 ---------------
       Total Operating Revenues                      846,000,000

Cost of fuel, electricity and other products         451,000,000
                                                 ---------------
       Gross Margin                                  395,000,000
                                                 ---------------
OPERATING EXPENSES:
    Operations and maintenance                       229,000,000
    Depreciation and amortization                     77,000,000
    Impairment losses and restructuring charges        2,000,000
    Gain on sale of assets, net                       (3,000,000)
                                                 ---------------
       Total Operating Expenses                      305,000,000
                                                 ---------------
Operating Income (loss)                               90,000,000

OTHER (EXPENSE) INCOME, NET:
    Interest expense                                 (31,000,000)
    Equity in income of affiliates                     7,000,000
    Interest income                                    5,000,000
    Gain on sales of investments, net                  1,000,000
    Other, net                                        (1,000,000)
                                                 ---------------
       Total other expense, net                      (19,000,000)

Income (loss) from continuing
    operations before taxes                           71,000,000
Reorganization items, net                             61,000,000
Provision (benefit) for income taxes                  (3,000,000)
Minority interest                                      6,000,000
                                                 ---------------
    Income (loss) from continuing operations           7,000,000

Income (loss) from discontinued operations,
    net of tax                                         4,000,000
                                                 ---------------
       NET INCOME (LOSS)                             $11,000,000
                                                 ===============


                Mirant Corporation and Subsidiaries
          Unaudited Consolidated Statements of Cash Flows
             For the three months ended March 31, 2005

Cash Flows from Operating Activities:
Net income                                           $11,000,000
Adjustments:
    Amortization of power agreements                 (10,000,000)
    Depreciation and amortization                     79,000,000
    Gain on sales of assets and investments           (3,000,000)
    Equity in income of affiliates, net               (3,000,000)
    Non-cash charges for reorganization items         26,000,000
    Minority interest                                  6,000,000
    Price risk management activities, net             11,000,000
    Deferred income taxes                             (2,000,000)
    Other, net                                        13,000,000
Change in operating assets and liabilities:
    Receivables, net                                  25,000,000
    Other current assets                             (41,000,000)
    Other assets                                      22,000,000
    Accounts payable and accrued liabilities         (49,000,000)
    Taxes accrued                                     18,000,000
    Other liabilities                                  1,000,000
                                                 ---------------
       Total adjustments                              93,000,000
                                                 ---------------
       Net cash provided by operating activities     104,000,000

Cash Flows from Investing Activities:
Capital expenditures                                 (32,000,000)
Cash paid for acquisitions                                    --
Proceeds from the sale of assets                      72,000,000
Cash paid in relation to disposition                          --
Other                                                 (5,000,000)
                                                 ---------------
       Net cash provided by investing activities      35,000,000

Cash Flows from Financing Activities:
Payments on short-term debt, net                      (1,000,000)
Proceeds from issuance of debt                        10,000,000
Repayment of long-term debt                          (96,000,000)
Change in debt service reserve fund                   38,000,000
Other                                                 (1,000,000)
                                                 ---------------
       Net cash from financing activities            (50,000,000)

                                                 ---------------
Net increase (decrease) in cash                       89,000,000
Cash, beginning of period                          1,485,000,000
                                                 ---------------
Cash, end of period                               $1,574,000,000
                                                 ===============

Headquartered in Atlanta, Georgia, Mirant Corporation --
http://www.mirant.com/-- is a competitive energy company that
produces and sells electricity in North America, the Caribbean,
and the Philippines.  Mirant owns or leases more than 18,000
megawatts of electric generating capacity globally.  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.


MIRANT: Shareholders Want to Call Witnesses in Valuation Hearing
----------------------------------------------------------------
In April 2005, U.S. Bankruptcy Court for the Northern District of
Texas allowed certain Mirant Corporation shareholders to cross-
examine witnesses during the Valuation Hearing.  However, the
Court did not permit the Shareholders to make an opening
statement.  The Court also did not allow the Shareholders to call
their own witnesses in the Valuation Hearing.

The Wilson Law Firm, P.C., in Atlanta, Georgia, which represents
a number of shareholders, asks the Court to reconsider its Order
denying the Shareholders' right to call witnesses in support of
their case-in-chief and in rebuttal in the Valuation Hearing.

The Shareholders represented by The Wilson Firm and the number of
shares of Mirant stock they currently own include:

                  Shareholder          Holdings
                  -----------          --------
                  Frank Smith           145,000
                  R. Weldon Tigner       37,730
                  Dave Lucas              8,000
                  Nancy Sterk             4,000
                  David Matter           10,600
                  Lewis Clark            25,000

L. Matt Wilson, Esq., at The Wilson Law Firm, states that the
Shareholders were not properly notified of the deadlines and time
frame of the notice provisions relative to the Valuation Hearing.
Moreover, the time frame during which any interested party could
notify of its intention to participate in the Valuation Hearing
-- eight calendar days -- was entirely and unconstitutionally
"too short," whether the Shareholders were properly notified or
not.  Put simply, that brief window of opportunity within which
to exercise one's right to present evidence on one's behalf is a
violation of due process.

Additionally, the Scheduling Order and its amendments
contemplated that Valuation Hearing taking place over a course of
three days.  Instead, the trial consumed approximately two weeks.
Therefore, Mr. Wilson says, there can be no prejudice to any
other interested parties by the allowance of the Shareholders to
call witnesses.

Mr. Wilson relates that the Shareholders presently wish to call
only one witness, Terry Zerngast, CPA.  Mr. Zerngast has
extensively identified flaws in the Debtors' valuation
methodology, assumptions, and write-offs.

Mr. Wilson notes that discovery related to the Valuation dispute
is still open.  Therefore, any party wishing to depose Mr.
Zerngast prior to his testimony has the opportunity to do so.

The information to be presented by Mr. Zerngast is very important
to the Court's ultimate determination of valuation, as it
represents substantial value to the estate, which has all been
ignored by the Debtors, Mr. Wilson says.  "The Zerngast Testimony
is simply relevant and admissible evidence that no procedural
rule should bar.  It would be clear and prejudicial error not to
permit the 'CPA Expert Witness' to testify in regard to the
Debtors' value."

Headquartered in Atlanta, Georgia, Mirant Corporation --
http://www.mirant.com/-- is a competitive energy company that
produces and sells electricity in North America, the Caribbean,
and the Philippines.  Mirant owns or leases more than 18,000
megawatts of electric generating capacity globally.  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.
(Mirant Bankruptcy News, Issue No. 62; Bankruptcy Creditors'
Service, Inc., 215/945-7000)


MIRANT CORP: Deutsche Bank Says Disclosure Statement Lacks Info
---------------------------------------------------------------
Deutsche Bank Securities Inc. complains that the First Amended
Disclosure Statement filed by Mirant Corporation and its debtor-
affiliates fails to provide any meaningful information on a
debtor-specific basis, precluding creditors from fairly evaluating
the Plan as it relates to their particular debtor and also
demonstrating the Debtors' misunderstanding of how far they can
stretch consolidation in the context of jointly administered
-- but not substantively consolidated -- Chapter 11 cases.

The Debtors assume that if they "tabulate" votes correctly, they
simplistically can pursue a Chapter 11 disclosure statement and
plan for 82 debtor entities by consolidating debtors and their
creditors into two groups for all purposes except tabulation --
and satisfying Sections 1129(a)(8) and 1129(a)(10) of the
Bankruptcy Code.  However, Deutsche Bank Securities contends
that, for the Disclosure Statement to contain "adequate
information," it must present information -- in accordance with
the strict text of Section 1125 -- on a debtor-by-debtor basis.
This is especially true with respect to disclosures of assets,
liabilities, valuations and liquidation analyses.  The financial
information is the sine qua non of "adequate information,"
Deutsche Bank Securities says, yet it is intentionally omitted
from the Disclosure Statement.

Deutsche Bank Securities points out the omission of information
specific to Mirant Americas, Inc.  Deutsche Bank Securities holds
$45 million in general unsecured claims against MAI and can be
considered MAI's largest general unsecured creditor.

Deutsche Bank Securities informs the Court that it conducted an
informal analysis of the assets and liabilities of MAI based on
publicly available information and discovered that, absent
substantive consolidation, MAI creditors stand to receive a 100%
recovery.  Considering these standalone recoveries far exceed the
60% recovery projected for MAI creditors with consolidation --
and that the Debtors hope to accomplish consolidation by
obtaining sufficient votes in favor of the Plan -- Deutsche Bank
Securities asserts that the Debtors have an improper motive in
omitting MAI-specific information in the solicitation.
Disclosing this information, Deutsche Bank Securities explains,
will reveal the key effect of the Plan's structure -- to enable
MAI's equity holder, Mirant Corp., to make an impermissible
"grab" for MAI's assets and receive distributions even though
MAI's creditors are not being paid in full.

Headquartered in Atlanta, Georgia, Mirant Corporation --
http://www.mirant.com/-- is a competitive energy company that
produces and sells electricity in North America, the Caribbean,
and the Philippines.  Mirant owns or leases more than 18,000
megawatts of electric generating capacity globally.  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.
(Mirant Bankruptcy News, Issue No. 61; Bankruptcy Creditors'
Service, Inc., 215/945-7000)


MIRANT CORP: Hires Mayer Brown to Handle Predator Development Suit
------------------------------------------------------------------
Mirant Corporation and its debtor-affiliates sought and obtained
the U.S. Bankruptcy Court for the Northern District of Texas'
authority to employ Mayer, Brown, Rowe & Maw LLP, as their special
counsel effective as of October 1, 2004.

Mayer Brown provided a variety of legal services to Mirant since
1998, including responding on behalf of Mirant Americas Energy
Capital, L.P., to a document subpoena served by Predator
Development Company, LLC, in a December 2001 lawsuit styled
Stroud Investments 2001, Ltd. and Stroud Oil Properties, Inc. v.
Predator Development Co., LLC (Cause No. 67-192641-02), in the
67th Judicial District Court of Tarrant County, Texas.

Predator asserted claims against Stroud Oil Properties, Inc., and
Stroud Investments 2001, L.P., arising from an oil and gas joint
development agreement between the parties.  Predator sought
documents from MAEC, Stroud's lender, to support its claims.

On June 16, 2003, Predator filed a third-party action in the
State Court Lawsuit against Mirant Corporation, MAEC, and Mirant
Americas Energy Capital Assets.  Predator alleged that MAEC had
tortiously interfered both with the JDA and Predator's own
independent financing, and had conspired with Stroud to do so.
Predator alleged that Mirant Corp. and MAEC Assets were jointly
and severally responsible for any damages caused by MAEC because
the three entities allegedly constituted a "single business
enterprise."  Mayer Brown represented the Mirant Entities in the
suit.

All proceedings in the State Court Lawsuit against the Mirant
Entities were stayed on the Petition Date.

The Debtors continued to employ Mayer Brown postpetition as an
ordinary course professional.  Until October 2004, Predator took
no action to pursue its claims against the Mirant Entities other
than filing its proofs of claim with the Bankruptcy Court.
However, Predator continued to aggressively pursue its claims
against Stroud.

Ian T. Peck, Esq., at Haynes and Boone, LLP, in Dallas, Texas,
relates that, in the almost three years of litigation between
Predator and Stroud, which was settled in October 2004, Predator
and Stroud had exchanged hundreds of thousands of pages of
documents, identified more than a thousand trial exhibits,
deposed more than 50 people, identified well over a hundred trial
witnesses, and filed summary judgment briefing approaching 500
pages, exclusive of exhibits, all of which were relevant to the
Mirant Entities' alleged liability as a result of Predator's
conspiracy claims.  Because all of the litigation was conducted
either before the Mirant Entities were made parties to the case
or after the claims against the Mirant Entities were stayed by
the bankruptcy filing, the Mirant Entities had not substantively
participated in the case as of mid-October 2004, other than
remaining aware of the status of the case from pleadings served
and providing a deposition defense to its former employees and
outside counsel.  As a result, the Mirant Entities had 70 days to
get the case ready for trial against an opponent with a three-
year head start on the underlying discovery while at the same
time defending against a liability-expanding "single business
enterprise" allegation.

As a result of the aggressive timeframe set for the completion of
discovery and trial of the lawsuit, and the head start by
Predator, the work required of Mayer Brown has resulted in
monthly invoices in excess of the $50,000 cap set forth in the
Ordinary Course Professional Order.  During the months between
mid-October and December 17, 2004, among other things, Mayer
Brown responded to 291 document requests by Predator, requiring
the review of over 1 million pages of documents.  Predator
produced 300,000 pages of documents in response to the Mirant
Entities' requests, identified more than 70 people it intended to
call as witnesses at trial, including 10 experts, and identified
almost as many people it intended to depose before the close of
discovery.  Mayer Brown also prepared and produced corporate
representative witnesses in response to the 94 categories of
testimony requested by Predator, and took all other necessary
steps to prepare for trial.

The Predator lawsuit was settled on December 17, 2004.  Mayer
Brown was in the process of being moved from the status of
ordinary course provider to the non-ordinary course list at the
time a settlement was reached in the Predator case.

Because of the incredibly short timeframe in which Debtors had to
prepare for trial and the complex nature of the dispute, Mr. Peck
says the work required to bring the dispute to resolution
required Mayer Brown to work at a level that merits its retention
as special counsel rather than as an ordinary course
professional.  Mayer Brown is not anticipated to play a prominent
role in the Debtors' Chapter 11 cases in the future.  While Mayer
Brown will continue to represent the Mirant Entities in the
Predator matter, any remaining work to be performed is expected
to involve primarily administrative details related to finalizing
the settlement and release with Predator, and those activities
are expected to be minimal.

Terry D. Kernell, Esq., a partner at Mayer Brown, ascertains that
the firm does not have or represent any connection with or any
interest adverse to the Debtors or their estates.  Mayer Brown is
a "disinterested person" as that term is defined in Section
101(14) of the Bankruptcy Code.

Headquartered in Atlanta, Georgia, Mirant Corporation --
http://www.mirant.com/-- is a competitive energy company that
produces and sells electricity in North America, the Caribbean,
and the Philippines.  Mirant owns or leases more than 18,000
megawatts of electric generating capacity globally.  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.
(Mirant Bankruptcy News, Issue No. 60; Bankruptcy Creditors'
Service, Inc., 215/945-7000)


MOONEY AEROSPACE: 2004 Year-End Revenues Up 16% to $19.3 Million
----------------------------------------------------------------
Mooney Aerospace Group, Ltd. (OTC Bulletin Board: MNYG) reported
its financial results for the year ended December 31, 2004.  Net
sales for the year ended December 31, 2004 increased 16% to
$19,314,000 as compared to $16,617,000 for the year ended
December 31, 2003.

J. Nelson Happy, Vice Chairman and President of Mooney Aerospace
Group, Ltd., stated, "Year 2004 was an eventful year for us.  We
underwent reorganization through the filing and confirmation of a
plan approved by our creditors and the U. S. Bankruptcy Court in
Wilmington, Delaware, which has been fully consummated.  Our
reorganization was necessitated primarily by obligations assumed
by the company during the development of the Jetcruzer program.
Our decision to acquire Mooney's assets has proved to have been
wise, and we are pleased at the progress our wholly owned
subsidiary, Mooney Airplane Company, (MAC) is making."

In mid-2004 MAC embarked upon a multi-faceted plan to become
profitable.  MAC plans to focus on ramping up production, reducing
its cost of production, increasing its order book, building an
unmatched customer service and support system, expanding its
marketing and sales efforts and assembling a management team that
blends both experience in aviation and business management.  The
Company reported total orders of 80 and deliveries of 36 aircraft
by year-end 2004.  The Company defines an order taken when a
contract is signed between the Company and the customer, and the
company receives a deposit.  A delivery is recorded as a sale on
the Company's income statement when the balance of the purchase
price is paid in full and the airplane is delivered to the
customer.

Gretchen Jahn, CEO of Mooney Airplane Company, said, "We turned a
significant new corner in 2004, a year in which Mooney re-
established itself as a viable company and leader in the high-
performance retractable gear single-engine aircraft category.  We
achieved a strong order book totaling 80 orders and delivered 36
aircraft in 2004.  During 2005, we intend to build upon our recent
accomplishments to increase sales of aircraft nationwide,
including leveraging our strong brand name recognition earned from
more than 50 years in the aviation industry.  In addition to
selling airplanes, Mooney is building an unmatched customer
support division to provide pilots competitive and superior
aftermarket parts and services, creating an additional highly
profitable revenue stream for Mooney and boosting sales of our
aircraft."

Ms. Jahn added, "We plan to continue to ramp up our production
with a focus on reducing costs per unit, streamlining operations
and internalizing the manufacturing process.  With our scalable
production facility and enhanced marketing and sales efforts, we
are on track to more than double our aircraft deliveries and
exceed last year's total order book in 2005."

Headquartered in Kerrville, Texas, Mooney Aerospace Group, Ltd.
-- http://www.mooney.com/-- is a general aviation holding company
that owns Mooney Airplane Co., located in Kerrville, Texas.  The
Company filed for chapter 11 protection on June 10, 2004 (Bankr.
Del. Case No. 04-11733).  Mark A. Frankel, Esq., at Backenroth
Frankel & Krinsky LLP, represented the Debtor in its
restructuring.  When the Company filed for protection from its
creditors, it listed $16,757,000 in total assets and $69,802,000
in total debts.  The Court confirmed Mooney's Plan of
Reorganization on Dec. 15, 2004, allowing the Company to emerge on
Dec. 16, 2004.

                        *     *     *

As reported in the Troubled Company Reported on May 2, 2005,
Mooney Aerospace Group had a negative working capital of
$3,840,000 and stockholders' deficiency of $23,797,000 at
December 31, 2004.  Since its inception in January 1990, the
Company has experienced continuing negative cash flow from
operations, which have resulted in an inability to pay certain
existing liabilities in a timely manner.  The Company has financed
its operations through private funding of equity and debt and
through the proceeds generated from its December 1996 initial
public offering.


NATIONAL BENEVOLENT: Moody's Withdraws Ca Rating After Repayment
----------------------------------------------------------------
Moody's has withdrawn National Benevolent Association's Ca bond
ratings in conjunction with the full repayment of principal and
interest on all rated fixed rate bonds effective April 18, 2005,
under a plan of reorganization overseen by the bankruptcy court.
The rating withdrawal affects approximately $151 million of fixed
rate bonds.  The repayment covered 100% of outstanding principal,
100% of accrued interest through the February 16, 2004 bankruptcy
filing, and interest rates ranging from 2.17% to 2.4% from
February 16, 2004 to April 18, 2005.  Proceeds derived primarily
from the sale of the majority of NBA's senior living facilities to
Fortress NBA Acquisition, LLC, an investor group.

These bond issues have been repaid and the ratings withdrawn:

    1. Oklahoma County Industrial Authority, Series 1997 (Oklahoma
       Christian Home), $2.1 million outstanding

    2. Colorado Health Facilities Authority, Series 1998A (Multi-
       Facility Refunding), $10.5 million

    3. Bexar County (TX) Health Facilities Development
       Corporation, Series 1992B (Patriot Heights), $1.8 million

    4. Health & Educational Facilities Authority of Missouri,
       Series 1996A (Woodhaven Learning Center), $2.1 million

    5. Colorado Health Facilities Authority, Series 1998B (Village
       at Skyline), $14.85 million

    6. Health & Educational Facilities Authority of Missouri,
       Series 1994 (Lenoir Retirement Community), $3.5 million

    7. Oklahoma County Industrial Authority, Series 1999 (Oklahoma
       Christian Home), $3.9 million

    8. Colorado Health Facilities Authority, Series 1999A (Village
       at Skyline), $9.2 million

    9. Jacksonville (FL) Health Facilities Authority, Series 2000A
       (Cypress Village Florida), $9.7 million

   10. Colorado Health Facilities Authority, Series 2000C (Village
       at Skyline), $9.95 million

   11. Industrial Development Authority of Cass County, Missouri,
       Series 1992 (Foxwood Springs Living Center), $4.4 million

   12. Illinois Development Finance Authority, Series 1996 (Barton
       W. Stone Christian), $2.6 million

   13. Iowa Finance Authority ,Series 1997 (Ramsey Home),
       $5.8 million

   14. Jacksonville (FL) Health Facilities Authority, Series 1992
       (Cypress Village Florida), $23.95 million

   15. Jacksonville (FL) Health Facilities Authority, Series 1993
       (Cypress Village Florida), $8.0 million

   16. Jacksonville (FL) Health Facilities Authority, Series 1994
       (Cypress Village Florida), $4.7 million

   17. Jacksonville (FL) Health Facilities Authority, Series 1996A
       (Cypress Village Florida), $7.3 million

   18. Colorado Health Facilities Authority, Series 1995A (Village
       at Skyline), $4.4 million

   19. City of Indianapolis, Indiana, Series 1992 (Robin Run
       Village), $22.1 million


NATIONAL CENTURY: Court Orders DFS & DynaCorp to Return $2.1 Mil.
-----------------------------------------------------------------
As reported in the Troubled Company Reporter on Oct. 13, 2004, the
Unencumbered Assets Trust and the VI/XII Collateral Trust, as
successors to and transferees of National Century Financial
Enterprises, Inc., and its debtor-affiliates sought to recover and
avoid transfers totaling $2,119,889 made to DFS Secured Healthcare
Receivables Trust and DynaCorp Secured Healthcare Receivables
Trust.

As reported in the Troubled Company Reporter on Mar. 17, 2005, DFS
& DynaCorp successors won't return the transfers.

                          Parties Settle

As previously reported, Sun Capital Healthcare, Inc., provided
accounts receivable factoring to Lincoln Hospital Medical Center,
Inc.  The Debtors and DFS Secured Healthcare Receivables Trust
provided financing to Lincoln.

Pending resolution of the interests of the Debtors and DFS in
Lincoln's accounts receivable, Sun is holding $278,877 of
proceeds of the receivables in a segregated account.

On April 21, 2003, DFS filed Claim No. 313 in the Debtors'
Chapter 11 cases, asserting a $1,910,891 claim allegedly secured
by the Accounts Receivable and its proceeds.  Fund America, Inc.,
subsequently purchased the Claim including all the rights, claims
and interests of DFS against Lincoln or the Debtors.

To resolve disputes relating to the Sun Segregated Account, the
DFS Claim and the Adversary Proceeding; the Unencumbered Assets
Trust, the VI/XII Collateral Trust and Fund America entered into
a settlement agreement.

The parties agree that:

    (a) Sun will transfer $110,000 from the Sun Segregated
        Account to the VI/XII Trust's account and the remaining
        funds in the Account to Fund America;

    (b) Fund America will withdraw the DFS Claim with prejudice;

    (c) The VI/XII Trust will release its interest in the
        remaining amounts in the Sun Segregated Account;

    (d) Fund America will not oppose the Trusts' motion for
        default judgment against DFS;

    (e) Fund America will provide an affidavit stating that Fund
        America did not receive any assets or funding from DFS
        other than DFS' interest in the DFS Claim, the Sun
        Segregated Account and the claims of DFS against the
        Choice assets;

    (f) Fund America will release the Trusts, the Debtors and the
        Debtors' estates, from all claims relating to the DFS
        Claim, the Adversary Proceeding or the Sun Segregated
        Account;

    (g) The Trusts discharge Fund America from any claims arising
        in connection with the Adversary Proceeding or the Sun
        Segregated Account; and

    (h) Fund America will indemnify and hold harmless the Trusts
        from all claims, actions and losses arising as a result of
        a breach by Fund America of any of the agreements,
        representations or warranties as to Fund America's
        ownership of the DFS Claim, its interest in the Sun
        Segregated Account or its authority to enter into the
        Settlement Agreement.

               Court Rules on Default Judgment Motion

Judge Calhoun grants the Unencumbered Assets Trust's request.
Accordingly, the Court enters a default judgment against DFS for
$2,119,889 plus pre- and post-judgment interest.

Objections to the Default Judgment Motion are either withdrawn or
overruled.

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. S.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. (National Century Bankruptcy News, Issue No. 54;
Bankruptcy Creditors' Service, Inc., 215/945-7000)


NAUTICAL DATA: Canadian Hydrographic Can't Terminate Contract
-------------------------------------------------------------
Nautical Data International Inc. reported that the Supreme Court
of Newfoundland and Labrador has concluded that its Feb. 10, 2005
Order is continued in accordance with its terms as amended.

The Order restrains the Canadian Hydrographic Services -
Department of Fisheries and Oceans from breaching and terminating
its contract with Nautical Data International, Inc.

The Court has also declared that:

     (i) Canadian Hydrographic has not terminated the CHS Contract
         in accordance with its terms,

    (ii) the CHS Termination Letter dated January 4, 2005 is
         "nothing more than an ineffective unilateral repudiation
         of the CHS Contract by CHS"; and

   (iii) Canadian Hydrographic has no right to terminate the CHS
         Contract as they purported to do under the Termination
         Letter.

The Judgment was entered on May 10, 2005, as a result of the Court
hearing and deliberations on April 12-13, 2005, of Canadian
Hydrographic's motion.   Canadian Hydrographic moved, on
February 21, 2005, to set aside or vary the Supreme Court of
Newfoundland and Labrador's order and the counter motion brought
by Nautical Data, seeking, among other things, a declaration that
the purported termination of the CHS Contract by Canadian
Hydrographic is of no force and effect.

                           Background

Nautical Data has an ongoing contract with Canadian Hydrographic.
The CHS Contract gives Nautical Data the sole worldwide right and
license to use, and sublicense the use of, any data owned by
Canada and maintained by Canadian Hydrographic to produce data
products and product updates, to integrate such products with
other products and services and to distribute them directly to
Nautical Data's customers or through third party distributors and
value added resellers.

In the Termination Letter dated January 4, 2005, Canadian
Hydrographic purported to terminate the CHS Contract effective
February 4, 2005.  Nautical Data has not accepted the termination,
and strongly believes that Canadian Hydrographic had no basis to
do so.  As a result of the actions of Canadian Hydrographic, on
February 2, 2005, Nautical Data filed a Notice of Intention to
make a Proposal under the Bankruptcy and Insolvency Act.  On
February 10, 2005, the Supreme Court of Newfoundland and Labrador
granted an Order restraining Canadian Hydrographic from breaching
and terminating the CHS Contract.

Nautical Data is the sole worldwide distributor of the official
Canadian electronic navigation charts and other digital nautical
information.  A privately held Canadian company based in St.
John's, Newfoundland and Labrador, Nautical Data distributes its
digital data products including the Canadian Hydrographic
certified digital charts under the brand DigitalOcean(R) for
recreational boating, sports fishing, and commercial navigation
purposes as well as for other non- navigation applications.  In
partnership with Canadian Hydrographic since 1993, Nautical Data
has successfully developed a comprehensive digital cartography
database comprised of thousands of nautical charts and other
marine information covering navigable Canadian waters and coastal
zones.

In the years since 1993, Nautical Data has worked with Canadian
Hydrographic to develop, commercialize, and promote several
digital hydrographic products for navigation and other uses,
including raster charts for recreational boaters and vector charts
for commercial shipping, and chart updating services for all
market segments. These products and services are delivered in an
open, transparent, and uniform manner in keeping with the mandate
of CHS to serve the public good.

Nautical Data has invested substantially in the development and
commercialization of data products and services, and in creating
the necessary information infrastructure and distribution network.
NDI's distribution network consists of more than 75 dealers and
value-added resellers that spans across the country and abroad.


NEENAH PAPER: Earns $2.7 Million of Net Income in First Quarter
---------------------------------------------------------------
Neenah Paper (NYSE: NP) reported first quarter 2005 net income of
$2.7 million.  Results included $0.19 per share for restructuring
and asset impairment charges related to the previously announced
closure of the Terrace Bay No. 1 pulp mill.  Net income in the
first quarter of 2004, during which operations were part of
Kimberly-Clark, was $15.1 million or $1.03 per diluted common
share and did not include interest expense or other changes
resulting from being a stand-alone company.

                     First Quarter Results

Consolidated net sales for the first quarter of 2005 were
$196.6 million versus $198.4 million in the first quarter of 2004.
Sales in each of the paper businesses grew as a result of higher
volumes and prices, and in total increased 4 percent.  Pulp sales
declined 4 percent as lower volumes and increased discounts offset
higher market prices.  Operating income was $8.9 million,
including $4.3 million of pre-tax charges associated with the
shutdown of the Terrace Bay No. 1 pulp mill.  Operating income in
the first quarter of 2005 also was impacted by a stronger Canadian
dollar, which increased costs by approximately $8 million.
Results for the first quarter of 2005 included corporate expenses
of $6.7 million for administrative costs incurred as a result of
being a stand-alone company and for payments to Kimberly-Clark as
part of a transition services agreement for 2005.  Operating
income in the first quarter of 2004 was $24.3 million.

Fine Paper net sales for the first quarter of 2005 grew 3 percent
versus prior year with volumes up 8 percent.  Volumes were boosted
by additional sales of paper used for corporate annual reports.
Operating income for fine paper in the first quarter of 2005 was
$17.0 million, compared with $18.2 million in the first quarter of
2004.  In 2005, operating income was impacted by increased costs
for fiber and allocated corporate expenses.

In the Technical Paper segment, net sales for the first quarter of
2005 versus the first quarter 2004 were up 5 percent on 4 percent
volume growth.  Sales increased from higher prices and an improved
product mix as well as double-digit volume growth in overseas
markets.  Operating income for Technical Paper during the first
quarter was $4.7 million, compared with $7.1 million in the
same period of 2004.  Oil-based latex costs were approximately
$1 million higher in 2005 compared to the prior year and the
segment also incurred increases for fiber and allocated corporate
expenses.

Net sales of pulp in the first quarter of 2005 declined 4 percent
compared to the first quarter of 2004.  While production levels
were consistent in both periods, sales volumes decreased 7 percent
as inventories were increased during the first quarter of 2005 to
comply with contractually required safety stock levels.  Average
market prices compared with the prior year quarter increased
approximately 7-10 percent, although this was offset by higher
discounts on sales to Kimberly-Clark. The pulp segment had a first
quarter 2005 operating loss of $11.1 million, including the
aforementioned impacts of a stronger Canadian dollar and the
Terrace Bay No. 1 mill charge.  Higher costs for raw materials,
energy and allocated corporate expenses were partly offset by
lower depreciation and other manufacturing cost reductions.  In
the first quarter of 2004, the pulp segment generated a loss of
$1.0 million.

Commenting on results, Sean Erwin, Chairman and Chief Executive
Officer said, "We are seeing results from our initiatives and are
pleased with the continued top-line growth in both of our paper
businesses.  While increased prices for raw materials and energy
and a much stronger Canadian dollar present more challenging
conditions than in past years, our teams are responding and were
able to deliver over $4 million of cost savings in the first
quarter.  In addition, we are following through on our plans to
address Terrace Bay's long-term competitiveness and closed the
smaller No. 1 mill on May 1.  Our pulp and woodlands operations
continue to represent a primary focus area and we are pursuing
actions and strategic alternatives to improve the structure of
these operations and provide increased value to our shareholders."

                        Amended 10-K Filing

As a result of the quarterly review during 2005, it was determined
that the opening balance for net deferred income tax assets
recorded as part of the spin-off transaction on November 30, 2004
was overstated by $20.9 million.  Consequently, the amounts of
deferred tax assets and additional paid-in capital on the
consolidated balance sheet and statement of stockholders' equity
as of and for the year ended December 31, 2004 will be restated.
The misstatement had no impact on previously reported 2004 net
income or losses and cash flow amounts.  An amended Form 10-K will
be filed with the Securities and Exchange Commission to reflect
this change.

Neenah Paper, Inc. -- http://www.neenah.com/-- manufactures and
distributes a wide range of premium and specialty paper grades,
with well-known brands such as CLASSIC(R), ENVIRONMENT(R),
KIMDURA(R) and MUNISING LP(R).  The company also produces and
sells bleached pulp, primarily for use in the manufacture of
tissue and writing papers.  Neenah Paper is based in Alpharetta,
Georgia, and has manufacturing operations in Wisconsin, Michigan
and in the Canadian provinces of Ontario and Nova Scotia.

                         *     *     *

As reported in the Troubled Company Reporter on Nov. 10, 2004,
Moody's Investors Service assigned a B1 rating to Neenah Paper,
Inc.'s proposed $200 million guaranteed senior unsecured notes due
2014, and a Ba3 rating to the company's proposed $150 million
senior secured revolving credit facility.  In addition, Moody's
assigned a B1 senior implied rating, B3 senior unsecured issuer
rating, and SGL-2 speculative grade liquidity rating to the
company.  The outlook for the ratings is stable.  This is the
first time Moody's has rated the debt of Neenah.

As reported in the Troubled Company Reporter on Nov. 9, 2004,
Standard & Poor's Ratings Services assigned its 'B+' corporate
credit rating to forest products producer Neenah Paper, Inc., in
connection with the company's spin-off from Kimberly-Clark
Corporation.

At the same time, Standard & Poor's assigned its 'BB+' bank loan
rating and its recovery rating of '1+' to Neenah's proposed
$150 million senior secured credit facility.  The rating is three
notches above the corporate credit rating; this and the '1+'
recovery rating indicate that bank lenders can expect a full
recovery of principal and interest in the event of a default.

In addition, Standard & Poor's assigned its 'B+' senior unsecured
debt rating to the Alpharetta, Georgia-based company's
$200 million senior unsecured notes due 2014, to be issued under
Rule 144a with registration rights.

The senior unsecured debt is rated the same as the corporate
credit rating based on Standard & Poor's expectations that the
level of Neenah's priority liabilities, relative to its assets,
will not place senior unsecured lenders at a material disadvantage
in a bankruptcy.  All of these newly assigned ratings are based on
preliminary terms and conditions.  S&P says the outlook is stable.


NEORX CORP: 40% Lay-Off Doesn't Trigger Bank Loan Default
---------------------------------------------------------
NeoRx Corporation (NASDAQ:NERX) said last week that it is
implementing a strategic restructuring to refocus its resources to
expedite development of picoplatin (NX 473), a next-generation
intravenous platinum chemotherapeutic agent specifically designed
to improve on the safety and efficacy of existing platinum
therapeutics for cancer.

As a result of this restructuring, NeoRx has discontinued the
clinical development of STR for multiple myeloma and other
indications, and will reduce its workforce by approximately 40% --
laying off 21 of its 50 workers.  The Company also announced plans
to cease operations at its facility in Denton, Texas, where STR
was being manufactured.  The Company will redirect its resources
to its picoplatin development program, including the initiation of
its planned Phase II trial of picoplatin in small cell lung cancer
in mid-2005, as well as the initiation of a clinical program in
colorectal cancer by early 2006 and potentially other indications.

                    No Default at Present

In connection with its 2001 purchase of the radiopharmaceutical
manufacturing plant and other assets located in Denton, Texas, the
Company assumed $6,000,000 principal amount of restructured debt
held by Texas State Bank in McAllen, Texas.  The loan, which
matures in April 2009, is secured by the assets acquired in the
transaction.

The terms of the Texas State Bank loan provide that an event of
default may be deemed to occur if the Company abandons, vacates or
discontinues operations on a substantial portion of the Denton
facility or there is a material adverse change in the Company's
operations.  If this were to occur, Texas State Bank could declare
the entire outstanding amount of the loan ($4.2 million at March
31, 2005) due and immediately payable.  In that case, the
Company's cash resources and assets could be impaired depending on
its ability to raise funds through a sale of the Denton facility
or other means.

Texas State Bank has confirmed that it will not declare the loan
in default based solely on the Company's suspension, either
temporarily or permanently, of manufacturing activities at the
Denton facility.  Additionally, the Company does not believe that
its strategic restructuring announced on May 6, 2005, constitutes
a material adverse change in the Company's operations or would
affect the Company's ability to continue to make payments under
the loan, which would cause Texas State Bank to accelerate the
loan, nor has Texas State Bank indicated that it views the
restructuring as such.

The Company can provide no assurance, however, that Texas State
Bank will not some time in the future seek to rely on these or
other provisions to declare the Company in default of the loan.
Based on a November 2002 appraisal of the Denton facility, the
fair value of the facility and its assets exceeds the amount of
the outstanding debt.

                         About NeoRx

NeoRx -- http://www.neorx.com/-- is a cancer therapeutics
development company.  The Company currently is focusing its
development efforts on picoplatin (NX 473), a next-generation
platinum therapy that the Company plans to evaluate in the
treatment of patients with advanced lung and colorectal cancers.

NeoRX's balance sheet dated March 31, 2005, shows $25.6 million in
assets.


NEW WORLD RESTAURANT: March 29 Balance Sheet Upside-Down by $117MM
------------------------------------------------------------------
New World Restaurant Group, Inc. (Pink Sheets: NWRG.PK) reported
financial results for the first quarter of fiscal 2005.

Total revenues increased 2.3% to $93.3 million during the quarter
ended March 29, 2005, as compared to $91.2 million in the first
quarter of fiscal 2004.  Retail sales grew 2.6% to $86.9 million,
or 93.1% of total revenue, in the 2005 quarter from $84.6 million,
or 92.8% of revenue, a year ago.  As previously reported,
comparable store sales in company-owned restaurants grew 4.6% over
the corresponding quarter of 2004.

Gross profit margin increased to 18.4% of sales in the 2005
quarter from 18.1% a year ago, while general and administrative
expenses decreased 1.6% to $8.7 million, or 9.3% of revenues, from
$8.8 million, or 9.7% of revenues, a year earlier. Depreciation
and amortization expense, which is included in income from
operations, decreased to $6.7 million from $6.8 million in the
first quarter of 2004.

Income from operations for the first quarter was $1.7 million,
unchanged from the 2004 quarter, which benefited from the reversal
of a prior accrual of approximately $0.8 million associated with
integration and reorganization costs. Results for the fiscal 2005
quarter included approximately $0.1 million in impairment charges
and other related costs.

"The continued improvement in retail sales and operating results
indicates that our brand enhancement strategies are on target,"
said Paul Murphy, New World CEO. "The shift in product mix to
higher priced items, introductions of new menu items, selective
price increases, and improvements to customer service and the look
of our restaurants have all contributed to our gains in comparable
store sales. The benefits of these efforts are further underscored
by the positive trends we've seen in average check size and
transaction counts over the past four quarters. Year-over-year
increases in average check size have steadily grown from 0.7% in
the first quarter of 2004 to 6.4% in the first quarter of 2005.
Concurrently, transaction counts have improved from a 5.5% decline
in 2004's first quarter to a decrease of just 1.7% in the first
quarter of 2005.

"We are additionally focused on growing comparable store and
overall sales by incorporating the most successful elements of the
new Einstein Bros. Cafe quick casual concept in existing Einstein
Bros. Bagels restaurants and by opening additional locations under
this new banner," Mr. Murphy continued. "To date, we have opened
seven Einstein Bros. Cafes in the Denver and Colorado Spring
markets, most of which were conversions of Einstein Bros. Bagels
locations. Another Einstein Bros. Cafe will open in Longmont,
Colo. this week."

The company reported a net loss of $4.2 million in the first
quarter of 2005, compared to a net loss of $4.1 million.  In
addition to the benefit of $0.8 million in integration and
reorganization costs in the first quarter of 2004 described above,
the slightly higher net loss for the 2005 quarter reflected a 2.1%
increase in net interest expense to $5.9 million from $5.8 million
a year earlier.

New World's operations consumed $6.3 million of cash during the
first quarter of 2005, compared with $4.2 million a year earlier.
Chief financial officer Richard P. Dutkiewicz noted that
requirements for semi-annual interest payments on New World's $160
million notes generally cause the company to consume cash during
the first and third quarters.  In addition to the $10.4 million
payment on the notes, the amount of cash consumed during the 2005
quarter was impacted by accelerating payments to the company's
vendors.

In the first quarter of 2005, New World engaged Bear Stearns to
assist in the potential refinancing of the $160 million notes and
the AmSouth Revolver.  The company believes that refinancing this
outstanding debt at a favorable interest rate could increase its
letter of credit capacity, reduce interest expense and provide
additional flexibility for future store growth.

New World Restaurant operates locations primarily under the
Einstein Bros. and Noah's New York Bagels brands and primarily
franchises locations under the Manhattan Bagel and Chesapeake
Bagel Bakery brands.  As of March 29, 2005, the company's retail
system consisted of 449 company-operated locations, as well as 170
franchised and 60 licensed locations in 34 states, and the
District of Columbia. The company also operates a dough production
facility.

At March 29, 2005, New World Restaurant's balance sheet showed a
$116,664,000 stockholders' deficit, compared to a $112,483,000
deficit at Dec. 28, 2005.

                        *     *     *

As reported in the Troubled Company Reporter on Apr. 18, 2005,
Moody's Investors Service rated the proposed $140 million first-
lien secured Credit Facility of New World Restaurant Group, Inc.
at B3 and the $45 million second-lien secured Loan at Caa1,
subject to review of final documentation.  Proceeds from the new
debt will principally be used to refinance the existing $160
million issue of 13% senior secured notes (2008).

Negatively impacting the ratings are Moody's expectation that free
cash flow will remain tight for several years, given that the
company is at the beginning of an operating turnaround and will
invest in modernizing its store base, and the long-term challenges
in updating the company's image as more than a seller of bagels.
In spite of the substantial debt burden, the recent progress at
stabilizing operations and the potential to improve operating
efficiency through growing non-breakfast sales benefit the
ratings.

Moody's said the rating outlook continues to be stable.


NEXTEL PARTNERS: Strong Performance Prompts Moody's to Up Ratings
-----------------------------------------------------------------
Moody's Investors Service upgraded the ratings of Nextel Partners,
Inc. and its subsidiary Nextel Partners Operating Corp.  The
upgrade is based upon the continued strong financial and operating
performance of the company, Moody's expectation that this strong
performance will continue, as well as the company's commitment to
debt reduction, which will accelerate achievement of 10% free cash
flow to total debt.  The ratings outlook remains positive.

The affected ratings are:

   -- Nextel Partners, Inc.

      * Senior implied rating upgraded to Ba2 from B1

      * Issuer rating withdrawn

      * 8.125% Senior Notes due 2011 upgraded to Ba3 from B3

      * 12.5% Senior Notes due 2009 upgraded to Ba3 from B3

      * Speculative grade liquidity rating upgraded to SGL-1 from
        SGL-2

   -- Nextel Partners Operating Corp.

      * $100 million senior secured revolving credit facility
        expiring 2009 upgraded to Ba1 from Ba3

      * $550 million senior secured term loan D maturing May 2012
        assigned Ba1

      * $700 million senior secured term loan C maturing May 2011
        rating withdrawn

Since Moody's last upgraded Nextel Partners' ratings in November
2004, the company has continued to post robust subscriber and cash
flow growth.  Management's latest public guidance for subscriber
and free cash flow growth are significantly above Moody's prior
expectations.  Further, management has committed to materially
reduce its outstanding debt in 2005.  The combination of higher
amounts of free cash flow and lower debt balances will
significantly accelerate the achievement of Moody's threshold
ratio of 10% free cash flow to total debt established in November
2004 for an ratings upgrade.  Moody's now expects this ratio to
exceed 15% by year-end 2005.

The Ba1 rating on the senior secured bank debt of Nextel Partners
Operating Corp., a subsidiary of the ultimate parent holding
company, Nextel Partners, Inc., reflects Moody's opinion of the
strong asset coverage available to these lenders.  The Ba3 rating
on the senior unsecured debt of Nextel Partners, Inc., reflects
the subordination of these claims to the bank debt and other
obligations of the company's subsidiaries.  However, given the
reduced amount of bank debt in the capital structure as well as
the reduced default risk associated with a Ba2 senior implied
rating, Moody's now rates this level of the capital structure
closer to the senior implied rating.

Moody's continues to be impressed by the still rapid rate of
subscriber growth Nextel Partners has achieved and expects to
achieve in 2005.  In 2004, total subscribers grew almost 30% and
the company forecasts growth of over 23% for 2005.  More
importantly, the company forecasts EBITDA to grow 40% this year.
These are remarkable statistics for a premium priced service in
competitive industry.  Further, with capital expenditures
increasing only modestly, this will yield a dramatic increase in
free cash flow.

Additionally, Moody's expects the Class A shareholders of Nextel
Partners to have the ability to put the company to the combined
Sprint Nextel once that merger closes later this year.  Given the
high probability that within the next 18 to 24 months Nextel
Partners becomes a wholly owned subsidiary of what Moody's expects
to be an investment grade rated carrier, the rating outlook
remains positive.  The ratings outlook could change, however,
should the likelihood that the merger between Sprint Corp. (senior
unsecured Baa3) and Nextel Communications (senior implied Ba2, on
review for upgrade) not close substantially increase, and should
Nextel Partners operating and financial performance begin to stall
from their pace of rapid improvement.

Moody's has upgraded the company's speculative grade liquidity
rating to SGL-1 denoting a "very good" liquidity profile.  Despite
the diminution of the company's liquidity through paying down
$150 million of bank debt with its excess cash, Moody's expects
Nextel Partners to generate increasing amounts of free cash flow
and to maintain cash and available revolver capacity of over
$200 million in each of the next four quarters.  Nextel Partners
has no material mandatory debt amortization requirements until
2007, and the company maintains substantial covenant cushion.
This combination of large, readily available liquidity, no
material amortization, and substantial covenant cushion yield a
"very good" liquidity profile in Moody's opinion, warranting an
SGL-1 rating.

Based in Kirkland, Washington, Nextel Partners is a provider of
wireless telecommunications services serving over 1.7 million
subscribers and LTM revenue of $1.5 billion.


O'SULLIVAN IND: March 31 Balance Sheet Upside-Down by $197.5 Mil.
-----------------------------------------------------------------
O'Sullivan Industries Holdings, Inc. (OTC Bulletin Board: OSULP),
reported net sales of $68.5 million for its third quarter ended
March 31, 2005.  Third quarter sales decreased 6.4% over prior
year sales of $73.2 million.  Net sales grew sequentially 3.6%
over second quarter and represented the third consecutive quarter
of increasing sales.

"These results are in line with our expectations as we continue to
reorganize O'Sullivan and solidify our infrastructure," commented
Bob Parker, President and CEO.  "While we would like to see
increased sales and profits earlier, we are on track with our plan
to turn O'Sullivan around and begin to deliver increases in fiscal
2006."

Cash flow for the third quarter was a negative $4.0 million as
compared to the positive $6.3 million reported in the prior year
period.  Cash flow for the nine months ended March 31, 2005 was
$1.8 million compared to $9.6 million in the prior period. Ending
cash balance as of March 31, 2005 was $7.1 million and there was
no outstanding balance on the revolving line of credit.  These
results reflect management's detailed focus on controlling working
capital and cash management while executing their strategic
business plan.

Net loss for the third quarter of fiscal 2005 was $13.2 million
compared to a net loss of $5.3 million for the prior year period.
Net loss for the nine months ended March 31, 2005 was $33.9
million vs. prior year's $18.0 million net loss.  Year-to-date net
sales totaled $197.4 million in fiscal 2005 vs. $209.9 million in
fiscal 2004, a decrease of 6.0%.

Rick Walters, Executive Vice President and CFO, summarized
O'Sullivan's financial philosophy, "We will continue to keep a
very close watch over working capital items with special attention
being given to maintaining efficient inventory levels at all three
stages of production (raw materials, work-in-process, and finished
goods). In the last nine months inventory has been reduced by over
$14.8 million while maintaining outstanding customer service
levels.  Included in this reduction is about $4.8 million of
charges booked to increase inventory reserves as we have focused
on cleaning up our obsolete and excess inventory. Strong
relationships with vendors and customers have our accounts payable
and accounts receivable days also moving in positive directions.
Year-to-date SG&A expenses have increased only 1.8% when compared
to the same period last year in spite of substantial costs to
execute our corporate relocation and staff restructuring, which
will not repeat in fiscal 2006."

Mr. Walters concluded, "During the first half of fiscal 2005
O'Sullivan took great strides in reducing the amount of finished
goods inventory required to run our business. During the third
quarter we increased our visibility to better control and value
our raw material and work-in-process inventory. These actions,
along with closing down our Australian operations, are further
steps in executing the strategic plan that is focused on
generating profitable growth in the years ahead."

                     Conclusion and Outlook

"Bringing together a proven dynamic professional sales and
marketing organization with a focused strategic plan is continuing
to show positive market results," concluded Bob Parker. "Our
recent successful showing at the International Furniture Market at
High Point along with the celebration of our 50th Anniversary is
providing sustainable momentum for the future. However, financial
performance for the fourth quarter of fiscal 2005 will continue to
be a challenge compared to prior year results. Continuing to
execute our plan should result in increases in sales and earnings
in fiscal 2006."

At March 31, 2005, O'Sullivan Industries' balance sheet showed a
$197.5 million stockholders' deficit, compared to a $154 million
deficit at March 31, 2004.

                         *     *     *

As reported in the Troubled Company Reporter on Feb. 9, 2005,
Standard & Poor's Ratings Services lowered its ratings on
O'Sullivan Industries Holdings Inc., and on the company's wholly
owned operating subsidiary, O'Sullivan Industries Inc.,
including its corporate credit ratings to 'CCC+' from 'B-'.

S&P said the outlook is negative.  The furniture manufacturer's
total debt as of Dec. 31, 2004, was $222.6 million.

"The downgrade reflects continuing challenging operating
conditions and Standard & Poor's expectation that liquidity will
be weak relative to cash needs," said Standard & Poor's credit
analyst Martin Kounitz.


OCEAN CREST: Case Summary & 15 Largest Unsecured Creditors
----------------------------------------------------------
Debtor: Ocean Crest Seafoods, Inc.
        1900 West Nickerson Street, Suite 116-231
        Seattle, Washington 98119

Bankruptcy Case No.: 05-16189

Type of Business: The Debtor is a fish and seafood wholesaler.

Chapter 11 Petition Date: May 11, 2005

Court: Western District of Washington (Seattle)

Judge: Philip H. Brandt

Debtor's Counsel: Marc S. Stern, Esq.
                  Marc S. Stern
                  5610 20th Avenue Northwest
                  Seattle, Washington 98107
                  Tel: (206) 448-7996
                  Fax: (206) 784-8916

Total Assets: $1,200,000

Total Debts:  $531,581

Debtor's 15 Largest Unsecured Creditors:

   Entity                                   Claim Amount
   ------                                   ------------
Ocean Treasures, LLC                            $366,383
17607 66th Place West
Lynnwood, WA 98037

Cape Castle Holding                              $62,000
c/o Harold Holman
8698 Island Drive South
Seattle, WA 98118

New Star Seafoods                                $30,000
12505 Bellevue
Redmond Road, Suite 109
Bellevue, WA 98005

D & D Restaurant                                 $25,000
C/o Chrels M. Merriner
3934 Apollo Drive
Anchorage, AK 99504

Baxter Bruce and Sullivan                         $6,000
P.O. Box 32819
Juneau, AK 99803

Ballard Oil                                       $5,000
5300 26th Avenue Nothwest
Seattle, WA 98107

Charlie's Produce                                 $2,500
c/o Sullivan and Thoreson
701 Fifth Avenue, Suite 3470
Seattle, WA 98104

Poseidon Insurance                                $2,200
4027 21st Avenue West, Suite 100
Seattle, WA 98199

Pacific Industrial Supply                         $2,190
c/o Helm, Helm & Lovejoy
10734 Lake City Way Northeast
Seattle, WA 98125

Cathy Stevens Accounting                          $1,700
316 Center Street
Kodiak, AK 99803

Bellingham Cold Storage                           $1,500
2825 Roeder Avenue
P.O. Box 895
Bellingham, WA 78227

Ricky and Associates                              $1,500
P.O. Box 20330
Juneau, AK 99802

Port of Seattle                                   $1,100
P.O. Box 34249
Seattle, WA 98124

Wireless Matrix Telephone                         $1,070
27th Avenue Northeast, Suite 102
Calgary, Alberta T2E756 Canada

Kodiak Service, Inc.                                $604
P.O. Box 1018
Kodiak, AK 99617


OCEANVIEW CBO: Fitch Places $18 Million Notes on Watch Negative
---------------------------------------------------------------
Fitch Ratings placed four classes of notes issued by Oceanview
CBO I Ltd. on Rating Watch Negative this week:

    -- $28,000,000 class A-2 notes rated 'A';

    -- $10,411,500 class B-F notes rated 'BB';

    -- $5,110,817 class B-V notes rated 'BB';

    -- $2,694,508 class C notes rated 'CCC+'.

Oceanview is a collateralized debt obligation managed by Deerfield
Capital Management which closed June 27, 2002.  Oceanview is
composed of residential mortgage-backed securities, CDOs,
commercial mortgage-backed securities, asset-backed securities,
corporate debt and real estate investment trusts.

Since the last rating action in September 2004, the collateral
quality has deteriorated.  The class A-1 overcollateralization
ratio, class A-2 OC ratio and class B OC ratio have decreased from
112.95%, 104.47% and 100.43%, respectively, to 110.37%, 101.85%
and 97.67% as of the most recent trustee report dated March 31,
2005.  The class A-1 and A-2 OC ratios continue to pass their
respective test levels while the class B OC ratio has been failing
since June 30, 2004.  Additionally, the class A-2 interest
coverage test was failing on the Dec. 10, 2004 determination date
causing the class B notes to miss their coupon payment.

The deteriorating credit quality of the portfolio has increased
the credit risk of this transaction to the point the risk may no
longer be consistent with the ratings.  Fitch will review this
transaction and take appropriate rating action upon completion of
its analysis.


OMNI ENERGY: Auditors Express Going Concern Doubt
-------------------------------------------------
Omni Energy Services Corp.'s (Nasdaq: OMNI) independent registered
public accounting firm, Pannell Kerr Forster of Texas, P.C.,
questions the company's ability to continue as a going concern
after auditing the Company's financial statements for the fiscal
year ended Dec. 31, 2004.  The auditors point to the Company's
significant operating losses reported in fiscal 2004, the current
default with respect to certain Company debt, and a lack of
external financing to fund working capital and debt requirements.

The Company is in the process of securing financing from
prospective investors, that if successful, will refinance the
current debt service obligations, and in conjunction with cash
flows from operations and sales of certain non-core assets, will
serve to mitigate the factors that have raised doubt about the
Company's ability to continue as a going concern.

Headquartered in Carencro, Louisiana, OMNI Energy offers a broad
range of integrated services to geophysical companies engaged in
the acquisition of on- shore seismic data and through its aviation
division, transportation services to oil and gas companies
operating in the shallow, offshore waters of the Gulf of Mexico.
The Company provides its services through several business units:
Seismic Drilling, Aviation Transportation and Environmental
Services.  OMNI's services play a significant role with
geophysical companies who have operations in marsh, swamp, shallow
water and the U.S. Gulf Coast also called transition zones and
contiguous dry land areas also called highland zones.

                         *     *     *

As reported in the Troubled Company Reporter on April 27, 2005,
OMNI Energy Services Corp. reported a net loss in its 2004
results despite a 44% increase in revenues over the same year
ended December 31, 2003.  The Company said that after taking $7.8
million of accounting charges, including:

   -- $4.2 million of impairment charges recorded as a part of the
      restructuring of its aviation division;

   -- $2.0 million of non-cash accounting charges related to the
      issuance and redemption of a portion of the Company's 6.5%
      Subordinated Convertible Debentures; and

   -- $2.1 million in other charges, including $0.5 million of
      preferred stock dividends,

it reported a net loss from continuing operations of $11.2 million
for the year ended December 31, 2004.  After a  $3.1 million
charge taken in connection with discontinuing a segment of its
aviation operations, the Company reported a net loss available to
common stockholders of $14.7 million on revenues of $51.6 million
for year ended December 31, 2004.


OMNI ENERGY: Extends Bridge Loan Maturity with Beal Bank to May 31
------------------------------------------------------------------
OMNI Energy Services Corp., (NASDAQ NM: OMNI), American
Helicopters Inc., OMNI Energy Services Corp.-Mexico, Trussco,
Inc., and Trussco Properties, LLC, entered into a Second Amendment
to a Forbearance Agreement with Beal Bank, SSB, extending the
maturity date of its bridge loan with Beal Bank, N.A., to May 31,
2005.  There are no other changes to the bridge loan agreement.
The Company did not incur any penalties in connection with the
renegotiation of the maturity date.

Headquartered in Carencro, Louisiana, OMNI Energy offers a broad
range of integrated services to geophysical companies engaged in
the acquisition of on- shore seismic data and through its aviation
division, transportation services to oil and gas companies
operating in the shallow, offshore waters of the Gulf of Mexico.
The Company provides its services through several business units:
Seismic Drilling, Aviation Transportation and Environmental
Services.  OMNI's services play a significant role with
geophysical companies who have operations in marsh, swamp, shallow
water and the U.S. Gulf Coast also called transition zones and
contiguous dry land areas also called highland zones.

                         *     *     *

As reported in the Troubled Company Reporter on April 27, 2005,
OMNI Energy Services Corp. reported a net loss in its 2004
results despite a 44% increase in revenues over the same year
ended December 31, 2003.  The Company said that after taking $7.8
million of accounting charges, including:

   -- $4.2 million of impairment charges recorded as a part of the
      restructuring of its aviation division;

   -- $2.0 million of non-cash accounting charges related to the
      issuance and redemption of a portion of the Company's 6.5%
      Subordinated Convertible Debentures; and

   -- $2.1 million in other charges, including $0.5 million of
      preferred stock dividends,

it reported a net loss from continuing operations of $11.2 million
for the year ended December 31, 2004.  After a  $3.1 million
charge taken in connection with discontinuing a segment of its
aviation operations, the Company reported a net loss available to
common stockholders of $14.7 million on revenues of $51.6 million
for year ended December 31, 2004.


OREGON STEEL: Good Performance Prompts S&P to Lift Ratings
----------------------------------------------------------
Standard & Poor's Ratings Services raised its corporate credit and
$305 million first-mortgage notes ratings on Oregon Steel Mills
Inc. to 'B+' from 'B'.  At the same time, Standard & Poor's
withdrew its rating on the company's $65 million revolving credit
facility due June 2005, as the company terminated this facility.
The Portland, Oregon-based company has about $320 million in total
debt.  The outlook is stable.

"The upgrade of Oregon Steel reflects the expectation that the
company will generate meaningful levels of cash over the next
year, because of continued favorable fundamentals in its plate,
rail and pipe markets, depletion of its high inventory levels, and
the sale of its Napa pipe mill assets, and apply its cash balances
toward buying back a meaningful portion of its bonds, which become
callable July 2006," said Standard & Poor's credit analyst Paul
Vastola.

Subsequently, OSM is expected to continue to operate the company
with a more moderate capital structure.

Although the company's credit measures may be strong for the
ratings in the intermediate term, further improvement in the
ratings is tempered by the volatility associated with the
company's operations.  Ratings on OSM could be revised downwards
if the company fails to meet its debt-reduction expectations.

OSM primarily competes in markets west of the Mississippi River
and in Western Canada, where there are fewer competitors,
providing a transportation cost advantage relative to Eastern
producers.  Although its product mix and customer base are
somewhat varied, the company is only modestly insulated during
periods of economic distress, as most of its markets are tied to
similar end markets.  OSM is also exposed to fluctuations in the
price of energy, as well as steel scrap and slab--critical raw
materials, which, although currently at high levels, are being
offset by high selling prices.


OWENS CORNING: Battle Brews Over Three Property Damage Claims
-------------------------------------------------------------
In December 2004, Owens Corning and its debtor-affiliates filed
objections to Garrison Public School District #51's asbestos
property damage claims.  Garrison is a public school district
located in Garrison, North Dakota.  Speights & Runyan is the
counsel for Garrison.

Daniel A. Speights, Esq., at Speights & Runyan, in Hampton, South
Carolina, stated that contrary to the Court's earlier suggestion
that dispositive motions should be filed after discovery, the
Debtors included "Initial Objections" to Garrison's Claim Nos.
8783 and 8926, which the Debtors submit, "the Court can and should
resolve as a matter of law based on the undisputed evidence
already available."  The primary basis of the Debtors' Initial
Objections is that Garrison's Claims are time barred.

According to Mr. Speights, the Debtors face a "substantial if not
insurmountable hurdle" to prevail as a matter of law under
prevailing applicable authorities:

    * Tioga Public School #15 of Williams County, State of North
      Dakota v. United States Gypsum Company, 984 F.2d 915 (8th
      Cir. 1993);

    * Montana-Dakota Utilities Co. v. W.R. Grace & Co., 14 F.3d
      1274 (8th Cir. 1994); and

    * Hebron Public School District of Morton County v. United
      States Gypsum Co., 475 N.W.2d.120 (N.D. 1991).

                 Claimants Argue Against Dismissal

Garrison Public School District, Kindred Public School District
and the State of North Dakota argued that their claims should not
be dismissed because:

    (a) their claims are not barred by Section 28-01-47(2) North
        Dakota Century Code; and

    (b) based on the MDU Resources Group v. W.R. Grace & Co., 14
        F.3d 1274 (8th Cir. 1994) case, there is no evidence that
        they knew or should have known of any asbestos
        contamination in their buildings, which would trigger
        North Dakota's six-year statute of limitations.

The State of North Dakota holds Claim Nos. 8774 and 8922, the
Kindred Public School District asserts Claim No. 8886, and
Garrison Public School filed Claim Nos. 8783 and 8926.

                 Owens Corning Says They're Wrong

J. Kate Stickles, Esq., at Saul Ewing LLP, in Wilmington,
Delaware, asserts that the Claimants' arguments are wrong for
three reasons:

    (1) Section 28-01-47(2) is clear on its face and unambiguously
        prohibits all property damage claims from public buildings
        after August 1, 1997;

    (2) The legislative history supports barring any claims by
        public buildings after that date; and

    (3) The MDU Resources case is not applicable to owners of
        public buildings.

Section 28-01-47(2) is an unambiguous statute that requires
owners of public buildings to bring any action to recover costs
for asbestos property damage before August 1, 1997, Ms. Stickles
relates.  "It is fundamental that, when a statute is unambiguous
on its face, courts do not consult its legislative history to
elucidate its meaning."  Because there is no ambiguity in the
language of Section 28-01-47, Ms. Stickles believes that the
Court should not consult the legislative history to interpret it,
and should interpret it as written.

According to Ms. Stickles, the North Dakota Legislature clearly
expressed that it was in the interest of plaintiffs and
defendants to set a "specific date" by which actions "associated
with the presence of asbestos" in public buildings must be
brought.  "No exemption is made for buildings with asbestos that
has not yet been discovered, or buildings with asbestos that is
not friable, or any other possible fact patterns."  Thus, Ms.
Stickles says, the language of the statute allows only one
interpretation: asbestos property damage claims on behalf of
owners of public buildings had to be brought by August 1, 1997.
Because the North Dakota claims all relate to public buildings
yet were not brought until 2002, they are barred, Ms. Stickles
contends.

Ms. Stickles asserts that the North Dakota Legislature intended
Section 28-01-47(2) to apply to all present and future actions by
owners of public buildings for asbestos property damage.  Ms.
Stickles relates that North Dakota Legislature passed the statute
with the intent that:

    (1) it would promote public health by encouraging prompt
        discovery and abatement of asbestos problems in public
        buildings;

    (2) it would establish an absolute cutoff date for litigation
        by public entities over asbestos property damage claims;
        and

    (3) it would eliminate litigation over application of the
        "discovery" rule.

Contrary to the North Dakota Claimants' argument, MDU Resources
Group v. W.R. Grace & Co., 14 F.3d 1274 (8th Cir. 1994) does not
control their claims, Ms. Stickles argues.  The MDU case, Ms.
Stickles points out, involved a private building, not a public
one, and the Eighth Circuit did not interpret, or even mention,
Section 28-01-47.

Additionally, Ms. Stickles continues, the Claimants' arguments
about the "accrual" theory based on case law from Missouri and
California are misplaced because North Dakota law, not the law of
another state, controls the claims.

For these reasons, Owens Corning and Fibreboard ask the Court to
disallow and expunge the claims filed by Garrison Public School
District, Kindred Public School District and the State of North
Dakota.

Headquartered in Toledo, Ohio, Owens Corning --
http://www.owenscorning.com/-- manufactures fiberglass
insulation, roofing materials, vinyl windows and siding, patio
doors, rain gutters and downspouts.  The Company filed for chapter
11 protection on October 5, 2000 (Bankr. Del. Case. No. 00-03837).
Mark S. Chehi, Esq., at Skadden, Arps, Slate, Meagher & Flom,
represents the Debtors in their restructuring efforts.  At Sept.
30, 2004, the Company's balance sheet shows $7.5 billion in assets
and a $4.2 billion stockholders' deficit.  The company reported
$132 million of net income in the nine-month period ending Sept.
30, 2004.  (Owens Corning Bankruptcy News, Issue No. 106;
Bankruptcy Creditors' Service, Inc., 215/945-7000)


PACIFIC MAGTRON: Case Summary & 55 Largest Unsecured Creditors
--------------------------------------------------------------
Lead Debtor: Pacific Magtron International Corporation
             1600 California Circle
             Milpitas, California 95035

Bankruptcy Case No.: 05-14326

Debtor affiliates filing separate chapter 11 petitions:

      Entity                                     Case No.
      ------                                     --------
      Pacific Magtron Inc.                       05-14331
      Pacific Magtron (GA), Inc.                 05-14335
      LiveWarehouse Inc.                         05-14339

Type of Business: Pacific Magtron International distributes some
                  1,800 computer hardware, software, peripheral,
                  and accessory items that it buys directly from
                  30 manufacturers like Creative Labs, Logitech,
                  and Yamaha.  Pacific Magtron sold the assets of
                  its Lea Publishing/LiveMarket subsidiary, which
                  offered software development and systems
                  integration services and supply chain
                  consulting, to the unit's employees, and the
                  sold assets of its FrontLine Network Consulting
                  subsidiary to KIS Computer Center.
                  See http://www.pacificmagtron.com/

Chapter 11 Petition Date: May 11, 2005

Court: District of Nevada (Las Vegas)

Judge: Linda B. Riegle

Debtors' Counsel: Lenard E. Schwartzer, Esq.
                  Schwartzer & Mcpherson Law Firm
                  2850 South Jones Boulevard, Suite 1
                  Las Vegas, Nevada 89146
                  Tel: (702) 228-7590
                  Fax: (702) 892-0122

Consolidated Financial Condition as of December 31, 2004:

      Total Assets: $11,740,700

      Total Debts:  $11,105,200

A.  Pacific Magtron International Corporation's 13 Largest
    Unsecured Creditors:

   Entity                     Nature Of Claim       Claim Amount
   ------                     ---------------       ------------
Weinberg & Company                                       $27,262
6100 Glades Road, Suite 314
Boca Raton, FL 33434

Quarles & Brady                                          $20,514
One Renaissance Square
Two North Central Avenue
Phoenix, AZ 85004

KPMG                                                     $15,000
500 East Middlefield Road
Mountain View, CA 94043

Wells Fargo Visa              Business Expense            $1,269
P.O. Box 29486
Phoenix, AZ 85038

Bonnet Bonnett, Fairbourn,    Business Expense              $657
Fri, Friedman, et al.

Shell Fleet                   Business Expense              $428

ADP Investor Communication    Business Expense              $167

Network Financial Printing    Business Expense              $145

Vintage Filings               Business Expense              $125

Cusip Service Bureau          Business Expense              $100

SBC                           Business Expense               $69

AT&T                          Business Expense               $24

Colonial Stock Transfer       Business Expense               $15
Services


B. Pacific Magtron Inc.'s 20 Largest Unsecured Creditors:

   Entity                     Nature Of Claim       Claim Amount
   ------                     ---------------       ------------
Ingram Micro                  Business Expense          $273,205
1000 West Temple Street
Los Angeles, CA 90012

Kingston                      Business Expense          $139,540
17600 Newhope Street
Fountain Valley, CA 92708

McAfee                        Business Expense           $87,500
135 South LaSalle
Department 1729
Chicago, IL 60674

AG Neovo                      Business Expense           $75,703
2362 Qume Drive, Suite A
San Jose, CA 95131

AT Distribution               Business Expense           $74,284

Roxio                         Business Expense           $70,671

MicroLand                     Business Expense           $63,666

Viva                          Business Expense           $63,590

Platinum Micro                Business Expense           $61,795

Innocom                       Business Expense           $61,360

The Hartford                  Business Expense           $40,364

Winnow                        Business Expense           $38,903

SonicBlue                     Business Expense           $33,664

Avus                          Business Expense           $33,050

Sourcenet                     Business Expense           $28,440

Chaintech America             Business Expense           $27,006

D&M Distributing              Business Expense           $26,082

Tech Data                     Business Expense           $23,917

Pennbrook Insurance Service   Business Expense           $21,169

CNET                          Business Expense           $14,897


C.  Pacific Magtron (GA), Inc.'s 20 Largest Unsecured Creditors:

   Entity                     Nature Of Claim       Claim Amount
   ------                     ---------------       ------------
PCChips USA Inc.              Business Expense           $25,470
44150 South Grimmer Boulevard
Fremont, CA 94538

Chaintech America Corp.       Business Expense           $22,086
4427 Enterprise Street
Fremont, CA 94538

Maxgroup                      Business Expense           $18,385
1855-D Beaver Ridge Circle
Norcross, GA 30071

Harma Technology              Business Expense           $17,352
Company Ltd.
167 Mason Way #A5
City of Industry, CA 91746

Avnet                         Business Expense           $15,930

Compucase Corporation         Business Expense           $14,454

Wintec Industries             Business Expense           $10,316

Highwoods Realty Ltd.         Business Expense            $6,360

Am-Can Transport Service      Business Expense            $4,367

Eastern Data Inc.             Business Expense            $3,250

Kent H. Landsberg Company     Business Expense            $2,313

AOC Alpha & Omega Computer    Business Expense            $2,047

United Parcel Service         Business Expense            $2,012

Ablerex Electronics LLC       Business Expense            $1,756

R&L Carriers Inc.             Business Expense            $1,744

Cybertest                     Business Expense            $1,260

Cbeyond Communications        Business Expense            $1,232

McCaltek                      Business Expense            $1,115

Shell Energy Services         Business Expense              $984

Leadman Electronics GA        Business Expense              $838


D.  LiveWarehouse Inc.'s 2 Largest Unsecured Creditors:

   Entity                     Nature Of Claim       Claim Amount
   ------                     ---------------       ------------
Federal Express               Business Expense              $655
P.O. Box 7221
Pasadena, CA 91109

United Parcel Service         Business Expense              $380
P.O. Box 650580
Dallas, TX 75265


PEGASUS SATELLITE: Gets Court Nod to Dispose De Minimis Assets
--------------------------------------------------------------
As previously reported, Pegasus Satellite Communications, Inc.
want to abandon certain personal property and sell certain de
minimis assets outside the ordinary course of business, free and
clear of liens, claims, interests and encumbrances.

                            Abandonment

The Debtors have determined that the Tradeshow Items and the
Intrepid are of inconsequential value or are burdensome to their
estates.

Accordingly, the Debtors seek the United States Bankruptcy Court
for the District of Maine's authority to abandon the Tradeshow
Items to Czarnowski Exhibit Service, a warehouse company that has
agreed to take charge of the Tradeshow Items and dispose of any
Tradeshow Items located at that certain storage facility in Las
Vegas.  Czarnowski Exhibit Service has estimated it will cost
$1,728 to take charge of and dispose of, as needed, the Tradeshow
Items currently stored at the Las Vegas Facility.

By abandoning the Tradeshow Items, the Debtors will save $3,600
per quarter in storage fees that they otherwise would have
incurred and which are currently being incurred each quarter to
store the Tradeshow Items.

The Intrepid was previously utilized by the Debtors in their
former DBS business.  As the Intrepid is located in an area where
the Debtors no longer have operations or personnel, the Debtors
will save money by abandoning the Intrepid rather than continuing
to be financially responsible for the Intrepid.

Accordingly, the Debtors seek the Court's authority to abandon the
Intrepid and transfer title to Ed Hautman, a former employee of
the Debtors.  The Intrepid has 123,000 miles on it and is in need
of repairs.  The Intrepid is currently in Mr. Hautman's
possession, and he has agreed to waive any past due storage fees
as well as costs or expenses incurred by him to remove or dispose
of the Intrepid.  In addition, Mr. Hautman will have no claim
against any of the Debtors for any costs or expenses related to
the removal or disposal of the Intrepid.

At the Debtor's behest, the Court approved the motion.

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. Maine 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. 24; Bankruptcy Creditors' Service, Inc., 215/945-7000)


PRIMEDIA INC: Earns $365.5 Million of Net Income in First Quarter
-----------------------------------------------------------------
PRIMEDIA Inc. (NYSE: PRM) reported revenue of $304 million for the
first quarter 2005, down 0.7% versus 2004.  Total Segment EBITDA
declined 9.6% to $42.6 million in the first quarter.  These
declines are primarily due to softness in three of Enthusiast
Media's eleven categories, a timing change in a Business
Information trade show, the impact of previously announced
investment expenses in the Consumer Guides segment, and paper
price increases.  First quarter net income is $365.5 million,
compared to $11.1 million in the same period last year.

Operating income was $29.4 million in the first quarter, up 26.2%,
compared to $23.3 million in the same period of 2004.  The
increase was due primarily to lower depreciation, amortization,
non-cash compensation, restructuring related expenses, and
provision for unclaimed property, partially offset by lower
Segment EBITDA.  Income applicable to common shareholders was
$365.5 million in the first quarter, compared to $5.9 million in
the same period of 2004. The increase was due primarily to the net
gain on sales of About, Inc. of $378.9 million and PRIMEDIA
Workplace Learning (PWPL) of $4.3 million.

The Company's historical pattern is to have negative free cash
flow in the first half of the year and positive free cash flow in
the second half. Free cash flow in the quarter was negative $3.4
million compared to negative $40.5 million in the same period one
year ago, primarily the result of improved accounts receivable
collection and the timing related to compensation payments. The
Company expects that after completing its redemption of certain
preferred stock and debt as announced April 11, 2005, free cash
flow will be positively affected by over $27 million on an
annualized basis. The Company will not realize the full benefit of
this savings in 2005.

"Our first quarter results contain numerous examples of the
effectiveness of our operating strategy, with success from new
product introductions, redesigned publications, and brand
extensions," said Kelly P. Conlin, President and CEO of PRIMEDIA
Inc.  "We are extremely focused on those businesses where revenue
declined during the quarter, applying specific action plans that
will allow those businesses to contribute positively to our
results in the future."

As of March 31, 2005, the Company had approximately $750 million
in cash and available unused credit lines. Giving effect to the
redemption of certain preferred stock and senior notes on May 11,
2005 and the reduction of its bank debt, cash and available unused
credit lines would be approximately $342 million. These reductions
will further improve the Company's maturity profile, and reduce
the Company's blended cost of debt and preferred to 7.4%.

"Since September 30, 2001, PRIMEDIA will have reduced its debt and
preferred stock by nearly $1 billion, and improved its multiple of
debt and preferred stock less cash, to last twelve months' Segment
EBITDA to 7.0 times, after giving affect to the redemptions that
will occur on May 11, 2005," said Matthew A. Flynn, Senior Vice
President, CFO, and Treasurer of PRIMEDIA Inc. Following the
Company's recent call to redeem certain debt and preferred stock,
of which the two preferred stock instruments called are the
Company's highest cost financial obligations, Moody's upgraded its
ratings on all of PRIMEDIA's senior notes from B3 to B2.

"Our financial strength has dramatically improved in recent years
and has been enhanced with the sale of About.com. The Company has
more than adequate resources to finance the implementation of its
operating strategy and growth initiatives and we remain committed
to delivering a balance of operating growth and leverage reduction
on an ongoing basis," Mr. Flynn added.

                       Segment Results

Enthusiast Media (Includes Consumer Automotive, Performance
Automotive, International Automotive, Outdoors, Action Sports,
Marine, Soaps, Equine, History, Crafts, Home Technology, their
related websites, events, licensing and merchandising)

The first quarter decline in Enthusiast Media revenue is
attributable to softness isolated to three of the segment's eleven
categories, specifically Consumer Automotive, International
Automotive, and Soaps, which together comprise about 28% of the
segment's revenue.

The Segment EBITDA decline is primarily due to lower revenue and
the impact of previously announced paper price increases,
primarily offset by lower operating expenses.

Consumer Automotive's first quarter revenue decline is
attributable to a slow start by auto manufacturers experiencing
difficult business conditions, the timing of new product
introductions toward the second half of the year, and the full
impact of the rate base reduction that was implemented in the
first quarter of last year. Advertising accelerated in Consumer
Automotive at the start of the second quarter and the Company
believes that this category will deliver revenue growth throughout
the remainder of 2005.

The first quarter revenue decline in the segment's International
Automotive category follows a sharp decline in the fourth quarter
of last year after several years of strong growth. The category is
expected to decline for the full year, as the market currently
suffers from the absence of any new 'tuner' platforms and a
consolidation of aftermarket suppliers. In the fourth quarter of
this year, Honda is expected to announce its new Civic Si, a
platform that has the potential to be a catalyst for market
growth. While the market is down, PRIMEDIA maintains wide
leadership in market share, carrying about three quarters of the
sector's advertising pages and selling about 70% of the sector's
newsstand copies. The category will continue to be a profitable
business for the Company.

Two of the segment's eleven categories comprised nearly all of the
circulation decline: the International Automotive category and the
Soaps category. The Soaps category has been affected by reduced
viewership of soap operas, and, in the first quarter, the timing
of circulation rack expenses. To address the decline, the Company
is eliminating inefficient distribution points and building retail
promotions with leading retailers such as Wal-Mart.

"Reflecting continued progress in the execution of the Company's
operating strategies, revenue grew in our two largest categories,
Performance Automotive and Outdoor, compared with declines in
these categories in the first quarter last year," said Conlin.
"Our third largest category, Consumer Automotive, is on track for
growth this year despite a difficult first quarter. Our biggest
challenges in the segment are in our International Automotive and
Soaps categories, which we are diligently addressing."

Other revenue benefited from the continued strong growth in
licensing and merchandising, but was adversely affected by the
cancellation in 2005 of marginally profitable events that were
held in the first quarter of 2004.

      Provision for Severance, Closures, and Restructuring

The Company recorded a provision of approximately $1.1 million in
first quarter 2005, compared to $2.5 million in the same period
last year. The $1.4 million decrease was due primarily to a
reduction in transactions relating to excess real estate.

                   Discontinued Operations

On March 18, 2005, the Company sold About, Inc., part of the
Enthusiast Media segment, for $410 million, resulting in a net
gain of $378.9 million. The operating results of About, Inc. have
been classified as a discontinued operation for all periods
presented.

On March 31, 2005, the Company sold Bankers Training & Consulting
Company, a division of PWPL, for $21.3 million, resulting in a net
gain of $18.7 million. On April 1, 2005, the Company sold the
remaining net assets of PWPL for the assumption of liabilities,
resulting in a loss in carrying value of $14.4 million. In
accordance with Statement of Financial Accounting Standards 144,
"Accounting for the Impairment or Disposal of Long-Lived Assets",
the Company recorded, as of March 31, 2005, the loss in the
carrying value of the remaining net assets of PWPL sold on April
1, 2005. PWPL, excluding IMN, was classified as a discontinued
operation in 2004.

The aggregate net gain on the above transactions recorded in first
quarter 2005 was $383.2 million.

           Call of Preferred Stock and Debt for Redemption

On April 11, 2005, the Company disclosed that it was calling for
redemption all of its outstanding shares of $10.00 Series D
Preferred Stock (with an aggregate liquidation preference of
approximately $167 million), all of its outstanding shares of
$9.20 Series F Preferred Stock (with an aggregate liquidation
preference of approximately $96 million) and $80 million aggregate
principal amount of its 7 5/8% Senior Notes due 2008. The
redemption date in each case is May 11, 2005.

In connection with the redemption of the Series D and Series F
Preferred Stock, the Company obtained the written consent of its
bank lenders and has repaid its outstanding Term Loans A and Term
Loans B in aggregate principal amounts of $5 million and $35
million, respectively, and permanently reduced its total revolving
loan commitments in an aggregate amount of $30 million.

                     Liquidity and Leverage

The Company has more than adequate financial resources to meet its
cash needs and service its debt and other fixed obligations for
the foreseeable future. Giving effect to the redemption of certain
preferred stock and senior notes on May 11, 2005 and the reduction
of its bank debt, cash and available unused credit lines would be
approximately $342 million. Free cash flow was negative $3.4
million compared to negative $40.5 million last year.

The leverage ratio, as defined by the Company's credit agreements,
for the 12 months ended March 31, 2005, is estimated to be
approximately 4.5 times versus the permitted maximum of 6.25
times.

                        About the Company

PRIMEDIA is the leading targeted media company in the United
States.  With 2004 revenue of $1.3 billion, its properties
comprise more than 200 brands that connect buyers and sellers in
more markets than any other media Company through print
publications, websites, events, newsletters and video programs in
four market segments:

   -- Enthusiast Media includes more than 120 consumer magazines,
      115 websites, 100 events, 10 TV programs, 340 branded
      products, and is the #1 special interest magazine publisher
      in the U.S. with well-known brands such as Motor Trend,
      Automobile, Creating Keepsakes, In-Fisherman, Power &
      Motoryacht, Hot Rod, Snowboarder, Stereophile and Surfer.

   -- Consumer Guides is the #1 publisher and distributor of free
      consumer guides in the U.S. with Apartment Guide, Auto Guide
      and New Home Guide, distributing free consumer publications
      through its proprietary distribution network, DistribuTech,
      in more than 16,000 locations.

   -- Business Information is a leading information provider in
      more than 18 business market sectors with more than 70
      magazines, 100 websites, 25 events, and 50 directories and
      data products.

   -- Education includes Channel One, a proprietary network to
      secondary schools; Films Media Group, a leading source of
      educational videos; and Interactive Medical Network, a
      continuing medical education business.


http://www.hoovers.com/free/news/detail.xhtml?ArticleID=NR20050505290.2_70f0072acc7992f6

                        *     *     *

As reported in the Troubled Company Reporter on April 13, 2005,
Moody's Investors Service upgraded the ratings of PRIMEDIA Inc.
Details of the rating action are:

Ratings upgraded:

   * $300 million of 8.0% senior notes due 2013 -- to B2 from B3

   * $470 million of 8.875% senior notes due 2011 -- to B2 from B3

   * $226 million of 7.625% senior notes due 2008 -- to B2 from B3

   * $175 million of floating rate notes due 2010 -- to B2 from B3

   * $211 million of series H 8.625% exchangeable preferred stock
     due 2010-- to Caa2 from Ca

   * Senior implied rating -- to B2 from B3

   * Senior unsecured issuer rating -- to Caa1 from Caa2

Rating affirmed:

   * Speculative grade liquidity rating -- SGL-3

Ratings withdrawn:

   * $168 million of series D 10.0% exchangeable preferred stock
     due 2008

   * $96 million of series F 9.2% exchangeable preferred stock
     due 2009

Moody's said the rating outlook is stable.


PRIMUS TELECOM: Faltering Performance Cues Moody's to Junk Ratings
------------------------------------------------------------------
Moody's Investors Service downgraded the senior implied rating of
Primus Telecommunications Group Inc. to Caa1 from B3.  The ratings
downgrade reflects faltering performance and high and increasing
leverage.

Additionally, Moody's has downgraded PTGI's 12.75% senior notes to
Caa3 from Caa2, the 5.75% convertible subordinated debentures to
Ca from Caa3, and the 8% senior notes of Primus Telecommunications
Holdings Inc.'s, a subsidiary of Primus, to Caa1 from B3.  Moody's
has changed the outlook to negative from stable.

Moody's has downgraded these PTGI ratings:

   * Senior Implied -- to Caa1 from B3

   * Issuer rating -- to Caa3 from Caa2

   * $83 million 12.75% Global Senior Notes due 2009 -- to Caa3
     from Caa2

   * $67 million 5.75% Convertible Subordinated Debentures due
     2007 -- to Ca from Caa3

Moody's has downgraded this PTHI rating:

   * $235 million 8.0% Senior Notes due 2014 -- to Caa1 from B3

Moody's has affirmed these PTHI rating:

   * $100 million Senior Secured Term Loan maturing 2011 -- B3

The outlook for all ratings is negative.

Moody's downgrade of Primus's senior implied rating reflects:

   (1) Primus' high and increasing pro forma total leverage (5.5x
       TTM as of Q1'05 - and expected to be in excess of 13x by
       the end of 2005 given the company's recent adjusted EBITDA
       guidance of $35-50 million for 2005),

   (2) thin (and declining) operating margins (7.4% EBITDA margin
       for the TTM months ended Q1'05, down 540 basis points Y-o-
       Y), and

   (3) competitive pressures from better capitalized incumbent
       operators.

While the company is currently undertaking various domestic and
international growth initiatives, and Moody's had expected higher
expenses and lower EBITDA margins associated with such
initiatives, Primus' core business remains focused on the most
commoditized sectors within the telecommunications business --
namely, the provisioning of domestic and international voice,
data, and dial-up Internet services to SMEs and residential
customers.  The company's lower than expected margins suggest that
the pace of such commoditization may be exceeding the rate at
which Primus can roll out growth initiatives.

Moody's believes Primus is especially susceptible to competitive
pressures from facilities-based telecom providers.  Nearer term,
Moody's believes that execution risk will increase as the company
realigns its product offerings within the marketplace.  However,
the company's geographic diversity (North America, Europe and
Asia-Pacific comprise 38%, 31% and 31% of revenues, respectively)
mitigates some of the heightened business risk by potentially
reducing the overall volatility of Primus's various cash flow
streams.  Should expected performance falter further, Primus's
$116 million in unrestricted cash is sufficient to fund the
company's interest expense and capex, approximately $26 million
per quarter in aggregate, into early 2006 -- without the benefit
of 2005 operating cash flow.

The negative rating outlook reflects faster than expected declines
within the company's core businesses (e.g. international and
domestic long distance, and dial-up Internet). Despite Moody's
view that growth initiatives (e.g. DSL, cellular resale, VoIP,
local and service bundling) are strategically sound, Moody's is
concerned that such growth initiatives may be unable to mitigate
top line, core business deterioration going forward.  Should
revenue and cash flow growth from new initiatives exceed core
business deterioration over the next several quarters, Moody's
could change the outlook to stable.

If the company were to meet or exceed expectations with respect to
revenue growth (e.g. greater than 5% per year), EBITDA margins
(i.e. greater than 15%), or total leverage (e.g. less than 3.5x),
ratings could improve over time.  However, Moody's believes that
the company is highly dependent on the success of its new
initiatives in order to maintain and grow its existing revenue
base and improve currently nominal margins.  Should several of its
larger initiatives (e.g. Lingo, the company's U.S. VoIP service)
materially fail to meet expectations (i.e. slower sales growth,
lower margins); the company's ratings could come under further
pressure.  Given the preponderance of international operations and
revenues, Primus is also exposed to currency fluctuations.  While
Primus has benefited from such fluctuations as of late (though it
recorded a foreign currency translation loss in Q1'05),
particularly with respect to the Australian dollar and the Euro
versus the U.S. dollar, the company remains exposed given that its
debt is largely U.S. dollar denominated.

Moody's has downgraded all debt by one notch commensurate with the
one notch downgrade of the company's senior implied rating except
PTHI's $100 million secured bank facility.  The bank debt is
senior to nearly all of the company's debt.  Moody's is widening
the ratings notching given the range of recovery prospects for the
different debt classes.  Moody's believes that the bank debt has
enhanced recovery prospects relative to the rest of the company's
debt, the B3 rating indicating a likelihood of full recovery.

The downgrade of the PTGI 12.75% senior notes to Caa3 from Caa2
reflects their structural subordination to the debt at PTHI and
the absence of upstream and downstream guarantees (i.e. relative
to the 8% notes at PTHI, which benefit from upstream and parental
guarantees).

The downgrade of the PTGI 5.75% convertible subordinated
debentures to Ca from Caa3 reflects their contractual
subordination to the 12.75% senior notes.

The downgrade of the 8% senior notes at PTHI to Caa1 from B3
reflects:

   (1) their subordinate position to the $100 million B3-rated
       term loan due to the latter being secured by the assets of
       PTHI's domestic subsidiaries,

   (2) a pledge of the capital stock of PTGI's domestic
       subsidiaries, and

   (3) 65% of the voting stock of foreign subsidiaries directly
       owned by PTGI or a domestic subsidiary of PTGI.

The PTHI notes' Caa1 rating also reflects its structural
seniority to the aforementioned PTGI 12.75% senior notes and the
5.75% convertible subordinated debentures.

Primus Telecommunications, a global facilities-based
telecommunications service provider with operations in the USA,
Canada, Australia and Europe, recorded sales of approximately
$1.32 billion for the last twelve months ended March 31, 2005.
The company is headquartered in McLean, Virginia.


PROXIM CORP: Needs to Secure Financing to Avert Bankruptcy Filing
-----------------------------------------------------------------
Proxim Corporation (Nasdaq: PROX), a provider of wireless
networking equipment for Wi-Fi and broadband wireless, today
announced unaudited financial results for the first quarter ended
April 1, 2005. Revenue for the first quarter of 2005 was $25.4
million.

This compares with revenue of $24.1 million in the fourth quarter
of 2004, and $26.7 million for the first quarter of 2004. The net
loss attributable to common stockholders computed in accordance
with generally accepted accounting principles (GAAP) for the first
quarter of 2005 was $(7.8) million, or $(0.24) per common share.
This compares with a GAAP net loss of $( 67.7) million, or $(2.69)
per common share, in the preceding fourth quarter of 2004 and with
a GAAP net loss of $(17.5) million, or $(1.42) per common share,
in the first quarter of 2004.

The non-GAAP, or pro-forma net loss in the first quarter of 2005
was $(4.5) million, or $(0.14) per common share, compared to a
pro-forma net loss of $(7.6) million, or $(0.30) per common share,
in the fourth quarter of 2004, and a pro-forma net loss of $(5.1)
million, or $(0.41) per common share, in the first quarter of
2004.

A detailed and specific reconciliation of the differences between
the GAAP net loss and pro-forma net loss is included in the
accompanying financial table.

On January 27, 2005, the Company disclosed that it engaged Bear,
Stearns & Co. to explore strategic alternatives for the Company,
including capital raising and merger opportunities.  The Company
remains actively engaged with Bear, Stearns & Co. and is currently
in discussions with a potential third party purchaser.  There can
be no assurance that a transaction will occur and, if a
transaction occurred, there can be no assurance that any
consideration available to the holders of the Company's Class A
common stock would approach the current market trading value of
the Company's Common Stock given, among other factors, the
preferences held by senior equity and debt holders.

                       Bankruptcy Warning

The Company has an immediate need for additional financing.  If
the Company were not able to enter into an agreement with a third
party purchaser or able to obtain sufficient financing in the
second quarter of 2005, it would be required to seek protection
under applicable bankruptcy laws.

Proxim Corporation designs and sells wireless networking equipment
for Wi-Fi and broadband wireless networks.  The company is
providing its enterprise and service provider customers with
wireless solutions for the mobile enterprise, security and
surveillance, last mile access, voice and data backhaul, public
hot spots, and metropolitan area networks.  This press release and
more information about Proxim can be found on the Web at
http://www.proxim.com/

At Apr. 1, 2005, Proxim Corporation's balance sheet showed a
$46.4 million stockholders' deficit, compared to a $44.9 million
deficit at Dec. 31, 2004.


QUALITY DISTRIBUTION: March 31 Balance Sheet Upside-Down by $31MM
-----------------------------------------------------------------
Quality Distribution, Inc. (Nasdaq: QLTY) reported record total
revenue for the quarter ended March 31, 2005 of $161.1 million, a
6.6% increase over the prior year's first quarter revenues of
$151.2 million.  The increase in revenue has been driven primarily
by demand from existing customers, rate increases, and the impact
from new affiliates added during the preceding 12 months.

Commenting on the results and outlook, President and Chief
Executive Officer Tom Finkbiner said, "This marks the thirteenth
consecutive quarterly year-over-year increase in revenues.  We are
excited about the underlying trends in our business.  Demand
remains strong, and we are focusing on margin improvement through
rate increases and yield management.  We continue to pursue new
customers and affiliates aggressively.

Net income for the quarter was $2.9 million as compared to
$1.0 million in the first quarter last year, an increase of 203%.
Earnings per fully diluted share were $0.15 in the 1st quarter of
2005, compared to $0.05 per fully diluted share for the same
period last year.  During the quarter, the Company took a non-cash
charge of $1.1 million to write off deferred debt financing costs
related to the Company's issuance of $85 million of new Senior
Floating Rate Notes on January 28 of this year.  In addition, the
Company incurred $0.5 million of legal fees related to resolving
litigation and regulatory matters associated with its PPI
insurance operation.  Adjusting for these events, which are not
related to the Company's ongoing core trucking operations, and tax
affecting income before taxes at a 35% tax rate yields an adjusted
net income for the current quarter of $3.2 million or $0.17 per
fully diluted share as compared to adjusted net income of $2.8
million or $0.14 per fully diluted share calculated on a
comparable basis for the first quarter last year.  For more detail
regarding these adjustments please see the accompanying schedules.

The strong performance of our core trucking operations was offset
by a $2.1 million increase in professional fees as compared to
last year, primarily as a result of increases in audit, Sarbanes-
Oxley, tax and legal related expenses and by a $1.1 million
increase in interest expense as compared to last year.  "We are
monitoring spending for professional services closely and expect
them to decrease significantly in the coming quarters," said Tim
Page, Chief Financial Officer.

Headquartered in Tampa, Florida, Quality Distribution, Inc.
through its subsidiary, Quality Carriers, Inc., and TransPlastics,
a division of Quality Carriers, and through its affiliates and
owner-operators, manages approximately 3,500 tractors and 7,400
trailers.  The Company provides bulk transportation and related
services, including tank cleaning and freight brokerage.  Quality
Distribution is an American Chemistry Council Responsible Care(R)
Partner and is a core carrier for many of the Fortune 500
companies that are engaged in chemical production and processing.

At March 31, 2005, Quality Distribution's balance sheet showed a
$30,943,000 stockholders' deficit, compared to a $34,100,000
deficit at Dec. 31, 2004.


QWEST COMMUNICATIONS: Exchanging Private Debt with New Notes
------------------------------------------------------------
Qwest Communications International Inc. (NYSE:Q) commenced an
offer to exchange all of its privately placed outstanding:

   -- 7.25% notes due 2011,
   -- 7.5% notes due 2014, and
   -- floating rate notes due 2009,

for newly registered:

   -- 7.25% notes due 2011,
   -- 7.5% notes due 2014, and
   -- floating rate notes due 2009, respectively.

Qwest Services Corporation, a wholly owned subsidiary of Qwest,
also commenced an offer to exchange all of QSC's privately placed
outstanding:

   -- 13% notes due 2007,
   -- 13.5% notes due 2010, and
   -- 14% notes due 2014,

for newly registered:

   -- 13% notes due 2007,
   -- 13.5% notes due 2010, and
   -- 14% notes due 2014, respectively, to be issued by QSC.

The exchange offers, which are required by the registration rights
agreements for the outstanding notes, are being made pursuant to
prospectuses dated April 21, 2005.  Copies of the exchange-offer
prospectuses and related transmittal materials governing the
exchange offers are available from the exchange agent for the
offers, J. P. Morgan Trust Company, National Association, at:

      J. P. Morgan Trust Company,
      National Association Institutional Trust Services
      2001 Bryan Street, 9th Floor
      Dallas, TX 75201
      Attn: Frank Ivins
      Phone: (800) 275-2048

The terms of the new notes are substantially identical to the
terms of the outstanding notes, except that the new notes will be
registered under the Securities Act of 1933, as amended.  The
exchange offer for the QCII notes will expire at 5:00 p.m. EST on
June 9, 2005, unless extended.  The exchange offer for the QSC
notes will expire at 5:00 p.m. EST on June 10, 2005, unless
extended.

                         About the Company

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

At Dec. 31, 2004, Qwest Communications' balance sheet showed a
$2,612,000,000 stockholders' deficit, compared to a $1,016,000,00
deficit at Dec. 31, 2003.


QWEST COMMS: S&P Holds Low-B Ratings on Three Class Certificates
----------------------------------------------------------------
Standard & Poor's Ratings Services affirmed its ratings on three
synthetic transactions related to Qwest Communications
International Inc. and its related entities and removed them from
CreditWatch negative, where they were placed March 11, 2005.

The affirmations and CreditWatch removals reflect the May 3, 2005
affirmation of the long-term corporate credit rating on Qwest
Communications International Inc. and the senior unsecured debt
ratings on Qwest Communications International Inc. and its related
entities and their subsequent removal from CreditWatch negative.

PreferredPLUS Trust Series QWS-1 and PreferredPLUS Trust Series
QWS-2 are swap-independent synthetic transactions that are weak-
linked to the underlying securities, Qwest Capital Funding Inc.'s
(formerly U.S. West Capital Funding Inc.) 7.75% notes due Feb. 15,
2031.  The rating actions regarding these two transactions reflect
the current credit quality of the underlying securities issued by
Qwest Capital Funding Inc., which are guaranteed by Qwest
Communications International Inc.

CorTS Trust For U.S. West Communication Debentures is a swap-
independent synthetic transaction that is weak-linked to the
underlying securities, Qwest Corp.'s (formerly U.S. West
Communications Inc.) 7.125% debentures due Nov. 15, 2043.  The
rating action regarding this transaction reflects the current
credit quality of the underlying securities issued by Qwest Corp.

A copy of the Qwest Communications International Inc.-related
research update, dated May 3, 2005, is available on RatingsDirect,
Standard & Poor's Web-based credit analysis system at
http://www.ratingsdirect.com/

                    RATINGS AFFIRMED AND OFF CREDITWATCH

                      PreferredPLUS Trust Series QWS-1
                $40.565 million trust certificates series QWS-1

               Rating

                        Class       To          From
                        -----       --          ----
                        Certs       B           B/Watch Neg

                      PreferredPLUS Trust Series QWS-2
                $38.750 million trust certificates series QWS-2

               Rating

                        Class       To          From
                        -----       --          ----
                        Certs       B           B/Watch Neg

               CorTS Trust For U.S. West Communications Debentures
                $40.565 million corporate-backed trust securities

               Rating

                Class       To          From
                -----       --          ----
                Certs       BB-         BB-/Watch Neg


R.J. REYNOLDS: Moody's Sees Adequate Liquidity for Next 12 Months
-----------------------------------------------------------------
Moody's Investors Service assigned the speculative grade liquidity
rating of SGL-3 for R.J. Reynolds Tobacco Holdings, Inc.  The
SGL-3 rating reflects our expectation that RJR will maintain
adequate liquidity over the next twelve-month horizon ending March
31, 2006.

Moody's projects that over the next twelve months RJR will
generate cash flow from operations in the $725-$775 million range.
After approximately $150 million of capital expenditures and
$560 million in dividends, Moody's expect RJR to generate free
cash flow in the $15-$65 million range.  Operating cash flows
should benefit from merger-related synergies, continued positive
effects resulting from the cost reduction initiatives and
efficient implementation of RJR's new marketing strategy.  The
first quarter results for 2005 were encouraging but the
effectiveness and ability for the company to produce stable cash
flows at this level must be measured over several quarters at a
minimum.  The company faces declining volumes, the uncertain
effectiveness of its new marketing strategy and outstanding
litigation claims.  Some factors that could negatively affect cash
flows in the short-term are larger than expected one-time merger
costs, slower than anticipated returns from the new marketing
strategy in the form of stagnant market share of its investment
brands (Camel and Kool) or declining market share of its selective
support brands (Winston, Salem, Doral, Pall Mall), faster than
expected overall volume declines and smaller synergies from the
merger.

RJR has access to a $486 million revolving credit facility to
support ongoing working capital and general corporate purpose
needs.  The company also had cash on hand of $2.0 billion as of
December 31, 2004 and Moody's expects cash to be approximately the
same at the end of 2005. At December 31, 2004, RJR had $29 million
in letters of credit outstanding under the facility. No borrowings
were outstanding, and the remaining $460 million of the facility
was available for borrowing. Moody's projects RJR will not have to
rely on its revolver to meet its working capital and capital
spending plans and expects the company to maintain availability on
its revolver to meet extraordinary needs.

The company is continuing to evaluate options concerning the pre-
funding of its 2006 debt maturity of $500 million. If the notes
are refinanced prior to February 13, 2006, the maturity of the
$486 million credit facility will be extended to January 30, 2007.
However, if the company is unsuccessful in refinancing these
bonds, liquidity would deteriorate.

Moody's projects RJR to be well in compliance with all of its
financial covenants in the company's bank credit facility, and
therefore the covenants will not strain the company's liquidity
position.

R.J. Reynolds Tobacco Holdings, headquartered in North Carolina,
is a subsidiary of Reynolds American and is the parent company of
R.J. Reynolds Tobacco Company. R. J. Reynolds Tobacco Company is
the second largest tobacco company in the United States.

                         *     *     *

As reported in the Troubled Company Reporter on Aug. 27, 2004,
Moody's Investors Service affirmed the ratings of RJ Reynolds
Tobacco Holdings and changed the outlook to negative from stable,
due to a recent ruling by a Canadian court ordering payment by a
subsidiary of Japan Tobacco of C$1.4 billion in owed taxes, for
which RJ Reynolds might need to indemnify Japan Tobacco in the
future; and to the upcoming start of a trial potentially leading
to significant damages brought by the US Department of Justice
against the industry, including RJ Reynolds Tobacco Company and
Brown & Williamson.

Ratings affirmed:

   * Guaranteed senior secured debt, at Ba2; and

   * Non-guaranteed senior unsecured debt, at B2.


ROCK-TENN CO: Moody's Rates $700M Senior Unsec. Facilities at Ba2
-----------------------------------------------------------------
Moody's Investors Service downgraded Rock-Tenn Company's senior
unsecured bond ratings to Ba3 from Baa3 while simultaneously
issuing a Ba2 senior implied rating.  The outlook was restored to
stable.  The rating action follows Rock-Tenn's announcement of a
pending $540 million acquisition of the pulp, paperboard and
paperboard packaging assets of Gulf States Paper Corporation, and
concludes a review initiated on April 28th.  The company's new
$700 million senior unsecured guaranteed bank credit facility,
arranged to finance the acquisition, was rated Ba2.

The rating action accounts for three factors:

   (1) leverage increases significantly as a consequence of the
       acquisition

   (2) ongoing profit margin pressure has caused credit protection
       measures to come under pressure, and this impact is
       exacerbated by the influence of the acquisition debt.

   (3) the company's use of structurally senior bank debt
       disadvantages its existing bonds, resulting in notching.

Ratings Downgraded:

   * 7.25% Senior Unsecured Notes due August 1, 2005: to Ba3 from
     Baa3

   * 8.20% Senior Unsecured Notes due August 15, 2011: to Ba3 from
     Baa3

   * 5.625% Senior Unsecured Notes due March 15, 2013: to Ba3 from
     Baa3

   * Senior unsecured shelf: to (P)Ba3 to (P)Baa3

Ratings Issued:

   * Outlook: Stable

   * Senior implied: Ba2

   * Senior unsecured $450 million guaranteed revolving bank
     credit facility: Ba2

   * Senior unsecured $250 million guaranteed term bank credit
     facility: Ba2

Rock-Tenn has indicated it will use approximately $50 million of
cash on hand, $60 million from its accounts receivable
securitization facility, and proceeds from a new $700 million
senior unsecured guaranteed credit facility to fund the
acquisition. Moody's estimates that Rock-Tenn's debt will increase
by some 120% while its cash flow is expected to increase by
approximately 70%. The company has indicated that Debt-to-EBITDA,
measured on an adjusted LTM basis pro forma for the acquisition,
will increase by nearly a full turn to 4.4x. While the acquisition
provides diversification benefits and the potential for synergies
in the combined business' network of folding carton facilities,
ongoing raw materials and energy price escalation has caused
margin pressure in the company's core recycled paperboard
business. Margin pressure has also resulted from excess capacity
and resulting competition. Accordingly, cash flow available for
debt service - as a proportion of sales - has not been robust over
the recent past, and is not expected to strengthen significantly
over the near term. The additional leverage resulting from the
acquisition places further stress on credit protection measures.
Abstracting from classes of debt that result from disparate
guarantee structures, these two influences cause the relationship
between the company's debt and cash flow to be representative of a
Ba2 rating, and accordingly, the senior implied has been rated
Ba2.

Concurrent with arranging for acquisition financing, Rock-Tenn
will reconfigure its liquidity arrangements. The existing $75
million revolving facility will be replaced by a $450 million 5-
year unsecured revolving credit facility. $200 million will be
drawn at closing, as will the entirety of a $250 5-year amortizing
term loan that completes the balance of the $700 million bank
credit facility. Some $60 million of the company's existing $75
million accounts receivable securitization program will also be
drawn. The latter facility is committed to May 1, 2006. While bank
facility covenants have not yet been finalized, Moody's does not
expect near term compliance to be problematic. However, covenant
levels will likely prevent access to 100% of committed liquidity,
reducing the available amount by an estimated 30%. In addition,
the $74 million term debt maturity in August will displace unused
bank credit facility availability. In all, these arrangements are
adequate for the company's needs.

Rock-Tenn Company is a publicly traded holding company that
conducts its operations through various operating companies. As is
the case with the company's publicly traded debt, its new credit
facilities will be in the name of Rock-Tenn Company, and will be
unsecured. However, the bank facility will benefit from upstream
guarantees from domestic subsidiaries; the existing bonds do not.
Consequently, the publicly traded debt is structurally
subordinated to the bank debt. Pre-acquisition, with a relatively
small $75 million bank credit facility, this was not problematic.
Post-acquisition, with the bank debt representing approximately
two-thirds of total debt, the superior access to cash flow and
assets has a significant impact on realization prospects for the
company's bonds, and accordingly, their rating is notched down
from the senior implied rating to Ba3. Since some two-thirds of
debt is represented by the bank facility, it has been rated
equivalent to the senior implied rating at Ba2.

As a consequence of Moody's expectations of the magnitude and
stability of the company's margins, the outlook is stable. Moody's
expects Paper & Forest Products companies with Ba2 debt ratings to
generate average through-the-cycle RCF/TD of approximately 15%
with the commensurate FCF/TD figure being nearly 10%. In the
context of industry conditions, and given the impact of the
acquisition, Moody's expects Rock-Tenn to be able, on average
through the cycle, to achieve these metrics. Given the stability
the boxboard sector displays, Moody's expects profits and cash
flow generation to be more stable than those observed for other
Paper & Forest Products' commodities. Accordingly, with low profit
margins, Rock-Tenn will not be able to dramatically reduce its
debt load over the near-to-mid term.

Owing to the above factors, it is unlikely that the company's
ratings will be upgraded without relatively significant debt
amortization having occurred. Were that to occur, and if Moody's
estimates of average through the cycle RCF/TD approached 20% with
FCF/TD approaching 10%, an upgrade would be considered.
Alternatively, if Moody's assessment indicated the company could
not, on average through the cycle, achieve the above-noted Ba2
benchmark credit metrics (RCF/TD of approximately 15% with the
commensurate FCF/TD figure being nearly 10%), or if liquidity were
to deteriorate, the ratings would be subject to downgrade. Further
significant debt financed acquisition activity would also have an
adverse ratings impact.

Headquartered in Norcross, Georgia, Rock-Tenn Company, provides
marketing and packaging solutions to consumer products companies
from operating locations in the United States, Canada, Mexico and
Chile.


ROGERS COMMS: Plans to Acquire Call-Net for $330 Million in Stock
-----------------------------------------------------------------
Rogers Communications Inc. and Call-Net Enterprises Inc. entered
into a definitive agreement under which RCI will acquire 100% of
Call-Net in a share for share transaction under a plan of
arrangement.

Under the terms of the agreement, Call-Net Common and Class B
shareholders will receive a fixed exchange ratio of one RCI Class
B Non-voting share for each 4.25 outstanding shares of Call-Net,
representing a fully diluted equity value of approximately
$330 million.  In total, it is expected that upon closing of the
transaction approximately 9.0 million RCI Class B Non-voting
shares will be issued representing approximately 3.2% of the pro
forma shares outstanding.  Based upon the May 10, 2005 closing
price of the RCI Class B Non-voting shares, the transaction values
Call-Net at approximately $8.71 per share.  At March 31, 2005,
Call-Net had senior secured notes due 2008 of $269.8 million
outstanding and cash and short-term investments of $79.6 million.

"This acquisition will significantly jumpstart and expand our
ability to provide customers with a full suite of service
solutions that deliver the simplicity, quality and value they want
in one package, on one bill, from one provider," said Ted Rogers,
President and CEO of Rogers Communications Inc.  "This positions
us immediately to offer primary line telephone service across our
residential and business bases of wireless and cable customers.
It also provides a substantial additional base of customers to
cross-sell our portfolio of communications and entertainment
products and a skilled and knowledgeable employee group with
strengths in telephony sales and marketing.  As Rogers' cable
telephony service is deployed on a market by market basis, we will
be able to migrate Call-Net customers in our Rogers Cable
territory to our advanced digital cable telephony platform when
advantageous."

"This is a terrific day for Call-Net customers, shareholders,
employees, and for Canadian telecom in general," said Bill Linton,
President and CEO of Call-Net.  "We share a common heritage with
Rogers as a catalyst in bringing competition to the Canadian
communications markets.  By joining our business with one of the
foremost Canadian names in communications, entertainment and
information services, Call-Net customers will have a greatly
enhanced selection of advanced services to choose from in their
homes and businesses and the ability to enjoy the convenience of
complete multi-product bundles from a single provider.  The
combination of Rogers' innovative offerings and high quality
wireless and cable networks will bring tremendous additional
choice and value to our customers."

"This transaction offers an opportunity to acquire a significant
customer base and telecom assets that together provide network and
operating cost synergies and sales opportunities, which makes the
transaction attractive economically as well as strategically,"
added Ted Rogers.  "This will complement our deployment of an
advanced broadband IP multimedia network to support digital
voice-over-cable telephony and other new voice and data services
across the Rogers Cable service areas and expand the base of
customers that will benefit from them."

Call-Net, through its Sprint Canada subsidiary and with
approximately 1,800 employees, provides home phone and local
business service, IP data, long distance and wireless services to
approximately 600,000 consumers and business customers across
Canada, the majority of which are concentrated in areas served by
Rogers Cable. Call-Net owns a 14,000 route kilometre North
American transcontinental fibre optic broadband network that spans
across Canada and connects all major cities and into main U.S.
voice and data network access and peering points.  Call-Net also
has more than 150 central office co-location points in all of
Canada's largest markets as well as options to acquire significant
CLEC assets, including extensive local fibre in eastern Canada,
most of which are within Rogers Cable's serving areas.  Call-Net's
wireless services are offered to its customers, alone and in
bundles with other voice services, through a wholesale agreement
with Rogers' Fido division.

Rogers anticipates that it will realize cost savings from the
transaction, including reduced payments to incumbent and other
telecom providers.  The reduction in costs currently incurred by
Sprint Canada, Rogers Wireless and Rogers Cable include the areas
of local and long haul interconnection, the rental of local loops
and transport, Internet and other data transport costs, and the
costs associated with the transport of local and long haul
wireless traffic.

The boards of directors of Rogers and Call-Net have approved the
transaction, with the members of the Call-Net Board having agreed
that the transaction is fair to their shareholders and that they
will recommend that the Call-Net shareholders approve the
transaction at a Call-Net shareholder meeting expected to be held
before June 30, 2005.

BMO Nesbitt Burns is acting as financial advisor to Call-Net on
this transaction and has provided Call-Net's Board of Directors
with a fairness opinion that the consideration to be received
under the Plan of Arrangement is fair, from a financial point of
view, to the shareholders of Call-Net.  Scotia Capital is acting
as financial advisor to Rogers on this transaction.

Subject to certain customary conditions, including among others,
regulatory approvals and acceptance by Call-Net shareholders
representing at least two-thirds of the votes cast in respect of
the Plan of Arrangement, this transaction is expected to close
during the third quarter of 2005.  The transaction is expected to
be accounted for as a purchase and it is anticipated that the
share-for-share exchange will be structured as tax-free to
eligible Canadian shareholders.  Call-Net has agreed not to
solicit or take certain other actions with respect to any
competing proposal, and in addition has agreed to pay Rogers a
termination fee of $10 million under specified conditions.

A proxy circular relating to the transaction is expected to be
sent to Call-Net's shareholders prior to the end of May 2005.
Investors are urged to read the proxy circular regarding the
transaction when it becomes available, as it will contain
important information.

Holders of Call-Net Common shares and Class B Non-Voting shares
are reminded that

     (i) each Common share may, at the option of the holder, be
         exchanged at any time for one Class B Non-Voting share
         and

    (ii) each Class B Non-Voting share may, at the option of the
         holder by providing a declaration of Canadian residency
         to Call-Net's transfer agent, be exchanged at any time
         for one voting Common share.

                           About Call-Net

Call-Net Enterprises Inc. (TSX: FON, FON.NV.B), primarily through
its wholly owned subsidiary Sprint Canada Inc., is a leading
Canadian integrated communications solutions provider of home
phone, wireless, long distance and IP services to households, and
local, long distance, toll free, enhanced voice, data and IP
services to businesses across Canada.  Call-Net, headquartered in
Toronto, owns and operates an extensive national fibre network,
has over 151 co-locations in five major urban areas including 33
municipalities and maintains network facilities in the U.S. and
the U.K.  For more information, visit http://www.callnet.ca/and
http://www.sprint.ca/

                    About Rogers Communications

Rogers Communications, Inc., (TSX: RCI; NYSE: RG) is a diversified
Canadian communications and media company engaged in three primary
lines of business.  Rogers Wireless is Canada's largest wireless
voice and data communications services provider and the country's
only carrier operating on the world standard GSM/GPRS technology
platform; Rogers Cable is Canada's largest cable television
provider offering cable television, high-speed Internet access and
video retailing; and Rogers Media is Canada's premier collection
of category leading media assets with businesses in radio,
television broadcasting, televised shopping, publishing and sport
entertainment.

                         *     *     *

As reported in the Troubled Company Reporter on Nov. 10, 2004,
Standard & Poor's Ratings Services lowered its long-term corporate
credit ratings on Rogers Communications, Inc. -- RCI, Rogers Cable
Inc., and Rogers Wireless Inc. -- RWI -- to 'BB' from 'BB+'
following RWI's successful tender for various equity securities of
Microcell Telecommunications, Inc.  Given the success of the
offer, and lack of any other material conditions RWI is expected
to complete the acquisition of Microcell in the near term.  The
outlook is currently stable.


SALEM COMMS: Names Carl Miller National Program Placement Director
------------------------------------------------------------------
Salem Communications Corporation (Nasdaq:SALM) named Carl Miller
has been to the newly created post of director of national program
placement reporting to Ron Walters, vice president of national
programming and ministry development.  In this role, Mr. Miller
will work with Salem's Christian Teaching and Talk radio stations
in meeting the ongoing demands of national ministries for air
time.

Ron Walters noted that Mr. Miller is uniquely qualified for this
new position.  "Salem's continued growth both geographically and
exponentially, and the increased demand for air time by national
block programming partners, solidified the need for this new role.
No one could be more suited to this position than Carl Miller.  As
a long-time general manager in two of Salem's markets, he's the
right person to help our CTT stations facilitate the on-going
demands for air time.  As a current host and producer, Carl is
acutely aware of standards for broadcast quality, and his past
agency experience developing programming for national ministry
clients makes him the perfect choice for this position."

Mr. Miller has spent more than three decades in the radio industry
serving in all aspects of radio production and management for
broadcasters Crawford Broadcasting and Bott Radio Network.  In
1982, Mr. Miller joined Ambassador Advertising in Fullerton,
Calif., heading up production.  There he produced more that two
dozen radio programs and features for Christian radio stations.
During that time, he provided voice work for national programs
including Joni & Friends, Turning Point, The Art of Family Living
and Grace to You, a program he continues to support today as
host/announcer.

In 1989, Mr. Miller returned to radio operations joining Salem
Communications' WMCA-AM in New York as operations manager.  He
served the New York market until 1997 when he became general
manager of Salem's Cleveland, Ohio stations.  In 2000, Mr. Miller
returned to New York to assume the role of general manager of
WMCA-AM and WWDJ-AM.  Three years later, Miller relocated to
Edmond, Okla., and was named director of creative services for
Salem assisting National Programming with the creation of long
form programming and promotional efforts.

Mr. Miller is a graduate of American Christian College in Tulsa,
Okla., with a degree in Biblical Studies. He and his wife Louise
reside in the Oklahoma City area.

Salem Communications Corporation (Nasdaq:SALM) --
http://www.salem.cc/-- headquartered in Camarillo, is the leading
U.S. radio broadcaster focused on Christian and family-themed
programming. Upon the close of all announced transactions, the
company will own 105 radio stations, including 67 stations in 24
of the top 25 markets. In addition to its radio properties, Salem
owns Salem Radio Networkr, which syndicates talk, news and music
programming to approximately 1,900 affiliates; Salem Radio
Representatives(TM), a national radio advertising sales force;
Salem Web Network(TM), a leading Internet provider of Christian
content and online streaming; and Salem Publishing(TM), a leading
publisher of Christian-themed magazines.

                          *     *     *

As reported in the Troubled Company Reporter on Dec. 16, 2004,
Moody's Investors Service upgraded the long-term debt ratings for
Salem Communications Holding Corporation.  The upgrades are driven
mostly by improvements at development-stage stations, better than
expected financial performance in 2004, the company's willingness
to issue equity to reduce total debt and the subsequent balance
sheet de-leveraging.  Moody's said the outlook is stable.


SEARS ROEBUCK: Finance Unit Delisting Shares & Buying Back Notes
----------------------------------------------------------------
Sears Roebuck Acceptance Corp., a wholly owned finance subsidiary
of Sears, Roebuck and Co. and an indirect wholly owned subsidiary
of Sears Holdings Corporation (Nasdaq: SHLD), filed an application
to voluntarily delist all of its debt securities that are
currently listed on the New York Stock Exchange and deregister
these securities with the Securities and Exchange Commission.  The
securities to be delisted and deregistered are:

   -- SRAC's 7% Notes due 2042 (NYSE: SRJ),
   -- 7.4% Notes due 2043 (NYSE: SRL), and
   -- 6.75% Notes due September 2005 (NYSE: SRAC05).

SRAC expects the delisting to be effective in June 2005.  Upon
delisting of these debt securities, SRAC expects that its
reporting obligations, and the related reporting obligations with
respect to the guarantor of the debt, Sears, Roebuck and Co.,
under the federal securities laws will be suspended.

                        Tender Offers

SRAC intends to commence within approximately one week one or more
tender offers to purchase for cash any and all of the 7% Notes due
2042 (which have an aggregate principal amount outstanding of
approximately $111 million) and the 7.4% Notes due 2043 (which
have an aggregate principal amount outstanding of approximately
$94 million).

The tender offers are expected to be at a fixed price of $25.65
per $25 principal amount of the 7% Notes due 2042 and $25.75 per
$25 principal amount of the 7.4% Notes due 2043.  These fixed
prices include all accrued and unpaid interest; no additional
interest will be paid on the tendered Notes.  Additional
information will be available upon commencement of the tender
offers.

Each tender offer will be made solely pursuant to the terms and
conditions contained in the Offer to Purchase and related
documents.  Each tender offer for each series of Notes is expected
to be independent and is not expected to be conditioned upon the
other tender offer, and each tender offer may be amended, extended
or terminated individually.  The tender offers are not expected to
be conditioned on any minimum amount of Notes being tendered.  The
tender offers are expected to expire 20 business days following
commencement of the tender offers, unless earlier extended or
terminated.  SRAC expects to commence the tender offers and begin
distribution of offering materials to debt holders within
approximately one week.  These materials will contain important
information.  Security holders are urged to carefully review these
documents and related materials when they become available.

This announcement is not an offer to purchase or the solicitation
of an offer to purchase with respect to any securities, nor will
the tender offers be made in any jurisdiction in which such an
offer would be unlawful.

               About Sears Holdings Corporation

Sears Holdings Corporation -- http://www.searsholdings.com/-- is
the nation's third largest broadline retailer, with approximately
$55 billion in annual revenues, and with approximately 3,800 full-
line and specialty retail stores in the United States and Canada.
Sears Holdings is the leading home appliance retailer as well as a
leader in tools, lawn and garden, home electronics and automotive
repair and maintenance.  Key proprietary brands include Kenmore,
Craftsman and DieHard, and a broad apparel offering, including
such well-known labels as Lands' End, Jaclyn Smith and Joe Boxer,
as well as the Apostrophe and Covington brands.  It also has
Martha Stewart Everyday products, which are offered exclusively in
the U.S. by Kmart and in Canada by Sears Canada.  The company is
the nation's largest provider of home services, with more than 14
million service calls made annually.

                   About Sears, Roebuck and Co.

Sears, Roebuck and Co., -- http://www.sears.com/-- a wholly owned
subsidiary of Sears Holdings Corporation (Nasdaq: SHLD), is a
leading broadline retailer providing merchandise and related
services.  Sears, Roebuck offers its wide range of home
merchandise, apparel and automotive products and services through
more than 2,400 Sears-branded and affiliated stores in the United
States and Canada, which includes approximately 870 full-line and
1,100 specialty stores in the U.S.  Sears, Roebuck also offers a
variety of merchandise and services through --
http://www.sears.com/-- , -- http://www.landsend.com/--, and
specialty catalogs. Sears, Roebuck offers consumers leading
proprietary brands including Kenmore, Craftsman, DieHard and
Lands' End -- among the most trusted and preferred brands in the
U.S. The company is the nation's largest provider of home
services, with more than 14 million service calls made annually.

                  About Sears Roebuck Acceptance Corp.

SRAC is a wholly owned finance subsidiary of Sears, Roebuck and
Co.  It raises funds through the issuance of unsecured commercial
paper and long-term debt, which includes medium-term notes and
discrete underwritten debt.  SRAC continues to support 100% of its
outstanding commercial paper through its investment portfolio and
committed credit facilities.

                           *     *     *

As reporter in the Troubled Company reporter on March 31, 2005,
Moody's Investors Service downgraded the guaranteed senior
unsecured debt rating of Sears Roebuck Acceptance Corp. to Ba1
from Baa2, as well its commercial paper rating to Not Prime from
Prime 2, and affirmed the Ba1 senior implied rating of Sears
Holding Corporation.  The rating outlook is stable.

Ratings downgraded:

     Sears, Roebuck and Co.

        * Senior unsecured shelf to (P) Ba1 from (P) Baa2;
        * Preferred shelf to (P) Ba3 from (P) Ba1.

     Sears Roebuck Acceptance Corp.

        * Senior unsecured debt to Ba1 from Baa2;
        * Senior unsecured MTN to Ba1 from Baa2;
        * Subordinated MTN to Ba2 from Baa3;
        * Senior unsecured shelf to (P) Ba1 from (P) Baa2;
        * Subordinate shelf to (P) Ba2 from (P) Baa3;  and
        * Commercial paper rating to Not Prime from Prime-2.

     Sears DC Corp.

        * Medium term notes to Ba1 from Baa2.

Ratings assigned:

     Sears Holdings Corporation

        * Senior implied rating at Ba1;
        * Senior unsecured issuer rating at Ba1;  and
        * $4 billion senior secured revolving credit facility
          at Baa3.

Ratings lowered and will be withdrawn:

     Sears, Roebuck and Co.

        * Long term issuer rating of Baa2 to Ba1 and will be
          withdrawn.

     Sears Roebuck Acceptance Corp.

        * Long term issuer rating of Baa2 to Ba1 and will be
          withdrawn.


SCHUFF INTERNATIONAL: Improved Liquidity Cues S&P to Lift Ratings
-----------------------------------------------------------------
Standard & Poor's Ratings Services raised its corporate credit
rating and senior unsecured debt rating on Schuff International
Inc. to 'B-'.  The outlook is stable.  At Dec. 31, 2004, Schuff
had about $93 million of lease-adjusted debt.

"The upgrade reflects recent improvements in Schuff's liquidity
and financial profile," said Standard & Poor's credit analyst Paul
Kurias.  "Liquidity has improved mainly because of April 2005
amendments to the company's bank facilities that freed up
previously restricted cash.  The company's unrestricted cash
balance had risen to about $20 million as of April 30, 2005, from
about $6.5 million at Dec. 31, 2004."

Schuff's liquidity and financial position have also improved
because of a strengthening of commercial and industrial
construction markets, and the company was particularly helped by
three large projects.  As a result, lease-adjusted total debt to
EBITDA declined sharply to 4.5x for fiscal 2004 from more than 25x
for the previous year.

Schuff provides construction services and fabricated steel
products to highly cyclical industrial and commercial markets.
The protracted weakness in these sectors, combined with intense
pricing pressures, has resulted in volatile operating results in
the recent past.


SINO-FOREST CORP: Closes $195M Financing on Mandra Transactions
---------------------------------------------------------------
Sino-Forest Corporation has entered into the definitive
agreements, with Mandra Forestry Finance Limited and certain of
its subsidiaries in connection with the proposed plantation
transaction and closed on the financing pursuant to the proposed
transactions.

As reported in the Troubled Company Reporter on Apr. 14, 2005,
Sino-Forest Corporation agreed to enter into a series of
agreements with Mandra Resources Limited and certain of its
subsidiaries that are start-up companies formed to acquire, grow,
harvest and replant standing timber on commercial forestry
plantations located in Anhui province in the People's Republic of
China.

Sino-Forest has been provided with a fairness opinion by an
investment banking firm of international standing to the effect
that the commercial relationship between Sino-Forest and Mandra is
fair from a financial point of view to Sino-Forest and its
relevant subsidiaries.  Mandra has received a report from JP
Management Consulting (Asia Pacific) Pte Ltd. relating to the
Mandra Project, which includes a review of the suitability of
areas around various cities in Anhui province for the development
of commercial forestry plantations.

The implementation of the proposed agreements is subject to Mandra
Forestry Finance Limited raising third party financing sufficient
to implement the Mandra Project, which Mandra Finance is currently
seeking, and, in connection with the completion of the Financing,
the parties will enter into agreements pursuant to which:

   -- Sino-Forest will advance a US$15 million subordinated loan
      to Mandra Forestry Holdings Limited, the parent corporation
      of Mandra Finance, at the completion of the Financing;

   -- Sino-Forest will acquire, for nominal consideration, a 15%
      equity investment in Mandra Holdings;

   -- Sino-Forest will be entitled and obligated to purchase
      substantially all of the commercially saleable cut logs
      harvested from the Plantations pursuant to a seven year
      committed sales agreement at a 3% discount to the then-
      prevailing market price, which agreement may be extended
      annually for up to another five years at Mandra's option;

   -- Sino-Forest will be engaged for a seven year period under an
      operating management agreement to provide certain
      management, operating and support services to help operate
      and manage the Plantations, in return for a quarterly
      service fee equal to the greater of US$250,000 and 10% of
      the estimated reimbursable expenses for the quarter, which
      agreement may be extended annually for up to another five
      years at Mandra's option;

   -- Subject to certain conditions, Sino-Forest will have an
      option to acquire all the other outstanding shares of Mandra
      Holdings at their then fair market value (subject to certain
      conditions), which option is exercisable from the third
      anniversary of the date of the Shareholders Agreement (or
      earlier in certain circumstance) to the fifth anniversary of
      the date of the Shareholders Agreement;

   -- Sino-Forest will be granted a right of first offer to
      purchase the equity securities of Mandra Holdings from the
      other shareholders thereof in respect of any proposed sales
      by such shareholders between the fifth and seventh
      anniversaries of the date of the Shareholders Agreement, and
      Mandra Resources Limited (the controlling shareholder of
      Mandra Holdings) will be granted a drag-along right to
      compel each of the other shareholders of Mandra Holdings to
      sell their shares in a sale by Mandra Resources any time
      after the fifth anniversary of the Shareholders Agreement;
      and

   -- Sino-Forest will gain access to potential plantation
      production in a province of the PRC where Sino-Forest does
      not currently carry on activities but which Sino-Forest
      considers to be an important strategic location given its
      proximity to the Yangzi River Delta.

Sino-Forest believes that during the initial term of the
agreements with Mandra, the combination of discounts to market
prices paid for cut logs, together with fees earned by Sino-Forest
under the operating agreement, will enable Sino-Forest to recover
the amount of the investment made by it, assuming that the Mandra
Project proceeds according to current expectations.  Sino-Forest
Chairman and CEO Allen Chan said "This strategic transaction is
expected to further strengthen Sino-Forest's leadership position
as a commercial plantation operator in China, by significantly
increasing our access to logs with relatively little capital
investment. It will also further diversify our sources of revenue
geographically and give us the opportunity to significantly
increase our investment in this new venture in the future."

Under Mandra Finance's operating plan, Mandra Finance intends to
acquire up to 270,000 hectares of mature, half-mature and young
Chinese fir and pine trees, to grow and harvest them and to sell
them to Sino-Forest.  This potential access to significant amounts
of cut logs is therefore to be available to Sino-Forest without
the capital expenditure, which would be required if Sino-Forest
was initiating this project on its own.  Mandra may also acquire
an additional 50,000 hectares of standing timber.

Mandra Finance's current acquisition plan contemplates acquiring
standing timber on approximately 133,300 hectares of commercial
forests in each of the first two years of its operation, or sooner
if possible.  While Mandra Finance has undertakings with certain
local forestry bureaus to assist in acquiring up to an aggregate
of approximately 350,000 hectares of commercial forests from the
holders of land use rights in their respective jurisdictions,
Mandra Finance must still negotiate the final price and other
commercial terms in the definitive agreements with the holders of
land use rights.

Sino-Forest will agree not to operate forestry plantations or
provide forestry plantation services to any other person in Anhui
province that could reasonably be expected to have a material
adverse effect on the performance of its obligations under the
arrangements with Mandra Finance, and Mandra Finance and Mandra
Holdings will agree not to operate forestry plantations or provide
forestry plantation services to anyone in the PRC outside of Anhui
province, in each case during the term of the agreements and for a
period of three years thereafter.

The rights and obligations of Sino-Forest under all of the
foregoing agreements, whether executed prior to or
contemporaneously with, the completion of the Financing, will be
conditional upon the completion of the Financing.

                  US$195 Million Financing Closed

Mandra Finance completed the financing consisted of an
international private placement of US$195 million of debt
securities, together with warrants to subscribe for up to 20% (on
a fully diluted basis) of the ordinary equity shares of Mandra
Forestry Holdings Limited, the parent corporation of Mandra
Finance, for nominal consideration.

Sino-Forest Chairman and CEO Allen Chan said, "We look forward to
working with Mandra on initiating the harvesting and sale of its
standing timber in the third and fourth quarters of 2005, and to
generating new revenues from operations in the geographically
strategic Anhui Province of China.  This transaction will allow
Sino-Forest to augment and diversify its access to logs and its
plantation area under management, without having to make a
significant capital investment."

                        Shareholder Meeting

Sino-Forest will hold its Annual General Meeting of shareholders
on Monday, May 16 at 4pm (EST) in the Imperial Room of the
Fairmont Royal York Hotel at 100 Front Street West (corner of York
Street) in downtown Toronto, Canada.  CCN Matthews will provide a
live webcast of the Chairman's presentation at the following link:

http://events.onlinebroadcasting.com/sinoforest/051605/index.php

Sino-Forest Corporation (S&P, BB- Credit Rating, Stable Outlook,
July 28, 2004) is the largest, foreign-owned, commercial forestry
plantation operator in China in terms of plantation area.  Sino-
Forest cultivates and harvests trees for sale as standing timber,
logs and wood fiber for the manufacturing of wood chips for pulp &
paper processing, and of engineered wood products for the
furniture, construction and decoration industries. Sino-Forest is
a Canadian corporation with executive offices in Hong Kong and
plantations in south-east China.  Sino-Forest operates through two
wholly owned subsidiaries - Sino-Panel Holdings Limited and Sino-
Wood Partners Limited.  Sino-Forest's common shares have been
listed on the Toronto Stock Exchange since 1995 and trade under
the symbol TRE.


SITHE/INDEPENDENCE: Moody's Holds Ratings Despite Dynegy Review
---------------------------------------------------------------
Moody's Investors Service affirmed the Ba2 senior secured bonds of
Sithe/Independence Funding Corporation.

This affirmation follows the announcement on May 9, 2005, that
Moody's placed the rating of Dynegy Inc. and its rated
subsidiaries under review for possible upgrade.  In addition to
being the equity owner of Sithe/Independence Power Partners, L.P.
(Sithe/Independence), Dynegy Holdings, Inc. (Caa2 senior
unsecured, under review for possible upgrade) is the guarantor of
Dynegy Power Marketing's tolling obligation with
Sithe/Independence.

The rating affirmation considers that the existing wide notching
differential between Sithe Funding's Ba2 senior secured rating and
DHI's Caa2 (under review for possible upgrade) senior unsecured
rating reflects the importance of factors other than DHI's
creditworthiness.  These factors reflect:

   (1) the credit insulating protections inherent in
       Sithe/Independence's project finance structure,

   (2) its stand alone operations and financial performance, and

   (3) the fact that a majority of its cash flows are derived from
       a long term capacity contract with the Consolidated Edison
       Company of New York (A1 senior unsecured).

Sithe/Independence Funding Corporation is a wholly owned
subsidiary of Sithe/Independence Power Partners, L.P., which is a
1,040 MW natural gas fired cogeneration facility located in Oswego
County, New York.  Sithe Funding's debt is guaranteed by
Sithe/Independence Power Partners and secured by all the assets of
Sithe/Independence.


SPANISH BROADCASTING: S&P Junks Proposed $100MM Second-Lien Loan
----------------------------------------------------------------
Standard & Poor's Ratings Services assigned a 'B+' rating and a
recovery rating of '1' to Spanish Broadcasting System Inc.'s
proposed $325 million senior secured first-lien bank facility,
indicating high expectation of a full recovery of principal in a
default scenario.

At the same time, Standard & Poor's assigned a 'CCC+' rating and a
recovery rating of '4' to the company's proposed $100 million
second-lien bank term loan, indicating expectations for a marginal
recovery of principal (25%-50%) in a default scenario.

The new ratings are based on preliminary terms and conditions.
Standard & Poor's affirmed its 'B' long-term corporate credit
rating on SBS.  The current outlook is negative.

Proceeds of $400 million from the first- and second-lien term
loans and $99 million in cash will be used:

    (1) to finance a tender offer for the company's $335 million
        9.625% subordinated notes,

    (2) to repay $123 million in bank debt, and

    (3) to cover related premiums and expenses.

On a pro forma, March 31, 2005, basis, the company had $404
million in debt and $87 million in debt-like preferred stock.

The refinancing will modestly benefit SBS' capital structure by:

    (1) reducing debt about 10%,

    (2) refinancing bonds with lower rate bank debt, and

    (3) increasing the company's undrawn revolving credit facility
        to $25 million from $10 million.

More significant leverage and cash flow benefits will be realized
if the company completes its plan to repay the proposed second-
lien term debt with the proceeds from the pending sales of two
noncore Los Angeles radio stations.  The sales are expected to
close by July 31, 2005.

"Standard & Poor's is concerned that these gains could be
temporary because of the potential for further debt-financed
acquisitions and because quality broadcasting assets are very
expensive in SBS' large markets," said Standard & Poor's credit
analyst Steve Wilkinson.

The rating on SBS reflects its:

    (1) significant cash flow concentration in a few large U.S.
        Hispanic markets,

    (2) its small cash flow base,

    (3) competition from much larger rivals,

    (4) somewhat below-average margins for a broadcaster, and

    (5) potential for additional debt-financed acquisitions to
        keep financial risk elevated.

The rating also considers Spanish-language radio's historical
inability to draw advertising revenues commensurate with its
audience ratings.

These risks are only partially offset by:

    (1) the good margin and cash flow potential of the radio
        broadcasting business,

    (2) the strong asset values of SBS' large-market radio
        stations, and

    (3) favorable Spanish-language population and advertising
        trends.

The negative outlook reflects:

    (1) concern about the company's high leverage,

    (2) its limited discretionary cash flow, and

    (3) the potential for debt-financed acquisitions to aggravate
        these credit measures.

Deterioration of operating results or debt-financed acquisitions
could lead to a downgrade.  These concerns could be partially
mitigated by the company's debt reduction plans, and Standard &
Poor's expects to revise its outlook on the company to stable if
planned debt repayment reduces the company's debt plus preferred
stock to EBITDA to around 7x, and if positive operating trends
continue.

Pro forma for pending asset sales, SBS operates 20 Spanish-
language radio stations in six of the top 10 U.S. Hispanic
markets.  While the company has solid ratings in its markets, it
faces intense competition for advertisers and audiences from much
larger Spanish- and English-language broadcasters.  Significant
cash flow concentration in the New York, Los Angeles, and Miami
markets make the company vulnerable to economic softness and
competitive pressures in these markets.


STELCO INC: Earns $49 Million of Net Income in First Quarter
------------------------------------------------------------
Stelco Inc. (TSX:STE) reported net earnings of $49 million in the
first quarter ended March 31, 2005.  This record level of first
quarter earnings for the Company is compared to a net loss of
$37 million in the first quarter of 2004 and net earnings of
$1 million in the fourth quarter of 2004.

Net sales revenue in the first quarter was $968 million compared
to $769 million for the same period in 2004.  This 26% increase
was largely attributable to the renewal of customer contracts at
substantially higher prices and increased spot market prices due
to improved market demand, as well as selling price surcharges
implemented to cover higher raw material and energy costs.

The cost of sales for the first quarter of 2005 was $821 million
compared to $735 million for the same quarter in 2004.  This 12%
increase was attributable to such factors as the rise in raw
material and energy costs, including scrap, coal, coke, natural
gas and iron ore; the increased cost of hot roll and rod as raw
materials for Stelco's manufactured products business; higher
employment costs, particularly in the areas of pensions and health
care; higher spending for repairs, maintenance and supplies; and
reduced semi-finished steel production in Hamilton.

Production in the first quarter of 2005 was 1,256,000 semi-
finished tons compared to 1,366,000 semi-finished tons produced
during the same period in 2004. Shipments during the first quarter
of 2005 totaled 1,200,000 net tons compared to 1,266,000 net tons
shipped during the first quarter of 2004.

As at March 31, 2005, Stelco's consolidated net liquidity position
was $346 million compared to $284 million as at December 31, 2004
and $239 million as at March 31, 2004.  The net liquidity position
of the applicants involved in proceedings under the Companies'
Creditors Arrangement Act was $297 million at March 31, 2005
compared to $237 million at December 31, 2004, and $196 million at
March 31, 2004.

Net cash of $65 million was generated during the first quarter of
2005, representing a $96 million improvement from the $31 million
consumed in the first quarter of 2004. The strength of operating
earnings, driven by high selling prices, accounted for the
majority of the improvement.

Courtney Pratt, Stelco's President and Chief Executive Officer,
said, "Stelco continued to benefit from robust market conditions
and steel prices during the first quarter. Positive factors
shaping our outlook for the balance of the year include the likely
continuation of strong steel prices, the stability provided by our
contract customer base, and the strong raw materials position we
enjoy through our ownership of iron ore mining properties, in-
house production of coke, and coal purchase contracts.

"I hope that all stakeholders will take advantage of our positive
performance to work towards our shared goal of a viable and
competitive Stelco rather than allow this opportunity to pass."

                           Guidance

On March 8, 2005, Stelco provided guidance with respect to 2005
operating earnings.  At that time the Corporation advised that
2005 operating earnings were estimated to be in the range of $350
to $400 million.  It indicated that this estimate included the
impact of a shutdown of the Lake Erie hot strip mill, but did not
include any restructuring-related costs or the impact of the
possible sale of any of its subsidiary companies.  The guidance
also included assumptions around a strong first quarter, with spot
market prices declining somewhat over the balance of the year.

Operating earnings in the first quarter of 2005 were strong at
$118 million, in line with the estimate in the guidance provided
on March 8, 2005. The Corporation expects solid second quarter
performance although operating earnings as anticipated are
expected to be lower than record first quarter results. Although
the Corporation expects a significant increase in operating
earnings in 2005, given the current dynamics of global steel
markets and the effect on steel prices, the markets have become
more difficult to predict. Issues include fluctuating spot market
pricing, raw materials costs and the currently uncertain
automotive sector. The Corporation is therefore reviewing its
March 8, 2005 guidance for the second half of the year and expects
to reaffirm or amend its full year's guidance by the end of May
2005.

Stelco, Inc. -- http://www.stelco.ca/-- 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.

In early 2004, after a thorough financial and strategic review,
Stelco concluded that it faced a serious viability issue. The
Corporation incurred significant operating and cash losses in 2003
and believed that it would have exhausted available sources of
liquidity before the end of 2004 if it did not obtain legal
protection and other benefits provided by a Court-supervised
restructuring process.  Accordingly, on January 29, 2004, Stelco
Inc. and certain related entities filed for protection under the
Companies' Creditors Arrangement Act.


TECO ENERGY: Moody's Assigns Ba1 Senior Implied Rating
------------------------------------------------------
Moody's Investors Service affirmed the ratings of TECO Energy,
Inc. (TECO: Ba2 senior unsecured) and assigned a Ba1 Senior
Implied Rating.

Moody's also affirmed the ratings of TECO's subsidiary Tampa
Electric Company (Tampa Electric: Baa2 senior unsecured) and
affirmed the Ba3 rating on the trust preferred securities of TECO
Capital Trust I.

The rating outlook was revised to stable from negative for TECO,
Tampa Electric, TECO Capital Trust I and TECO Capital Trust II.

The revision of the rating outlook reflects reduced business risk
resulting from the company's progress in exiting the merchant
generation business, including the nearly completed transfer of
the Union and Gila River power stations to the project lenders.
The outlook revision also considers:

   (1) the commitment to a back-to-basics strategy focusing on its
       core Florida utility operations;

   (2) improved liquidity resulting from non-core asset sales and
       modifications of bank facilities; and

   (3) Moody's expectation that the company's cash flow will be
       more predictable going forward and allow it to reduce or
       refinance the significant debt maturities that occur in
       2007.

The stable outlook also considers the fundamental change in
strategy made by the company over the last two years, particularly
since it installed a new CEO in 2004.  Since that time, the
company has successfully sold or otherwise disposed of a number of
its non-core assets, including its Hardee, Hamakua, TIE (Odessa
and Guadalupe), Commonwealth Chesapeake, and Frontera power
stations.  It is also in the final stages of terminating its
involvement in the Union and Gila River power stations, which are
expected to be transferred to the lending banks later this month.
Although TECO still retains the mothballed Dell and McAdams
plants, the company's total merchant generation portfolio has
declined significantly and the remaining exposure will be more
manageable going forward.  The company is considering strategic
alternatives for these two remaining plants and is likely to exit
these investments as well.  Future cash flow generation will be
derived predominantly from TECO's more stable Tampa Electric and
Peoples Gas regulated utility subsidiaries, as well as other core
operations, including TECO Coal and TECO Transport.

The Ba1 senior implied rating reflects TECO's continued high
leverage, much of it a legacy of its merchant generation expansion
strategy, and Moody's expectation that the company's operating
cash flow generation will represent less than 15% of adjusted debt
over the next two years.  Approximately $1.0 billion of the
company's debt is due in 2007, $750 million of which is at the
parent company.  Moody's expects TECO to generate adequate cash to
retire a significant portion of these debt maturities.  A key
variable that could affect the company's ability to meet its cash
flow projections is the amount of cash it receives from its
synthetic fuels business, which could be negatively affected by
sustained higher oil prices.  In addition, tax credits from
synthetic fuels expire at the end of 2007.

Ratings affirmed include:

   -- TECO Energy

      * senior unsecured debt at Ba2;

   -- TECO Capital Trust I

      * trust preferred securities at Ba3

   -- TECO Capital Trust II

      * trust preferred securities at (P)Ba3.

   -- Tampa Electric

      * senior secured debt at (P)Baa1;
      * senior unsecured debt and Issuer Rating at Baa2; and
      * long-term pollution control revenue bonds at Baa2.

TECO Energy, Inc. is a diversified energy company headquartered in
Tampa Florida and is the parent company of Tampa Electric Company.


TIMOTHY C. WHEELER: Case Summary & 20 Largest Unsecured Creditors
-----------------------------------------------------------------
Debtor: Timothy C. Wheeler
        dba Wolfe Plumbing & Heating
        P.O. Box 3916
        Stateline, Nevada 89449

Bankruptcy Case No.: 05-51470

Type of Business: The Debtor provides plumbing and heating
                  services for commercial, residential and
                  industrial water heaters and furnaces.

Chapter 11 Petition Date: May 12, 2005

Court: District of Nevada (Reno)

Debtor's Counsel: John S. Bartlett, Esq.
                  777 East William Street #201
                  Carson City, Nevada 89701
                  Tel: (775) 841-6444
                  Fax: (775) 841-2172

Total Assets: $1,061,600

Total Debts:  $1,156,788

Debtor's 20 Largest Unsecured Creditors:

   Entity                        Nature of Claim    Claim Amount
   ------                        ---------------    ------------
American Express                 Credit Card             $60,000
Customer Service
P.O. Box 7836
Fort Lauderdale, FL 33329-7836

Internal Revenue Service                                 $58,469
4750 West Oakey
Stop 5028LVG
Las Vegas, NV 89102

Internal Revenue Service                                 $30,458
4750 West Oakey
Stop 5028LVG
Las Vegas, NV 89102

MBNA America                     Bank loan               $26,000
P.O. Box 15026
Wilmington, DE 19850-5026

American Express                 Credit Card             $23,000
Customer Service
P.O. Box 7836
Fort Lauderdale, FL 33329-7836

American Express                 Credit Card             $22,500
Customer Service
P.O. Box 7836
Fort Lauderdale, FL 33329-7836

Bank One                         Credit Card             $19,000
P.O. Box 8650
Wilmington, DE 19899-8650

Discover Bank                    Credit Card             $17,000
P.O. Box 7112
Dover, DE 19903-9955
Attn: Terry Brandt
Tel: (866) 419-5342

Western Nevada Supply            Trade debt              $13,197
P.O. Box 1576
Sparks, NV 89432

American Express                 Credit Card              $8,000
Customer Service
P.O. Box 7836
Fort Lauderdale, FL 33329-7836

Bank of America                  Credit Card              $6,000
P.O. Box 1390
Norfolk, VA 23501-1390

Nevada Department of Taxation                             $5,851
Bankruptcy Section
555 East Washington Avenue, #1300
Las Vegas, NV 89101-1041

American Express                 Credit Card              $5,000
Customer Service
P.O. Box 7836
Fort Lauderdale, FL 33329-7836

Retail Services                  Bank loan                $5,000
P.O. Box 60107
City Of Industry, CA 91716

Household Bank                   Bank loan                $4,500
P.O. Box 5244
Carol Stream, IL 60197

MBNA America                     Bank loan                $4,500
P.O. Box 15026
Wilmington, DE 19850-5026

RSupply Company                  Trade debt               $4,227
P.O. Box 2877
Reno, NV 89505

Sears Card                                                $3,000
P.O. Box 818017
Cleveland, OH 44181-8017

Inspection Consultants           Bank loan                $2,725
1515 North C Street
Sacramento, CA 95814

Sears National Bank                                       $2,500
Payment Center, 86 Annex
Atlanta, GA 30386-0001


TRANSCOM ENHANCED: Bankruptcy Court Rules Against AT&T and SBC
--------------------------------------------------------------
The United States Bankruptcy Court for the Northern District of
Texas in Dallas ruled in favor of Transcom Enhanced Services and
against SBC Communications and AT&T on Transcom's status as an
enhanced services provider.  The ruling paves the way for Transcom
to resume its service agreement with AT&T and giving Transcom the
validation it needs to continue doing business.

"For months we have been held hostage by SBC's intimidation.  They
had been telling all Transcom customers and suppliers that we did
not qualify for the ESP exemption and to stop doing business with
us," said Transcom CEO Scott Birdwell.  "This ruling gave us the
vindication we needed to continue doing business by offering
quality services to our customers.  SBC did considerable damage
with their tactics, but we're still here and ready to serve our
loyal customer base."

The saga began in April 2004 when the FCC ruled that a specific
service offered by AT&T did not qualify for the ESP exemption.
SBC used this AT&T ruling against legitimate ESPs, like Transcom,
alleging that they were acting unlawfully.  SBC pressured AT&T and
other Transcom vendors and customers to stop doing business with
Transcom.  Coincidentally, right before the announced merger with
SBC, AT&T asked Transcom to produce a ruling on their status
within a period of days.  Transcom was forced to seek the
protection of the bankruptcy court due to SBC's economic pressure
and predatory practices.  As part of the bankruptcy process,
Transcom sought vindication of its position that it was an ESP
entitled to the exemption, and the court agreed.  In its ruling
the Court clearly outlined the unique factors that qualify
Transcom for the ESP exemption.

"The next step for us is to let our customers and suppliers in on
the good news," Mr. Birdwell said.  "As we always have maintained,
competition and innovation is a good thing, and with this ruling,
our customers and suppliers can feel safe doing business with us
again."

With the pending mergers between both AT&T and SBC and Verizon and
MCI, there is a growing concern that competition in the market
place will be quashed and innovation cast to the side.  This was
evidenced by the testimony of a group of competitive local
exchange carriers to the Senate Judiciary Committee last month
where it was estimated that the two giants will control 80 percent
of the market.

"SBC was acting in a monopolistic fashion with us -- like a big
bully, to put it more plainly," adds Mr. Birdwell.  "We bring an
innovative solution to the market, and we are taking away
customers from SBC.  SBC can't drive us out of business, and with
this new ruling, we are here to stay.  On a bigger scale, we feel
like this was a victory for free enterprise and for the little
guy."

Headquartered in Irving, Texas, Transcom Enhanced Services --
http://www.transcomus.com/-- specializes in the modification of
the form and content of telephone calls and other communications
to improve bandwidth efficiency, reduce costs and facilitate the
development and provision of advanced applications.  Established
in 2003, TES uses state-of-the-art technology and a secure,
privately managed packet-switched network to deliver cost-
effective custom voice-over-IP solutions and converged IP
applications to carriers and enterprise customers all over the
world.  The Company filed for chapter 11 protection on Feb. 18,
2005 (Bankr. N.D. Tex. Case No. 05-31929).  John Mark Chevallier,
Esq., at McGuire, Craddock & Strother represents the Debtor in its
restructuring efforts.  When the Debtor filed for protection from
its creditors, it estimated between $1 million to $10 million in
total assets and debts.


TRICOM SA: Losses, Defaults & Going Concern Doubts Continue
-----------------------------------------------------------
Tricom, S.A. reported increases in revenues during the first
quarter of 2005, as reported in the Troubled Company Reporter
earlier this week.  That was the good news.  The bad news is
recurring losses from operations, impacted further by the
recognition of impairment losses of long-term assets and
intangibles and a loss in the disposal of the Central America
operations, which have led the Company to default in its long and
short-term debt commitments.  These situations, among others, the
Company says raise substantial doubt about its ability to continue
as a going concern.

                        New Auditing Firm

That statement echoes what KPMG International said when it audited
the company's financial records for 2003.  KPMG was replace in
April 2005 by Sotomayor & Associates, LLP.  Sotomayor &
Associates, LLP is a Public Company Accounting Oversight Board
(PCAOB) registered independent public accounting firm with its
principal offices in Pasadena, California.  The firm has acted as
independent auditor to Tricom USA, the Company's wholly owned
subsidiary in the United States, since 1999.

                      Annual Report Delayed

On November 4, 2004, the Company announced that the filing of the
Company's Annual Report on Form 20-F for the year ended December
31, 2003 was being delayed pending further clarification of the
purchase, in December 2002, of 21,212,121 shares of Tricom's Class
A common stock by a group of investors for an aggregate purchase
price of approximately US$70 million with funds loaned to the
investors by a bank formerly affiliated with GFN Corp., Tricom's
largest shareholder.  Tricom's Board of Directors has appointed a
special committee to examine and provide an independent review and
evaluation of the above-mentioned transaction.

                  Financial Restructuring Update

Since October 2003, the Company has suspended principal and
interest payments on its outstanding unsecured indebtedness and
principal payments on its secured indebtedness.  As a result, the
Company is in default with respect to its outstanding
indebtedness, approximately $400 million principal amount as of
December 31, 2004.

As previously announced, the Company continues to engage in
discussions with the holders of its indebtedness, which includes
an ad hoc committee of holders of its 11-3/8 percent Senior Notes
due 2004, regarding an agreement on a consensual financial
restructuring of its balance sheet.  The Company's future results
and its ability to continue operations will depend on the
successful conclusion of the restructuring of its indebtedness.

Since these negotiations are ongoing, the value and treatment of
the Company's existing secured and unsecured obligations, as well
as that of the interest of its existing shareholders, is uncertain
at this time.  Even if a restructuring can be completed, the value
of the Company's existing debt securities and instruments is
expected to be substantially less than the current recorded face
amount of such obligations, and investors in the Company's equity
interests, including the American Depository Shares, are expected
to receive little or no value with respect to their investment.

                           About Tricom

Tricom, S.A. -- http://www.tricom.net/-- is a full-service
communications services provider in the Dominican Republic.  The
Company offers local, long distance, mobile, cable television and
broadband data transmission and Internet services.  Through Tricom
USA, the Company is one of the few Latin American-based long
distance carriers that are licensed by the U.S. Federal
Communications Commission to own and operate switching facilities
in the United States.  Through its TCN Dominicana, S.A.
subsidiary, the Company is the largest cable television operator
in the Dominican Republic based on our number of subscribers and
homes passed.

At March 31, 2005, Tricom's balance sheet showed a $214,972,000
stockholders' deficit, compared to a $195,733,000 deficit at
Dec. 31, 2004.


UAL CORP: Posts $1.1 Billion Net Loss in First Quarter 2005
-----------------------------------------------------------
UAL Corporation (OTC Bulletin Board: UALAQ), the holding company
whose primary subsidiary is United Airlines, reported its first-
quarter 2005 financial results.

UAL reported a first-quarter operating loss of $250 million due
primarily to continuing high fuel costs.  This compares with a
$211 million operating loss in the first quarter of 2004.  UAL
reported a net loss of $1.1 billion, or a loss per basic share of
$9.23, which includes $768 million in reorganization items.
Reorganization items include two large non-cash items:

   -- a curtailment charge of $433 million related to the Pension
      Benefit Guaranty Corporation's (PBGC) motion to terminate
      the company's defined benefit pension plan for ground
      employees, and

   -- $294 million in charges related to the rejection of
      aircraft.

Excluding the reorganization items, UAL's net loss for the first
quarter totaled $302 million, or a loss per basic share of $2.62.

Resolving one of the most significant issues remaining in the
company's restructuring, on Tuesday the Bankruptcy Court approved
an agreement with the PBGC which provides for the settlement and
compromise of various disputes and controversies with respect to
United's defined benefit pension plans.

"In an extremely tough industry environment, we made progress in
executing our business plan," said Glenn Tilton, United's
chairman, CEO and president.  "By maintaining focus on United's
customers, our employees turned in operational performance near
top levels in the company's history.  Our revenue plan is also
tracking well against the reallocation of capacity to robust
international markets, with more improvement to come.  Progress to
reduce costs throughout the system has been substantial and we are
pressing ahead to further reduce costs and inefficiencies in all
areas of the business."

            United's Restructuring Progress Continues

Thus far in 2005, United continued to advance its restructuring
activities. As part of the recent restructuring efforts, United:

  -- Requested and received Bankruptcy Court approval to extend
     until July 1, 2005 its exclusive right to file a Plan of
     Reorganization for the company, with the support of the
     company's Official Committee of Unsecured Creditors;

  -- Reached ratified labor agreements with four of its six unions
     and the company continues to work with the remaining unions
     to reach consensual agreements; and

  -- Received Court approval of a settlement agreement with the
     PBGC regarding the termination of all of United's defined
     benefit pension plans

Jake Brace, United's executive vice president and chief financial
officer, said, "Termination and replacement of the pension plans
is something we tried very hard to avoid, but it simply proved
unavoidable.  This is a difficult but necessary step which will
move us significantly closer to exiting bankruptcy as a
sustainable, viable enterprise."

                       Revenue results

Results for the first quarter of 2005 reflect a 2 percent
reduction in system capacity compared with the same period last
year.  During the quarter, passenger unit revenue decreased 1
percent and yield decreased 4 percent, compared to first quarter
last year.  Excluding $60 million of out-of-period revenue
adjustments in the first quarter of 2004, United's system
passenger revenue per available seat mile increased 1.3 percent,
outpacing average industry performance.  On a domestic mainline
capacity decrease of 10 percent and again excluding the domestic
portion of the revenue adjustment, United's domestic passenger
revenue per available seat mile increased 1.0 percent, also
outpacing average industry performance.  System load factor
increased 3 points to 78.2 percent, as traffic increased 2
percent.  United is pleased with the results of its decisions to
move capacity to international markets and to address the issue of
overcapacity on domestic routes.

                      Operating Expenses

Total operating expenses for the quarter were $4.2 billion, up 1
percent from the year-ago quarter on a 2 percent decrease in
capacity -- largely driven by fuel. Excluding UAFC and fuel,
mainline operating expenses per available seat mile decreased 4
percent.

Salaries and related costs were down 17 percent, or $216 million,
primarily reflecting recent labor and management cost reductions
and a 5 percent reduction in manpower.  Fuel expense was $202
million higher than in the first quarter 2004.  Average fuel price
for the quarter was $1.46 per gallon (including taxes), up 36
percent year-over-year.

The company had an effective tax rate of zero for all periods
presented, which makes UAL's pre-tax loss the same as its net
loss.

                             Cash

The company ended the quarter with an unrestricted cash balance of
$1.4 billion, and a restricted cash balance of $885 million, for a
total cash balance of $2.3 billion. The cash balance increased by
$167 million during the quarter.

"The fact that United is cash-flow positive in the face of record
fuel costs demonstrates that restructuring is delivering results,"
Brace added.

                          Operations

During the first quarter, the annual Airline Quality Rating (AQR)
study conducted by Wichita State University was released.
According to the study, United was one of only four airlines --
and the only major U.S. carrier -- that improved service in 2004.
Among the seven major carriers, United was number one in on-time
arrivals for the twelve months ending March 2005, as reported by
the U.S. Department of Transportation's May, 2005 Air Travel
Consumer Report.

In addition, employee productivity (available seat miles divided
by employee equivalents) was up 4 percent for the quarter compared
to the same period in 2004.

                           Outlook

United expects second-quarter system mainline capacity to be down
about 3 percent year-over-year.  System mainline capacity for 2005
is expected to be about 3 percent lower than 2004.

The company projects fuel prices for the second quarter, including
taxes and excluding the impact of hedges, to average $1.66 per
gallon.  The company has 20 percent of its expected fuel
consumption for the second quarter hedged at an average of $1.31
per gallon, including taxes.  Even if fuel prices are in the mid-
fifty U.S. dollar per barrel range, United projects it would
generate positive operating cash flow in the second quarter.

United has made significant progress toward achieving the economic
structure the company must have to build a competitive,
sustainable business.  United expects to see continued
improvements in the second quarter as the company realizes the
positive effects of additional restructuring savings, a shift in
capacity to international markets, and business improvements
initiatives already underway.

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.


UAL CORPORATION: Flight Attendants Want Management Replaced
-----------------------------------------------------------
The Association of Flight Attendants-CWA, AFL-CIO United Airlines
Master Executive Council President Greg Davidowitch made the
following statement regarding bankruptcy court approval of the
settlement agreement between United Airlines and the Pension
Benefit Guarantee Corporation (PBGC):

     "[May 10] 's decision is an enormous disappointment and it
very well may have triggered the collapse of the defined benefit
pension system nationwide.

     "We are reviewing our legal options, including an appeal of
Tuesday's ruling and a possible suit against the PBGC over the
termination of our pension plan.  We await the judge's written
ruling before making final plans.  Our fight is far from over.

     "We are not on strike at this time, but Flight Attendants
have overwhelmingly authorized the use of CHAOST Strikes to
protest any unilateral change to our Contract.  CHAOS is a
strategy of intermittent strikes that could take the form of a
nation-wide strike for a day or a week, a single city for an
afternoon, or a single flight at a remote location.  Actual CHAOS
targets are a closely guarded secret.

     "We are gravely concerned for the success of our airline and
the inept and dishonest actions of this management.  Flight
Attendants have proven our dedication to our airline through
outstanding service even in the face of life-altering
sacrifices.  Meanwhile executives have lined their pockets with
raises and bonuses while running our airline into the ground and
initiating a labor relations war.

     "This management appears incapable of understanding the
obvious: it cannot run a service industry business while waging
war on its employees.

     "This management has failed at every turn during United's 29
months of bankruptcy and they still fail to have a viable
business plan.  Now they have failed at labor relations.  Either
they go or we go.  The United Airlines Board of Directors must
act quickly to replace this management team before they destroy
this airline with their incompetence."

                     AFA-MEC President Letter

     Topic: Management Must Be Replaced for Survival of United
            Airlines


     May 10, 2005

     Ladies and Gentlemen:

     Today in federal bankruptcy court, Judge Wedoff ruled to
     approve a settlement agreement with the Pension Benefit
     Guarantee Corporation (PBGC) that is expected to result in
     the termination of our pension plan.  The court decision is
     an enormous disappointment and in addition to the effect on
     our pension plan, it very well may have triggered the
     collapse of the defined benefit pension system nationwide.
     In return for $1.5 billion dollars from United, the Company
     expects that the PBGC will approve the termination of our
     plan and the three other defined benefit plans covering
     United employees.  Ironically, Glenn Tilton found a way to
     save one pension plan -- his own.  It's time for him to go.

     United's Section 1113(c) motion to reject our Contract has
     been withdrawn and our opportunity to defend our pension
     plan through the bankruptcy process has been halted by the
     court.  It's now up to the PBGC to determine whether the
     plans are to be terminated in accordance with its rules.
     Every expectation is that they will do so within 10 days.
     We would, in theory, be able to challenge the PBGC's
     decision separately, but the legal standard would require us
     to show the agency 's action is "arbitrary," an almost
     impossible standard.

     While we will renew our calls for the PBGC to reconsider its
     decision to enter into this settlement, we are reviewing our
     legal options to appeal the termination of our pension plan.
     We await the judge's written ruling before making final
     plans.  One thing should be clear: our fight is far from
     over.

     This is the end of labor relations at United Airlines with
     Glenn Tilton and his henchmen at the helm.  The United
     Airlines that we have worked so hard to build is gone.  Our
     efforts today are focused on creating a new airline from the
     ashes of the old and we will do this by employing escalating
     CHAOS(TM) activities focused on bring down this management
     group.  The decisions that they have made are short-sighted,
     destructive and are contrary to a successful reorganization.

     This management team has long since proven it cannot run an
     airline.  Now it has shown that it has no common sense - you
     cannot run a service business while waging war on your front
     line employees.  The United Board of Directors must act
     quickly to remove these executives before they destroy this
     airline.

     We are gravely concerned for the success of our airline and
     the inept and dishonest actions of this management.  We have
     proven our dedication to our airline through service and
     life-altering sacrifices.  Meanwhile executives have run our
     airline into the ground and have engaged us in a labor
     relations war.  There can be no labor peace with a
     management that has destroyed our pensions.

     We will attend bankruptcy court tomorrow and stand in
     solidarity with our Union brothers and sisters in the
     International Association of Machinist and Aerospace Workers
     (IAM) who will be defending against rejection of their
     Contract.

     It should be clear that we are not on strike at this time,
     but you have overwhelmingly authorized the use of CHAOS
     strikes to protest any unilateral change to our Contract.
     This management has failed at every turn during United's 29
     months of bankruptcy and they still fail to have a viable
     business plan.

     Our message is clear: either they go or we go.  We will
     institute legal CHAOS strikes to rid our airline of these
     executives and save United Airlines.  It will be clear to
     you in the event a CHAOS strike is initiated, do not take
     action on your own as CHAOS is a strategic and coordinated
     campaign designed for maximum impact to further our goals.

     Stay closely informed through all AFA communication channels
     as we stand in solidarity for our airline and our careers.

     In Solidarity,

     Greg Davidowitch, President
     United Master Executive Council

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


UAL CORP: Pension Plan Termination May Reduce PBGC Deficit
----------------------------------------------------------
A fact sheet by the American Academy of Actuaries explains how the
termination of United Airlines' pension plans as part of its
bankruptcy proceedings will impact the Pension Benefit Guaranty
Corporation -- PBGC, the federal agency that insures defined
benefit pension plans.

As reported in the Troubled Company Reporter on May 12, 2005, the
Honorable Eugene Wedoff of the U.S. Bankruptcy Court for the
Northern District of Illinois put his stamp of approval on United
Airlines' plan to terminate its employees' pension plans -- the
largest pension plan default in U.S. history.  About 120,000
current and retired United employees are affected by the Court's
decision.

Under the terms of the agreement, the PBGC would terminate and
become trustee of the company's four pension plans and the
agency's multi-billion dollar claims against the carrier will be
settled.  The PBGC and its financial advisers believe the
settlement is superior to the recovery the agency would have
received as an unsecured creditor in bankruptcy.

Collectively, United's pension plans are underfunded by $9.8
billion on a termination basis, $6.6 billion of which is
guaranteed, according to the PBGC.  The four plans are:

    -- the UA Pilot Defined Benefit Plan, which covers
       14,100 participants and has $2.8 billion in assets
       to pay $5.7 billion in promised benefits;

    -- the United Airlines Ground Employees Retirement Plan,
       which covers 36,100 participants and has $1.3 billion
       in assets to pay $4.0 billion in promised benefits;

    -- the UA Flight Attendant Defined Benefit Pension Plan,
       which covers 28,600 participants and has $1.4 billion
       in assets to pay $3.3 billion in promised benefits; and

    -- the Management, Administrative and Public Contact Defined
       Benefit Pension Plan, which covers 42,700 participants
       and has $1.5 billion in assets to pay $3.8 billion in
       promised benefits.

The Pension Benefit Guaranty Corporation will assume
responsibility for United's pension obligations.  The PBGC
originally opposed United's plan, but agreed to the distressed
termination in exchange for $1.5 billion of new preferred
securities that must be issued under any plan of reorganization
confirmed in United's chapter 11 cases.

Contrary to some reports in the media, the termination of UAL's
pension plans will likely not increase the PBGC's projected
deficit, and may even help to reduce it.

"The PBGC already included United Airlines' pension plans as a
'probable termination' in its 2004 annual report.  That means the
termination of the plans will have no appreciable impact on the
PBGC's deficit," said Ron Gebhardtsbauer, senior pension fellow at
the American Academy of Actuaries.  "In fact, the $1.5 billion in
securities the PBGC may receive as part of the termination
agreement could help to reduce the PBGC's deficit."

According to the PBGC's 2004 annual report, it had a $23.3 billion
deficit, which included $16.9 billion for probable terminations.
"The PBGC had the foresight to include the liabilities it has
assumed from United Airlines' pension plans in its deficit
projections," said Gebhardtsbauer.

The Academy has proposed a series of legislative and regulatory
reforms to strengthen the defined benefit pension system. For
further information go to the Academy website at
http://www.actuary.org/

The American Academy of Actuaries is the nonpartisan public policy
organization for the U.S. actuarial profession. The Academy
provides independent analysis to elected officials and regulators,
maintains professional standards for all actuaries, and
communicates the value of actuarial work to the media and the
public.

The following is the fact sheet on PBGC and United Airlines:

                    PBGC and United Airlines

      How does United's termination affect the PBGC deficit?

The American Academy of Actuaries Pension Practice Council
provides this educational fact sheet to discuss recent statements
regarding the termination of United Airlines' pension plans and
the impact that termination will have on the financial situation
of the Pension Benefit Guaranty Corp (PBGC).

                              ******************

On May 10, a bankruptcy judge approved United Airlines' request to
terminate its pension plans. The PBGC will take over the UAL
pension plans. In return, the PBGC may receive up to approximately
$1.5 billion in securities for the reorganized airline.

United's total unfunded accrued benefits: $9.8 billion

United's unfunded guaranteed benefits: $6.6 billion

The PBGC does not take on the total amount of unfunded accrued
benefits, which in United's case is $9.8 billion. It will not pay
the $3.2 billion in nonguaranteed benefits, which consists of
certain benefits above the maximum guaranteed and recent benefit
improvements that have not be fully phased-in. The maximum
guaranteed benefit for plans terminated in 2005 is $3801.14 per
month (or $45,613.68 per year) for a worker retiring at age 65.
There is a lower guarantee for those individuals who retire early
or if there is a benefit for a survivor.

     Total unfunded accrued benefits:    $ 9.8 billion
     Non-guaranteed benefits:          - $ 3.2 billion
                                         -------------
     Unfunded guaranteed benefits:       $ 6.6 billion

PBGC's deficit according to their 2004 Annual Report was
$23.3 billion, which included United's plans.

The PBGC includes, in their deficit, certain probable terminations
(i.e., companies for which PBGC anticipates taking over pension
plans in the near future). In its 2004 annual report, the PBGC
included $16.9 billion for certain probable terminations, which
included United Airlines' unfunded guaranteed benefits. Therefore,
despite some reports to the contrary, PBGC's deficit does not
increase with United's termination. In fact, the $1.5 billion in
securities from UAL could decrease the PBGC deficit.

Headquartered in Chicago, Illinois, UAL Corporation --
http://www.united.com/-- through United Air Lines, Inc., is the
holding company for United Airlines -- the world's second largest
air carrier.  The Company filed for chapter 11 protection on
December 9, 2002 (Bankr. N.D. Ill. Case No. 02-48191).  James H.M.
Sprayregen, Esq., Marc Kieselstein, Esq., David R. Seligman, Esq.,
and Steven R. Kotarba, Esq., at Kirkland & Ellis, represent the
Debtors in their restructuring efforts.  When the Debtors filed
for protection from their creditors, they listed $24,190,000,000
in assets and $22,787,000,000 in debts.


US AIRWAYS: Asks Court to Allow Sabre's $7,131,989 Admin. Claim
---------------------------------------------------------------
Pursuant to a Global Distribution (Reservations) System and a
Participating Carrier Agreement, US Airways, Inc., and its debtor-
affiliates provide Sabre, Inc., with schedules, inventory, fares,
fare rules, and seat availability.  The Debtors pay Sabre to
distribute this information to its subscribers, who in turn sell
air travel on the Debtors' flights.  The Debtors pay Sabre through
the Airlines Clearing House system.  Brian P. Leitch, Esq., at
Arnold & Porter, in Denver, Colorado, says that the Debtors have
outstanding prepetition obligations to Sabre.

On September 14, 2004, the Court issued the Interline Order,
which authorized the Debtors to assume executory contracts
relating to the Airline Clearinghouse Agreement, Interline
Agreements and other Agreements.  The Interline Order authorized
the Debtors to assume the ACH Contract, which facilitated the
settlement of interline accounts though the ACH system.

After the Petition Date, the Debtors decided not to pay the
Prepetition Obligations owed to Sabre under the PCA.  As a
result, the Debtors' Prepetition Obligations to Sabre remain
outstanding.  In response to the Debtors' nonpayment of the
Prepetition Obligations, Sabre filed a request for mediation
under ACH rules with the Secretary-Treasurer of the ACH.  Sabre
asserts it is entitled to payment of the Prepetition Obligations,
plus interest and attorney's fees.

To avoid the costs of mediation of the dispute and the associated
uncertainties, the parties negotiated a Settlement Agreement.
Pursuant to Section 503(b)(1)(A) of the Bankruptcy Code, the
Debtors ask the Court to allow Sabre an administrative claim for
$7,131,989, to be paid on the effective date of a plan of
reorganization.  This amount excludes interest and attorney's
fees.

Mr. Leitch emphasizes that the Settlement Agreement represents a
fair resolution of the pending ACH billing dispute,
interpretation of the ACH rules and procedures, and the legal
effect of the Interline Order.  The Settlement Agreement avoids
the costs, delay and uncertainty of further mediation or
litigation on this matter.  The Settlement Agreement helps the
Debtors conserve cash by delaying payment of the Prepetition
Obligations.

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


USG CORP: Gets Court Nod to Amend $100M LaSalle L/C Facility
------------------------------------------------------------
The U.S. Bankruptcy Court for the District of Delaware allowed USG
Corporation and its debtor-affiliates to amend the $100 million
postpetition letter of credit facility with LaSalle Bank National
Association.

The Debtors sought to amend the L/C Facility amendment for two
main reasons:

   (1) The Debtors require an increase in the size of the L/C
       Facility because they anticipate greater letter of credit
       needs for general corporate purposes, including insurance,
       environmental and foreign trade credit purposes; and

   (2) USG Corporation will have access to the L/C Facility only
       until April 30, 2006, pursuant to the original agreement.

Specifically, the Debtors wished to replace $36,040,189 of
prepetition letters of credit with postpetition letters of credit
issued under the L/C Facility.  Bruce A. Czyl, the Director of
Risk Management for USG, explained that the Existing Letters of
Credit are "evergreen" letters of credit that backstop various
insurance, workers' compensation, environmental, reclamation and
other obligations of the Debtors.

In addition, the Amendment extends the maturity date of the L/C
Facility until April 30, 2008.

Paul N. Heath, Esq., at Richards, Layton & Finger, P.A., in
Wilmington, Delaware, told Judge Fitzgerald that the terms of
the L/C Facility will continue to be superior to the Previous DIP
Facility in several respects, including allowing the Debtors to
have letter of credit availability at a reduced cost and without
restrictive covenants that limit the Debtors' flexibility in
operating their businesses.

                   Previous DIP Facility    L/C Facility
                   ---------------------    -----------
  Obligors         All Debtors              USG

  Commitment       $350 million             $100 million,
                                            increased to
                                            $175 million

  Availability     Subject to a borrowing   No borrowing base
                   Base

  Commitment Fee   50 basis points          25 basis points

  L/C Fee          200 basis points         50 basis points

  Fronting Fee     25 basis points          None
  For Letter of
  Credit Issuances

  Administrative   Approximately $175,000   None
  Agent Fee        annually

  Covenants        Various affirmative      None
                   and negative financial
                   and operating covenants

  Security         All of the Debtors'      Cash or property
                   assets                   equal to 103% of the
                                            face amount of each
                                            letter of credit
                                            outstanding

Under the L/C Facility, if USG requests that LaSalle issue a
letter of credit, USG is required to post cash, cash equivalents
or other property with LaSalle for 103% of the face amount of
that letter of credit.  If the letter of credit is drawn, LaSalle
is further authorized to obtain that property notwithstanding the
automatic stay as reimbursement for its obligation to pay the
holder of the letter of credit and for certain fees under the
L/C Facility.  Mr. Heath relates that granting a lien to LaSalle
in property to secure letter of credit obligations and permitting
it to obtain property if a letter of credit is drawn are
customary terms in letter of credit facilities of similar type.

The Court also:

   * continued to authorize the Debtors to grant LaSalle a lien in
     the cash or other property used to secure their reimbursement
     obligations under the L/C Facility; and

   * modified the automatic stay to permit LaSalle to obtain that
     property if a letter of credit is drawn.

Headquartered in Chicago, Illinois, USG Corporation --
http://www.usg.com/-- through its subsidiaries, is a leading
manufacturer and distributor of building materials producing a
wide range of products for use in new residential, new
nonresidential and repair and remodel construction, as well as
products used in certain industrial processes.  The Company filed
for chapter 11 protection on June 25, 2001 (Bankr. Del. Case No.
01-02094).  David G. Heiman, Esq., and Paul E. Harner, Esq., at
Jones Day represent the Debtors in their restructuring efforts.
When the Debtors filed for protection from their creditors, they
listed $3,252,000,000 in assets and $2,739,000,000 in debts.  (USG
Bankruptcy News, Issue No. 86; Bankruptcy Creditors' Service,
Inc., 215/945-7000)


USG CORP: Has Until Sept. 1 to Make Lease-Related Decisions
-----------------------------------------------------------
The U.S. Bankruptcy Court for the District of Delaware extended
the deadline before which USG Corporation and its debtor-
affiliates can assume, assume and assign, or reject any
prepetition unexpired non-residential real property lease through
and including September 1, 2005.

Paul N. Heath, Esq., at Richards, Layton & Finger, P.A., in
Wilmington, Delaware, told Judge Fitzgerald that the Debtors have
approximately 185 real property leases.

Headquartered in Chicago, Illinois, USG Corporation --
http://www.usg.com/-- through its subsidiaries, is a leading
manufacturer and distributor of building materials producing a
wide range of products for use in new residential, new
nonresidential and repair and remodel construction, as well as
products used in certain industrial processes.  The Company filed
for chapter 11 protection on June 25, 2001 (Bankr. Del. Case No.
01-02094).  David G. Heiman, Esq., and Paul E. Harner, Esq., at
Jones Day represent the Debtors in their restructuring efforts.
When the Debtors filed for protection from their creditors, they
listed $3,252,000,000 in assets and $2,739,000,000 in debts.  (USG
Bankruptcy News, Issue No. 86; Bankruptcy Creditors' Service,
Inc., 215/945-7000)


VECTOR GROUP: March 31 Balance Sheet Upside-Down by $19.1 Million
-----------------------------------------------------------------
Vector Group Ltd. (NYSE: VGR) reported its financial results for
the first quarter ended March 31, 2005.  First quarter 2005
revenues were $104.2 million, compared to revenues of $126.6
million for the first quarter of 2004.  The Company recorded
operating income of $18.6 million for the 2005 first quarter,
compared to operating income of $12.8 million for the first
quarter of 2004.

Income from continuing operations for the 2005 first quarter was
$8.3 million, compared to income from continuing operations of
$4.5 million, for the 2004 first quarter.  Net income for the 2005
first quarter was $11.3 million, or $.26 per diluted share,
compared to $4.6 million, or $0.11 per diluted share, for the 2004
first quarter.

For the three months ended March 31, 2005, the Company's
conventional cigarette business, which includes Liggett Group
cigarettes and USA brand cigarettes, had revenues of $101.6
million, compared to $122.2 million for the three months ended
March 31, 2004.  Operating income was $31.9 million for the first
quarter of 2005, compared to $27.8 million for the first quarter
of 2004.  The 2004 results for the conventional cigarette business
included a pre-tax restructuring charge of $0.4 million.

                        About the Company

Vector Group -- http://www.vectorgroupltd.com/-- is a holding
company that indirectly owns Liggett Group Inc., Vector Tobacco
and a controlling interest in New Valley Corporation.

At March 31, 2005, Vector Group's balance sheet showed a deficit
of $91,171,000 stockholders' deficit, compared to a $84,803,000
deficit at Dec. 31, 2004.


VISTEON CORP: Accounting Irregularities & Cash Flow Warning
-----------------------------------------------------------
Visteon Corporation (NYSE:VC) said this week that it would delay
the filing of its Quarterly Report on Form 10-Q for the quarterly
period ended March 31, 2005.  This action is the result of the
decision by the Audit Committee of the Board of Directors, as
recommended by the company's management, to conduct an independent
review of the accounting for certain transactions originating
primarily in the company's North American purchasing activity.

During the preparation of Visteon's first quarter 2005 Form 10-Q,
the company's management identified errors in its accruals for
costs principally associated with freight and material surcharges
that relate to prior periods.  During the course of the company's
internal review, allegations of potential improper conduct by a
former senior finance employee responsible for the accounting
oversight for North American purchasing activities were raised.
As a result of these allegations, the Audit Committee intends to
engage outside accounting and legal advisors to further
investigate these matters.

As a result of its internal review, to date, Visteon's management
has identified two items which were recorded in the company's
first quarter 2005 unaudited financial results as previously
reported on April 27, 2005 that relate to prior periods:

    (a) Approximately $13 million of freight expense payable to
        third party North American transportation providers for
        services rendered prior to the end of 2004; and

    (b) Approximately $18 million of material surcharges payable
        to North American suppliers of certain raw materials used
        in the manufacture of the company's products that were
        incurred prior to the end of 2004.

As the Audit Committee's independent investigation is just
commencing, Visteon is not able to determine whether these items
or any other adjustments that may be identified will require
restatement of prior period results or further adjustments to the
previously reported first quarter 2005 financial results.

Therefore, Visteon is not currently able to determine the effects
of all potential adjustments to its results of operations for any
particular period, or whether these or other errors will result in
the determination that one or more additional material weaknesses
in the company's internal control over financial reporting exist
for purposes of Section 404 of the Sarbanes-Oxley Act.  While the
Audit Committee intends to conduct its investigation in an
expedient manner, Visteon cannot provide an estimate of when the
first quarter 2005 Form 10-Q, or if necessary, any amended SEC
filings, will be made.

                    Ford Discussions and Liquidity

Visteon has been exploring strategic and structural changes to its
business in the United States that would involve restructuring its
agreements with Ford. Visteon and Ford have been discussing a
concept designed to address operating needs of both companies.
Recent discussions with Ford have been constructive and are
progressing, Visteon says, and the delay in filing its first
quarter 2005 Form 10-Q is not expected to impact these
discussions.

Absent significant structural changes to Visteon's U.S. business,
including an agreement with Ford that will allow the company to
achieve a sustainable and competitive business model, Visteon
believes that cash flow from operations, including the impact of
the Ford funding agreement, will not be sufficient to fund capital
spending, debt maturities and other cash obligations in 2005, and,
therefore, Visteon will need to incur additional debt.

Liquidity from internal or external sources to meet these
obligations is dependent on a number of factors, including
availability of cash balances and access to borrowing facilities
and/or capital markets.  Visteon isn't sure the liquidity it will
need will be available at the times or in the amounts needed, or
on terms and conditions acceptable to Visteon, because of the
uncertainty regarding economic and market conditions, as well as
the ultimate outcome of our strategic and structural discussions
with Ford.

At March 31, 2005, Visteon was in compliance with its covenants
relating to its existing credit facilities, although given current
market conditions and the need to complete strategic and
structural discussions with Ford, Visteon says there's no
assurance that it will remain in compliance with those covenants
in the future, especially during the third quarter which normally
requires the use of liquidity resources due to seasonal effects.

If a covenant were violated and not cured within 30 days, or
otherwise waived, the availability of the company's credit
facilities could be withdrawn, and repayment of outstanding
borrowings could be accelerated.  In this event, Visteon would
seek to replace its existing credit facilities with other credit
facilities or secured borrowings, although the company cannot
provide assurance that sufficient replacement sources would be
available.

In addition, the company's credit facilities and bond indenture
require it to submit interim financial information within
prescribed time periods.  Although Visteon's failure to file its
first quarter 2005 Form 10-Q does not result in immediate non-
compliance under such agreements, a significant delay in
completing the investigation and submitting its Form 10-Q could
result in non-compliance in the future.

                  Exploring Financing Alternatives

In light of the upcoming expiration of Visteon's existing 364-day
revolving credit facility in June 2005, the company is actively
exploring its financing alternatives.  Given current market
conditions, the company's financial performance and its credit
ratings, any financing alternative will likely require
significantly more restrictive covenants and collateralization.

Visteon's ability to provide lenders with collateral at the times
and in amounts needed may be limited by the results, if any, of
its negotiations with Ford, restrictive covenants regarding
limitations on liens in its indenture and any contractual rights
that Ford may successfully assert to offset against payables to
Visteon amounts Ford claims are owed to it by Visteon.

In addition, the results of any discussions with Ford could
significantly impact the carrying value of certain assets and
related liabilities that support and are dependent upon Ford's
North American business.

                      The 364-Day Revolver

VISTEON CORPORATION, as Borrower, is party to a 364-DAY CREDIT
AGREEMENT dated as of June 18, 2004, with a Lending Consortium led
by JPMORGAN CHASE BANK, as Administrative Agent, and CITIBANK,
N.A., as Syndication Agent.  The Lenders' aggregate commitments
under that facility total $565,000,000.  As of December 31, 2004,
there were no outstanding borrowings under the 364-day facility.
Visteon also has a $775,000,000 five-year revolving credit line in
place which expires June 2007.  As of December 31, 2004, there
were no outstanding borrowings under 5-year facility, although
$100 million of obligations under stand-by letters of credit have
been issued against the 5-year facility.

Visteon is also the borrower under a $250,000,000 delayed-draw
term loan expiring in 2007, which is used primarily to finance new
construction for the Company's facilities consolidation in
Southeast Michigan.  As of December 31, 2004, Visteon had borrowed
$223 million against the delayed-draw term loan facility.

                         About Visteon

Visteon Corporation is a leading full-service supplier that
delivers consumer-driven technology solutions to automotive
manufacturers worldwide and through multiple channels within the
global automotive aftermarket. Visteon has about 70,000 employees
and a global delivery system of more than 200 technical,
manufacturing, sales and service facilities located in 25
countries.


VISTEON CORP: Form 10-Q Filing Delay Cues Moody's to Pare Ratings
-----------------------------------------------------------------
Moody's Investor Service has lowered the senior implied and senior
unsecured ratings of Visteon Corporation to B3 from B1 and the
Speculative Grade Liquidity Rating to SGL-4 from SGL-3.

The actions follow a recent announcement from the company that it
will delay the filing of its quarterly report on Form 10-Q for its
first quarter of 2005 due to the recent identification of errors
in its accruals for costs principally associated with freight and
material surcharges that relate to prior periods.  In addition,
the Audit Committee of Visteon's Board of Directors has determined
that the company will conduct an independent review of the
accounting for certain transactions originating in the company's
North American purchasing activity.

While Moody's noted that the amounts involved in the accounting
errors identified are moderate, the delay in providing financial
statements could further impair the company's efforts to implement
a needed business restructuring.  Visteon has been in negotiations
with Ford Motor Company to implement a longer-term solution to its
uncompetitive cost structure and business difficulties.  While a
successful resolution to those negotiations with Ford would be
helpful to the Visteon credit and would be considered in the
future positioning of the rating, the new accounting developments
create additional uncertainty and complexity to the company's
current liquidity profile, and result in the further rating
downgrade.

Although Visteon has indicated that failure to file with the SEC
within prescribed time frames does not immediately result in
non-compliance with the terms and conditions of its revolving
credits, significant delays in completing the investigation and
delivering financial statements to its lenders could result in
non-compliance and impair access to the facilities.  Further,
failure to file financial statements could result in
non-compliance with the terms of its indentures on its unsecured
notes.  Continued access to external sources of funding will be
critical to any business restructuring program which Visteon might
pursue.  Given the current state of its operations and cash flows,
even with the benefits of the Ford funding agreement announced
earlier in 2005, the company has stated that cash flow from
operations "will not be sufficient to fund capital spending, debt
maturities and other cash obligations in 2005."  Should Visteon be
unable to resolve the accounting matters in a timely fashion and
sustain adequate sources of external funding, near term cash
requirements could result in a significant erosion of liquidity
even if a successful restructuring arrangement is negotiated with
Ford.  Consequently, the ratings continue under review for
possible further downgrade.

Specifically these ratings were downgraded:

   -- Visteon Corporation

      * Senior implied rating to B3 from B1,

      * senior unsecured issuer rating to B3 from B1,

      * senior unsecured debt to B3 from B1,

      * shelf rating for senior unsecured to (P)B3 from (P)B1,

      * shelf rating for subordinated to(P)Caa2 from (P)B3,

      * shelf rating for preferred shares to (P)Caa3 from (P)Caa1,
        and

      * Speculative Grade Liquidity Rating to SGL-4 from SGL-3

   -- Visteon Capital Trust I:

      * shelf rating for trust preferred to (P)Caa2 from (P)B3

Visteon's current liquidity profile consists of $809 million of
cash reported on its un-audited balance sheet at March 31, 2005,
approximately $1.3 billion of committed revolving credits, a
$100 million accounts receivable securitization facility, and
$75 million of committed bilateral credit facilities.  However,
the 364 day portion of Visteon's revolving credit facility is due
to expire in June 2005, and if not extended; would leave only the
$775 million term revolver, maturing in June 2007. At March 31,
2005 the company reported about $80 million of drawings under its
revolvers, and the company had utilized about $100 million of the
facility for letters of credit as of 12/31/04. Bilateral credit
commitments also had roughly $50 million of letters of credit
issued under their commitments. Importantly, the company faces a
$250 million maturity of existing notes in August which will
require refinancing. At the end of March the company also had $234
million outstanding under its delayed draw term loan. Should the
company not be able to deliver within prescribed time frames
financial statements under those agreements, or be able to amend
or waive such requirements, it may lose the ability to access
remaining unused commitments or, subject to certain cure periods
and procedures, face an acceleration of claims or requests for
collateral. The company was in compliance with its financial
covenant applicable to its bank credit facilities at year-end
2004. However, it has also cited that it can provide no assurance
it will remain in compliance with such covenants in the future,
especially during the third quarter which normally requires the
use of liquidity resources due to seasonal effects.

Similarly, the indentures for Visteon's approximately $1.4 billion
of unsecured notes also have reporting obligations. Significant
delays in complying with that requirement could, subject to
procedures and actions required by a stipulated percentage vote of
security holders and subsequent actions by the trustee, and/or
cross default provisions, also lead to accelerated claims.
Consequently the liquidity profile of the company has become more
clouded, its potential access to needed liquidity reserves could
come into question, and additional uncertainty has arisen as to a
resolution of the longer term strategic restructuring actions and
business agreements with Ford.

The review will continue to focus on the ultimate terms and timing
of the Ford/Visteon strategic restructuring agreement, factors
that could impair the timing and implementation of a
restructuring, and alternative strategies available to Visteon if
such a restructuring agreement is not reached or quickly
implemented. It will consider the financial and business profile
of Visteon and its ability to achieve a more competitive business
model and cost structure in the current production environment in
North America as well as globally. Further, it will assess the
sufficiency of support from Ford under the current funding
agreement to stabilize cash flow and other financial metrics, the
evolution of the company's liquidity profile and financial
covenant compliance, and the terms and conditions of its borrowing
arrangements.

Visteon Corporation is a leading full-service supplier to
worldwide automotive manufacturers and the global automotive
aftermarket. The company has approximately 70,00 employees,
revenues of $18 billion in 2004, and a global delivery system of
more than 200 technical, manufacturing, sales and service
facilities located in 25 countries.


VISTEON CORP.: Form 10-Q Filing Delay Cues S&P to Lower Ratings
---------------------------------------------------------------
Standard & Poor's Ratings Services lowered its corporate credit
rating on Visteon Corp. to 'B-' from 'B+'.  The action reflects
concerns about Visteon's liquidity and ongoing viability after it
announced that its cash flow from operations will be insufficient
to fund obligations in 2005.  The company also faces bank covenant
violations.  And it has delayed the filing of its first quarter
10-Q because of an internal review of certain accounting errors.
This delay could eventually limit the company's access to its bank
credit facilities.

The rating remains on CreditWatch with developing implications,
where it was placed on April 20, 2005.  Developing implications
means that the rating could be raised or lowered pending the
outcome of critical discussions between Visteon and its former
parent, Ford Motor Co. (BB+/Negative/B-1).  Ford continues to be
Visteon's largest customer, but the two companies are
restructuring the terms of their relationship.  The interim
agreements should enhance Visteon's 2005 cash flow by about $500
million by providing for accelerated payment terms, wage
reimbursements, and sharing of capital expenditures.

Dearborn, Michigan-based Visteon has total debt of about $2.4
billion, and its total underfunded pension and other
postretirement employee benefits obligations were $2 billion as of
Dec. 31, 2004.

"Visteon has faced intense earnings and cash flow pressures as a
result of its high fixed costs, inflexible labor agreements, and
underperforming businesses," said Standard & Poor's credit analyst
Martin King.  "These factors exacerbate the growing challenges in
the automotive supply industry.  Visteon faces both reduced
vehicle production by its main customer and high raw material
costs."

Visteon and Ford are negotiating permanent structural changes to
Visteon's U.S. businesses in hopes of improving its long-term
financial results and competitive position.  These discussions
began more than six months ago, and industry conditions, along
with the financial position of both companies, have deteriorated
since then.

Nevertheless, the company needs a new agreement from Ford in the
next few months that substantially alters its cash flow profile.
Otherwise, its poor cash flow will cause the company to face
intense liquidity pressures.  Another stress on liquidity will be
the need for normal seasonal buildup of working capital, typically
peaking in August, which could total several hundred million
dollars.  A $250 million August bond maturity could further hamper
liquidity.

Visteon currently has access to a $1.3 billion credit facility,
however, the company will likely violate the covenants of this
facility within the next few quarters unless its earnings improve
meaningfully, which is not expected.  In addition, the company
could violate its credit agreements if it long delayed its first
quarter 10-Q report.  Although Visteon had large cash balances
totaling $809 million at the end of the first quarter that could
be used to meet its obligations, a large portion of the cash is
overseas and cannot be repatriated quickly without substantial tax
penalties.


VIVENTIA BIOTECH: Equity Deficit Widens to C$26.54M as of Mar. 31
-----------------------------------------------------------------
Viventia Biotech Inc. (TSX:VBI) reported financial and operational
results for the first quarter ended March 31, 2005.

Highlights:

    -- Reported positive preliminary safety and efficacy results
       from a second Phase I trial for Proxinium(TM) in head &
       neck cancer.  Proxinium(TM) achieved a 25% complete
       response rate in this highly refractory cancer.

    -- Obtained U.S. Orphan Drug Designation for Proxinium(TM) in
       head & neck cancer.

    -- Continued to enrol patients in an expanded Phase I trial
       for Proxinium(TM) for the treatment of recurrent bladder
       cancer.

    -- Announced intention to seek a U.S. listing for Viventia's
       common shares.

"Proxinium(TM) has produced very encouraging efficacy results to
date, including a demonstrable survival benefit in patients with
refractory head & neck cancer," said Dr. Nick Glover, President
and CEO of Viventia.  "We look forward to disclosing further
results for our lead drug at ASCO in May and our preparations are
on track to initiate advanced clinical trials for Proxinium(TM) in
2005."

                        Financial Results

For the first quarter ended March 31, 2005, Viventia reported
total expenditures of $5.4 million compared to $3.4 million for
the first quarter of the previous year.

Total research, development and operating expenditures for the
first quarter of 2005 increased by $1.1 million or 41.3% to
$3.9 million, compared to expenditures of $2.8 million for the
first quarter of 2004.  Research related activities increased
to $1.8 million for the first quarter of 2005 compared to
$1.3 million for the corresponding period last year, primarily due
to the commencement of human clinical trials for Proxinium(TM).
Salaries and benefits were $1.5 million for the first quarter of
2005 compared to $1.1 million for the first quarter of 2004, the
increase is primarily attributable to increased personnel levels.

Occupancy costs associated with the leasing of space at the
Company's Winnipeg manufacturing facility were $240,000 for the
first quarter of 2005 compared to $207,000 for the first quarter
of 2004. Other operating costs amounted to $388,000 for the first
quarter of 2005 compared to $144,000 for the first quarter of
2004, this increase being primarily related to increased travel
costs to monitor clinical trials and increased operating costs
related to higher production and manufacturing activities for
processing higher volumes of product for clinical and research
purposes.

General and administrative expenditures increased to $858,000 for
the first quarter of 2005 compared to $335,000 for the first
quarter of 2004, primarily attributable to additional professional
costs due to regulatory requirements in connection with the
Company's intention to seek a U.S. listing as well as costs
associated with increased staff levels.  Interest expense
increased to $287,000 for the first quarter of 2005 compared to
$137,000 for the first quarter of 2004, primarily attributable to
interest amounts on convertible debt.  Stock based compensation
amounted to $162,000 for the first quarter of 2005 compared to
$13,000 for the first quarter of 2004 as a result of the granting
of options in August 2004 and March 2005.

As at March 31, 2005, the Company had cash and short-term deposits
totaling approximately $2.0 million and current liabilities of
$9.4 million compared to $2.7 million and $3.8 million
respectively at December 31, 2004.

Since January 1, 2000, Viventia has financed substantially all of
its operations through:

   (1) the sale of equity securities;

   (2) bridge loan financings from the Company's principal
       shareholder, Mr. Leslie Dan, or entities affiliated with
       Mr. Dan; and

   (3) the issuance of secured convertible debentures to the Dan
       Group.

Although Viventia actively continues to seek additional sources of
funding to finance its operations into the future, the Company can
not provide assurances that additional financing sources will be
available.  If adequate funds are not available from additional
sources, the Company will be required to seek continued funding
for its operations from Mr. Dan or entities affiliated with Mr.
Dan.

During the three months ended March 31, 2005, the Company received
three bridge financing loans from Mr. Dan in the amounts of
$500,000, $1,500,000 and $2,600,000.  Subsequent to the end of the
quarter, on April 28, 2005, the Company received a bridge loan
from Mr. Dan in the amount of $1,500,000.  These loans bear
interest at 4.5% per annum and are repayable on demand.

Viventia Biotech, Inc. (TSX: VBI), is a publicly traded
biopharmaceutical company developing Armed Antibodies(TM),
powerful and precise anti-cancer drugs designed to overcome
various forms of cancer.  Viventia's lead product candidate is
Proxinium(TM), which combines a cytotoxic protein payload
significantly more powerful than traditional chemotherapies with
the highly precise tumor-targeting characteristics of a monoclonal
antibody.  Proxinium(TM) is in clinical development for the
treatment of head and neck cancer and bladder cancer, and is
expected to enter advanced clinical trials in 2005.

As of March 31, 2005, Viventia Biotech's equity deficit widens to
$26,539,000 from a CDN$21,255,000 deficit at Dec. 31, 2004.


W.R. GRACE: Saving Millions as Court Approves IRS Settlement
------------------------------------------------------------
The U.S. Bankruptcy Court for the District of Delaware approved a
settlement agreement between W.R. Grace & Co. and its
debtor-affiliates and the Internal Revenue Service, saving the
Debtors between $3.68 million and $6.25 million annually from
taxes and charges.  The Agreement resolved all IRS audit issues
for the 1993-1996 Tax Audit except for a single issue with respect
to which the Debtors have filed a protest requesting IRS
administrative review.

                           The Dispute

As reported in the Troubled Company Reporter on March 11, 2004,
since 1997, the Internal Revenue Service has been conducting an
examination of the consolidated federal tax returns that included
W. R. Grace & Co and its debtor-affiliates for the 1993-1996 tax
periods.  Pursuant first to pre-bankruptcy tax sharing agreements,
and more recently pursuant to a Court order implementing the
settlement of the Fresenius Medical Care Holdings, Inc.,
fraudulent conveyance litigation, the Debtors have had sole
authority to act for the consolidated groups of taxpayers with
respect to the IRS examination as well as comparable state taxes.

Laura Davis Jones, Esq., at Pachulski, Stang, Ziehl, Young, Jones
& Weintraub, P.C., in Wilmington, Delaware, related that under
the Fresenius Agreement, the Debtors are obligated to pay
indemnified taxes as those taxes become due and payable.
Similarly, under the Fresenius Agreement Order, to the extent
they have agreed to settle any tax liability for the 1993-1996
tax periods, the Debtors are authorized to pay any taxes promptly
and in full.

The Debtors and the IRS concluded the examination of the
1993-1996 tax periods.  The Debtors have determined that it is in
the best interests of their estates and their creditors to settle
numerous issues that are part of the examination.

Because they are required to pay the related taxes when due, and
because they can avoid incurring additional obligations if they
pay those taxes, the Debtors sought and obtained the authority of
the U.S.Bankruptcy Court for the District of Delaware to enter
into a settlement agreement with the IRS with respect to those
issues relating to their taxable years ending December 31, 1993,
through December 31, 1996.

Furthermore, the Debtors sought and obtained permission to pay the
IRS to applicable state tax authorities no later than six months
after they have received revised revenue agent reports from the
IRS:

   (i) all indemnified taxes owing under the 1993-1996 Settlement
       Agreement; and

  (ii) all indemnified taxes relating to state adjustments
       reflecting the resolution of the federal audit for the
       January 1, 1990, through December 31, 1992.

             Corporate-Owned Life Insurance Policies

On January 10, 2005, the Debtors received the Corrected Revenue
Agent's Reports from the IRS for their taxable years ending
December 31, 1993, through December 31, 1996.  The most
significant contested issue in the CRARs concerns Corporate-Owned
Life Insurance Policies.  Specifically, COLI represents
approximately $31 million of the approximately $73 million of
estimated Federal taxes plus interest payable for the 1993-1996
tax period and approximately $8.5 million out of the
approximately $18.5 million of the estimated state taxes payable
for the 1990-1996 tax periods.

On October 13, 2004, the Court authorized the Debtors to enter
into a settlement agreement with the IRS in connection with the
interest deductions claimed with respect to COLI policies and to
pay any related taxes when due in accordance with the Fresenius
Agreement.  Accordingly, on January 20, 2005, the Debtors,
Fresenius Medical Care, Sealed Air Corporation and the IRS
entered into a COLI Closing Agreement in final determination
consistent with the COLI Settlement.  The Debtors believe that
the COLI Closing Agreement is a favorable resolution of a complex
tax issue.

The CRARs were issued prior to the execution of the COLI Closing
Agreement and, therefore, propose 100% disallowance of COLI
related interest deductions.  The COLI Closing Agreement is a
final determination of tax liabilities with respect to the COLI
interest deductions and superceded the CRARs.  The IRS will amend
the CRARs to reflect the terms of the COLI Closing Agreement,
which are incorporated into the Debtors' estimate of 1993-1996
Settlement Agreement Indemnified Taxes.

At present, the IRS has not assessed the Debtors for any taxes
due as a consequence of the COLI Closing Agreement or other
issues that are included in the CRARs.  However, the Debtors ask
the Court to direct them to pay all 1993-1996 Settlement
Agreement Taxes and all 1990-1992 State Indemnified Taxes.

                           Other Issues

The Debtors have come to agreement with the IRS on many issues
raised in the Tax Audit.  As is common in large corporate IRS
audits, the Debtors agreed to numerous proposed tax adjustments
that reflected conformity with agreed IRS adjustments for tax
years prior to the Tax Audit.  The Debtors also agreed to certain
IRS proposed adjustments based on inadvertent errors made by the
Debtors in the preparation of the tax returns subject to the Tax
Audit.  As previously stated, the COLI tax liability constitutes
approximately $31 million of the approximately $73 million in
total estimated Federal taxes due assuming the settlement of all
but one issue relating to the 1993-1996 Federal audit.

The Debtors are in agreement with the remaining $42 million of
proposed tax assessments, which, for the most part, represent:

    (i) Rollover Adjustments from the 1990-1992 taxable years
        totaling approximately $28 million in Federal tax, plus
        interest, and

   (ii) inadvertent errors totaling approximately $12 million in
        tax, plus interest.

Ms. Jones noted that the remaining $2 million in tax, plus
interest, constitutes miscellaneous negotiated issues with
respect to which the Debtors believe they have obtained the best
settlement attainable.

There is one substantive audit issue that the Debtors and the IRS
could not reach an agreement on and with respect to which the
Debtors filed a protest with the IRS on February 9, 2005.  The
matter under contest concerns the IRS' proposed disallowance of
certain research credits and research and experimentation
expenditures claimed by the Debtors on their tax returns for the
1993 through 1996 taxable years representing an amount in
controversy of approximately $7 million in Federal tax plus
interest.  The Debtors previously filed a Protest with respect to
the issue on September 3, 2002.  The 2005 Protest incorporated
the 2002 Protest and constitutes a protest to the proposed
disallowance of these items.  The Debtors have requested that the
matter be referred for review for IRS Appeals and have requested
a conference with the Appeals Office.

With the exception of the matter with respect to the 2005
Protest, the Debtors need the Court's approval to enter into the
1993-1996 Settlement Agreement to settle all Federal tax issues
for the 1993-1996 tax years.

                       1990-1992 State Taxes

The COLI Closing Agreement resolved the only remaining Federal
tax issue in controversy with respect to the Debtors' 1990-1992
Federal tax audit.  With the resolution of the 1990-1992 Federal
tax audit, the Debtors have determined that approximately $13
million of state taxes and interest due constitute Indemnified
Taxes.  Thus, the Debtors seek the Court's approval to pay the
approximately $13 million in 1990-1992 State Indemnified Taxes.

     Direction to Pay the 1993-1996 Settlement Agreement Taxes

A. Fresenius and Sealed Air Several Liability

Treasury regulations permit the IRS to seek payment of Federal
income tax and interest owed by a consolidated group from any
entity that joined in the filing of a consolidated return for the
taxable year at issue.  Accordingly, Ms. Jones notes, the IRS may
seek payment of a substantial portion of those taxes from
Fresenius and Sealed Air which are currently unrelated entities,
but were members of the Debtors' consolidated group for Federal
income tax purposes during the taxable years at issue.

Fresenius was a member for the 1993 taxable year through
September 28, 1996.  Sealed Air was a member for the 1993 taxable
year through December 31, 1996.

As a result of a corporate reorganization, the Debtors and
Fresenius entered into a Tax Sharing and Indemnification
Agreement on September 27, 1996, pursuant to which, among other
things, the Debtors are obligated to indemnify Fresenius for
certain Debtor-related Federal and state tax claims relating to
the tax years ending on or before September 28, 1996.

B. Fresenius Agreement and Indemnified Taxes

On February 6, 2003, the Debtors entered into a Settlement
Agreement and Release of Claims.  For the most part, the
Fresenius Agreement supercedes the Tax Sharing Agreement.

Under the Fresenius Agreement and subject to certain
preconditions, Fresenius agreed to pay, within five business days
after the Settlement Effective Date, $115 million as directed by
the Court for the benefit of the Debtors' Estates.  The
Settlement Effective Date is the later of the effective date of
the Debtors' plan of reorganization, or the satisfaction or
waiver of all preconditions to the Fresenius Payment.  One
precondition to the Fresenius Payment is that the Fresenius Group
be released from all Grace-related Claims, including all
Indemnified Taxes.  "Indemnified Taxes" include all taxes of the
Debtors with respect to any tax period ending on or before
December 31, 1996.

All of the Federal and state taxes owing pursuant to the 1993-
1996 Settlement Agreement qualify as Indemnified Taxes under the
Fresenius Agreement.  Because the taxes owing under the 1993-1996
Settlement Agreement include taxes relating to the carry-back of
certain tax attributes arising in the short period beginning
September 29, 1996, through December 31, 1996, and carried back
to the 1993 through September 28, 1996, taxable periods, the
taxes attributable to the 1996 Short Year are also 1993-1996
Settlement Agreement Indemnified Taxes.  In addition,
approximately $13 million of estimated state taxes for the 1990-
1992 tax period would be included in Indemnified Taxes.

The Fresenius Agreement gives W.R. Grace & Co..-Conn. the sole
authority to act with respect to Indemnified Taxes.  However,
under the Fresenius Agreement, none of the Debtors may
voluntarily agree to the payment, assessment or other resolution
of any Indemnified Taxes prior to the Settlement Effective Date,
unless (a) the Debtors have obtained the Court's authority to pay
in full any Indemnified Taxes pursuant to a final determination
or (b) Fresenius has consented in writing to that agreement by
the Debtors.  Furthermore, pursuant to the order by then District
Court Judge Alfred Wolin approving the Fresenius Agreement, the
Debtors are authorized to make any payment of Indemnified Taxes
in connection with any settlement of taxes.

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, P.C., represent the
Debtors in their restructuring efforts.  (W.R. Grace Bankruptcy
News, Issue No. 83; Bankruptcy Creditors' Service, Inc., 215/945-
7000)


WESTERN OIL: Gets Shareholders' Nod on 3 for 1 Share Split
----------------------------------------------------------
Western Oil Sands Inc. received shareholder approval for a
three-for-one division, or share split, of its issued and
outstanding Class A Common Shares at its Annual and Special
Meeting of shareholders.

The share split will apply to all shareholders of record as of
June 1, 2005.  Western's shareholders will receive two additional
Common Shares for each Common Share held on that date.  The
Company expects to mail the additional share certificates
resulting from the share split on or about June 6, 2005 (Mailing
Date) to shareholders of record as of the close of business on
June 1, 2005 (Record Date).

Subject to approval of the TSX, it is expected that Western's
Common Shares will commence trading on a post-split basis on May
30, 2005.  Following the split, Western will have approximately
160 million Common Shares outstanding.  Western's Common Shares
trade on the Toronto Stock Exchange under the symbol "WTO".

Western is a Canadian oil sands corporation, which holds a 20
percent undivided interest in the Athabasca Oil Sands Project
together with Shell Canada Limited (60 per cent) and Chevron
Canada Limited (20 per cent).

                         *     *     *

As reported in the Troubled Company Reporter on Apr. 10, 2002,
Standard & Poor's Ratings Services affirmed Calgary, Alta.- based
Western Oil Sands Inc.'s 'BB+' corporate credit rating.


WESTERN OIL: Names David Boone & Jim Houck to Board of Directors
----------------------------------------------------------------
Western Oil Sands Inc. reported the appointment of two new members
to its Board of Directors.

Mr. David Boone has been CEO of Escavar Energy since 2003 and is
currently on the Board of Viking Energy Royalty Trust.  Prior to
that, he was President of EnCana's Offshore & International
Operations and Executive Vice President and Chief Operating
Officer of one of EnCana's predecessors, PanCanadian Petroleum.
He spent the early part of his career with ExxonMobil and Imperial
Oil.  Mr. Boone has a B.Eng. degree in Civil Engineering from
Queens University.

At its Annual General and Special Meeting held on May 11, Mr.
James Houck, Western's President and Chief Executive Officer was
also appointed to the Company's Board of Directors.

Mr. Guy Turcotte, Chairman of Western Oil Sands' Board of
Directors noted, "We are very pleased to have David Boone and Jim
Houck join Western's Board.  Both provide a breath of experience
in the oil and gas industry, and they will contribute
significantly to Western as the Company undertakes to aggressively
expand production from its existing oil sands assets."

Western also reported the promotion of two members of its senior
management team.  Mr. Steve Reynish, currently a Western executive
seconded to Albian Sands Energy as Chief Operating Officer, will
relocate to Calgary to become Senior Vice President Operations of
Western, and Mr. David Dyck, currently Vice President Finance &
CFO of the Company, will become Senior Vice President Finance and
Chief Financial Officer.

Mr. Steve Reynish has been responsible for the start-up and
successful ramping up to full production of Albian Sands Energy,
the bitumen mining and extraction entity of the Athabasca Oil
Sands Project.  Before joining Western, Mr. Reynish held senior
positions within the Anglo American Group, including Vice
President - Mining of Anglo Base Metals in Johannesburg and CEO of
Bindura Nickel in Zimbabwe.  Mr. Reynish holds a Masters degree in
Mining Engineering and an MBA, both earned in the UK.

Mr. David Dyck has been a vice president of Western since he
joined the company in 2000.  Mr. Dyck has been responsible for
virtually all of the equity and debt financings the Company has
undertaken during that time.  He holds a Bachelor of Commerce
degree from the University of Saskatchewan.  He is a chartered
accountant and a member of the Alberta and Canadian Institutes of
Chartered Accountants.  Mr. Dyck's appointment is effective
immediately and Mr. Reynish's appointment is effective September
15 when he relocates to Calgary.

Jim Houck, President and CEO of Western, stated that "We are
pleased to recognize the major contributions Steve Reynish and
David Dyck have made to Western in the past several years. They
will be key players as Western grows its existing and new
businesses."

Western is a Canadian oil sands corporation, which holds a 20
percent undivided interest in the Athabasca Oil Sands Project
together with Shell Canada Limited (60 per cent) and Chevron
Canada Limited (20 per cent).

                         *     *     *

As reported in the Troubled Company Reporter on Apr. 10, 2002,
Standard & Poor's Ratings Services affirmed Calgary, Alta.- based
Western Oil Sands Inc.'s 'BB+' corporate credit rating.


WESTPOINT STEVENS: Wants to Sell Rosemary Property to Spealman
--------------------------------------------------------------
Prior to the Petition Date, WestPoint Stevens, Inc. and its
debtor-affiliates owned and operated a vertical towel
manufacturing facility which included a weaving mill, a finishing
complex, a sewing operation, and a distribution center located in
a 960,000 square-foot multi-building manufacturing complex in
Roanoke Rapids, North Carolina -- Rosemary Property.

The Debtors ceased operations at the Rosemary Property in June
2003.  Thereafter, the Debtors utilized the property for
warehousing, storage, and related use.

According to John J. Rapisardi, Esq., at Weil, Gotshal & Manges,
LLP, in New York, the Debtors have determined that the property is
no longer needed for warehousing and storage.  To avoid the
accrual of any further maintenance and ownership costs, the
Debtors decided to sell the Rosemary Property.  To help market the
Rosemary Property to prospective purchasers, the Debtors employed
Corporate Properties LLC as their exclusive real estate broker.

                        Marketing Efforts

CPL undertook an intensive, five-month marketing campaign to sell
the Rosemary Property.  CPL's marketing efforts were complicated
due to the depressed state of the local real estate market and
rural location of the Rosemary Property, which is approximately 86
miles from the nearest city center.  Moreover, due to the
significant size of the Plant and the Debtors' unique use of the
Rosemary Property, CPL encountered great difficulty in locating a
prospective purchaser interested in acquiring the Rosemary
Property as a whole, especially in light of the weak market for a
former textile manufacturing facility.

CPL received modest interest and three informal proposals for the
Rosemary Property.  CPL talked to each potential purchaser and
analyzed the potential risks associated with closing a transaction
with each entity.  Mr. Rapisardi relates that of the three
informal offers received, Stan Spealman ETUX's offer:

   -- had the least amount of closing conditions;

   -- was extremely competitive on "economics"; and

   -- demonstrated the highest probability of closing in the
      immediate future.

Accordingly, CPL advised the Debtors that Stan Spealman ETUX
represented the most attractive purchaser of the Property.

                           Sale Agreement

After extensive, arm's-length negotiations, the parties reached an
agreement, pursuant to which the Purchaser agreed to pay the
Debtors $1,800,000 for the Property.  As deposit, the Purchaser
has paid the Debtors $25,000.  The balance of the purchase price
will be paid at the sale closing.

Pursuant to the Sale Agreement, the Debtors will convey the
Property to the Purchaser free of liens and encumbrances except
for all easements, rights-of-way, and existing access to adjacent
properties as may be a matter of public record or as may be
evidenced by possession, use or survey.

The Debtors believe that a public auction is unnecessary and would
only entail delay and attendant expense with no likelihood of
benefit to their estates.

By this motion, the Debtors ask the Court to approve the sale of
the Rosemary Property to Stan Spealman ETUX in accordance with the
Sale Agreement.

Pursuant to the Sale Agreement, the Debtors are obligated to pay a
brokerage fee to CPL equal to six percent of the gross sales
price.  The Debtors seek the Court's authority to pay the
brokerage fee to CPL upon sale closing.

Headquartered in West Point, Georgia, WestPoint Stevens, Inc., --
http://www.westpointstevens.com/-- is the #1 US maker of bed
linens and bath towels and also makes comforters, blankets,
pillows, table covers, and window trimmings.  It makes the Martex,
Utica, Stevens, Lady Pepperell, Grand Patrician, and Vellux
brands, as well as the Martha Stewart bed and bath lines; other
licensed brands include Ralph Lauren, Disney, and Joe Boxer.
Department stores, mass retailers, and bed and bath stores are its
main customers.  (Federated, J.C. Penney, Kmart, Sears, and Target
account for more than half of sales.) It also has nearly 60 outlet
stores.  Chairman and CEO Holcombe Green controls 8% of WestPoint
Stevens.  The Company filed for chapter 11 protection on
June 1, 2003 (Bankr. S.D.N.Y. Case No. 03-13532).  John J.
Rapisardi, Esq., at Weil, Gotshal & Manges, LLP, represents the
Debtors in their restructuring efforts. (WestPoint Bankruptcy
News, Issue No. 45; Bankruptcy Creditors' Service, Inc.,
215/945-7000)


WINFRED CHRISTIAN: Case Summary & 20 Largest Unsecured Creditors
----------------------------------------------------------------
Debtor: Winfred Ellis Christian, Jr. & Sheila Kay Christian
        6 Colonial Winstead
        Brentwood, Tennessee 37027

Bankruptcy Case No.: 05-05734

Type of Business: The Debtors previously filed for chapter 11
                  protection on August 2, 2004 (Bankr. M.D. Tenn.
                  Case No. 04-09311).

Chapter 11 Petition Date: May 11, 2005

Court: Middle District of Tennessee (Nashville)

Judge: Keith M. Lundin

Debtor's Counsel: Steven L. Lefkovitz, Esq.
                  Law Offices Lefkovitz & Lefkovitz
                  618 Church Street, Suite 410
                  Nashville, Tennessee 37219
                  Tel: (615) 256-8300
                  Fax: (615) 250-4926

Total Assets: $1,737,000

Total Debts:  $1,363,975

Debtor's 20 Largest Unsecured Creditors:

   Entity                     Nature of Claim       Claim Amount
   ------                     ---------------       ------------
Mercedes Benz Credit          2003 Mercedes S430         $52,000
P.O. Box 685                  Value of security:
Roanoke, TX 76262             $37,000

Sweeney, Vivian Fay                                      $38,000
1212 Guadelupe Court
Westminster, MD 21157

Williamson Medical Center                                 $9,083
P.O. Box 681600
Franklin, TN 37068

Governors Club                                            $7,865
9681 Concord Road
Brentwood, TN 37027

GC Landscaping                                            $6,952
9681 Concord Road
Brentwood, TN 37027

Governors Club POA                                        $5,046
9681 Concord Road
Brentwood, TN 37027

Household Credit Svcs M/C                                 $2,531
P.O. Box 5222
Carol Stream, IL 601975222

Capital One Visa                                          $2,460
P.O. BOX 85147
Richmond, VA 23285

Capital One Visa                                          $2,194
P.O. BOX 85147
Richmond, VA 23285

Orchard Bank M/C                                          $1,546
Bankcard Svcs
P.O. Box 5222
Carol Stream, IL 60197

Bone and Joint Clinic                                     $1,255
C/O Prof ADJ Service
450 10th Avenue North
Nashville, TN 37202

Fleet Visa                                                $1,219
Fleet Credit Card Svc
P.O. BOX 15368
Wilmington, DE 198865368

Cool Springs Imaging                                      $1,178
1608 Westgate Circle, Suite 200
Brentwood, TN 37027

Capital One Mastercard                                    $1,113
P.O. BOX 85147
Richmond, VA 23276

Capital One Visa                                          $1,045
P.O. BOX 85147
Richmond, VA 23285

Nashville Gas                                               $887
665 Mainstream Drive
Nashville, TN 37228

Capital One Visa                                            $705
P.O. BOX 85147
Richmond, VA 23285

Williamson Medical Center                                   $698
P.O. Box 681600
Franklin, TN 37068

Cool Springs Imaging                                        $542
1608 Westgate Circle, Suite 200
Brentwood, TN 37027

Saint Thomas Hospital                                       $326
P.O. Box 501052
Saint Louis, MO 63150


YUKOS OIL: Yugansk Lawsuits Against Yukos Set for Hearing in May
----------------------------------------------------------------
The Moscow Court of Arbitration has delayed until May 13
consideration of merits of the Yuganskneftegaz lawsuit for
collection of 62.3 billion rubles from Yukos for oil deliveries.

Yuganskneftegaz supplied the oil to Yukos for selling in July
through December 2004.

Yuganskneftegaz filed two other lawsuits against Yukos, including
the one to collect RUR141 billion in taxes and the other to
collect RUR163 billion in compensation of the lost profit in oil
selling to Yukos.

Preliminary hearings on the first lawsuit will go on May 10, and
the other lawsuit will be considered on May 24.

Headquartered in Houston, Texas, Yukos Oil Company is an open
joint stock company existing under the laws of the Russian
Federation.  Yukos is involved in the energy industry
substantially through its ownership of its various subsidiaries,
which own or are otherwise entitled to enjoy certain rights to oil
and gas production, refining and marketing assets.  The Company
filed for chapter 11 protection on Dec. 14, 2004 (Bankr. S.D. Tex.
Case No. 04-47742).  Zack A. Clement, Esq., C. Mark Baker, Esq.,
Evelyn H. Biery, Esq., John A. Barrett, Esq., Johnathan C. Bolton,
Esq., R. Andrew Black, Esq., Fulbright & Jaworski, LLP, represent
the Debtor in its restructuring efforts.  When the Debtor filed
for protection from its creditors, it listed $12,276,000,000 in
total assets and $30,790,000,000 in total debts.  (Yukos
Bankruptcy News, Issue No. 20; Bankruptcy Creditors' Service,
Inc., 215/945-7000)


* Moody's Places Stable Credit Outlook For U.S. REITs
-----------------------------------------------------
The rating outlook for US REITs and REOCs remains stable for 2005
and into 2006 as the performance of most types of commercial real
estate continue to improve, says Moody's Investors Service in a
new report.  The rating agency expects US Real Estate Investment
Trusts and Real Estate Operating Companies to sustain their
moderate leverage, stable-to-improving interest coverage and sound
liquidity, but warns that some companies could face challenges if
the frothy real estate investment and capital markets were to
experience a correction.

"The top questions facing the industry are whether commercial real
estate has peaked as regards to cap rates, and whether REIT stock
prices and debt finance terms turn more hostile," says Philip M.
Kibel CPA, a Senior Vice President with Moody's and the report's
main author.  Strategic shifts at many REITs to boost their
exposure to such structures as real estate funds are another
potential creditworthiness concern.

Moody's believes the credit ratings of most REITs are unlikely to
change in the near term, their increasingly healthy performance,
and potential adverse shifts in their business models or balance
sheets notwithstanding.

             Sector Performed Well During Downturn

US real estate investment trusts (REITs) and real estate operating
companies (REOCs) did well on the whole during the US economic
downturn, helped by low and falling interest rates, and by
strengthening cap rates on property sales.  In addition, the
robust performance of most REIT stocks and welcoming capital
markets helped many REITs turn in surprisingly good performances
during the stressed 2001-2004 period.

According to Moody's, much of the credit for this performance goes
to the REITs themselves, which moved swiftly to refocus their
growth strategies, sell non-core and underperforming assets, and
reduce their development pipelines once they realized a recession
was underway in 2001.  The moderate leverage and healthy levels of
unencumbered assets that earmark many REITs were also of help.

"The prudence of most REIT managers in the face of considerable
business pressure allowed REITs to retain relatively strong credit
metrics during the downturn, in marked contrast to previous
recessions," said Mr. Kibel.

Leverage has remained stable, with total debt to gross assets at
approximately 44% at the end of 2004.  REITs' fixed charge
coverage, defined as recurring EBITDA over interest expense and
preferred dividends, has also stayed relatively constant at 2.5x.
REITs have also retained strong liquidity positions and well-
laddered debt maturities.

                    New Structures, New Risks

Despite these positive characteristics, the growing reliance of
many firms on growth generated through joint ventures, real estate
fund structures, international investments, and merchant building
and development businesses has Moody's concerned.

"The ultimate effects of these structures on REITs' transparency,
strategic complexity, true leverage, liquidity and earnings
stability can be negative," said John J. Kriz, managing director
of Moody's Real Estate Finance team.  "Firms that have increased
their earnings by way of strategies such as real estate funds and
joint ventures may find the costs outweighing the benefits."

                    Individual Sector Outlooks

Moody's outlook for all rated REIT sectors is stable, though the
factors underlying this stability vary by sector.

The stable outlook for US office REITs is supported by declining
vacancies, rising employment, and a limited supply of new space.
Moody's believes most office REITs have managed their balance
sheets prudently and does not expect this to change.

The stable outlook for industrial REITs is predicated upon
expectation of moderate leverage, a large supply of unencumbered
assets, and firming rental rates and occupancy, supported by an
improving economy, which has led to a rise in industrial space
needs.

The multifamily REIT sector's stable outlook reflects improving
cash flows and waning tenant concessions following several years
in which the sector's fundamentals were adversely affected by soft
employment figures and a tenant drift to home ownership.  Moody's
expects most multifamily REITs to push harder for higher rents in
2005 and 2006.

Moody's stable outlook for retail REITs is based on sound balance
sheets, subsector leadership by REITs in regional malls, and
continued consumer spending which has supported retail property
values and rents.  Retails properties performed particularly well
in the recession.  Rising interest rates and energy prices could
challenge the sector later in 2005, however, if they constrain
consumers' spending power.  Higher operating expenses and a rise
in leveraged consolidation among retailers and REITs could also
cause rating downgrade pressures.

For healthcare REITs, higher government reimbursements and the
shedding of excess property supply support a stable rating
outlook.  For lodging REITs, the return of business travelers and
a shift towards the more profitable corporate and meeting segments
have led stronger daily rates and revenues per available room, and
to a stable rating outlook.


* AlixPartners Names Emanuele Pedrotti as Director
--------------------------------------------------
AlixPartners, the international corporate turnaround, performance
improvement, and financial advisory firm, announced the
appointment of Emanuele Pedrotti as a Director.  He is an expert
in the fashion and consumer goods industries, having acquired
extensive experience both as a consultant and industry executive.
While he will be based in Milan, Pedrotti will work on engagements
worldwide.

Pedrotti's industry experience includes three major line
management positions with Dolce & Gabbana, Cerruti, and Donna
Karan.  He served as a Division Manager of Dolce & Gabbana
Industria, where he was significantly involved both on the supply
and market side.  Later, he held a position with Cerruti as
General Manager with Hitman, the research, development and
production branch of the Cerruti group.  His most recent position,
as Senior Vice President at Donna Karan in New York, solidified a
proven track record in the industry that includes both
restructuring existing activities and opening new offices and
facilities.

Prior to his industry work, he was a consultant for 12 years, most
recently serving as a Principal with A.T. Kearney in Milan, where
he focused on strategy and operations projects for clients in the
fashion, retail, foodservice, food manufacturing, consumer goods
and pharmaceutical industries across Europe.

Pedrotti graduated with a degree in electronic engineering and
specialized in software development processes at Politecnico
University in Milan.  He has worked throughout Europe in France,
Germany, and Italy, as well as in the USA.

AlixPartners (www.alixpartners.com) is internationally recognized
for its hands-on, results-oriented approach to solving operational
and financial challenges for large and middle market companies
globally.  Since 1981, the firm has become the "industry standard"
for performance improvement aimed at producing bottom-line results
quickly and helping clients achieve a more positive outcome during
times of transition.  The firm has over 350 professionals in its
Chicago, Dallas, Detroit, Dusseldorf, London, Los Angeles, Milan,
Munich, New York, and Tokyo office.


* BOOK REVIEW: Getting It to the Bottom Line
--------------------------------------------
Author:     Richard S. Sloma
Publisher:  Beard Books
Softcover:  196 pages
List Price: $34.95

Order your personal copy at:
http://www.amazon.com/exec/obidos/ASIN/189312259X/internetbankrupt

In the author's words, "(t)his is a book about how to optimize
operating profit in an ongoing business consistent with and
supportive of the owners' (and/or creditors') demands."  As in his
book "The Turnaround Manager's Handbook," also published by Beard
Books, Richard Sloma's guidance is all-inclusive, straightforward,
and wise.  He is perhaps unique in his ability to use quotes and
maxims liberally without sounding the least bit preachy or trite.

A quote from Francois Voltaire, "perfection is attained by small
degrees," explains the main premise of this book, management by
incremental gains.  It is based on the simple notion that change,
for better or worse and accidentally or on purpose, only occurs
incrementally.  Without a succession of small changes in the same
direction, there can be no progress or growth.  Mr. Sloma defines
management as "getting work done through the efforts of others."
Thus, change in an organization depends on people.  Mr. Sloma
takes a pragmatic (and perhaps somewhat dim!) view of the ability
of people to changes, and maintains that the smaller a change
planned by management, the more likely it is to be successfully
implemented.

Mr. Sloma provides "real-world tested and proven methodology for
working with people in a professional manner to maximize their
individual commitment to goal achievement."  He offers
recommendations based on his more than 30 years of management
experience that "strike(s) the long-sought-after logical balance
of viewing and managing people as if they were competent,
conscientious, and ambitious individuals who genuinely seek
opportunities for professional growth and development."

"Getting It To The Bottom Line" is not only about people skills.
Mr. Sloma introduces financial and operational performance
numbers, and gives details on how income statements and cash flow
statements measure the magnitude and direction of planned changes
in financial operational performance.  His operational framework
is illustrated in the following eight steps: Quantify the do-
nothing scenario; If it works, don't fix it; If it doesn't,
quantify minimal acceptable performance levels; Quantify
components of any financial performance gap; If necessary, cut
your losses, liquidate and reinvest elsewhere; Quantify management
action plans to bridge the performance gap; Define and establish a
reporting and control system; Define and implement an incentive
compensation program.

Mr. Sloma examines each step thoroughly, using recognized
financial analysis methods, as well as some of his own.
Throughout, he consistently emphasizes the importance of achieving
ambitious goals one small step at a time.  He admonishes managers
to "spend no time or effort making 'little" plans.  They have no
magic to stir men's blood - or to make owners as wealthy as they
could be!"

This is a solid and substantive book that targets managers at
every level.  Mr. Sloma presents his concepts in such a way that
anyone charged with leading an organization can learn to do it
better

Richard s. Sloma is an attorney with more than 30 years of senior
management experience.  He has served as Chief Executive Officer,
Chief Operating Officer, Chairman and Vice Chairman of the Board
of Directors, and Board Member of six international companies.  He
holds degrees in business from Northwestern University and the
University of Chicago, and a law degree from De Paul University.


                          *********

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

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

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

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

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

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

                          *********

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

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