TCR_Public/050722.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, July 22, 2005, Vol. 9, No. 172

                          Headlines

ABLE LABORATORIES: Hires Lowenstein Sandler as Local Counsel
ABLE LABORATORIES: Wants to Hire Cottone & Shepperd as CEO & CFO
AIR CANADA: Investment Mgr. Fined C$120K for Wash Trading Scheme
AMERICAN RESTAURANT: Completes Debt-for-Equity Swap
AMHERST TECHNOLOGIES: Case Summary & 20 Largest Creditors

AMPHENOL CORP: Earns $52 Million of Net Income in Second Quarter
ARTHUR TRACE: Case Summary & 5 Largest Unsecured Creditors
ATA AIRLINES: Chicago Express Inks $470K Settlement Pact with Saab
ATA AIRLINES: Court Approves BCC Equipment Amendment Settlement
ATRIUM COS: Default Notice on Sr. Notes Prompt S&P to Junk Ratings

BANCO INTERACCIONES: Moody's Rates Currency Deposits at Ba3
BAYOU STEEL: Moody's Rates Proposed $50 Million Term Loan B at B3
BDR CORP: Hires Joseph Delay as Expert to Attack BofA's Claim
BEARINGPOINT INC: Secures Five-Year $150 Million Syndicated Loan
BEARINGPOINT INC: Audit Committee Continues Oversight Review

BEARINGPOINT INC: Expects to File Tardy Financials by September
BEAR STEARNS: S&P Lowers Rating on Class B Certificates to D
BE SMART: Case Summary & 20 Largest Unsecured Creditors
BLUE DOLPHIN: Scrapes Up $600,000 Working Capital for 2005
BREED TECHNOLOGIES: Jones Day Lawyer Accused of Actual Conflict

CAN-CAL RESOURCES: Losses Trigger Going Concern Doubt
CAN-CAL RESOURCES: Scraps Pinos Project With Minera Apolo
CAROLINA TOBACCO: Wants Until Sept. 19 to Decide on Leases
CENVEO INC: Proxy Filing Prompts S&P to Retain Developing Watch
COLLINS & AIKMAN: Committee Wants to Reject Unprofitable Contracts

COLLINS & AIKMAN: Mexican Unit Inks Waiver Agreement for Facility
COLLINS & AIKMAN: Visteon Wants to Set Off Prepetition Debt
COTT CORPORATION: Reports Second Quarter Operating Results
D&G INVESTMENTS: Case Summary & 2 Largest Unsecured Creditors
D & K STORES: Lucky Dollar Buys Inventory for $4,500 per Truckload

DELTA AIR: Appoints Bastian as CFO After Palumbo's Resignation
DELTA AIR: Discloses Executive Changes to Realign Leadership
DICKIE WALKER: Amends Acquisition Pact with Intelligent Energy
DICKIE WALKER: Intelligent Energy Secures $14MM Equity Financing
FEDERAL-MOGUL: Asbestos PD Panel's Closing Arguments in Estimation

FEDERAL-MOGUL: Asbestos PI Panel's Closing Arguments in Estimation
FEDERAL-MOGUL: Futures Rep's Closing Arguments in Estimation
FLEETWOOD ENTERPRISES: Operating Losses Prompt S&P to Cut Ratings
FORD MOTOR: Deteriorating Profitability Prompts Fitch's Downgrade
GENERAL BINDING: New Company's Stock Registration Is Effective

GENERAL MOTORS: Posts $286 Million Net Loss in Second Quarter
GENEVA STEEL: Panel Extends Benedetto & BF's Retention to Oct. 4
GEO GROUP: Moody's Affirms B1 Rating on Senior Unsecured Notes
GREAT ATLANTIC: Moody's Reviews Senior Unsec. Notes' Junk Rating
GRUPO DINA: Extends Exchange Offer on 8% Debentures to Aug. 16

HEARTLAND TECH: Creditors Must Submit Proofs of Claim by Sept. 14
HEARTLAND TECH: Plan Confirmation Hearing Scheduled for Aug. 23
HOST MARRIOTT: Earns $91 Million of Net Income in Second Quarter
HUNT HOPPOUGH: Case Summary & 22 Largest Unsecured Creditors
INNOPHOS INC: Favorable Summary Judgment Cues S&P's Stable Outlook

INTEGRATED HEALTH: Briarwood Asks Court to Deny Summary Judgment
INTEGRATED HEALTH: Wants Removal Period Extended to Aug. 5
INT'L PAPER: Moody's Reviews (P)Ba1 Preferred Shelf Rating
INTERPUBLIC GROUP: Names Frank Mergenthaler as New EVP & CFO
IPCS INC: Horizon Merger Prompts S&P to Affirm Junk Ratings

K2 INC: Earns $1.5 Million of Net Income in Second Quarter
KEY ENERGY: Reports June 2005 Rig Hours & Select Financial Data
LATHAM MANUFACTURING: Moody's Affirms B2 Rating on $145 Mil. Debts
LIFECARE HOLDINGS: S&P Junks Proposed $150 Million Senior Notes
MAGNUM HUNTER: Cimarex Offers to Buy Senior & Convertible Notes

MAYTAG CORP: Haier America Withdraws $1.28 Billion Bid
MCI INC: NY PSC Staff's Comments on MCI & Verizon Merger
MEGO FINANCIAL: Chapter 11 Trustee Begins a Fishing Expedition
METALFORMING TECH: Look for Bankruptcy Schedules on Aug. 14
METALFORMING TECH: Committee Taps Mesirow as Financial Advisor

METRIS COS: Earns $32.5 Million of Net Income in Second Quarter
MIRANT CORP: Creditor Panel Taps McKenna Long to Sue Andersen
MIRANT CORP: MAGi Panel's Request to Prosecute Claims Draws Fire
NATIONAL CENTURY: Deloitte Inks $4.8 Mil. Settlement with Arizona
NORTHWEST AIRLINES: Mediation Board Frees Carrier From AMFA Talks

PASADENA GATEWAY: Court Confirms Amended Plan of Reorganization
PASTA GARDEN: Case Summary & 15 Largest Unsecured Creditors
PENINSULA HOLDINGS: Section 341(a) Meeting Continues on Aug. 16
PHOTOWORKS INC: Shareholders Okay 1-for-5 Reverse Stock Split
PRIME CAMPUS: UST & Varde Fund Want Case Converted or Dismissed

PLEASANT VIEW: Voluntary Chapter 11 Case Summary
QUEEN'S SEAPORT: Exclusive Plan Filing Period Intact Until Oct. 14
QUIGLEY COMPANY: Asks Court for Extension to Remove Civil Actions
RASC: Reduced Credit Support Cues S&P to Cut Class M Rating to BB
RHODES INC: Court Okays Store Closing Sales & Agency Agreement

R.J. REYNOLDS: 62% of Noteholders Tender 7-3/4% Notes Due 2006
SAINT VINCENTS: Asks Court to Deem Utilities Adequately Assured
SAINT VINCENTS: Lynn Marziale Wants Court to Lift Automatic Stay
SAINT VINCENTS: US Trustee Appoints 7-Member Creditor's Committee
SAKS INC: Tender Offer Completion Cues S&P to Lift Ratings to B+

SALEM COMMS: Amended Credit Facility Increases Loan to $300 Mil.
SENSIENT TECH: Poor Credit Measures Cue S&P to Cut Ratings to BB+
SHAW COMMUNICATIONS: Earns $43.3 Mil. of Net Income in 3rd Quarter
SHURGARD STORAGE: S&P Lowers Preferred Stock Rating to BB+
SKIN NUVO: Wants Exclusive Plan Filing Period Stretched to Aug. 19

SOUTHWEST RECREATIONAL: Panel Wants to Conduct Rule 2004 Probe
SOVEREIGN BANCORP: Directors Authorize 20 Million Share Buy-Back
STRUCTURED ASSET: Fitch Affirms Low-B Ratings on 12 Cert. Classes
SUNRISE CDO: Fitch Junks $15 Million Class C Notes
THOMAS BABB: Voluntary Chapter 11 Case Summary

UAL CORP: Machinists Ratify Six Amended Labor Contracts
US AIRWAYS: KfW Transfers 5 Claims for $168.7MM to R2 Investments
USG CORP: Opposes Discovery as Parties Present Witness List
WCI STEEL: Gets Court Nod to Enter Into Agreements with Praxair
WHEREHOUSE ENTERTAINMENT: Claim Objection Deadline is Now July 29

WILBAR REALTY: Aqua Pennsylvania Buys Some Assets for $1.6 Million
W.R. GRACE: Reports Second Quarter Operating Results
YES! ENTERTAINMENT: Trustee Wants Entry of Final Decree Delayed

* The Altman Group Completes Transition to Full Service Agency

* BOOK REVIEW: Corporate Recovery: Managing Cos. in Distress

                          *********

ABLE LABORATORIES: Hires Lowenstein Sandler as Local Counsel
------------------------------------------------------------
Able Laboratories, Inc., dba DynaGen, Inc., asks the U.S.
Bankruptcy Court for the District of New Jersey, Trenton Division,
for permission to retain Lowenstein Sandler PC as its local
counsel.

Lowenstein Sandler is an AmLaw 200 law firm with offices in New
Jersey and New York.  The firm represents a wide range of clients
including public and private companies, financial institutions,
investors, entrepreneurs, governmental agencies and universities.

The Debtor has selected Lowenstein Sandler as its local counsel
because of the firm's knowledge of the Debtor's business and
financial affairs and its extensive general experience and
knowledge, and in particular, its recognized expertise in the
field of debtors' protections and creditors' rights and business
reorganizations under chapter 11 of the Bankruptcy Code.

Lowenstein Sandler will:

   (a) advise the Debtor with respect to its powers and duties as
       debtor-in-possession in the continued management of its
       business and properties;

   (b) attend meetings and negotiate with representatives of
       creditors and other parties-in-interest;

   (c) take all necessary action to protect and preserve the
       estate of the Debtor, including the prosecution of actions
       on the Debtor's behalf, the defense of any actions
       commenced against the Debtor, the negotiation of disputes
       in which the Debtor is involved, and the preparation of
       objections to claims filed against the Debtor's estate;

   (d) prepare on behalf of the Debtor, as debtor-in-possession,
       all necessary motions, applications, answers, orders,
       reports, and other papers in connection with the
       administration of the Debtor's estate;

   (e) negotiate and prepare, on the Debtor's behalf, a plan of
       reorganization, disclosure statement, and all related
       agreements and documents, and taking any necessary
       action on behalf of the Debtor to obtain confirmation of
       that plan;

   (f) represent the Debtor in connection with obtaining
       postpetition loans;

   (g) advise the Debtor in connection with any potential sale of
       assets;

   (h) appear before the Bankruptcy Court, any appellate courts,
       and the United States Trustee, and protecting the interests
       of the Debtor's estate before those Courts and the United
       States Trustee;

   (i) consult with the Debtor regarding tax matters; and

   (j) perform all other necessary legal services and providing
       all other necessary legal advice in connection with the
       Debtor's chapter 11 case.

Kenneth A. Rosen, Esq., a member at Lowenstein Sandler, disclosed
that the Firm has received a $100,000 retainer.  The current
hourly rates of professionals who will on the engagement are:

   Designation                           Hourly Rate
   -----------                           -----------
   Partners                              $300 - $575
   Counsel                               $160 - $395
   Legal Assistants                       $75 - $150

The Debtor believes that Lowenstein Sandler PC is disinterested as
that term is defined in Section 101(14) of the U.S. Bankruptcy
Code.

Headquartered in Cranbury, New Jersey, Able Laboratories, Inc.
-- http://www.ablelabs.com/-- develops and manufactures generic
pharmaceutical products in tablet, capsule, liquid and suppository
dosage forms.  Generic drugs are the chemical and therapeutic
equivalents of brand name drugs.  The Company filed for chapter 11
protection on July 18, 2005 (Bankr. N.J. Case No. 05-33129).
Deborah Piazza, Esq., and Mark C. Ellenberg, Esq., at Cadwalader,
Wickersham & Taft LLP represent the Debtor in its restructuring
efforts.  When the Debtor filed for protection from its creditors,
it listed $59.5 million in total assets and $9.5 million in total
debts.


ABLE LABORATORIES: Wants to Hire Cottone & Shepperd as CEO & CFO
----------------------------------------------------------------
Able Laboratories, Inc., dba DynaGen, Inc., asks the U.S.
Bankruptcy Court for the District of New Jersey for permission to
hire:

   -- Paul Cottone as its chief restructuring officer; and
   -- Richard Shepperd as its director of finance.

Deborah Piazza, Esq., at Cadwalader, Wickersham & Taft LLP in New
York tells the Court that Mr. Cottone is an experienced manager in
the generic drug industry.  Mr. Cottone will be an officer of the
Debtor and will assume functions and authority as the Chief
Executive Officer.

Ms. Piazza also tells the Court that Mr. Shepperd is experienced
in accounting, reorganizations under chapter 11, and in the
generic drug industry.  Mr. Shepperd will be an officer of the
Debtor and will assume responsibilities and authority as the Chief
Financial Officer.

Mr. Cottone will receive:

   -- $50,000 per month;
   -- a $1,000 monthly car allowance;
   -- a $2,800 monthly lodging allowance; and
   -- a potential success fee.

Mr. Shepperd will receive $50,000 per month with the potential to
receive a success fee.

The success fee will be awarded by the Board of Directors and will
be subject to the approval of the Bankruptcy Court.

The Debtor believes that Paul Cottone and Richard Shepperd are
disinterested as that term is defined in Section 101(14) of the
U.S. Bankruptcy Code.

Headquartered in Cranbury, New Jersey, Able Laboratories, Inc.
-- http://www.ablelabs.com/-- develops and manufactures generic
pharmaceutical products in tablet, capsule, liquid and suppository
dosage forms.  Generic drugs are the chemical and therapeutic
equivalents of brand name drugs.  The Company filed for chapter 11
protection on July 18, 2005 (Bankr. N.J. Case No. 05-33129).
Deborah Piazza, Esq., and Mark C. Ellenberg, Esq., at Cadwalader,
Wickersham & Taft LLP and Kenneth A. Rosen, Esq. and Sharon L.
Levine, Esq., at Lowenstein Sandler PC represent the Debtor in its
restructuring efforts.  When the Debtor filed for protection from
its creditors, it listed $59.5 million in total assets and $9.5
million in total debts.


AIR CANADA: Investment Mgr. Fined C$120K for Wash Trading Scheme
----------------------------------------------------------------
W. Scott Leckie was fined C$100,000 and must pay Market Regulation
Services Inc. (RS) C$20,000 in costs after an RS Hearing Panel
approved a settlement agreement between Mr. Leckie and RS in which
he admitted to effecting trades in Air Canada stock on seven
occasions between June 13 and 30, 2003 where there was no change
of beneficial or economic ownership.  This is a manipulative and
deceptive method of trading, contrary to Universal Market
Integrity Rule 2.2(2)(b), for which he is liable pursuant to UMIR
10.4(1)(a).

Mr. Leckie is Senior Vice President and a portfolio manager at
Aquilon Capital Corp., which at the time of the wash trading was
known as MMI Group Inc.  The company, a market participant,
changed names on February 1, 2005.

In April 2003, Mr. Leckie sought to implement a short selling
strategy on behalf of a client (Company A) with respect to shares
in Air Canada.  Company A had a trading account with Dealer X,
opened for that purpose by Mr. Leckie on the client's behalf.

Prior to April 3, 2003, Company A's account at Dealer X did not
hold a position in Air Canada.  On April 3, 2003, Mr. Leckie
commenced short selling shares of Air Canada in this account for
Company A.

In the period April 3, 2003 to June 13, 2003, Mr. Leckie continued
to short sell shares of Air Canada for Company A's account.
During this period, Dealer X was unable to borrow Air Canada
shares to cover Company's A short position.  As a result, the
account was continually being bought in by Dealer X, at a premium,
to cover this short position.

In order to preserve the short positions, Mr. Leckie opened
another account for Company A at Dealer Y because he was told by
Dealer Y that he would be able to borrow Air Canada shares to
cover short selling activity.

It turned out that Dealer Y was unable to borrow Air Canada
shares.  As a result, commencing on June 13, 2003, when faced with
a pending buy-in at Dealer X, Mr. Leckie sold short shares of Air
Canada in the Company A's account at Dealer Y and then bought
shares of Air Canada into Company A's account at Dealer X to cover
the short position at Dealer Y.

In addition to the trades of June 13, 2003, trades of a similar
nature occurred on June 17, 19, 20, 24, 26 and 30, 2003.

Although Mr. Leckie knew that the trading activity would not
result in a change of beneficial ownership, the intent of the
trades was to preserve his client's short position in Air Canada
shares.  Mr. Leckie stated that his trading activity was not
carried out with the intent to manipulate the price of Air Canada
shares or to deceive the market.  However, he admitted that while
he spent considerable time reviewing regulatory policy around buy-
in rules, he did not consider the fact that his actions would be a
violation of the "wash trading" rule.

Mr. Leckie's client received no benefit and, in fact, ultimately
lost money on the Air Canada trading.

"Wash trading creates a false impression of trading activity,"
said Maureen Jensen, Vice President, Market Regulation, Eastern
Region at RS.  "It sends a signal that trading is taking place
when in fact no transaction has been executed. While Mr. Leckie's
intent may not have been to manipulate Air Canada stock, he broke
the rule on seven occasions by creating a false impression of
trading activity simply to avoid a loss.  This manipulative and
deceptive behaviour is a risk to the integrity of the Canadian
equity market."

                About Market Regulation Services

Market Regulation Services Inc. (RS) is the independent regulation
services provider for Canadian equity marketplaces, including TSX,
TSX Venture Exchange, Canadian Trading and Quotation System,
Bloomberg Tradebook Canada Company, Liquidnet Canada Inc., and
Markets Inc. upon commencement of its operations.  RS is
recognized by the securities commissions of Ontario, British
Columbia, Alberta and Manitoba and by the Autorite des marches
financiers in Quebec to regulate the trading of securities on
these marketplaces by participant firms and their trading and
sales staff.  RS helps protect investors and ensure market
integrity by ensuring all equities transactions are executed
properly, fairly and in compliance with trading rules.

                        About Air Canada

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

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

As of December 31, 2004, Air Canada's shareholders' deficit
narrowed to CDN$203 million compared to a $4.155 billion deficit
at December 31, 2003.


AMERICAN RESTAURANT: Completes Debt-for-Equity Swap
---------------------------------------------------
Black Angus Steakhouse successfully completed a financial
restructuring of its parent company, American Restaurant Group,
Inc., and its subsidiary companies that operate Black Angus
Steakhouse and Cattle Company Steakhouse.

The recently completed restructuring converted the Company's
senior secured notes for equity in exchange for the retiring of
the notes.  The restructuring reduced the company's debt,
strengthened its balance sheet, and increased its liquidity.
Additionally, the company has secured a four-year, $40 million
revolving credit facility to provide for on-going working capital
requirements.

"Black Angus has now been placed on a firm financial foundation
that will allow us to invest in our brand, our restaurant
facilities, and our people," Ralph Roberts, President and Chief
Executive Officer of Black Angus Steakhouse, said.  "Black Angus
Steakhouse new owners and the Black Angus Management team are
committed to the success of the Company.  Black Angus will now
compete with the benefits of a strong balance sheet and can move
forward with our plans to improve every aspect of the guest
experience."

Black Angus Steakhouse -- http://www.blackangus.com/-- operates
87 restaurants in ten western states.  The Black Angus menu
specializes in tender, USDA Choice fresh- cut steak; seasoned,
seared, and slow-roasted signature prime rib; and a variety of
seafood entrees.

Headquartered in Los Altos, California, American Restaurant Group,
Inc., through its subsidiaries operating as Stuart Anderson's,
specializes in U.S.D.A. Choice fresh-cut steak; seasoned, seared,
and slow-roasted prime rib; and a variety of seafood entrees
complete with 'all the fixin's'.  The company and its debtor-
affiliates filed for chapter 11 protection on Sept. 28, 2004
(Bankr. C.D. Calif. Case No. 04-30732).  Thomas R. Kreller, Esq.,
at Milbank, Tweed, Hadley & McCloy, represents the Debtors in
their restructuring efforts.  When the Debtors filed for
protection from their creditors, they listed $77,873,000 in total
assets and $273,395,000 in total debts.


AMHERST TECHNOLOGIES: Case Summary & 20 Largest Creditors
---------------------------------------------------------
Lead Debtor: Amherst Technologies, LLC
             40 Continental Boulevard
             Merrimack, New Hampshire 03054

Bankruptcy Case No.: 05-12831

Debtor affiliates filing separate chapter 11 petitions:

     Entity                                           Case No.
     ------                                           --------
     Amherst, LLC                                     05-12833
     Technology Consulting Services, Inc.             05-12834
     Amherst Distribution Services, LLC               05-12835
     Amherst GOV, LLC                                 05-12837
     Amherst Computer Products SouthWest, LP          05-12838
     Amherst SE, LLC                                  05-12839
     Amherst LA, LLC                                  05-12840
     Amherst West, LLC                                05-12841
     ACP Sales, LLC                                   05-12842
     ACP Sales SE, LLC                                05-12843

Type of Business: The Debtor offers enterprise class
                  solutions including wired and wireless
                  networking, server and storage optimization
                  implementations, document management
                  solutions, IT lifecycle solutions, Microsoft
                  solutions, physical security and surveillance,
                  and complex configured systems.  See
                  http://www.amherst1.com/

Chapter 11 Petition Date: July 20, 2005

Court: District of New Hampshire (Manchester)

Judge: J. Michael Deasy

Debtors' Counsel: Daniel W. Sklar, Esq.
                  Nixon Peabody LLP
                  889 Elm Street
                  Manchester, New Hampshire 03101
                  Tel: (603) 628-4000
                  Fax: (603) 628-4040

                              Estimated Assets   Estimated Debts
                              ----------------   ---------------
Amherst, LLC                  $10 Million to      $10 Million to
                              $50 Million         $50 Million

Technology Consulting         $10 Million to      $10 Million to
Services, Inc.                $50 Million         $50 Million

Amherst Distribution          $10 Million to      $10 Million to
Services, LLC                 $50 Million         $50 Million

Amherst GOV, LLC              $10 Million to      $10 Million to
                              $50 Million         $50 Million

Amherst Computer Products     $10 Million to      $10 Million to
SouthWest, LP                 $50 Million         $50 Million

Amherst SE, LLC               $10 Million to      $10 Million to
                              $50 Million         $50 Million

Amherst LA, LLC               $10 Million to      $10 Million to
                              $50 Million         $50 Million

AmherstWest, LLC              $10 Million to      $10 Million to
                              $50 Million         $50 Million

ACP Sales, LLC                $10 Million to      $10 Million to
                              $50 Million         $50 Million

ACP Sales SE, LLC             $10 Million to      $10 Million to
                              $50 Million         $50 Million

Consolidated List of Debtors' 20 Largest Unsecured Creditors:

   Entity                                   Claim Amount
   ------                                   ------------
Avnet IBM Software                               Unknown
P.O. Box 360761
Pittsburgh, PA 15250-6761

Avnet IBM Software                               Unknown
44500 Osgood Road
Fremont, CA 94538

Direct/Hewlett Packard Partner                   Unknown
P.O. Box 101149
Atlanta, GA 30392

B&H Photo Video                                  Unknown
420 9th Avenue
New York, NY 10001

PC Wholesale                                     Unknown
6820 South Harl Avenue
Tempe, AZ 85283

AVID VMI                                         Unknown
One Park West
Tewksbury, MA 01876

Altiris, Inc.                                    Unknown
P.O. Box 201584
Dallas, TX 75320-1584

Avnet HP Compaq                                  Unknown
P.O. Box 360761
Pittsburgh, PA 15250-6761

Ingram Micro                                     Unknown
P.O. Box 90350
Chicago, IL 60696-0350

Azerty Incorporated                              Unknown
Division of United Stationers Supply Co.
P.O. Box 7780-1724
Philadelphia, PA 19182-1724

Huge Systems/Ciprico, Inc.                       Unknown
NW-9931
P.O. Box 1450
Minneapolis, MN 55485

Customer Owned                                   Unknown
40 Continental Boulevard
Merrimack, NH 03054

Bell Micro Products                              Unknown
12778 Collections Center Drive
Chicago, IL 60693

EqualLogic                                       Unknown
9 Townsend West
Nashua, NH 03063

Microsoft Software                               Unknown
6100 Neil Road, Suite 120
Reno, NV 89511-1137

Proliant                                         Unknown
P.O. Box 360761
Pittsburgh, PA 15250-6761

Kingston Technology Corp.                        Unknown
P.O. Box 513388
Los Angeles, CA 90051-3388

Blue Willow Group                                Unknown
21175 Tomball Parkway
PBM 284
Houston, TX 77070

Nimax                                            Unknown
32713 Schoolcraft Road #103
Livonia, MI 48150

WebSense                                         Unknown
fka Net Partners
10240 Sorrento Valley Road
San Diego, CA 92121


AMPHENOL CORP: Earns $52 Million of Net Income in Second Quarter
----------------------------------------------------------------
Amphenol Corporation (NYSE-APH) reported net income of $52,056,000
for the second quarter 2005, compared to $40,367,000 for the
second quarter 2004.  Sales for the second quarter 2005 increased
15% to $443,642,000 compared to $387,119,000 for the 2004 period.
Currency translation had the effect of increasing sales by
approximately $7.5 million in the second quarter 2005 compared to
the 2004 period.

For the six months ended June 30, 2005, net income was $98,432,000
compared to $76,025,000 for the six months ended June 30, 2004.
Sales for the six months ended June 30, 2005 were $853,037,000
compared to $742,380,000 for the 2004 period.  Currency
translation had the effect of increasing sales by approximately
$15.2 million for the six month 2005 period when compared to the
2004 period.

                        Refinancing

In addition, on July 15, 2005, the Company completed a refinancing
of its senior credit facilities.  The new senior credit agreement
consists of a $750 million unsecured five year revolving credit
facility, of which approximately $440 million was drawn at
closing.  The net proceeds from the refinancing were used to repay
all amounts outstanding under the Company's previous senior
secured credit facilities and for working capital purposes.  In
conjunction therewith, the Company incurred one-time expenses for
the early extinguishment of debt totaling approximately $2.5
million (before tax benefit of $.8 million).

Amphenol Chairman and CEO, Martin H. Loeffler, stated "I am
extremely pleased with our second quarter results. Sales were up
15% compared to last year's second quarter to a record
$443,642,000.  The operating income margin increased from 17.8% to
19.4%.  The interconnect products segment of our business, which
represents 88% of our sales, was up a strong 16% over last year
with excellent profitability.  The growth was broad based across
all of our end markets and included all major geographic regions.
Growth was especially strong in the wireless infrastructure,
industrial and military and aerospace markets.  The excellent top
line results reflect our continuing development of new application
specific solutions and value added products for our customers, our
increased worldwide presence with the leading companies in our
target markets and acquisitions.  The improved profitability in
the interconnect business is also attributable to the continuing
development of new application specific products as well as higher
volumes and ongoing programs of cost control.  The cable products
segment of our business, which is primarily for broadband cable
television networks and represents 12% of our sales, was up 7%
over the prior year."

"In addition to excellent overall top line growth, profitability
and cash flow continued to be strong.  Earnings per share for the
quarter were up 29% over last year, representing the fourteenth
consecutive quarterly increase and a new record for the Company.
Furthermore, net income, that is income after interest expense and
taxes, exceeded 11% of sales, another indication of the Company's
excellent profitability. Cash flow from operations was also strong
at $49 million for the quarter."

"In addition, in May, the Company completed the acquisition of a
United States manufacturer of radio frequency interconnect
products for military and aerospace related markets.  The Company
has annual sales of approximately $20 million.  Including this
most recent acquisition, the Company has completed four
acquisitions since the beginning of the year.  We are excited
about the growth opportunities presented by these excellent
additions."

"We are also pleased to have completed the debt refinancing.  The
new five year facility is unsecured and has improved pricing in
recognition of the Company's strong operating performance,
substantial deleveraging and the achievement of an investment
grade credit rating from a major rating agency.  In addition, the
new facility will provide significantly increased flexibility to
pursue additional opportunities to expand and grow our business."

"It was a good quarter in all respects.  I am very proud of our
organization as we continue to execute well.  We have a strong
position in excellent and diversified markets and continue to
increase our presence with the major companies in these markets.
Assuming a continuation of the current economic climate and
relatively stable currency exchange rates, we are revising upward
our expectation for full year 2005 results to a sales increase in
the range of 13% to 15% and earnings per share increase in the
range of 23% to 26%; this compares to our prior estimates of sales
and earnings per share increases of 11% to 14% and 20% to 25%,
respectively. We expect third quarter results in the range of $435
million to $445 million and $.56 to $.58 for sales and EPS
respectively.  This guidance excludes the impact in the third
quarter of 2005 of one-time expenses associated with the
refinancing of $.02 per share.  We are very confident that we are
in excellent markets with a great organization, and we are very
excited about the future."

Amphenol Corporation is one of the world's leading producers of
electronic and fiber optic connectors, cable and interconnect
systems.  Amphenol products are engineered and manufactured in the
Americas, Europe and Asia and sold by a worldwide sales and
marketing organization.  The primary end markets for the Company's
products are communication systems for the converging technologies
of voice, video and data communications, industrial/automotive and
military/aerospace applications.

                         *     *     *

As reported in the Troubled Company Reporter on June 8, 2005,
Standard & Poor's Ratings Services raised its corporate credit and
bank loan ratings on Wallingford, Connecticut-based Amphenol Corp
to 'BBB-' from 'BB+' to reflect sustained improvements in the
company's financial profile, as demonstrated by reduced financial
leverage, improved cash flow adequacy, and expected moderate
financial policies, along with a history of relatively consistent,
strong operating performance.  The outlook is stable.

"The ratings on Amphenol Corp. reflect a solid business profile
and relatively moderate financial policies and leverage, offset in
part by limited overall business profile diversity," said Standard
& Poor's credit analyst Ben Bubeck.  Amphenol manufactures
connectors, cable, and interconnect systems for electronics, cable
television, telecommunications, and other applications.  It had
$476 million of funded debt outstanding at March 31, 2005.

Amphenol's financial profile is solid for the rating category,
having moderated substantially since the leveraged
recapitalization, when financial leverage peaked at 5.2x
unadjusted total debt to EBITDA, in 1998.  Debt reduction totaling
$505 million and growth in EBITDA profitability has reduced total
debt to EBITDA to 1.4x as of March 31, 2004.  When adjusted for
capitalized operating leases, securitized accounts receivables and
unfunded pension and post-retirement obligations, total debt to
EBITDA was 2.0x as of March 31, 2005, comfortable for the new
rating level.

The solid, although somewhat narrow, business profile is supported
by a good track record of profitability and moderate revenue
volatility, supported by long-standing significant positions
across a diverse set of end markets, in electronics interconnector
products, and a smaller position in the less profitable broadband
cable market.


ARTHUR TRACE: Case Summary & 5 Largest Unsecured Creditors
----------------------------------------------------------
Lead Debtor: Arthur Trace, L.L.C.
             5201 Highway 90 West
             Mobile, Alabama 36619

Bankruptcy Case No.: 05-13965

Debtor affiliates filing separate chapter 11 petitions:

      Entity                                     Case No.
      ------                                     --------
      Bennett Road Properties, L.L.C.            05-13966

Chapter 11 Petition Date: July 20, 2005

Court: Southern District of Alabama (Mobile)

Judge: Margaret A. Mahoney

Debtor's Counsel: Michael B. Smith, Esq.
                  P.O. Box 40127
                  Mobile, Alabama 36640
                  Tel: (251) 441-8077

                             Total Assets          Total Debts
                             ------------          -----------
Arthur Trace, L.L.C.           $1,270,000             $907,001

Bennett Road Properties,         $994,000             $673,601
L.L.C.

A. Arthur Trace, L.L.C.'s 2 Largest Unsecured Creditors:

   Entity                                      Claim Amount
   ------                                      ------------
   Carrol Norris                                     $2,000
   P.O. Drawer 161009
   Mobile, AL 36616

   Marilyn E. Wood                                       $1
   P.O. Box 1169
   Mobile, AL 36633-1169

B. Bennett Road Properties, L.L.C.'s 3 Largest Unsecured
   Creditors:

   Entity                     Nature of Claim       Claim Amount
   ------                     ---------------       ------------
   Washington Mutual Bank     Value of security:         $64,000
   P.O. Box 44118             $84,000
   Jacksonville, FL
   32231-4118

   Carrol Norris                                          $2,600
   P.O. Drawer 161009
   Mobile, AL 36616

   Marilyn E. Wood                                            $1
   P.O. Box 1169
   Mobile, AL 36633-1169


ATA AIRLINES: Chicago Express Inks $470K Settlement Pact with Saab
------------------------------------------------------------------
Saab Aircraft of America LLC has agreed to pay $469,557 to
Chicago Express Airlines, Inc., in full settlement of the parties'
obligations under a SAAB 340 Aircraft Parts Services Agreement,
dated July 5, 2000, as amended by Amendment to PEP Agreement dated
April 24, 2001.

Pursuant to Rule 9019 of the Federal Rules of Bankruptcy
Procedure, Chicago Express asks the U.S. Bankruptcy Court for the
Southern District of Indiana to approve its settlement agreement
with Saab.

Terry E. Hall, Esq., at Baker & Daniels, in Indianapolis, Indiana,
asserts that the settlement is fair and reasonable because it
removes the uncertainty and significant costs that would be
incurred in a litigation resolution.

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


ATA AIRLINES: Court Approves BCC Equipment Amendment Settlement
---------------------------------------------------------------
The Official Committee of Unsecured Creditors seeks continuance of
ATA Airlines, Inc. and its debtor-affiliates' request to enter
into the amended leases and settlement with BCC Equipment Leasing
Corporation.

The Committee relates that the Debtors and BCC have agreed to hire
an independent party, Aviation Specialist Group, to establish the
amount of BCC's claims against the Debtors with respect to 12
aircraft.

Andrew D. Stosberg, Esq., at Greenebaum, Doll & McDonald, PLLC, in
Louisville, Kentucky, points out that if the U.S. Bankruptcy Court
for the Southern District of Indiana immediately approves the
Settlement, BCC's damage claims would be ratified even before ASG
begins the process of estimating the claims.

The Creditors Committee wants to have an opportunity to review
ASG's computations to ascertain that the Damage Claims are not
overstated.

Mr. Stosberg notes that the Debtors and BCC agreed to make ASG
available for a deposition.  Yet, the Debtors and BCC are seeking
to back out of their commitments and are refusing to produce ASG
for a deposition.

                          Debtors Respond

The Debtors oppose any delays in the signing of the Amended Leases
and the Settlement.

Michael P. O'Neil, Esq., at Sommer Barnard Attorneys, PC, in
Indianapolis, Indiana, explains that under the new arrangements,
ATA will retain aircraft necessary for its reorganization and will
return the remaining aircraft to BCC for re-leasing to third
parties at staggered dates through January 2006.  One aircraft was
returned July 1, 2005, and another was scheduled for return on
July 15.

Originally, the parties hoped to obtain Court approval of the
Settlement by June 30, 2005, due to the July 1 scheduled return of
the aircraft.  Due to the Creditors Committee's request for time
to take depositions and discovery relating to the request, the
parties consented to the postponement of the hearing to July 13,
2005, even tough the Committee was not entitled to conduct the
discovery in the absence of a timely filed objection.

Mr. O'Neil adds that the parties have already revised the
Settlement to address the Creditors Committee's legitimate
concerns.  The added provisions to the Settlement are:

   (a) the Committee may interview or depose ASG to determine, in
       the Committee's view, whether ASG is competent and
       impartial;

   (b) if the Committee believes and notifies the Debtors and BCC
       that ASG is not competent or impartial to perform the
       services, then the parties will negotiate in good faith to
       identify and appoint a mutually acceptable appraiser;

   (c) if the parties cannot agree upon an appraiser, the Debtors
       and BCC will seek Court approval of either ASG or another
       appraiser or, if no agreement is possible, ask the Court
       to select an appraiser from a list of no more than six
       candidates comprised of two nominees each from the
       parties; and

   (d) the Debtors and BCC will use their best efforts to obtain
       approval of an appraiser on or before July 31, 2005.

Mr. O'Neil asserts that the liquidation procedure is fair and
equitable in light of:

   (a) the likelihood of success of litigating a more favorable
       liquidated value for BCC's claims;

   (b) the highly complex nature of valuing BCC's claims; and

   (c) the costs to be incurred by the estate in litigating a
       liquidated value for BCC's claims.

The discount rate to be used in the liquidating procedures is very
close to the rate advocated by the Creditors Committee's expert.

                          *     *     *

The Debtors, BCC and the Creditors Committee have resolved the
disputes by amending the confidential Settlement to terms amenable
to all parties.

Accordingly, Judge Lorch signs the Amended Settlement and the
Amended Leases.

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


ATRIUM COS: Default Notice on Sr. Notes Prompt S&P to Junk Ratings
------------------------------------------------------------------
Standard & Poor's Ratings Services lowered its ratings on Dallas,
Texas-based Atrium Cos. Inc. and its parent, Atrium Corp.  The
corporate credit ratings on both were lowered to 'CCC+' from 'B'.
In addition, Standard & Poor's revised the CreditWatch
implications to developing.  The companies were placed on
CreditWatch on June 2, 2005, with negative implications.

The rating actions follow Atrium's announcement that it has
received a notice of default from the trustee of its $174 million
senior discount notes related to the company's failure to deliver
2004 audited financial statements and first-quarter 2005 unaudited
financial statements.  Atrium has not filed its 2004 financial
statements because of an ongoing review of its 2003 financial
statements that uncovered a number of accounting errors, which
appear limited in scope at this point.  Atrium has a 30-day cure
period from July 13, 2005, to deliver the financial statements;
otherwise there would be an event of default under the indenture
and a possible acceleration of the notes.

"Although Atrium expects to seek a waiver for the delayed
financial statements from its bondholders, we are concerned that
the failure to obtain a waiver could lead to an acceleration of
the notes and a payment default," said Standard & Poor's credit
analyst Lisa Wright.

Atrium's ratings were placed on CreditWatch after the company
received a subpoena from the U.S. District Attorney's office in
Dallas about various accounting and financial records, the board
of directors placed its CEO on a leave of absence, and the CFO
resigned. After the CreditWatch action, the SEC also began an
informal inquiry.  Although the specific nature of the
investigations is unclear, this series of events raises the
specter of concern and uncertainty pertaining to the company's
prior management and accounting practices, investor confidence,
and the ability of Atrium to gain access to its $50 million
revolving credit facility.

"We will continue to monitor Atrium's relationship with its
creditors, the investigations, and the company's liquidity
position," Ms. Wright said.  "Ratings could be lowered if the
company fails to obtain the waiver from its bondholders, its
access to liquidity is restricted, or its financial profile is
affected by the investigations or further material adverse
revelations.  The ratings could be raised if Atrium receives a
waiver from its bondholders and its bank creditors continue to
extend their support."


BANCO INTERACCIONES: Moody's Rates Currency Deposits at Ba3
-----------------------------------------------------------
Moody's Investors Service assigned a bank financial strength
rating of E+ to Banco Interacciones, S.A.  At the same time,
Moody's assigned to the entity long- and short-term global local-
and foreign-currency deposit ratings of Ba3 / Not Prime.  The bank
was given long- and short-term Mexican National Scale deposit
ratings of A3.mx and MX-2, respectively.  The outlook on all
ratings is stable, according to the rating agency.

Moody's said that Interacciones' E+ BFSR reflects the bank's
modest financial fundamentals.  Although profitability is
recovering and the bank shows a mild turnaround from past losses,
it has yet to demonstrate its ability to maintain consistent
profits over time.

Moody's points out that the rating is also constrained by the
limited scope of its franchise, which makes the bank more
vulnerable to the intense competition exerted by the dominant
players in Mexico.

The BFSR incorporates Interacciones' specialization as an active
lender to public entities, with a substantial portion of its loans
going to states and municipalities.  Concentration risk is high,
but these exposures have relatively low credit risks.

Moody's believes that management may be challenged to sustain
profits and to strengthen the bank's funding mix, which is largely
wholesale of a short-term and expensive nature.  The much-needed
optimization of the cost structure would also bolster financial
strength.

The Ba3 / Not Prime for deposits and the Mexican National Scale
ratings of A3.mx / MX-2 incorporate the likelihood that
Interacciones' shareholders would contribute support --as
demonstrated in the past -- and would inject additional capital
into the bank.

Moody's noted that the stable outlook on Interacciones' ratings
reflects the bank's ability to maintain its current financial
metrics over the medium term.  The stable outlook also considers
that the bank would succeed in preventing any significant
deterioration in asset quality and in generating consistent
profitability over time

These ratings were assigned:

Outlook Stable

   * Bank Financial Strength Rating: E+
   * Global Local Currency Deposits: Ba3 / Not Prime
   * Foreign Currency Deposits: Ba3 / Not Prime
   * Mexican National Scale A3.mx / MX-2


BAYOU STEEL: Moody's Rates Proposed $50 Million Term Loan B at B3
-----------------------------------------------------------------
Moody's Investors Service assigned a B3 rating to Bayou Steel
Corporation's proposed $50 million term loan B.  The term loan
will be used, along with $18 million of incremental revolver
borrowings, to:

   * refinance $30 million of existing debt;
   * pay a $35 million dividend to shareholders; and
   * pay related transaction costs.

This is the first time Moody's has rated Bayou since it emerged
from Chapter 11 bankruptcy on February 18, 2004.  Bayou was
assigned a stable rating outlook.

These ratings were assigned to Bayou:

   * B2 corporate family rating (previously called senior implied)
   * B3 for the $50 million senior secured term loan B due 2012

Bayou's ratings are primarily constrained by the company's
aggressive financial policies, as evidenced by its willingness to
erase essentially all the retained earnings the company has earned
since emerging from bankruptcy for the purpose of paying a $35
million shareholder dividend.  The dividend will leave pro forma
book equity of $4 million and pro forma debt of $93 million at a
company that has generated negative $4.3 million of free cash flow
(CFO minus capex) since emerging from bankruptcy, a period that
coincided with extremely favorable steel markets.

The dividend payment is especially excessive in light of:

   1) the company's need to raise capex spending over the next two
      years in order to upgrade its fixed assets and strengthen
      its core operations; and

   2) the limited availability Bayou will have under its new
      revolver upon closing, approximately $19 million.

Secondarily, Bayou's ratings reflect:

   * its modest scale, heavy reliance on a single mill;

   * the commodity nature of its light structural and merchant bar
     steel products; and

   * an average cost position.

The ratings positively reflect:

   * Bayou's competitive conversion costs;

   * its access to low-cost inland waterway transportation for raw
     materials and finished goods; and

   * its fairly diversified product and customer base.

The ratings acknowledge that bar products in 2005 have thus far
not experienced the same magnitude of price cuts as have flat-
rolled steel, even though both sectors suffered from inventory
overhang in the first quarter.  Bar prices are down from 4Q04
highs but have generally moved in tandem with scrap prices.  Over
the last several years, competition in the bar sector has become
highly concentrated and this, combined with bar's more regional
market reach, may help bar product margins resist the compression
seen in flat-rolled products.  Nevertheless, Moody's expects
Bayou's margin over metal (the difference between selling prices
and scrap prices) to decline from recent highs.

The stable outlook reflects Moody's expectations that Bayou's
conversion costs will stabilize at recent levels and that, in the
likely event that selling prices decrease, Bayou's margin over
metal may decline but will remain higher than the $200/ton level
experienced in 2001-2003.  Bayou's rating outlook or ratings could
be lowered by:

   * mill operating problems;

   * higher-than-expected capex;

   * reduced liquidity;

   * additional shareholder distributions; and

   * a shrinkage of earnings or cash flow that, loosely translated
     into EBITDA, would lower EBITDA to approximately $15 million,
     or 2 times interest.

Factors that could result in a positive outlook or upgrade include
repayment of all revolver borrowings and a sustained EBITDA per
ton of $40 or greater.

Several recent performance indicators have made Moody's concerned
about Bayou's competitiveness and resilience should steel markets
soften.  Moody's notes that Bayou's finishing capacity utilization
was 83% in the six months ended March 31, 2005 (its fiscal year
ends September 30), which was below the industry average.  In
fact, in 1H05, Bayou's steel shipments of 228,000 tons were 8%
lower than in 2H04 and 23% lower than in 1H04.  The financial
impact of this drop in shipments was offset by 46% higher selling
prices and a similar increase in margin over metal, but the
inability of Bayou to maintain sales during a period of time that
saw generally favorable demand is troubling.  Moody's also notes
that Bayou's average selling price is lower than other long
product producers.  This indicates a more commodity-like mix of
products, which may be more prone to price erosion.

Despite recording EBITDA of $41 million, Bayou's free cash flow
has been negative since it emerged from bankruptcy on February 18,
2004.  In part, this was due to a $22 million increase in working
capital resulting from both rising costs and a need to restore
inventory volumes from unusually low levels.  Approximately $10
million of the working capital at March 31 represents high billet
inventory that Bayou plans to work through by September 30, 2005.
The company overestimated market demand late in 2004 and purchased
offshore billets that it planned to roll at its Harriman,
Tennessee mill.  However, the market did not improve as
anticipated, the billets are still in inventory, and will be
slowly reduced over the next six months.  The company has
indicated that the cash wrung out of inventory shrinkage will be
applied to reducing borrowings under the revolver.

Bayou has also increased its capex compared to recent years.  In
the first half of fiscal 2005, it spent $5 million for capex.
Capex is expected to remain relatively high in 2006 and 2007 as
the company undertakes maintenance projects that were deferred
while it was in bankruptcy and potentially invests in a new
warehouse, scrap operations, and new product initiatives.

The term loan has been notched down one notch from the corporate
family rating due to the modest value ascribed to the fixed assets
that secure the term loan.  The first lien collateral for the term
loan includes all fixed assets.  Because of fresh-start
accounting, the book value of Bayou's PP&E was only $8.5 million
as of March 31.  An orderly liquidation valuation performed while
the company was in bankruptcy valued its real property at $25
million, but this is still well-below the $50 million term loan.
The term loan also has a second lien on receivables and inventory,
which secures on a first priority basis the company's new $65
million revolving credit facility.  While there may be some
residual collateral value to the A/R and inventory over and above
the revolver's first lien claims, the residual is not sufficient
to warrant placing the term loan's rating at the corporate family
rating given potential swings in current asset balances and the
low book value of the fixed assets.  At March 31, 2005, the book
value of A/R was $25 million and the book value of inventory,
adjusted for $10 million of excess inventory, was $72 million.

Financial covenants under Bayou's revolver require that $10
million of availability be maintained at all times and, therefore,
the entire $65 million may not be available under the borrowing
base facility.  At closing, $43 million is expected to be drawn
and net availability is expected to be approximately $19 million.

Bayou Steel Corporation produces merchant bar and light structural
steel products and is headquartered in LaPlace, Louisiana.


BDR CORP: Hires Joseph Delay as Expert to Attack BofA's Claim
-------------------------------------------------------------
BDR Corporation sought and obtained permission from the U.S.
Bankruptcy Court for the Eastern District of Washington, Spokane
Division, to employ Joseph P. Delay, Esq., at Delay, Curran,
Thompson, Pontarolo & Walker, P.S., as its expert witness.

The Debtor chose Mr. Delay and his law firm because of their years
of experience in commercial law, real estate, and bankruptcy
matters.

Mr. Delay and the law firm of Delay Curran will serve as an expert
witness to the Debtor with respect to the Debtor's objection to
Bank of America's amended proof of claim.

Mr. Delay will be paid $200 per hour for his services.

The Debtor believes that Joseph P. Delay, Esq., and Delay, Curran,
Thompson, Pontarolo & Walker, P.S., are disinterested as that term
is defined in Section 101(14) of the U.S. Bankruptcy Code.

Headquartered in Veradale, Washington, BDR Corporation, filed for
chapter 11 protection on May 5, 2004 (Bankr. E.D. Wash. Case No.
04-03639).  John F. Bury, Esq., at Murphy, Bantz & Bury, P.S.,
represents the Debtor in its restructuring efforts.  When the
Debtor filed for protection from its creditors, it listed
$6,919,609 in assets and $6,925,123 in debts.


BEARINGPOINT INC: Secures Five-Year $150 Million Syndicated Loan
----------------------------------------------------------------
BearingPoint, Inc. (NYSE: BE) has secured additional capital by
closing a five-year $150 million line of credit with a syndicate
of banks including UBS Securities, LLC, completing the Company's
strategy for obtaining a long-term credit facility.  UBS will act
as issuing bank and administrative agent to the facility.

Key terms for the credit facility include:

   -- $150 million facility limit, but initial availability, based
      on accounts receivable borrowing base is approximately
      $100 million

   -- Interest rate of LIBOR plus 2% for first six months, with
      maximum spread over LIBOR of 2.25%

   -- Secured by all domestic assets of the Company and pledge of
      65% of the stock of the foreign subsidiaries

   -- Guarantors: all domestic subsidiaries

   -- Certain financial covenants do not apply unless unused
      availability is below specified minimums

Advances under the revolving credit line are limited by the
available borrowing base, which is based upon a percentage of
eligible accounts receivable.  The Company does not currently have
access to the entire $150 million because certain accounts
receivable for government contracts cannot be included in the
calculation of borrowing base without obtaining certain consents.

The proceeds under the 2005 Credit Facility will be used for
general corporate purposes of the Borrowers and their
subsidiaries.  At closing on July 19, 2005, the borrowing base was
approximately $102.8 million and the Company drew down
approximately $85.4 million in letters of credit to replace cash
collateral of approximately $82.7 million supporting issued
letters of credit.  After this drawdown borrowing availability was
approximately $17.4 million.  If the borrowing availability is
less than $15 million, the Company will be subject to additional
financial covenants.

The Company's obligations under the 2005 Credit Facility are
secured by liens and security interests in substantially all of
the present and future tangible and intangible assets of the
Company and certain domestic subsidiaries of the Company, as
guarantors of such obligations (including 65% of the stock of the
foreign subsidiaries of the Company), subject to certain
exceptions.

The commitments under the 2005 Credit Facility may be voluntarily
and permanently reduced or terminated in whole or in part by the
Company from time to time subject to these fees:

     (i) reductions or terminations on or prior to July 19, 2006
         shall result in a fee of 1.50%; and

    (ii) reductions or terminations between July 19, 2006, and
         July 19, 2007 shall result in a fee of 0.50%.

                     Financial Covenants

The 2005 Credit Facility contains affirmative, financial and
negative covenants.  The financial covenants include:

     (i) a minimum cash collections covenant requiring minimum
         cash collections of $125 million monthly and $420 million
         by the Borrowers on a rolling three month basis;

    (ii) a minimum trailing twelve-month EBITDA covenant which
         increases quarterly from $107.6 million (for the quarter
         ending Sept. 30, 2005) to $333.8 million (for the quarter
         ending March 31, 2009 and thereafter) as at the end of
         the applicable quarter;

   (iii) a maximum leverage ratio which decreases from 7.7:1.0
         (for the quarter ending Sept. 30, 2005) to 2.4:1.0 (for
         the quarter ending March 31, 2009 and thereafter) as at
         the end of the applicable quarter; and

    (iv) a maximum trailing twelve-month capital expenditures
         covenant which starts at $111.3 million for the quarter
         ending Sept. 30, 2005, and fluctuates thereafter
         including reducing to $89.7 million a year thereafter and
         ultimately remaining fixed at $94.1 million starting with
         the quarter ending Dec. 31, 2006.

The Company should become current in its SEC filings no later than
Dec. 31, 2005.  The Company must provide weekly reports with
respect to its cash position until it becomes current in its SEC
filings and has satisfactory collateral systems (i.e., internal
controls and accounting systems with respect to accounts
receivable, cash and accounts payable), at which time it should
provide monthly reports.  The Company should also provide monthly
reports with respect to its utilization and bookings data through
2005.

As soon as practicable but in no event later than Dec. 31, 2005,
the Company must have repatriated at least $65 million of cash of
foreign subsidiaries to a deposit account subject to a deposit
account control agreement of the Company in the U.S.

The 2005 Credit Facility matures on July 15, 2010 (unless on or
before Dec. 15, 2008, the Company's 5% Convertible Debentures due
2025 shall have not been:

     (i) fully converted into common stock of the Company or

    (ii) refinanced or replaced with securities that do not
         require the Company to make any principal payments
         (including, without limitation, by way of a put option)
         on or prior to July 15, 2010, in which case the 2005
         Credit Facility matures on December 15, 2008).

                      Equity Financing

In addition to the new debt financing, the Company disclosed that
it had raised $40 million from Friedman, Fleischer & Lowe, a
private equity investment firm.  In connection with the FFL
investment, Spencer Fleischer, Vice Chairman of Friedman,
Fleischer & Lowe, joined the Company's Board of Directors on
July 15, 2005.

Mr. Fleischer is not a member of any committee of the Board of
Directors.  If Mr. Fleischer ceases to be affiliated with the
Purchasers or ceases to serve on the Company's board, so long as
the Purchasers together hold at least 40% of the original
principal amount of the Debentures, the Purchasers or their
designee have the right to designate a replacement director to the
Company's board.

BearingPoint, Inc. (NYSE: BE) -- http://www.BearingPoint.com/
-- is one of the world's largest management consulting, systems
integration and managed services firms serving government
agencies, Global 2000 companies, medium-sized businesses and other
organizations. We provide business and technology strategy,
systems design, architecture, applications implementation, network
infrastructure, systems integration and managed services. Our
service offerings are designed to help our clients generate
revenue, reduce costs and access the information necessary to
operate their business on a timely basis. Based in McLean, Va.,
BearingPoint has been named by Fortune as one of America's Most
Admired Companies in the computer and data services sector.

                        *     *     *

As reported in the Troubled Company Reporter on Apr. 26, 2005,
Standard & Poor's Ratings Services ratings on McLean, Virginia-
based BearingPoint Inc. ('B-' corporate credit rating) remain on
CreditWatch, where they were placed March 18, 2005; however, the
implications have been revised to developing from negative.

"The CreditWatch revision reflects the additional near-term
liquidity provided by the $200 million aggregate principal amount
of 5% convertible senior subordinated debentures issued by the
company today," explained Standard & Poor's credit analyst Phil
Schrank.  BearingPoint intends to use net proceeds from the
offering to cash collateralize or replace letters of credit under
its existing credit facility, as well as to support future letter
of credit or surety bond requirements, to pay related expenses of
the offering, and for general corporate purposes.


BEARINGPOINT INC: Audit Committee Continues Oversight Review
------------------------------------------------------------
BearingPoint, Inc. (NYSE: BE) disclosed that the Audit Committee
of the Company's Board of Directors is continuing its oversight
review of issues concerning its internal control over financial
reporting and prior period adjustments.

The Audit Committee, advised by special counsel selected by the
Audit Committee, is investigating these issues, including alleged
deficiencies relating to the Company's OneGlobe financial
reporting system, which has been implemented in the Company's
North America operations, including an additional issue with
respect to accurate reporting of contract revenues entered into
the system in the second quarter of fiscal 2004.  This matter, and
other issues also being examined by the Audit Committee, were
raised, in part, by a non-executive employee communication.  The
staff of the Securities and Exchange Commission's Division of
Enforcement has been advised of the Audit Committee investigation.

                     Material Weaknesses

In a Form 8-K filing dated March 17, 2005, filed with the SEC, the
Company identified a number of control deficiencies, especially in
the areas of:

   -- contract revenue and accounts receivable;
   -- expenditures and accounts payable;
   -- payroll operations;
   -- the financial statement close process;
   -- leases and fixed assets; and
   -- the control environment in certain non-U.S. subsidiaries.

"We expect that most of these deficiencies will be classified as
material weaknesses and others may be classified as significant
deficiencies that in the aggregate may constitute material
weaknesses," the Company said in its regulatory filing.  "It also
is possible that additional material weaknesses will be identified
as we complete our assessment process.  We are now evaluating what
changes in internal control over financial reporting should be
implemented in order to fully address these material weaknesses
and other control deficiencies."

As a result of the identification of these material weaknesses,
management's assessment will conclude that the Company's internal
control over financial reporting is ineffective.

"We expect that our independent registered public accountants will
issue an adverse opinion on the effectiveness of our internal
control over financial reporting," the Company said in its current
report.

                  Possible Financial Adjustments

In addition, the Company preliminarily identified certain items
that will probably require adjustments to prior period financial
statements.  These adjustments will affect various quarters in
fiscal year 2004 and may affect the results of operations in
previous years, though the exact amount of the adjustments and the
periods to which they relate have not been determined.  The nature
and approximate amounts of the more significant adjustments that
have been identified based solely on procedures performed to date
are:

   -- write-downs relating to contract revenues resulting from
      inaccurate entries of approximately $10-$12 million that
      were made by a foreign operation and that are under
      investigation;

   -- charges relating to employee tax equalization issues; and

   -- charges arising from detailed engagement contract reviews.

"Also, we have determined that there has been an impairment of
goodwill as of Dec. 31, 2004, with respect to operations in its
Europe, the Middle East and Africa segment and will record a non-
cash fourth quarter charge," the Company said.  As of Sept. 30,
2004, the goodwill for the EMEA segment was $802.7 million.  "The
amount of the charge, cannot be reasonably estimated at this time.
However, it will likely have a substantial impact on our results
of operations for FY04," the Company added.

                        Late Financials

Until the investigation is complete, the Company will not be able
to release its audited financial statements for the year ended
Dec. 31, 2004, and subsequent interim financial statements.  At
this time, the Company cannot determine when the Audit Committee
investigation will be concluded or what impact, if any, this
investigation will have on prior periods.

BearingPoint, Inc. (NYSE: BE) -- http://www.BearingPoint.com/--
is one of the world's largest management consulting, systems
integration and managed services firms serving government
agencies, Global 2000 companies, medium-sized businesses and other
organizations. We provide business and technology strategy,
systems design, architecture, applications implementation, network
infrastructure, systems integration and managed services. Our
service offerings are designed to help our clients generate
revenue, reduce costs and access the information necessary to
operate their business on a timely basis. Based in McLean, Va.,
BearingPoint has been named by Fortune as one of America's Most
Admired Companies in the computer and data services sector.

                        *     *     *

As reported in the Troubled Company Reporter on Apr. 26, 2005,
Standard & Poor's Ratings Services ratings on McLean, Virginia-
based BearingPoint Inc. ('B-' corporate credit rating) remain on
CreditWatch, where they were placed March 18, 2005; however, the
implications have been revised to developing from negative.

"The CreditWatch revision reflects the additional near-term
liquidity provided by the $200 million aggregate principal amount
of 5% convertible senior subordinated debentures issued by the
company today," explained Standard & Poor's credit analyst Phil
Schrank.  BearingPoint intends to use net proceeds from the
offering to cash collateralize or replace letters of credit under
its existing credit facility, as well as to support future letter
of credit or surety bond requirements, to pay related expenses of
the offering, and for general corporate purposes.


BEARINGPOINT INC: Expects to File Tardy Financials by September
---------------------------------------------------------------
BearingPoint, Inc. (NYSE: BE) indicated that it continues to
complete its financial statements for calendar year 2004 and is
putting other related SEC filings in top priority.  To this end,
it has devoted substantial additional internal and external
resources to the completion of the 2004 financial statements.

As a result, the Company expects to complete its 2004 financial
statements and related SEC filings by the end of summer in
September, with the Company's Forms 10-Q for the first and second
quarters of 2005 to be filed concurrently or shortly thereafter.

In addition to approximately $25 million in previously expected
Sarbanes-Oxley-related fees and $15-$20 million in previously
expected audit fees, it would spend between $50 million to
$60 million to cover other third party expenses associated with
assistance in preparation of its fiscal year 2004 results and
preparing the financial results of the first and second quarters
of fiscal year 2005, as well as the previously disclosed possible
restatements of prior fiscal years.  While the Company does not
expect the third party expenses and other expenses relating to the
preparation of its financial results for future periods to remain
at this level, it expects that these expenses will remain
relatively higher than historical expenses in this category for
the next several quarters.

                   Second Quarter 2005 Filing

The Company has determined that it will not complete its financial
statements for the second quarter of 2005 by the Aug. 9, 2005,
filing date for its Form 10-Q.  The Company will file a Form 12b-
25 with the SEC on or prior to Aug. 10, 2005, to further discuss
the status of the Form 10-Q filing.  Also as previously disclosed,
the Company currently believes that it will not file its Form 10-Q
for the third quarter of 2005 in a timely fashion.

BearingPoint, Inc. (NYSE: BE) -- http://www.BearingPoint.com/
-- is one of the world's largest management consulting, systems
integration and managed services firms serving government
agencies, Global 2000 companies, medium-sized businesses and other
organizations. We provide business and technology strategy,
systems design, architecture, applications implementation, network
infrastructure, systems integration and managed services. Our
service offerings are designed to help our clients generate
revenue, reduce costs and access the information necessary to
operate their business on a timely basis. Based in McLean, Va.,
BearingPoint has been named by Fortune as one of America's Most
Admired Companies in the computer and data services sector.

                        *     *     *

As reported in the Troubled Company Reporter on Apr. 26, 2005,
Standard & Poor's Ratings Services ratings on McLean, Virginia-
based BearingPoint Inc. ('B-' corporate credit rating) remain on
CreditWatch, where they were placed March 18, 2005; however, the
implications have been revised to developing from negative.

"The CreditWatch revision reflects the additional near-term
liquidity provided by the $200 million aggregate principal amount
of 5% convertible senior subordinated debentures issued by the
company today," explained Standard & Poor's credit analyst Phil
Schrank.  BearingPoint intends to use net proceeds from the
offering to cash collateralize or replace letters of credit under
its existing credit facility, as well as to support future letter
of credit or surety bond requirements, to pay related expenses of
the offering, and for general corporate purposes.


BEAR STEARNS: S&P Lowers Rating on Class B Certificates to D
------------------------------------------------------------
Standard & Poor's Ratings Services lowered its ratings on classes
B and M-2 from Bear Stearns Asset Backed Securities Inc.'s series
1998-1 to 'D' from 'CCC' and to 'A-' from 'A', respectively.
Concurrently, the rating is affirmed on the remaining M-1 class
from the same transaction.

The rating on class B was lowered due to the complete erosion of
the overcollateralization, leading to a write-down to the
principal balance of the class during the June 2005 remittance
period.  The rating on class M-2 was lowered due to the
deterioration of available credit support provided by
overcollateralization and subordination.  The transaction has
continued to incur sporadic net losses with minor recoveries,
which have held overcollateralization below its floor of 0.50% of
the original pool balance ($490,904) for over two years.

As of the July 2005 distribution date, cumulative realized losses
were 3.40% of the original pool balance, while total delinquencies
were 30.01%.  Serious delinquencies (90-plus-days, foreclosure,
and REO) were 17.30%.  While merely 2.43% of the pool balance
remains, substantial losses that have periodically outpaced excess
interest cash flow have contributed to the complete erosion of the
overcollateralization to 0.00% of the original pool balance, from
its original target of 7.00%.

Despite the high delinquencies and the uneven performance of the
transaction, the affirmation of the remaining M-1 class reflects
adequate actual and projected credit support provided by
subordination and, to a lesser extent, excess interest and
overcollateralization.  Standard & Poor's will continue to monitor
the transaction closely.

The underlying collateral for this transaction consists of
adjustable-rate, 30-year first-lien mortgage loans secured by one-
to four-family residential properties.

                          Ratings Lowered

             Bear Stearns Asset Backed Securities Inc.

                                          Rating
                                          ------
                 Series     Class       To     From
                 ------     -----       --     ----
                 1998-1     B           D      CCC
                 1998-1     M-2         A-     A

                          Rating Affirmed

             Bear Stearns Asset Backed Securities Inc.

                    Series     Class    Rating
                    ------     -----    ------
                    1998-1     M-1      AA


BE SMART: Case Summary & 20 Largest Unsecured Creditors
-------------------------------------------------------
Debtor: Be Smart Kids, Inc.
        609 Asheville Highway
        Greeneville, Tennessee 37743

Bankruptcy Case No.: 05-08574

Type of Business: The Debtor offers educational
                  programs for children aged 1 to 5.
                  See http://www.besmartkids.com/

Chapter 11 Petition Date: July 20, 2005

Court: Middle District of Tennessee (Nashville)

Judge: George C. Paine

Debtor's Counsel: Robert J. Gonzales, Esq.
                  MGLAW PLLC
                  120 30th Avenue North, Suite 1000
                  Nashville, TN 37203
                  Tel: (615) 846-8000
                  Fax: (615) 846-9000

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

Estimated Debts:  $1 Million to $10 Million

Debtor's 20 Largest Unsecured Creditors:

   Entity                     Nature of Claim       Claim Amount
   ------                     ---------------       ------------
Robert McLean                                           $785,000
805 South Church Street,
Suite 11
Murfreesboro, TN 37130

Fred Goad                                               $109,624
5123 Virginia Way
C22 Paddock 3
Brentwood, TN 37027

Bank of America Platinum Visa                            $27,501
P.O. Box 2463
Spokane, WA 99210-2463

Princeton Training                                       $23,825
Associates Inc.

Titshaw Properties                                       $21,803

Sherrard & Roe PLC                                       $21,192

Terry Bryant                                             $15,000

DLF Communications Services                              $11,620

Capital One                                              $10,630

American Appraisal Associates                             $9,079

UPS                                                       $7,731

Encore Interactive Solutions                              $7,500

Dempsey Vantrease & Follis                                $5,327
PLLC

IRS                           Balance of 1Q 2005          $4,877
                              payroll taxes

Provident Solutions LLC                                   $3,753

Little Planet Learning                                    $3,112

Day Communications Inc.                                   $2,800

Daily News Journal                                        $2,032

Homer Marcum                                              $1,849

Nuvox Communications                                      $1,095
of Tennessee


BLUE DOLPHIN: Scrapes Up $600,000 Working Capital for 2005
----------------------------------------------------------
In its Form 10-Q for the quarterly period March 31, 2005, Blue
Dolphin Energy disclosed that, at the beginning of 2005,
management estimated that the Company would need to raise
approximately $500,000 to satisfy liquidity and working capital
requirements through 2005.

Although the Company has not raised capital in 2005, it has been
able to work with its creditors and restructure the terms of its
indebtedness.  As a result of this and other actions taken in
2004, management now believes that there is sufficient liquidity
and working capital at March 31, 2005, to satisfy the Company's
requirements through March 31, 2006.  At March 31, 2005, Blue
Dolphin Energy Company's working capital was approximately
$600,000.

While Blue Dolphin Energy has been able to implement cost savings
measures and restructure the terms of some of its indebtedness it
was not able to generate sufficient cash from operations to cover
operating costs and general and administrative expenses.

Furthermore, the Company's financial condition has been
significantly and negatively affected by the poor performance of
its businesses and by its significant indebtedness.  For the three
months ended March 31, 2005, the Company generated total revenues
of approximately $360,000, while operating costs and general
administrative expenses totaled approximately $732,000.  The
Company reported a net loss for the three months ended March 31,
2005 of $196,992 compared a net loss of $519,606 reported for the
three months ended March 31, 2004.

                      Payments to Tetra

In August 2004, Blue Dolphin extended the remaining payments
totaling $668,000 due in September and October 2004 to Tetra
Applied Technologies, Inc. for the abandonment/reefing of the
Buccaneer Field.  Under the revised terms, on September 1, 2004
Blue Dolphin began paying Tetra the outstanding balance in twelve
monthly installments of $55,667, plus interest, on the outstanding
balance at the rate of 6% per annum.  As of March 31, 2005, the
remaining balance due Tetra was approximately $280,000.

                       Promissory Notes

On Sept. 8, 2004, the Company entered into a Note and Warrant
Purchase Agreement with certain accredited investors and certain
of the Company's directors for the purchase and sale of promissory
notes in an aggregate principal amount of $750,000 and 2,800,000
warrants to purchase shares of Company common stock at a purchase
price of $0.003 per Warrant.  The sale of the Promissory Notes and
the first tranche of 1,250,000 initial Warrants closed on
September 8, 2004, and the closing of the sale of the second
tranche of 1,550,000 additional Warrants closed on Nov. 30, 2004
after Blue Dolphin received stockholder approval of the issuance
of the additional Warrants at its Nov. 11, 2004, special
stockholders meeting.

The Company received proceeds of $758,400 from the issuance of the
Promissory Notes and the Warrants.  The Promissory Notes mature on
Sept. 8, 2005, and accrue interest at a rate of 12.0% per annum,
of which 4% is payable monthly and 8% is payable at maturity.

However, in April 2005, the holders of $450,000 aggregate
principal amount of Promissory Notes agreed to extend the maturity
date of their Promissory Notes to June 30, 2006, and to defer the
payment of all interest on their Promissory Notes until maturity.
In exchange for extending the maturity of the Promissory Notes,
Blue Dolphin waived compliance with the lock-up provisions of the
Purchase Agreement allowing them to sell shares of the Company's
common stock that they may receive upon exercise of their
Warrants, and to accelerate the date Blue Dolphin is required to
file a registration statement registering the resale of their
shares of common stock that they may acquire upon exercise of
Warrants to May 15, 2005.

As of March 31, 2005, the Company issued 743,969 shares of common
stock as a result of the exercise of Warrants, and in April and
May 2005, it issued an additional 1,252,347 shares of common stock
as a result of the exercise of Warrants.  The exercise of the
Warrants was accomplished via net exercises, whereby holders
surrendered their right to receive 212,021 shares of common stock.
Blue Dolphin filed a Form S-3 registration statement with the
Securities and Exchange Commission on May 12, 2005 to register the
shares of common stock that were issued pursuant to the exercise
of warrants and shares that are issuable upon exercise of
warrants.

Blue Dolphin Energy Company -- http://www.blue-dolphin.com/-- is
engaged in the gathering and transportation of natural gas and
condensate.

                     Going Concern Doubt

As reported in the Troubled Company Reporter on March 29, 2005,
the Company's auditors, UHY Mann Frankfort Stein & Lipp CPAs, LLP,
raised substantial doubt about Blue Dolphin's ability to continue
as a going concern due to the Company's on-going liquidity
problems.  For the year ended Dec. 31, 2004, the Company generated
total revenues of approximately $1.4 million while operating costs
and general administrative costs, excluding certain non-cash
compensation expense, totaled approximately $2.8 million.


BREED TECHNOLOGIES: Jones Day Lawyer Accused of Actual Conflict
---------------------------------------------------------------
A group of bondholders serving on the Official Committee of
Unsecured Creditors in Reorganized Breed Technologies, Inc.'s
chapter 11 cases and AlliedSignal, Inc. (n/k/a Honeywell
International Inc.), accuse Geoffrey S. Stewart, Esq., at Jones
Day of actual conflicts of interest that need to be explored by
the Bankruptcy Court before Breed's chapter 11 case is closed.

The Bondholders and AlliedSignal dropped that bombshell in the
U.S. Bankruptcy Court for the District of Delaware in response to
a seemingly innocuous request by the Reorganized Debtor to close
its chapter 11 case.

As previously reported in the Troubled Company Reporter on July 7,
2005, Breed's Third Amended Joint Plan of Reorganization was
confirmed on November 22, 2002, and the Plan took effect on
December 26, 2000.  Pursuant to the Plan, two separate trusts, The
Breed Creditor Trust and AlliedSignal Recovery Trust, were created
to administer and distribute certain assets to creditors.

The BREED Creditor Trust administers all avoidance actions.  The
Trustee of the Breed Creditor Trust discloses that no further
avoidance action lawsuits are required in the Debtor's chapter 11
case since the only remaining avoidance action claims is a
$475,000 claim in the bankruptcy proceeding of MCI WorldCom.

The AlliedSignal Recovery Trust administers the AlliedSignal,
Inc., nka Honeywell International Inc., Litigation.  The lawsuit
seeks compensatory damages of not less than $325 million for fraud
and misrepresentation and an award of not less than $710 million
for fraudulent transfer claims.  Distributions under this Trust
cannot be made unless the AlliedSignal Litigation, set for trial
in late 2005, is resolved in favor of the Trust.

Honeywell is presently in litigation with the AlliedSignal
Recovery Trust in the Circuit Court for the Florida Tenth Judicial
Circuit.  Over the last year, Honeywell has learned of facts
concerning conflicts of interest that Jones Day, special
litigation counsel to Breed (and later the Recovery Trust), failed
to disclose in its application filed in the Bankruptcy Court in
1999.  Most significantly, Honeywell says, Jones Day did not
disclose that its lead partner on the matter, Mr. Stewart, on the
eve of bankruptcy and before submitting his affidavit to this
Court, represented Johnnie Breed, the Debtor's CEO, in her
personal capacity and participated in meetings concerning a
"creditor protection plan" designed to shield her personal assets
from the very creditors Mr. Stewart now purports to represent.

AlliedSignal has a motion currently pending in the Florida
Litigation that seeks to disqualify Mr. Stewart on the ground
that, as a critical fact witness, he may not serve as lead trial
counsel under Florida ethics rules, as well as on the basis of his
irreconcilable conflicts of interest and his inadequate disclosure
in the Bankruptcy Court.  Jones Day tells the Florida Court that
the bankruptcy disclosure issues are "abundantly moot" and not to
be decided by the Florida court.  AlliedSignal says it doesn't
agree that Breed and the Recovery Trust were free to disregard the
federal Bankruptcy Code or its disclosure obligations in retaining
Mr. Stewart.

Honeywell is represented by:

          Eugene F. Assaf, Esq.
          Craig S. Primis, Esq.
          Padraic B. Fennelly, Esq.
          KIRKLAND & ELLIS LLP
          655 15th Street, N.W., Suite 1200
          Washington, D.C. 20005
          Telephone (202) 879-5000

The Bondholders, holding more than $100,000,000 of the Debtor's
$330,000,000 issue of 9-1/2% Senior Subordinated Notes due 2008,
are:

     * American High-Income Trust
     * The Bond Fund of America, Inc.,
     * The Income Fund of America, Inc.
     * American Funds Insurance Series -- Bond Fund
     * American Funds Insurance Series -- High-Yield Bond Fund
     * Anchor Pathway Fund -- High-Yield Bond Series
     * Capital Guardian U.S. Fixed-Income Master Fund and
     * Capital Guardian Global High-Yield Income Fund

The Bondholders are represented by:

          James J. Sabella, Esq.
          GRANT & EISENHOFER, P.A.
          45 Rockefeller Center, 15th Floor
          New York, NY 10111
          Telephone (646) 722-8500

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.


CAN-CAL RESOURCES: Losses Trigger Going Concern Doubt
-----------------------------------------------------
L.L. Bradford & Company, LLC, expressed substantial doubt about
Can-Cal Resources, Ltd.'s ability to continue as a going concern
after it audited the Company's financial statements for the year
ended Dec. 31, 2004.  The firm points to the Company's losses from
operations and working capital deficit.

The Company incurred a net loss of approximately $138,500 for the
three months ended March 31, 2005.  The Company's current
liabilities exceed its current assets by approximately $823,500 as
of March 31, 2005.  The Company's management plans to continue to
fund its operations in the short term with a combination of debt
and equity financing, as well as revenue from operations in the
long term.

As of March 31, 2005, the Company had a working capital deficit of
$823,500 and approximately $153,700 cash was available to sustain
operations, which would cover the Company's planned activities
through June 2005, at a minimum.  The working capital deficit as
of December 31, 2004, was $847,200 and approximately $68,600 cash
was available.  The Company plans to seek additional capital by
the sale of restricted shares of common stock in private placement
transactions in Canada, loans from directors, or possible funding
or joint venture arrangements with other mining companies.

                     IBK Capital Financing

On January 29, 2004, the Company entered into an agreement with
IBK Capital Corp., whereby IBK agreed to assist the Company in
arranging financing of up to $1,000,000 on terms to be negotiated.
The agreement has been extended at six-month intervals and is
presently effective through July 28, 2005 and may be terminated or
extended by either party upon 15 days advance notice in writing.
As of March 31, 2005, no financing had been finalized.  Other than
the IBK agreement, there are no plans or arrangements now in place
to fund the Company by any of the means noted above, and the
outcome of the discussions with other companies cannot be
predicted.

                          Default

The Company is in default of its semi-annual interest payment of
$24,000 for 2002, 2003 and 2004, totaling $144,000 at the end of
2004, on a note payable of $300,000.  The Company is currently
negotiating forbearance on collection of the interest.

Can-Cal Resources Ltd. is a public company trading on the O.T.C.
Bulletin Board (Symbol: CCRE). The Company is engaged in the
acquisition, exploration and development of precious metals
mineral properties. As part of its future growth strategy, the
Company will focus its efforts in the Western Hemisphere, with an
emphasis on Latin America, particularly Mexico.

At Mar. 31, 2005, Can-Cal Resources Ltd.'s balance sheet showed a
$791,000 stockholders' deficit, compared to an $813,500 deficit at
Dec. 31, 2004.


CAN-CAL RESOURCES: Scraps Pinos Project With Minera Apolo
---------------------------------------------------------
On July 18, 2005, Can-Cal Resources Ltd. (OTCBB:CCRE) and its
wholly owned Mexican subsidiary, Sierra Madre Resources S.A. de
C.V., said that following extensive consultation, and based on the
Company's due diligence review, it will not proceed on its
proposed joint venture with Minera Apolo S.A. de C.V., otherwise
known as the "Pinos Project".

The Company's decision is consistent with its joint venture
agreement and letter of intent with Minera Apolo.  Both the
Agreement and the Letter of Intent contained an option whereby the
Company had a 90-day period to conduct due diligence it deemed
appropriate before electing to proceed with the exploration and
exploitation of the concessions.

Minera Apolo was paid an initial 107,143 shares of the Company's
restricted common stock, equivalent to $24,000 in equity.  Based
on the Company's decision not to proceed with the Pinos Project,
Minera was paid an additional 111,607 shares of the Company's
restricted common stock, equivalent to $25,000 in equity.

The Company is currently focusing its research and development
efforts on the Company's U.S. properties.

                       Pinos Project

In March 2005, the Company signed two option agreements to acquire
interests in the mining rights to 29 gold-silver concessions,
covering approximately 3,100 hectares (approximately 7,700 acres).
The concessions are located in a historic mining district in the
Municipality of Pinos, Zacatecas State, Mexico and are owned by a
private Mexican company, Minera Apolo S.A. de C.V.

Sierra Madre Resources S.A. de C.V, the Company's wholly owned
Mexican subsidiary, and Minera Apolo, signed an Exploration and
Exploitation Agreement, whereby SMR can earn a 51% Joint Venture
interest in an approximate 130 hectare area, referred to as the
Catanava Block, covered by all, or portions of, 7 of the 29
concessions.  SMR and Minera Apolo also signed a Letter of Intent,
whereby SMR can separately acquire a 100% interest in the mining
rights to the remaining hectares not covered by the Agreement.
Both the Agreement and the LOI contain an option, whereby SMR has
a 90-day period to conduct due diligence and whatever geological
programs it deems appropriate before electing to proceed with the
exploration and exploitation of the concessions.

Can-Cal Resources Ltd. is a public company trading on the O.T.C.
Bulletin Board (Symbol: CCRE). The Company is engaged in the
acquisition, exploration and development of precious metals
mineral properties. As part of its future growth strategy, the
Company will focus its efforts in the Western Hemisphere, with an
emphasis on Latin America, particularly Mexico.

At Mar. 31, 2005, Can-Cal Resources Ltd.'s balance sheet showed a
$791,000 stockholders' deficit, compared to an $813,500 deficit at
Dec. 31, 2004.


CAROLINA TOBACCO: Wants Until Sept. 19 to Decide on Leases
----------------------------------------------------------
Carolina Tobacco Company asks the U.S. Bankruptcy Court for the
District of Oregon to extend, until Sept. 17, 2005, the time
within which it must assume, assume and assign or reject its
unexpired nonresidential real property leases pursuant to Section
364(d) of the Bankruptcy Code.

The Debtor tells the Court that its chapter 11 case is large and
complex.  Also, the Debtor's leased premises are essential to its
operations because the locations include its current manufacturing
facility and administrative offices.

The Debtor adds it doesn't want to make premature assumption or
rejection decisions about any lease which might prove useful or
cumbersome to the estate.

Headquartered in Portland, Oregon, Carolina Tobacco Company
-- http://www.carolinatobacco.com/-- manufactures Roger-brand
cigarettes.  The Company filed for chapter 11 protection on
April 18, 2005 (Bankr. D. Ore. Case No. 05-34156).  Tara J.
Schleicher, Esq., at Farleigh Wada & Witt P.C., represents the
Debtor in its restructuring efforts.  When the Debtor filed for
protection from its creditors, it listed total assets of
$24,408,298 and total debts of $14,929,169.


CENVEO INC: Proxy Filing Prompts S&P to Retain Developing Watch
---------------------------------------------------------------
Standard & Poor's Ratings Services ratings on commercial printer
Cenveo Inc., including its 'B+' corporate credit rating, remain on
CreditWatch with developing implications.

The ratings were placed on CreditWatch on April 18, 2005,
following the company's announcement it was exploring strategic
alternatives, which could include a sale of the company.  The
Englewood, Colorado-based company had more than $850 million in
lease-adjusted debt outstanding as of March 2005.

Ratings could be affected either positively or negatively,
depending on whether a transaction ultimately occurs.  An example
of a transaction that might have a positive effect would be an
acquisition by a higher-rated entity.  An example of a transaction
that could have a negative impact might include a decision to
increase debt levels to pursue an acquisition or a
recapitalization.

There is an additional element of downside pressure on ratings
following Cenveo's announcement in the company's July 2005 proxy
filing related to change of control provisions in their creditor
agreements.  Cenveo stated that the election of a new board of
directors at the special meeting of stockholders, scheduled for
September 2005, would trigger change of control provisions in the
company's agreements.  If bondholders in turn exercise their put
rights, the need to refinance a meaningful portion of the capital
structure within a relatively short period of time could pressure
Cenveo's ratings, and therefore, in the absence of an adequate
refinancing plan could result in the change of the CreditWatch
status to negative from developing.

In resolving its CreditWatch listing, Standard & Poor's will
continue to monitor developments associated with the company's
pursuit of strategic alternatives, and consider the ratings
implications of the outcome of the special stockholder meeting.
"We are unlikely to resolve the CreditWatch listing until there is
clarity regarding a potential transaction and the outcome of the
special stockholder meeting," said Standard & Poor's credit
analyst Emile Courtney.


COLLINS & AIKMAN: Committee Wants to Reject Unprofitable Contracts
-----------------------------------------------------------------
The Official Committee of Unsecured Creditors in Collins & Aikman
Corporation and its debtor-affiliates' chapter 11 cases asks the
U.S. Bankruptcy Court for the Eastern District of Michigan to
compel the Debtors to immediately reject all unprofitable,
burdensome Contracts and close or moth ball all unprofitable
Plants.

It is undisputed that the Debtors are burning substantial amounts
of cash on a daily basis, James S. Harrington III, Esq., at Butzel
Long, in Bloomfield Hills, Michigan, tells the Court.  It is also
undisputed, Mr. Harrington adds, that two of the primary causes of
their liquidity crisis are burdensome contracts with a number of
their customers and under-performing manufacturing facilities.
Indeed, Mr. Harrington notes, the Debtors have advised the Court
that they cannot successfully reorganize, let alone survive in
Chapter 11, if they continue to be bound by the terms of their
current Contracts with their customers.  However, no action has
been taken by the Debtors or their customers to provide the
Debtors with the substantial economic relief they desperately need
with respect to these Contracts.

In the absence of immediate rejection of the Contracts and the
closing of the Plants, Mr. Harrington expects that the Debtors
will continue to burn cash at a rapid pace, will be unable to
maintain operations, and will be headed for liquidation in the
very near term.  The only way for the Debtors to have a realistic
opportunity of reorganizing and maximizing value of their estates
for the benefit of their creditors is to reject immediate the
Contracts and close or "moth ball" the unprofitable Plants.

"Continuing operations under Contracts and at Plants that are
uneconomical and have cost these Debtors hundreds of millions of
dollars, and which continue to cause the Debtors to burn cash at
an alarming rate -- in excess of $150 million on a postpetition
basis with $30 million of additional financing expected to last
only days -- requires the Debtors to act without delay," Mr.
Harrington urges.

                          Contracts

The Contracts have proven to be unprofitable because they require
that the Debtors provide products at predetermined prices.  The
Contracts also provide for the supply of a customer's annual
requirements for a particular model or assembly plant, renewable
on a year-to-year basis, rather than for the purchase of a
specific quantity of products.  In some cases, prices declined
over the course of the Contract while the Debtors were unable to
increase prices as the costs of labor, components or materials
increased.

In addition, the Debtors agreed to certain price decreases and
givebacks with certain customers.  The reductions were generally
in the 3% to 4% range and have not been renegotiated despite the
Debtors' inability to operate at a profit under the Contracts.
Moreover, during the second half of 2004, several of the Debtors'
customers terminated their accelerated payments programs under
the Contracts, which adversely affected the Debtors' short-term
liquidity position by pushing back the dates by which they
receive future payments.

                          Debtors Respond

The Debtor asks the Court to deny the Committee's motion saying
that the scenario that the Committee presents is not and has never
been a realistic alternative.

According to Joseph M. Fischer, Esq., at Carson Fischer, P.L.C.,
in Birmingham, Michigan, that scenario would not provide the
Debtors the liquidity that they must have to operate during the
time that the Committee would have them engaging in the proposed
massive contract renegotiation and rejection of contracts and the
closing of the plants.  There is a substantial risk that granting
the Motion would send the Debtors into a tailspin leading to
liquidation, not reorganization.  Mr. Fischer cites In re At Home
Corp., No. 01-3-2495 (Bankr. N.D. Cal. Nov. 30, 2001), wherein
immediate liquidation of the debtors is precisely what happened
after the rejection of contracts with key customers.

Moreover, the Motion ignores the fundamental reality that it will
require an enormous amount of analysis and work to resolve the
status of all of the Debtors' contracts and plants.  The Debtors
manufacture tens of thousands of parts pursuant to literally
thousands of agreements, purchase orders and amendments and
operate over 50 plants.  To determine which contracts need to be
rejected and which plants can be operated profitably, the Debtors
need to assess the profitability of each on a stand-alone basis.
This is a mammoth undertaking, Mr. Fischer notes.  Moreover, to
fully assess the value of the contract for any particular
product, the Debtors need to consider not just profitability of
each product on a stand-alone basis, but also its strategic
importance.

Despite the enormous scope of the job, the Debtors committed to
expeditiously renegotiating and, if necessary, rejecting all
burdensome contracts with their customers and closing
unprofitable plants.  Mr. Fischer reports that the process of
collecting information and reviewing the customer agreements
needed for the process has already begun.  A responsibly
aggressive schedule has been set for other tasks.  The review is
being conducted in four phases that categorize contracts in
descending order of priority.

The schedule calls for the Debtors to complete the various parts
of the internal analysis with respect to the agreements in
Phase 1 by July 22; to get the relevant customers the data
required for price negotiations on those agreements by July 22;
and to file any motions on to reject those agreements if
negotiations are unsuccessful by July 29.  Subsequent phases will
involve contracts believed to present less apparent targets for
involvement in declining order.  The schedule calls for motions
to be filed by rejecting contracts in Phase 2 by August 12, in
Phase 3 by August 26, and in Phase 4 by September 16.  As the
unprofitable contracts are being identified, the Debtors will
also be developing a plan to identify which plants to shut down,
and exercise that is, to a large extent, tied closely to the
resolution of the various customer agreements.

"The bottom line is that the Debtors are in the process of
reviewing the contracts and plants the Committee wants them to
address with all deliberate speed and in a manner which best
comports with the reasonable judgment," Mr. Fischer says.

Headquartered in Troy, Michigan, Collins & Aikman Corporation
-- http://www.collinsaikman.com/-- is a global leader in cockpit
modules and automotive floor and acoustic systems and is a leading
supplier of instrument panels, automotive fabric, plastic-based
trim, and convertible top systems.  The Company has a workforce of
approximately 23,000 and a network of more than 100 technical
centers, sales offices and manufacturing sites in 17 countries
throughout the world.  The Company and its debtor-affiliates filed
for chapter 11 protection on May 17, 2005 (Bankr. E.D. Mich. Case
No. 05-55927).  When the Debtors filed for protection from their
creditors, they listed $3,196,700,000 in total assets and
$2,856,600,000 in total debts. (Collins & Aikman Bankruptcy News,
Issue No. 7; Bankruptcy Creditors' Service, Inc., 215/945-7000)


COLLINS & AIKMAN: Mexican Unit Inks Waiver Agreement for Facility
-----------------------------------------------------------------
Jay B. Knoll, vice president and general counsel for Collins &
Aikman Corporation, disclosed in a regulatory filing with the
Securities and Exchange Committee that on July 8, 2005, a Mexican
affiliate of Collins & Aikman -- Collins & Aikman Automotive
Hermosillo, S.A. de C.V., as construction agent -- obtained a
waiver under a Construction Agency Agreement with a Mexican
affiliate of General Electric Capital Corporation -- GE Capital de
Mexico, S. de R.L. de C.V., as owner -- relating to the company's
new facility in Hermosillo, Mexico.

The waiver applies to, among other things, certain defaults under
the Construction Agency Agreement that have occurred and will
continue to occur as a result of the bankruptcy filing and
customer financing.

A full-text copy of the Agreement is available for free at

              http://researcharchives.com/t/s?7e

Headquartered in Troy, Michigan, Collins & Aikman Corporation
-- http://www.collinsaikman.com/-- is a global leader in cockpit
modules and automotive floor and acoustic systems and is a leading
supplier of instrument panels, automotive fabric, plastic-based
trim, and convertible top systems.  The Company has a workforce of
approximately 23,000 and a network of more than 100 technical
centers, sales offices and manufacturing sites in 17 countries
throughout the world.  The Company and its debtor-affiliates filed
for chapter 11 protection on May 17, 2005 (Bankr. E.D. Mich. Case
No. 05-55927).  When the Debtors filed for protection from their
creditors, they listed $3,196,700,000 in total assets and
$2,856,600,000 in total debts. (Collins & Aikman Bankruptcy News,
Issue No. 8; Bankruptcy Creditors' Service, Inc., 215/945-7000)


COLLINS & AIKMAN: Visteon Wants to Set Off Prepetition Debt
-----------------------------------------------------------
Visteon Corporation asks the U.S. Bankruptcy Court for the Eastern
District of Michigan to lift the automatic stay to set off its
mutual prepetition debt with Collins & Aikman Corporation and its
debtor-affiliates.

Michael C. Hammer, Esq., at Dickinson Wright PLLC, in Ann Arbor,
Michigan, relates that the Debtors purchase certain component
parts from Visteon Corporation pursuant to certain purchase
orders.

Prior to the Petition Date, Visteon provided component parts to
the Debtors for which it remains unpaid.  The Debtors owe Visteon
$2,217,171.  The Debtors also provided component parts to Visteon
for which they remain unpaid.  The amount owing from Visteon total
$43,667.

Accordingly, Visteon asks the Court to lift the automatic stay to
set off its mutual prepetition debt with the Debtors.

Headquartered in Troy, Michigan, Collins & Aikman Corporation --
http://www.collinsaikman.com/-- is a global leader in cockpit
modules and automotive floor and acoustic systems and is a leading
supplier of instrument panels, automotive fabric, plastic-based
trim, and convertible top systems.  The Company has a workforce of
approximately 23,000 and a network of more than 100 technical
centers, sales offices and manufacturing sites in 17 countries
throughout the world.  The Company and its debtor-affiliates filed
for chapter 11 protection on May 17, 2005 (Bankr. E.D. Mich. Case
No. 05-55927).  When the Debtors filed for protection from their
creditors, they listed $3,196,700,000 in total assets and
$2,856,600,000 in total debts. (Collins & Aikman Bankruptcy News,
Issue No. 7; Bankruptcy Creditors' Service, Inc., 215/945-7000)


COTT CORPORATION: Reports Second Quarter Operating Results
----------------------------------------------------------
Cott Corporation (NYSE:COT; TSX:BCB) reported results for the
second quarter ended July 2, 2005.

Sales continued to grow, up 6.3% in the quarter to $492.7 million
compared to $463.7 million in the second quarter last year.  Each
of the Company's divisions reported sales growth in the quarter
and in the first half of the year, despite an increasingly
competitive environment in all markets.  Excluding the impact of
acquisitions and foreign exchange, second quarter sales were up
3.5%.  Earnings per diluted share were $0.35, compared with $0.41
in the second quarter last year.

"Sales continued to grow this quarter despite an environment of
general category softness and aggressive national brand
promotions," said John K. Sheppard, Cott's president and chief
executive officer.  "Building upon the significant sales gains in
the second quarter last year, these results demonstrate the
ongoing commitment of our customers to their retailer brand soft
drink programs."

                         Second Quarter

Sales in the Company's U.S. business unit were up 4.1%, up 2.4%
excluding the impact of acquisitions.  In the U.K./Europe
division, sales rose 12.0%, 9.2% excluding foreign exchange. In
Canada, sales were up 8.7% as compared to the previous year, down
0.5% excluding foreign exchange.  Sales for the International
division were up 24.2% to $20.0 million, of which sales in Mexico
amounted to $14.6 million.

Gross margin for the quarter was 16.4% as compared to 18.4% in the
second quarter of last year.  The year-over-year margin decline
reflects the higher fixed costs related to the Company's capacity
action plan, including the start-up of the Texas plant, and
changes in product mix toward lower margin water, particularly in
the U.S.  A benefit of $4.9 million relating to the settlement of
a lawsuit against suppliers of high fructose corn syrup was
recorded in cost of sales.  Operating income of $45.2 million was
down 12.9% from last year's $51.9 million.

During the quarter, Cott announced that its new production
facility in Fort Worth, Texas had begun shipping to customers on
schedule.  With two of its three lines now operating and the third
scheduled to begin later in the summer, the Company expects to
produce six million cases from the facility in 2005, and over time
expects to grow to a full annual capacity of 40 million cases.

                         First Half 2005

Sales in the first six months were $888.2 million, up 6.4% versus
prior year, an increase of 5.1% excluding the impact of foreign
exchange and up 3.4% excluding both foreign exchange and
acquisitions.  The U.S. division saw sales grow by 5.7%, 3.6%
excluding acquisitions. In the U.K./Europe division, sales were up
7.5% for the first half, up 4.7% excluding the impact of foreign
exchange, while in Canada sales rose by 6.4%, down 1.9% excluding
foreign exchange.  Sales in the International division were
up 15.9% to $35.7 million of which sales in Mexico were
$25.1 million, representing a 32.8% top-line growth in Cott's
newest market in the first half of the year.

Gross margin for the first half of the year was 15.4%, including
the benefit of the high fructose corn syrup settlement, compared
to 18.7% last year.  Operating income was $64.5 million, down
22.8% from last year.

"Earnings for the first half of the year reflect the impact of
increased ingredient and packaging costs and the timing of pricing
passed through to our customers," added Mr. Sheppard.  "These
factors are being offset by increased plant efficiencies.  As
we've said before, we expect that our back-to-basics plan will
deliver a positive impact in the second half of the year."

                          2005 Outlook

In light of continuing category softness and the shift to lower
margin water, Cott is revising its full year guidance.  Sales
growth for the year is now expected to be between 6% and 8% (down
from previous guidance of between 8-10%).  EBITDA is now expected
to be between $209 million and $214 million (down from previous
guidance of between $220 million and $230 million).  Earnings per
diluted share are now expected to be between $1.06 and $1.11 (down
from $1.14 to $1.18). Capital expenditures for the year are
projected to be $95 million.

Cott Corporation is the world's largest retailer brand soft drink
supplier, with the leading take home carbonated soft drink market
shares in this segment in its core markets of the United States,
Canada and the United Kingdom.

                         *     *     *

As reported in the Troubled Company Reporter on Sept. 2, 2004,
Standard & Poor's Rating Services revised its outlook for Cott
Corp. to positive from stable.  At the same time, Standard &
Poor's affirmed its 'BB' long-term corporate credit and 'B+'
subordinated debt ratings on Toronto, Ontario-based Cott Corp.

Total debt outstanding was about US$362 million at July 3, 2004.


D&G INVESTMENTS: Case Summary & 2 Largest Unsecured Creditors
-------------------------------------------------------------
Debtor: D & G Investments of West Florida, Inc.
        8489 Merrimoor Boulevard
        Seminole, Florida 33777

Bankruptcy Case No.: 05-14434

Chapter 11 Petition Date: July 20, 2005

Court: Middle District of Florida (Tampa)

Debtor's Counsel: Thomas C. Little, Esq.
                  Thomas C. Little, PA
                  2123 Northeast Coachman Road, Suite A
                  Clearwater, Florida 33765
                  Tel: (727) 443-5773

Estimated Assets: $10 Million to $50 Million

Estimated Debts:  $1 Million to $10 Million

Debtor's 2 Largest Unsecured Creditors:

   Entity                                      Claim Amount
   ------                                      ------------
   Benefield, J.C.                               $4,900,000
   c/o S. Keith McKinney, Jr.
   P.O. Box 66714
   Saint Petersburg, FL 33706

   Berger, Todd                                      $5,000
   Elliott Berger, P.A.
   810 63rd Avenue North
   Saint Petersburg, FL 33702


D & K STORES: Lucky Dollar Buys Inventory for $4,500 per Truckload
------------------------------------------------------------------
The Honorable Kathryn C. Ferguson of the U.S. Bankruptcy Court for
the District of New Jersey approved D & K Stores, Inc.'s bulk
inventory sale to Lucky Dollar Stores, Inc., for $4,500 per
truckload free and clear of all liens, claims and encumbrances.

Timothy P. Neumann, Esq., at Broege, Neumann, Fischer & Shaver,
LLC, at Manasquan, New Jersey, tells the Court that the Debtor
believes that the value of its remaining inventory is $45,000 if
sold at retail.

The remaining inventory is difficult to sell.  If the Debtors will
remain in operation and attempt to sell those inventory, then they
will yield a net loss.

The remaining inventory is now consolidated in six locations:

   a) Store #1 826 State Street, Erie, PA
   b) Store #58 Airport Plaza, 4210 Union Road, Buffalo, NY
   c) Store #59 2184 Seneca Street, Buffalo, NY
   d) Store #60 908 West Erie Plaza, Erie, PA
   e) Store #80 Midtown Plaza, 1848 Snow Road, Para, OH
   f) Store #765 777 Roosevelt Avenue, Carteret, NJ

Luck Dollar has agreed to pay the Debtor $4,500 per truckload.
Lucky Dollar will:

   -- hand-pack the inventory at its own expense;

   -- pay all freight and shipping expenses; and

   -- wire transfer the funds to the Debtor upon delivery of the
      inventory.

The Debtor estimates that there will be a minimum of five
truckloads, which translates into a minimum sale price of $22,250.

Headquartered in Eatontown, New Jersey, D & K Stores, Inc., filed
for chapter 11 protection on April 8, 2005 (Bankr. D.N.J. Case No.
05-21445).  Timothy P. Neumann, Esq., at Broege, Neumann, Fischer
& Shaver, LLC, represents the Debtor.  When the Debtor filed for
protection from its creditors, it estimated assets and debts from
$10 million to $50 million.


DELTA AIR: Appoints Bastian as CFO After Palumbo's Resignation
--------------------------------------------------------------
Delta Air Lines (NYSE: DAL) reported the resignation of its Chief
Financial Officer Michael J. Palumbo, who recently expressed a
desire to pursue other opportunities and asked the company to
consider when it might be appropriate to make a transition.

Edward H. Bastian, a six-year Delta veteran, returned to the
company to replace Mr. Palumbo and to sit as Executive Vice
President, effective immediately.  Mr. Bastian was Chief Financial
Officer at Acuity Brands, Inc., following his most recent service
to Delta as Senior Vice President Finance and Controller.

"Michael provided strong leadership for our company and we are
extremely grateful for his contributions, said CEO Jerry
Grinstein.  We are fortunate to have Ed back in the senior
financial role, given his track record of strategic leadership at
Delta.  His expertise and detailed knowledge of Deltas finances
and strategy will ensure consistency and a smooth transition."

Delta Air Lines -- http://delta.com/-- is the world's second-
largest airline in terms of passengers carried and the leading
U.S. carrier across the Atlantic, offering daily flights to 490
destinations in 85 countries on Delta, Song, Delta Shuttle, the
Delta Connection carriers and its worldwide partners.  Delta's
marketing alliances allow customers to earn and redeem frequent
flier miles on more than 14,000 flights offered by SkyTeam and
other partners.  Delta is a founding member of SkyTeam, a global
airline alliance that provides customers with extensive worldwide
destinations, flights and services.

At March 31, 2005, Delta Air's balance sheet showed a $6.6 billion
stockholders' deficit, compared to a $5.8 billion deficit at
Dec. 31, 2004.

                         *     *     *

As reported in the Troubled Company Reporter on June 29, 2005,
Moody's Investors Service commented that the recent amendments to
the liquidity facilities that provide credit support to the Series
2000-1 (Class A-1, A-2, B and C) and Series 2002-1 (Class G-1, G-2
and C) Enhanced Equipment Trust Certificates of Delta Air Lines,
Inc. would not affect the current ratings assigned to these
Certificates:

     Series 2000-1:

        * Ba1 for Class A-1 and A-2;
        * B3 for Class B; and
        * Caa2 for Class C;

     Series 2002-1:

        * Aaa for Class G-1 and G-2; and
        * B3 for Class C.

The Aaa ratings for the Series 2002-1 Class G-1 and G-2 is based
upon the financial guaranty insurance policy issued by MBIA
Insurance Corporation to support the timely payment of interest
when due and the ultimate payment of principal on the Class G
Certificates.


DELTA AIR: Discloses Executive Changes to Realign Leadership
------------------------------------------------------------
Delta Air Lines (NYSE: DAL) CEO Jerry Grinstein disclosed
executive changes designed to realign and strengthen the company's
leadership team as Delta continues to execute its transformation
plan and intensify its efforts to improve its financial and
operational performance in the face of spiking fuel costs and
other external forces.

"Thanks to the hard work and sacrifice of everyone at Delta, our
airline has made significant progress since the launch of our
transformation plan last year," Mr. Grinstein said.  "Persistently
high fuel prices and increased competitive pressures have added
new urgency to our efforts.  Today our airline must be prepared
not only to deliver more, but to deliver it more quickly."

To ensure the executive team is organized for maximum
effectiveness and delivery on the company's strategic goals, Mr.
Grinstein announced these changes:

   -- Jim Whitehurst, currently Senior Vice President and Chief
      Network and Planning Officer, is promoted to Chief Operating
      Officer.  He will assume oversight for Operations, Customer
      Service, Network and Revenue Management and Corporate
      Strategy.  In his new role, Whitehurst will help provide the
      fast, seamless coordination between strategy and execution
      that will be essential in the critical period ahead.

   -- Joe Kolshak, currently Senior Vice President and Chief of
      Operations, is promoted to Executive Vice President and
      Chief of Operations, with new responsibilities for
      Government Affairs.

   -- Lee Macenczak, currently Senior Vice President and Chief of
      Customer Service, is promoted to Executive Vice President
      and Chief of Customer Service, with added responsibilities
      for Public Affairs.

   -- Paul Matsen, currently Senior Vice President and Chief
      Marketing Officer, is promoted to Executive Vice President
      and Chief Marketing Officer, with new responsibilities for
      Delta Technology and Corporate Communications.

Glen W. Hauenstein, a 20-year veteran of the airline industry, is
also joining Delta as Executive Vice President and Chief of
Network and Revenue Management beginning August 1. Hauenstein was
most recently Vice General Director for Alitalia, serving in the
dual role of Chief Commercial Officer as well as Chief Operating
Officer.

These changes further strengthen an already battle-tested
leadership team whose members have proven their ability to develop
and execute an aggressive, innovative strategy in the most
challenging of times, said Mr. Grinstein.

Delta Air Lines -- http://delta.com/-- is the world's second-
largest airline in terms of passengers carried and the leading
U.S. carrier across the Atlantic, offering daily flights to 490
destinations in 85 countries on Delta, Song, Delta Shuttle, the
Delta Connection carriers and its worldwide partners.  Delta's
marketing alliances allow customers to earn and redeem frequent
flier miles on more than 14,000 flights offered by SkyTeam and
other partners.  Delta is a founding member of SkyTeam, a global
airline alliance that provides customers with extensive worldwide
destinations, flights and services.

At March 31, 2005, Delta Air's balance sheet showed a $6.6 billion
stockholders' deficit, compared to a $5.8 billion deficit at
Dec. 31, 2004.

                         *     *     *

As reported in the Troubled Company Reporter on June 29, 2005,
Moody's Investors Service commented that the recent amendments to
the liquidity facilities that provide credit support to the Series
2000-1 (Class A-1, A-2, B and C) and Series 2002-1 (Class G-1, G-2
and C) Enhanced Equipment Trust Certificates of Delta Air Lines,
Inc. would not affect the current ratings assigned to these
Certificates:

     Series 2000-1:

        * Ba1 for Class A-1 and A-2;
        * B3 for Class B; and
        * Caa2 for Class C;

     Series 2002-1:

        * Aaa for Class G-1 and G-2; and
        * B3 for Class C.

The Aaa ratings for the Series 2002-1 Class G-1 and G-2 is based
upon the financial guaranty insurance policy issued by MBIA
Insurance Corporation to support the timely payment of interest
when due and the ultimate payment of principal on the Class G
Certificates.


DICKIE WALKER: Amends Acquisition Pact with Intelligent Energy
--------------------------------------------------------------
Dickie Walker Marine, Inc. (Nasdaq: DWMA) and Intelligent Energy
Holdings Plc amended the acquisition agreement, dated Feb. 3,
2005, pursuant to which Dickie Walker has proposed an offer for
the entire share capital of Intelligent Energy.  Intelligent
Energy disclosed that it has earmarked the additional funds for
use as working capital as it advances the commercialization of its
fuel cell technologies.  Intelligent Energy intends to immediately
pursue a listing on AIM, a market of the London Stock Exchange.

In the original acquisition agreement, Dickie Walker agreed that
to the extent Intelligent Energy engages in any financing
transaction or strategic acquisition prior to or concurrent with
the closing of the proposed transaction with Dickie Walker, the
stockholders of both Intelligent Energy and Dickie Walker would
share in any resulting dilution proportionately.  The potential
need for additional financing on the part of either party prior to
closing of the reverse acquisition transaction, their intent to
proportionately share any resulting dilution and the possibility
of a change to the exchange ratio were contemplated in the initial
announcement of the merger agreement on Feb. 3, 2005.  In support
of the imminent receipt of additional financing by Intelligent
Energy, the parties now have amended the acquisition agreement to
more clearly reflect the original intent to share in the dilution
proportionally and have also adjusted the exchange ratio for the
proposed offer, in order to maintain the valuation structure
agreed upon at the time the parties executed the original
acquisition agreement.

Dickie Walker explicitly endorses the equity financing as
necessary for the eventual completion of the reverse takeover of
Intelligent Energy by Dickie Walker, and has consented to the
equity financing in accordance with Rule 21 of the City Code on
Takeovers and Mergers.

Under the amended acquisition agreement, full acceptance of the
proposed Dickie Walker offer for the ordinary shares, options and
warrants held by Intelligent Energy securities holders, if made,
would result in the issuance of up to 18,698,433 new shares of
Dickie Walker common stock.  Under these amended terms, each
Intelligent Energy shareholder would receive 0.229 shares of
Dickie Walker common stock for each Intelligent Energy ordinary
share held.  The proposed treatment of Intelligent Energy options
and warrants remains unchanged from that set forth in the form S-4
filed with the U.S. Securities and Exchange Commission on May 10,
2005, other than the use of the new exchange ratio in calculating
the value and exercise price of such securities.  As noted in all
prior announcements, existing Dickie Walker options and warrants
will remain outstanding following the close of the proposed offer.

Intelligent Energy's Rule 3 adviser, ARC Associates, has reviewed
the amendment to the acquisition agreement, including the new
exchange ratio.  ARC Associates has found that the amended terms
are consistent with the intent of both Intelligent Energy and
Dickie Walker pursuant to the terms of the Acquisition Agreement,
and that both parties do in fact proportionately share the
dilution created by the financing between the parties.  As such,
ARC Associates and the Board of Intelligent Energy confirm that
the amendment to the proposed share exchange ratio falls within
the circumstances specified in the announcement made by
Intelligent Energy and Dickie Walker on Feb. 4, 2005, as being
circumstances in which the share exchange ratio may be varied.  As
a result, ARC Associates has deemed that the resulting transaction
is fair and reasonable.

Intelligent Energy -- http://www.intelligent-energy.com/-- is an
energy solutions group with a proprietary suite of new energy
technologies, and is focused on commercializing energy services in
hydrogen generation, fuel storage and power generation using
proton exchange membrane (PEM) fuel cell technology. Intelligent
Energy's products and technologies provide solutions for global
applications in the motive, distributed energy, defense and
portable markets.

Dickie Walker Marine, Inc. -- http://www.dickiewalker.com/--
designs, sources and has manufactured, markets and distributes
authentic lines of nautically-inspired apparel, gifts and
decorative items.  The Dickie Walker brand is a lifestyle brand of
nautically inspired apparel and accessories for the home, office
and boat, which are distributed through specialty retailers, yacht
clubs, resorts, higher-end sporting goods stores, marinas, coastal
stores, catalogs and a branded website.

                      Going Concern Doubt

Ernst & Young LLP expressed substantial doubt about Dickie
Walker's ability to continue as a going concern after it audited
the Company's financial statements for the year ended Sept. 30,
2004.  The auditors cite the Company's recurring operating losses
and accumulated deficit.


DICKIE WALKER: Intelligent Energy Secures $14MM Equity Financing
----------------------------------------------------------------
Dickie Walker Marine, Inc. (Nasdaq: DWMA) disclosed that
Intelligent Energy Holdings Plc has secured up to GBP8 million
(approximately $14 million) in additional equity financing from
Evolution Placements Corporation.  The financing will be raised in
two stages:

   -- GBP2.56 million (approximately $4.5 million) immediately;
      and

   -- GBP5.44 million (approximately $9.5 million) thereafter.

Evolution Placements is a British Virgin Islands company which
invests in potential high growth ventures in the innovation and
technology sectors.

"The recently announced proposed transaction between Intelligent
Energy and Dickie Walker Marine contemplated Intelligent Energy
successfully securing additional funding prior to the transaction
closing.  We have worked diligently to arrange this financing and
are gratified to have a new investor who sees the growth potential
in Intelligent Energy and the many benefits we believe exist as a
combined entity with Dickie Walker," said Dr. Harry Bradbury,
chief executive officer of Intelligent Energy.  "Additionally,
certain current Intelligent Energy shareholders enjoy standing
rights to participate in such third-party financings on the same
terms, and we will be contacting them to ask if they wish to take
up their rights."

                     Terms of the Financing

Intelligent Energy is expected to complete the financing in two
stages.  The initial investment has been funded at a price of
GBP0.80 per ordinary share for an aggregate sum of GBP2,560,000
(approximately $4.5 million), resulting in the issuance of
3,200,000 new Intelligent Energy ordinary shares.  The second
transaction will also be priced at 0.80 pounds Sterling per
ordinary share for a sum of GBP5,440,000 (approximately
$9.5 million), resulting in the issuance of 6,800,000 new
Intelligent Energy ordinary shares and, in addition to customary
conditions to closing, is conditional upon a successful AIM
listing.  Pursuant to the new investment, Evolution will have the
right to appoint two new members to the company's Board of
Directors, and will be granted options over up to 10 million
shares upon admission to AIM at an exercise price of GBP0.80 per
share.

Intelligent Energy also disclosed that further funds of up to
GBP5.76 million ($10.0 million) would be raised if the other
shareholders who have participation rights were to take up these
rights.  Up to 7,200,000 shares in Intelligent Energy would be
issued in respect of such rights.

Intelligent Energy -- http://www.intelligent-energy.com/-- is an
energy solutions group with a proprietary suite of new energy
technologies, and is focused on commercializing energy services in
hydrogen generation, fuel storage and power generation using
proton exchange membrane (PEM) fuel cell technology. Intelligent
Energy's products and technologies provide solutions for global
applications in the motive, distributed energy, defense and
portable markets.

Dickie Walker Marine, Inc. -- http://www.dickiewalker.com/--
designs, sources and has manufactured, markets and distributes
authentic lines of nautically-inspired apparel, gifts and
decorative items.  The Dickie Walker brand is a lifestyle brand of
nautically inspired apparel and accessories for the home, office
and boat, which are distributed through specialty retailers, yacht
clubs, resorts, higher-end sporting goods stores, marinas, coastal
stores, catalogs and a branded website.

                      Going Concern Doubt

Ernst & Young LLP expressed substantial doubt about Dickie
Walker's ability to continue as a going concern after it audited
the Company's financial statements for the year ended Sept. 30,
2004.  The auditors cite the Company's recurring operating losses
and accumulated deficit.


FEDERAL-MOGUL: Asbestos PD Panel's Closing Arguments in Estimation
------------------------------------------------------------------
The Official Committee of Property Damage Claimants appointed in
Federal-Mogul Corporation and its debtor-affiliates' chapter 11
cases presented its closing arguments relating to the estimation
of Federal-Mogul's liability on account of personal injury claims.
The Official Committee of Asbestos Property Damage Claimants is
represented by Michael P. Kessler, Esq., Adam P. Strochak, Esq.,
Peter M. Friedman, Esq., and Kristin King Brown, Esq., at Weil,
Gotshal & Manges LLP, as lead counsel; and Theodore J. Tacconelli,
Esq., at Ferry, Joseph & Pearce, P.A., as local counsel.

"We've demonstrated that Dr. Cantor's estimate of [Turner &
Newall's] U.S. asbestos liabilities at $2.5 billion is square in
the middle of a range of reasonable estimates provided by a
variety of different constituencies in this matter," Mr. Strochak
said.

He noted that Dr. Cantor's estimate is built on conservative
assumptions, rigorous analysis of both qualitative and
qualitative factors.

Mr. Strochak reminded Judge Rodriguez that the PD Committee filed
a motion to re-open the evidence and discovery to examine a
decision handed down by Judge Janis Graham Jack of the United
States District Court for the Southern District of Texas in a
Silica Multidistrict Litigation.  Mr. Strochak asked Judge
Rodriguez to consider the issues in the silicosis case.

"The critical point that needs to be taken here is that this
Court should not go and estimate billions of dollars in asbestos
claims without taking a very hard look at exactly what the
practices of the doctors who diagnose claimants against T&N were.
And that's an opportunity that we have not had in this matter due
to the lack of a bar date and the Asbestos Personal Injury
Claimants' own position that what we were going to do in this
case is look at the history that all these issues associated with
doctors who maybe less credible than others are all factored into
the claim values that are reflected in the historic database,"
Mr. Strochak asserted.

Mr. Strochak explained that there were a handful of findings made
that the asbestos screenings, much like the silicosis screenings
as Judge Jack found, were part of a system where massive numbers
of claims were generated so that the defendants were effectively
overwhelmed in their ability to deal with them on an individual
basis and figure out who has a disease and who doesn't have a
disease that may be compensable.

"What has happened in this case is, as Dr. [Mark] Peterson has
projected in his, in particular, nonmalignant claim values, an
amount that's two or three times or four times what the company
was actually paying in the past.  He has created a model of an
estimate that comes up with $5 billion or more allocated to these
nonmalignant claims.  And our point, your Honor, is that if these
screening practices were examined more closely that number of
claims would come down dramatically, we think it would come down
below even where Dr. Cantor put her estimates."

"If you say $5 billion is the questioned amount, are you in a
sense not seriously attacking the 6 billion?" Judge Rodriguez
asked.

"No, your Honor."

According to Mr. Strochak, the $5 billion that he referred to is
just an approximation.  "We know from Dr. Peterson's own
testimony and his own demonstratives that 47% of the value of his
estimate is allocated to nonmalignant claims, and I've just
roughly approximated that as $5 billion out of his $11 billion
estimate.  So that we know that we are talking about $5 billion
roughly in nonmalignant value in his estimate.  We think there
are very substantial challenges to that on a variety of different
grounds, including the question of how valid were these
screenings practices that generated all these claims in the
past."

"All right.  So essentially recognizing that they're estimates,
you're seriously questioning $5 billion of his $11 billion?"
Judge Rodriguez asked.

"We're seriously questioning all of his $11 billion, your Honor."

                         Compensated Claims

Mr. Strochak noted that Dr. Cantor estimates compensated claims
as opposed to filed claims.  "Filings are plaintiff driven.
Plaintiffs decide if they're going to file a lawsuit.  Plaintiffs
get sick or they don't get sick.  Plaintiff lawyers go out and
they gather up clients and they put them together in consolidated
cases or file individual cases.  That's all plaintiff generated
behavior."

"Yes," Judge Rodriguez acknowledged, "but don't they respond to
that kind of an argument by saying if you're just going to look
at the compensated figure and project from that, that could very
well be driven by a budget rather than by legitimacy of the value
of the claims?  If that's the case, is that a true way of
estimating the value?"

Mr. Strochak believes it's an appropriate way to estimate the
value.  "It's driven by defendant conduct and plaintiff conduct."
He pointed out that budgeting, forecasting what a company's
expenditures are going to be and planning for expenditures is not
a unilateral process.

"Defendants don't stand around and say I really think I would
like to pay only $50 million this year to resolve my asbestos
liabilities.  They don't have that control.  They can't control
how many cases are going to get to trial every year, that's
conduct that's within the control of the plaintiffs and courts,
of a variety of other circumstances that are beyond the
defendant's ability to control exclusively.  So budgeting for
expenditures is not a matter of saying this is how much I want to
spend, that's all I'm going to spend, it's a matter of planning."

Mr. Strochak noted that compensated claims is a factor in the
tort system.  He clarified that compensated claims is not
equivalent to a budgeted amount.  "It may or may not be that
T&N's budget fairly accurately projected what it was going to
have to compensate in any given year.  But that's not a budget.
That's not a made up number that T&N came up with.  That's data
that actually came out of the database, those are actual
resolution of claims.  That's what T&N paid to resolve each of
those claims."

"What if there is experience that says when certain industries
and professions are confronted with litigation and litigation
seems to be on the increase, that through their counsel, they
only select a couple of counsel to try cases in a year, that
slows down the ability to get cases to trial, and what happens is
that the reservoir of cases that are not reached continue to
balloon into the future until some courts had to say you can't do
that any more, you've got to spread these cases to other lawyers
because look what you're doing, you're delaying the eventual
trial of that case.  Now, if that may be a potential, can you
always be assured that when an industry budgets an amount,
they're not influencing that amount by the way they're attempting
to resolve cases, which has nothing to do with the intensity of
the filings?" Judge Rodriguez asked.

"I do understand what you're saying," Mr. Strochak replied.  "I
think, if I understand the Court's point correctly, it's that how
much of this gap between compensated claims and filed claims
might be attributable to conduct of T&N and its counsel itself
and how much of it could be attributable to other factors such
as, you know, the massive numbers of claims that simply overwhelm
courts' abilities to try them.  I don't think there's any
evidence in the record on that, your Honor.  I think it is
probably a reasonable assumption that as a company prepares a
bankruptcy filing, it's probably conserving its cash."

According to Mr. Strochak, Dr. Peterson is forecasting that more
sick people will figure out a way to bring claims against T&N.
"So his increases are all on account of increasing disease in
society.  They're all on account of some type of plaintiff
oriented behavior, either plaintiff law firms going out and
developing client portfolios more effectively and more
efficiently, perhaps, through processes like mass screenings or
whatever else they might be able to do to find these people who
are sick.  It could be, you know, personal conduct, people for
some reason may become more willing to bring lawsuits."

"Is there anything wrong with finding legitimately sick people?"
Judge Rodriguez asked.

"Absolutely not, your Honor," Mr. Strochak stressed.

"My only point, your Honor, this is what explains his increases.
It's not explained by increased disease, it's explained by
changes in behavior.  He thinks more of these people are going to
come out and pursue claims, and, in particular, pursue claims
against T&N.  That's a critical point, because, you know, people
may have claims against lots of different defendants but his
projections are based on the idea that ever increasing
percentages of people, I shouldn't say ever increasing, the
increase of the first five years of his forecast, his forecast is
based on the idea that these increasing percentages of people who
have diseases are going to find T&N as a defendant, that's the
fundamental premise.  And my point here, where I started, your
Honor, is Dr. Cantor's estimate of compensable claims really is a
very robust estimate in terms of the number of future compensable
claims that she is forecasting."

                        Valuation of Claims

Mr. Strochak also asserted that it's not appropriate to value the
claims at a single glimpse in time where there's a long history
of reflecting a much more robust flavor for what the claims were
going to look like over time as they got resolved.

"I guess I need some mental clarification in this, though," Judge
Rodriguez said.  "To the extent that a company is in a consortium
of people and their history over time of what they've paid,
according to their budget, is $60,000.  But the litigant in that
case against the consortium, the case was valued at $100,000 and
paid $100,000 but there was contribution from others.  Now, a
party to that group steps out alone and is confronted with
$100,000, isn't that the value of the case, the same value it was
before but the payments were less because they were in a group as
opposed to what the value is now when he stands alone?  It
doesn't change the value of the case, it changes how the
contribution for payment was taking place.  Isn't that basically
what the plaintiffs are saying?"

Mr. Strochak said he doesn't think it would be correct.  "There's
no evidence in this record that T&N's settlement values went from
X to Y on account of some other defendant not being standing with
them."

"Not to be facetious but so that I can clearly understand this, a
person says he doesn't get sunburned because he's under an
umbrella, he steps out from under the umbrella and he gets
sunburned, isn't the sun shining all the time, isn't the
intensity of the sun the same?  The value of the case that was
settled through the consortium, if you just look at who paid
what, isn't that an artificial figure as against the value of the
case that they were settling?  I'm only going to pay 30%.  Is the
value of the case only my 30% figure or is it what was paid to
that litigant by the entire group if you're looking at the value
of the case?" Judge Rodriguez asked.

"I guess I don't disagree with your umbrella analogy, your
Honor," Mr. Strochak said.  "I'm not quite sure I understand the
question as it relates to the total value of the case.  I mean,
are you talking -- assuming a plaintiff sues all the defendants
that might be responsible for his or her injury and let's just
say there's ten of them, when you say the value of the case, are
you saying the aggregate value that they receive from all ten
defendants?"

"Yes."

"I don't disagree that that's the value . . . of the case at that
time, at that moment in time," Mr. Strochak replied.

"But if you're looking to establish the average value of that
type -- let's take Mesothelioma.  If you're trying to establish
the average value of that case, you would have to look at the
total number that the litigant received as opposed to one of the
industries within that consortium saying over the last ten years
I only paid X amount of money which averaged out to be $30,000 a
case because then you're limiting it to the contribution shares
as opposed to the value of the case that that group settled.  I
mean, is that part of what was happening?" Judge Rodriguez asked.

"I guess I don't disagree with you.  I guess the value that the
plaintiff receives is what he or she gets from every defendant in
the case.  Whether there are absent defendants, whether there
were -- whether they sued ten defendants but there was a bankrupt
defendant from whom they didn't get full value, those are all
things that would go into the consideration of what we would
call, characterize as the aggregate value to the plaintiff that
there might be," Mr. Strochak said.

                 Closer to Trial, Higher Settlement

Mr. Strochak also pointed out that trial-set cases generally
would have higher settlement values than cases that were settled
further in advance of trial.

"Well, wouldn't that suggest that as you get closer to trial
everybody looks at the real value of the case as opposed to what
an early settlement might be?  If you are looking at a value of a
case, isn't the court house step settlement more reflective of
what the parties believe should be paid, even though it may be
higher?" Judge Rodriguez asked.

"No, I don't, your Honor.  I think that this is a marketplace,
people assign values, parties reach agreement on values at all
stages in the litigation process.  There is a market for
settlements and you could conceivably divide that market into
different time frames and you may get different values, but I
don't think you would properly characterize a settlement on the
eve of trial or in preparation for trial as any more real value
than one that was done six months before trial, they're just done
at different times."

"No, but that's why I asked the question," Judge Rodriguez said.
"What is it about the trial that makes them pay more money, that
a jury may recognize the value beyond what they were willing to
pay before? Is that the threat?"

Mr. Strochak noted that there are a variety of different threats.
"There are defense costs associated, it's not inexpensive to try
an asbestos case and you have expert witnesses and you have your
legal team and everything else, so presumably a defendant that
knows it is going to incur a couple of hundred thousand dollars
in legal fees might be willing to pay a little bit more to avoid
that cost as opposed to someone who is settling a case at an
earlier stage when there was no eminent trial setting or anything
like that, that's certainly one factor."

Mr. Strochak continued that there are risk factors that both
parties take into account.  "Juries can be dangerous places for
defendants, we all know that.  There is a tremendous risk of
runaway jury verdicts in lots of jurisdictions, in every
jurisdiction in this country, in many jurisdictions it's much
more severe.  Of course, many asbestos cases were streamed toward
those jurisdictions where the plaintiffs felt that they would
have the most chance of a substantial jury verdict, you wouldn't
expect them to do anything different.  Defendants, of course,
tried to have them moved to forums that they felt more
comfortable in, such as the federal MDL proceeding in
Philadelphia where they had the opportunity to get federal
jurisdiction.  So, that happens all the time."

                        Nonmalignant Claims

Mr. Strochak further criticized Dr. Peterson's analysis.  Mr.
Strochak notes that Dr. Peterson assumes a countervailing
increase in the nonmalignant values, "basically saying that well,
all these Plaintiffs' lawyers who [are] diligently representing
their clients with malignant diseases, they must have been
leaving some money on the table because they were too focused on
the nonmalignant claims."

"I don't think that's a rational approach, your Honor, I don't
think it's rational to say that plaintiffs' lawyers chose not to
pursue their clients' interest and maximize the value of their
recoveries because they were more concerned with pursuing these
nonmalignant claims.  I think they're talented lawyers, I don't
think the fact that it's going to be harder to pursue
nonmalignant claims is going to result in substantial increases
in value for the malignant claims, that doesn't seem to make any
sense to me, your Honor."

"Isn't one of the difficult issues for a court to try to
determine when you are determining values, that I would assume
that the B readers that are being condemned are, according to
your discussion, are finding symptoms when symptoms don't exist,
but in those reads are these people or have they been
legitimately exposed to asbestos?" Judge Rodriguez asked.

"Some of them may have, some of them may not, Your Honor."

"Let's assume those that have, and you quarrel with the B readers
-- when I say you quarrel, the issue of B readers says well that
x-ray doesn't really say that.  Are you asking to discount all
those cases or do you have to give some consideration to the fact
that you are also dealing with a latency period?  You could be
discounting somebody that is a potential cancer patient, but this
particular x-ray may not show it, if he's had legitimate
exposure.  So don't you have to be a little careful how you
address the nonmalignant case and not just put an eraser to the
numbers?" Judge Rodriguez asked.

"I don't disagree, your Honor, I think that's -- the trick of
forecasting, of course, is we're dealing with aggregates, we're
dealing with generalities rather than specifics.  Of course, the
best way to figure out if anyone has radiographic evidence of any
kind of lung abnormality is to give them a good chest x-ray, have
it reviewed by a good doctor and to the extent there are any
disputes, have it hashed out by two doctors on cross-examination
at a trial.  That's probably the only way we could resolve that
dispute in our legal system.  Probably not a terribly good way
from a medical perspective, but that's the way our legal system
resolves them.  What we think, your Honor, is that rather than
accept the past at face value, you need to look behind, figure
out what these practices really were.  Nobody is suggesting that
there are no sick people out there, no one is suggesting that
anything other than a lot of people have been exposed to asbestos
over the years, some of them are going to get sick, but the trick
is to figure out how many of them really have some indication of
disease," Mr. Strochak explained.

                      Dr. Cantor Is Qualified!

Mr. Strochak complained that the Asbestos Claimants Committee's
filings are filled with an attack on Dr. Cantor's credibility and
her qualifications.  "It's unfounded!"

Mr. Strochak asserted that Judge Rodriguez has already found Dr.
Cantor qualified to testify as an expert in this case.  "We will
readily concede, your Honor, that she is not the regular expert
that people turn to in these cases.  We think that's a virtue,
not a vice.  She's done lots of asbestos estimation work, she's
consulting on numerous matters, she's been qualified to testify
as an expert before on a matter other than asbestos, estimation.
She is an extraordinarily well qualified forecaster, she's a
Ph.D. economist, she has experience, as she testified, working
for the Oakridge National Laboratory where she did analysis of
asbestos matters.  We think she's well qualified and really
qualified here to opine in a way that is very different from what
Dr. Peterson does."

On the other hand, Mr. Strochak noted, Dr. Peterson is a lawyer
and an advocate.  "I'm sure he believes very deeply in what he's
doing and what he's testifying to, but he's an advocate."

Mr. Strochak also addressed the issue that Dr. Cantor did not
spend an extraordinary amount of her time speaking with lawyers,
trying to learn about what lawyers felt about these matters.
"Again, virtue, not vice."

Dr. Peterson, Mr. Strochak noted, got his claim values in this
case based on consultations with the plaintiffs' lawyers who are
representing the members of the Asbestos Creditors Committee.
"He went and had conversations with the plaintiffs' lawyers and
said, you know, we're going to try to find out what the trust
distribution value should be, what do you guys think? How do you
guys think we should do it?  That's not the type of rigorous
analysis that Dr. Cantor did, it's not the type of rigorous,
independent analysis that should be the foundation for the
estimate in this case.  It's a collaborative process that he
underwent.  And I have no doubt that he learned many interesting
things from some of the plaintiffs' lawyers that he talked to.
But what you didn't hear in the testimony here, your Honor, is
you didn't hear Dr. Peterson say I spoke to this plaintiff's
lawyer on this day and he told me that he was gearing up to bring
a thousand new cases against T&N before the bankruptcy filing.
You didn't hear that level of detail.  And if they were out
there, your Honor, if the plaintiffs' lawyers are out there just
waiting to pounce on T&N based on the revelations of the Tweedale
book or the end of its ostensible obscurity within CCR or
anything else, you would think that we would have heard more
specifics about that, your Honor."

Headquartered in Southfield, Michigan, Federal-Mogul Corporation
-- http://www.federal-mogul.com/-- is one of the world's
largest automotive parts companies with worldwide revenue of
some US$6 billion.  The Company filed for chapter 11 protection
on October 1, 2001 (Bankr. Del. Case No. 01-10582).  Lawrence J.
Nyhan Esq., James F. Conlan Esq., and Kevin T. Lantry Esq., at
Sidley Austin Brown & Wood, 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 listed
US$10.15 billion in assets and US$8.86 billion in liabilities.
At Dec. 31, 2004, Federal-Mogul's balance sheet showed a
US$1.925 billion stockholders' deficit.  At Mar. 31, 2005,
Federal-Mogul's balance sheet showed a US$2.048 billion
stockholders' deficit, compared to a US$1.926 billion deficit at
Dec. 31, 2004.  Federal-Mogul Corp.'s U.K. affiliate, Turner &
Newall, is based at Dudley Hill, Bradford. (Federal-Mogul
Bankruptcy News, Issue No. 88; Bankruptcy Creditors' Service,
Inc., 215/945-7000)


FEDERAL-MOGUL: Asbestos PI Panel's Closing Arguments in Estimation
------------------------------------------------------------------
Lawyers for the Official Committee of Asbestos Personal Injury
Claimants, made their way to Judge Rodriguez's courtroom in
Camden, N.J., to present their closing arguments relating to the
estimation of Federal-Mogul's liability on account of personal
injury claims.

Elihu Inselbuch, Esq., Nathan Finch, Esq., and Danielle K.
Graham, Esq., at Caplin & Drysdale, Chartered, and Marla R.
Eskin, Esq., and Kathleen J. Campbell, Esq., at Campbell &
Levine, LLC, represent the ACC.

"This big argument between [Dr.] Peterson and [Dr.] Cantor comes
down to two issues: number of claims and value of claims," Mr.
Inselbuch stated.

Mr. Inselbuch revisited his analogy of the gasoline prices.  "You
have a gasoline price today that evolves from a number of complex
factors, it's not a simple number, it has to do with the supply
of oil around the world, the interaction politically of a number
of countries, the production prices, the shipping costs of moving
the stuff from here to there, it's a very complex equation I
wouldn't begin to understand.  But I know when I go to the gas
station, I have to pay what it says on the pump."

"If there were a new discovery of oil someplace that made oil
cheaper, or if something happened politically to make oil
cheaper, that might happen," Mr. Inselbuch continued.  "I don't
have any expertise or pretend any expertise, but that's what I
would expect an expert to be thinking about if the question
before the Court were what was the price of gasoline going to be
over the next 40 years."

"And that takes you back to asbestos," Mr. Inselbuch said.  "What
about the price of asbestos cases, the settlement price of
asbestos cases?  Well, Dr. Cantor and Mr. Strochak insist that
you should look at the longer period of time dating back to the
CCR experience and use that as the framework for what you would
project to be the prices in the future.  He said you wouldn't do
that unless there was a regime change."

Mr. Inselbuch related that there was a regime change when the CCR
ended.  "It is true that it happened not too long before Turner &
Newall and Federal-Mogul entered into Chapter 11 so there isn't a
long history of what happened thereafter, but there is still a
history.  And there is nothing, no suggestion anywhere that
what's going to happen somehow to benefit Turner & Newall or any
of these other asbestos companies is going to turn matters around
so they can settle cases for substantially less money than they
settled them for in the present."

Mr. Inselbuch told Judge Rodriguez that the idea that they
settled them for less in the past does not prove they will settle
them for less in the future.  That just doesn't follow, Mr.
Inselbuch said.  He gave the example of Stacy Evans.

Ms. Evans, according to Mr. Inselbuch, came to work with Caplin
Drysdale six years ago as a paralegal, earning $35,000 or $40,000
a year.  Ms. Evans left the firm and went to the Harvard Law
School where she earned nothing for three years.  "Now she's back
with us as an associate and I . . . tell you that we pay her well
over a hundred thousand dollars a year as a first year
associate."

"What will happen to [the] law clerk's salaries when they finish
being law clerks and they go to work for law firms?" Mr.
Inselbuch asked.

Mr. Inselbuch asked how Ms. Evans' lost wages are determined if
she gets injured.  "Would you go back and take a rolling four-
year average?  Would you focus on the three years she was 24 at
the Harvard Law School when she didn't earn anything at all?
Would you go back and insist that you have to draw a graph from
when she was a paralegal and she was making $35,000?"

"I don't think anybody would listen to that for five minutes,
your Honor," Mr. Inselbuch said.  "I think people would say no,
this is a young lawyer and she has a trajectory of earnings, a
projected trajectory of earnings based on her being a young
lawyer, not on her being a paralegal or a law student."

On the issue of values, Mr. Inselbuch asserted that he just
doesn't see any basis in picking values that are based on a
period before the regime change.  There is no logical explanation
for that, and it cannot be justified because it was not done
statistically, Mr. Inselbuch pointed out.  "That's not an answer,
it makes no sense and it has to be rejected."

On the issue of number of claims, Mr. Inselbuch explained that
one has to understand why numbers are what they are.  "With the
gasoline prices, in order to project what the gasoline price
might be ten years from now, you have to know an awful lot about
petroleum economics.  You can't just look at database and say
well, let's draw a line from some time when the gasoline per
gallon was a dollar and a half and draw a line this way and
that's what it's going to be and that is just a bubble and it's
going to come down again.  It may be that that is the right
analysis, but there has to be a basis for it in fact, in logic
and in science, and I submit to your Honor that there is no such
basis.  And the net effect of all of this is that you get a
wholly illogical projection."

"It's wholly illogical to say we're going to project how many
claims will be filed in the future based on how many we paid in
the past, even though the reason we're doing this projection is
because we're in Chapter 11 because we didn't pay our claims,"
Mr. Inselbuch argued.

Mr. Inselbuch emphasized that one can't simply have numbers of
claims that are based on some artificial construction that
ignores the reality and one can't use values that no one would
accept in the marketplace and there is no reason to accept.

Mr. Inselbuch asserted that Dr. Peterson rightly explored what
the motivating market factors are in determining where these
claims were going and why.  Mr. Inselbuch believes that Dr.
Peterson understood what the CCR was all about, and what Messrs.
Hanly and Hanlon were telling him.  "It's not about some kind of
contrived agreement among the parties as to what the projection
ought to be."

On the other hand, Mr. Inselbuch does not believe that Dr. Cantor
understood what was going on in the tort system.  "I don't think
she understood the effect the closing of the CCR had on Turner &
Newall and that the effect was permanent, that you couldn't just
say well this regime before has to be used to average in with
this regime that exists today, even though this earlier regime is
gone.  That's not statistics, that's just foolishness."

Mr. Inselbuch asserted that Dr. Peterson understood the tort
system, and the effect of the closing of CCR on T&N.  Mr.
Inselbuch believes that the Dr. Peterson's evidence is credible.
"There is nothing about his evidence that did not withstand
cross-examination, [or] the Court's questions."

Headquartered in Southfield, Michigan, Federal-Mogul Corporation
-- http://www.federal-mogul.com/-- is one of the world's
largest automotive parts companies with worldwide revenue of
some US$6 billion.  The Company filed for chapter 11 protection
on October 1, 2001 (Bankr. Del. Case No. 01-10582).  Lawrence J.
Nyhan Esq., James F. Conlan Esq., and Kevin T. Lantry Esq., at
Sidley Austin Brown & Wood, 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 listed
US$10.15 billion in assets and US$8.86 billion in liabilities.
At Dec. 31, 2004, Federal-Mogul's balance sheet showed a
US$1.925 billion stockholders' deficit.  At Mar. 31, 2005,
Federal-Mogul's balance sheet showed a US$2.048 billion
stockholders' deficit, compared to a US$1.926 billion deficit at
Dec. 31, 2004.  Federal-Mogul Corp.'s U.K. affiliate, Turner &
Newall, is based at Dudley Hill, Bradford. (Federal-Mogul
Bankruptcy News, Issue No. 88; Bankruptcy Creditors' Service,
Inc., 215/945-7000)


FEDERAL-MOGUL: Futures Rep's Closing Arguments in Estimation
------------------------------------------------------------
The Legal Representative for Future Asbestos Personal Injury
Claimants presented its closing arguments relating to the
estimation of Federal-Mogul's liability on account of personal
injury claims.  Rolin Bissell, Esq., and Maribeth L. Minella,
Esq., at Young Conaway Stargatt & Taylor, LLP, represent the
Future Claimants Representative.

Mr. Bissel told Judge Rodriguez that the Futures Representative
believes that Dr. Peterson's estimates are exactly right.

Mr. Bissel said he hopes Judge Rodriguez will appreciate that
they did try to streamline the proof by presenting one expert,
and will not draw any negative inferences from the way they have
divided presenting the proof on the plaintiffs' side of the
table.

Mr. Bissel emphasized that the future claimants are "the group
that has the greatest likelihood of getting short-changed if
[the] estimate is wrong."

"So, we have a very keen interest representing the future
claimants to make sure that the estimate is correct, that it's
done on the best evidence, that it's not done on the basis of
something that's untested, not tried, because we know, we know
from the incidence curves, we know from the Nicholson incidence
curves, which again Dr. Peterson showed us how accurate they're
turning out to be from the SEER data, from the 2000 census data,
how accurate those curves are that people are going to get sick
and people are going to die and there is a reality behind these
numbers."

"My clients, if you will, are not a curve, they're not a number,
there is nothing fanciful about them, they're not something just
to be averaged and rounded and graphed, they are people who are
really going to get sick, who are really going to die and are
entitled to compensation just as much as the people who were
compensated in the past, as the current claimants, that's what
this process is about for them, to make sure that there is a
proper estimate for them to compensate them for their injuries
and their deaths when that happens."

Mr. Bissel urged Judge Rodriguez to focus on what the fact
witnesses testified and explained how the system works.  "That's
the best forecast of how the system would work in the future.  We
believe when you do that, you are . . .  inextricably drawn to
Dr. Peterson's conclusion and it really causes you to reject Dr.
Cantor's conclusion, and that is what we ask the Court to do."

Headquartered in Southfield, Michigan, Federal-Mogul Corporation
-- http://www.federal-mogul.com/-- is one of the world's
largest automotive parts companies with worldwide revenue of
some US$6 billion.  The Company filed for chapter 11 protection
on October 1, 2001 (Bankr. Del. Case No. 01-10582).  Lawrence J.
Nyhan Esq., James F. Conlan Esq., and Kevin T. Lantry Esq., at
Sidley Austin Brown & Wood, 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 listed
US$10.15 billion in assets and US$8.86 billion in liabilities.
At Dec. 31, 2004, Federal-Mogul's balance sheet showed a
US$1.925 billion stockholders' deficit.  At Mar. 31, 2005,
Federal-Mogul's balance sheet showed a US$2.048 billion
stockholders' deficit, compared to a US$1.926 billion deficit at
Dec. 31, 2004.  Federal-Mogul Corp.'s U.K. affiliate, Turner &
Newall, is based at Dudley Hill, Bradford. (Federal-Mogul
Bankruptcy News, Issue No. 88; Bankruptcy Creditors' Service,
Inc., 215/945-7000)


FLEETWOOD ENTERPRISES: Operating Losses Prompt S&P to Cut Ratings
-----------------------------------------------------------------
Standard & Poor's Ratings Services lowered its corporate credit
rating on Fleetwood Enterprises Inc. to 'B+' from 'BB-'. The
outlook is negative.  At the same time, the rating assigned to the
company's convertible senior subordinated debentures is lowered to
'B-' from 'B'.  The rating assigned to Fleetwood Capital Trust's
convertible trust preferred securities remains 'D', as Fleetwood
continues to defer payment of related dividends.

The rating actions were prompted by significant losses from
continuing operations in fiscal year 2005 (which ended April 24,
2005).  "Specifically, operating losses within the company's
recreational vehicle group were high in the latter half of the
fiscal year and contributed to material erosion in shareholder
equity and cash reserves.  Consequently, debt protection measures
and financial flexibility both have been impaired," explained
Standard & Poor's credit analyst James Fielding. Mr. Fielding also
noted, "These actions do not indicate an adverse opinion of the
efforts by Fleetwood's new senior management team to restructure
the company and divest it of its unprofitable manufactured housing
retail group and the manufactured housing retail loan portfolio;
this strategy may ultimately improve the predictability and
stability of cash flow."

The pending sale of Fleetwood's struggling retail platform will
eliminate the operating losses from that segment, while creating
some additional near-term liquidity.  The move should also enable
the newly configured management team to channel resources into
quickly stemming the losses within the company's historically
strong RV group.  Fleetwood's ratings, however, remain highly
vulnerable to further downgrades should these efforts prove more
time-consuming or costly than expected, given the potential for
continued softening in overall RV demand as a result of
persistently high fuel prices.


FORD MOTOR: Deteriorating Profitability Prompts Fitch's Downgrade
-----------------------------------------------------------------
Fitch Ratings has downgraded the senior unsecured debt of Ford,
Ford Credit and various affiliates to 'BBB-' from 'BBB'.  Ratings
on the Capital Trust II securities have been downgraded to 'BB'
from 'BB+'.  Fitch has also affirmed the 'F2' commercial paper
ratings.  Additionally, Fitch has lowered the ratings of Hertz
have to 'BBB-' from 'BBB' and remain on Rating Watch Evolving.

The downgrade of Ford reflects the deteriorating profitability of
Ford's North American operations, most recently affected by new
pricing initiatives, higher commodity costs and supplier issues,
while the Hertz downgrade solely represents its ownership by Ford.

Along with the sharp decline in large and mid-size SUV's during
2005 and cash outflows related to restructuring activities, Fitch
expects that cash flow will remain negative through 2005 and
potentially into 2006.  The Rating Outlook remains Negative given
significant revenue pressures from industry product and price
competition, and the competitive disadvantage represented by its
cost structure. A full list of impacted ratings is attached below.

Fitch remains of the view that Ford and Ford Credit are likely to
remain investment grade through 2005, as recent product
performance and very healthy liquidity provide Ford with the time
and resources to address structural cost issues (including legacy
costs).

Stabilization of the rating will be reliant on progress Ford is
able to make in its cost structure over the near term, given the
competitive environment and the expected difficulty in
meaningfully improving revenues.  Stabilization of cash flows from
the cost side could arise from a combination of sources including:
commodity price relief, structural cost reductions from employee
attrition and buyout programs, restructuring actions at Ford
facilities and the acquired Visteon assets, a strengthening dollar
(benefiting PAG imports into the U.S.), and potential concessions
from the UAW regarding legacy costs. Ford has been vocal about its
over-capacity situation, and progress in this area will take time
and financial resources.  Ford's financial position provides
substantial capacity and liquidity with which to address its cost
position.

Fitch's previous downgrade of Ford and Ford Credit (May 19, 2005)
incorporated the expectation of modestly negative to break-even
cash flows in the automotive segment given the sharp decline in
higher-margin mid-size and large SUVs, expectations of heightened
price competition for Ford's key F-series products, commodity
pressures and heightened supplier issues.  The recent
establishment and extension of incentive programs in the industry
have created new price points, and re-emphasizes the need for
further structural cost reductions in order to stabilize margins
and cash flows.  Volume gains could reduce extended inventory
positions, but the sustainability of industry sales volumes remain
in question.  With increased incentives, domestic OEMs have become
increasingly vulnerable to volume declines that could surface in
the event of a decline in economic conditions or as the result of
sales pull-forward.

Fitch expects that Ford will show negative automotive cash flow in
2005 despite favorable GDP, steady employment growth and very
healthy industry sales volumes.  Ford also remains exposed to
pricing initiatives by transplants that have substantially larger
capacity to absorb margin contraction.  Despite the recent decline
in steel prices, meaningful relief is not expected to be realized
until 2007, although some relief should occur from declining pass-
through from suppliers who are more reliant on spot prices.
Higher warranty outlays have also impacted cash flows, and
increasing health care costs continue to be a key competitive cost
disadvantage.

Despite successful recent product introductions, an increasingly
flexible manufacturing base and several new models scheduled for
the remainder of 2005, Ford will remain challenged to improve top-
line performance.  June sales trends showed continuing positive
trends in Ford's car sales, but also showed a meaningful increase
in lower-margin fleet sales.  Ford ended the month with extended
inventories across a number of key high-margin product lines,
requiring the establishment of new price incentives, and further
raising the potential for production cutbacks.

Supplier issues remain at the forefront, exemplified by Ford's
agreement to bring Visteon's assets and liabilities back on-
balance sheet (as well as recent support provided by multiple OEM
s to Collins and Aikman).  This situation represents a reversal of
the historic trend wherein the OEMs were able to extract regular
price concessions from their supplier base.  In an environment
that requires OEMs to consistently reduce their cost structure,
OEMs will be challenged to extract savings from this source.
Increasing levels of financial support are being provided to
suppliers to ensure supply chain integrity and required investment
related to new product introductions.  Although Visteon represents
the recognition of Ford's liabilities related to Visteon's assets,
Ford's financial resources provide it with the opportunity to
accelerate the restructuring of a key, uncompetitive component of
Ford's supply chain.

European results have also declined meaningfully in 2005 due to
competitive pressures, but other geographic regions have shown
strength.  Ford's PAG unit rebounded to profitability in the
second quarter, a substantial rebound from prior year results.
The stronger-than-expected rebound at PAG has reduced what has
previously been considered a key risk factor.

Ford's balance sheet remains healthy, with substantial liquidity.
Cash and s/t VEBA at June 30, 2005 was $21.8 billion down $1.8
billion from year-end 2004. This relates to $18.1 billion in total
automotive debt.  The reduction in cash includes voluntary
pension/OPEB contributions of $2.5 billion in the first half.
Second half cash outflows are expected to accelerate due to
outlays related to restructuring of the current Visteon assets,
modest operating losses and working capital outflows associated
with decreased supplier payables and outflows related to dealer
incentive programs.  Available liquidity could be strongly
supplemented in the near term by the anticipated sale of Hertz.

Ford Credit remains a solid contributor to consolidated operating
results and supports the rating.  Dividends to Ford Motor are
expected to offset a portion of the negative cash flows from auto
operations resulting in little balance sheet deterioration.
Liquidity is expected to be strongly supplemented by proceeds from
the expected sale of Hertz.

Fitch has lowered the following ratings with a Negative Rating
Outlook:

Ford Motor Co.

     -- Senior debt to 'BBB-' from 'BBB'.

Ford Motor Credit Co.

     -- Senior debt to 'BBB-' from 'BBB'.

FCE Bank Plc

     -- Senior debt to 'BBB-' from 'BBB'.

Ford Capital B.V.

     -- Senior debt to 'BBB-' from 'BBB'.

Ford Credit Canada Ltd.

     -- Senior debt to 'BBB-' from 'BBB'.

Ford Motor Capital Trust II

     -- Preferred stock to 'BB' from 'BB+'.

Ford Holdings, Inc.

     -- Senior debt to 'BBB-' from 'BBB'.

Ford Motor Co. of Australia

     -- Senior debt to 'BBB-' from 'BBB'.

Ford Credit Australia Ltd.

     -- Senior debt to 'BBB-' from 'BBB'.

PRIMUS Financial Services (Japan)

     -- Senior debt to 'BBB-' from 'BBB'.

Ford Motor Co. S.A. de CV (Mexico)

     -- Senior debt to 'BBB-' from 'BBB'.

Ford Motor Credit Co. of New Zealand

     -- Senior debt to 'BBB-' from 'BBB'.

Ford Motor Credit Co. of Puerto Rico

     -- Senior debt to 'BBB-' from 'BBB'.

The following ratings have been downgraded and remain on Rating
Watch Evolving by Fitch:

The Hertz Corp.

     -- Senior debt to 'BBB-' from 'BBB'.

Hertz Finance Centre plc

     -- Senior debt to 'BBB-' from 'BBB'.

These short-term ratings also remain on Rating Watch Evolving:

Hertz Australia Pty. Ltd.*

    -- Commercial paper 'F2'.

Hertz Canada Ltd.*

    -- Commercial paper 'F2'.


GENERAL BINDING: New Company's Stock Registration Is Effective
--------------------------------------------------------------
Fortune Brands, Inc. (NYSE: FO) and General Binding Corporation
(NASDAQ: GBND) reported the further progress toward the completion
of the previously announced spin-off/merger that will create ACCO
Brands Corporation.

As reported on March 16, 2005, ACCO Brands is being formed through
the spin-off of Fortune Brands' ACCO World Corporation office
products unit and its merger with General Binding Corporation --
GBC.

The registration statement relating to the issuance of ACCO Brands
common stock to GBC stockholders under the previously announced
merger agreement among GBC, Fortune Brands and ACCO World was
declared effective by the Securities and Exchange Commission on
July 15, 2005.  The registration statement contains the proxy
statement/prospectus-information statement that describes the
proposed merger, merger agreement and the related issuance of ACCO
Brands common stock.  The proxy statement/prospectus-information
statement is expected to be mailed this week to GBC stockholders
of record entitled to vote on the transaction.

The companies further reported that GBC will hold a special
meeting of its stockholders on August 15, 2005, at 10:30 a.m.,
local time, at GBC's headquarters in Northbrook, Illinois, to vote
on this proposed merger.  GBC stockholders of record as of June
23, 2005 will be entitled to vote at the special meeting. GBC's
majority stockholder, Lane Industries, Inc., has agreed to vote
for the merger.

In addition to the approval of GBC's stockholders, the merger is
subject to certain other conditions that are described in the
proxy statement/prospectus-information statement, including
receipt of required non-U.S. competition authority approvals.  As
previously announced on May 18, the waiting period for the U.S.
Federal Trade Commission to review the transaction, required under
the Hart-Scott-Rodino Antitrust Improvements Act, has expired.
The transaction is expected to close shortly following the GBC
stockholder meeting.

ACCO Brands will be a leading supplier of branded office products
with nearly $2 billion in annual revenue and a global footprint.
Its portfolio of industry-leading brands will include Swingline,
Kensington, Wilson Jones, Quartet, GBC and Day-Timer, among
others. With increased scale and international reach, ACCO Brands
will be well positioned to capitalize on growth opportunities in
the global office products market.  It is expected that ACCO
Brands' common stock will be listed on the New York Stock Exchange
under the symbol ABD.

                      About Fortune Brands

Fortune Brands, Inc. is a $7 billion leading consumer brands
company.  Its operating companies have premier brands and leading
market positions in home and hardware products, spirits and wine,
golf equipment and office products.  Home and hardware brands
include Moen faucets, Aristokraft, Schrock, Diamond and Omega
cabinets, Therma-Tru door systems, Master Lock padlocks and
Waterloo tool storage sold by units of Fortune Brands Home &
Hardware, Inc.  Major spirits and wine brands sold by units of Jim
Beam Brands Worldwide, Inc., include Jim Beam and Knob Creek
bourbons, DeKuyper cordials, The Dalmore single malt Scotch, Vox
vodka and Geyser Peak and Wild Horse wines.  Acushnet Company's
golf brands include Titleist, Cobra and FootJoy. Office brands
include Swingline, Wilson Jones, Kensington and Day-Timer sold by
units of ACCO World Corporation.  Fortune Brands, headquartered in
Lincolnshire, Illinois, is traded on the New York Stock Exchange
under the ticker symbol FO and is included in S&P 500 Index and
the MSCI World Index.

                        About ACCO World

The ACCO World Corporation unit of Fortune Brands is a world
leader in branded office products.  With leading brands including
Swingline, Wilson Jones, Kensington, Day-Timer, Boone, Apollo and
Rexel, the company's innovative products help people work more
efficiently, more comfortably and more productively than ever
before. ACCO's annual sales exceed $1.1 billion.  The company is
headquartered in Lincolnshire, Illinois.

                      About General Binding

General Binding Corporation is a world leader in products that
bind, laminate, and display information enabling people to
accomplish more at work, school and home.  GBC's products are
marketed in over 100 countries under the GBC, Quartet, and Ibico
brands.  These products are designed to help people enhance
printed materials and organize and communicate ideas.  The company
is headquartered in Northbrook, Illinois.

                         *     *     *

As reported in the Troubled Company Reporter on April 1, 2005,
Standard & Poor's Ratings Services affirmed its ratings on General
Binding Corp., including its 'B+' corporate credit rating.

At the same time, Standard & Poor's removed the ratings from
CreditWatch, where they had been placed on March 16, 2005.  The
outlook is stable.

As reported in the Troubled Company Reporter on March 29, 2005,
Moody's Investors Service affirmed the ratings of General Binding
Corporation and changed the outlook from positive to stable.  The
affirmation of General Binding's credit ratings reflects stable
operating and financial performance despite challenging conditions
in the office products industry.  Although operating margins have
weakened in 2004, the company has been able to offset much of the
pressure from rising raw material costs and a difficult pricing
environment with improvements in the company's cost structure.

The change in ratings outlook from positive to stable reflects
weaker than expected financial performance by the company and
reduced expectations for future growth.  The stable outlook
reflects Moody's expectation of minimal sales growth, flat
operating margins and the continued use of free cash flows to
reduce leverage.


GENERAL MOTORS: Posts $286 Million Net Loss in Second Quarter
-------------------------------------------------------------
General Motors Corp. (NYSE: GM) reported a $286 million net loss
for the three-month period ended June 30, 2005, including special
items.  The special items include a $126-million restructuring
charge at GM Europe, and recognition of the recurring tax benefits
above those reflected in the 15-percent rate used in GM's adjusted
earnings. These items had a net favorable effect of $32 million.

The Company reported a loss of $318 million, in the second quarter
of 2005, excluding special items and a tax-rate adjustment.  These
results compare with net income of $1.4 billion in the second
quarter of 2004.  Revenue was $48.5 billion, compared with
$49.3 billion a year ago.

"Our second-quarter results reflect a mix of some important pluses
and minuses," GM Chairman and Chief Executive Officer Rick Wagoner
said.  "On the positive side, sales were up in all regions and
global market share increased as our new cars and trucks continued
to gain traction and show strong customer acceptance.  In
addition, financial results were positive in four of our operating
units, with GMAC and GM Latin America/Africa/Mid-East continuing
their recent favorable performance and GM Europe and GM Asia
Pacific showing significant improvement from the first quarter.

"But, importantly, on the minus side, GM North America's financial
performance continued to be very disappointing.  While the results
reflect a significant reduction in U.S. dealer inventory, with
second-quarter inventories down 349,000 units from mid-year 2004
and 224,000 units from the first quarter of 2005, they also re-
emphasize the need for us to significantly improve our cost
structure in all major areas -- material costs, productivity,
capacity utilization and especially health care."

GM financial results described throughout the remainder of this
release exclude special items unless otherwise noted.

                    GM Automotive Operations

GM's global-automotive operations reported a loss of $948 million
in the second quarter of 2005, as profitable results in Europe,
Asia and the Latin American/Mid-East region were more than offset
by losses in North America.  GM's global-automotive operations
earned $579 million in the prior-year period. GM's global market
share rose to 15.2 percent in the second quarter of 2005, compared
with 14.7 percent in the year-ago period, and worldwide deliveries
were up more than 10 percent.

GM North America reported a loss of $1.2 billion in the second
quarter of 2005, compared with earnings of $355 million in the
second quarter of 2004.  GM's market share in North America rose
to 27.3 percent in the second quarter of 2005, up from 26.2
percent in the year-ago quarter.

GMNA's second-quarter 2005 results were adversely affected by
lower production volumes -- down 142,000 units from the year-ago
quarter, a less favorable product mix and increased health-care
costs.  Sales were up as a result of improved acceptance of new
products and highly successful marketing programs.  The
combination of lower production and stronger sales helped to
significantly reduce U.S. dealer inventories during the quarter to
just over 1 million vehicles.

"The inventory reduction in the second quarter is a real
positive," Mr. Wagoner said.  "That, plus the strong sales of our
new products like the Chevrolet Cobalt and the Hummer H3 and the
favorable results of the recent J.D. Power Initial Quality and
Vehicle Dependability reports, are indicators that our intense
focus on product excellence is paying dividends.  We also continue
to progress in the re-tooling of our sales and marketing strategy,
including the successful value-based consumer marketing program in
June.

"Where we are not yet making the progress we need is on the cost
side of the business.  With the intense competitive conditions and
pricing pressures continuing in the North American market, it's
clear that we need to move faster in implementing the key cost
reduction strategies that I outlined at our recent Annual Meeting
-- re-energizing our global sourcing efforts, improving U.S.
capacity utilization and achieving fully competitive productivity
levels," Wagoner said. "Finally, our health-care cost situation
remains an extreme burden on our ability to compete; we continue
to work intensely on solutions to this crisis with our labor
unions."

GM Europe

GM Europe (GME) reported earnings of $37 million in the second
quarter of 2005, compared with a loss of $45 million in the year-
ago quarter. These results reflect continued improvement in cost
reduction and the favorable effects of the company's restructuring
efforts. GM's market share in Europe was 9.7 percent in the second
quarter of 2005, unchanged from the year-ago period.

"We're pleased to achieve our first profitable quarter in five
years in Europe, excluding restructuring costs, as GM Europe
continues to make significant progress in its turnaround plan,"
Wagoner said. "The Opel/Vauxhall Astra remains a strong
contributor to our overall results in Europe, and we're encouraged
by the positive reviews of the new Zafira. We still have work to
do in Europe to achieve sustainable profitability, but the
improved results so far this year indicate we're on the right
track."

GM Asia Pacific

GM Asia Pacific (GMAP) earned $176 million in the second quarter
of 2005, up significantly from the $60 million in the first
quarter of this year, but below the $259 million earned in the
year-ago quarter. GM's market share in the Asia-Pacific region
rose to 6.3 percent in the second quarter from 5.6 percent a year
ago, led by gains in China and Thailand. GM continues to turn in a
solid performance in China with sales growing 37 percent in the
second quarter, compared with an overall industry average of 17
percent. GM's market share in China rose to 11.4 percent in the
second quarter of 2005, up from 9.8 percent in the year-ago
period.

"Our performance in China continues to be encouraging, especially
considering our modest presence there just a few years ago,"
Wagoner said. "Going forward, we intend to capitalize on our
momentum in China and take full advantage of the opportunities
presented by this large and rapidly growing market. With the
rollout of additional new vehicles in the second half of the year
and the strength of our current lineup, we anticipate double-digit
sales growth to continue in the second half of 2005."

GM Daewoo Auto and Technology Co

GM Daewoo Auto and Technology Co. delivered strong results in the
second quarter of 2005, with sales gains in both the domestic and
international markets. During the quarter GM increased its stake
in GM Daewoo to 50.9 percent from 48.2 percent. As a result, GM
has begun to consolidate GM Daewoo's financial results.

"GM Daewoo has rapidly become a valuable contributor to the GM
family, particularly with its growing role in GM product programs
in the Asia Pacific region and around the world," Wagoner said.
"Our increased investment is consistent with our strategy to
further develop GM Daewoo as a major player in our global product
development system."

GM Latin America/Africa/Mid-East

GM Latin America/Africa/Mid-East earned $33 million in the second
quarter of 2005, compared with net income of $10 million a year
ago. The latest results reflect higher sales volumes in most
markets and continued progress on cost reduction. GM's market
share in the LAAM region rose to 18.3 percent in the second
quarter of 2005 from 17.1 percent a year ago.

"We're pleased with the overall results in the region, and
particularly our performance in the Mid-East and African areas,
where GM's market share was up 2.8 percentage points in the second
quarter of 2005," Wagoner said.

                            GMAC

General Motors Acceptance Corp. earned $816 million of net income
in the second quarter of 2005, compared with $846 million in the
second quarter of 2004, as lower earnings from financing
operations were partially offset by increased earnings from
mortgage and insurance operations.

"GMAC once again reported impressive earnings despite a difficult
funding environment and lower credit ratings," Mr. Wagoner said.
"During the quarter, Residential Capital Corp., the newly formed
holding company for GMAC's residential mortgage businesses,
successfully completed its first global funding, raising
$4 billion in a private placement. Our ongoing objective for GMAC
is to ensure access to ample liquidity on a cost-competitive
basis, while maintaining and building the extensive mutual
synergies between GMAC and GM."

GMAC's financing operations earned $378 million in the second
quarter of 2005, down from $452 million a year ago, reflecting
lower net interest margins that were partially offset by improved
used vehicle prices and favorable credit experience.

Mortgage operations earned $338 million in the second quarter of
2005, up from the $319 million in the second quarter of 2004.
GMAC's mortgage operations benefited from gains on its investment
portfolio and favorable net servicing results.  This was partially
offset by increased borrowing costs and lower gains on sales of
loans.

Insurance operations reported earnings of $100 million in the
second quarter of 2005, up from the $75 million in the second
quarter of 2004.  Continued improvement in net underwriting
revenue due to favorable loss experience contributed to the
increase in earnings quarter over quarter.

GMAC continued to maintain adequate liquidity, with a total of
$22.2 billion in cash and certain marketable securities as of
June 30, 2005.  GMAC also provided a significant source of cash
flow to GM through the payment of a $500 million dividend in the
second quarter, bringing total dividends paid to date in 2005 to
$1 billion.

                      Cash and Liquidity

Cash, marketable securities, and readily available assets of the
Voluntary Employees' Beneficiary Association (VEBA) trust,
excluding financing and insurance operations, totaled
$20.2 billion at June 30, 2005, up from $19.8 billion on March 31,
2005.  During the second quarter, GM withdrew $1 billion from the
VEBA trust to pay for retiree health care.  On July 1, 2005, GM
withdrew an additional $1 billion from the VEBA.

General Motors Corporation, headquartered in Detroit, Michigan, is
the world's largest producer of cars and light trucks. GMAC, a
wholly-owned subsidiary of GM, provides retail and wholesale
financing in support of GM's automotive operations and is one of
the worlds largest non-bank financial institutions.

As reported in the Troubled Company Reporter on April 11, 2005,
General Motors Corp. delivered it's 2004 annual report on Form
10-K to the Securities and Exchange Commission on March 16, 2005.
While financial results show some improvements from 2003, the
company's performance has steadily declined over the past five
years:

        Total Assets               Total Liabilities
        ------------               -----------------
   1998   $246.6 +            1998   $230.8 +
   1999   $274.7 ++           1999   $253.2 +
   2000   $303.1 +++          2000   $272.0 ++
   2001   $323.9 ++++         2001   $303.5 +++
   2002   $370.1 +++++        2002   $363.0 +++++
   2003   $449.9 ++++++++     2003   $424.4 +++++++
   2004   $482.0 +++++++++    2004   $453.9 ++++++++

        Shareholder Equity         Current Assets
        ------------------         --------------
   1998    $15.8 ++           1998   $119.7 .
   1999    $21.5 ++++         1999   $132.3 +
   2000    $31.1 ++++++++     2000   $144.3 +
   2001    $20.4 ++++         2001   $157.6 ++
   2002     $7.1 .            2002   $230.2 +++++
   2003    $25.5 ++++++       2003   $274.7 ++++++
   2004    $28.1 +++++++      2004   $306.4 ++++++++

        Current Liabilities        Working Capital
        -------------------        ---------------
   1998    $50.2 .            1998    $69.5 ++++
   1999    $57.3 .            1999    $75.0 +++++
   2000   $139.8 ++++++       2000     $4.5 .
   2001   $121.1 +++++        2001    $36.5 ++
   2002   $134.1 ++++++       2002    $96.1 ++++++
   2003   $152.9 +++++++      2003   $121.8 ++++++++
   2004   $170.5 ++++++++     2004   $135.9 +++++++++

        Leverage Ratio             Liquidity Ratio
        --------------             ---------------
   1998     14.6 +            1998      2.4 +++++++++
   1999     11.8 .            1999      2.3 +++++++++
   2000      8.7 .            2000      1.0 ++++
   2001     14.9 +            2001      1.3 +++++
   2002     51.1 ++++++++     2002      1.7 ++++++
   2003     16.6 +            2003      1.8 +++++++
   2004     16.2 +            2004      1.8 +++++++

        Net Sales                  Interest Expense
        ---------                  ----------------
   1998   $147.8 ++++         1998     $6.6 +++++++
   1999   $167.3 ++++++       1999     $7.7 ++++++++
   2000   $184.6 ++++++++     2000     $0.8 .
   2001   $177.2 +++++++      2001     $0.7 .
   2002   $177.3 +++++++      2002     $0.4 .
   2003   $185.8 ++++++++     2003     $1.7 +
   2004   $193.5 +++++++++    2004     $2.4 ++

        EBITDA                     Net Income
        ------                     ----------
   1998    $17.4 +++++        1998     $2.9 ++++
   1999    $21.7 +++++++      1999     $6.0 +++++++++
   2000    $21.3 +++++++      2000     $4.4 +++++++
   2001    $15.1 +++++        2001     $0.6 .
   2002    $14.6 ++++         2002     $1.7 ++
   2003    $18.7 ++++++       2003     $3.8 ++++++
   2004    $17.8 +++++        2004     $2.8 ++++

        EBITDA Margin              Profit Margin
        -------------              -------------
   1998     11.8%+++++        1998      2.0%++++
   1999     13.0%++++++       1999      3.6%++++++++
   2000     11.5%+++++        2000      2.4%+++++
   2001      8.5%++++         2001      0.3%.
   2002      8.2%++++         2002      1.0%++
   2003     10.1%+++++        2003      2.0%+++++
   2004      9.2%++++         2004      1.4%+++

A free copy of GM's latest annual report is available at
http://ResearchArchives.com/t/s?5e


GENEVA STEEL: Panel Extends Benedetto & BF's Retention to Oct. 4
----------------------------------------------------------------
The Official Committee of Unsecured Creditors appointed in Geneva
Steel LLC's chapter 11 case asks U.S. Bankruptcy Court for the
District of Utah, Central Division, for permission to extend the
employment of Benedetto Gartland & Co., Inc. and BF Capital
Partners LLC as its financial advisors.

As reported in the Troubled Company Reporter on January 5, 2005,
the Court authorized the Committee to engage the financial
advisors for two months to help the Committee analyze the Debtor's
proposed reorganization plan, and oust the Debtor's CEO and
counsel.

On May 26, 2005, the Court allowed the Committee to further employ
the financial advisors for three months to provide investment
banking services and negotiate with potential capital providers to
raise capital for development of the Debtor's real estate assets.

The Committee believes that the financial advisors have initiated
a very successful marketing program that has greater value to the
estate.

Accordingly, the Committee wants to further retain Benedetto & BF
as its financial advisors through and including October 4, 2005.
Between now and then, the financial advisors will assist in the
Committee's marketing campaign to maintain the interest and
activity of potential competing bidders.  The papers filed with
the bankruptcy court don't disclose any changes to the flat
$75,000 monthly fee arrangement approved when the financial
advisors were initially retained.

To the best of the Committee's knowledge, Benedetto and BF Capital
are "disinterested" as that term is defined in Section 101(14) of
the Bankruptcy Code.

Headquartered in Provo, Utah, Geneva Steel LLC owns and operates
an integrated steel mill.  The Company filed for chapter 11
protection on January 25, 2002 (Bankr. Utah Case No. 02-21455).
Andrew A. Kress, Esq., Keith R. Murphy, Esq., and Stephen E.
Garcia, Esq., at Kaye Scholer LLP, represent the Debtor in its
chapter 11 proceedings.  When the Company filed for protection
from its creditors, it listed $262 million in total assets and
$192 million in total debts.


GEO GROUP: Moody's Affirms B1 Rating on Senior Unsecured Notes
--------------------------------------------------------------
Moody's Investors Service affirmed The GEO Group, Inc.'s Ba3
Corporate Family Rating (previously called the Senior Implied
Rating), Ba3 Senior Secured Credit Facility, and B1 Senior
Unsecured Notes.

According to Moody's, this rating affirmation reflects GEO Group's
plan to acquire Correctional Services Corporation, another
corrections company, using cash and debt.  The transaction will
further consolidate the private corrections industry, a plus for
GEO Group.  Moreover, while GEO Group's credit profile will be
modestly weakened by the leveraged purchase of CSC, the greater
sector leadership provided by the transaction, and some operating
cost savings, are counterbalances, and over the intermediate term
Moody's expects GEO Group to reduce its leverage.  The rating
outlook remains stable.

Moody's said that the acquisition of CSC by GEO Group will
increase its presence to 55 adult corrections facilities with a
43,500 bed capacity.  The company intends to sell the complicated
juvenile business of CSC to the former management of CSC, or
another potential suitor.  On a pro forma basis, GEO Group will be
second in market share of the global adult corrections market,
behind Corrections Corporation of America, with a share of around
one-fourth.  Moody's recognizes steps that GEO Group has taken to
insulate itself from potential issues arising out of the
transaction, primarily the likely sale of the juvenile business
and litigation liabilities at CSC.

GEO Group currently conducts business with many of the same state
and federal government agencies as CSC.  Moody's cites concern
with customer concentration, particularly given fluid political
attitudes with respect to privatizing what has been a
traditionally public institution.  The US Government represents
27% of GEO Group's revenue, with Texas at 9% and Florida at 12%.
CSC's major customers are the US Government at 31%, Arizona at 20%
and Texas at 14%.

GEO Group is paying a total cash price of $62 million, plus the
assumption of $124 million of non-recourse debt secured by four
adult facilities.  Cash on hand and new debt will fund the cash
portion of the acquisition.

The stable outlook incorporates Moody's expectation that GEO Group
will successfully integrate the adult corrections business of CSC,
and divest of the juvenile business.  Moody's also anticipates
that GEO Group will continue to effectively manage expiring,
terminating or uneconomic corrections contracts.  The rating
agency also expects GEO Group will continue to add profitable new
contracts and customers to its roster.

Moody's would likely upgrade GEO Group's ratings should the
company increase its revenues to more than $750 million, with
sustained gross profit margins above 20%, much reduced effective
debt, and interest coverage greater than 3.5X.

A rating downgrade would likely occur should there be difficulty
integrating CSC, disposing of the juvenile business, or litigation
problems.  In addition, a stalling of revenue growth, most likely
related to major tenant loss, or a reverse of the firm's recent
overall deleveraging trend would likely lead to a rating
downgrade.

These ratings were affirmed with a stable outlook:

  The GEO Group, Inc.:

   * Corporate Family Rating at Ba3;
   * Senior Secured Credit Facility at Ba3;
   * Senior Unsecured Notes at B1

The GEO Group, Inc. (NYSE: GEO) is a world leader in the delivery
of correctional and detention management, health and mental
health, and related services to federal, state and local
government agencies.  GEO Group offers a turnkey approach that
includes design, construction, financing and operations.  GEO
Group represents government clients in the USA, Australia, South
Africa and Canada, managing 41 facilities with a total design
capacity of approximately 36,000 beds.

Correctional Services Corporation (Nasdaq: CSCQ) is a leading
developer and operator of adult correctional facilities, with
contracts and awards for the operation of 15 facilities with
approximately 7,500 beds.  In addition, through its Youth Services
International subsidiary, CSC is a leading private provider of
juvenile programs for adjudicated youths with 17 facilities and
1,300 juveniles in its care.


GREAT ATLANTIC: Moody's Reviews Senior Unsec. Notes' Junk Rating
----------------------------------------------------------------
Moody's Investors Service placed the ratings of The Great Atlantic
& Pacific Tea Company, Inc. on review for possible upgrade
following the announcement that its subsidiary, A&P Luxembourg
S.a.r.l., had entered into an agreement to sell A&P Canada for
total consideration of the Canadian dollar equivalent of $1.475
billion.  The review for possible upgrade reflects the anticipated
significant increase in cash and material reduction in debt when
the transaction is completed around mid-August.

METRO INC., a supermarket and pharmaceutical operator in Quebec
and Ontario, will acquire A&P Canada for the Canadian dollar
equivalent of $982 million in cash, $409 million in METRO stock
and about $84 million in the assumption of certain debt.  In
addition, METRO will pay $16 million annually for the next several
years under an information technology transition agreement.  Based
on a Metro C$27.66 share price, A&P's anticipated equity stake in
METRO will represent a 15.83% ownership interest; A&P will have 2
representatives on METRO's board.

A&P has stated that it will apply a portion of the cash proceeds
to fund the repurchase of or a tender offer for its bonds due in
2007 and 2011 which aggregate about $429 million.  Invested cash
immediately after this debt prepayment will likely approach $500
million, exceeding the remaining debt and capitalized leases.
However, the disposal of Canada also greatly reduces consolidated
earnings -- pre-tax profit before certain charges in fiscal 2004
was $56.3 million in Canada and a loss of $129.2 million in A&P's
US operations.  As a result, key credit metrics such as gross
leverage and interest coverage will be negatively impacted in the
near term.

The proposed sale of A&P Canada is one of a number of strategic
initiatives that the company has undertaken to boost
profitability, strengthen the capital structure and fund more
aggressive capital expenditures.  In June, A&P announced the
transfer of its U.S. distribution operations to C&S Wholesale
Grocers, with estimated annual savings of $40 million after one-
time costs of $65 to $75 million.  The company also plans to
divest its Farmer Jack and Food Basics operations in Michigan and
Ohio.  Consequently, the resulting smaller scale A&P operations
will be concentrated in the Northeast where the company will be
able to better focus on expanding its fresh and discount retail
formats and on improving operating efficiency.

Moody's review will focus on:

   * the application of the company's remaining large cash
     balances;

   * financial policies regarding future debt reduction and
     shareholder enhancement;

   * ongoing capital expenditure programs; and

   * the likely returns on the company's investment in converting
     its remaining stores to a "fresh" format.

The maintenance of significant cash levels, combined with plans to
bolster profit margins in the core Northeast stores, could result
in an upgrade at the conclusion of the review.  Conversely, the
use of material amounts of cash for shareholder enhancement and/or
further erosion in sales and earnings in the remaining US business
segments could result in the ratings being confirmed at existing
levels.

Ratings placed under review for possible upgrade:

The Great Atlantic & Pacific Tea Company, Inc.:

   * Corporate Family rating at B3
   * Senior secured and guaranteed bank agreement at B2
   * Senior unsecured notes at Caa1

   * Multi-seniority shelf at (P)Caa1 for senior, (P)Caa2 for
     subordinated, (P)Caa2 for junior subordinated, and (P)Caa3
     for preferred stock.

   * Speculative Grade Liquidity Rating of SGL-3

A&P Finance I, A&P Finance II and A&P Finance III:

   * Trust preferred securities shelf at (P)Caa2

Headquartered in Montvale, New Jersey, The Great Atlantic &
Pacific Tea Company, Inc. operates 637 supermarkets in 10 states,
the District of Columbia and Ontario, Canada.  Sales for the
fiscal year ended February 26, 2005 were approximately $10.8
billion.


GRUPO DINA: Extends Exchange Offer on 8% Debentures to Aug. 16
--------------------------------------------------------------
Consorcio G Grupo Dina, S.A. de C.V. will accept for tender and
consummate by July 21, 2005 or as soon thereafter as practicable
its exchange offer for all of its outstanding 8% Convertible
Subordinated Debentures Due August 8, 2004 (CUSIP No. 210306 AB 2)
validly tendered as of the close of business on July 19, 2005,
approximately $6.9 million.  Grupo Dina further said that it will
extend the Exchange Offer and related waiver solicitation which
will now expire at 5:00 p.m., New York City time, on Tuesday,
Aug. 16, 2005.  Although Grupo Dina reserves the right to further
extend the Exchange Offer and related waiver solicitation beyond
Aug. 16, 2005, it does not currently expect to do so.

The Exchange Offer is being made solely pursuant to the Offer to
Exchange and Related Waiver Solicitation Statement dated June 7,
2005 and the related Letter of Transmittal and Waiver.  Dina is
offering holders of Debentures one Contingent Value Right for each
$1,000 aggregate principal amount of Debentures tendered and is
also offering holders a waiver payment of $50 for each $1,000
aggregate principal amount of Debentures as to which a waiver is
delivered.

Debentures holders may not tender Debentures without also granting
the waiver and may not grant the waiver without also tendering
their Debentures.  The Contingent Value Rights entitle holders to
certain net cash proceeds received upon the occurrence of certain
events as described in the Statement.  The Waiver being sought
relates to payment defaults and legal claims in respect of the
Debentures as described in the Statement.

This announcement is neither an offer to purchase Debentures nor a
solicitation of an offer to sell CVRs.  The Exchange Offer and
waiver solicitation is not being made to, nor will tenders be
accepted from, or on behalf of, holders of existing Debentures in
any jurisdiction in which the making of the Exchange Offer and
waiver solicitation or the acceptance thereof would not be in
compliance with the laws of such jurisdiction.

Consorcio G Grupo Dina, SA de CV(DINA).  The Group's principal
activities are manufacturing, selling and leasing of trucks and
spare parts in Mexico, USA and Canada.  Plastics parts accounted
for 54% of 2001 Revenues; Trucks, 23%; Spare parts, 19% and
Corporate services, 4%. Operates in Mexico and Argentina.


HEARTLAND TECH: Creditors Must Submit Proofs of Claim by Sept. 14
-----------------------------------------------------------------
The U.S. Bankruptcy Court for Northern District of Illinois,
Eastern Division, set Sept. 14, 2005, at 4:00 p.m., as the
deadline for all creditors owed money on account of claims arising
prior to June 15, 2005, against Heartland Technology Inc. and its
debtor-affiliates to file proofs of claim.

Creditors must file written proofs of claim that comply with
Official Form No. 10.  Blank claim forms are available at no
charge at http://www.uscourts.gov/bkforms/

All proofs of claim must be filed with:

      The Clerk of Court
      U.S. Bankruptcy Court
      Northern District of Illinois, Eastern Division
      219 South Dearborn Street, Room 614
      Chicago, Illinois 60604

Governmental units wishing to assert a claim against the Debtors
must file Proofs of Claim within 180 days after the Order for
Relief in this chapter 11 case is given.

Headquartered in Chicago, Illinois, Heartland Technology Inc. fka
Milwaukee Land Company, acquired and managed land used in the
railroad operations.  The Company and its affiliates filed for
chapter 11 protection on June 15, 2005 (Bankr. N.D. Ill. Case No.
05-23747).  Geoffrey S. Goodman, Esq., at Foley & Lardner LLP
represents the Debtors in their liquidation efforts.  When the
Debtors filed for protection from their creditors, they estimated
between $10,000,000 in total assets and $34,000,000 in total
debts.


HEARTLAND TECH: Plan Confirmation Hearing Scheduled for Aug. 23
---------------------------------------------------------------
The U.S. Bankruptcy Court for Northern District of Illinois,
Eastern Division, will hold a combined hearing on the approval of
the Disclosure Statement explaining Heartland Technology, Inc.,
and its debtor-affiliates' Joint Plan of Liquidation and the
confirmation of the Plan at 10:30 a.m. on Aug. 23, 2005, at 219
South Dearborn Street, Courtroom 744, in Chicago, Illinois.

The Debtors requested a combined hearing on the approval of the
Disclosure Statements and confirmation of their Plan to reduce
cost and because all their creditors are aware of the
circumstances of their chapter 11 case and will likely support the
Plan.

The Honorable Eugene Wedoff authorized the Debtors to distribute
the Disclosure Statement and solicit acceptances of the Plan.
Creditors must complete their ballots (indicating whether they
accept or reject the plan) and return them by 4:00 p.m. on
Aug. 15, 2005 to:

       Katherine E. Hall, Esq.
       Foley & Lardner LLP
       321 North Clark Street, Suite 2800
       Chicago, Illinois 60610

As reported in the Troubled Company Reporter on June 17, 2005, the
Debtors submitted their Joint Plan of Liquidation together with
their bankruptcy petition.  The Liquidating Plan contemplates the
liquidation or other dispositions of the Debtors' assets.

The Plan provides for a comprehensive settlement of all issues
between the Debtors, Heartland Partners and CMC Heartland
Partners.  The Debtors' remaining assets and the funds received
from the Heartland Partners Settlement Payments will fund
distributions to the Debtors' creditors.  The Plan also provides
for the transfer of the Debtors' assets on the effective date of
the Plan to a liquidating trust to be administered by a
liquidating trustee.  The Liquidating Trustee will liquidate any
remaining assets of the Debtors including causes of action,
administer claims, and make distributions on account of allowed
claims.

Objections to the Plan, if any, must be filed and served by
Aug. 15, 2005.

Headquartered in Chicago, Illinois, Heartland Technology Inc. --
fka Milwaukee Land Company -- acquired and managed land used in
the railroad operations.  The Company and its affiliates filed for
chapter 11 protection on June 15, 2005 (Bankr. N.D. Ill. Case No.
05-23747).  Geoffrey S. Goodman, Esq., at Foley & Lardner LLP
represents the Debtors in their liquidation efforts.  When the
Debtors filed for protection from their creditors, they estimated
between $10,000,000 in total assets and $34,000,000 in total
debts.


HOST MARRIOTT: Earns $91 Million of Net Income in Second Quarter
----------------------------------------------------------------
Host Marriott Corporation (NYSE: HMT) reported results of
operations for the second quarter ended June 17, 2005.

Total revenue increased 10.6% to $993 million for the second
quarter and 8.1% to $1,811 million for year-to-date 2005.  Net
income was $91 million for the second quarter of 2005 compared to
$17 million for the second quarter 2004

Net income include gains of $17 million for the second quarter
2005 compared to losses of $12 million for the second quarter
2004, associated with refinancing the Company's senior notes and
the redemption of its Class B preferred stock, combined with gains
on hotel dispositions and, in 2005, the gain from the sale of 85%
of the Company's interest in CBM Joint Venture LLC, a joint
venture that owns 120 Courtyard by Marriott hotels.

Comparable hotel RevPAR for the second quarter of 2005 increased
9.8% and comparable hotel adjusted operating profit margins
increased 2.0 percentage points when compared to the second
quarter of 2004.  The Company's second quarter increases in
comparable hotel RevPAR and comparable hotel adjusted operating
profit margins were driven by an 8.8% increase in average room
rates and a 0.7 percentage point increase in occupancy.  Year-to-
date 2005 comparable hotel RevPAR increased 8.8% (comprised of a
7.9% increase in average room rates and an increase in occupancy
of 0.6 percentage points), while comparable hotel adjusted
operating profit margins increased 1.6 percentage points when
compared to year-to-date 2004.

Christopher J. Nassetta, president and chief executive officer,
stated, "We had an outstanding second quarter as we continue to
benefit from significant increases in average room rates, as well
as improving occupancy.  We expect that lodging demand and
business travel will continue to increase, driving continued
strong results in the second half of 2005."

                     Financing Transactions

On May 20, 2005, the Company redeemed all four million shares of
its 10% Class B Cumulative Redeemable preferred stock for an
aggregate redemption price of approximately $101 million including
accrued dividends.  During the second quarter, the Company also
used the remaining proceeds of $345 million from the March 10,
2005 issuance of 6-3/8% Series N senior notes to redeem or prepay
$329 million of debt and to pay the related prepayment premiums.

On March 29, 2005, the Company completed the sale of 85% of its
interest in CBM Joint Venture LLC for approximately $92 million,
which resulted in a gain of approximately $42 million, net of tax.
The proceeds from this sale will be reinvested in either the
acquisition of upper-upscale or luxury hotels, return on
investment/repositioning projects, repayment of debt or for other
general corporate purposes.

As of June 17, 2005, the Company had $404 million of cash and cash
equivalents and $167 million of restricted cash.  The Company has
$575 million of availability under its credit facility and no
amounts outstanding.

W. Edward Walter, executive vice president and chief financial
officer, stated, "The significant improvement in our operations
combined with the strengthened balance sheet leaves the company
well positioned to pursue our strategy of acquisitions,
investments in our portfolio and other corporate goals."

Host Marriott -- http://www.hostmarriott.com/-- is a Fortune 500
lodging real estate company that currently owns or holds
controlling interests in 107 upper-upscale and luxury hotel
properties primarily operated under premium brands, such as
Marriott(R), Ritz- Carlton(R), Hyatt(R), Four Seasons(R),
Fairmont(R), Hilton(R) and Westin(R)(*).

                       *     *     *

As reported in the Troubled Company Reporter on June 24, 2005,
Standard & Poor's Ratings Services revised its outlook on hotel
owner Host Marriott Corp. to positive from stable.

At the same time, Standard & Poor's affirmed its ratings,
including its 'B+' corporate credit rating, on the Bethesda,
Maryland-based company.  Approximately $5.4 billion in total debt
(excluding $492 million convertible subordinated debentures) was
outstanding as of March 31, 2005.

"The outlook revision reflects Host's progress during the past
several quarters in improving credit measures due to earnings
growth and modest debt reduction," said Standard & Poor's credit
analyst Sherry Cai.  Host has acquired a number of hotels during
this time, but funded them in a manner that allowed its balance
sheet to continue to improve (e.g. funded with surplus cash and/or
proceeds from asset sales or equity offerings).  Credit measures
are expected to improve further in the next several quarters in
large part as earnings benefit from healthy industry conditions.


HUNT HOPPOUGH: Case Summary & 22 Largest Unsecured Creditors
------------------------------------------------------------
Debtor: Hunt Hoppough Custom Crafted Structures, Inc.
        700 Reed Street
        Belding, Michigan 48809

Bankruptcy Case No.: 05-10043

Chapter 11 Petition Date: July 20, 2005

Court: Western District of Michigan (Grand Rapids)

Judge: Jeffrey R. Hughes

Debtor's Counsel: Perry G. Pastula, Esq.
                  Dunn Schouten & Snoap PC
                  2745 DeHoop Avenue Southwest
                  Wyoming, Michigan 49509
                  Tel: (616) 538-6380

Total Assets: $577,545

Total Debts:  $2,289,819

Debtor's 22 Largest Unsecured Creditors:

   Entity                     Nature of Claim       Claim Amount
   ------                     ---------------       ------------
TLK Holdings, Inc.            Value of security:        $323,500
5751 Belding Road             $498,713
Belding, MI 48809

Kurt Thomas                                             $150,000
5751 Belding Road
Belding, MI 48809

Richard Thomas                Value of security:        $148,500
P.O. Box 66                   $498,713
Belding, MI 48809

Chemical Bank-West            Value of security:        $130,516
                              $505,484

W.L. Perry & Associates                                  $82,032

Menards - HSBC Business                                  $51,644

Lumberman's Inc.                                         $46,466

Hager Distribution                                       $43,983

Citi Platinum Select                                     $40,671

Schultz & Snyder                                         $38,272

Falcon Products                                          $29,000

Blue Linx                                                $28,411

Builders Plumbing                                        $28,167

Shoemaker Inc.                                           $26,589

North American Forest                                    $26,338

Contractors Steel                                        $24,733

Doors Plus                                               $23,850

MBNA Platinum Plus for                                   $23,275
Business

Home Acres                                               $20,673

Thomas Real Estate                                       $19,993

Grinnell Door Company                                    $16,952

Grand Rapids Sash & Door                                 $16,351


INNOPHOS INC: Favorable Summary Judgment Cues S&P's Stable Outlook
------------------------------------------------------------------
Standard & Poor's Ratings Services revised the outlooks on
specialty chemical manufacturer Innophos Inc. and its parent
Innophos Investments Holdings Inc., to stable from negative.  The
outstanding ratings, including the 'B' corporate credit ratings,
are affirmed.

The outlook revisions reflect the favorable summary judgment in a
New York State court regarding Innophos' Mexican tax claim dispute
with Rhodia S.A.  "Moreover, operating income is rising, and with
the ability for debt reduction in the near term, very aggressive
leverage measures should experience improvement," said Standard &
Poor's credit analyst Wesley E. Chinn.

The ratings of Cranbury, New Jersey-based Innophos, which is owned
by affiliates of Bain Capital LLC, reflect a moderate sales base
of about $550 million, a narrow product line in a niche, mature
market, some vulnerability to raw-material costs and to the
cyclicality of general economic conditions, and very aggressive
debt leverage.  These negatives overshadow the company's solid
position in the production of specialty phosphates, expected
higher earnings for 2005, and good operating margins.

Specialty phosphates are used in a variety of food and beverage,
consumer products, pharmaceutical and industrial applications.
Specific uses include improving the texture and taste of food, a
toothpaste abrasive for whitening, and improving the cleaning
characteristics of detergents.

Innophos has leading shares in all three major product segments of
the specialty phosphates industry:

    * purified phosphoric acid (which is used in part in the
      downstream production of phosphate derivatives),

    * specialty salts and acids, and

    * technical grade sodium tri-polyphosphate.

Specialty salts and acids account for roughly half of Innophos'
sales.

The North American specialty phosphates market, a highly
specialized niche in the broader global phosphates market, is
estimated at $1.1 billion.  Favorable industry characteristics
include stable volume growth because of food and beverage,
consumer products and pharmaceutical applications; significant
capital costs (to add a plant in this niche market), technical
complexity, and freight costs contributing to high entry barriers;
and meaningful customer switching costs.  In addition, industry
fundamentals have improved, as consolidation activity has resulted
in two primary producers in each of the three product segments,
and penetration of imports remains at low levels (historically at
less than 12% of North American unit consumption).


INTEGRATED HEALTH: Briarwood Asks Court to Deny Summary Judgment
----------------------------------------------------------------
As reported in the Troubled Company Reporter on January 6, 2005,
Briarwood Corporation asked the U.S. Bankruptcy Court for the
District of Delaware to compel IHS Liquidating to comply with the
terms of the Stock Purchase Agreement.

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

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

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

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

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

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

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

                      IHS Liquidating Responds

IHS Liquidating LLC asserts that Abe Briarwood Corporation's
claims are completely without merit and are inconsistent with the
Stock Purchase Agreement's terms.

Kenneth J. Enos, Esq., at Young Conaway Stargatt & Taylor, LLP, in
Wilmington, Delaware, relates that three of Briarwood's claims
-- the Tax Claim, the Vendor Claim, and the Georgia Claim - seek
reimbursement from IHS Liquidating for the IHS Debtors' pre-
Closing liabilities, which according to Briarwood should have been
paid by the IHS Debtors before Closing or should have been
pre-funded out of the IHS Debtors' cash existing at Closing.

"The fatal flaw in Briarwood's logic is that it has already waived
all of these claims as a result of a Working Capital resolution
that was reached at the Closing of the SPA," Mr. Enos notes.

IHS Liquidating and Briarwood agreed that "the actual Working
Capital as of the Closing would be deemed to equal the contractual
'baseline' Working Capital amount of $62 million," thereby
eliminating any upward or downward purchase price adjustment based
on Working Capital.

Mr. Enos contends that Briarwood's attempt to recast the Working
Capital item as liabilities that the IHS Debtors should have paid
or funded at Closing is merely a ploy to reap a windfall from IHS
Liquidating, when in fact, Briarwood has already received what it
bargained for -- a business enterprise with current assets and
liabilities equating to Working Capital of at least $62 million.

"Briarwood's claims also fail for the independent reason that
Briarwood did not even pay the liabilities for which it seeks
reimbursement and has failed to demonstrate that it suffered any
damages," Mr. Enos adds.

Mr. Enos reiterates that both Briarwood's (x) additional $17.1
million claim based on its assertion that IHS Liquidating
improperly used that amount of post-closing collections of
Briarwood's receivables; and (y) $350,000 claim for reimbursement,
in respect of the Claim to IOS Capital Inc., lack merit because:

     -- the so-called Medicare "Receivables" underlying the United
        States Settlement Claim was never part of the Working
        Capital that was sold to Briarwood under the Stock
        Purchase Agreement, but rather was part of a settlement
        that would involve a set-off against a $19.1 million
        "payable" to the United States; and

     -- the liability underlying the IOS Claim is not an Excluded
        Liability within the meaning of the Stock Purchase
        Agreement.

Accordingly, IHS Liquidating asks the Court for a judgment:

    (a) denying Briarwood's request in its entirety;

    (b) granting its attorney's fees and costs associated with the
        dispute;

    (c) in the event Briarwood's interpretation of the Stock
        Purchase Agreement is accepted, directing Briarwood to
        reimburse it for the net $2 million payment it made to the
        United States;

    (d) compelling Briarwood to pay or cause its subsidiaries to
        comply with a settlement agreement between the IHS Debtors
        and Rotech Medical Corporation that resolved their various
        intercompany claim issues;

    (e) compelling Briarwood to comply with its obligation to
        replace or secure a letter of credit in favor of Greenwich
        Insurance Company and reimburse IHS Liquidating for costs
        it has incurred as a result of Briarwood's failure to
        comply with the obligation; and

    (f) rescinding the Stock Purchase Agreement based on
        Briarwood's material misrepresentations, which induced IHS
        Liquidating to consummate the Stock Purchase Agreement
        notwithstanding Briarwood's pre-Closing defaults.

                         Briarwood Retorts

Frederick B. Rosner, Esq., at Jaspan Schlesinger Hoffman LLP, in
Wilmington, Delaware, contends that IHS Liquidating's Working
Capital "resolution" and waiver theory is based on incorrect
propositions.  Contrary to IHS Liquidating's assertions, Mr.
Rosner says, Briarwood did not waive any of its claims against the
IHS Debtors for incorrect representations or warranties and
non-compliance with the Stock Purchase Agreement covenants.

Mr. Rosner explains that the gravamen of Briarwood's claims is not
for breach of contract, but rather to:

    (i) compel IHS Liquidating to comply with the terms of the
        Stock Purchase Agreement; and

   (ii) turn over to Briarwood $18.5 million for the Trust Fund
        Taxes, Georgia Medicaid Payments and Trade Vendor Payments
        that IHS Liquidating pocketed.

Moreover, since IHS Liquidating concedes that damages would only
be required to prove a breach of contract claim, they are
irrelevant to Briarwood's claim.

IHS Liquidating's fraud and rescission claim is nothing more than
an attempt to divert the Court from IHS Liquidating's own "bad
faith pattern of conduct, Mr. Rosner asserts.  It should be noted
that IHS Liquidating never even mentioned any fraud and rescission
claim until the filing of its Cross-Motion, 22 months after the
Closing of the Stock Purchase Agreement.

Accordingly, Briarwood asks the Court to deny IHS Liquidating's
request.

Integrated Health Services, Inc. -- http://www.ihs-inc.com/--
operated local and regional networks that provide post-acute care
from 1,500 locations in 47 states.  The Company and its
437 debtor-affiliates filed for chapter 11 protection on
February 2, 2000 (Bankr. Del. Case No. 00-00389).  Rotech Medical
Corporation and its direct and indirect debtor-subsidiaries broke
away from IHS and emerged under their own plan of reorganization
on March 26, 2002.  Abe Briarwood Corp. bought substantially all
of IHS' assets in 2003.  The Court confirmed IHS' Chapter 11 Plan
on May 12, 2003, and that plan took effect September 9, 2003.
Michael J. Crames, Esq., Arthur Steinberg, Esq., and Mark D.
Rosenberg, Esq., at Kaye, Scholer, Fierman, Hays & Handler, LLP,
represent the IHS Debtors.  On September 30, 1999, the Debtors
listed $3,595,614,000 in consolidated assets and $4,123,876,000 in
consolidated debts.  (Integrated Health Bankruptcy News, Issue
No. 92; Bankruptcy Creditors' Service, Inc., 215/945-7000)


INTEGRATED HEALTH: Wants Removal Period Extended to Aug. 5
----------------------------------------------------------
IHS Liquidating LLC asks the U.S. Bankruptcy Court for the
District of Delaware to extend the period within which it may file
notices of removal with respect to civil actions pending on the
date Integrated Health Services filed for chapter 11 protection,
through and including August 5, 2005.

Robert S. Brady, Esq., at Young Conaway Stargatt & Taylor, LLP, in
Wilmington, Delaware, reminds the Court that IHS Liquidating is
responsible for litigating and settling disputed claims against
the IHS Debtors, some of which are the subject of actions
currently pending in the courts of various states and federal
districts.  In fact, IHS Liquidating is in the process of
investigating the Prepetition Actions to determine which will be
litigated, and whether they should be removed pursuant to Rule
9027(a) of the Federal Rules of Bankruptcy Procedure.

Mr. Brady explains that an extension will give IHS Liquidating
more time to make more fully informed decisions concerning the
removal of each Prepetition Action, and will assure that IHS
Liquidating does not forfeit the valuable rights afforded to it
under Section 1452 of the Judiciary Code.  In addition, the rights
of IHS Liquidating's adversaries will not be prejudiced by an
extension, as any party to a Prepetition Action that is removed
may seek to have it remanded to the state court.

The Court will convene a hearing on July 27, 2005, to consider IHS
Liquidating's request.  IHS Liquidating's Removal Period is
automatically extended through the conclusion of that hearing by
application of Del.Bankr.LR 9006-2.

Integrated Health Services, Inc. -- http://www.ihs-inc.com/--
operated local and regional networks that provide post-acute care
from 1,500 locations in 47 states.  The Company and its
437 debtor-affiliates filed for chapter 11 protection on
February 2, 2000 (Bankr. Del. Case No. 00-00389).  Rotech Medical
Corporation and its direct and indirect debtor-subsidiaries broke
away from IHS and emerged under their own plan of reorganization
on March 26, 2002.  Abe Briarwood Corp. bought substantially all
of IHS' assets in 2003.  The Court confirmed IHS' Chapter 11 Plan
on May 12, 2003, and that plan took effect September 9, 2003.
Michael J. Crames, Esq., Arthur Steinberg, Esq., and Mark D.
Rosenberg, Esq., at Kaye, Scholer, Fierman, Hays & Handler, LLP,
represent the IHS Debtors.  On September 30, 1999, the Debtors
listed $3,595,614,000 in consolidated assets and $4,123,876,000 in
consolidated debts.  (Integrated Health Bankruptcy News, Issue
No. 92; Bankruptcy Creditors' Service, Inc., 215/945-7000)


INT'L PAPER: Moody's Reviews (P)Ba1 Preferred Shelf Rating
----------------------------------------------------------
Moody's Investors Service placed International Paper Company's
ratings on review for possible downgrade.  The rating action
follows an announcement by International Paper Company of an
ambitious "transformation" of its business that contemplates
significant changes being implemented over a 2-to-3 year period.

Over the recent past, IP's financial performance and credit
protection metrics have significantly lagged the targets outlined
by Moody's as being appropriate for the existing rating (a minimum
retained cash flow to total debt of 20% and free cash flow to
total debt of 10%; both considered as median ratios of through the
cycle performance in the context for a company with significant
latent asset value).  It being acknowledged that IP has signaled a
commitment to maintaining an investment grade rating and the
transformation contemplates debt reduction, there is the
possibility that results will continue to lag the relevant metrics
when the "transformation" is complete.

In order to fully consider the matter, Moody's will look to
clarify and review:

   * the company's plans with respect to establishing an
     appropriate capital structure and dividend policy;

   * asset divestiture plans;

   * plans to achieve cost savings;

   * growth imperatives and acquisition parameters;

   * liquidity planning; and

   * details on how the "core" businesses will be positioned and
     operated.

Moody's expects this review to be completed within 90 days.
Moody's expects that ratings will continue to be investment grade
following completion of the review.

Ratings placed on review for possible downgrade:

International Paper Company:

   * Senior Unsecured Baa2
   * Subordinate Shelf (P)Baa3
   * Preferred Shelf (P)Ba1
   * Commercial Paper P-2

International Paper Capital Trust II:

   * Bkd Preferred Stock Baa3
   * International Paper Capital Trust III:
   * Bkd Preferred Shelf Baa3

International Paper Capital Trust IV:

   * Bkd Preferred Shelf (P) Ba1
   * International Paper Capital Trust VI:
   * Bkd Preferred Shelf (P) Ba1

Champion International Corporation:

   * Senior Unsecured Baa2
   * Federal Paper Board Co., Inc.
   * Senior Unsecured Baa2

Union Camp Corporation:

   * Senior Unsecured Baa2

International Paper Company, headquartered in Stamford, CT, is a
worldwide producer of:

   * printing papers,
   * packaging, and
   * forest products.


INTERPUBLIC GROUP: Names Frank Mergenthaler as New EVP & CFO
------------------------------------------------------------
The Interpublic Group (NYSE: IPG) named Frank Mergenthaler
Executive Vice President and Chief Financial Officer.

Mr. Mergenthaler, 44, joins Interpublic with extensive experience
in the media and entertainment industries, having played
increasingly important roles in the finance operations of major
multinationals such as The Seagram Company and Vivendi Universal,
as well as at Columbia House.  Previously, he spent over a decade
at Price Waterhouse, becoming a partner at the accounting firm in
1996.  Mr. Mergenthaler will begin work at Interpublic on August 1
and will replace Robert Thompson, who is leaving the company.

"I am very pleased that Frank has agreed to join us," said Michael
I. Roth, Interpublic's Chairman and CEO.  "He's a first-class
executive who has personal experience with and great command of
every facet of the finance function.  He's comfortable and
effective in dealing with operating issues and has a strong
strategic sense.  His experiences in related industries and at a
major accounting firm provide a unique background that will allow
him to step in and make significant contributions here at
Interpublic.  I very much look forward to having him as my partner
as we progress in the turnaround here at Interpublic."

"This is a unique opportunity," said Mr. Mergenthaler, "to be part
of a strong new management team and work with Interpublic's many
terrific brands and talented individuals.  In the complex media
environment we all face, there's an increasing need on the part of
clients for effective marketing programs and services.  I'm
excited to work with Michael, who made it very clear that he was
looking for a CFO who would serve as his operating partner and be
an important driver of the turnaround to which he is committed."

Most recently, Mr. Megrenthaler was Executive Vice President and
Chief Financial Officer of Columbia House Company a direct
marketer of entertainment content, which he joined in 2002,
following the successful leveraged buyout by the Blackstone Group.
At Columbia House, he worked with the CEO to drive all major
strategic and operational management decisions, including the
company's recent sale to Bertelsman.  While at Columbia House,
Mergenthaler redesigned the Corporate Finance and Controller
functions, established the Internal Audit function and was the
primary liaison with debt holders and other financial
constituents.  He also led the re-engineering of the company's
information technology function and drove cost rationalizations,
resulting in dramatic improvements in margins.

From 2001 to 2002, Mr. Mergenthaler served as Senior Vice
President and Deputy Chief Financial Officer for Vivendi
Universal, making him the company's most senior U.S. finance
executive.  In this role, he oversaw Internal Audit and managed
integration of the global finance function following multiple
Vivendi acquisitions.

At The Seagram Company, which he joined in 1996, Mr. Mergenthaler
rose from Assistant Treasurer to Controller and, ultimately,
Senior Vice President and Chief Accounting Officer.  In these
roles, he provided leadership and direction to financial
executives of three multi-billion dollar business units, led
successful corporate overhead reduction initiatives and managed a
global shared services group with centers in North America and
Europe.

From 1983 to 1996, Mr. Mergenthaler held various positions at
Price Waterhouse.  While at the firm, he managed a number of
multinational clients in the consumer products, entertainment and
financial services industries.

Interpublic Group is one of the world's leading organizations of
advertising agencies and marketing-services companies. Major
global brands include Draft, Foote Cone & Belding Worldwide,
FutureBrand, GolinHarris International, Initiative, Jack Morton
Worldwide, Lowe Worldwide, MAGNA Global, McCann Erickson, Octagon,
Universal McCann and Weber Shandwick.  Leading domestic brands
include Campbell-Ewald, Deutsch and Hill Holliday.

                         *     *     *

As reported in the Troubled Company Reporter on June 30, 2005,
Interpublic indicated that its extensive financial analysis and
review process continues to be substantially manual and broad, in
both accounting and geographic scope.  As previously disclosed,
this review process has identified items that may require
adjustments to prior period financial statements.  Going forward,
the company's plan to remediate internal control weaknesses
includes rolling out an SAP information technology platform and
continuing to develop shared services centers for financial
reporting, as well as hiring and integrating new accounting
personnel.

As agreed in its March 2005 amendments to indentures governing its
five public debt issues, Interpublic will pay an additional fee of
$1.25 per $1,000 aggregate principal amount to consenting
bondholders due to the fact that that its financial filings will
be made by September 30, 2005 but not by June 30, 2005.


IPCS INC: Horizon Merger Prompts S&P to Affirm Junk Ratings
-----------------------------------------------------------
Standard & Poor's Ratings Services affirmed its ratings on
Schaumburg, Illinois-based Sprint PCS affiliate iPCS Inc.,
including its 'CCC+' corporate credit rating and 'CCC' senior
unsecured debt rating.  The outlook is developing.

Standard & Poor's also affirmed its 'CCC' rating on the senior
unsecured debt of another Sprint PCS affiliate, Horizon PCS Inc.
These affirmations follow the recently completed merger of Horizon
into iPCS Inc.  Under the terms of the merger agreement, iPCS
became the obligor of Horizon PCS's $125 million senior notes.
Pro forma for the merger, total debt outstanding is about $290
million.

"The rating on the merged company reflects its high business risk
profile common to all Sprint PCS affiliates, its below-average
EBITDA margin, the negligible net free cash flow of the pre-merger
iPCS and net free cash flow negative status of Horizon PCS, and
potential for higher debt leverage in order to support next-
generation evolution data only technology," said Standard & Poor's
credit analyst Catherine Cosentino.  These factors are tempered
somewhat by the opportunity for growth given the combined
company's relatively low 3.9% penetration rate. As a result of the
merger, iPCS has become the third-largest Sprint PCS affiliate in
terms of subscribers (443,900 as of March 31, 2005).

The merged company's weak business position stems from the fact
that a material amount of its revenue mix is dependent on roaming.
Roaming revenue, which can be volatile, represented about 30% of
the combined company's total revenues for the first quarter of
2005.  A substantial portion of the roaming revenue is derived
from Sprint PCS and affiliates.  Although a new affiliate
agreement is in place with Sprint PCS, which favorably increased
the travel (roaming) rate to $0.058 per minute through Dec. 31,
2006, uncertainty exists as to the future level of roaming revenue
given the pending Sprint Corp./Nextel Communications Inc. merger.

Most recently, on July 15, iPCS filed a court complaint against
Sprint PCS.  The company alleges that Sprint PCS's acquisition of
Nextel and use of these services in iPCS' territory would breach
iPCS' exclusivity rights under the Sprint PCS management
agreement.  However, at this point, Standard & Poor's cannot
assess what impact, if any, this could have on the operations of
iPCS.


K2 INC: Earns $1.5 Million of Net Income in Second Quarter
----------------------------------------------------------
K2 Inc. (NYSE: KTO) reported net sales for the second quarter
ended June 30, 2005 of $301.4 million, an increase of 20% from
$251.0 million in the prior year, as a result of 7.1% in organic
growth and the balance from acquisitions completed after the
second quarter of 2004.

Operating income in the second quarter of 2005 was $8.3 million,
compared to $12.4 million for the 2004 comparable period, and net
income for the 2005 second quarter was $1.5 million, as compared
to $6.2 million for the second quarter of 2004.  As K2 has
forecast for the past 12 months, lower profitability in the second
quarter of 2005 as compared to 2004 is principally attributable to
the acquisitions of Volkl, Marker and Marmot in the third quarter
of 2004, as these product lines have higher levels of fixed
expenses as compared to K2's other business lines, and are
seasonally slow from a sales standpoint in the first and second
quarters.

Net sales for the six month period ended June 30, 2005, were
$619.7 million, an increase of 17% over the 2004 comparable
period, and operating profit for the period was $18.4 million as
compared to $32.0 million for the 2004 six month period.

"We had a solid quarter with over 7% organic growth driven by
strong results in Marine and Outdoor, Team Sports, and Apparel and
Footwear," Richard Heckmann, Chairman and Chief Executive Officer,
said.  "The only category that experienced softness was Action
Sports, due principally to the downturn in the paintball market.
We continued our margin expansion trends, with the gross margin
moving up to 33% versus 31% due largely to an improved
merchandising mix in team sports and apparel and footwear.  Our
new product pipeline continues to deliver, as evidenced by the
introduction of our new Rawlings(R) Coolflo(TM) batting helmet.
As the official batting helmet to Major League Baseball, every
player wears a Rawlings batting helmet and almost 75% of the major
league players in the All Star game wore our new Coolflo(TM)
helmets, and we are confident that our emphasis on product
development will result in continued organic growth."

                     2005 Second Quarter
                  Sales and Profit Results

Comparable Sales Trends

K2's net sales in the second quarter of 2005 were $268.9 million,
excluding net sales of $32.6 million in the aggregate from
businesses acquired by K2 after the 2004 second quarter. K2's net
sales in the second quarter of 2004 were $251.0 million, which
reflects a sales increase of 7.1% in 2005 excluding the impact of
these acquisitions.

Profit Trends

Gross profit as a percentage of net sales in the second quarter of
2005 increased to 33.1%, as compared to 30.8% in the comparable
2004 period. The improvement in the 2005 second quarter was
attributable to higher gross margins in the Team Sports and
Apparel and Footwear segments.

Operating income as a percentage of net sales for the second
quarter of 2005 was 2.8% compared to 5.0% in the comparable 2004
period. Selling, general and administrative expenses were 30.3% of
net sales in the second quarter of 2005 as compared to 25.9% of
net sales in the prior year's second quarter. Higher selling,
general and administrative expenses in the quarter are principally
attributable to the acquisitions of Volkl, Marker and Marmot in
the third quarter of 2004, as these product lines have higher
levels of fixed expenses as compared to K2's other business lines,
and are seasonally slow from a sales standpoint in the first and
second quarters.

                 Second Quarter Segment Review

Due to the acquisitions of Ex Officio and Marmot in the 2004
second and third quarters, respectively, K2 formed an Apparel and
Footwear segment in the 2004 third quarter that also includes
Earth Products.  Earth Products was formerly included in the
Action Sports segment.

Marine and Outdoor

Shakespeare(R) fishing tackle and monofilament, and Stearns(R)
marine and outdoor products, generated net sales of $130.4 million
in the second quarter of 2005, an increase of 21% from the
comparable quarter in 2004.  Sales increases were driven by growth
in water-ski vests, rainwear, inflatables, reels, kits and combos,
antennas and fish line and the acquisitions of All-Star(R) rods
and Hodgman(R) waders during the second quarters of 2004 and 2005,
respectively.

Team Sports

Rawlings, Worth, and K2 Licensing & Promotions had total net sales
of $68.3 million in the 2005 second quarter, an increase of 11%
from the comparable quarter in 2004. The improvement was due to
increases in sales of baseballs, gloves, metal softball bats, team
apparel and the acquisition of Miken(R) softball bats during the
2004 fourth quarter.

Action Sports

In a seasonally slow quarter, net sales of skis, snowboards, in-
line skates, bikes, snowshoes and paintball products totaled $65.1
million in the second quarter of 2005 as compared to $69.2 million
in the 2004 second quarter. The overall sales decline was due to
lower sales of paintball products and snowboards and bikes,
partially offset by net sales from the acquisition of Volkl and
Marker in the 2004 third quarter. The lower profitability in the
second quarter of 2005 as compared to 2004 is principally
attributable to the acquisitions of Volkl and Marker in the third
quarter of 2004, because they are seasonally slow from a sales
standpoint in the first and second quarters.

Apparel and Footwear

Earth Products, Ex Officio and Marmot had net sales of $37.6
million in the second quarter of 2005, an increase of 209% over
the 2004 period. The increase was due to 66% growth in technical
skate footwear and apparel and the acquisitions of Ex Officio on
May 12, 2004 and Marmot on June 30, 2004.

Balance Sheet

K2's balance sheet at June 30, 2005 reflects acquisitions and the
related seasonal working capital requirements of the acquired
businesses.  At June 30, 2005, cash and accounts receivable
increased to $286.3 million as compared to $235.9 million at
June 30, 2004, and inventories at June 30, 2005 increased to
$367.1 million from $212.5 million at June 30, 2004, in each case
primarily as a result of the acquisitions that occurred on or
after June 30, 2004.

K2's total debt increased to $398.9 million at June 30, 2005 from
$200.8 million at June 30, 2004. The increase in debt as of
June 30, 2004 is primarily the result of K2's acquisitions
completed on or after June 30, 2004, including the related
seasonal working capital requirements of the acquired businesses,
and the issuance of $200 million of senior notes in July 2004.

Primarily as the result of the acquisitions of Volkl and Marker,
and Marmot in the third quarter of 2004 and K2's offering of
common stock in the 2004 third quarter, K2 increased its number of
shares of common stock outstanding by 2.8 million shares, 1.8
million shares and 6.4 million shares, respectively, to 46.8
million shares issued and outstanding at June 30, 2005 as compared
to 35.6 million shares outstanding at June 30, 2004.

Cash Flow

At the end of the of the second quarter of 2005, debt, net of
cash, was $377.5 million and the twelve month trailing EBITDA was
$102.5 million, for a ratio of net debt to EBITDA of 3.7 times.

                   Sarbanes-Oxley Act of 2002

Section 404 of the Sarbanes-Oxley Act of 2002 requires K2,
commencing with its 2004 Annual Report, to provide management's
annual report on its assessment of the effectiveness of its
internal control over financial reporting and, in connection with
such assessment, an attestation report from its independent
registered public accountant, Ernst & Young LLP.  In order to
comply with the requirements of Section 404, K2 incurred total
expenses of approximately $2.5 million in 2004, and projects total
expenses of approximately $3.1 million in 2005.

                Pro Forma Adjusted Presentation

K2 Inc. is providing actual results and forecast guidance on a
financial basis in accordance with GAAP, and on a pro forma
adjusted basis that excludes the impact of certain non-cash
expenses including:

   -- amortization of purchased intangibles resulting from K2's
      acquisition activities;

   -- amortization expense associated with the increase in fair
      market values of the inventories of acquired companies;

   -- amortization of capitalized debt costs incurred in
      connection with K2's credit facilities; and

   -- non-cash stock- compensation expense.

In addition, the Pro Forma Adjusted results reflect the pro forma
results of the acquisitions of Volkl, Marker and Marmot as if they
were acquired on Jan. 1, 2004, the pro forma impact of additional
interest expense resulting from K2's issuance of $200 million of
senior notes used for the acquisitions as if the notes were issued
on Jan. 1, 2004, and the pro forma impact of additional shares of
common stock resulting from the acquisitions and K2's equity
offering in July 2004 as if the acquisitions and the equity
offering were completed on January 1, 2004.

On June 30, 2004, K2 acquired Marmot, a premium manufacturer of
technical performance apparel, and on July 7, 2004 acquired Volkl
and Marker, premium manufacturers of alpine skis, bindings and
snowboards.  Due to the seasonality of their product lines, Volkl,
Marker, and Marmot normally incur losses in the first and second
quarters, and are profitable in the last two quarters of the year.

K2's management believes the Pro Forma Adjusted financial measures
for 2004 and 2005, although not indicative of future performance,
are useful for comparison against K2's historical and future
operations.

                        Outlook for 2005

For fiscal year 2005, K2 forecasts GAAP diluted earnings per share
in the range of $0.77 to $0.81 and Pro Forma Adjusted diluted
earnings per share in the range of $0.87 to $0.91, in each case
based on assumed fully diluted shares outstanding of 55.5 million.
For the same period, K2 forecasts GAAP basic earnings per share in
the range of $0.85 to $0.90 and Pro Forma Adjusted basic earnings
per share in the range of $0.96 to $1.01, in each case based on
assumed basic shares outstanding of 46.4 million.

For the third and fourth quarters of 2005, K2 forecasts that the
quarters will be similar to each other in size in terms of net
sales and earnings per share.

K2 Inc. is a premier, branded consumer products company with a
portfolio of leading brands including Shakespeare(R), Pflueger(R)
and Stearns(R) in the Marine and Outdoor segment; Rawlings(R),
Worth(R), and K2 Licensing & Promotions(R) in the Team Sports
segment; K2(R), Volkl(R), Marker(R), Ride(R) and Brass Eagle(R) in
the Action Sports segment; and, Adio(R), Marmot(R) and Ex
Officio(R) in the Apparel and Footwear segment.  K2's diversified
mix of products is used primarily in team and individual sports
activities such as fishing, watersports activities, baseball,
softball, alpine skiing, snowboarding, in-line skating and
mountain biking.  Among K2's other branded products are Hodgman(R)
waders, Miken(R) softball bats, Tubbs(R) and Atlas(R) snowshoes,
JT(R) and Worr Games(R) paintball products, Planet Earth(R)
apparel, Hawk(R) skateboard shoes, and Sospenders(R).

                        *     *     *

As reported in the Troubled Company Reporter on June 22, 2005,
Standard & Poor's Ratings Services revised its outlook on sporting
goods manufacturer K2 Inc. to negative from stable due to
operating challenges that have resulted in slower-than-expected
debt pay down.

At the same time, Standard & Poor's affirmed its 'BB' corporate
credit and senior unsecured debt ratings on the Carlsbad, Calif.-
based company.  Approximately $418 million of debt is affected by
this action.


KEY ENERGY: Reports June 2005 Rig Hours & Select Financial Data
---------------------------------------------------------------
Key Energy Services, Inc. (OTC Pink Sheets: KEGS) reported rig
hours for the month of June 2005 and provided select financial
data for the month ended May 31, 2005.  The Company is providing
this information to investors as part of the consent from the
holders of the Company's 6-3/8% senior notes due 2013 and its
8-3/8% senior notes due 2008.

                   Select Financial Data

                                                  Month Ended
                                                    5/31/05
                                            (In thousands - Unaudited)
    Select Operating Data:
    Revenues
      Well servicing (A)                             $80,215
      Pressure Pumping                                11,507
      Fishing and Rental Services                      6,533
      Other (B)                                       (4,266)
    Total revenues                                   $93,989

    Costs and Expenses
      Well servicing (C)                             $53,141
      Pressure Pumping                                 7,402
      Fishing and Rental Services                      4,592
      General and administrative                      11,873
      Interest (D)                                     6,094

                                                    5/31/05
                                            (In thousands - Unaudited)
    Select Balance Sheet Data:
    Current Assets
      Cash and cash equivalents (E), (F)            $100,739
        Short term investments                        32,850
        Accounts receivable, net of allowance
         for doubtful accounts                       193,058
        Inventories                                   20,206
        Prepaid expenses and other
         current assets                               17,900
    Total current assets                            $364,753

    Current Liabilities
      Accounts payable                                63,603
      Other accrued liabilities                       77,310
      Accrued interest                                 7,300
      Current portion of long-term debt and
       capital lease obligations                       3,791
    Total current liabilities                       $152,004

    Long-term debt, less current portion (G)        $473,773
    Capital lease obligations, less current portion    7,582
    Deferred Revenue                                     458
    Non-current accrued expenses                      38,566


                              NOTES

     (A)  The Well Servicing category includes the financial results of the
          Company's remaining contract drilling assets which are located in
          Argentina, Appalachia and the Powder River Basin of Wyoming.
     (B)  Other revenue includes an estimated loss on the sale of Michigan
          assets of approximately $3,992,000.  This estimate is subject to
the
          ongoing restatement process and, therefore, may be reflected in
2003
          or prior years upon completion of the restatement process.
     (C)  Well Servicing direct expense includes a $4.0 million expense
          associated with a vehicular accident.
     (D)  Interest expense includes amortization of deferred debt issue
costs,
          discount and premium of approximately $165,000 for the month ended
          May 31, 2005.
     (E)  Cash and short term investments at July 19, 2005 totaled
          approximately $99.8 million.
     (F)  Capital expenditures were approximately $10,534,000 for the month
          ended May 31, 2005.
     (G)  There were no outstanding borrowings under the Company's revolving
          credit facility at July 19, 2005.

Key Energy Services, Inc., is the world's largest rig-based well
service company.  The Company provides oilfield services including
well servicing, contract drilling, pressure pumping, fishing and
rental tools and other oilfield services.  The Company has
operations in all major onshore oil and gas producing regions of
the continental United States and internationally in Argentina.

                        *     *     *

As reported in the Troubled Company Reporter on July 11, 2005,
Standard & Poor's Ratings Services revised the CreditWatch
implications on its 'B-' corporate credit rating on Key Energy
Services Inc. to developing from negative.

Houston, Texas-based Key has about $450 million of total debt
outstanding as of June 8, 2005.

The rating action follows the company's announcement that it plans
to enter into a $550 million financing commitment from Lehman
Brothers Inc. that will consist of a $400 million term loan B due
2012, a prefunded five-year $85 million letter of credit, and a
five-year $65 million revolving credit facility.

"The revised CreditWatch implications to developing more
accurately reflects Key's current credit profile," said Standard &
Poor's credit analyst Brian Janiak.


LATHAM MANUFACTURING: Moody's Affirms B2 Rating on $145 Mil. Debts
------------------------------------------------------------------
Moody's Investors Service has affirmed its B2 rating on Latham
Manufacturing Corp's senior secured credit facilities including
the company's planned $20 million term loan B add-on that will
partially fund the announced acquisition of Viking Pools, Inc.

The affirmation of Latham's ratings reflect Moody's expectation
that demand for pools will continue to benefit from the low
interest rate environment and that the recent weakness reflected
in the company's first quarter performance was primarily due to
cold and wet weather in the Northeast.  The affirmation also
considers the expected benefits to be derived from the company's
planned acquisition of Viking Pools which include greater
geographic customer diversification and reduced customer
concentration.  The change to a positive ratings outlook reflects
Moody's belief that the company is well positioned to benefit from
general trends towards greater investment in the home and that the
company's will improve its cash flow generation.

Moody's Investors Service has affirmed these ratings:

   * $40 Million Senior Secured Revolving Credit Facility,
     maturing in 2009, rated B2;

   * $105 Million Senior Secured Term Loan, maturing in 2010,
     rated B2;

   * Corporate Family Rating (previously called the Senior Implied
     Rating), rated B2.

The ratings outlook has been changed to positive from stable.

Proceeds from the $20 million term loan B add-on along with $17
million in subordinated debt (not rated by Moody's) plus some
minimal initial revolver usage, will be combined with $13 million
in equity, including $7 million Viking management rollover, to
fund the $52 million acquisition of Viking and its related
companies at a purchase price multiple of approximately 5 times
the expected EBITDA for FY 2005.

Latham's ratings remain constrained by the company's high leverage
with total debt to capitalization approaching 70% and total debt
to EBITDA that is expected to be around 4 times for FYE 2005.  The
ratings consider the high seasonality of the pool business and the
resulting working capital swings.  Additional volatility in cash
flow generation beyond that caused by the normal seasonal nature
of the business may occur because warm weather stimulates demand
for pools while unexpected cooler or milder weather can reduce
demand for pools and related accessories.  The company's ratings
also consider the potential difficulty in integrating the
company's existing vinyl pool products with Viking's various
fiberglass pool offerings, particularly over the intermediate term
as the company determines the appropriate balance for allocating
its capital expenditure and marketing dollars.

The company's ratings benefit from recurring sales related to its
vinyl liner replacement business and related services.
Additionally, Latham's largest customer also has a large equity
ownership interest in the company thereby reducing the risk that
Latham will lose its most important customer.  The acquisition of
Viking not only allows the company to expand into the faster
growing fiberglass pool segment but also increases the company's
exposure to the faster growing Western United States markets where
demand for pools has been increasing more rapidly than in the
Northern United States.

The positive ratings outlook reflects the belief that the weakness
in demand experienced earlier this year was temporary in nature as
it was weather related and that the Viking acquisition will reduce
future potential negative weather impacts given Viking's
operations that are centered more in the South and Western U.S.
The ratings may be upgraded if the company's free cash flow to
total debt can be consistently sustained above 8% and total debt
to EBITDA is reduced to below 3.7 times.  The outlook could return
to stable if the expected de-leveraging does not materialize over
the next 12 to 18 months.  The ratings would likely deteriorate if
Latham's free cash flow to total debt were to fall below 4% or if
interest coverage was to fall below 2 times.  The ratings may also
deteriorate if the company was to primarily finance new
significant acquisitions entirely with debt.

Latham Manufacturing Corp. is a wholly owned subsidiary of Latham
Acquisition Corp., a company formed by an affiliate of Brockway
Moran & Partners, Inc., and SCP Pool Corp.  The company
manufactures swimming pool components and pool accessories in
North America and has a broad portfolio of leading brands.


LIFECARE HOLDINGS: S&P Junks Proposed $150 Million Senior Notes
---------------------------------------------------------------
Standard & Poor's Ratings Services assigned its 'B' corporate
credit rating to LifeCare Holdings Inc.  The rating outlook is
stable.

In addition, a 'B' bank loan rating and a recovery rating of '2',
indicating the expectation for a substantial (80%-100%) recovery
of principal in the event of a payment default, were assigned to
the company's proposed $330 million senior secured credit facility
due in seven years.  Finally, a 'CCC+' rating was assigned to
LifeCare's proposed $150 million senior subordinated notes due in
eight years.

The company will use the proceeds from the $255 million term note,
$150 million of subordinated debt, and an expected $169 million of
new sponsor equity to fund the sale of the company to The Carlyle
Group.  Pro forma debt outstanding will be about $405 million.

"The low speculative-grade ratings reflect LifeCare's narrow focus
in a competitive business, reimbursement risk (as the company is
heavily reliant on third-party payors), weak cash flow protection
measures, and relatively high debt levels," said Standard & Poor's
credit analyst David Peknay.  "These concerns are only partially
mitigated by LifeCare's relatively large presence in an industry
that has benefited from favorable demographics."

LifeCare is the third-largest operator of long-term acute care
hospitals in a very fragmented industry, operating 21 facilities
in nine states.  Fifteen of its facilities operate a "hospital-
within-hospital" business model, and six are freestanding
facilities.  LifeCare provides treatments for medically complex
conditions having multiple system involvement requiring ongoing
assessment and medical management, such as respiratory conditions
requiring ventilator support, cancer conditions, and infectious
diseases requiring intravenous therapy.  Expansion and improvement
of physician referral relationships and the addition of a modest
number of LTACHs per year through internal development and
possibly acquisitions are among the company's key growth
strategies.


MAGNUM HUNTER: Cimarex Offers to Buy Senior & Convertible Notes
---------------------------------------------------------------
Cimarex Energy Co. (NYSE: XEC) initiated offers to purchase for
cash any and all of its outstanding 9.60% Senior Notes due 2012
and any and all of its outstanding Floating Rate Convertible
Senior Notes due 2023.  The 9.60% Senior Notes and the Convertible
Notes were originally issued by Magnum Hunter Resources, Inc. --
MHR.

On June 7, 2005, a wholly owned subsidiary of Cimarex Energy Co.
merged with and into MHR and as a result, MHR became a wholly
owned subsidiary of Cimarex.  On June 13, 2005, MHR merged with
and into Cimarex, with Cimarex being the surviving company and
assuming all of the obligations of MHR under the notes.  The offer
to acquire the 9.60% Notes and the offer to acquire the
Convertible Notes are each being made to satisfy Cimarex's
contractual obligations under the indentures governing the notes
to offer to repurchase the notes in connection with the mergers.

The offers are scheduled to expire at 5:00 p.m., New York City
time, on August 5, 2005, unless extended.

The 9.60% Notes Offer is to acquire any and all of the $195
million outstanding principal amount of the 9.60% Notes at a
repurchase price equal to 101% of the principal amount of the
9.60% Notes, plus accrued but unpaid interest, up to and including
the third business day after the expiration date of the 9.60%
Notes Offer.  Holders may withdraw their tender from the 9.60%
Notes Offer at any time prior to the withdrawal time for the 9.60%
Notes Offer, which is midnight, New York City time, on August 8,
2005, unless extended.  Specific details of the 9.60% Notes Offer
are fully described in the Change of Control Notice and Offer to
Purchase, dated July 6, 2005, relating to the 9.60% Notes Offer.

The Convertible Notes Offer is to acquire any and all of the
$125 million outstanding principal amount of the Convertible Notes
at a repurchase price equal to 100% of the principal amount of the
Convertible Notes, plus accrued but unpaid interest (including
liquidated damages, if any, payable under the Registration Rights
Agreement entered into in connection with the original offering of
the Convertible Notes), up to, but not including, the expiration
date of the Convertible Notes Offer.  Cimarex does not believe
that any liquidated damages have accrued, and does not expect any
liquidated damages to be payable in connection with the
Convertible Notes Offer.  Holders may withdraw their tender from
the Convertible Notes Offer at any time at or prior to the
expiration time of the Convertible Notes Offer, but not
thereafter.  Specific details of the Convertible Notes Offer are
fully described in the Change in Control Notice and Offer to
Purchase, dated July 6, 2005, relating to the Convertible Notes
Offer.

Deutsche Bank Trust Company Americas is the depositary and the
information agent for the offers.  Requests for assistance or
documentation should be directed to the information agent at:

            c/o DB Services Tennessee, Inc.
            648 Grassmere Park Road
            Nashville, TN 37211
            Attn: Reorganization Unit
            Telephone (800) 735-7777

Beneficial owners of notes may also contact their brokers,
dealers, commercial banks, trust companies or other nominee
through which they hold their notes with questions and requests
for assistance.

                      About Cimarex Energy

Denver-based Cimarex Energy Co. (NYSE: XEC) is an independent oil
and gas exploration and production company with principal
operations in the Mid-Continent, Gulf Coast, Permian Basin and
Gulf of Mexico areas of the U.S. Cimarex's strategy is to increase
shareholder value through a balanced mix of exploration and
development drilling.  Cimarex has a diversified base of drilling
opportunities from lower-risk Mid-Continent and Permian Basin
projects to higher-risk, greater potential prospects in the Gulf
Coast and Gulf of Mexico. Pro forma for the Magnum Hunter
acquisition, year-end 2004 combined proved reserves totaled
1.4 trillion cubic feet equivalent (67% natural gas).

                       About Magnum Hunter

Magnum Hunter Resources, Inc.'s. principal activities are to
acquire, operate, explore, exploit and develop oil and gas
properties.  The Group has interests in 5,612 wells as of
December 2002.  The Group's operations are carried on mainly in
the Mid-Continent Region, Permian Basin and Gulf Coast/Gulf of
Mexico.  The Group also provides drilling, completion, well-site
services, advice regarding environmental and other regulatory
compliance, receipt and disbursement functions, expert witness
testimony and other managerial and petroleum engineering services.
These services are provided to plants located in Texas, Oklahoma,
Mississippi, Louisiana, New Mexico and Kansas.  During the year
2002, the Group acquired Prize Energy Corp.  Exploration and
production accounted for 91% of 2002 revenues; gas gathering,
marketing and processing, 8% and oil field services, 1%.

                         *     *     *

As reported in the Troubled Company Reporter on Feb. 2, 2005,
Moody's placed Magnum Hunter Resource's ratings under review for
possible upgrade, including its B1 senior implied and B2 senior
unsecured note ratings.  MHR's rating outlook had been positive.
This follows MHR's announcement that it will be acquired in an
all-stock transaction by unleveraged Cimarex Energy (unrated).
Cimarex' management will run the merged business.  The merger is
valued at approximately $2.1 billion, with Cimarex assuming MHR's
$645 million of debt as of December 31, 2004.  Cimarex is the
product of the 2002 merger of Key Production and Helmerich and
Paynes's upstream division.

The merger adds a substantial Mid-continent dimension to MHR and
adds a substantial Permian Basin dimension to Cimarex.  There is a
degree of overlap in both firm's Gulf Coast activity.
Importantly, Cimarex management has long been known for a very
conservative leverage philosophy and for its conservative bookings
of proven undeveloped reserves.

As reported in the Troubled Company Reporter on Jan. 28, 2005,
Standard & Poor's Ratings Services placed its 'BB-' corporate
credit and 'B+' senior unsecured ratings on oil and gas company
Magnum Hunter Resources, Inc., on CreditWatch with developing
implications following the company's announcement that it would be
acquired by Denver-based Cimarex Energy Co.

The CreditWatch developing listing indicates that ratings may be
raised, lowered, or affirmed following Standard & Poor's review of
the business and financial policies of the combined entity.

The stock-for-stock transaction, which includes the assumption of
about $645 million of debt, is expected to have a total value of
about $2.1 billion.

As of Sept. 30, 2004, Irving, Texas-based Magnum Hunter had about
$666 million in total debt outstanding, including capital leases
and convertible debt.


MAYTAG CORP: Haier America Withdraws $1.28 Billion Bid
------------------------------------------------------
Bain Capital Partners LLC, Blackstone Management Associates IV
L.L.C. and Haier America Trading, L.L.C. withdrew their $16 per
share all-cash bid to acquire Maytag Corporation (NYSE: MYG).

People close to the situation told the Financial Times that
concerns over price, the complexities of integrating the two
businesses, and fears of political backlash in the U.S. were the
factors behind the decision to withdraw the $1.28 billion bid.

Haier, a privately managed company controlled by the Chinese
government, was uncomfortable with the high-profile political
attention drawn by a Chinese company acquiring an iconic U.S.
company.

                        Two-Corner Fight

Haier's withdrawal leaves the bidding war to Whirlpool Corporation
and Triton Acquisition, a private-equity consortium led by
Ripplewood Holdings.  Whirlpool proposed to acquire Maytag at
$17 per Maytag share.  Triton Acquisition offered to buy Maytag at
$14 per share.

Each bid proposed to assume Maytag's $969 million debt load.

Maytag Corporation is a $4.7 billion home and commercial appliance
company focused in North America and in targeted international
markets.  The corporation's primary brands are Maytag(R),
Hoover(R), Jenn-Air(R), Amana(R), Dixie-Narco(R) and Jade(R).

At Jan. 1, 2005, Maytag's balance sheet reflected a $75,024,000
stockholders' deficit, compared to $65,811,000 of positive equity
at Jan. 3, 2004.

                         *     *     *

As reported in the Troubled Company Reporter on July 21, 2005,
Fitch Ratings placed Maytag Corporation's approximately
$969 million of 'BB' rated senior unsecured notes on Rating Watch
Evolving.

This action followed the July 17, 2005 announcement that Whirpool
Corporation has made a proposal to acquire Maytag for $2.3 billion
in cash and stock and reflects the potential for either an upgrade
or downgrade given the various competing offers for Maytag and the
credit profile that could result.  Whirlpool Corporation has made
a proposal to acquire Maytag for $17 per share plus the assumption
of $969 million of Maytag's debt for a total transaction valued at
$2.3 billion.

This bid follows two other bids: Initially, on May 19, 2005,
Maytag entered into a definitive agreement to be acquired by a
private investor group led by Ripplewood Holdings LLC for $14 per
share cash.  Subsequently, on June 21, 2005, Maytag announced that
it had received a preliminary non-binding proposal from Bain
Capital Partners LLC, Blackstone Capital Partners IV L.P., and
Haier America Trading, L.L.C. to acquire all outstanding shares of
Maytag for $16 per share cash.

As reported in the Troubled Company Reporter on July 20, 2005,
Standard & Poor's Ratings Services placed its 'BBB+' long-term and
'A-2' short-term corporate credit and other ratings on home
appliance manufacturer Whirlpool Corp. on CreditWatch with
negative implications.

At the same time, Standard & Poor's revised its CreditWatch status
of home and commercial appliance manufacturer Maytag Corp. to
developing from CreditWatch negative.

As reported in the Troubled Company Reporter on Apr. 29, 2005,
Moody's Investors Service downgraded Maytag Corporation's senior
unsecured ratings to Ba2 from Baa3 and the short-term rating to
Not Prime from Prime-3.  At the same time the Ba2 senior unsecured
note rating was placed on review for possible further downgrade.
Moody's also assigned a new senior implied rating of Ba2.  Moody's
says the outlook for the ratings remains negative.

The ratings downgraded are:

   * Senior unsecured rating to Ba2 from Baa3; the rating is
     placed on review for possible further downgrade

   * Issuer rating to Ba2 from Baa3,

   * Short term rating to Not Prime from P-3.

The rating assigned:

   * Senior implied rating of Ba2.


MCI INC: NY PSC Staff's Comments on MCI & Verizon Merger
--------------------------------------------------------
On February 25, 2005, Verizon Communications Inc. and MCI, Inc.,
filed a Joint Petition with the New York Public Service
Commission detailing Verizon's proposed acquisition of MCI
pursuant to the Agreement and Plan of Merger.

Verizon and MCI also requested a declaratory ruling that the
Commission lacked jurisdiction to review the merger.

On April 1, 2005, the Commission solicited comments on issues
raised by the MCI and Verizon merger.  About 13 parties submitted
comments.  MCI and Verizon responded to the comments on May 13,
2005.

On July 6, 2005, the staff of the NY Public Service Commission
filed a white paper containing their preliminary analyses and
tentative conclusions about the impact of the MCI/Verizon merger
on New York consumers.

A full-text copy of the Staff's 77-page White Paper is available
for free at: http://bankrupt.com/misc/nypsc_whitepaper.pdf

The Staff tentatively concludes that while the Verizon/MCI merger
will impact the mass market (residential and small business), and
while there is significant mass market intermodal competition
providing voice and data alternatives in most parts of New York,
the Verizon/MCI merger will increase the concentration in that
market.  "While MCI may have been moving out of the local circuit
switching exchange market, there is no evidence of the company's
intent to abandon the overall local telecommunications market."

With respect to the large business (enterprise) and medium size
business markets, the Staff tentatively concludes that the
Verizon/MCI merger will produce significant consolidation and is,
therefore, more troubling.

Moreover, the Staff tentatively concludes that there is no basis
for instituting a rate proceeding in the current competitive
environment.  The Staff notes that Verizon is facing, and will
continue to face, major competition and therefore expecting that
it pass on the synergy-related savings and revenue enhancements to
customers is not necessary and will make it even more difficult
for the company to compete.  "However, we tentatively conclude
that it is reasonable to expect that New York customers will be
insulated from the costs of the merger, including any additional
costs due to Verizon's use of GAAP purchasing accounting to record
the merger.  In addition, New York consumers should be protected
in the event MCI accounting or other improprieties may come to
light should the merger be approved."

                        Verizon's Statement

The New York Public Service Commission staff yesterday issued a
report providing its preliminary analysis and tentative views on
the proposed combination of Verizon and MCI.  The following
statement about the PSC staff report should be attributed to
Thomas McCarroll, Verizon vice president for regulatory affairs in
New York and Connecticut.

"This report from the PSC staff about its preliminary analysis of
our transaction with MCI is an important additional step in
completing the merger approval process in New York.  We are
confident that a complete analysis of the robustly competitive
communications marketplace in New York will bring the PSC to the
conclusion that customers across all market segments will see the
benefits of the combination of Verizon and MCI.  The facts show
that the combination of Verizon and MCI will create a strong new
competitor whose customer focus and commitment will allow us to
better offer innovative new services, packages and products,
particularly to the major businesses now served by MCI, without
negative effects on competition in any aspect of the market.

"We look forward to expeditious approval of the agreement with MCI
by all regulatory authorities, and we are pleased that New York is
headed toward joining those states that have already approved the
transaction."

With more than $71 billion in annual revenues, Verizon
Communications Inc. (NYSE: VZ) is one of the world's leading
providers of communications services.  Verizon has a diverse work
force of 212,000 in four business units:  Domestic Telecom
provides customers based in 28 states with wireline and other
telecommunications services, including broadband.  Verizon
Wireless owns and operates the nation's most reliable wireless
network, serving 45.5 million voice and data customers across the
United States.  Information Services operates directory publishing
businesses and provides electronic commerce services.
International includes wireline and wireless operations and
investments, primarily in the Americas and Europe.  For more
information, visit http://www.verizon.com/

Headquartered in Clinton, Mississippi, WorldCom, Inc., now known
as MCI -- http://www.worldcom.com/-- is a pre-eminent global
communications provider, operating in more than 65 countries and
maintaining one of the most expansive IP networks in the world.
The Company filed for chapter 11 protection on July 21, 2002
(Bankr. S.D.N.Y. Case No. 02-13532).  On March 31, 2002, the
Debtors listed $103,803,000,000 in assets and $45,897,000,000 in
debts.  The Bankruptcy Court confirmed WorldCom's Plan on
October 31, 2003, and on April 20, 2004, the company formally
emerged from U.S. Chapter 11 protection as MCI, Inc. (WorldCom
Bankruptcy News, Issue No. 95; Bankruptcy Creditors' Service,
Inc., 215/945-7000)

*     *     *

As reported in the Troubled Company Reporter on March 1, 2005,
Standard & Poor's Ratings Services placed its ratings on Denver,
Co.-based diversified telecommunications carrier Qwest
Communications International, Inc., and subsidiaries, including
the 'BB-' corporate credit rating, on CreditWatch with negative
implications.  This follows the company's counter bid to Verizon
Communications, Inc., for long-distance carrier MCI, Inc., for
$3 billion in cash and $5 billion in stock.  MCI also has about
$6 billion of debt outstanding.

The ratings on MCI, including the 'B+' corporate credit rating,
remain on CreditWatch with positive implications, where they were
placed Feb. 14, 2005 following Verizon's announced agreement to
acquire the company.  The positive CreditWatch listing for the MCI
ratings reflects the company's potential acquisition by either
Verizon or Qwest, both of which are more creditworthy entities.
However, the positive CreditWatch listing of the 'B+' rating on
MCI's senior unsecured debt assumes no change to the current MCI
corporate and capital structure under an assumed acquisition by
Qwest, such that this debt would become structurally junior to
other material obligations.

"The negative CreditWatch listing of the Qwest ratings reflects
the higher business risk at MCI if its bid is ultimately
successful," explained Standard & Poor's credit analyst Catherine
Cosentino.  As a long-distance carrier, MCI is facing ongoing
stiff competition from other carriers, especially AT&T Corp.
Moreover, MCI is considered to be competitively disadvantaged
relative to AT&T in terms of its materially smaller presence in
the enterprise segment and fewer local points of presence -- POPs.
The latter, in particular, results in higher access costs relative
to AT&T.  Qwest also faces the challenge of integrating and
strengthening MCI's operations while improving its own
underperforming, net free cash flow negative long-distance
business.  These issues overshadow the positive aspects of Qwest's
incumbent local exchange carrier business that were encompassed in
the former developing outlook.

As reported in the Troubled Company Reporter on Feb. 22, 2005,
Moody's Investors Service has placed the long-term ratings of MCI,
Inc., on review for possible upgrade based on Verizon's plan to
acquire MCI for about $8.9 billion in cash, stock and assumed
debt.

These MCI ratings were placed on review for possible upgrade:

   * B2 Senior Implied
   * B2 Senior Unsecured Rating
   * B3 Issuer rating

Moody's also affirmed MCI's speculative grade liquidity rating at
SGL-1, as near term, MCI's liquidity profile is unchanged.

As reported in the Troubled Company Reporter on Feb. 22, 2005,
Standard & Poor's Ratings Services placed its ratings of Ashburn,
Virginia-based MCI Corp., including the 'B+' corporate credit
rating, on CreditWatch with positive implications. The action
affects approximately $6 billion of MCI debt.

As reported in the Troubled Company Reporter on Feb. 16, 2005,
Fitch Ratings has placed the 'A+' rating on Verizon Global
Funding's outstanding long-term debt securities on Rating Watch
Negative, and the 'B' senior unsecured debt rating of MCI, Inc.,
on Rating Watch Positive following the announcement that Verizon
Communications will acquire MCI for approximately $4.8 billion in
common stock and $488 million in cash.


MEGO FINANCIAL: Chapter 11 Trustee Begins a Fishing Expedition
--------------------------------------------------------------
C. Alan Bentley, the chapter 11 trustee of Mego Financial
Corporation dba Leisure Industries of America and its debtor-
affiliates, asks the U.S. Bankruptcy Court for the District of
Nevada for authority to conduct a broad and sweeping examination
pursuant to Rule 2004 of the Federal Rules of Bankruptcy
Procedure.

Mr. Bentley wants these 12 individuals and firms:

          -- Ungaretti & Harris, Ltd.;
          -- Gary Levenstein;
          -- Christopher Boffey;
          -- Friedman, Billings, Ramsey Group, Inc.;
          -- Friedman, Billings, Ramsey & Co. Inc.;
          -- Emmanuel Friedman;
          -- Eric Billings;
          -- Scott Dryer;
          -- BDO Seidman, LLP;
          -- Deloitte & Touche USA, LLP;
          -- Ernst & Young, LLP; and
          -- Singer, Lewak, Greenbaum & Goldstein, LLP

to disclose everything they know about the Debtors' operations,
representation, sale of securities and professional retention
prior to the Debtors' bankruptcy filing.  The Trustee also wants
the parties to turn over all documents regarding their
relationships with the Debtors.

Mr. Bentley states that the probe is relevant and necessary for
him to fully identify assets and pursue claims on behalf of the
estate.

The chapter 11 trustee is represented by three law firms:

        Steven M. Berman, Esq.,
        Berman & Norton Breman
        FL Bar No. 856290
        401 South Florida Avenue, #300
        Tampa, Florida 33602
        Tel: 813-301-0043, Fax: 813-301-0045

        Steven C. Florsheim, Esq.
        Adam P. Merrill, Esq.
        Sperling & Slater, P.C.
        55 West Monroe Street, Suite 3200
        Chicago, Illinois 60603
        Tel: 312-641-3200, Fax: 312-641-6492

        Joan C. Wright, Esq.
        Allison MacKenzie Russell Pavlakis Wright & Fagan,  Ltd.,
        402 North Division Street
        P.O. Box 646
        Carson City, Nevada 89702
        Tel: 775-687-0202, Fax: 775-882-7918

Headquartered in Henderson, Nevada, Mego Financial Corp. --
http://www.leisureindustries.com/-- is in the business of
vacation time share resorts sales and management industry.  The
Company and its debtor-affiliates filed for chapter 11 protection
on July 9, 2003 (Bankr. Nev. Case Nos. 03-52300 through
03-2304).  Stephen R Harris, Esq., at Belding, Harris & Petroni,
Ltd., represents the Debtors in their restructuring efforts.  When
the Company filed for protection from its creditors, it listed
$455,179 in assets and $39,319,861 in liabilities.  Its debtor-
affiliates estimated more than $100 million in assets and
liabilities.  C. Alan Bentley is the chapter 11 Trustee for the
Debtors' estates.


METALFORMING TECH: Look for Bankruptcy Schedules on Aug. 14
-----------------------------------------------------------
Metalforming Technologies, Inc., and its debtor-affiliates ask the
U.S. Bankruptcy Court for the District of Delaware for more time
to file their Schedules of Assets and Liabilities, Statements of
Financial Affairs, Schedules of Current Income and Expenditures,
and Statements of Executory Contracts and Unexpired Leases.  The
Debtors want until Aug. 14, 2005, to file those documents.

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

   1) the considerable number of their creditors and the size and
      complexity of their businesses;;

   2) the diversity of their assets and operations and the limited
      staffing available to gather, process and complete the
      Schedules and Statements; and

   3) the extension will enhance the accuracy of bringing their
      books and records up to date and collecting the data needed
      to prepare and complete the Schedules and Statements.

The Court will convene a hearing at 10:30 a.m., on Aug. 12, 2005,
to consider the Debtors' request.

Headquartered in Chicago, Illinois, Metalforming Technologies,
Inc., and its debtor-affiliates manufacture seating components,
stamped and welded powertrain components, closure systems, airbag
housings and charge air tubing assemblies for automobiles and
light trucks.  The Company and eight of its affiliates, filed for
chapter 11 protection on June 16, 2005 (Bankr. D. Del. Case Nos.
05-11697 through 05-11705).  Joel A. Waite, Esq., Robert S. Brady,
Esq., and Sean Matthew Beach, Esq., at Young Conaway Stargatt &
Taylor, LLP and Michael E. Foreman, Esq., at Proskauer Rose LLP
represent the Debtors in their restructuring efforts.  As of
May 1, 2005, the Debtors reported $108 million in total assets
and $111 million in total debts.


METALFORMING TECH: Committee Taps Mesirow as Financial Advisor
--------------------------------------------------------------
The Official Committee of Unsecured Creditors of Metalforming
Technologies, Inc., and its debtor-affiliates ask the
U.S. Bankruptcy Court for the District of Delaware for permission
to employ Mesirow Financial Consulting LLC as its financial
advisors.

Mesirow Financial will:

   a) assist the Committee in the review of the Debtors' reports
      or filings required by the Court, including their schedules
      of assets and liabilities, statements of financial affairs
      and monthly operating reports;

   b) assist the Committee in the review of the Debtors' financial
      information, including analyses of cash receipts and
      disbursements, financial statement items and proposed
      transactions for which Bankruptcy Court approval is
      required;

   c) review and analyze the Debtors' reports regarding cash
      collateral, DIP financing arrangements and budgets, and
      evaluate potential employee retention and severance plans;

   d) assist in identifying and implementing potential cost
      containment opportunities, asset redeployment opportunities,
      and analyze assumption and rejection issues regarding
      executory contracts and leases;

   e) review and analyze the Debtors' proposed business plans and
      their business and financial condition, their financial
      projections and assumptions, and assist in evaluating
      reorganization strategies and alternatives available to
      creditors

   f) advise and assist the Committee in preparing enterprise,
      asset and liquidation valuations, in negotiations and
      meeting with the Debtors and their bank lenders, and on the
      tax consequences of any proposed plan of reorganization;

   g) assist with the claims resolution procedures, including
      analyses of creditors' claims by type and entity, and in
      litigation consulting services and expert witness testimony
      regarding confirmation issues and avoidance actions; and

   h) perform all other financial advisory services to the
      Committee or its counsel that are necessary in the Debtors'
      chapter 11 cases.

Larry H. Lattig, a member at Mesirow Financial, discloses that his
Firm will be paid with a monthly fee of $50,000, plus out-of-
pocket expenses, to be paid on the first day of every month until
the effective date of a confirmed chapter 11 plan in the Debtors'
bankruptcy cases.

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

Headquartered in Chicago, Illinois, Metalforming Technologies,
Inc., and its debtor-affiliates manufacture seating components,
stamped and welded powertrain components, closure systems, airbag
housings and charge air tubing assemblies for automobiles and
light trucks.  The Company and eight of its affiliates, filed for
chapter 11 protection on June 16, 2005 (Bankr. D. Del. Case Nos.
05-11697 through 05-11705).  Joel A. Waite, Esq., Robert S. Brady,
Esq., and Sean Matthew Beach, Esq., at Young Conaway Stargatt &
Taylor, LLP and Michael E. Foreman, Esq., at Proskauer Rose LLP
represent the Debtors in their restructuring efforts.  As of
May 1, 2005, the Debtors reported $108 million in total assets
and $111 million in total debts.


METRIS COS: Earns $32.5 Million of Net Income in Second Quarter
---------------------------------------------------------------
Metris Companies Inc. (NYSE:MXT) reported net income of
$32.5 million for the quarter ended June 30, 2005.  This compares
to a net loss of $70.3 million for the quarter ended June 30,
2004.

The Company also reported net income of $60.1 million for the six-
month period ended June 30, 2005.  This compares to a net loss of
$28.7 million for the six-month period ended June 30, 2004.

"Our business results have strengthened over the last two years,
and we are encouraged by the level of net income and earnings per
share we posted in the second quarter," said Metris Chairman and
Chief Executive Officer David Wesselink.  "These results reflect
the continued improvements in excess spread, asset quality and our
cash flows, which have allowed us to pay down corporate debt in
the first half of 2005 and invest more heavily in new marketing
programs."

                     Results of Operations

Three Months Ended June 30, 2005 and 2004

Revenues for the quarter ended June 30, 2005 were $179.0 million,
a $152.2 million increase from $26.8 million for the quarter ended
June 30, 2004.  Interest-only revenue increased $41.4 million due
to a 300-basis-point increase in average excess spread, partially
offset by a $1.1 billion decrease in average principal
receivables.  Loss on new securitizations decreased $77.6 million
due to a lower volume of new securitizations and higher excess
spread assumptions used in calculating the loss on new
securitization.  Loss on replenishment decreased $14.3 million
primarily due to higher excess spread assumptions used in
calculating the loss on replenishment. Transaction and other costs
decreased $39.8 million primarily due to fees incurred in 2004
related to establishing a two-year financing conduit.

Six Months Ended June 30, 2005 and 2004

Revenues for the six-month period ended June 30, 2005 were
$329.5 million, a $124.1 million increase from $205.4 million for
the six-month period ended June 30, 2004.  Interest-only revenue
increased $55.3 million due to a 243-basis-point increase in
average excess spread, partially offset by a $1.2 billion decrease
in average principal receivables.  Loss on new securitizations
decreased $49.7 million due to a lower volume of new
securitizations and higher excess spread assumptions used in
calculating the loss on new securitization.  Loss on replenishment
decreased $26.8 million primarily due to higher excess spread
assumptions used in calculating the loss on replenishment.
Transaction and other costs decreased $71.9 million primarily due
to fees incurred in 2004 related to establishing a two-year
financing conduit and commitment fees to insure future asset-
backed transactions.  These improvements were partially offset by
a $47.9 million decrease in the change in fair value of retained
interests in loans securitized.  This decrease was primarily due
to a $73.2 million larger reduction in fair value related to the
change in conduit borrowings and receivable attrition, partially
offset by a $22.4 million larger increase in fair value related to
interest earned on cash balances at the Metris Master Trust and
the release of cash restricted due to performance resulting from
improved Metris Master Trust performance.

                    Metris Master Trust Data

The three-month average excess spread in the Metris Master Trust
was 6.83% as of June 30, 2005, compared to 6.47% for the prior
quarter and 3.83% as of June 30, 2004.  The reported two-cycle
plus delinquency rate in the Metris Master Trust was 7.7% as of
June 30, 2005, compared to 9.2% as of December 31, 2004, and 9.5%
as of June 30, 2004.  The three-month average gross default rate
of the Metris Master Trust was 15.5% as of June 30, 2005, compared
to 17.1% for the prior quarter and 19.2% as of June 30, 2004.

                     Liquidity and Funding

Consolidated total liquid assets were $287.0 million as of
June 30, 2005, representing a $110.1 million decrease from
$397.1 million as of December 31, 2004.  The amount of total
liquid assets held by the parent company and its non-bank
subsidiaries was $193.5 million as of June 30, 2005, and $229.6
million as of December 31, 2004.  The liquidity reserve deposit
held by our bank subsidiary, which is not included in total liquid
assets, was $70.0 million as of June 30, 2005, compared to $79.7
million as of December 31, 2004.

Outstanding corporate debt was $78.6 million as of June 30, 2005,
representing a decrease of $295.0 million from $373.6 million as
of December 31, 2004.  In the second quarter of 2005, the Company
made optional prepayments totaling approximately $246 million on
its senior-secured credit agreement due May 2007 and its Senior
Notes due July 2006, which resulted in approximately $18.2 million
in costs and charges.  As a result of these prepayments, the
Company paid off, in full, its remaining obligations owed under
the senior-secured credit agreement.  Subsequent to June 30, 2005,
the Company made an additional $30 million prepayment on its
Senior Notes due July 2006.

In addition, the Company gave notice on July 13, 2005, of its
intention to make an additional prepayment of $49.1 million, which
is expected to be made on August 15, 2005.  Following the August
prepayment, all of the Company's corporate debt will be
eliminated.

During the quarter ended June 30, 2005, the Company issued
$544 million in series 2005-1 asset-backed securities from the
Metris Master Trust.  Asset-backed funding was $4.8 billion, with
$830 million in unused conduit capacity as of June 30, 2005,
compared to $5.3 billion of asset-backed funding, with $840
million in unused conduit capacity as of December 31, 2004.

Metris Companies Inc. -- http://www.metriscompanies.com/-- based
in Minnetonka, Minn., is one of the largest bankcard issuers in
the United States.  The company issues credit cards through Direct
Merchants Credit Card Bank, N.A. --
http://www.directmerchantsbank.com/-- a wholly owned subsidiary
headquartered in Phoenix, Ariz.

                        *     *     *

As reported in the Troubled Company Reporter on Apr. 15, 2005,
Moody's Investors Service raised the ratings of Metris Companies,
Inc. (senior unsecured to B3 from Caa2) and its bank subsidiary
Direct Merchants Credit Card Bank NA (issuer to Ba3 from B1).  The
rating outlook is stable.  The rating agency said the upgrade
reflects the improvements in Metris's asset quality. These
improvements have led to positive earnings at the company as
well as the release of trapped cash from its securitization
conduits, and have also bolstered ABS investor confidence, giving
the company improved access to the securitization market and
greater funding flexibility.  The ratings action concludes a
ratings review begun on January 13, 2005.


MIRANT CORP: Creditor Panel Taps McKenna Long to Sue Andersen
-------------------------------------------------------------
In anticipation of a complaint to be filed against Arthur
Andersen LLP in Atlanta, the Official Committee of Unsecured
Creditors of Mirant Corp. asks the U.S. Bankruptcy Court for the
Northern District of Texas for permission to retain McKenna Long &
Aldridge LLP as its special litigation counsel effective as of
July 1, 2005.

Jason S. Brookner, Esq., at Andrews Kurth LLP, in Dallas, Texas,
explains that neither counsel for the Mirant Committee or counsel
for the Debtors maintain offices in Atlanta, Georgia.  Since one
of McKenna's offices is located in Atlanta, Georgia, the Mirant
Committee believes that the retention of local counsel,
specifically McKenna, is in the best interest of the estates.

McKenna will serve as the Mirant Committee's local counsel to
assist the Mirant Committee's counsel -- Andrews Kurth LLP and
Shearman & Sterling LLP -- and other professionals that the
Mirant Committee may retain in connection with the impending
Andersen action.

McKenna's attorneys charge $175 to $575 per hour while the firm's
paralegals bill $85 to $195 per hour.

The attorneys primarily responsible for representing the
Committee in litigation against Arthur Andersen are:

       Professional               Hourly Rate
       ------------               -----------
       Charles E. Campbell,          $485
       Gary Marsh                    $380
       Thomas Bosch                  $265

Charles E. Campbell, Esq., a partner at McKenna, attests that the
firm represents no interest adverse to the Debtors or their
estates in the matters on which the firm is to be engaged.
McKenna is "disinterested" as that term is defined in Section
101(14) of the Bankruptcy Code.

Pursuant to Section 1103(a) of the Bankruptcy Code, Judge Lynn
approves McKenna's retention, on an interim basis, effective as
of July 1, 2005.

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


MIRANT CORP: MAGi Panel's Request to Prosecute Claims Draws Fire
----------------------------------------------------------------
Mirant Corporation and its debtor-affiliates, its Official
Committee of Unsecured Creditors and its Official Committee of
Equity Security Holders objected to the request of Mirant Americas
Generation, LLC's Official Committee of Unsecured Creditors for
permission to file and assert the estate's claims against other
Debtor entities and third parties.

As reported in the Troubled Company Reporter on July 1, 2005, the
claims of Mirant Americas against other Mirant debtor entities and
third-parties exceed $1 billion in value, and represent a very
substantial asset to satisfy the MAGi creditors' claims.

             MAGi Panel Has No Derivative Standing,
                         Debtors Allege

Jason D. Schauer, Esq., at White & Case LLP, in Miami, Florida,
relates that the Debtors have been conducting all necessary and
appropriate investigation and analysis with respect to inter-
Debtor claims and estate claims and causes of action against
third parties.  The Debtors have worked closely with the Official
Committee of Unsecured Creditors of Mirant Corp., in formulating
a comprehensive and cost effective strategy to pursue valuable
claims that will inure to the benefit of Mirant Corp. creditors.

In stark contrast, Mr. Schauer notes that the Official Committee
of Unsecured Creditors of Mirant Americas Generation LLC has
taken virtually no interest in determining whether any colorable
MAGi estate claims exist, who the potential defendants would be,
and the cost and expense of litigating the claims.

Mr. Schauer says the Debtors are not surprised at all by the MAGi
Committee's inaction, considering that MAGi's creditors will be
paid in full under the Debtors' Plan of Reorganization.

"However, the [MAGi] Committee is not acting like a committee
whose constituents are being paid in full," Mr. Schauer points
out.  "Rather, the [MAGi] Committee is apparently interested in
commencing all litigation in the hope of obtaining a better
'payment in full' treatment under the Debtors' Plan."

Mr. Schauer maintains that there is absolutely no basis for the
Court to grant the MAGi Committee's request.  The Debtors
recognize the possibility that the Plan will not be confirmed in
its current form.  If it is confirmed, Mr. Schauer notes that the
MAGi creditors will be paid in full and litigation of MAGi estate
Chapter 5 claims is pointless, wasteful, and unjustified.  If the
Plan is not confirmed, MAGi creditors will not be prejudiced
because the Debtors have taken all necessary and appropriate
steps to ensure that the MAGi estate's causes of action are not
jeopardized, like:

    (1) entering into an inter-Debtor tolling agreement that tolls
        all estate claims;

    (2) seeking an order of the Bankruptcy Court to extend the
        applicable limitations periods;

    (3) entering into tolling agreements with third parties,
        including certain former officers and directors; and

    (4) commencing certain identified litigations of significant
        value.

Mr. Schauer believes that there is no reason, under the guise of
concerns regarding statutes of limitation, to re-commence
litigation of estate claims that have already been commenced.
Additionally, the MAGi Committee failed to satisfy the
requirements for derivative standing.

             Creditors Panel Says "It's Just Delay"

The Mirant Committee believes that the MAGi Committee's request
is a mere hollow attempt to further delay confirmation of the
Debtors' Plan, and is a "counterproductive and an unnecessary
distraction."

In the event that the MAGi Committee commences prosecution of
claims against Mirant, the Mirant Committee believes that it will
be forced to prosecute counterclaims against the MAGi estates
based on the massive prepetition value transfers from Mirant to
MAGi, adding to the unnecessary litigation and distraction from
the plan process.

Thus, the Mirant Committee asks the Court deny the MAGi
Committee's request without prejudice to the MAGi Committee's
right to file a motion seeking similar relief in the event that
the Debtors' pending motion to toll certain actions is not timely
granted and the Plan is not confirmed.

               Equity Panel: Request is Premature

The MAGi Committee's assertion as to the necessity of its request
is premature at this juncture, Eric J. Taube, Esq., at Hohmann,
Taube & Summers, L.L.P., in Austin, Texas, points out.

Mr. Taube notes that the Debtors have failed to provide
information to the Official Committee of Equity Security Holders
and the Examiner as to the potential claims and causes of action
which the Debtors' estates may hold against third parties,
including but not limited to, PEPCO, the MIRMA Landlords, Arthur
Andersen, and the present or former officers and directors of the
Debtors.

Mr. Taube adds that the MAGi estates appear to be solvent.  He
notes that the MAGi creditors will be paid in full under the
Debtors' Plan.  Thus, the MAGi Committee's Motion is both
premature and inappropriate and unnecessary.

For these reasons, the Equity Committee asks the Court to deny
the MAGi Committee's request.  To extent the request is granted,
the Equity Committee asks that the order be consistent with its
Objection.

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


NATIONAL CENTURY: Deloitte Inks $4.8 Mil. Settlement with Arizona
-----------------------------------------------------------------
According to published reports, National Century Financial
Enterprises' auditing firm, Deloitte & Touche, has reached a
settlement agreement with Arizona's local government investment
pool.  The auditing firm was accused of misleading the state into
investing taxpayers' money in a financially troubled company in
2002.  The investment was made 13 days prior to National Century's
bankruptcy filing.

The state investment group run by the state Treasury Department
lost $131 million as a result of investing in National Century.

Deloitte agrees to pay the investment group $4.8 million.

The state is also suing Bank One, Credit Suisse and JP Morgan
Chase Bank.

Scottsdale, Chandler, Mesa, Gilbert, Tempe, Apache Junction, Queen
Creek and Paradise Valley are among those which lost money when
National Century went bankrupt.

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.  When it filed for bankruptcy, National Century listed
$3,800,000,000 in assets and $3,600,000,000 in debts.


NORTHWEST AIRLINES: Mediation Board Frees Carrier From AMFA Talks
-----------------------------------------------------------------
Northwest Airlines (Nasdaq: NWAC) confirmed that the National
Mediation Board has released the airline from mediated talks with
The Aircraft Mechanics Fraternal Association union.

Under terms of the federal Railway Labor Act, a thirty-day
"cooling off" period has begun.  It is planned that both parties
will continue labor negotiations with the goal of reaching a new
agreement in advance of a 12:01 a.m. EDT, Aug. 20, 2005, deadline.

"Northwest Airlines wants to continue to work with AMFA
negotiators to reach a consensual agreement that provides wage and
benefit levels that are fair to our employees while allowing
Northwest to stem its record operating losses," said Andrew C.
Roberts, executive vice president-operations.

"Northwest Airlines believes that an end to NMB mediation was
necessary so that a deadline could be established."

"While Northwest wants to reach an expedited agreement with AMFA,
whatever the outcome of negotiations during the next 30 days,
Northwest customers can continue to depend on Northwest to meet
their travel needs.  In preparation for any possible job action,
the airline has developed comprehensive contingency plans,
including expanded vendor relationships and the augmentation of
airline staff, to ensure that Northwest continues to operate
reliably and is able to fly its full schedule," Mr. Roberts said.

                        A Call to Strike

Starting the 30-day countdown to a strike, the union accused the
carrier's executives of recklessly gambling with the company's
future and the public's welfare, and grossly misrepresenting the
impact of a strike.

A strike by AMFA mechanics, cleaners and custodians could begin at
any point after 12:01 a.m. Eastern time on Aug. 20, 2005.  The
union disclosed on Tuesday that an overwhelming 92.4 percent of
its Northwest members voted to authorize AMFA National Director
O.V. Delle-Femine to call a strike.

"Northwest executives gambled recklessly from the start, by
dismissing the whole negotiating process and wasting the NMB's and
our time," Delle-Femine said. "By refusing to budge from their
unreasonable initial offer, they made a consensual agreement
impossible and forced the process toward a strike. Northwest
compounded this arrogance by rejecting the NMB's offer of binding
arbitration in a letter last week on the disingenuous grounds that
'the company is committed to reaching consensual agreement with
AMFA.' How can you reach consensual agreement while refusing to
negotiate? Where is Northwest's counter-proposal to our economic
proposal? There isn't one."

According to Delle-Femine, "AMFA represents eight airlines, and
not even our consensual agreement with bankrupt United Airlines
includes terms as economically devastating as those contained in
Northwest's initial and only proposal." Northwest's proposal seeks
to save about $176 million per year through pay reductions of 25-
26 percent, along with other major concessions. The company
summarily dismissed AMFA's latest offer, which included a 16.1
percent pay cut and other concessions.

Earlier this year, Northwest disclosed that at least $1.1 billion
in annual labor costs savings was necessary for the airline to
restructure successfully.  AMFA's share of this total is
$176 million annually.

AMFA's current proposal offers potential cost reductions of only
$87 million on a temporary basis.  The union's offer calls for
only two years of reductions, with wage rates snapping back to
2005 levels in 2007, regardless of market conditions.

As the result of labor agreements at its major competitors as well
as lower labor costs structures at so-called "low cost carriers,"
Northwest Airlines now has the highest labor costs in the
industry.  "It is imperative that we reach a concessionary labor
agreement with AMFA this year.  Failure to achieve the needed
$176 million in savings from AMFA will leave the airline at
increased financial risk," Mr. Roberts added.

Northwest remains in federal mediation with The International
Association of Machinists and Aerospace Workers and The
Professional Flight Attendants Association.  In addition, it is
continuing contract negotiations with representatives of its other
unions.

Northwest Airlines Corp. is the world's fifth largest airline with
hubs in Detroit, Minneapolis/St. Paul, Memphis, Tokyo and
Amsterdam, and approximately 1,600 daily departures.  Northwest is
a member of SkyTeam, an airline alliance that offers customers one
of the world's most extensive global networks.  Northwest and its
travel partners serve more than 900 cities in excess of 160
countries on six continents.

                        *     *     *

As reported in the Troubled Company Reporter on June 23, 2005,
Moody's Investors Service downgraded the debt ratings of Northwest
Airlines Corporation and its primary operating subsidiary,
Northwest Airlines, Inc.  The Corporate Family Rating (previously
called the Senior Implied rating) was lowered to Caa1 from B2, and
the Senior Unsecured rating was downgraded to Caa3 from Caa1.
Ratings assigned to Enhanced Equipment Trust Certificates were
downgraded.

In addition, the company's Speculative Grade Liquidity Rating was
downgraded to SGL-3 from SGL-2.  The rating actions complete a
review of Northwest's ratings initiated April 8, 2005.  Moody's
said the outlook is negative.

Northwest Airlines Corp.'s common shares closed below $5
yesterday.  The stock was at $11 per share in December.


PASADENA GATEWAY: Court Confirms Amended Plan of Reorganization
---------------------------------------------------------------
The Honorable Jeff Bohm of the U.S. Bankruptcy Court for the
Southern District of Texas in Houston confirmed Pasadena Gateway
Venture, Ltd.'s First Amended Plan of Reorganization on Friday,
July 15, 2005.

As reported in the Troubled Company Reporter on July 6, 2005, the
Plan proposes to pay creditors using proceeds from the sale of
Pasadena's real property to Land Development Company, Ltd.

The Plan proposes to pay in full, on the closing of the sale to
Land Development, all:

     * administrative claims;
     * priority claims;
     * secured tax claims; and
     * unsecured claims.

First Continental Investment Co.'s $460,000 allowed claim will be
paid in full upon closing of the sale of the Debtor's assets.

Beltways Green's secured claim of $5 million in Notes, will be
assumed by Land Development on the closing of the sale of the
Debtor's property.

Equity holders will retain their interests in Reorganized
Pasadena.  Wade Forbes and Barry Goldberg will remain as limited
partners of the Reorganized Debtor.  Mr. Goldberg will act as
Managing Member.

                      Riddle Claim Compromise

An integral part of the Plan is the compromise on the Riddle
Claims.  The Debtor has agreed to pay Mr. Riddle $230,000 to
resolve the claim.

The Debtor was made a third-party defendant to a State Court
lawsuit [Case No. 2003-51526] commenced by John Riddle against
Beltway Green.  Mr. Riddle claims he holds an interest in Beltway
Green and the Debtor's estate.

                          Asset Sale

Land Development will purchase the Debtor's 310-acre land located
in Harris County for $10 million.  On the closing date of the
sale, Land Development will pay $5 million in cash and assume the
$5 million second-lien Beltway Green note.  Pursuant to the Plan,
Land Development is entitled to a $500,000 break-up fee in the
event that the sale is not consummated.

The Debtor purchased the property from Beltway Green Partnership,
Ltd., in 2003 for $7.5 million.  First Continental provided
financing to pay $2.5 million of the purchase price.  The Debtor
issued a second-lien promissory note to pay for the remaining $5
million.

                       Exit Financing

First Continental will provide exit financing in an amount not to
exceed $460,000 on the effective date of the plan.  The amount of
the exit financing will be added to the balance of the First
Continental promissory note.  The total amount owed to First
Continental will accrue interest at 3% over the JP Morgan Chase
Bank Prime Rate.

                     Trust Reserved Claim

Judge Bohm qualifies that the confirmation of the Plan does not
release the Debtor from claims and causes of actions filed by
Robert Taylor, the substitute trustee for the Mary Beth Clawson
1986 Trust, Elizabeth Kathleen Riddle 1986 Trust, and The
Elizabeth Marenfield 1986 Trust (collectively known as the Trust
Parties).

The Trust Parties are contesting ownership of the Debtor's Harris
County asset and had previously sought for the dismissal of the
Debtor's chapter 11 case.  The Debtor filed for bankruptcy to
protect itself from this litigation.

Headquartered in Houston, Texas, Pasadena Gateway Venture, Ltd.,
filed for chapter 11 protection on April 3, 2005 (Bankr. S.D. Tex.
Case No. 05-34900).  Marilee A Madan, Esq., at Russell & Madan,
P.C., represents the Debtor.  When the Debtor filed for protection
from its creditors, it reported estimated assets of $10 million to
$50 million and estimated debts of $1 million to $10 million.


PASTA GARDEN: Case Summary & 15 Largest Unsecured Creditors
-----------------------------------------------------------
Debtor: Pasta Garden, L.L.C.
        3 Port Au Spain
        Hilton Head Island, South Carolina 29928

Bankruptcy Case No.: 05-08147

Type of Business: The Debtor operates a restaurant located in
                  Hilton Head Island, South Carolina.

Chapter 11 Petition Date: July 19, 2005

Court: District of South Carolina (Charleston)

Judge: John E. Waites

Debtor's Counsel: Kevin Campbell, Esq.
                  Campbell Law Firm, P.A.
                  P.O. Box 684
                  890 Jonnie Dodds Boulevard
                  Mt. Pleasant, South Carolina 29465
                  Tel: (843) 884-6874

Estimated Assets: $0 to $50,000

Estimated Debts:  $1 Million to $10 Million

Debtor's 15 Largest Unsecured Creditors:

   Entity                                   Claim Amount
   ------                                   ------------
Romano Group Development LLC                     $72,400
24 Woodbine Place
Hilton Head Island, SC 29928

Rosalinda Collinet                               $65,000
15 Park Lane
Hilton Head Island, SC 29928

Kitchen Equipment Supply Depot                   $48,845
29 Kitties Landing Road
Blufton, SC 29910

Sysco                                            $28,000
131 Sysco Court
Columbia, SC 29206

John Andunis                                     $19,000
Distinctive Granite And Marble
33 Hunter Road
Hilton Head Island, SC 29929

Beaufort County Treasurer                        $16,240
P.O. Drawer 487
Beaufort, SC 29901

Rewards Network                                   $5,758
11900 Biscayne Boulevard, Suite 460
North Miami, FL 33181

Walt Heating and Air                              $4,800
21 Dillon Road
Hilton Head Island, SC 29928

Central Park Owners Association                   $3,009
13 Park Lane
Hilton Head Island, SC 29928

W.H.H.I.                                          $3,000
32 Office Park Road, Suite 103
Hilton Head Island, SC 29928

Hilton Head Restaurants Magazine                  $3,000
P.O. Box 6836
Hilton Head Island, SC 29938

Hobart                                            $1,124
13 West Gate Road
Savannah, GA 31405

Data Publishing/ The Community Phone Bk.            $972
File 41248
Los Angeles, CA 90074

Fire Tech Services, Inc.                            $502
70 Capital Drive
Hilton Head Island, SC 29926

Phipps & Geis, P.A.                                 $400
430 William Hilton Parkway, Suite 505
Hilton Head Island, SC 29926


PENINSULA HOLDINGS: Section 341(a) Meeting Continues on Aug. 16
---------------------------------------------------------------
The United States Trustee for Region 18 will continue the meeting
of Peninsula Holding Company LLC's creditors at 1:30 p.m., on
Aug. 16, 2005, at:

         The United States Courthouse
         700 Stewart Street, Suite 4107
         Seattle, Washington

The Section 341(a) meeting originally scheduled on July 13, 2005
was not concluded after the Debtor's principal, Douglas Brown,
failed to personally appear.

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

Headquartered in Seattle, Washington, Peninsula Holding Company
LLC, develops raw land projects in Shelton, Washington.  The
Company filed for chapter 11 protection on May 19, 2005 (Bankr.
W.D. Wash. Case No. 05-16571). Charles A. Johnson, Jr., Esq., at
the Law Offices of Charlie Johnson, represents the Debtor in its
restructuring efforts.  When the Debtor filed for protection from
its creditors, it listed total assets of $42,900,000 and total
debts of $31,432,554.


PHOTOWORKS INC: Shareholders Okay 1-for-5 Reverse Stock Split
-------------------------------------------------------------
PhotoWorks(R), Inc.'s shareholders approved amendments to the
articles of incorporation for a 1-for-5 reverse stock split during
the annual meeting of shareholders.  The reverse split became
effective at the close of business on July 18, 2005.

Immediately before the reverse split, PhotoWorks had 101,250,000
shares of common stock authorized, of which 18,451,875 shares of
common stock were outstanding.  As a result of the reverse split,
PhotoWorks has 101,250,000 authorized shares of common stock, of
which approximately 3,690,375 shares are outstanding, pending the
calculation of fractional-share payments.  The Articles of
Amendment did not affect the number of authorized and outstanding
shares of PhotoWorks' preferred stock.  As a result of the reverse
split, the conversion ratios of the Series A Preferred Stock and
the Company's two series of outstanding Subordinated Convertible
Debentures were adjusted to reflect the reverse split.

On June 28, 2005, the Board of Directors of the Company adopted a
resolution authorizing the amendment of the Company's Shareholder
Rights Plan.  This amendment was executed on July 7, 2005 by
PhotoWorks and the Rights Agent and the Rights Plan terminated on
July 15, 2005.

                   Recapitalization Agreements

As reported in the Troubled Company Reporter on July 1, 2005,
PhotoWorks successfully secured shareholder approval of its
recapitalization agreements.  The comprehensive plan negotiated
with the holders of the subordinated debt and holders
of the preferred shares results in a $2 million cash infusion
of equity strengthening the company's balance sheet.

In addition, the agreement calls for the conversion of
$4.5 million of interest bearing debt to common stock and the
conversion of the Series A Preferred Stock with its $20 million
liquidation preference into common stock.  A five-for-one reverse
stock split was also approved, a move that is aimed at increasing
the marketability and liquidity of the company's common stock.

PhotoWorks(R), Inc. (OTCBB:FOTO) -- http://www.photoworks.com/--
is an online photography services company.  With a 25-year
national heritage (formerly known as Seattle FilmWorks),
PhotoWorks helps photographers -- both film and digital -- share
and preserve their memories with innovative and inspiring products
and services.  Every day, photographers send film, memory cards
and CDs, or go to http://www.photoworks.com/to upload, organize
and email their pictures, order prints, and create Signature Photo
Cards and Custom Photo Books.  Offering a 100% satisfaction
guarantee, PhotoWorks has been awarded an "Outstanding" rating by
The Enderle Group technology analysis firm.

At Mar. 26, 2005, PhotoWorks Inc.'s balance sheet showed a
$1,734,000 stockholders' deficit, compared to a $536,000 deficit
at Sept. 25, 2004.


PRIME CAMPUS: UST & Varde Fund Want Case Converted or Dismissed
---------------------------------------------------------------
The U.S. Trustee for Region 7 and Varde Fund, L.P., ask the U.S.
Bankruptcy Court for the Northern District of Texas, Lubbock
Division, to convert the chapter 11 case of Prime Campus Housing,
LLC, into a chapter 7 liquidation proceeding.  In the alternative,
the U.S. Trustee asks the Court to dismiss the Debtor's case.

Varde Fund, the largest secured creditor of Prime Campus, asserts
a $10.9 million claim against the Debtor's estate.  The claim is
secured by a first-priority lien upon all of the Debtor's assets
consisting of commercial and residential property in Lubbock.

On April 15, 2005, the Court approved the Debtor's use of Varde
Fund's cash collateral until July 31, 2005.

On June 20, 2005, the Court granted Varde Fund's request to lift
the automatic stay.  As a result, Varde Fund foreclosed on its
collateral on July 5.  After the lender sold the foreclosed
property, it still holds a deficiency claim of $5.4 million.

According to Varde Fund, the Debtor's remaining asset after the
foreclosure, is a claim against the lender asserting equitable
subordination and seeking a declaration from the Court to
recharacterize all of the lender's liens as equity.  The lender
contends the claim can be best administered under chapter 7.  A
chapter 7 trustee can very quickly evaluate whether the claim has
any merit, Varde Fund says.

In a separate application, the U.S. Trustee reiterates the facts
presented by Varde Fund.  The U.S. Trustee believes a dismissal or
conversion to a chapter 7 proceeding is in the best interests of
all parties-in-interest.

As previously reported in the Troubled Company Reporter on June
20, 2005, Prime Campus blames Varde for many of its woes and has
asked Judge Jones to disallow Varde's secured claim.

David Weitman, Esq., and Daniel I. Morenoff, Esq., at Hughes &
Luce, LLP, Varde's counsel, tell Judge Jones there's a long list
of promises Prime Campus has made and broken, and the Debtors'
problems are of its own making.

Headquartered in Omaha, Nebraska, Prime Campus Housing, LLC,
operates a 1,017-bed coeducational full-service dormitory located
in Lubbock County, Texas.  Prime Campus filed for chapter 11
protection on March 21, 2005 (Bankr. N.D. Tex. Case No. 05-50311).
Joseph F. Postnikoff, Esq., at Goodrich, Postnikoff & Albertson
represents the Debtor in its restructuring efforts.  When the
Company filed for protection from its creditors, it listed total
assets of $15,963,311.54 and total debts of 11,090,311.54


PLEASANT VIEW: Voluntary Chapter 11 Case Summary
------------------------------------------------
Debtor: Pleasant View Condominiums, Inc.
        100 Wingate Drive
        Pittsburgh, Pennsylvania 15205

Bankruptcy Case No.: 05-29324

Type of Business: The Debtor owns and operates a condominium
                  located in Pittsburgh, Pennsylvania.

Chapter 11 Petition Date: July 20, 2005

Court: Western District of Pennsylvania (Pittsburgh)

Debtor's Counsel: Robert O. Lampl, Esq.
                  Law Office of Robert O. Lampl
                  960 Penn Avenue, Suite 1200
                  Pittsburgh, Pennsylvania 15222
                  Tel: (412) 392-0330
                  Fax: (412) 392-0335

Estimated Assets: $1 Million to $10 Million

Estimated Debts:  $1 Million to $10 Million

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


QUEEN'S SEAPORT: Exclusive Plan Filing Period Intact Until Oct. 14
------------------------------------------------------------------
The Honorable Vincent P. Zurzolo of the U.S. Bankruptcy Court for
the Central District of California, Los Angeles Division, extended
until October 14, 2005, Queen's Seaport Development LLC's
exclusive period to file a chapter 11 plan.  The Court also
extended, until December 15, 2005, the Debtor's exclusive period
to solicit acceptances of that plan.

Headquartered in Long Beach, California, Queen's Seaport
Development, Inc., -- http://www.queenmary.com/-- operates the
Queen Mary ocean liner, various attractions and a hotel.  The
Company filed for chapter 11 protection on March 15, 2005 (Bankr.
C.D. Calif. Case No. 05-15175).  When the Debtor filed for
protection from its creditors, it listed estimated assets and
debts of $10 million to $50 million.


QUIGLEY COMPANY: Asks Court for Extension to Remove Civil Actions
-----------------------------------------------------------------
Quigley Company, Inc., asks the U.S. Bankruptcy Court for the
Southern District of New York to extend, until Nov. 7, 2005, the
time within which it can remove pending civil actions from
numerous courts to the Southern District of New York for continued
litigation.

Quigley was first named as a defendant in asbestos-related
personal injury claims in 1979 or 1980.  Although Quigley ceased
manufacturing any products containing asbestos in the 1970s and
closed its refractories business in 1992, it had been named as a
defendant in approximately 433,700 personal injury claims in
approximately 149,000 civil actions brought in federal and state
courts throughout the United States.  As of the petition date,
there were approximately 162,700 personal injury claims, including
4,600 silica-related personal injury claims, pending against
Quigley in approximately 59,150 civil actions.

At the time of Quigley's chapter 11 filing, the company's
principal business was managing the defense and resolution of the
personal injury claims brought against it.

Lawrence V. Gelber, Esq., at Schulte Roth & Zabel LLLP, in New
York, New York explains that it is prudent at this stage of
Quigley's case to seek an additional extension of the deadline to
remove the prepetition civil actions.  Mr. Gelber reminds the
Court that Quigley filed a plan of reorganization and related
disclosure statement on March 4, 2005.  Since that time, Quigley
has been involved in extensive negotiations and exchanges of
information with the interested parties, including Pfizer, the
Committee and the Futures Representative, aimed at reaching
consensus on the terms of the plan, the establishment of a trust
under sections 105(a) and 524(g) of the Bankruptcy Code and the
procedures to govern distributions by the trust.

In addition, Quigley and its professionals have been working
closely with the Committee's and the Representative's
professionals to complete the various expert valuations and
estimations necessary for Plan confirmation.  Quigley thus needs
additional time to review its pending nonpersonal injury
litigation to determine whether it makes sense to remove some or
all of those actions to federal court.

Mr. Gelber states that the extension sought will:

   a) allow Quigley and its professionals a chance to make fully
      informed decisions concerning the removal of each
      Prepetition Civil Action; and

   b) will assure that Quigley does not forfeit valuable rights
      afforded it under Section 1452.

Furthermore, the rights of Quigley's adversaries in the
prepetition civil actions will not be prejudiced by this
extension, because any party to a removed action may seek remand
pursuant to 28 U.S.C. Section 1452(b).

                          Plan Progress

As reported in the Troubled Company Reporter on May 3, 2005,
Quigley delivered a chapter 11 plan of reorganization to the Court
that will create an Asbestos Personal Injury Trust crafted under
11 U.S.C. Sec. 524(g) to resolve all asbestos-related
claims.  Pfizer, Inc., Quigley's sole shareholder, agreed to
contribute $405 million to the Asbestos Settlement Trust over 40
years through a note, contribute approximately $100 million in
insurance, and forgive a $30 million loan to Quigley.

Headquartered in Manhattan, Quigley Company is a subsidiary of
Pfizer, Inc., which used to produce and market a broad range of
refractories and related products to customers in the iron, steel,
glass and other industries.  The Company filed for chapter 11
protection on Sept. 3, 2004 (Bankr. S.D.N.Y. Case No. 04-15739) to
resolve legacy asbestos-related liability. When the Debtor filed
for protection from its creditors, it listed $155,187,000 in total
assets and $141,933,000 in total debts.  Michael L. Cook, Esq., at
Schulte Roth & Zabel LLP, represents the Company in its
restructuring efforts.  Albert Togut, Esq., at Togut Segal & Segal
serves as the Futures Representative.


RASC: Reduced Credit Support Cues S&P to Cut Class M Rating to BB
-----------------------------------------------------------------
Standard & Poor's Ratings Services lowered its rating on class M-
I-3 from RASC Series 2001-KS2 Trust to 'BB' from 'BBB'.
Concurrently, ratings on the remaining classes from the same
transaction are affirmed.

Class M-I-3 is backed by the fixed loan group from RASC 2001-KS2.
The lowered rating on this class reflects a decrease in credit
support due to realized losses from the fixed loan group,
resulting in a regular erosion of the available credit support for
this class.  Realized losses from this loan group have exceeded
excess interest for the past 12 months, resulting in an
overcollateralization (o/c) level that is below its target.
During this period, realized losses have averaged $919,823, while
excess interest has averaged $465,843 per month.  In addition, the
delinquency trigger allowed the o/c target level to step down to
2.50% of the current pool balance.  Class M-I-3 currently has o/c
of 2.19% compared to its current target of 2.50% of the current
pool balance.

While the mortgage pool has paid down to approximately 20.25% of
its original balance, substantial losses and delinquencies
continue to deteriorate collateral performance.  As of the June
distribution date, cumulative realized losses were 3.94% of the
original pool balance, while total delinquencies were 29.48%.
Serious delinquencies (90-plus day delinquencies, foreclosure, and
real estate owned) were 21.17%.

Despite collateral performance that is worse than originally
expected, the affirmed ratings on the remaining classes reflect
adequate credit support to protect the classes from losses at
their respective rating levels.  The transaction will continue to
be monitored closely and ratings will be adjusted accordingly.

RASC Series 2001-KS2 Trust is made up of two groups of subprime
collateral mortgage loans. Loan group I consists of 30-year fixed-
rate, first lien mortgage loans secured by one-to-four-family
residential properties.  Loan group II consists of 30-year
adjustable-rate mortgage loans secured by one-to-four-family
residential properties.

                          Rating Lowered

                   RASC Series 2001-KS2 Trust

                                 Rating
                                 ------
                      Class    To      From
                      -----    --      ----
                      M-I-3    BB      BBB

                         Ratings Affirmed

                   RASC Series 2001-KS2 Trust

                        Class      Rating
                        -----      ------
                        A-I-5      AAA
                        A-I-6      AAA
                        A-II       AAA
                        M-I-1      AA
                        M-II-1     AA
                        M-I-2      A
                        M-II-2     A
                        M-II-3     BBB


RHODES INC: Court Okays Store Closing Sales & Agency Agreement
--------------------------------------------------------------
The U.S. Bankruptcy Court for the Northern District of Georgia
approved Rhodes Inc., and its debtor-affiliates' request to:

   a) close 15 stores and those stores' support operations located
      in several Midwestern states;

   b) conduct store closing sales to liquidate merchandise
      inventory and other assets (including furniture, equipment
      and trade fixtures) free and clear of liens, claims
      and interest pursuant to Sections 363(b) and (f) of the
      Bankruptcy Code; and

   c) enter into an Agency Agreement providing for the
      liquidation of the merchandise inventory and other assets
      and granting the Liquidating Agent liens pursuant to Section
      364(d) of the Bankruptcy Code.

The Debtors believe that liquidating the merchandise and other
assets located in the 15 stores and then closing those stores will
enhance the value of their remaining business operations and
maximize the return to the creditors of their chapter 11 cases.

The Debtors estimate that the Merchandise and other assets
located in the 15 stores is about $13.3 million.

                      The Agency Agreement

Prior to the filing of their request, the Debtors negotiated an
Agency Agreement with a joint venture comprised of:

     -- The Pride Capital Group, LLC,
     -- Gordon Brothers Retail Partners, LLC,
     -- Professional Sales and Consulting Company, and
     -- Zimmer-Hester, Inc.,

to serve as their initial Liquidating Agent to assist them in
conducting the store closing sales.

The Agency Agreement has an overbidding procedure, which provides
that in event of a successful overbid in an auction, the party or
overbidder who submits a higher or better bid will become the
alternative Liquidating Agent and will conduct the store closing
sales.

That provision means that the Debtors will solicit offers from
competing bidders in an open auction who wish to liquidate the
Merchandise and the furniture, equipment and trade fixtures, or to
assist the Debtors in liquidating those assets.

The Agreement also provides for the payment of a $300,000 Break-Up
Fee to the initial Liquidating Agent in event of a successful
overbid, and a limited overbid protection to that Agent.  The
overbid protection requires that any competing bids provide for a
Guaranteed Amount of at least the Break-Up Fee, plus 0.5% above
the Guaranty Percentage required in the Agency Agreement.
Subsequent bids will be increased by increments of at least 0.5%
over the immediately preceding bid.

Objections to the Debtors' request must be filed and served by
10:00 a.m. today, Friday, July 22, 2005.

The auction of the assets for sale will commence today, Friday, at
11:00 a.m., on July 22, 2005, at the offices of King & Spalding
LLP, 191 Peachtree Street, 49th Floor, Atlanta, Georgia.

The Court will convene a final sale hearing at 3:00 p.m., on
July 26, 2005, to approve the Debtors' sale request.

Headquartered in Atlanta, Georgia, Rhodes, Inc., will continue to
offer brand-name residential furniture to middle- and upper-
middle-income customers through 63 stores located in 11 southern
and midwestern states (after disposing of the locations listed
above).  The Company and two of its debtor-affiliates filed for
chapter 11 protection on Nov. 4, 2004 (Bankr. N.D. Ga. Case No.
04-78434).  Paul K. Ferdinands, Esq., and Sarah Robinson Borders,
Esq., at King & Spalding represent the Debtors in their
restructuring efforts.  When the Debtors filed for protection from
their creditors, they estimated less than $50,000 in assets and
more than $10 million in total debts.


R.J. REYNOLDS: 62% of Noteholders Tender 7-3/4% Notes Due 2006
--------------------------------------------------------------
R.J. Reynolds Tobacco Holdings, Inc., a wholly owned subsidiary of
Reynolds American Inc. (NYSE:RAI) disclosed that its tender offer
and related consent solicitation for any and all of its
outstanding 7-3/4% Notes due 2006 expired at 12:00 midnight, New
York City time, on July 19, 2005.

A total of approximately $309.8 million in principal amount, or
62%, of the $500 million in aggregate principal amount of
outstanding Notes, were tendered on or prior to the Expiration
Date.  RJR has accepted for payment all of the Notes tendered in
the tender offer, and expects to pay for any tendered Notes that
were not previously settled.  The tender offer and the related
consent solicitation to amend the indenture governing the Notes
are described in the Offer to Purchase and Consent Solicitation
Statement dated June 21, 2005.

                     Consent Solicitation

In conjunction with the tender offer, consents were solicited to
eliminate substantially all of the restrictive covenants and one
of the events of default contained in the indenture governing the
Notes.  As previously announced, after receipt of the requisite
number of consents to amend the indenture and the satisfaction of
the other conditions to the adoption of the proposed amendments to
the indenture, The Bank of New York, as trustee under the
indenture, RJR as issuer, and RAI and the other guarantors of the
Notes entered into, on July 6, 2005, a supplemental indenture
effecting the amendments.

RJR is financing the payment for Notes tendered pursuant to the
tender offer with the proceeds from its private offering of
$300 million in aggregate principal amount of 6.50% Secured Notes
due 2010 and $200 million aggregate principal amount of 7.30%
Secured Notes due 2015, which closed on June 29, 2005.

Citigroup Global Markets Inc. and J.P. Morgan Securities Inc.
acted as the dealer managers and solicitation agents for the
tender offer and consent solicitation, and Global Bondholder
Services Corporation acted as the information agent.  This
announcement is not an offer to purchase, a solicitation of an
offer to purchase, or a solicitation of consents with respect to
the Notes, nor is this announcement an offer to sell or a
solicitation of an offer to buy new securities of RJR.

Based in Winston-Salem, North Carolina, Reynolds American is the
parent company of RJR Tobacco Company, the second largest
cigarette company in the United States.

                        *     *     *

As reported in the Troubled Company Reporter on June 24, 2005,
Standard & Poor's Ratings Services assigned its 'BB+' rating to
Winston-Salem, North Carolina-based RJ Reynolds Tobacco Holdings
Inc.'s $500 million senior secured notes in two tranches due 2010
and 2015.

At the same time, Standard & Poor's affirmed its ratings on the
company, including its 'BB+' corporate credit rating.  S&P said
the ratings outlook is negative.  About $1.6 billion of total debt
was outstanding at parent company, Reynolds American Inc. at
March 31, 2005.

Moody's Investors Service assigned a Ba2 rating to the new senior
secured notes maturing in 2010 and 2015 issued by R.J. Reynolds
Tobacco Holdings, Inc., and affirmed all the existing ratings of
RJRT.  RJRT is a 100%-controlled subsidiary of Reynolds American,
Inc.  The outlook remains negative.

Ratings assigned:

  RJRT:

   * Ba2 for backed senior secured notes maturing 2010
   * Ba2 for backed senior secured notes maturing 2015


SAINT VINCENTS: Asks Court to Deem Utilities Adequately Assured
---------------------------------------------------------------
Stephen B. Selbst, Esq., at McDermott Will & Emery LLP, in New
York, tells the U.S. Bankruptcy Court for the Southern District of
New York that Saint Vincents Catholic Medical Centers of New York
and its debtor-affiliates obtain water, heat, natural gas, oil,
electricity, trash removal, sewage, telephone, and other utility
services from 40 utility companies.

Section 366 of the Bankruptcy Code bars the utility companies from
discontinuing service to the Debtors solely on the basis of the
bankruptcy filing or failure to pay prepetition debt within 20
days after the Petition Date.

Mr. Selbst avers that, if the utility companies were permitted to
terminate services after the expiration of the 20-day period, the
Debtors would be unable to operate, causing potential life-
threatening hazards for their patients and employees.  To avoid
cessation of the services, the Debtors would be required to pay
potentially substantial sums demanded by the utility companies.

Mr. Selbst notes that the "adequate assurance" necessary under
Section 366 is neither synonymous with "adequate protection" nor
with a guarantee of payment.  In determining adequate assurance,
the Court is not required to give the utility companies the
equivalent of a guaranty of payment, but only to determine that
the utility is not subject to an unreasonable risk of non-payment
for postpetition services.

The Debtors acknowledge that they may not have been current with
their prepetition obligations.  Nonetheless, the Debtors represent
that they will pay their postpetition utility charges as billed
and when due.  Together with the cash generated by operations, Mr.
Selbst says the postpetition financing arrangements sought by the
Debtors will enable them to pay their postpetition debts as they
become due.  The Debtors included charges for future utility
service in the projected budgets prepared in connection with the
financing arrangements.

Mr. Selbst relates that requiring the Debtors to provide security
deposits to each utility company would cause liquidity problems
and could impede their ability to reorganize.  Negotiations with
each of the numerous utility companies would waste time and money
better devoted to the Debtors' reorganization efforts.

At the Debtors' behest, the Court enjoins and prohibits utility
companies from altering, refusing, or discontinuing services to
the Debtors.

Judge Beatty finds that the Debtors' ability to pay the utility
companies for postpetition utility services and the utility
companies' entitlement to an administrative expense priority
under Section 507(a)(1) of the Bankruptcy Code for unpaid
postpetition charges constitute adequate assurance to the utility
companies of payment for future utility services in accordance
with Section 366(b) -- without the need for payment of a deposit
or other security.

The Order is without prejudice to the rights of any of the
utility companies to request, until August 3, 2005, additional
assurances of payment in the form of deposits or other security.

To the extent that the Debtors are unable to resolve a timely
request for additional adequate assurances, then the utility
companies may file a request for determination of adequate
assurance of payment.  Nothing in the Order will be deemed to
affect any burden of proof of either the Debtors or any utility
company at a Determination Hearing.

Pending a Determination Hearing, any objecting utility companies
will be deemed to have received adequate assurance of payment
until a Court order is entered in connection with the
Determination Hearing.

Any utility company that does not timely request additional
adequate assurance will be deemed to have received adequate
assurance under Section 366.

A list of the utility companies identified by the Debtors is
available free of charge at:

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

Headquartered in New York, New York, Saint Vincents Catholic
Medical Centers of New York -- http://www.svcmc.org/-- the
largest Catholic healthcare providers in New York State, operate
hospitals, health centers, nursing homes and a home health agency.
The hospital group consists of seven hospitals located throughout
Brooklyn, Queens, Manhattan, and Staten Island, along with four
nursing homes and a home health care agency.  The Company and six
of its affiliates filed for chapter 11 protection on July 5, 2005
(Bankr. S.D.N.Y. Case No. 05-14945 through 05-14951).  Gary
Ravert, Esq., and Stephen B. Selbst, Esq., at McDermott Will &
Emery, LLP, represent the Debtors in their restructuring efforts.
As of Apr. 30, 2005, the Debtors listed $972 million in total
assets and $1 billion in total debts.  (Saint Vincent Bankruptcy
News, Issue No. 04; Bankruptcy Creditors' Service, Inc., 215/945-
7000)


SAINT VINCENTS: Lynn Marziale Wants Court to Lift Automatic Stay
----------------------------------------------------------------
Lynn Marziale, administrator of the estate of Luke M. Parlatore,
asks the Court to modify the automatic stay under Section 362 of
the Bankruptcy Code to allow her to continue with her personal
injury action against Saint Vincents Catholic Medical Centers of
New York and its debtor-affiliates in the New York Supreme Court.

The lawsuit seeks to recover for the wrongful death and pre-death
pain and suffering of Mr. Parlatore allegedly caused by medical
malpractice committed by agents and employees of Saint Vincent
Catholic Medical Center of Richmond, in Staten Island, New York.
Mr. Parlatore was admitted to the Hospital on January 5, 2002, and
remained an inpatient until his demise 22 days later.

Bradley A. Sacks, Esq., in New York, assures the Court that the
request will not prejudice or burden the Debtors or their
creditors.  The claims sought in the lawsuit are covered by
insurance policies issued by the Medical Liability Mutual
Insurance Co., with available policy limits of $1 million per
occurrence and $8 million per policy year.  Ms. Marziale is
willing to proceed solely against the insurance coverage to
recover any sum awarded by the jury against the Debtors.

Headquartered in New York, New York, Saint Vincents Catholic
Medical Centers of New York -- http://www.svcmc.org/-- the
largest Catholic healthcare providers in New York State, operate
hospitals, health centers, nursing homes and a home health agency.
The hospital group consists of seven hospitals located throughout
Brooklyn, Queens, Manhattan, and Staten Island, along with four
nursing homes and a home health care agency.  The Company and six
of its affiliates filed for chapter 11 protection on July 5, 2005
(Bankr. S.D.N.Y. Case No. 05-14945 through 05-14951).  Gary
Ravert, Esq., and Stephen B. Selbst, Esq., at McDermott Will &
Emery, LLP, represent the Debtors in their restructuring efforts.
As of Apr. 30, 2005, the Debtors listed $972 million in total
assets and $1 billion in total debts.  (Saint Vincent Bankruptcy
News, Issue No. 04; Bankruptcy Creditors' Service, Inc., 215/945-
7000)


SAINT VINCENTS: US Trustee Appoints 7-Member Creditor's Committee
-----------------------------------------------------------------
Pursuant to Section 1102 of the Bankruptcy Code, Deirdre A.
Martini, the United States Trustee for Region 2, appointed seven
members to the Official Committee of Unsecured Creditors in Saint
Vincents Catholic Medical Centers of New York and its debtor-
affiliates' Chapter 11 cases.

The Creditors Committee consists of:

    (1) American Express Travel Related Services Company, Inc.
        c/o Jason Halpern, Esq.
        200 Vesey Street
        New York, New York 10285
        Tel. No. (212) 640-5805

    (2) Computer Sciences Corporation
        3170 Fairview Park Drive MC 244
        Church Falls, Virginia 22042
        Attn.: Kathleen Ramey
        Tel. No.: (703) 641-3565

    (3) Special Touch Home Care Services, Inc.
        2091 Coney Island Avenue
        Brooklyn, New York 11223
        Attn.: Steven N. Ostrovsky
        Tel. No.: (718) 627-1122

    (4) Siemens Medical Solutions USA, Inc.
        51 Valley Stream Parkway
        Malvern, Pennsylvania 19355
        Attn.: Joe McCullion, Director Credit & Collection
        Tel. No.: (610) 219-4251

    (5) Aramark Corp., et al.
        1101 Market Street
        Philadelphia, Pennsylvania 19107
        Attn.: Mark Piccirillo, V.P. Finance
        Tel. No.: (215) 238-3345

    (6) Pension Benefit Guaranty Corporation
        1200 K Street, NW
        Washington, D.C. 202326-4000
        Attn.: Joel W. Ruderman, Esq.
        Tel. No.: (202) 326-4112

    (7) 1199SEIU National Benefit Fund for Health
           and Human Service Employees
        310 West 43rd Street
        New York, New York 10036-6407
        Attn.: Suzanne Hepner, Esq.
               Levy & Ratner
               80 Eighth Avenue
               New York, New York 10011-5126
               Tel. No. (212) 627-8100

Headquartered in New York, New York, Saint Vincents Catholic
Medical Centers of New York -- http://www.svcmc.org/-- the
largest Catholic healthcare providers in New York State, operate
hospitals, health centers, nursing homes and a home health agency.
The hospital group consists of seven hospitals located throughout
Brooklyn, Queens, Manhattan, and Staten Island, along with four
nursing homes and a home health care agency.  The Company and six
of its affiliates filed for chapter 11 protection on July 5, 2005
(Bankr. S.D.N.Y. Case No. 05-14945 through 05-14951).  Gary
Ravert, Esq., and Stephen B. Selbst, Esq., at McDermott Will &
Emery, LLP, represent the Debtors in their restructuring efforts.
As of Apr. 30, 2005, the Debtors listed $972 million in total
assets and $1 billion in total debts.  (Saint Vincent Bankruptcy
News, Issue No. 05; Bankruptcy Creditors' Service, Inc., 215/945-
7000)


SAKS INC: Tender Offer Completion Cues S&P to Lift Ratings to B+
----------------------------------------------------------------
Standard & Poor's Ratings Services raised its corporate credit and
senior unsecured debt ratings on Saks Inc. to 'B+' from 'CCC+' to
reflect the successful completion of a tender offer that reduced
debt by $585 million.  The ratings remain on CreditWatch with
developing implications.

"This action is a reflection of Saks taking a more proactive
approach to alleviate a potential acceleration of its debt," said
Standard & Poor's credit analyst Gerald Hirschberg.  Saks had
received a notice of a filing requirement default on June 15,
2005, by a hedge fund that owned more than 25% of the 2%
convertible senior notes.

Subsequently, Saks announced a comprehensive plan that would
greatly reduce its funded debt and that would extend the date for
filing its 10-K to Oct. 31, 2005. (Saks continues to state that it
expects to file its 10-K by Sept. 1, 2005).  On July 19, Saks said
that it had accepted for payment all of the approximately $585.7
million principal amount of senior notes that were tendered.

To pay for the tendered debt, Saks supplemented its previous cash
on hand of $320 million with $622 million in proceeds from the
sale of certain department store assets to Belk Inc.

The ratings remain on CreditWatch with developing implications.
This relates to continued uncertainty regarding the company's
ability to sell its Northern Department Store Group, the amount of
potential proceeds, and future capital structure.  While proceeds
may be used for further debt reduction, a more likely scenario
would include stock repurchases.  In addition to these financial
concerns, Standard & Poor's will reassess Saks' business risk
after the divestitures.


SALEM COMMS: Amended Credit Facility Increases Loan to $300 Mil.
----------------------------------------------------------------
Salem Communications Holding Corporation, a wholly owned
subsidiary of Salem Communications Corporation (NASDAQ:SALM),
amended its senior credit facility with a consortium of lenders
led by BNY Capital Markets, as Administrative Agent, effective
July 7, 2005.

The amended credit facility increased the Company's loan
commitments to $300 million, including the existing $75 million
term loan B commitment and $75 million revolving loan commitment,
by adding a new $150 million term loan C commitment ($50 million
of which was funded at closing and $100 million of which is
available for future funding).

The lenders under the facility and their commitments under the
Revolver and Term Loan C are:

                                           Revolving  Term Loan C
   Name of Lender                         Commitment   Commitment
   --------------                         ----------  -----------
   The Bank of New York                  $11,500,000
   Wells Fargo Foothill, LLC              $8,500,000  $12,000,000
   Bank of America, N.A.                  $8,750,000   $8,000,000
   SunTrust Bank                          $8,750,000   $8,000,000
   General Electric Capital Corporation   $8,750,000  $12,000,000
   Harris Nesbitt Financing, Inc.                     $17,500,000
   National City Bank                                 $17,500,000
   ING (U.S.) Capital, LLC                $8,750,000
   Bank of Scotland                                   $15,000,000
   Cooperatieve Centrale Raiffeisen-
      Boerenleen Bank B.A., "Rabobank
      International", N.Y. Branch                     $15,000,000
   U.S. Bank National Association                     $15,000,000
   Calyon New York Branch                 $7,500,000
   Credit Suisse, Cayman Islands Branch
      (formerly known as Credit Suisse
      First Boston, acting through
      its Cayman Islands Branch)          $7,500,000
   Deutsche Bank Trust Company Americas               $10,000,000
   The Prudential Insurance Company
      of America                                       $7,200,000
   Pruco Life Insurance Company                        $1,800,000
   American Skandia Life Assurance
      Company of America                               $1,000,000
   Wachovia Bank, National Association                $10,000,000
   UBS AG, Cayman Islands Branch          $5,000,000
                                         ----------- ------------
        TOTALS                           $75,000,000 $150,000,000
                                         =========== ============

In addition to increasing the Company's borrowing capacity and
reducing the margin used in determining interest rates, the
amendment reduced the effect of a limitation on the Company's
ability to repurchase Salem's stock by effectively increasing an
applicable basket from $5 million to $50 million.

"This bank amendment accomplishes three key goals for Salem,"
David A.R. Evans, executive vice president and chief financial
officer of Salem Communications, said.  "Financially, it reduces
the interest rate on our bank debt by between 25 and 50 basis
points and reduces our revolver commitment fees by 15 basis
points, which we expect to save us approximately $0.4 million per
year in interest expense.  Strategically, it provides additional
capacity to make acquisitions as well as to opportunistically
repurchase company stock.  We appreciate the strong level of
support that we received in this transaction from our banking
partners."

A full-text copy of the Second Amendment to the Company's Fifth
Amended and Restated Credit Agreement, as of July 7, 2005, is
available at no charge at http://ResearchArchives.com/t/s?7f

Salem Communications Corporation (NASDAQ:SALM) --
http://www.salem.cc/-- headquartered in Camarillo, CA, 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 Network(R), 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.

                         *     *     *

Salem Communications' 7-3/4% senior subordinated notes due 2010
carry Moody's Investors Service's and Standard & Poor's single-B
ratings.


SENSIENT TECH: Poor Credit Measures Cue S&P to Cut Ratings to BB+
-----------------------------------------------------------------
Standard & Poor's Ratings Services lowered its corporate credit
and senior unsecured ratings on Sensient Technologies Corp. to
'BB+' from 'BBB-'.

The outlook is stable.  The company had about $557 million of debt
as of June 30, 2005.

"The downgrade is based on Sensient's challenging operating
conditions, increasing raw material prices, and limited pricing
flexibility, which has resulted in credit measures below our
expectation for the maintenance of an investment-grade rating,"
said Standard & Poor's credit analyst Patrick Jeffrey.

The ratings on Sensient reflect the company's inconsistent
operating performance and moderately high debt leverage after a
large number of debt-financed acquisitions.  These factors are
offset somewhat by its position as a leading industrial marketer
of value-added flavors, fragrances, and colors, as well as
Standard & Poor's expectation that management will continue to
focus more on debt reduction in the future and less on external
investments.

A very challenging competitive environment has affected Sensient's
operating performance.  Operating margin have declined to about
17% for the 12 months ended June 30, 2005, from 20.1% in fiscal
2002 and 22% in fiscal 2000.  However, initiatives implemented in
2003 to reduce costs and improve operating efficiencies have
helped stabilize the company's margins in recent quarters.
These initiatives included headcount reductions, plant upgrades
and expansions, and asset consolidations.   While the company has
shown operating improvement in its Flavors & Fragrances Group, the
Color Group continues to face challenges.  Sensient's total sales,
which increased 6% in fiscal 2004, are down slightly through the
first half of fiscal 2005.


SHAW COMMUNICATIONS: Earns $43.3 Mil. of Net Income in 3rd Quarter
------------------------------------------------------------------
Shaw Communications Inc. (TSX:SJR.NV.B) (NYSE:SJR) reported $43.3
million of net income for the quarter ended May 31, 2005, compared
to $24.8 million of net income for the comparable period in 2004.
Net income for the nine months of the year was $94.2 million, up
from $62.0 million last year.

Jim Shaw, Chief Executive Officer of Shaw, commented: "Shaw's
entry into the telephone business is a defining moment in our
history.  On February 14, 2005, we launched Shaw Digital Phone in
Calgary and followed up approximately two months later with a
launch in Edmonton.  With these two markets launched we are able
to offer telephone service to over 25% of our customers.  Digital
Phone gives us the capability to tap into a new revenue stream
leveraging off our existing infrastructure and we are pleased by
the success in our first full quarter of Digital Phone operations.
At May 31, 2005, we reported installed and pending Digital Phone
lines of 22,450."

Total service revenue of $559.9 million and $1.6 billion for the
three and nine month periods, respectively, grew 5.2% and 6.4%
over the same periods last year.  Consolidated service operating
income before amortization of $252.9 million and $731.2 million
improved 6.4% and 6.5%, respectively.  Funds flow from operations
increased to $197.7 million and $564.4 million for the quarter and
year-to-date compared to $179.3 million and $508.5 million in the
same periods last year.

Jim Shaw, continued: "We are pleased that, even with our
management focus on launching Digital Phone in two major markets,
we were able to report improved service revenue, service operating
income before amortization and earnings over the same periods last
year.  We also improved all three of these financial metrics on a
consecutive basis.  In addition, customer growth was positive
which reflects the strengthening of our bundled products,
particularly with Shaw's entry into the triple play market of
video, data and voice and the continued roll out of service
enhancements across all product lines and services."

On the traditional lines of business, the Company reported
quarterly customer growth in basic cable of 1,338 or 0.1%, digital
television of 9,764 or 1.7%, Internet of 27,034 or 2.5% and DTH of
6,252 or 0.8%.

Free cash flow for the quarter was $89.3 million bringing the
year-to-date amount to $195.6 million.  This compares to
$73.7 million and $222.8 million in the same periods last year.
The decrease on a year-to-date basis was primarily due to higher
capital expenditures in cable associated with investments to
support customer growth and the rollout of Digital Phone.
Satellite achieved record free cash flow of $20.9 million for the
quarter.

Jim Shaw commented: "The performance to date provides us with
confidence that Shaw is on track to meet its free cash flow
guidance of $270 - $285 million for 2005.  We are excited about
our product success and need to continue to rollout new products
and services rapidly.  Accordingly, our preliminary view for
fiscal 2006 calls for capital and net equipment spending to range
from $535 - $545 million.  We are planning to increase capital
spending in fiscal 2006 in order to accelerate digital phone
growth and to support ongoing network upgrades and service
enhancements in Internet, digital video, HDTV and VOD.  In
addition, the Company plans to start a multi-year project to
upgrade and modernize its customer management and billing systems
in order to facilitate the increasing complexity of offering
greater customer choices, bundled offerings and transaction-based
services.  These improvements will also enable the Company to
address the future integration of service offerings, offer new
services rapidly and respond to competitive dynamics.  We expect
that growth of service operating income before amortization in
fiscal 2006 will be moderated by the ongoing upfront investments
required for Digital Phone deployment.  We plan to provide
specific guidance on service operating income before amortization
and free cash flow when we release our 2005 year-end results."

Cable service revenue increased 6.9% for the quarter to
$405.6 million (2004 - $379.3 million) and 6.9% for the nine
months of the year to $1.2 billion (2004 - $1.1 billion).  This
growth resulted from rate increases, customer growth and the
impact of the Monarch cable systems acquisition, which took place
in the third quarter of fiscal 2004.  Service operating income
before amortization increased 4.4% to $203.9 million (2004 -
$195.2 million) for the quarter and 2.2% to $596.9 million (2004 -
$583.8 million) for the nine months.

On a year-over-year basis, the Satellite division's service
revenue increased by 1.0% to $154.3 million and by 5.0% to
$457.6 million for the three and nine months, respectively, due to
rate increases, change in mix of promotional activities and
customer growth in DTH.  Over the same respective periods, service
operating income before amortization increased by 15.5% to
$49 million and 22.8% to $134.4 million.  The improvement was
largely due to the growth in DTH revenue and reduced costs.

Jim Shaw remarked, "Both divisions are meeting expectations.  The
satellite business is maturing and the team is now able to focus
on operating efficiencies which is reflected in the double digit
growth in service operating income before amortization over the
same periods last year.  On a consecutive basis, satellite's
quarterly service operating income before amortization increased
8.9%, while cable's increased 2.3%.  With the launch of Digital
Phone, Cable has incurred upfront investments to enhance customer
care and build our telephone operations.  While this has exerted
pressure on cable margins, we strongly believe these investments
position the Company for significant growth in the future."

During the quarter, Shaw repurchased 5,454,900 of its Class B Non-
Voting Shares for cancellation pursuant to the normal course
issuer bid for $135.5 million ($24.83 per share) bringing the
year-to-date total to $159.4 million ($24.19 per share) on the
repurchase of 6,589,500 shares, representing approximately 3.0% of
the Class B Non-Voting Shares outstanding at August 31, 2004.  In
the near term, Shaw expects to continue to use free cash flow to
pay dividends and repurchase shares.

Shaw Communications Inc. is a diversified Canadian communications
company whose core business is providing broadband cable
television, Internet, Digital Phone, telecommunications services
(through Big Pipe Inc.) and satellite direct-to-home services
(through Star Choice Communications Inc.) to approximately 3.0
million customers. Shaw is traded on the Toronto and New York
stock exchanges and is a member of the S&P/TSX 60 index (Symbol:
TSX - SJR.NV.B, NYSE - SJR).

                         *     *     *

As reported in the Troubled Company Reporter on March 7, 2005,
Standard & Poor's Ratings Services revised its outlook to positive
from stable on Calgary, Alberta-based Shaw Communications Inc.,
Western Canada's largest cable operator.

At the same time, Standard & Poor's affirmed its 'BB+' long-term
corporate credit and senior unsecured debt ratings, and its 'B+'
preferred stock rating.

"The revised outlook reflects expectations for continued
improvement in Shaw's financial risk profile.  Shaw has reduced
debt by almost C$600 million in the past two years, and has
demonstrated modest EBITDA growth," said Standard & Poor's credit
analyst Joe Morin.  The company's operating performance should
continue to show modest improvements for the foreseeable future,
which will support further debt reduction from free operating cash
flow.


SHURGARD STORAGE: S&P Lowers Preferred Stock Rating to BB+
----------------------------------------------------------
Standard & Poor's Ratings Services lowered its corporate credit
and senior unsecured credit ratings on Shurgard Storage Centers
Inc. to 'BBB-' from 'BBB', impacting $450 million in senior notes.
In addition, the company's preferred stock rating was lowered to
'BB+' from 'BBB-'.  The outlook is revised to stable from
negative.

"The downgrades reflect concerns regarding the company's
constrained financial flexibility and a financial profile that is
unlikely to return to historical levels in the near term,
particularly in view of plans for new store growth and reduced
current public market access as the company continues to work
through ongoing financial reporting and compliance issues," said
Standard & Poor's credit analyst Linda Phelps.  "The company is
also undergoing some meaningful transitions within its senior
ranks, while it operates within an arguably more competitive self-
storage market characterized by the recent entry of new, well-
capitalized players."

With the slower pace of new European store development and
potential operating efficiencies from full consolidation of
European operations to offset the continuing drag from development
of new European stores, the likelihood of further operating margin
erosion is reduced.  Although the company's plans call for
significant ongoing development in Europe, its exposure and
capital needs are somewhat reduced through its development joint
ventures.  While the company's financial and Sarbanes-Oxley
compliance issues have not yet been fully resolved, Standard &
Poor's believes the company has made significant progress toward a
resolution.


SKIN NUVO: Wants Exclusive Plan Filing Period Stretched to Aug. 19
------------------------------------------------------------------
Skin Nuvo International, LLC, and its debtor-affiliates ask the
U.S. Bankruptcy Court for the District of Nevada to extend,
until Aug. 19, 2005, 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, until
Oct. 18, 2005.

The Debtors give the Court four reasons why the exclusive periods
should be extended:

   1) the vast amount of time they and their advisors spent in
      various pre-petition acts, including rebuilding and
      recreating records, have significantly decreased the time
      available for them to negotiate a chapter 11 plan and
      prepare a disclosure statement;

   2) the complexities arising from the administration of 44
      debtor-affiliates under chapter 11;

   3) they have made significant, good-faith progress towards
      reorganization, including liquidating substantially all of
      their assets and cooperating with the Official Committee of
      Unsecured Creditors regarding the contents of a consensual
      plan; and

   4) they have remained substantially current on all their post-
      petition obligations, except when those obligations are
      disputed.

Headquartered in Henderson, Nevada, Skin Nuvo International, LLC,
dba Nuvo International, LLC, and dba A&E Aesthetics, LLC --
http://www.nuvointernational.com/-- specializes in offering
progressive anti-aging treatments and top quality products and the
first medical cosmetic company to launch a chain of retail skin
care clinics in shopping malls throughout the United States.
Keith M. Aurzada, Esq., and Sarah Link Schultz, Esq., at Akin Gump
Strauss Hauer & Fled LLP represent the Debtors in their
restructuring efforts.  The Company and its debtor-affiliates
filed for chapter 11 protection on March 7, 2005 (Bankr. D. Nev.
Case No. 05-50463).  When the Debtors filed for protection from
their creditors, they estimated assets and debts of $10 million to
$50 million.


SOUTHWEST RECREATIONAL: Panel Wants to Conduct Rule 2004 Probe
--------------------------------------------------------------
The Official Committees of Unsecured Creditors for Southwest
Recreational Industries, Inc., and its debtor-affiliates ask the
U.S. Bankruptcy Court for the Northern District of Georgia in Rome
for authority to conduct an examination under Rule 2004 of the
Federal Rules of Bankruptcy Procedure.

The Committee tells the Court that the examination will aid the
estate in the discovery and realization of the Debtors' assets and
the maximization of the return to the Debtors' creditors.

The Committee will investigate:

    a) pre-petition contracts and the relationship between the
       Debtors and Zurich American Insurance Company;

    b) claims Zurich may hold against the Debtors and other
       matters relevant to the administration of the Debtors'
       bankruptcy estates.

Zurich American allegedly provided workers' compensation,
automobile liability and general liability insurance to the
Debtors prior to their chapter 11 filings.  The Committee claims
that the insurance company holds certain property of the Debtors'
estate as security for the payment of these insurance premiums.

On May 18, 2005, Zurich requested payment of its administrative
expense claim and asked the Court for priority treatment of a
portion its claims.

The Committee tells the Court that the examination will aid the
estate in the discovery and realization of the Debtors' assets and
the maximization of the return to the Debtors' creditors.

As part of its investigation, the Committee asks the Court to
compel Zurich American to produce several documents related to its
transactions with the Debtors.  A list of these documents is
available for free at http://bankrupt.com/misc/SouthwestDocs.pdf

Headquartered in Leander, Texas, Southwest Recreational
Industries, Inc. -- http://www.srisports.com/-- designs,
manufactures, builds and installs stadium and arena running tracks
for schools, colleges, universities, and sport centers.  The
company filed for chapter 11 protection on February 13, 2004
(Bankr. N.D. Ga. Case No. 04-40656).  Jennifer Meir Meyerowitz,
Esq., Mark I. Duedall, Esq., and Matthew W. Levin, Esq., at Alston
& Bird, LLP, represent the Debtors in their restructuring efforts.
When the Company filed for protection from its creditors, they
listed $101,919,000 in total assets and $88,052,000 in total
debts.  On Aug. 11, 2004, Ronald L. Glass was appointed as Chapter
11 Trustee for the Debtors.  Henry F. Sewell, Jr., Esq., Gary W.
Marsh, Esq., at McKenna Long & Aldridge LLP represent the Chapter
11 Trustee.


SOVEREIGN BANCORP: Directors Authorize 20 Million Share Buy-Back
----------------------------------------------------------------
Sovereign Bancorp, Inc. (NYSE: SOV), parent company of Sovereign
Bank, said that its Board of Directors has authorized a stock
repurchase program of up to 20 million shares, approximately 5% of
shares outstanding, to commence at the conclusion of a previously
authorized repurchase program.  This buyback program is in
addition to existing authorizations to repurchase up to
approximately 20 million shares, under which the Company has
previously repurchased 16 million shares.  These programs have no
prescribed time period in which to fill the authorized repurchase
amount.

"The action taken by our Board is reflective of Sovereign's
financial strength," Jay S. Sidhu, Sovereign's Chairman and Chief
Executive Officer, said.  "We are currently generating
approximately $200 million of average tangible common equity per
quarter and our capital ratios are near management's goal of
approximately 7% Tier 1 Leverage and 4.75% to 5.00% tangible
common equity to tangible assets.  At the current time, we feel
share repurchases are the best use of our excess capital relative
to other alternatives.  While continuing to manage to our capital
targets via stringent balance sheet management, we have returned
86% of our net income to shareholders year-to-date through
dividends and share repurchases," Mr. Sidhu continued.

Share repurchases will be made from time to time and will be
effected on the open market, in block trades, or in privately
negotiated transactions, and in compliance with applicable laws,
including Securities and Exchange Commission Rule 10b-18 and
Regulation M.

Sovereign Bancorp, Inc., (NYSE: SOV), is the parent company of
Sovereign Bank -- http://www.sovereignbank.com/-- a $60 billion
financial institution with more than 650 community banking
offices, over 1,000 ATMs and approximately 10,000 team members
with principal markets in the Northeast United States.  Sovereign
offers a broad array of financial services and products including
retail banking, business and corporate banking, cash management,
capital markets, trust and wealth management and insurance.
Sovereign is the 19th largest banking institution in the United
States.

                        *     *     *

As reported in the Troubled Company Reporter on April 21, 2005,
Fitch Ratings has affirmed the ratings of Sovereign Bancorp (SOV;
long-term/short-term 'BBB-/F3') and its bank subsidiary, Sovereign
Bank (long-term/short-term 'BBB/F2').  At the same time, Fitch has
revised both SOV and Sovereign Bank's Rating Outlook to Positive
from Stable.

The revision in the Rating Outlook is supported by SOV's
consistent earnings performance, sound and improved asset quality,
and the company's profitable franchise expansion.  The revision
also reflects SOV's improved financial flexibility associated with
a decline in the parent company's borrowing cost and a reduction
in double leverage.  That said, while improved, the company's
profile still exhibits a significant level of parent company debt
and a relatively modest level of tangible equity.

Ratings affirmed by Fitch and Rating Outlook revised to Positive
from Stable:

   Sovereign Bancorp, Inc.

      -- Short-term 'F3';
      -- Long-term senior 'BBB-';
      -- Subordinated debt 'BB+'
      -- Individual 'C';
      -- Support '5'.

   Sovereign Bank

      -- Short-term 'F2'.
      -- Long-term Senior 'BBB';
      -- Subordinated Debt 'BBB-'
      -- Long-term Deposits 'BBB+';
      -- Short-term deposit 'F2';
      -- Individual 'B/C';
      -- Support '4'.

Ratings Affirmed:

   Sovereign Capital Trust I

      -- Preferred Stock 'BB'.

   Sovereign Capital Trust IV

      -- Preferred Stock 'BB'.

   ML Capital Trust I

      -- Preferred Stock 'BB'.

   Sovereign Real Estate Investment Trust

      -- Preferred Stock 'BB+'


STRUCTURED ASSET: Fitch Affirms Low-B Ratings on 12 Cert. Classes
-----------------------------------------------------------------
Fitch Ratings has affirmed 40 classes of Structured Asset
Securities Corp. residential mortgage-backed certificates:

   Series 2001-16H

     -- Class A affirmed at 'AAA';
     -- Classes B1, BX-1 affirmed at 'AAA';
     -- Classes B2, BX-2 affirmed at 'AA';
     -- Class B3 affirmed at 'BBB';
     -- Class B4 affirmed at 'BB';
     -- Class B5 affirmed at 'B'.

   Series 2002-4H

     -- Class A affirmed at 'AAA';
     -- Class B1 affirmed at 'AAA';
     -- Class B2 affirmed at 'AA';
     -- Class B3 affirmed at 'BBB+';
     -- Class B4 affirmed at 'BB';
     -- Class B5 affirmed at 'B'.

   Series 2002-10H

     -- Class A affirmed at 'AAA'
     -- Class B1 affirmed at 'AA'
     -- Class B2 affirmed at 'A'
     -- Class B3 affirmed at 'BBB'
     -- Class B4 affirmed at 'BB'
     -- Class B5 affirmed at 'B'

   Series 2002-22H group 1

     -- Class 1A affirmed at 'AAA';
     -- Class B1-I affirmed at 'AA';
     -- Class B2-I affirmed at 'A';
     -- Class B3-I affirmed at 'BBB';
     -- Class B4-I affirmed at 'BB';
     -- Class B5-I affirmed at 'B'.

   Series 2002-22H group 2

     -- Class 2A affirmed at 'AAA';
     -- Class B1-II affirmed at 'AA';
     -- Class B2-II affirmed at 'A';
     -- Class B3-II affirmed at 'BBB';
     -- Class B4-II affirmed at 'BB';
     -- Class B5-II affirmed at 'B'.

   Series 2003-7H

     -- Class A affirmed at 'AAA';
     -- Classes B1-F, B1-III affirmed at 'AA';
     -- Classes B2-F, B2-III affirmed at 'A';
     -- Class B3 affirmed at 'BBB';
     -- Class B4 affirmed at 'BB';
     -- Class B5 affirmed at 'B'.

These affirmations reflect credit enhancement consistent with
future loss expectations and affect $289,878,957 of outstanding
certificates.  The pools are seasoned from a range of 27 to 43
months.  The pool factors (current principal balance as a
percentage of original) range from approximately 10% to 36%
outstanding.

The collateral consists of adjustable or fixed rate, conventional,
fully amortizing first lien residential mortgage loans.
Additionally, all of the mortgage loans have loan to value ratios
in excess of 80%.  The mortgage loans generally are covered by
primary mortgage insurance polices issued by either United
Guaranty Corporation in connection with the Borrower Advantage
Program, or Mortgage Guaranty Insurance Corporation in connection
with the Pro Mortgage Program.

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


SUNRISE CDO: Fitch Junks $15 Million Class C Notes
--------------------------------------------------
Fitch Ratings places three tranches of Sunrise CDO I on Ratings
Watch Negative:

     -- $175,054,091 class A notes rated 'AAA';
     -- $ 45,100,000 class B notes rated 'BBB-';
     -- $ 15,241,101 class C notes rated 'CCC+'.

Sunrise CDO I is a static-pool, collateralized debt obligation
structured by Credit Suisse First Boston.  The CDO was established
in December 2001 to issue approximately $300 million in notes and
preference shares.  The proceeds were utilized to purchase an
investment portfolio consisting primarily of collateralized debt
obligations, residential mortgage-backed securities, commercial
mortgage-backed securities, asset-backed securities, and corporate
debt securities.

Since the last rating action in November 2004, the class A
overcollateralization ratio has decreased from 118.8% to 101.9%,
the class B OC ratio decreased from 94.5% to 79.4%, and the class
C OC ratio decreased from 88.5% to 73.9%, as reported on the June
30, 2005 trustee report.  Subsequently, all OC ratios are
currently failing their equivalent tests of 120%, 106.5%, and
101.8%, respectively.  Additionally, the overall portfolio
continues to experience negative performance through impaired and
defaulted assets, along with a negative change to the weighted
average rating factor.

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.  Additional deal information and historical data are
available on the Fitch Ratings web site at
http://www.fitchratings.com/


THOMAS BABB: Voluntary Chapter 11 Case Summary
----------------------------------------------
Debtor: Thomas Babb
        13 Hobbs Avenue
        Brookfield, Massachusetts 01506

Bankruptcy Case No.: 05-44838

Chapter 11 Petition Date: July 20, 2005

Court: District of Massachusetts (Worcester)

Debtor's Counsel: Francis Lafayette, Esq.
                  P.O. Box 1020
                  Palmer, Massachusetts 01069
                  Tel: (413) 283-7785

Estimated Assets: $1 Million to $10 Million

Estimated Debts:  $500,000 to $1 Million

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


UAL CORP: Machinists Ratify Six Amended Labor Contracts
-------------------------------------------------------
The International Association of Machinists and Aerospace Workers
disclosed the ratification of six amended collective bargaining
agreements with United Airlines.  The four and a half year
agreements are the result of negotiations under Section 1113(c) of
the U.S. bankruptcy code and preserve existing IAM contracts at
the carrier while providing a defined benefit pension plan to
replace the plans terminated by agreement between United and the
Pension Benefit Guaranty Corporation.

"Our negotiators were able to leverage the strength of a ninety
eight percent strike authorization to not only reject United's
harshest proposals, but to also establish a new defined benefit
pension plan for our members," said Robert Roach, Jr., IAM General
Vice President of Transportation.  "Our negotiators did a
remarkable job under the most difficult circumstances imaginable."

IAM members in the Ramp & Stores, Public Contact, Fleet Technical
Instructor, Maintenance Training Instructor, Security and Food
Service Worker classifications each ratified their respective
agreements.  The union disclosed that 67 percent of all voting IAM
members accepted the amended terms.  Ratification of the
agreements prevents bankruptcy court abrogation of the contracts
and a strike by the IAM's 20,000 members at United.

"Our members and retirees have repeatedly provided United Airlines
with the means to successfully restructure and exit bankruptcy,
only to see it squandered," said Randy Canale, President of IAM
District 141.  "We have reached the limit of our members'
sacrifice and patience.  If United management cannot utilize the
cost savings their employees provided to reverse course and become
competitive, they must be replaced with more capable individuals."

                     UAL Issues Statement

"As United continues to build momentum toward exit from
Chapter 11, [yester]day's ratification by the IAM is an important
step.  This agreement means that we now have ratified,
consensually negotiated collective bargaining agreements with all
our labor groups, bringing a difficult phase of our restructuring
to a close.  We commend the IAM for their hard work and creativity
in developing solutions to the pension issue while meeting
United's financial needs.

"Importantly, we now also have replacement retirement plans for
all of United's union and non-union groups, with the exception of
the Association of Flight Attendants who have yet to meet with us
to negotiate a plan."

The CBAs for each of United's unions will become amendable in
January 2010.

                IAM Collective Bargaining Agreements



The proposed changes to the IAM collective bargaining agreements
are:

    1) a reduction in pay of 11.5% in all pay factors for all
       longevity steps in all classifications; and

    2) an allotment of 70% of the pay normally received for sick
       days.

The agreement establishes participation in the multi-employer IAM
National Pension Plan.  The IAM National Pension Plan is a fully-
funded defined benefit plan covering 65,000 beneficiaries at 1,700
U.S. companies.

              IAM-UAL Tentative Agreement Term Sheet

The tentative agreement between United Air Lines, Inc., and
International Association of Machinists and Aerospace Workers
provide for modifications to the 2003-2009 IAM Agreements between
the parties, which includes:

   * the Ramp and Stores,
   * Public Contact Employees',
   * Food Services,
   * Security Officers',
   * Fleet Technical Instructors and Related and Maintenance
     Instructors Agreements.

No changes are proposed to the Mileage Plus, Inc. Public Contact
Employees' Agreement.

The IAM Agreements will become effective on July 1, 2005, and
continue to be in effect through December 31, 2009.

                            Wage Rates

Effective July 1, 2005, all base wage rates in effect as of
May 1, 2004, will be reduced by 5.5%.  The base wage rates will
be increased by 1.5% on May 1, 2007, and on May 1, 2008.  The
base wage rates will be increased by 2.5% on May 1, 2009.

In lieu of the premium increases set forth in the 2003-2009 IAM
Agreements, shift premiums, Service Director premium, and Hawaii
differential will be increased by 1.5% on May 1, 2007, and May 1,
2008, and will be increased by 2.5% on May 1, 2009.

                             Holidays

On the Effective Date of the 2005-2009 IAM Agreements, the number
of Company-paid holidays will be reduced from 10 to eight by the
elimination of:

   -- the Good Friday and the Day After Thanksgiving holidays for
      employees covered by the Ramp and Stores, Security
      Officers', Food Services, Maintenance Instructors and Fleet
      Technical and Related Agreements; and

   -- the Fourth of July and the Day After Thanksgiving holidays
      for employees covered by the Public Contact Employees'
      Agreement.

For 2005, however, the Ramp et al. will eliminate the Labor Day
holiday and in the event PCE ratification occurs after July 4,
2005, employees covered by the PCE Agreement will eliminate the
Labor Day holiday for 2005.

                         Vacation Accrual

On the Effective Date, the vacation accrual rates will be:

     Length of Company Service           Weeks of Vacation
     -------------------------           -----------------
            0 to 1 year                     1 (40 hours)
                                              (accrued at 3-1/3
                                              hours per month)

            1 year                          2 (80 hours)

            9 years                         3 (120 hours)

           16 years                         4 (160 hours)

           24 years                         5 (200 hours)

           29 years                         6 (240 hours)

To achieve the full savings associated with the modification in
2005, the parties agree that the accrual rates from July 1, 2005,
through December 31, 2005, will be adjusted so that the accrued
vacation available in 2006 is the annual rate.

                            Sick Leave

Effective July 1, 2005, each hour of occupational or non-
occupational sick leave charged to the employee's bank will be
paid at 80% of the employee's hourly rate for the first 56
consecutive hours of sick leave usage for each absence and 100%
for consecutive hours thereafter.

               Special Terms for FTI & MI Employees

The changes applicable to Fleet Technical Instructors and Related
and Maintenance Instructors Agreements with respect to wages,
vacation and health insurance, are:

   1.  Base wage rates for Fleet Technical Instructors and
       Related will be reduced by 3%;

   2.  The base, license and skill components of the lead
       Maintenance Instructor and Maintenance Instructor pay
       rates will be reduced by 3%;

   3.  On January 1, 2006, May 1, 2007, and May 1, 2008, the
       base wage rates will be increased by 1.5%;

   4.  On May 1, 2009, the base wage rates will be increased by
       2.5%.

As soon as practicable after the Effective Date, the Fleet
Technical Instructors and Related Employees and Maintenance
Instructor Employees will participate in an open enrolment in the
Employee Welfare Benefit Plan for Management Employees at the
rates applicable to Management Employees.

Current vacation accrual schedule will not change for Fleet
Technical Instructors and Related Employees and Maintenance
Instructor Employees.

All holiday pay will be paid at 2 times the employee's applicable
hourly rate.

                Employer Contribution to LTD Plan

On the Effective Date of the 2005-2009 IAM Agreements, the Public
Contact Employees Agreement will be revised to provide that the
employee will pay 100% of the cost of long-term disability
benefits.

                            Part Time

The work rule provisions of the 2003-2009 Ramp and Stores
agreement will be modified to increase the percentage caps on use
of part-time employees for Class A stations from 25% to 30% and
for Class B stations from 35% to 40%.

                        Scope/Outsourcing

The scope/outsourcing provisions of the 2003-2009 IAM Agreements
are modified:

   1.  United will have the unrestricted right to close the Miami
       Kitchen and outsource that work;

   2.  United will continue to maintain the existing cafeterias.

   3.  United will have the unrestricted right to outsource
       fueling work.

   4.  United will have the unrestricted right to outsource cabin
       service work performed by Ramp Servicemen at BUF, ATL,
       FLL, MCO, MSP, SAN, SMF, TPA.

            Participation in IAM National Pension Plan

United will participate in the IAM National Pension Plan.  The
parties agree that all full-time and part-time active employees
who are represented by the IAM will be eligible to participate in
the Plan effective March 1, 2006, or beginning on the first day
of employment, if later.  Notwithstanding, United's contributions
on behalf of new-hire employees will be made retroactively after
the first 60 calendar days of service have been completed.

There will be no contribution prior to March 1, 2006.  United's
contribution rate will be equivalent to:

     4.0% of "Considered Earnings" and Success Sharing Payments
          effective March 1, 2006;

     5.0% effective March 1, 2007;

     6.0% effective March 1, 2008; and

     6.5% effective March 1, 2009.

                     Profit & Success Sharing

The profit sharing provisions of the defined contribution plan
will replace the Profit Sharing Program of United's existing
Success Sharing Plan.

In the event that United has more than $10 million in Pre-Tax
Earnings in the relevant calendar year, then the Profit Sharing
Pool will be 7.5% of Pre-Tax Earnings in 2005 and 2006, and 15%
of Pre-Tax Earnings in each calendar year thereafter.

The Success Sharing formula will be amended to pay out:

      0.5% at the Threshold level;
      1.0% at the Target level; and
      2.0% at the Maximum level.

               IAM Gets Stake in Reorganized United

The IAM will receive $60,000,000 in [___]% Senior Subordinated
Convertible Notes Due 2021 from Reorganized UAL Corp. through a
trust or similar non-permanent vehicle for the benefit of
eligible United employees represented by the IAM.

The Notes will have a 15-year term from the Issuance Date.  The
Notes will be junior to the Reorganized UAL exit facility,
customary secured indebtedness, indebtedness contemplated under a
plan of reorganization, and other mutually agreed-upon
indebtedness.  The Notes will be pari passu to all current and
future UAL or United Airlines senior unsecured debt, and senior
to all current and future subordinated debt.

Distribution mechanics, eligibility and allocation among the
employees will be determined by the IAM.

                  United Will Pay for IAM's Fees

United will reimburse up to $2.5 million of the reasonable,
actual fees and out-of-pocket expenses incurred by the IAM in
connection with the review, design, negotiation, approval,
ratification, and execution of the Letter of Agreement,
including:

   a.  reasonable base wages lost by the IAM Negotiating
       Committee members in connection with meetings called for
       the purpose of negotiating, reviewing, approving or
       ratifying the agreed Term Sheet and the Letter of
       Agreement; and

   b.  the reasonable, actual fees and expenses of the IAM's
       outside legal, pension, and other professional advisors.

United will pay $1.25 million on the Effective Date, and the
remaining $1.25 million will be paid on the Exit Date.

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: KfW Transfers 5 Claims for $168.7MM to R2 Investments
-----------------------------------------------------------------
Pursuant to Rule 3001(e)(2) of the Federal Rules of Bankruptcy
Procedure, Kreditanstalt fur Wiederaufbau of Frankfurt, Germany,
transferred five claims aggregating $168,678,472 to R2
Investments, LDC, of Fort Worth, Texas in US Airways, Inc., and
its debtor-affiliates' chapter 11 cases:

Claim No.   Claim Amount      Aircraft/Engine        Tail No.
---------   ------------      ---------------        --------
   2758      $36,944,060   Airbus A320/CFM 56-5B-4/P   N112US
   2759       31,597,130   Airbus A319/CFM 56-5B-6/P   N733UW
   5164       36,944,060   Airbus A320/CFM 56-5B-4/P   N112UW
   5166       31,596,611   Airbus A319/CFM 56-5B-6/P   N732US
   5167       31,596,611   Airbus A319/CFM 56-5B-6/P   N730US

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


USG CORP: Opposes Discovery as Parties Present Witness List
-----------------------------------------------------------
USG Corporation and its debtor-affiliates wants the U.S.
Bankruptcy Court for the District of Delaware to deny the
discovery requests of:

   * the Official Committee of Asbestos Personal Injury Claimants;

   * the Official Representative for Future Asbestos Personal
     Injury Claimants;

   * the Statutory Committee of Equity Security Holders

The PI Committee and the Futures Representative requested
discovery in three general areas:

   (i) the scientific evidence regarding the merits of
       the personal injury claims;

  (ii) the Debtors' tort system experience; and

(iii) the Debtors' proposed sampling of personal injury
       claims for estimation purposes.

The Equity Committee wants discovery by all parties.

"The question of whether the Court should consider the merits of
claims in estimation is a legal question, and advance factual
discovery is not needed to answer it," Karen M. McKinley, Esq.,
at Richards, Layton, & Finger, P.A., in Wilmington, Delaware,
tells the U.S. District Court for the District of Delaware.

Ms. McKinley notes that no discovery was requested or ordered
before Judge Wolin concluded that the merits of claims must be
considered in estimation, and none of the discovery the Official
Committee of Asbestos Personal Injury Claimants asserts to need
now can possibly justify the result it seeks -- namely, the
exclusion of all evidence on the merits of claims from the
Debtors' proceedings.

However, Ms. McKinley states, if any discovery is permitted at
the present time, it is more efficient and certainly fairer to
allow all estimation discoveries to go forward.  In that way, the
District Court will have the advantage of a complete record to
decide, during the estimation proceedings, what evidence is
relevant to determining U.S. Gypsum's liabilities.

Although the only issue present before the District Court is
whether the requested discovery is warranted, Ms. McKinley says
that the PI Committee's discovery brief focuses instead on the
issue that the PI Committees said it was not ready to discuss --
whether the merits of claims should be considered in estimating
U.S. Gypsum's asbestos personal injury liabilities.  Ms. McKinley
points out that by devoting its brief to arguing that merits
evidence should be excluded, the PI Committee confirmed that the
Court can resolve that issue without discovery.

Indeed, District Court does not need advance discovery to
conclude that merits evidence should be considered in estimation,
according to Ms. McKinley.

Ms. McKinley recounts that the PI Committee's argument that the
Debtors' merits-based proposal is extraordinary was rejected by
Judge Wolin, who held that it is the Court's duty to "reject
unsubstantiated claims, bogus medical evidence and fanciful
theories of causation [in estimation]."  Judge Wolin's view was
recently adopted by the Chief Judge of the Bankruptcy Court for
the District of New Jersey in another asbestos-related
bankruptcy.

"What is without precedent, however, is the [PI Committee's] plan
to impose an estimation based solely on claims settlement history
over the Debtors' objections," Ms. McKinley says.  "The [PI
Committee] provides no case support whatsoever for its proposal
to affirmatively preclude merits evidence."

Ms. McKinley further argues that discovery on the two topics
requested by the PI Committee will not provide any basis for the
exclusion of merits evidence from that estimation.  With respect
to the Committee's first request, even if it can show that U.S.
Gypsum's claims settlement history is relevant to estimation,
that will not justify excluding, without any consideration
whatsoever, other evidence relevant to estimation. Ms. McKinley
maintains that demonstrating that one source of potentially
relevant information exists, does not justify excluding all other
relevant information.

In fact, Ms. McKinley relates, the Debtors do not contend that
U.S. Gypsum's claims settlement history should be summarily
excluded from consideration in estimation, but the Debtors intend
that the actual merits of the claims be considered in estimation.

Discovery on the PI Committee's proposal on how merits evidence
will be considered in estimation also could not justify
estimation based solely on claims settlement history, Ms.
McKinley contends.

When the Debtors file their request for estimation before the
District Court, and if the PI Committee believes that the
estimation proposal is unclear, the Committee is free to argue
that the Debtors' request should be denied for lack of
completeness.

Therefore, instead of proceeding with the "one-sided, incomplete
discovery" sought by the PI Committee, the Debtors ask the
District Court to direct the parties to file motions for
estimation, in which the parties set forth their estimation
proposals -- as they already have begun to do in their
corresponding discovery briefs.  After briefing and argument, the
Court can decide how it will conduct the estimation, and all
parties can then pursue whatever discovery is appropriate to the
estimation ordered by the Court.

         PI Committee & Futures Rep Present Witness List

Pursuant to Rule 26(a)(1)(A) of the Federal Rules of Civil
Procedure and the Court's directives at the June 13, 2005,
hearing regarding the estimation of the number and amount of USG
Corp.'s liabilities for present and future personal injury
asbestos claims, the Official Committee of Asbestos Personal
Injury Claimants and Future Claimants Representative Dean M.
Trafelet delivered to the Court a proposed list of witnesses to
be called at the estimation hearing in their case-in-chief.
These disclosures are based on information reasonably available
to the PI Committee and the Futures Representative.

The parties reserve their rights to supplement and amend their
proposed list as soon as additional information becomes available
to them.  The parties further assert their rights to designate
the witnesses and those additional witnesses to rebut the
testimony of any witness offered by any of the other parties to
the estimation hearing.

The witnesses and their proposed testimonies are:

Witness                  Subject Matter of Proposed Testimony
-------                  ------------------------------------
Estimation experts       Estimation of the number and value
                         of pending and future asbestos personal
                         injury claims against USG

Financial experts        If the discount rate for future
                         asbestos liabilities is at issue,
                         testimony includes the discount rate
                         to be used to calculate the present
                         value of USG's personal injury
                         asbestos liability as of the Petition
                         Date.  For the Asbestos Committees,
                         the USG's public filing reserves for
                         its asbestos liability, if at issue,
                         should also be covered.

Medical expert           Standards for diagnosis of asbestos-
                         related diseases and their effects;
                         significant asbestos-related diseases
                         can be present in patients even where
                         standard lung function tests or x-rays
                         appear to be normal; that lung cancer
                         can be caused by asbestos exposure even
                         without a diagnosis of asbestosis and
                         it can cause other cancers.

Other medical experts    Propensity of exposure to pure
                         chrysotile to cause mesothelioma or
                         other asbestos-related diseases

Fiber composition        Issues relating to whether there are
expert                   any USG asbestos-containing products
                         Consisting of "pure" chrysotile

Presently unknown        Manufacture, sales and distribution of
former or current USG    asbestos-containing products by USG
employees

Outside counsel to USG   Supervision and conduct of USG's
                         asbestos litigation defense, litigation
                         and settlement strategies, and defenses
                         raised by USG to protect itself in
                         asbestos litigation and USG's decision
                         to join the Center for Claims
                         Resolution

Former employees of &    Operation, the CCR and USG's
counsel to the CCR       participation in the CCR, litigation
                         and settlement strategies in the
                         conduct of defense of asbestos
                         litigation against USG and other CCR
                         members

Former construction      Uses and application of USG's asbestos-
worker or taper          containing products

Plaintiffs' lawyer       Litigation and trial of cases against
                         USG in the tort system

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


WCI STEEL: Gets Court Nod to Enter Into Agreements with Praxair
---------------------------------------------------------------
WCI Steel, Inc. and its debtor-affiliates sought and obtained
permission from the U.S. Bankruptcy Court for the Northern
District of Ohio to enter into agreements with Praxair, Inc.

The Debtors obtained Bankruptcy Court authority to:

   1) enter into the COJET(R) Master Agreement to:

       i) purchase certain equipment through installment payments;
          and

      ii) to license certain proprietary and technical information
          in respect of a process to improve the efficient
          manufacture of steel

   2) enter into a Security Agreement granting Praxair a first
      priority security interest in certain equipment

Under the Master Agreement, the Debtors will purchase the
equipment from Praxair for $1,168,201 payable in monthly
installments.  Additionally, the Agreement will award the Debtors
rights to the licensed process and obligates Praxair to provide
services in respect of the licensed process and the equipment.

WCI Steel is an integrated steelmaker producing more than 185
grades of custom and commodity flat-rolled steel at its Warren,
Ohio facility.  WCI products are used by steel service centers,
convertors and the automotive and construction markets.  WCI Steel
filed for chapter 11 protection on Sept. 16, 2003 (Bankr. N.D.
Ohio Case No. 03-44662).  Christine M Pierpont, Esq., and G.
Christopher Meyer, Esq., at Squire, Sanders & Dempsey, L.L.P.,
represent the Company.  When WCI Steel filed for chapter 11
protection it reported $356,286,000 in total assets and
liabilities totaling $620,610,000.


WHEREHOUSE ENTERTAINMENT: Claim Objection Deadline is Now July 29
-----------------------------------------------------------------
The U.S. Bankruptcy Court for the District of Delaware extended
Wherehouse Entertainment, Inc., and its debtor-affiliates' time to
object to claims.   The Debtors has until July 29, 2005, to object
to:

   -- administrative expense claims,
   -- priority tax claims,
   -- other priority claims,
   -- secured trade claims, and
   -- other secured claims.

The Debtors have already filed eight omnibus claims objections
seeking to reduce and allow or expunge some administrative,
secured and priority claims.  The Debtors have also filed various
stipulations settling some significant administrative, secured and
priority claims.

The Debtors have also successfully reached consensual resolutions
with a variety of claimants without the need to file an objection
to those claims.

Kimberly D. Newmarch, Esq., at Richards, Layton & Finger, P.A., in
Wilmington, Delaware, tells the Court that the Debtor has only one
remaining employee to continue winding down the estates.  The
Debtors believe that the extension of time is reasonable and
necessary.

Headquartered in Torrance, California, Wherehouse Entertainment,
Inc., sells prerecorded music, videocassettes, DVDs, video games,
personal electronics, blank audio cassettes and videocassettes,
and accessories.  The Company and its debtor-affiliates filed for
chapter 11 protection on January 20, 2003, (Bankr. Del. Case No.
03-10224).  Mark D. Collins, Esq., and Paul Noble Heath, Esq., at
Richards Layton & Finger represent the Debtors in their
restructuring efforts.  When the Debtor filed for protection from
its creditors, it listed $227,957,000 in total assets and
$222,530,000 in total debts.


WILBAR REALTY: Aqua Pennsylvania Buys Some Assets for $1.6 Million
------------------------------------------------------------------
Aqua Pennsylvania Inc., a subsidiary of Aqua America, Inc.,
acquired four water systems and one wastewater system from the
bankruptcy estate of Wilbar Realty, Inc., a utility company that
filed for bankruptcy in April 2000.  Aqua acquired these five
utility systems, located in Luzerne County, for a combined
purchase price of approximately $1.6 million.

"By purchasing these systems, Aqua continues to support the
policies of various state public utility commissions that
encourage consolidation of smaller, and many times
undercapitalized, water systems to produce greater professionalism
and economies of scale for the industry," said Aqua America
Chairman and Chief Executive Officer Nicholas DeBenedictis.

The Pennsylvania Public Utility Commission (PUC) approved the
acquisition on June 23, 2005.  The purchase means that Aqua will
now provide:

   -- Water and wastewater services for the Laurel Lakes
      development in Rice Township, serving approximately 520
      residents.

   -- Water service for the Forest Park community in Bear Creek
      Township, serving approximately 220 residents.

   -- Water service for Penn Lake Park Borough, serving
      approximately 135 residents.

   -- Water service for the Saint Johns area in Butler Township,
      serving approximately 75 residents.

Aqua will invest approximately $1 million over the next three
years to upgrade the water and sewer systems.  "We look forward to
improving service for these customers by making needed capital
investments and by providing the financial and operational
expertise required to address the past problems," said Aqua Vice
President and Regional General Manager Anthony J. Donatoni.
"Furthermore, our new investments will permit the area to realize
its full future growth potential."

The capital projects include:

   -- rehabilitating the water and wastewater treatment systems;
   -- upgrading water distribution pipes, installing water meters;
   -- repairing water storage tanks;
   -- building new wells; and
   -- sewer collection system improvements.

Aqua is the largest subsidiary of Aqua America, Inc., and provides
water and wastewater service to approximately 1.3 million
residents across Pennsylvania.  Aqua America, Inc., is the largest
U.S.-based publicly traded water company in the country, serving
more than 2.5 million residents in 13 states.  Aqua America, Inc.
is listed on both the New York and Philadelphia Stock Exchanges
under the ticker symbol WTR.

Headquartered in Wilkes Barre, Pennsylvania, Wilbar Realty, Inc.,
filed for chapter 11 protection on Apr. 7, 2000 (Bankr. M.D. Penn.
Case No. 00-01242).  David J. Harris, Esq., in Wlkes Barre,
Pennsylvania, represented the Debtor in its chapter 11 proceeding.
The Court appointed Robert P. Sheils, Jr., Esq., as chapter 11
trustee.  Jill M. Spott, Esq., at Sheils Law Associates,
P.C.,represents Mr. Sheils.


W.R. GRACE: Reports Second Quarter Operating Results
----------------------------------------------------
W. R. Grace & Co. (NYSE:GRA) reported an increase in 2005 second
quarter sales of 18.2%, with sales totaling $676.5 million
compared with $572.4 million in the prior year quarter.  The
increase in sales was attributable to higher unit volumes in all
key geographic regions, improved product mix, selling price
increases to partially offset cost inflation, acquisitions and
favorable currency translation.  Grace reported second quarter net
income of $32.7 million, or $0.49 per diluted share, compared with
net income of $21.3 million, or $0.32 per diluted share, in the
second quarter of 2004.  Net income for the second quarter of 2005
includes income from two Bankruptcy Court approved insurance
settlements, offset by higher interest expense to conform to rates
in Grace's proposed Chapter 11 plan of reorganization and higher
legal costs related to Chapter 11 and other litigation
proceedings.  Pre-tax income from core operations in the second
quarter of 2005 was $56.6 million compared with $49.3 million in
the second quarter of 2004, a 14.8% increase.  The pre-tax results
from core operations reflect added profit from higher sales and
from productivity improvements, which together more than offset
increases in raw materials, energy and certain operating expenses.

"Our company continued to deliver strong sales and earnings growth
in the second quarter," said Grace's President and Chief Executive
Officer Fred Festa.  "Higher sales more than offset double-digit
increases in the cost of raw materials and energy.  We expect raw
material costs to continue at high rates over the rest of the year
and the favorable effects of currency and acquisitions to
moderate.  In response, we will continue our ongoing efforts to
grow our revenue base and to lower our cost structure by
integrating our operations and improving the effectiveness of our
business processes."

For the first six months of 2005, Grace reported sales of
$1,279.7 million, a 17.3% increase over 2004.  The year-to-date
increase was largely attributable to the same favorable factors
that affected second quarter sales.  Net income through June 2005
was $35.8 million, or $0.53 per diluted share, compared with net
income of $37.1 million, or $0.56 per diluted share, for the six
months ended June 2004.  Net income was down slightly period-over-
period, as higher 2005 pre-tax income from core operations was
more than offset by higher interest expense and legal costs.  Core
operating income was $96.3 million for the first six months of
2005 compared with $87.8 million in the prior year period, a 9.7%
increase.  The increase was principally attributable to strong
sales volume growth (including acquisitions and a better product
mix), higher selling prices to partially offset the  impact of
cost inflation, and favorable foreign currency translation.

                        Core Operations

Davison Chemicals

Second quarter sales for the Davison Chemicals segment were
$358.9 million, up 20.5% from the prior year quarter, mainly
reflecting strong global demand for transportation fuels, higher
selling prices to partially offset increases in raw materials and
energy costs, and acquisitions.  Excluding the effects of
favorable currency translation, sales were up 18.1%.  Sales of
refining technologies products, which include fluid cracking
catalysts, hydroprocessing catalysts and performance additives
used in petroleum refining, were $213.3 million in the second
quarter, up 26.6% compared with the prior year quarter.  The
increase resulted from volume gains in response to high worldwide
demand for catalysts that enhance refinery through-put, upgrade
crude oil feedstocks and help produce cleaner fuels, and added
revenue from the contractual pass-through of commodity metals
costs.  Sales of specialty materials products, which include
silica-based engineered materials, specialty catalysts, and
products used for drug discovery and purification, were $145.6
million, up 12.6% compared with the second quarter of 2004.  The
increase was primarily attributable to sales from the acquisition
of Alltech International Holdings, Inc., completed in August 2004,
increases in selling prices and a better product sales mix to
address raw material inflation, and favorable currency
translation; offset by lower sales of engineered materials in
Europe as a result of lower economic activity in parts of that
region.

Operating income of the Davison Chemicals segment for the second
quarter of 2005 was $43.1 million compared with $37.5 million in
the 2004 second quarter, a 14.9% increase.  Operating margin was
12.0%, about 0.6 percentage points lower than the prior year
quarter.  The increase in operating income was attributable to
higher sales volume and a more profitable sales mix in refining
technologies products, selling price increases to partially offset
higher raw materials and energy costs, accretive acquisition
results, and favorable foreign currency translation and commodity
contracts; offset by costs to further integrate business functions
and processes.

Sales of the Davison Chemicals segment for the first six months of
2005 were $693.6 million, up 22.0% from 2004 (19.6% after
accounting for favorable currency translation).  Year-to-date
operating income was $80.8 million, compared with $69.5 million
for the prior year, a 16.3% increase, with operating margins at
11.6% compared with 12.2% last year.  Year-to-date operating
results reflect similar economic conditions and cost factors as
those experienced in the second quarter.

Performance Chemicals

Second quarter sales for the Performance Chemicals segment were
$317.6 million, up 15.7% from the prior year quarter primarily a
result of strong growth in unit volumes worldwide and increases in
selling prices to offset higher raw material costs.  Favorable
currency translation accounted for 2.5 percentage points of the
increase.  Sales of specialty construction chemicals, which
include concrete admixtures, cement additives and masonry
products, were $159.4 million, up 18.1% versus the year-ago
quarter.  Sales were up in all regions, mainly reflecting
geographic expansion and other growth initiatives, and stronger
construction activity, particularly in North America.  Sales of
specialty building materials, which include waterproofing and fire
protection products, were $79.2 million, up 14.6% compared with
the second quarter of 2004.  The second quarter reflects strong
sales of roofing underlayments, particularly in North America,
added sales of waterproofing materials from the acquisition of the
TRI-FLEX 30(R) synthetic roofing underlayment product line in
December 2004, and higher sales of specialty below-grade
waterproofing worldwide; partially offset by lower sales of fire
protection products compared with a strong second quarter of 2004.
Sales of specialty sealants and coatings, used in rigid food
packaging, were $79.0 million, up 12.1% compared with the second
quarter of 2004.  Sales were up in all regions due to higher
volumes and selling price increases implemented to offset higher
raw material costs, with sales of Daraform(R) closure sealants and
can coatings accounting for most of the growth.

Operating income for the Performance Chemicals segment was
$45.7 million in the second quarter of 2005 compared with
$38.9 million for 2004, a 17.5% increase.  Operating margin of
14.4% was 0.2 percentage points higher than the second quarter of
last year.  Higher operating income and margins were primarily a
result of added volume and selling price increases to partially
offset higher raw material costs.

Sales of the Performance Chemicals segment for the six months
ended June 2005 were $586.1 million, up 12.2% from 2004 (9.8%
excluding currency translation effects).  Year-to-date operating
income was $73.0 million compared with $66.5 million for the prior
year, a 9.8% increase, reflecting strong sales volumes in all
geographic regions, higher selling prices implemented to offset
inflation in raw material costs, and positive results from
productivity and cost containment initiatives.  Operating margin
was 12.5% compared with 12.7% for the first six months of last
year.

Corporate Costs and Other Matters

Second quarter corporate costs related to core operations were
$32.2 million compared with $27.1 million in the prior year
quarter, and $57.5 million year-to-date compared with
$48.2 million last year.  The second quarter and year-to-date
increases were attributable primarily to higher pension expense
that reflects updated assumptions for expected life-spans, the
longevity of Grace's active work force, and amortization of
deferred costs related to capital market returns in recent years.

The second quarter financial results include approximately
$20 million of income and cash proceeds from the settlement of two
disputes with insurance carrier groups with respect to coverage
for past environmental remediation and asbestos-related costs.

As previously disclosed, Grace and current and former employees
are defendants in a criminal proceeding related to former
vermiculite mining operations in Montana, and Grace and two
employees are defendants in a civil suit which was filed in the
second quarter of 2005 related to the clean-up of a former
vermiculite processing site in New Jersey.  Grace's second quarter
and year-to-date financial statements include $3.2 million and
$9.2 million, respectively, of legal costs for the defense of the
Company and the named individuals with respect to these lawsuits.
At this time, Grace cannot predict the outcome of these lawsuits
or the extent of any financial impact.  Defense costs are being
expensed as incurred.

Also as previously disclosed, Grace's amended proposed plan of
reorganization provides for interest on general unsecured claims -
- not payable until a plan is confirmed -- at rates that generally
range from 4.19% to 6.09%.  Such rates were applied to Grace's
estimate of eligible claims for the six months ended
June 30, 2005, increasing year-to-date interest expense by
approximately $20 million.

                     Cash Flow and Liquidity

Grace's net cash flow from operating activities was a
negative ($78.8) million for the first six months of 2005,
compared with a positive cash flow of $85.8 million for the
comparable period of 2004.  The year-to-date 2005 cash flow
included a payment of $90.0 million to resolve U.S. federal tax
return audits for the 1993-1996 tax periods, a payment of $21.4
million to resolve an environmental contingency at a formerly
owned site, and a payment of $10.5 million to roll-forward
dollar-to-euro currency contracts.  Year-to-date 2005 pre-tax
income from core operations before depreciation and amortization
was $153.7 million, 8.8% higher than 2004, a result of the higher
income from core operations.  Cash used for investing activities
was $16.0 million for the first six months of 2005, reflecting
capital replacements and acquisition investments, partially
offset by proceeds from the termination of life insurance
policies.

At June 30, 2005, Grace had available liquidity in the form of
cash ($404.0 million), net cash value of life insurance
($81.3 million) and unused credit under its debtor-in-possession
facility ($212.5 million).  Grace believes that these sources and
amounts of liquidity are sufficient to support its business
operations, strategic initiatives and Chapter 11 proceedings for
the foreseeable future.

W. R. Grace & Co. and Subsidiaries
Consolidated Balance Sheets
(Unaudited, in Millions)
==================================           June. 30, Dec. 31,
                                                2005      2004
                                             --------  --------
ASSETS
Current Assets
Cash and cash equivalents                      $404.0    $510.4
Trade accounts receivable, net                  435.4     390.9
Inventories                                     266.4     248.3
Deferred income taxes                            21.7      16.3
Other current assets                             54.8      62.6
                                             --------  --------
Total Current Assets                          1,182.3   1,228.5

Properties and equipment, net                   599.7     645.3
Goodwill                                        104.0     111.7
Cash value of life insurance policies, net       81.3      96.0
Deferred income taxes                           675.0     667.4
Asbestos-related insurance expected to be
   realized after one year                      500.0     500.0
Other assets                                    281.0     290.0
                                             --------  --------
Total Assets                                 $3,423.3  $3,538.9
                                             ========  ========

LIABILITIES AND SHAREHOLDERS' EQUITY (DEFICIT)
Liabilities Not Subject to Compromise
Current Liabilities
Debt payable within one year                    $11.0     $12.4
Accounts payable                                160.2     146.0
Income taxes payable                             13.7       7.7
Other current liabilities                       186.5     221.5
                                             --------  --------
Total Current Liabilities                       371.4     387.6

Debt payable after one year                       0.5       1.1
Deferred income taxes                            58.3      64.1
Unfunded defined benefit pension liability      438.6     424.9
Other liabilities                                49.4      75.3
                                             --------  --------
Total Liabilities Not Subject to Compromise     918.2     953.0

Liabilities Subject to Compromise
Prepetition debt plus accrued interest          664.8     645.8
Accounts payable                                 31.3      31.3
Income tax contingencies                        143.2     210.4
Asbestos-related liability                    1,700.0   1,700.0
Environmental remediation                       320.6     345.0
Post-retirement benefits                        185.3     196.3
Other liabilities                                65.2      78.9
                                             --------  --------
Total Liabilities Subject to Compromise       3,110.4   3,207.7
                                             --------  --------
Total Liabilities                             4,028.6   4,160.7
                                             --------   -------

Shareholders' Equity (Deficit)
Common stock                                      0.8       0.8
Paid-in capital                                 423.4     426.5
Accumulated deficit                            (537.4)   (573.2)
Treasury stock, at cost                        (119.7)   (125.9)
Accumulated other comprehensive loss           (372.4)   (350.0)
                                            ---------  --------
Total Shareholders' Equity (Deficit)           (605.3)   (621.8)
                                            ---------  --------
Total Liabilities and Shareholders'
   Equity (Deficit)                          $3,423.3  $3,538.9
                                            =========  ========


W. R. Grace & Co. and Subsidiaries
Consolidated Statement of Operations         Three Months Ended
(Unaudited, in Millions)                           June 30,
==================================           ==================
                                                2005      2004
                                             --------  --------
Net sales                                      $676.5    $572.4
                                             --------  --------

Cost of goods sold, exclusive of
   depreciation and amortization                439.7     357.2
Selling, general and administrative
   expenses, exclusive of
   net pension expense                          119.4     111.4
Depreciation and amortization                    28.6      26.3
Research and development expenses                15.1      13.0
Net pension expense                              19.5      16.1
Interest expense and related financing costs     13.3       3.9
Other (income) expense                          (23.9)      4.6
                                             --------  --------
                                                611.7     532.5
Income (loss) before Chapter 11 expenses,
   income taxes and minority interest            64.8      39.9

Chapter 11 expenses, net                         (4.6)     (3.0)
Benefit from income taxes                       (20.0)    (13.0)
Minority interest in consolidated entities       (7.5)     (2.6)
                                             --------  --------
Net income (loss)                               $32.7     $21.3
                                             ========  ========


W. R. Grace & Co. and Subsidiaries
Consolidated Statement of Cash Flows         Six Months Ended
(Unaudited, in Millions)                          June 30,
==================================           =================
                                               2005      2004
                                             -------   -------
OPERATING ACTIVITIES
Income before Chapter 11 expenses,
   income taxes & minority interest            $86.0      $71.6

Reconciliation to net cash provided
by operating activities:
Depreciation and amortization                   57.4       53.5
Interest accrued on pre-petition debt
   subject to compromise                        25.4        5.4
Net (gain) loss on sale of investments and
   disposals of assets                          (0.5)       0.3
Provision for bad debt expense                   0.9        1.1
Income from life insurance policies, net        (1.9)      (2.2)
Payments to fund defined benefit pension plans (13.2)      (5.2)
Payments under post-retirement benefit programs (5.1)      (5.5)
Expenditures for environmental remediation      (3.0)      (2.9)
Expenditures for retained obligations of
   discontinued operations                      (4.2)      (0.7)
Changes in assets and liabilities, excluding
   effect of businesses acquired/divested and
   foreign currency translation:
      Working capital items                    (75.0)     (55.8)
      Other accruals and non-cash items         (5.7)      46.1
                                             -------   --------
Net cash provided by (used for) operating
   activities before income taxes and
   Chapter 11 expenses                          61.1      105.7
Cash paid to settle contingencies through
   Chapter 11 proceedings                     (119.7)         -
Chapter 11 expenses paid, net                   (9.0)      (6.1)
Income taxes paid, net of refunds              (11.2)     (13.8)
                                             -------   --------
Net cash provided by (used for) operating
   activities                                  (78.8)      85.8

INVESTING ACTIVITIES
Capital expenditures                           (31.3)     (22.5)
Business acquired, net of cash acquired         (2.2)         -
Proceeds from life insurance policies           14.8          -
Net investment in life insurance policies        0.1      (11.4)
Proceeds from life insurance policies            2.3       10.5
Proceeds from sales of investments
   and disposals of assets                       0.3        1.3
                                             -------   --------
Net cash provided by (used for)
   investing activities                        (16.0)     (22.1)

FINANCING ACTIVITIES
Net payments of loans secured by cash
   value of life insurance policies             (0.6)      (2.7)
Borrowings under credit facilities, net         (1.2)       6.3
Borrowings under DIP facility, net              (1.1)      (1.0)
Exercise of stock options                        3.0        0.2
                                             -------   --------
Net cash provided by (used for) financing
   activities                                    0.1        2.8
                                             -------   --------

Effect of currency exchange rate changes
   on cash and cash equivalents                (11.7)      (4.0)
                                             -------   --------
Increase (decrease) in cash and
   cash equivalents                           (106.4)      62.5
Cash & cash equivalents, beginning of period   510.4      309.2
                                             -------   --------
Cash & cash equivalents, end of period        $404.0     $371.7
                                             =======   ========

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


YES! ENTERTAINMENT: Trustee Wants Entry of Final Decree Delayed
---------------------------------------------------------------
The Executive Sounding Board Associates, Inc., the trustee of the
YES! Entertainment Corp. Liquidating Trust overseeing the
liquidation of YES! Corp.'s assets, requests another delay in the
entry of a final decree closing the Debtor's chapter 11 case.

The Trustee wants the U.S. Bankruptcy Court for the District of
Delaware to authorize the extension through Dec. 31, 2005, because
it can't make a final distribution until the pending adversary
proceeding filed against Wham-O is resolved.  A trial has been
held in the Wham-O action and the parties are currently awaiting
the Court's judgment.

As reported in the Troubled Company Reporter on June 15, 2005,
YES! Entertainment sold its Food and Girls Activity business units
to Wham-O, Inc., in 1998 in exchange for:

    -- a $9.8 million up-front cash payment;

    -- up to $600,000 more pending a final inventory
       reconciliation;

    -- a $2.5 million contingency payment to be earned based upon
       certain performance criteria for the Food line in the
       first year, and

    -- royalties of up to $5.5 million over a seven-year period.

Objections to the proposed extension must be filed with the Court
by 4:00 p.m. on Aug. 5, 2005

The Trustee assures the court that the delay will not prejudice
any party in the Debtor's bankruptcy case.

Headquartered in Pleasonton, California, Yes! Entertainment
Corporation, developed, manufactured and marketed toys and other
entertainment and interactive products.  The Company filed for
chapter 11 protection on February 9, 1999 (Bankr. D. Del. Case No.
99-273).  Anthony M. Saccullo, Esq., and Jeffrey M. Schlerf, Esq.,
at The Bayard Firm represented the Debtor.  When the Debtor filed
for protection from its creditors, it listed $18,635,000 in total
assets and $19,680,000 in total debts.  Blank Rome Comisky &
McCauley, LLP, and Squadron Ellenoff Plesent & Sheinfeld LLP
represented the Official Committee of Unsecured Creditors.  On
December 11, 2001, the Honorable Mary F. Walrath confirmed a First
Amended Plan of Reorganization.  In April 2002, the Plan became
effective.


* The Altman Group Completes Transition to Full Service Agency
--------------------------------------------------------------
The Altman Group, the fastest growing proxy solicitation firm in
the United States and winner of the 2004 TOPS Award as the Highest
Rated Proxy Solicitation Firm, recently added Investor Relations
to the services it offers its closed-end mutual fund clients,
completing its transition to a full-service agency.  Aside from
The Altman Group's already established range of proxy solicitation
services, it now has an entire team dedicated solely to closed-end
funds, offering investor relations, public relations, media
relations, proxy solicitation and shareholder identification
specific to closed-end fund clients.

"The Altman Group is one of the premier proxy solicitation,
corporate governance and bankruptcy services firms in the United
States," said Ken Altman, President of The Altman Group.  "Many of
our key executives, including myself, come from an investor
relations background.  It simply makes sense to provide the same
outstanding level of service and knowledge that earned us the TOPS
Award as Highest Rated Proxy Solicitation Firm to our closed-end
mutual fund clients in need of investor communications services."

"Our 30+ closed-end fund clients have expressed to us a desire to
consolidate their needs for shareholder ID, proxy, investor
communications and media relations," continued Mr. Altman.  "We
see an opportunity to help companies reduce their costs while
providing the highest level and quality of service available."

Since it began offering focused investor relations services
earlier this year, The Altman Group has already signed on eight
new clients for investor, public and media relations programs.
"This is an ideal combination of expertise and services to bring
together," said Patricia Baronowski, Director of Investor
Relations for The Altman Group.  "We have the experience, ability
and all of the resources required to meet each client's needs."

These investor relations services are intended to tie in with the
Corporate Actions Reports and the Dissident Actions Reports
produced by Warren Antler, head of The Altman Group's Closed-End
Mutual Funds Division.  These reports are free to clients and are
have been well received by the closed-end fund community.

"We believe this is a very unique package of services," said
Warren Antler.  "Nobody else offers all of these services under
one roof.  Our approach not only helps to better integrate all
shareholder-related services, but it also results in lower fees
and more management coordination for our clients."

The Altman Group's clients include Fortune 500 companies, national
and international closed-end funds, emerging market clients and
international corporations and institutions.

The Altman Group now provides:

   -- Bankruptcy Administration Services
   -- Corporate Proxy Solicitation Services
   -- Mutual Fund Proxy Services
   -- Limited Partnership Proxy Services
   -- Shareholder Identification Services
   -- Investor Relations, Public Relations and Media Relations for
      closed-end mutual funds


* BOOK REVIEW: Corporate Recovery: Managing Cos. in Distress
------------------------------------------------------------
Author:     Stuart Slatter and David Lovett
Publisher:  Beard Books
Softcover:  356 pages
List Price: $34.95

Order your personal copy at
http://amazon.com/exec/obidos/ASIN/1587982420/internetbankrupt

Slatter and Lovett write a "practical reference guide for
turnaround management [describing] what must be done and how to do
it."  According to these authors with unmatched experience in
working with distressed corporations, "turnaround management is
everyday management."  There are no miraculous remedies for
bringing a company out of its troubles; no formulas to apply which
will guarantee recovery.  Yet, as every business manager knows--
and what the authors are leading to--is everyday management is
not, and cannot remain the same day to day. Management has to be
alert enough and flexible enough to adapt to ever-changing
business conditions both outside of and within a company. "Crisis
management" is not a specialized type of management, nor a gifted
set of management skills.  Although it is often regarded as this
by many in the business field and portrayed as this in the media.
Slatter's and Lovett's approach is that any good manager should
have the skills to be able to move his or her company toward
recovery. Managers often fail in this not because they lack the
relevant management skills, but because they did not recognize or
acknowledge the warning signs of a crisis.  In this case,
management is failing to adapt to a corporation's changing
circumstances.

"Corporate Recovery" does not teach managers how to become "crisis
managers"; although it does advise on what management skills
should come into play if a company does slip into a crisis. But
the authors for the most part take a broader view.  They
emphasize, for example, that crisis is always a possibility
because of the reality of business cycles. No company is immune to
the ups and downs, the to and fro, the changes of business cycles.
"Crisis management"--or "turnaround management" as the authors
call it in places--"involves applying traditional management
techniques in a rather unusual environment.  The patient is
seriously ill, both cash and time are in short supply, and rapid
recovery is required." This is true in a crisis when there is no
choice but turnaround if a company is to survive.  But in keeping
with their perspective that good management inherently has the
skills required for turnaround, the authors suggest that such
skills are also apropos when a company has newly been acquired and
is inevitably undergoing some changes, improvement of short-time
financial performance is sought, and a company is trying to head
off a crisis it sees coming rather than pull itself out of one.

The authors' expertise on turnarounds is evident not only in the
clarity of their writing, but also the discrete topics of their
chapters and the logic of their order.  An early chapter on
"Symptoms and Causes of Decline" is followed by one on
"Characteristics of Crisis Situations." "If no attempt is made to
reverse the causes of decline..., a crisis situation will
develop."  Crises can originate either externally as "threatening
events in a firm's environment" or internally as "defects within
the organization."  In many cases, unrecognized or unaddressed
symptoms of decline leading to a crisis come about from a
combination of external and internal factors.  As commonly defined
in management literature, a crisis is a "situation that threatens
the high-priority goals of the organization [i. e., its survival],
restricts the amount of time available for response, and surprises
decision-makers by its occurrence, thereby engendering high levels
of stress."

The authors give equal attention to both external and internal
factors, and also attention to their inter-relationship.  The
reader is taken chapter by chapter through all of the stages of
distress in a company, from early warning signs through pervasive
problems to moving onto solid ground and emerging from a
turnaround, hopefully wiser and stronger.  The authors' acute
analyses of the distinguishing factors of each stage, as
enlightening as it is, are not academic.  As mentioned above,
their aim is guidance on relevant, effective action in each
particular stage of distress.  Different stages require different
actions.  Under circumstances of distress, whatever ones a company
is facing, from relatively mild to severe and life-threatening,
the enthusiasm and moral which are signs of a healthy company in
normal times cannot get to the causes of the problems.  Ordinary
leadership skills such as setting a good example and inspiring
loyalty will not effect a turnaround.  What is fundamental in a
successful turnaround, the authors come back to again and again
from different angles, is the decisions made and actions taken by
a company's key decision-makers. Only they are in a position to
make the crucial decisions which can bring an organization out of
distress by a turnaround.

"Corporate Recovery" is an incomparable guide for decision-makers
in companies in distress. In brings clarity to what is commonly a
clouded, disturbing, and stressful situation, even for the most
experienced decision-makers.  Study of it can help an
organization's decision-makers ward off or minimize hazards to its
well-being.  For ones who find themselves already in worrisome
crisis situations, it can be an invaluable handbook on how to deal
with these no matter what stage they have reached or what form
they have taken.

Founding member of the Society of Turnaround Professionals, Stuart
Slatter is also the founder of firms working with corporations on
turnarounds and providing training for managers and executives on
this. He also has extensive international corporate and academic
experience. David Lovett, too, has extensive experience in these
areas, and heads his own firm helping companies improve their
operations and financial performance and restore or increase
corporate value.

                          *********

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 Junior M.
Pinili, 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 ***