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      T R O U B L E D   C O M P A N Y   R E P O R T E R

         Thursday, August 11, 2005, Vol. 9, No. 189

                          Headlines

360NETWORKS: Five Adversary Proceedings Submitted for Mediation
AAIPHARMA INC: Court Okays Committee Hiring Reed Smith as Counsel
AAIPHARMA INC: Panel Gets Court Nod to Hire J.H. Cohn as Advisor
AAIPHARMA INC: Wants Until Nov. 8 to Decide on Unexpired Leases
ACANDS INC: Exclusive Plan Filing Period Intact Until Oct. 18

ACANDS: Secures Open-Ended Deadline to File Notices of Removal
ACCERIS COMMS: Equity Deficit Widens to $77.4 Million at June 30
ACTUANT CORP: Declares $0.08 Annual Dividend per Common Share
ADVANCED FIBER: Negotiating with Lenders on EBITDA Default Waiver
ALION SCIENCE: S&P Revises Outlook to Negative from Stable

ALLIED HOLDINGS: Court Allows Payment of Insurance Premiums
AMERICA WEST: Shareholders Will Vote on US Air Merger on Sept. 13
AMERICAN BUSINESS: Chapter 7 Trustee Wants to Continue Operations
AMERICAN BUSINESS: Trustee Wants More Time to Decide on Pa. Lease
AMERICAN ITALIAN: Internal Audit Review Delays Quarterly Reporting

AMERICAN ITALIAN: Talking to Bank Lenders to Amend Credit Pacts
AMPEX CORPORATION: June 30 Balance Sheet Upside-Down By $89 Mil.
ANCHOR GLASS: Nasdaq Will Halt Securities Trading on Aug. 17
ANCHOR GLASS: Moody's Junks $350 Million Senior Secured Notes
ANCHOR GLASS: S&P Lowers Corporate Credit & Sr. Sec. Ratings to D

ARCH COAL: Moody's Affirms $145 Mil. Preferred Stock Rating at B3
ASARCO LLC: Grupo Mexico Unit Files for Chapter 11 in S.D. Tex.
ASARCO LLC: S&P Lowers Corporate Credit Rating to D from CCC
ASARCO LLC: Fitch Downgrades Senior Unsecured Debt Rating to C
ASARCO LLC: Case Summary & 20 Largest Unsecured Creditors

BALLY TOTAL: Moody's Affirms Junk Corporate Family & Debt Ratings
BEAR STEARNS: Fitch Lifts Rating on $16MM Certs. 1 Notch to BBB-
BEAR STEARNS: Fitch Upgrades Two Low-B Rated Certificate Classes
BIOLASE INC: BDO Seidman Replaces PwC as Independent Auditors
BLOCKBUSTER INC: Lenders Waive Covenant Violations & Secure Loans

BLOCKBUSTER INC: Posts $57.2 Million Net Loss in Second Quarter
BUEHLER FOODS: Has Until Sept. 6 to Make Lease-Related Decisions
CAMCO INC: Equity Deficit Narrows to $13.9 Million at June 25
CATHOLIC CHURCH: Portland Court Names Judge Dunn as Pre-Mediator
CENTRAL PARKING: Earns $5.3 Million of Net Income in Third Quarter

CENTURY/ML: Claims Classification & Treatment Under Ch. 11 Plan
CHARTER COMMS: Neil Smit Succeeds Robert May as President & CEO
CHEMED CORP: Reports Second Quarter Operating Results
CITISTEEL USA: S&P Rates Proposed $170 Million Notes at CCC+
COLLINS & AIKMAN: Plastech Offers $1 Billion to Buy Assets

CONGOLEUM CORP: Confirmation Hearing Set for December 13
CONGOLEUM CORP: June 30 Balance Sheet Upside-Down by $35.9 Million
CONSECO INC: Completes Offering of 3.50% Convertible Debentures
DENBURY RESOURCES: Reports 2nd Qtr. Financial & Operating Results
DP 8 LLC: Court OKs Vanderbilt Farm's Amended Disclosure Statement

DRUG ASSIST: Voluntary Chapter 11 Case Summary
E*TRADE FINANCIAL: Buying BMO Financial's Harrisdirect for $700MM
EASYLINK SERVICES: Issues 425K Shares in QuickStream Acquisition
EXTENDICARE INC: Earns $25.2 Mil. of Net Income in Second Quarter
FAIRFAX FINANCIAL: S&P Affirms BBB Counterparty Credit Rating

FASSBERG CONSTRUCTION: Hires Horvitz & Levy as Appellate Counsel
FASSBERG CONSTRUCTION: Retains Hunt Ortmann as Special Counsel
FINANCIAL INSTITUTIONS: Posts $12 Million Net Loss in 2nd Quarter
FLYI INC: Says Cash Flow Woes May Soon Force a Bankruptcy Filing
FLYI INC: June 30 Balance Sheet Upside-Down by $29.4 Million

FREEDOM MEDICAL: Files Disclosure Statement in Pennsylvania
FRIENDLY ICE: Balance Sheet Upside-Down by $105 Million at July 3
HIGH POINT: Gets Waivers from Lenders on Covenant Defaults
ICOS CORP: Balance Sheet Shows $57 Mil. Equity Deficit at June 30
INTEGRATED ELECTRICAL: Posts $13.9 Million Net Loss in 3rd Quarter

INTEGRATED HEALTH: Wants Entry of Final Decree Delayed to Nov. 3
INTELIDATA TECH: Posts $1.4 Million Net Loss in Second Quarter
INTELIDATA TECH: Stockholders to Vote on Merger Pact Next Week
JUNCOS AL: Case Summary & 10 Largest Unsecured Creditors
KMART CORP: Settles Lease & Cure Claims Dispute on 10 Stores

LAMAR MEDIA: Moody's Rates New $400 Million Sr. Sub. Notes at Ba3
LAMAR MEDIA: S&P Rates Proposed $400 Million Sr. Sub. Notes at B
LANTIS EYEWEAR: Judge Gropper Confirms Liquidating Chapter 11 Plan
MARKWEST ENERGY: Earns $700,000 of Net Income in Second Quarter
MCI INC: Will Acquire Totality Corp.

MCLEODUSA INC: June 30 Balance Sheet Upside-Down by $380 Million
METALLURG INC: Prepays $18.4 Million of Term Loan
MORGAN STANLEY: Increased Subordination Cues Fitch to Lift Rating
NORTEL NETWORKS: Posts $45 Million Net Income in Second Quarter
NRG ENERGY: Earns $23.9 Million of Net Income in Second Quarter

OCCAM NETWORKS: June 30 Balance Sheet Upside-Down by $18 Million
ORMET CORP: Union Outrage Bursts Over Property Tax Payment Refusal
PATRIOT MEDIA: S&P Rates Planned $282 Million Facilities at Low-Bs
PLASTECH ENGINEERED: Offers $1 Billion for Collins & Aikman
PROVIDENT PACIFIC: Wants Stay Lifted to Foreclose on Property

PROXIM CORP: Proposes Key Employee Retention & Incentive Program
RECYCLED PAPERBOARD: Auction Rescheduled to August 17
REDDY ICE: Prices 10.2 Million Equity Issue at $18.50 Per Share
RUFUS INC: Files for Chapter 11 Protection in Delaware
RUFUS INC: Case Summary & 20 Largest Unsecured Creditors

RUSH RODEO: Voluntary Chapter 11 Case Summary
SAINT VINCENTS: Agrees to Return Escrow Balance to GE Capital
SAINT VINCENTS: Nurses' Association Wants Wage Hike Implemented
SAINT VINCENTS: Resolves Sun Life Cash Collateral Dispute
SHOPKO STORES: Stockholders to Vote on Merger at Sept. 14 Meeting

SIERRA PACIFIC: S&P Rates Planned $225 Million Senior Notes at B-
SIRVA INC: S&P Lowers Corporate Credit Rating to B+ from BB
SOUTHAVEN POWER: Erie Power Wants Creditors Committee Appointed
TITAN CORP: Moody's Downgrades $200 Million Sr. Sub. Notes to B3
TOM'S FOODS: Hires Deloitte & Touche as Auditor and Accountant

TOUCH AMERICA: Settles Level 3's Administrative & Unsecured Claims
TOUCH AMERICA: Wants to Recover $781,118 in Preferential Transfers
TWINLAB CORP: Bankr. & Dist. Courts Confirm Plan of Liquidation
UNITED RENTALS: Reports Preliminary Second Quarter 2005 Earnings
UNIVERSAL HOSPITAL: June 30 Balance Sheet Upside-Down by $94 Mil.

US AIRWAYS: Terms of Second Amended Plan of Reorganization
VARELA ENTERPRISES: Confirmation Hearing Set for Sept. 9
WATTSHEALTH FOUNDATION: Section 341(a) Meeting Slated for Aug. 16
WATTSHEALTH FOUNDATION: Taps Alvarez & Marsal as Restr. Advisors
WESTPOINT STEVENS: Completes $703.5 Mil. Sale to WestPoint Int'l

WESTPOINT STEVENS: R2 Top Hat Balks at Disclosure Statement
WESTPOINT STEVENS: Steering Board Asks for Re-Evaluation Hearing
WISTON XIV: U.S. Trustee Wants Bankruptcy Case Dismissed
YUKOS OIL: Losses in 2nd Quarter 2005 Exceed Rub4 Billion
Z-1 CDO: Fitch Holds Junk Rating on $21MM Class B Certificates

* Edmund Cooke Joins Mintz Levin's Washington D.C. Office

                          *********

360NETWORKS: Five Adversary Proceedings Submitted for Mediation
---------------------------------------------------------------
Five defendants to adversary proceedings commenced by the
Official Committee of Unsecured Creditors of 360networks (USA)
Inc., agreed to have their cases submitted for mediation:

      * Cisco Systems, Inc.;
      * Graphicpoint, Inc.;
      * NKF Kabel;
      * Schooley Caldwell Associates; and
      * The Sinclair Group, Inc.

The Court authorizes the Creditors Committee to submit the
Actions to a mediator for mediation pursuant to Rule 9019-1 of the
Local Bankruptcy Rules for the Southern District of New York and
General Order M-143, as further expanded by General Order M-211.

The Court further rules that pursuant to Section 3.1 of General
Order M-143, the time and place of an initial mediation conference
for each of the Mediation Actions will be determined by the
mediator upon consultation with all attorneys for the Mediation
Action parties.

The costs and expenses that are to be paid to the mediator in each
of the Mediation Actions will be shared equally between the
Creditors Committee and the Debtors, on one hand, and each
Mediation Defendant, on the other hand.

Moreover, with respect to the Creditors Committee and the
Debtors' obligations for the Mediation Expenses, all costs will be
paid from the Preference Account, as defined in the Debtors' First
Amended Joint Plan Of Reorganization.  The Creditors Committee and
the Debtors will not have any liability in respect of any of the
Mediation Expenses.

Headquartered in Vancouver, British Columbia, 360networks, Inc. --
http://www.360.net/-- is a leading independent provider of fiber  
optic communications network products and services worldwide.  The
Company and its 22 debtor-affiliates filed for chapter 11
protection on June 28, 2001 (Bankr. S.D.N.Y. Case No. 01-13721),
obtained confirmation of a plan on October 1, 2002, and emerged
from chapter 11 on November 12, 2002. Alan J. Lipkin, Esq., and
Shelley C. Chapman, Esq., at Willkie Farr & Gallagher, represent
the Company before the Bankruptcy Court.  When the Debtors filed
for protection from its creditors, they listed $6,326,000,000 in
assets and $3,597,000,000 in liabilities.  (360 Bankruptcy News,
Issue No. 86; Bankruptcy Creditors' Service, Inc., 215/945-7000)


AAIPHARMA INC: Court Okays Committee Hiring Reed Smith as Counsel
-----------------------------------------------------------------
The Honorable Peter J. Walsh of the U.S. Bankruptcy Court for the
District of Delaware gave permission to the Official Committee of
Unsecured Creditors appointed in aaiPharma Inc. and its debtor-
affiliates' chapter 11 cases to hire Reed Smith LLP as its
bankruptcy counsel, nunc pro tunc to May 24, 2005.

On May 24, 2005, the U.S. Trustee for Region 3 appointed five
creditors to serve on the Committee:

   (a) Roxane Laboratories, Inc.;
   (b) Novartis Pharmaceuticals;
   (c) AmerisourceBergen Corporation;
   (d) Fine Chemicals Corporation; and
   (e) TMP Worldwide.

AmerisourceBergen Corporation chairs the Committee.

Reed Smith is an international law firm with almost 1,000
attorneys in 17 offices in the United States, the United Kingdom,
and Germany.

The Committee selected Reed Smith because the Firm has experience
in cases and proceedings related to the Bankruptcy Code.  The
Committee believes that Reed Smith will effectively represent the
Committee in the Debtors' bankruptcy cases.

Reed Smith will:

   (a) consult with the U.S. Trustee or the Debtors concerning the
       administration of the Debtors' bankruptcy cases;

   (b) investigate the acts, conduct, assets, liabilities, and
       financial condition of the Debtors, the operation of the
       Debtors' business and the desirability or the continuance
       of such businesses, and any other matter relevant to the
       Debtors' bankruptcy cases or to the formulation of one or
       more plans;

   (c) evaluate with the Debtors any offers to purchase the assets
       or businesses of the Debtors and participate in the sales
       process;

   (d) participate in the formulation of one or more plans, advise
       the representatives of any committee's determinations as to
       the plan formulated, and collect and file with the Court
       the acceptances or rejections of those plans;

   (e) if appropriate, request the appointment of one or more
       Trustees or examiners under Section 1104 of the U.S.
       Bankruptcy Code;

   (f) assert claims and causes of action on behalf of the
       Committee and the Debtors, if the Debtors fail to assert
       those claims; and

   (g) perform other services that are in the interest of the
       Debtors' creditors.

Kurt F. Gwynne, Esq., a partner at Reed Smith, discloses that the
Firm's current hourly rates have been discounted by 10%.  The
discounted hourly rates of the professionals who will work in the
engagement are:

      Professional                     Designation   Hourly Rate
      ------------                     -----------   -----------
      Kurt F. Gwynne, Esq.             Partner          $450
      Claudia Z. Springer, Esq.        Partner          $450
      Thomas J. Francella, Jr., Esq.   Associate        $252
      Mark W. Eckard, Esq.             Associate        $211
      John B. Lord                     Paralegal        $175
      Lynn Williams                    Paralegal        $148.50

To the best of the Debtors' knowledge, Reed Smith LLP and the
partners and professionals who will work in the engagement:

   (a) do not have connections with the Debtors, their creditors,
       or other party-in-interest, or their attorneys,

   (b) are "disinterested persons" as defined in Section 101(14)
       of the U.S. Bankruptcy Code, as modified by Section 1107(b)
       of the U.S. Bankruptcy Code, and

   (c) do not hold or represent any interest adverse to the
       Debtors' estates.

Headquartered in Wilmington, North Carolina, aaiPharma Inc. --   
http://aaipharma.com/-- provides product development services to         
the pharmaceutical industry and sells pharmaceutical products  
which primarily target pain management.  AAI operates two  
divisions:  AAI Development Services and Pharmaceuticals Division.  
The Company and eight of its debtor-affiliates filed for chapter  
11 protection on May 10, 2005 (Bankr. Del. Case Nos. 05-11341 to  
05-11350).  Karen McKinley, Esq. and Mark D. Collins, Esq. at  
Richards, Layton & Finger, P.A.; Jenn Hanson, Esq., and Gary L.  
Kaplan, Esq., at Fried, Frank, Harris, Shriver & Jacobson LLP; and  
the firm of Robinson, Bradshaw & Hinson, P.A., represent the  
Debtors in their restructuring efforts.  When the Debtors filed  
for bankruptcy, the reported consolidated assets amounting to  
$323,323,000 and consolidated debts totaling $446,693,000.


AAIPHARMA INC: Panel Gets Court Nod to Hire J.H. Cohn as Advisor
----------------------------------------------------------------
The Honorable Peter J. Walsh of the U.S. Bankruptcy Court for the
District of Delaware gave permission to the Official Committee of
Unsecured Creditors appointed in aaiPharma Inc. and its debtor-
affiliates' chapter 11 cases to hire J.H. Cohn LLP as its
accountant and financial advisor, nunc pro tunc to May 26, 2005.

The Committee selected J.H. Cohn because of the Firm's experience
in bankruptcy cases.  The Committee believes that the Firm will
effectively advise it in the Debtors' bankruptcy cases.

J.H. Cohn will:

   (a) evaluate the Debtors' proposed DIP facility and the impact
       of its terms on the various constituencies;

   (b) ascertain the viability of the Debtors' proposed
       reorganized and restructured business;

   (c) prepare a valuation of the Debtors' proposed remaining
       business units, and ascertain the reasonableness of the
       proposed capital structure;

   (d) determine the Debtors' short-term cash flow requirements
       and reasonableness of the proposed cash flow budget through
       the date of the proposed asset sale;

   (e) gain an understanding of the corporate and management
       structure of the Debtors;

   (f) identify related parties, including those entities that
       have not filed for chapter 11 protection, and the propriety
       of their business dealings with the Debtors;

   (g) ascertain the value of collateral underlying secured
       creditor claims and impact of the secured creditor lending
       arrangements on the Debtors;

   (h) evaluate the financial impact and net proceeds of the
       proposed asset sale on the Debtors' estate, including
       evaluation of the nature and extent of liability and
       contract assumption by the buyer;

   (i) investigate avoidance actions;

   (j) monitor Debtors' operating results and budget and
       communicate findings to the Committee as warranted;

   (k) assist the Committee in negotiating a plan of
       reorganization; and

   (l) render other bankruptcy and consulting services, attend
       hearings and meetings, and render other assistance as the
       Committee and its counsel may deem necessary.

Bernard A. Katz, CPA, a member of J.H. Cohn LLP, discloses that
the Firm gave the Committee a 20% discount on its rates.  The
current hourly rates of the professionals who will work in the
engagement are:

      Designation                     Hourly Rate
      -----------                     -----------
      Senior Partner                      $550
      Partner                             $475
      Director                            $420
      Senior Manager                      $400
      Manager                             $370
      Supervisor                          $330
      Senior Accountant                   $275
      Staff                               $220
      Paraprofessional                    $150

The Committee believes that J.H. Cohn LLP is disinterested as that
term is defined in Section 101(14) of the U.S. Bankruptcy Code.

Headquartered in Wilmington, North Carolina, aaiPharma Inc. --   
http://aaipharma.com/-- provides product development services to         
the pharmaceutical industry and sells pharmaceutical products  
which primarily target pain management.  AAI operates two  
divisions:  AAI Development Services and Pharmaceuticals Division.  
The Company and eight of its debtor-affiliates filed for chapter  
11 protection on May 10, 2005 (Bankr. Del. Case Nos. 05-11341 to  
05-11350).  Karen McKinley, Esq. and Mark D. Collins, Esq. at  
Richards, Layton & Finger, P.A.; Jenn Hanson, Esq., and Gary L.  
Kaplan, Esq., at Fried, Frank, Harris, Shriver & Jacobson LLP; and  
the firm of Robinson, Bradshaw & Hinson, P.A., represent the  
Debtors in their restructuring efforts.  When the Debtors filed  
for bankruptcy, the reported consolidated assets amounting to  
$323,323,000 and consolidated debts totaling $446,693,000.


AAIPHARMA INC: Wants Until Nov. 8 to Decide on Unexpired Leases
---------------------------------------------------------------
aaiPharma Inc. and its debtor-affiliates ask the U.S. Bankruptcy
Court for the District of Delaware to extend, until November 8,
2005, the time within which they can elect to assume, assume and
assign, or reject their unexpired nonresidential real property
leases.

The Debtors are in the process of assessing their business
operations.  In addition, the Debtors' management has been focused
on putting together a business plan to present to its creditor
constituencies for the Debtors' restructured business.

For that reason, their request for an extension will give them
sufficient time to decide which leases should be assumed or
rejected.  The Debtors also want to determine whether there is
value for the estate by assuming or assigning certain leases
rather than rejecting them.

Headquartered in Wilmington, North Carolina, aaiPharma Inc. --   
http://aaipharma.com/-- provides product development services to         
the pharmaceutical industry and sells pharmaceutical products  
which primarily target pain management.  AAI operates two  
divisions:  AAI Development Services and Pharmaceuticals Division.  
The Company and eight of its debtor-affiliates filed for chapter  
11 protection on May 10, 2005 (Bankr. Del. Case Nos. 05-11341 to  
05-11350).  Karen McKinley, Esq. and Mark D. Collins, Esq. at  
Richards, Layton & Finger, P.A.; Jenn Hanson, Esq., and Gary L.  
Kaplan, Esq., at Fried, Frank, Harris, Shriver & Jacobson LLP; and  
the firm of Robinson, Bradshaw & Hinson, P.A., represent the  
Debtors in their restructuring efforts.  When the Debtors filed  
for bankruptcy, the reported consolidated assets amounting to  
$323,323,000 and consolidated debts totaling $446,693,000.


ACANDS INC: Exclusive Plan Filing Period Intact Until Oct. 18
-------------------------------------------------------------
The U.S. Bankruptcy Court for the District of Delaware extended
ACandS, Inc.'s exclusive plan filing period through and including
the earlier of the effective date of its chapter 11 plan or
Oct. 18, 2005.  The Court also gave the Debtor exclusive right to
solicit acceptances of that plan from its creditors, through the
earlier of the effective date of that plan or Dec. 22, 2005.

As previously reported, the Bankruptcy Court approved the adequacy
of the Debtor's Amended Disclosure Statement explaining their
proposed Plan of Reorganization on Oct. 3, 2003.  On Jan. 26,
2004, the Bankruptcy Court entered its Proposed Findings of Fact
and Conclusions of Law Re Chapter 11 Plan Confirmation (Docket No.
979), recommending denial of confirmation of the Debtor's Plan.  

The Debtor reminded the Bankruptcy Court that its Proposed
Findings do not constitute an order of the Bankruptcy Court, but
are proposed findings subject to de novo review by the U.S.
District Court for the District of Delaware pursuant to Rule 9033
of the Federal Rules of Bankruptcy Procedure.  

On Feb. 5, 2004, the Debtor and the Official Committee of Asbestos
Personal Injury Claimants jointly filed with the District Court an
objection to the Bankruptcy Court's Proposed Findings.  In that
filing, the Debtor and the Committee asked the District Court to
reject the Bankruptcy Court's Findings and Conclusions and confirm
the proposed chapter 11 plan.  

On Feb. 3, 2004, the Debtor also delivered a notice to the
Bankruptcy Court indicating its intention to ask the District
Court to find that the Bankruptcy Court's rulings were wrong and
that the plan should be confirmed.  The appeal is a precautionary
measure given the Rule 9033 objection procedure being used by the
Debtor.  

The Debtor gave the Bankruptcy Court three reasons supporting an
extension of the Exclusive Periods:

   a) it is still in active negotiations with the Asbestos
      Claimants Committee and the Futures Representative for
      Asbestos Claimants in reaching a consensus on the terms of
      an amended Plan;

   b) the Debtor intends to ask the District Court to defer a
      hearing scheduled on July 13, 2005, to consider the appeal
      and the Debtor and the Asbestos Claimants Committee's joint
      objection; and

   c) the requested extension will not prejudice the Debtor's
      creditors and other parties-in-interest because it is not
      seeking the extension to delay administration of its case
      or pressure the creditors into accepting unsatisfactory
      plan.

Headquartered in Lancaster, Pennsylvania, ACandS, Inc., was an
insulation contracting company, primarily engaged in the
installation of thermal and mechanical insulation.  In later
years, the Debtor also performed a significant amount of
asbestos abatement and other environmental remediation work.  The
Company filed for chapter 11 protection on September 16, 2002,
(Bankr. Del. Case No. 02-12687).  Laura Davis Jones, Esq., at
Pachulski Stang Ziehl Young Jones & Weintraub, P.C., represents
the Debtor in its restructuring efforts.  When the Company filed
for protection from its creditors, it listed estimated debts and
assets of over $100 million.


ACANDS: Secures Open-Ended Deadline to File Notices of Removal
--------------------------------------------------------------
The Honorable Judith K. Fitzgerald of the U.S. Bankruptcy Court
for the District of Delaware extended ACandS, Inc.'s period to
file notices of removal with respect to prepetition civil actions,
pursuant to Rule 9027 of the Federal Rules of Bankruptcy.  Judge
Fitzgerald extended the Debtor's removal period to the earlier of
Nov. 4, 2005, or the effective date of a chapter 11 plan.

As previously reported, the Debtor gave the Bankruptcy Court four
reasons to extend the Removal Period:

   a) the Debtor and its professionals have spent the majority of
      their time and effort focusing on various litigation
      matters and compiling the massive amount of information
      necessary to complete the Schedules and Statements dealing
      with approximately 300,000 asbestos claims;

   b) the Debtor is still in the process of cooperating and
      negotiating with the Official Committee of Asbestos
      Personal Injury Claimants and the Futures Representative
      for Asbestos Claimants over the terms of an amended and
      consensual chapter 11 Plan; and

   c) the requested extension will give the Debtor and its
      professionals more opportunity to make fully-informed
      decisions concerning the removal of each pre-petition Civil
      Action and will assure that the Debtor does not forfeit
      valuable rights under 28 U.S.C. Sec. 1452; and

   d) the requested extension will not prejudice the Debtor's
      adversaries in any pre-petition Civil Action as any party
      to a Civil Action that is removed may have to seek it
      remanded to the appropriate State Court pursuant to 28
      U.S.C. Section 1452(b).

Headquartered in Lancaster, Pennsylvania, ACandS, Inc., was an
insulation contracting company, primarily engaged in the
installation of thermal and mechanical insulation.  In later
years, the Debtor also performed a significant amount of
asbestos abatement and other environmental remediation work.  The
Company filed for chapter 11 protection on September 16, 2002,
(Bankr. Del. Case No. 02-12687).  Laura Davis Jones, Esq., at
Pachulski Stang Ziehl Young Jones & Weintraub, P.C., represents
the Debtor in its restructuring efforts.  When the Company filed
for protection from its creditors, it listed estimated debts and
assets of over $100 million.


ACCERIS COMMS: Equity Deficit Widens to $77.4 Million at June 30
----------------------------------------------------------------
C2 Global Technologies Inc., f/k/a/ Acceris Communications Inc.
(OTCBB:ACRS), reported its financial results for the second
quarter ended June 30, 2005.

The Company's total operating revenue from continuing operations
for the second quarter ended June 30, 2005 was $21.2 million, a
decrease of 20 percent from $26.5 million in the second quarter of
2004.  For the three months ended June 30, 2005, the Company had a
loss from continuing operations of $8.1 million compared to a loss
from continuing operations of $8.2 million for the second quarter
of 2004.  The Company's net loss was $8.1 million in the second
quarter of 2005 compared to a loss of $8.2 million in the second
quarter of 2004.  The net loss per common share was $0.42 in the
second quarter of 2005 versus a net loss per common share of $0.43
in the second quarter of 2004.

For the six months ended June 30, 2005, the Company's total
operating revenue was $43.5 million compared to $61.7 million in
the first six months of 2004.  The Company had a loss from
continuing operations of $16.2 million compared to a loss from
continuing operations of $9.5 million for the six months ended
June 30, 2004.  The Company recorded a net loss of $16.2 million
for the six months ended June 30, 2005 versus a net loss of
$9.4 million for the six months ended June 30, 2004.  The net loss
per common share was $0.84 for the six-month period in 2005 versus
a net loss per common share of $0.49 in the first six months of
2004.

On May 19, 2005, the Company entered into an agreement to sell
substantially all of the assets and to transfer certain
liabilities of its telecommunications business to Acceris
Management and Acquisition LLC, an arm's length Minnesota limited
liability company and wholly owned subsidiary of North Central
Equity LLC.  The transaction is expected to close in September
2005.  Following the anticipated sale of its telecommunications
assets, C2's technologies segment will constitute its primary
business.  The new name reflects this strategic change in the
direction of the Company.

"The sale of our telecommunications business will allow C2 to
focus on the growing Voice over Internet Protocol market" said
Allan Silber, CEO of C2 Global Technologies Inc.

C2 Global Technologies -- http://www.c-2technologies.com/--  
is a broad based communications company serving residential,
small- and medium-sized business and large enterprise customers in
the United States. A facilities-based carrier, it provides a range
of products including local dial tone and 1+ domestic and
international long distance voice services, as well as fully
managed and fully integrated data and enhanced services. C2 offers
its communications products and services both directly and through
a network of independent agents, primarily via multi-level
marketing and commercial agent programs. C2 also offers a proven
network convergence solution for voice and data in Voice over
Internet Protocol communications technology and holds two
foundational patents in the VoIP space.  

As of June 30, 2005, C2 Global's stockholders' deficit widen to
$77,442,000 compared to a $61,965,000 deficit at Dec. 31, 2005.


ACTUANT CORP: Declares $0.08 Annual Dividend per Common Share
-------------------------------------------------------------
Actuant Corporation's (NYSE: ATU) Board of Directors has approved
the initiation of a cash dividend on the Company's common stock.
The Board declared an annual dividend of $0.08 per common share
payable on October 14, 2005 to shareholders of record at the close
of business on September 30, 2005.

"The decision to initiate a cash dividend reflects our track
record of generating consistent cash flow and our confidence in
Actuant's future," commented Robert C. Arzbaecher, President and
CEO of Actuant.  "Actuant has had a remarkable first five years
since its spin-off in July, 2000.  We substantially improved our
balance sheet and market capitalization, have significantly grown
sales and profits, and positioned the Company for an exciting
future.  The initiation of a dividend is a reflection of our
success, and allows us to provide a modest cash return to our
shareholders without compromising our ability to aggressively
pursue additional growth opportunities."

Headquartered in Glendale, Wisconsin, Actuant Corporation --
http://www.actuant.com/-- is a diversified industrial company  
with operations in over 30 countries.  The Actuant businesses are
market leaders in highly engineered position and motion control
systems and branded hydraulic and electrical tools and supplies.
Formerly known as Applied Power Inc., Actuant was created in 2000
after the spin-off of Applied Power's electronics business segment
into a separate public company called APW Ltd.  Since 2000,
Actuant has grown its sales run rate from $482 million to over
$1 billion and its market capitalization from $113 million to over
$1.4 billion.  The company employs a workforce of more than 5,000
worldwide.  Actuant Corporation trades on the NYSE under the
symbol ATU.

                         *     *     *

As reported in the Troubled Company Reporter on Aug. 2, 2005,
Standard & Poor's Ratings Services assigned its preliminary 'B+'
subordinated debt rating to Actuant Corp.'s $900 million universal
415 shelf registration.  At the same time, Standard & Poor's
affirmed its 'BB' corporate credit rating on the Milwaukee,
Wisconsin-based company.  S&P says the outlook is stable.


ADVANCED FIBER: Negotiating with Lenders on EBITDA Default Waiver
----------------------------------------------------------------
Advanced Fiber Technologies Income Fund (TSX:AFT.UN) was not able
to meet the EBITDA levels required under its Credit Facility's
covenants.

At the end of the second quarter on July 1, 2005, the Fund had
cash on hand of $0.1 million, and a revolving line of credit of
$10.0 million, which was partially drawn at the end of the
quarter.  There were no significant changes to either the Credit
Facility or the long-term obligations in place at the end of 2004.
Both the credit agreement and the Secured Notes indenture include
financial covenants that, once breached, prohibit the Fund from
making monthly distributions.  All these covenants were calculated
on the Advanced Fiber Technologies Trust consolidated financial
statements.  The debt to EBITDA ratio stood at 3.39 versus a
maximum covenant of 3.0, the current ratio stood at 2.02, before
the reclassification to short term of the Senior Secured Notes,
versus a minimum covenant of 1.50 and the interest coverage ratio
stood at 3.96 versus a minimum covenant of 4.50.  The trailing
twelve months minimum EBITDA covenant of $16.0 million was also
not met at quarter end.

The Fund has arranged to hold discussions with its short term and
long term lenders with a view to amending the Credit Facility and
Senior Secured Notes to deal with the current situation.

Under the Credit Facility, the non-compliance with the financial
covenants constitutes an Event of Default and the Fund cannot
declare any distribution until the Event of Default is cured.  In
addition, the short-term lender has the right to accelerate
repayment of any outstanding loans.

Under the Senior Secured Notes, the non-compliance with the
financial covenants constitutes a default that, if not cured
within 30 days from a formal notice by the Noteholders, becomes an
Event of Default.  The Fund cannot declare any distributions until
the default is cured.  In addition, upon an Event of Default,
Noteholders are entitled to the immediate payment of any
outstanding capital and accrued interest on the Senior Secured
Notes and, if not paid, to the realization of their securities.

Although the outcome of the discussions are not known, they may
result in more stringent credit conditions and higher interest
rates.


ALION SCIENCE: S&P Revises Outlook to Negative from Stable
----------------------------------------------------------
Standard & Poor's Ratings Services revised its outlook on McLean,
Virginia-based Alion Science and Technology Corp. to negative from
stable.  At the same time, Standard & Poor's affirmed its 'B+'
corporate credit rating and 'B+' rating on the company's
approximately $170 million senior secured bank facility.
      
"The outlook revision reflects the recently lost recompete of the
Joint Spectrum Center Engineering Support Services contract," said
Standard & Poor's credit analyst Ben Bubeck.  This was Alion's
largest contract in fiscal 2004, ended September, contributing
nearly $50 million, or approximately 10%, to pro forma total
revenues following the acquisition of John J. McMullen Associates,
Inc. in April 2005.  The loss of the Joint Spectrum Centers
relationship, which dates back to 1961, will negatively affect
operations, at least until this lost business is replaced.
     
The ratings reflect Alion's relatively modest position in the
highly competitive and consolidating government IT services
market, an acquisitive growth strategy, and high debt leverage.  
A predictable revenue stream based upon a strong backlog and the
expectation that the government IT services sector will continue
to grow over the intermediate term are partial offsets to these
factors.
     
Alion is an R&D, engineering, and information technology company
that provides services and communications solutions primarily to
the federal government.  Pro forma for a recently closed
incremental term loan facility, Alion had approximately $270
million in operating lease-adjusted total debt as of March 2005.


ALLIED HOLDINGS: Court Allows Payment of Insurance Premiums   
-----------------------------------------------------------
The U.S. Bankruptcy Court for the Northern District of Georgia
granted Allied Holdings, Inc., and its debtor-affiliates' request
for authority to continue making payments pursuant to their
prepetition premium financing arrangements and to continue to
grant the lenders a security interest in the unearned insurance
premiums, the return premiums and any loss payments.

The Debtors have executed premium financing arrangements
agreements with Flatiron Capital Corp., in the United States and
Marsh Canada Limited in Canada.  Flatiron and Marsh agreed to
fund certain of the Debtors' premium payments for various
insurance polices, including employment liability insurance,
property insurance, professional liability insurance, directors
and officers liability insurance, excess liability insurance and
other policies.

The Marsh and Flatiron premium financing arrangements require the
Debtors to make regular payments on the loans.  The Debtors owe
$3,400,000 to Flatiron for 2005 premium financing and $860,000 to
Marsh for 2005 premium financing.  

Jeffrey W. Kelley, Esq., at Troutman Sanders, LLP, in Atlanta,
Georgia, states that if the Debtors default on the payments,
Flatiron and Marsh may seek relief from the automatic stay in
attempt to cancel the Policies and seize the Collateral.

The Debtors also seek authority to execute postpetition insurance
premium financing agreements.

"Although the Debtors do not presently have knowledge that such
relief will be necessary, the Debtors act out of an abundance of
caution in seeking such relief in the event such a situation
should arise whereby the Debtors' existing PFAs are terminated or
if new insurance policies, for example, are required," Mr. Kelley
notes.

Headquartered in Decatur, Georgia, Allied Holdings, Inc. --  
http://www.alliedholdings.com/-- and its affiliates provide   
short-haul services for original equipment manufacturers and  
provide logistical services.  The Company and 22 of its affiliates  
filed for chapter 11 protection on July 31, 2005 (Bankr. N.D. Ga.  
Case No. 05-12515).  Jeffrey W. Kelley, Esq., at Troutman Sanders,
LLP, represents the Debtors in their restructuring efforts.  When
the Debtors filed for protection from their creditors, they
estimated more than $100 million in assets and debts.  (Allied
Holdings Bankruptcy News, Issue No. 3; Bankruptcy Creditors'
Service, Inc., 215/945-7000)


AMERICA WEST: Shareholders Will Vote on US Air Merger on Sept. 13
-----------------------------------------------------------------
According to a regulatory filing with the Securities and Exchange
Commission, shareholders of America West Holdings Corp. will
convene a meeting on September 13, 2005, to cast their votes on
the proposed US Airways-America West merger.  

The two airline companies confirmed a merger pact which will
create the first full-service nationwide airline, with the
consumer-friendly pricing structure of a low-fare carrier.  
America West stockholders will receive shares in the new US
Airways Group for their America West stock. The exchange rate will
be 0.4125 shares of the new company for each share of America West
stock.

Subject to approval by the U.S. Bankruptcy Court overseeing US
Airways' pending Chapter 11 case and transaction closing, which is
anticipated to occur this fall, the merged airlines will operate
under the US Airways brand under the leadership of CEO Doug
Parker.  The Associated Press relates that Mr. Parker will receive
an array of stock benefits as a result of the merger.  In
exchange, he agreed to waive a "change of control" clause in his
contract that would have provided a big severance payout if he
voluntarily left within two years of the merger.

The merger is expected to occur subsequent to confirmation of US
Airways' plan of reorganization and emergence from Chapter 11.

                        *    *    *

As previously reported in the Troubled Company Reporter, on May
23, 2005, Standard & Poor's Ratings Services ratings on America
West Holdings Corp. and subsidiary America West Airlines Inc.,
including the 'B-' corporate credit ratings on both entities,
remain on CreditWatch with negative implications, where they were
placed on April 21, 2005.  The CreditWatch update follows the
announcement that America West has agreed to acquire US Airways
Group Inc., parent of US Airways Inc., both currently operating
under Chapter 11 bankruptcy protection and rated 'D.'

Standard & Poor's will resolve the CreditWatch through an
assessment of the combined companies' business and financial risk
profiles.  This assessment will focus on labor integration, cost
and revenue synergies, and the company's its balance sheet and
access to liquidity.  Ratings could be affirmed if Standard &
Poor's concludes that the combined entity's improved liquidity and
expected synergies more than offset intermediate-term labor
integration risks.  Alternatively, ratings could be lowered
modestly if America West is unable to reduce US Airways' losses,
which would result in reduced liquidity.

Headquartered in Arlington, Virginia, US Airways' primary business
activity is the ownership of the common stock of:

            * US Airways, Inc.,
            * Allegheny Airlines, Inc.,
            * Piedmont Airlines, Inc.,
            * PSA Airlines, Inc.,
            * MidAtlantic Airways, Inc.,
            * US Airways Leasing and Sales, Inc.,
            * Material Services Company, Inc., and
            * Airways Assurance Limited, LLC.

Under a chapter 11 plan declared effective on March 31, 2003,
USAir emerged from bankruptcy with the Retirement Systems of
Alabama taking a 40% equity stake in the deleveraged carrier in
exchange for $240 million infusion of new capital.

US Airways and its subsidiaries filed another chapter 11 petition
on September 12, 2004 (Bankr. E.D. Va. Case No. 04-13820).  Brian
P. Leitch, Esq., Daniel M. Lewis, Esq., and Michael J. Canning,
Esq., at Arnold & Porter LLP, and Lawrence E. Rifken, Esq., and
Douglas M. Foley, Esq., at McGuireWoods LLP, represent the Debtors
in their restructuring efforts.  In the Company's second
bankruptcy filing, it lists $8,805,972,000 in total assets and
$8,702,437,000 in total debts.

America West -- http://www.americawest.com/-- operates more than    
900 flights daily to 95 destinations in the U.S., Canada, Mexico
and Costa Rica.  The airline's 13,500 employees are proud to offer
a range of services including more destinations than any other
low-cost carrier, first-class cabins, assigned seating, airport
clubs and an award-winning frequent flyer program.


AMERICAN BUSINESS: Chapter 7 Trustee Wants to Continue Operations
-----------------------------------------------------------------
George L. Miller, the Chapter 7 Trustee overseeing the
liquidation of American Business Financial Services and its
debtor-affiliates' estates, wants to continue certain limited
operations of the Debtors through September 2, 2005, to effect an
orderly and expeditious shutdown of the Debtors' businesses and
administration of their estates for the creditors' benefit.

At this time, the Trustee anticipates employing eight former
employees during the Extended Period to engage in these Limited
Operations:

Department      Employees        Purpose
----------      ---------        -------
Securitization  Anna Bucceroni,  To assist:
                Eric Boynton &    
                Steve Hagan      * in evaluating the performance
                                   of the individual
                                   securitizations;

                                 * in focusing third-party
                                   mortgage servicing companies
                                   on continued collection
                                   efforts and liquidating REO;

                                 * to ensure proper calculation
                                   and collection of pre-
                                   payment penalty fees; and

                                 * professionals employed by
                                   secured creditors and the
                                   Trustee in obtaining data to
                                   assist in valuation of
                                   securitizations and related
                                   I/O strips.

Servicing       Kathleen McGady &  To review incoming
                Leonora Celenesi   correspondence regarding the
                                   Debtors' properties to ensure
                                   proper handling, i.e. tax
                                   sale notices, and assist the
                                   Trustee regarding ongoing
                                   inquiries of mortgage
                                   payoffs, satisfactions, and
                                   in identifying charged-off
                                   properties available for
                                   sale.

IT              David Kelble       To assist in the creation of
                                   a separate computer system to
                                   enable the Trustee to shut
                                   down non-essential computer
                                   systems which can be made
                                   available for sale,
                                   abandonment, or other transfer
                                   to governmental agencies.

Facilities      George Illicher    To assist in relocation of
                                   remaining assets located in
                                   leased premises after
                                   operations cease, and in
                                   document destruction and
                                   consolidation of warehouse
                                   space, including records
                                   required to be retained by
                                   operation of law.

Corporate       Ira Brownstein     To facilitate whole loan and
                                   securitization sales, or,
                                   abandonment.

The Trustee believes that the cost of continuing the Debtors'
operations for the Extended Period is de minimis relative to the
benefit to the estates by enabling the Trustee to proceed with an
orderly administration and liquidation.

The Trustee further contends that a cessation of operations may
result in serious and irreparable harm to the Debtors' estates by
negatively impacting on the value to be realized from the
Debtors' assets.  In addition, the integrity of the Debtors'
computer and other records, which are needed for completion of
any investigation of the Debtors' financial affairs by the
Trustee and other government agencies, may also be jeopardized.

Headquartered in Philadelphia, Pennsylvania, American Business
Financial Services, Inc., together with its subsidiaries, is a
financial services organization operating mainly in the eastern
and central portions of the United States and California.  The
Company originates, sells and services home mortgage loans through
its principal direct and indirect subsidiaries.  The Company,
along with four of its subsidiaries, filed for chapter 11
protection on Jan. 21, 2005 (Bankr. D. Del. Case No. 05-10203).  
Bonnie Glantz Fatell, Esq., at Blank Rome LLP represents the
Debtors in their restructuring efforts.  When the Company filed
for protection from its creditors, it listed $1,083,396,000 in
total assets and $1,071,537,000 in total debts.  (American
Business Bankruptcy News, Issue No. 19; Bankruptcy Creditors'
Service, Inc., 215/945-7000)


AMERICAN BUSINESS: Trustee Wants More Time to Decide on Pa. Lease
-----------------------------------------------------------------
On October 27, 1997, American Business Financial Services, Inc.,
executed a non-residential real property lease with Philadelphia
Design and Distribution Center, L.P., and Equivest Development,
Inc., pursuant to which ABFS leases around 36,000 square feet
located within the building commonly known as the "Wissahickon
Industrial Center," in Philadelphia, Pennsylvania.

The Philadelphia Lease expires October 31, 2014.

George L. Miller, the Chapter 7 Trustee overseeing the
liquidation of the Debtors' estates, informs the Court that ABFS
currently uses the Wissahickon Premises as warehouse space to
store business records, including, without limitation, certain
mortgage loan documents which the Trustee is required to preserve
for a certain period of time under applicable state law.

As of July 15, 2005, the Trustee has made all of the payments due
under the Philadelphia Lease as and when they have become due.

Pursuant to Section 365(d)(4) of the Bankruptcy Code, the
deadline for the Debtors to assume or reject the Philadelphia
Lease was initially set to expire on March 21, 2005, and which
was further extended to June 19, 2005.

Section 348(c) provides that Section 365(d)(4) applies as if the
May 17, 2005 order converting the Debtors' Chapter 11 cases to
one under Chapter 7 was the order for relief.  Accordingly, as a
result of the conversion of the Debtors' cases, the new deadline
by which the Trustee must decide on the Philadelphia Lease is
July 17, 2005.

By this motion, the Trustee asks the Court to further extend the
time to assume or reject the Philadelphia Lease through and
including September 30, 2005.

The Trustee asserts that he still needs the office space for at
least some remaining portion of the liquidation process to enable
the orderly wind-down of the Debtors' businesses and to otherwise
liquidate and safeguard the estates' property.

Unless the Lease Decision period is extended, the Trustee may be
compelled to (i) unnecessarily assume long-term liabilities
creating a substantial administrative expense claim, or (ii) run
the risk that the Philadelphia Lease is rejected prematurely,
depriving the Debtors' estates of a potentially valuable asset.

The Trustee believes that an extension is necessary for him to
make an informed decision to assume or reject the Philadelphia
Lease.

Since Section 365(d)(3) requires timely performance of the
Trustee of all of its obligations, the Trustee assures the Court
that the requested extension will not cause prejudice to
Philadelphia Design.

Judge Walrath will convene a hearing on August 12, 2005, to
consider the Debtors' request.  By application of Del.Bankr.LR
9006-2, the Debtors' Lease Decision Deadline is automatically
extended until the Court rules on the request.

Headquartered in Philadelphia, Pennsylvania, American Business
Financial Services, Inc., together with its subsidiaries, is a
financial services organization operating mainly in the eastern
and central portions of the United States and California.  The
Company originates, sells and services home mortgage loans through
its principal direct and indirect subsidiaries.  The Company,
along with four of its subsidiaries, filed for chapter 11
protection on Jan. 21, 2005 (Bankr. D. Del. Case No. 05-10203).  
Bonnie Glantz Fatell, Esq., at Blank Rome LLP represents the
Debtors in their restructuring efforts.  When the Company filed
for protection from its creditors, it listed $1,083,396,000 in
total assets and $1,071,537,000 in total debts.  (American
Business Bankruptcy News, Issue No. 19; Bankruptcy Creditors'
Service, Inc., 215/945-7000)


AMERICAN ITALIAN: Internal Audit Review Delays Quarterly Reporting
------------------------------------------------------------------
American Italian Pasta Company (NYSE: PLB) is delaying the release
of its full financial results for the third fiscal quarter ended
July 1, 2005, and is also delaying the filing of its third quarter
Form 10-Q with the Securities and Exchange Commission.  The
Company stated that its Audit Committee is conducting an internal
investigation of certain accounting procedures and practices and
certain other matters.  The Company also outlined impairment
charges and other financial statement adjustments that will be
recorded and provided an overview of its business results for the
third quarter.

The Company's third quarter Form 10-Q, due on Aug. 10, 2005, and
the Company's previously planned Aug. 10, 2005, earnings release
are being delayed until the Audit Committee has completed its
review of the matters that are the subject of its internal
investigation.  The Company will file its Form 10-Q as soon as is
practicable but does not currently expect that it will be able to
file within the five-day extension period provided for under SEC
Rule 12b-25.  The conference call originally scheduled for
Aug. 10, 2005, has been cancelled.

While the Company's core operations were profitable in the third
quarter, such operations did not meet internal expectations and
were not consistent with the third quarter results contemplated in
the full- year earnings guidance outlined earlier by the Company.
Combined with the charges outlined below, the Company expects to
record a significant net loss for the third quarter ended July 1,
2005, leading to a net loss for the 2005 fiscal year.

While the Company expects to operate profitably in the fourth
quarter and generate positive free cash flow (operating cash flow
less capital expenditures), it will not achieve in fiscal year
2005 the expected range of margin performance, overall
profitability and free cash flow as set forth in the Company's
earnings release on April 27, 2005.

      Audit Committee Internal Investigation

The Company's Audit Committee has recently commenced an internal
investigation, undertaken at the Committee's own initiative, of
certain matters including:

    * certain accounting procedures and practices including those
      relating to material weaknesses in internal controls
      identified by the Company;

    * financial statement adjustments and the circumstances
      surrounding such adjustments; and

    * certain transactions and possible past accounting errors and
      their causes.

The Audit Committee has retained outside counsel to assist with
its investigation and outside counsel has engaged forensic
accountants.  The Company's external auditors, Ernst & Young LLP,
have been notified of the internal investigation.  The Company
indicated that the investigation relates to transactions and other
matters occurring as early as the Company's 2000 fiscal year.

The internal investigation has not yet been completed and the
Company indicated that financial statement adjustments might be
necessary in addition to those outlined in this release.  Until
the internal investigation is completed by the Audit Committee and
any financial statement adjustments and their causes are
determined, the Company's third quarter results and any impact on
prior period results cannot be finalized.

                      SEC Discussions

The Company also stated that in late 2004 and early 2005, it
received inquiries from the Philadelphia and New York Stock
Exchanges concerning trading activity in the Company's stock, by
persons outside of the Company, during time periods surrounding
certain of the Company's public announcements.  As is the routine
practice of the exchanges, the staff of the SEC was advised of the
inquiries.  In March 2005, the Company initiated contact with the
SEC staff and began discussions with the staff regarding
information relating to the exchange inquiries.  The Company has
had ongoing discussions with and has voluntarily been providing
relevant information to the SEC staff.  These discussions and
disclosures are in keeping with the Company's policy to assist and
cooperate with inquiries by an exchange or government regulatory
authority.  Some of the issues under discussion with the SEC staff
relate to certain of the subjects addressed below.  The SEC
staff's review is ongoing and the Company is continuing to
cooperate with the staff's efforts.

                Financial Statement Adjustments

The Company intends to record adjustments totaling $60.7 million
in its financial statements that are primarily non-cash charges
(all but $3.7 million are non-cash items).  The adjustments are
(in millions):

     Impairment charges                                 $36.7
     Low and reduced carb inventory write-downs           5.2
     Other financial statement adjustments               18.8
                                                        -----
     Total                                              $60.7

           Material Weaknesses in Internal Controls

As previously disclosed in the Company's second quarter report,
the Company identified certain material weaknesses in internal
controls in conjunction with its preparation to fulfill the
requirements of Section 404 of the Sarbanes-Oxley Act.  During the
third quarter the Company identified additional material
weaknesses in internal controls relating to certain fixed asset
accounting.  The Company has commenced the development and
implementation of procedures designed to remediate the identified
weaknesses.  The Company's Audit Committee will oversee the
remediation efforts.

             Other Financial Statement Adjustments

Related to the material weaknesses identified, as well as other
market and business conditions, it is expected that the financial
statements will be adjusted by recording charges aggregating
$18.8 million.  These financial statement adjustments are
comprised primarily of:

    * Promotional allowances and related customer deduction
      receivables - $6.6 million of additional expense will be
      recorded and is comprised of increases in accrued
      promotional liabilities of $3.7 million (resulting from
      updated estimates of prior periods promotional expenses
      incurred but not yet paid) and write-downs of $2.9 million
      related to customer receivables determined to be
      uncollectible.

    * Spare parts inventory - Write-downs totaling $5.4 million
      will be recorded related to physical inventory shortages,
      valuation adjustments and the adjustment of obsolescence
      reserves for spare parts to reflect the Company's
      anticipated recoverability on the disposition of certain
      excess or obsolete parts.

    * Inventory valuation - The Company's reserves for slow
      moving, damaged and discontinued inventories will be
      increased by $4.1 million (exclusive of the write-downs
      related to low and reduced carb inventories, as noted above)
      to reflect the anticipated recoverability of certain
      inventories in excess of identified requirements.  In
      addition, the carrying value of inventory will be reduced by
      $600,000, consisting of adjustments to the allocation of
      overhead expenses relating to production costs.

    * Dispositions of fixed assets - It was determined that
      certain fixed asset retirements occurring in prior periods
      were not recorded by the Company.

Accordingly, losses on dispositions of fixed assets totaling
$1.9 million will be recorded in the financial statements.

                  Continuing Financial Review

The Company and the Audit Committee are currently assessing the
extent to which the adjustments correct errors in prior reporting
periods or are changes in estimates.  In addition, the Company is
evaluating certain other financial statement adjustments,
aggregating up to approximately $4.2 million, that may be recorded
to correct errors in the prior reporting periods of fiscal years
2000 through 2004 and that were considered immaterial at the time.

The Audit Committee is also investigating certain transactions
unrelated to the adjustments otherwise discussed above that are
currently estimated to total less than $1 million.  Accordingly,
the impact these financial statement adjustments will have on the
third quarter results or on prior period financial statements, if
any, has not yet been determined.  The Company's and the Audit
Committee's reviews are ongoing and could result in additional or
revised adjustments.

Founded in 1988 and based in Kansas City, Missouri, American
Italian Pasta Company is the largest producer and marketer of dry
pasta in North America. The Company has five plants that are
located in Excelsior Springs, Missouri; Columbia, South Carolina;
Tolleson, Arizona; Kenosha, Wisconsin and Verolanuova, Italy. The
Company has approximately 600 employees located in the United
States and Italy.


AMERICAN ITALIAN: Talking to Bank Lenders to Amend Credit Pacts
---------------------------------------------------------------
American Italian Pasta Company (NYSE: PLB) says discussions with
its bank group continue regarding an amendment to certain
financial covenants and other terms for the third quarter and the
remaining term of the credit agreement, which expires on Oct. 2,
2006.  The Company received a waiver from the bank group on
July 19, 2005, for non-compliance with certain covenants contained
in its bank credit agreement for the third quarter of fiscal year
2005.  The waiver will expire on Sept. 16, 2005.

If the amendment is not completed by the end of the initial waiver
period, the Company will seek a waiver allowing for additional
time to complete an amendment to the bank credit agreement.

As part of the waiver agreement, the Company agreed to accelerate
by approximately 2-1/2 months the annual reduction in the
revolving credit facility set forth in the credit agreement.  The
$30 million reduction, originally scheduled for October 1, 2005,
results in a contraction of the Company's credit facility to $290
million (comprised of a $190 million revolving credit facility and
a $100 million term loan).  In addition, the Company has informed
its lenders that it does not intend to declare or pay dividends
during the waiver period.  The Company will evaluate its future
dividend policy in connection with future borrowing arrangements.

Until the Company's amendment process is completed and the
covenants are revised going-forward, generally accepted accounting
principles require that the Company reclassify its bank debt from
long-term to a short-term liability on its balance sheet.
Accordingly, if the July 1, 2005 balance sheet is issued before an
amendment to the credit facility is finalized, long-term debt
related to the credit facility of $276.8 million will be
classified as a current liability.

The Company believes that net cash flow expected to be generated
from operations, combined with available borrowings under its
credit facilities and current cash on hand will be sufficient to
fully meet its expected capital and liquidity needs for the
foreseeable future, assuming the Company obtains an amended credit
agreement not requiring significant principal reduction in the
coming year.  At the end of the third quarter, the Company had
cash balances of $13.7 million and $12.3 million was available
under its revolving credit facility (as adjusted by the waiver
agreement).

Founded in 1988 and based in Kansas City, Missouri, American
Italian Pasta Company is the largest producer and marketer of dry
pasta in North America. The Company has five plants that are
located in Excelsior Springs, Missouri; Columbia, South Carolina;
Tolleson, Arizona; Kenosha, Wisconsin and Verolanuova, Italy. The
Company has approximately 600 employees located in the United
States and Italy.


AMPEX CORPORATION: June 30 Balance Sheet Upside-Down By $89 Mil.
----------------------------------------------------------------
Ampex Corporation (Nasdaq:AMPX) reported net income of $2.5
million for the second quarter of 2005, after deduction of $3.7
million for the cost of patent litigation.  In the second quarter
of 2004, the Company reported a net loss of $4.2 million after
deduction of $1.8 million of patent litigation expense.  Total
revenues were $15.8 million in the second quarter of 2005 compared
with $8.9 million in the second quarter of the prior year.

Licensing revenue totaled $9.9 million in the second quarter of
2005, up from $1.4 million in the second quarter of 2004.  During
the second quarter of 2005, new patent licensing agreements were
announced with four additional manufacturers of digital still
cameras (Fuji Photo Film Ltd., Funai Electric Co., Ltd., Konica
Minolta Holdings, Inc. and Nikon Corporation).  In the second
quarter of 2005, $4.9 million of licensing revenue reflected
prepayments of royalty obligations through the first quarter of
2006 relating to digital still camera licenses.

The balance of $5.0 million represented royalties in respect of
past or current sales under licenses that provide for running
royalties based on the licensee's revenues from products,
including digital still cameras, digital camcorders and DVD
recorders.  In the second quarter of 2004, all of the Company's
licensing revenue came from running royalties paid by
manufacturers of digital video camcorders.

During the second quarter of 2005, the Company's intellectual
property costs included litigation costs of $3.7 million related
to lawsuits that it initiated in October 2004 against Eastman
Kodak Company alleging patent infringement.  Litigation expense in
the second quarter of 2004 totaled $1.8 million related to suits
brought against two other manufacturers of digital still cameras
which were settled in the fourth quarter of 2004 upon successfully
concluding licensing agreements.  The Company may seek to enforce
its digital imaging patents by instituting additional litigation
against manufacturers of digital still cameras, digital video
camcorders, DVD recorders, camera-equipped cellular phones or
other products if the Company believes its patents are being
infringed by such manufacturers and licensing agreements cannot be
concluded on satisfactory terms.  The Licensing segment
contributed operating profit of $5.6 million in the second quarter
of 2005 compared to an operating loss of $0.7 million in the
second quarter of 2004.

Product sales and service revenues from the Company's Recorders
segment totaled $5.9 million for the second quarter of 2005
compared to $7.5 million in the second quarter of 2004.  The sales
decline is primarily attributed to an ongoing transition from an
older generation of tape-based image and data acquisition products
to a newly introduced range of solid-state and hard disk-based
products.  Such sales declines, coupled with increased research
and development and selling and administrative costs for the
Recorders segment, which were partially offset by improved gross
profit margins, resulted in a drop in operating income in the
second quarter of 2005 to $25,000 compared to $800,000 in the
second quarter of 2004.

The Recorders segment has recently been awarded a contract from
The Boeing Company for new disk and solid state-based data
instrumentation recorders to be used in the development of the 787
airplane.  The recorders are scheduled to be delivered over the
next 30 months and have a total contract value of approximately
$6.3 million.  This contract has been included in reported backlog
as of June 30, 2005.

Headquartered in Redwood City, California, Ampex Corporation, --
http://www.ampex.com/-- is one of the world's leading innovators  
and licensors of technologies for the visual information age.

At Jun. 30, 2005, Ampex Corporation's balance sheet showed an
$89,414,000 stockholders' deficit, compared to a $99,429,000
deficit at Dec. 31, 2004.


ANCHOR GLASS: Nasdaq Will Halt Securities Trading on Aug. 17
------------------------------------------------------------
The Nasdaq Stock Market determined that Anchor Glass Container
Corporation's (NASDAQ:AGCC) securities will be delisted from The
Nasdaq Stock Market at the opening of business on Aug. 17, 2005,
unless the Company requests a hearing in accordance with the
Marketplace Rule 4800 Series.  The action came after the Company
filed a chapter 22 petition on Aug. 8, 2005.

As a result of the bankruptcy filing, the fifth character "Q" will
be appended to the Company's trading symbol.  Accordingly, the
trading symbol for Anchor's securities, common stock, $.10 par
value, is changed from AGCC to AGCCQ at the opening of business on
Aug. 10, 2005.

Headquartered in Tampa, Florida, Anchor Glass Container  
Corporation is the third-largest manufacturer of glass containers
in the United States.  Anchor manufactures a diverse line of flint  
(clear), amber, green and other colored glass containers for the
beer, beverage, food, liquor and flavored alcoholic beverage
markets.  The Company filed for chapter 11 protection on Aug. 8,  
2005 (Bankr. M.D. Fla. Case No. 05-15606).  Robert A. Soriano,  
Esq., at Carlton Fields PA, represents the Debtor in its
restructuring efforts.  When the Debtor filed for protection from
its creditors, it listed $661.5 million in assets and $666.6
million in debts.

The Company previously filed for chapter 11 protection on Apr. 15,
2002.  The U.S. Bankruptcy Court for the District of Delaware
confirmed the company's Amended Plan of Reorganization on Aug. 8,
2002, and the Company emerged from chapter 11 on August 30, 2002,
that delivered equity in the reorganized company to affiliates of
investment firm Cerberus Capital Management, L.P.  In September
2003, Anchor Glass completed an IPO.  Cerberus affiliates own a
60% stake in Anchor Glass.


ANCHOR GLASS: Moody's Junks $350 Million Senior Secured Notes
-------------------------------------------------------------
Moody's Investors Service concluded the review for downgrade of
ratings on Anchor Glass Container Corporation and downgraded the
corporate family rating and rating on the $350 million 11% senior
secured notes due 2013 one notch to Caa2 from Caa1.  The action
follows the company's announcement that it has filed a voluntary
petition for reorganization under Chapter 11 of the US Bankruptcy
Code.  All ratings consequently will be withdrawn in the very near
term.

In order that the company may continue to operate, lenders of the
existing $135 million senior secured revolving credit facility
(not rated by Moody's) have agreed to convert their loan facility
into a debtor-in-possession facility.  The Caa2 corporate family
rating takes into account that the company continues to operate
under bankruptcy protection, as well as uncertainty surrounding
recent announcements regarding accounting errors during 2001-2004.
The Caa2 rating on the senior secured notes reflects the first
priority claim that noteholders possess on substantially all
existing real property, equipment, and all other fixed assets
related to Anchor's eight manufacturing facilities.

The action applies to these ratings:

   -- $350 million senior secured notes due 2013, downgraded
      to Caa2

   -- Corporate family (formerly senior implied), downgraded
      to Caa2

Headquartered in Tampa, Florida, Anchor Glass Container
Corporation is a manufacturer of glass containers in the United
States, producing a diverse line of various types of clear and
colored glass containers for customers principally in the:

   * beer,
   * beverage,
   * food, and
   * liquor industries.

Net sales for fiscal year 2004 amounted to approximately
$747 million.


ANCHOR GLASS: S&P Lowers Corporate Credit & Sr. Sec. Ratings to D
-----------------------------------------------------------------
Standard & Poor's Ratings Services lowered its corporate credit
and senior secured ratings on Anchor Glass Container Corp. to 'D'
from 'CCC', following the company's recent announcement that it
has filed a petition for reorganization under Chapter 11 of the
U.S. Bankruptcy Code.  

The ratings were removed from CreditWatch with negative
implications, where they were placed on June 28, 2005, on
heightened concerns regarding the company's tight liquidity and
deterioration in Anchor's highly leveraged financial profile.
     
Anchor's very aggressive leverage of about 8x total adjusted debt
(including post-retirement benefit obligations and leases) to
EBITDA at April 28, 2005, and very strained liquidity followed a
deterioration in operating results in 2005.
     
"Operations were negatively affected by lower-than-expected sales
volume trends, elevated natural gas prices (the principal fuel for
manufacturing glass), and increased raw-material costs," said
Standard & Poor's credit analyst Paul Kurias.
     
Lower than expected beer volumes and the company's high dependence
on a few key customers also contributed to the decline (Anheuser-
Busch Inc. accounts for about 53% of sales).
     
With annual revenues of about $737 million, Anchor is the third-
largest U.S. producer of glass containers for beer, beverages, and
foods and has an estimated market share of 18%.  Although the
glass packaging industry is concentrated, competition is intense
from two larger, more efficient and global glass container
producers, Owens-Illinois Inc. and Compagnie de Saint-Gobain S.A.


ARCH COAL: Moody's Affirms $145 Mil. Preferred Stock Rating at B3
-----------------------------------------------------------------
Moody's Investors Service affirmed Arch Coal, Inc.'s Ba3 corporate
family rating.  All other ratings of Arch Coal Inc., and its
subsidiary, Arch Western Finance LLC, were affirmed.  AWF's notes
are guaranteed by its parent, Arch Western Resources, a subsidiary
of Arch Coal.  The affirmation follows Arch's announcement of its
intention to contribute four of its central Appalachian mining
operations to a new company, which will also have mining
operations (known as Trout Coal) contributed to it by ArcLight.  
The new company will file for an initial public offering and it is
expected that Arch Coal will initially own approximately 37.5% of
this company.  The rating outlook for both Arch Coal and AWF is
stable.

These ratings are affirmed:

Arch Coal, Inc.:

   * $700 million five-year guaranteed senior secured revolving
     credit facility, Ba2

   * $145 million of Perpetual Cumulative Convertible Preferred
     Stock, B3

   * Corporate Family rating, Ba3

Arch Western Finance, LLC:

   * $961 million of 6.75% guaranteed senior notes due 2013, Ba3

Moody's views the transfer of four of Arch Coal's Central
Appalachian mines, their associated annual production of
approximately 12 million tons and their 455 million tons of
associated reserves as neutral to the rating.  The positive
aspects of the transaction include the transfer to the new company
of OPEB and other employee related obligations.  The transaction
will also afford Arch Coal the opportunity to monetize these
assets.

However, Moody's is concerned about Arch Coal's continuing
operating and rail difficulties and their anticipated continuing
impact on this year's operating results.  Combined with
anticipated higher levels of expansionary capex, the company can
be expected to rely on its cash balances, as well as any proceeds
that may be realized this year from the monetization of the new
company, to fund anticipated negative free cash flow this year.

Arch Coal's Ba3 corporate family rating reflects:

   * its high leverage;

   * mine development and reserve acquisition costs;

   * increased operating costs and rail related difficulties;

   * significant dependence on one mine; and

   * substantial liabilities for reclamation and employee
     benefits, which totaled $858 million as of December 31, 2004.  

The rating also considers Arch Coal's relatively stable operating
profile, its size, diversified asset and customer base, favorable
operating costs in Arch's western operations, and a high
proportion of low-sulfur coal production and reserves.  Arch
Coal's LTM June 30, 2005 adjusted debt to EBITDA is 4.4x. Adjusted
debt includes debt, preferred shares, guarantees, unfunded pension
liabilities and operating leases.

AWF's Ba3 senior unsecured rating reflects the guarantee of AWR
and its high leverage, modest cash flow, ties to Arch Coal and
significant dependence on one mine, the combined Black
Thunder/North Rochelle mine.  Both Arch Coal and AWR are also
subject to geologic, operating, environmental, regulatory, and
permitting risks inherent to coal mining, which can impact
operating and financial performance.  AWF's rating also reflects
the overall good quality of AWR's mines and coal reserves, which
operate in three distinct western coal fields, its favorable
market position as a supplier of low sulfur and compliance coal to
numerous utility customers, and its competitive costs.  AWR is
relatively unburdened by workers' compensation and retiree
healthcare costs.

The stable outlook reflects:

   * Arch Coal's extensive operations and reserves;
   * its long-term sales contracts; and
   * coal's importance as a fuel for electricity generation.

These factors help insulate the company from the impact of changes
to mining, environmental and electric utility regulations and
provide flexibility for adapting to changes in regional coal
demand.

The ratings could be raised if Arch Coal demonstrates that it can
generate cash from operations and free cash flow such that it can
consistently maintain adjusted debt to EBITDA of less than 4x, FCF
to adjusted debt in the range of 5% and EBIT to interest coverage
of 3 to 4x.  The rating could be lowered if the company's leverage
and debt protection measurements weaken, which could result from
an inability to overcome operating and rail difficulties and fully
benefit from higher coal prices, coupled with the elevated capex
levels now anticipated.  The rating could be lowered if it becomes
apparent that the company is unable to generate cash from
operations of approximately $500 million in 2006, achieve close to
breakeven FCF to adjusted debt in 2006 and at least 3% thereafter
while maintaining a cash balance of at least $100 million, and the
adjusted debt to EBITDA ratio is greater than 4.5x.

Arch Coal, Inc. is the second largest coal company in the U.S.
and, through its western and eastern operations, provides the fuel
for approximately 7% of the electricity generated in the United
States.  Arch is headquartered in St. Louis, Missouri.


ASARCO LLC: Grupo Mexico Unit Files for Chapter 11 in S.D. Tex.
---------------------------------------------------------------
ASARCO LLC filed a voluntary petition for Chapter 11
reorganization in the United States Bankruptcy Court in Corpus
Christi, Texas, yesterday.  

"Asarco has elected to seek protection under the bankruptcy laws
for the benefit of all of its creditors and stakeholders," said
Daniel Tellechea, CEO and President of the Company. "We are
determined to complete our reorganization as quickly and smoothly
as possible," Mr. Tellechea said.

"Asarco regrets any inconvenience that this decision may impose on
its creditors and stakeholders," said Mr. Tellechea, "but we
believe that the Chapter 11 process is the best way for the
Company to reorganize its liabilities, reduce its operating costs
and restructure its balance sheet in order to be viable in the
long term."

"I have been asked, 'Why now'?" said Mr. Tellechea. "Creditors and
labor unions may mistakenly believe that Company operations have
returned to profitability, given currently high copper prices.  
But in fact we are still recovering from the last long downturn in
the copper market.  A number of factors have combined to overwhelm
us, including historical asbestos and environmental liability,
high cost pension and health benefits plans, the current labor
strike and the downgrading of the Company's debt rating. Because
of these factors, Asarco has some of the highest cost operations
in the copper industry.  By filing chapter 11 now, Company
management can act to protect jobs, reduce costs and preserve
Asarco's long-term viability," Mr. Tellechea added.

Approximately 95,000 asbestos-related personal injury claims are
pending against Asarco and two non-operating subsidiaries that
historically engaged in asbestos mining and cement pipe
manufacturing.  Asarco's asbestos-impacted subsidiaries
voluntarily filed for chapter 11 last April in Corpus Christi to
take advantage of the Bankruptcy Code's special provisions for
asbestos-related liabilities.  In addition, Asarco is a party in
numerous consent decrees and lawsuits brought by federal and state
environmental authorities and private entities as a result of the
Company's lead, zinc, cadmium, arsenic and copper mining, smelting
and refining operations over the last 106 years.

"A three-year standstill agreement with the federal government on
environmental remediation obligations, negotiated in 2003, ends in
early 2006," said Mr. Tellechea.  "Although the deadline is
several months away, we are already feeling increased pressure to
meet additional remediation demands.  Global settlement of our
historical environmental liability has not been possible, leaving
Asarco without legal or economic certainty," he concluded.

In June 2004, Asarco began negotiating new collective agreements
with union officials, which include health and pension benefits.
The Company has sought concessions to reduce costs in order to
achieve long-term profitability.  Approximately 1,500 hourly
employees in Arizona and Texas commenced a strike over the July
4th holiday weekend as part of the unions' negotiating strategy.
Asarco's facilities presently are producing copper on a reduced
basis with the help of salaried and some hourly employees.  "We
hope our hourly employees return to work so that Asarco can
improve its existing financial position and continue operating,"
Mr. Tellechea said.

Within the last month, Standard & Poor Services downgraded
Asarco's long-term corporate credit rating from BB- to CCC and
changed its outlook on the Company from positive to negative.  S&P
cited the same challenges and uncertainties Asarco says motivated
the chapter 11 filing.  

Asarco is a Tucson-based integrated copper mining, smelting and
refining company.  Americas Mining Corp. is Asarco's direct
parent, and Grupo Mexico S.A. de C.V. is Asarco's ultimate parent.


ASARCO LLC: S&P Lowers Corporate Credit Rating to D from CCC
------------------------------------------------------------
Standard & Poor's Ratings Services lowered its long-term corporate
credit rating on Asarco Inc. to 'D' from 'CCC' after the company
announced that it voluntary filed for bankruptcy under Chapter 11.
Tucson, Arizona-based Asarco had total debt of about $363 million
as of June 30, 2005.

"Although currently the company has not missed any interest or
principal payments, we consider a bankruptcy filing as a default,"
said Standard & Poor's credit analyst Juan P. Becerra.  "The 'D'
rating is not prospective; rather, it is used only when a default
has actually occurred, and not if a default is only expected."

Asarco's next interest payments are US$100,000 in August and
September, and Standard & Poor's expects that these payments will
not be made.

However, S&P expects AMC to make interest and principal payments
to Asarco.  S&P also said that the 'BBB/Stable/--' rating assigned
to Grupo Mexico S.A. de C.V., Americas Mining Corp., Southern Peru
Copper Corp., and Minera Mexico S.A. de C.V. was not adversely
affected by the voluntary filing for Chapter 11 of Asarco, an AMC
subsidiary.

Asarco has six mining units and four smelters and refinery
complexes located in the U.S. During the first half of 2005, the
company's revenues and total copper production were US$253 million
and 87 thousand metric tons, respectively, which compares
favorably with 2004 numbers.


ASARCO LLC: Fitch Downgrades Senior Unsecured Debt Rating to C  
--------------------------------------------------------------
Fitch Ratings downgraded the senior unsecured rating of Asarco
Inc. to 'C' from 'CCC'.  The company's notes due in 2013 and 2025
for face values of US$100 million and US$150 million,
respectively, have also been downgraded to 'C' from 'CCC.'  All of
these ratings have been placed on Rating Watch Negative.  These
rating actions follow the company's filing yesterday of a
voluntary petition for Chapter 11 reorganization under the United
States Bankruptcy Court in Corpus Christi, Texas.

The 'C' ratings reflect imminent default on the company's next
debt service payment.  In addition to the notes due in 2013 and
2025, Asarco's other outstanding debt obligations consist of
environmental bonds with a face value of approximately US$190
million due between 2018 and 2033.

Asarco's challenges include negotiating with state and federal
authorities over environmental liabilities, with plaintiffs filing
asbestos-related personal injury claims, as well as with the
company's own labor force which has been on strike since early
July 2005.  The company also has high production costs relative to
its peers within the copper industry.

Asarco is 100% owned by of Americas Mining Corporation, a direct
subsidiary of Grupo Mexico, S.A. de C.V. The company's mining
operations are located in the United States and consist of three
open-pit copper mines, Ray, Mission and Silver Bell, in the state
of Arizona.  Asarco also operates a custom smelter in Hayden,
Arizona, a refinery in Amarillo, Texas, and two SX/EW plants.  In
2004, the company produced 155,000 tons of copper.


ASARCO LLC: Case Summary & 20 Largest Unsecured Creditors
---------------------------------------------------------
Debtor: ASARCO LLC
        1150 North Seventh Avenue
        Tucson, Arizona 85705

Bankruptcy Case No.: 05-21207

Type of Business: The Debtor is an integrated copper mining,
                  smelting and refining company.  Americas Mining
                  Corp. is Asarco's direct parent, and Grupo
                  Mexico S.A. de C.V. is Asarco's ultimate parent.
                  See http://www.asarco.com/

                  The Debtor has five affiliates that filed for
                  chapter 11 protection on April 11, 2005 (Bankr.
                  S.D. Tex. Case Nos. 05-20521 thru 05-20525).
                  They are Lac d'Amiante Du Quebec Ltee, CAPCO
                  Pipe Company, Inc., Cement Asbestos Products
                  Company, Lake Asbestos Of Quebec, Ltd., and LAQ
                  Canada, Ltd.  Their petition is reported in the
                  Troubled Company Reporter on Apr. 18, 2005.

Chapter 11 Petition Date: August 9, 2005

Court: Southern District of Texas (Corpus Christi)

Judge: Richard S. Schmidt

Debtor's Counsel: James R. Prince, Esq.
                  Jack L. Kinzie, Esq.
                  Eric A. Soderlund, Esq.
                  Baker Botts L.L.P.
                  2001 Ross Avenue
                  Dallas, Texas 75201
                  Tel: (214) 953-6612
                  Fax: (214) 953-6503

                       -- and --

                  Nathaniel Peter Holzer, Esq.
                  Shelby A. Jordan, Esq.
                  Harlin C. Womble, Esq.
                  Jordan, Hyden, Womble & Culbreth, P.C.
                  500 North Shoreline Drive, Suite 900
                  Corpus Christi, Texas 78471
                  Tel: (361) 884-5678
                  Fax: (361) 888-5555

Total Assets: $600 Million

Total Debts:  $1 Billion

Debtor's 20 Largest Unsecured Creditors:

   Entity                        Nature of Claim    Claim Amount
   ------                        ---------------    ------------
Deutsche Bank Trust Company      Indenture Trustee
Americas                         
Trust Securities Services        Gila County         $73,895,225
60 Wall Street                   Installment Bond
New York City 60-2715            5.55% Series 1998
New York, NY 10005
Attn: Safet Kalabovic
Tel: (212) 250-2679              Lewis & Clark       $35,728,480
                                 County Env
                                 Bond (IRB) 5.85%
                                 Series 1998

                                 Lewis & Clark       $33,668,950
                                 County Env
                                 Bond (IRB) 5.60%
                                 Series 1998

                                 Nueces River        $28,516,721
                                 Env Bond
                                 (IRB) 5.60%
                                 Series 1998

                                 Nueces River        $22,510,800
                                 Env Bond
                                 (IRB) 5.60%
                                 Series 1998A

Wilmington Trust Company         Indenture Trustee
Rodney Square North
1100 North Market Street         CSFB Corporate     $152,125,000
Wilmington, DE 19890-0001        Debentures at
Attn: Joseph W. Callaway, Jr.    8.500%
Tel: (302) 636-6059

Wells Fargo Bank Minnesota NA    CSFB JP Morgan     $101,640,623
Corporate Trust Services         Sec Debentures
608 Second Avenue South          at 7.875%
Minneapolis, MN 55479
Attn: Joseph J. Taffe
Tel: (612) 667-6961

St. Paul Travelers               Surety Bond         $31,369,020
One Square
4PB Hartford, CT 06183
Attn: Robert L. Scanlon
Tel: (860) 277-4275

Mitsui and Co. (U.S.A.), Inc.    Loan                $21,084,000
New York Headquarters
Met Life Building
200 Park Avenue
New York, NY 10166-0130
Attn: Nao Hayashi
Tel: (212) 878-4125

Montana Resources Incorporated   Contractual Debt     $7,729,847
P.O. Box 16630
Missoula, MT 59808
Attn: Greg L. Stricker
Tel: (406) 829-2312

American Home Assurance Co.      Surety Bond          $5,832,064
175 Water Street, 26th Floor
New York, NY 10038
Attn: Todd Robinson
Tel: (212) 458-1621

CAN Surety                       Surety Bond          $4,493,591
333 South Wabash-135
Chicago, IL 60685
Attn: Sylvester Bracey
Tel: (312) 817-3764

Wachovia                         Promissory Note      $2,340,170
301 South College St., 18th Floor
Charlotte, NC 28292-0738
Attn: Lee Hemphill
Tel: (704) 374-4306

Chevron Natural Gas              Trade Debt           $1,850,188
P.O. Box 730116
Dallas, TX 75373-0116
Attn: Michael Surginer
Tel: (832) 854-5020

Sidley Austin Brown & Wood LLP   Legal Fees           $1,699,819
787 Seventh Avenue
New York, NY 10019
Attn: Jonathan Williams
Tel: (212) 839-5310

Road Machinery                   Trade Debt           $1,395,803
716 South Seventh Street
Phoenix, AZ 85034
Attn: Claude Dew
Tel: (602) 256-5152

Komatsu Financial                Equipment Lease      $1,142,313
719 South Seventh Street
Phoenix, AZ 85034
Attn: Randy Smith
Tel: (480) 756-2341

AT&T US Bank                     Lease                $1,053,344
One Federal Street
Boston, MA 02110
Attn: Todd Dinezza
Tel: (617) 603-6573

P&H Mine Pro Services            Trade Creditor         $601,791
3200 Paysphere Circle
Chicago, Illinois
Tel: (480) 834-7656

Williams Detroit Diesel          Trade Creditor         $449,300
West Glenn Street 1375
Tucson, Arizona
Attn: Jerry Martinez
Tel: (520) 624-8377

Department of Justice            Environmental           Unknown
Environmental and Natural
Resources Division
P.O. Box 7611
Washington, D.C. 20044-7611
Attn: David Dain
Tel: (202) 514-3644

State of Washington              Environmental           Unknown
Washington State
Department of Ecology
P.O. Box 47600,
Olympia, WA 98504-7600
Attn: Tim Nord
Tel: (360) 407-7226

State of Texas                   Environmental           Unknown
Texas Commission on
Environmental Quality
MC 175
P.O. Box 13087
Austin, TX 78711-3087
Attn: Paul C. Sarahan
Tel: (512) 239-3424

State of Arizona                 Environmental           Unknown
Arizona Department of
Environmental Quality
Phoenix Main Office
1110 West Washington Street
Phoenix, AZ 85007
Attn: Stephen Owens
Tel: (602) 771-2203


BALLY TOTAL: Moody's Affirms Junk Corporate Family & Debt Ratings
-----------------------------------------------------------------
Moody's Investors Service affirmed the Caa1 corporate family
(formerly senior implied) rating and debt ratings of Bally Total
Fitness Holding Corporation.  The affirmation reflects continued
high risk of default and Moody's estimate of recovery values of
the various classes of debt in a default scenario.  The ratings
outlook remains negative.

Moody's affirmed these ratings:

   * $175 million senior secured term loan B facility due 2009,
     rated B3

   * $100 million senior secured revolving credit facility
     due 2008, rated B3

   * $235 million 10.5% senior unsecured notes (guaranteed)
     due 2011, rated Caa1

   * $300 million 9.875% senior subordinated notes due 2007,
     rated Ca

   * Corporate family rating, rated Caa1

Bally recently announced that it received notices of default under
the indentures governing its senior subordinated and senior notes
following the expiration of the waiver of the financial reporting
covenant default on July 31, 2005.  The notices commence a 30-day
cure period during which Bally must either secure an extension to
the waiver or remedy the default.  The company is negotiating with
bondholders to secure a waiver extension and currently has
received consent from holders of 96.31% of the Senior Notes and
42.88% of Senior Subordinated Notes outstanding.

In addition, the delivery of the notices commences the 10-day
period after which time an event of default occurs under Bally's
$275 million secured credit agreement's cross-default provision.
As a result, delivery of these notices could result in
acceleration of Bally's obligations on or after August 14, 2005,
under the credit agreement and the indentures, causing over $700
million of Bally's debt obligations to become immediately due and
payable.

The negative outlook anticipates minimal revenue growth, impaired
liquidity and minimal, if any, free cash flow from operations over
the next few quarters.  Free cash flows are expected to be
negatively impacted by the recent $14 million arbitration award
against the company, required waiver payments and continuing
investigation costs.  The receipt of a further temporary waiver of
the financial reporting covenant would not likely result in a
change in the ratings outlook.

The outlook could be changed to stable if:

   * the company resolves the SEC investigation;

   * corrects its material deficiencies in internal controls over
     financial reporting;

   * files its restated financial statements with the SEC; and
     
   * maintains adequate liquidity.

If Bally also improves its operating performance by generating
sustainable annualized free cash flows of over $20 million over
the next few fiscal quarters, Moody's would likely change the
outlook to positive.  Asset divestitures that materially improve
leverage and liquidity would also likely benefit the rating.

A decline in the membership base which leads to negative free cash
flow from operations over the next few quarters would likely lead
to a ratings downgrade.

Headquartered in Chicago, Illinois, Bally is the largest
commercial operator of fitness centers in North America.


BEAR STEARNS: Fitch Lifts Rating on $16MM Certs. 1 Notch to BBB-
----------------------------------------------------------------
Fitch Ratings upgrades Bear Stearns Commercial Mortgage Securities
Inc.'s mortgage pass-through certificates, series 2002-PBW1:

     -- $26.5 million class B to 'AA+' from 'AA';
     -- $31.1 million class C to 'A+' from 'A';
     -- $8.1 million class D to 'A' from 'A-';
     -- $9.2 million class E to 'A-' from 'BBB+';
     -- $13.8 million class F to 'BBB+' from 'BBB';
     -- $13.8 million class G to 'BBB' from 'BBB-';
     -- $16.1 million class H to 'BBB-' from 'BB+'.

In addition, Fitch affirms these classes:

     -- $327.6 million class A-1 'AAA';
     -- $385.9 million class A-2 'AAA';
     -- Interest-only classes X-1 and X-2 'AAA';
     -- $10.4 million class J 'BB';
     -- $3.5 million class K 'BB-';
     -- $5.8 million class L 'B+';
     -- $9.2 million class M 'B';
     -- $2.3 million class N 'B-'.

Fitch does not rate the $13.8 million class P.

The rating upgrades reflect the improved credit enhancement levels
from scheduled amortization and defeasance.  As of the July 2005
distribution date, the pool has paid down 5.06%, to $876.9.2
million from $921.2 million at issuance.  By outstanding balance,
the pool consists of retail (39%), office (25%), multifamily
(21%), industrial (10%), self storage (1%).  There are currently
no delinquent or specially serviced loans in the pool.

Fitch reviewed the credit assessments of three loans in pool, the
Belz Outlet Center (7.0%), the RREEF Master Trust Portfolio
(4.7%), and the CNL Retail Portfolio (2.3%).  The Belz Outlet
Center loan is no longer considered investment grade.  The RREEFF
Master Portfolio and the CNL portfolio maintain investment grade
credit assessments.

The Belz Outlet Center loan is secured by a 637,772 square foot
retail center located in Orlando, Florida.  The stressed debt
service coverage ratio based on leases in place was 1.01 times
(x), compared to 1.45x at issuance.  The decline in NCF is
primarily attributed to a drop in base rents and a decline in
occupancy.  Occupancy as of June 2005, was 84% compared to 92% at
issuance.  The major tenants are Sears (4.0%), Rockport (3.5%),
Nike (3.5%), and the Gap (2.4%).

The RREEF Textron Portfolio loan is secured by seven properties.  
The stressed DSCR for YE 2004 was 3.08x, compared to 2.93x at
issuance.  As of YE 2004 the overall occupancy of the portfolio
was 94%.

The CNL Retail Portfolio loan is secured by retail building
housing five single-tenant retail stores totaling 210,885-sf
located in Florida and Virginia.  The five tenants in the CNL
Retail Portfolio are Barnes & Nobles, Kash n' Karry, Bed Bath &
Beyond, Best Buy, and Borders Books.  The stressed DSCR for YE
2004 was 1.34x, compared to 1.39x at issuance.  As of YE 2004, the
portfolio was 100% occupied.

The DSCR for each loan is calculated using borrower provided net
operating income less required reserves divided by debt service
payments based on the current balance using a Fitch stressed
refinance constant.


BEAR STEARNS: Fitch Upgrades Two Low-B Rated Certificate Classes
----------------------------------------------------------------
Fitch Ratings upgrades Bear Stearns Commercial Mortgage Securities
Inc., commercial mortgage pass-through certificates, series 2000-
WF1:

Fitch upgrades these classes:

     -- $31 million class B certificates to 'AAA' from 'AA+';
     -- $35.5 million class C certificates to 'AA+' from 'A+';
     -- $8.9 million class D certificates to 'AA' from 'A';
     -- $26.6 million class E certificates to 'A' from 'BBB+';
     -- $8.9 million class F certificates to 'A-' from 'BBB';
     -- $15.5 million class G certificates to 'BBB' from 'BB+';
     -- $13.3 million class H certificates to 'BB+' from 'BB'.

In addition, these classes are affirmed:

     -- $90.7 million class A-1 at 'AAA';
     -- $455.0 million class A-2 at 'AAA';
     -- Interest-only class X at 'AAA';
     -- $31.1 million class B at 'AA';
     -- $6.7 million class I at 'BB-';
     -- $5.6 million class J at 'B+';
     -- $8.9 million class K at 'B';
     -- $3.3 million class L remains 'CCC'.

Fitch does not rate the $3.4 million class M.

The rating upgrades reflect the improved credit enhancement levels
resulting from loan payoffs, amortization and the defeasance of an
additional 15 loans since Fitch's last ratings action.  To date 19
loans have defeased representing 18.14% of the pool, including the
third largest loan at issuance, Private Mini Storage.  One of the
two credit assessed loans, First Union Capitol, has been paid off
in full.

As of the July 2005 distribution report, the pool's aggregate
certificate balance was reduced by 18.83% to $713.4 million from
$888.3 million at issuance.  There are no delinquent or specially
serviced loans.

Fitch has reviewed the credit assessed loan in the pool, 650
Townsend Center which maintains its investment-grade credit
assessment.

The 650 Townsend Center loan is secured by a 612,848 square foot
office building located in the South of Market submarket of San
Francisco, CA.  As of year-end 2004, the Fitch-stressed debt
service coverage ratio was 2.02 times (x), versus 1.52x at
issuance.  The Fitch-stressed DSCR is based on cash flow adjusted
for vacancy, capital expenditures, reserves, and a stressed debt
service based on a 9.66% constant.  Of concern to Fitch is the
drop in occupancy.  As of YE 2004, occupancy has decreased to 81%
as compared with 85% for YE 2003 and 98% at issuance.  However,
the property's occupancy remains above market levels of
approximately 79%.


BIOLASE INC: BDO Seidman Replaces PwC as Independent Auditors
-------------------------------------------------------------
BIOLASE Technology, Inc. (NASDAQ: BLTIE) has engaged BDO Seidman,
LLP, as its new independent public accountant, nunc pro tunc to
Aug. 8, 2005.  The Company's Audit Committee previously approved
the dismissal of PricewaterhouseCoopers LLP as BIOLASE's
independent registered public accounting firm.

The reports of PwC on the Company's financial statements as of and
for the fiscal years ended Dec. 31, 2004, and 2003 contained no
adverse opinion or disclaimer of opinion, nor were they qualified
or modified as to uncertainty, audit scope or accounting
principle.

                     PwC Disagreements

During the fiscal years ended December 31, 2004 and 2003 and
through August 3, 2005, there were two disagreements with PWC on
matters regarding accounting principles and practices, financial
statement disclosure, or auditing scope or procedure.  These
disagreements, although ultimately resolved to the satisfaction of
PwC, were reportable events required by the Securities and
Exchange Commission:

   -- a disagreement during the year ended Dec. 31, 2003, related
      to revenue recognition; and

   -- a disagreement during the year ended Dec. 31, 2004, related
      to the accounting for penalties and interest on sales tax.

The Company's Audit Committee has discussed the foregoing
disagreements with PwC and has authorized PwC to respond fully to
BDO, the new independent registered public accounting firm for the
Company, concerning these disagreements.  Except for the
disagreements noted above, there were no disagreements with PwC on
the matters noted above for the fiscal years ended Dec. 31, 2004
and 2003 and through Aug. 3, 2005, that would have caused PwC to
make reference thereto in their reports on the Company's financial
statements for such years if such matters were not resolved to the
satisfaction of PWC.

                     Material Weaknesses

The Company has identified certain material weaknesses in the
Company's internal control over financial reporting for the fiscal
year ended Dec. 31, 2004, and another set of material weaknesses
for the fiscal year ended Dec. 31, 2003.  

The Company has requested that PwC furnish the Company with a
letter addressed to the SEC stating whether or not it agrees with
the foregoing statements by the Company and, if not, stating the
respects in which it does not agree.  

During the Company's two most recent fiscal years and through
Aug. 8, 2005, the Company did not consult with BDO with respect to
the application of accounting principles to a specified
transaction, either completed or proposed, or the type of audit
opinion that might be rendered on the Company's financial
statements, or any other matters or reportable events.

                        Filing Extension

The NASDAQ Stock Market, Inc., gave the Company until Sept. 30,
2005, to file its Forms 10-Q for the fiscal quarters ended
March 31, 2005, and June 30, 2005, and to otherwise meet all
necessary listing standards of The NASDAQ National Market.  The
Company has agreed to keep NASDAQ apprised of its progress as it
works to complete its Forms 10-Q.

BIOLASE Technology, Inc. -- http://www.biolase.com/-- is a  
medical technology company that designs, manufactures and markets
proprietary dental laser systems that allow dentists, oral
surgeons and other specialists to perform a broad range of common
dental procedures, including cosmetic applications.  The company's
products incorporate patented and patent pending technologies
focused on reducing pain and improving clinical results.  Its
primary product, the Waterlase(R) system, is the best selling
dental laser system.  The Waterlase(R) system uses a patented
combination of water and laser to precisely cut hard tissue, such
as bone and teeth, and soft tissue, such as gums, with minimal or
no damage to surrounding tissue.  The company also offers the
LaserSmile(TM) system, which uses a laser to perform soft tissue
and cosmetic procedures, including tooth whitening.


BLOCKBUSTER INC: Lenders Waive Covenant Violations & Secure Loans
-----------------------------------------------------------------
Blockbuster Inc. amended its credit agreement dated Aug. 20, 2004,
with a group of lenders led by JPMorgan Chase Bank, N.A., on
Aug. 8, 2005.  The amendment waives second and third quarter
leverage ratio covenant violations and a third quarter fixed
charge coverage covenant breach.  Without this waiver, Blockbuster
would have been in default under the Credit Agreement.  The Waiver
runs through the date on which the Borrower delivers to the
Administrative Agent audited consolidated financial statements as
of and for the fiscal year ending on December 31, 2005.

The second amendment makes seven key changes to the credit
agreement:

    (A) Blockbuster's interest costs will rise -- the applicable
        margin is increased by 50 basis points through the end of
        the waiver period;

    (B) Blockbuster paid the Lenders an Amendment Fee equal to
        0.125% of the sum of outstanding Term Loans and Revolving
        Commitments;

    (C) loans are now secured by liens on substantially all of
        the Company's domestic assets (other than its real estate
        leasehold interests);

    (D) increased obligations with respect to mandatory
        prepayments from asset sales;  

    (E) additional limitations on payment of dividends,
        repurchases and other distributions in respect of the
        Company's stock and other equity ownership interests;  

    (F) additional limitations with respect to the amount of
        unsecured indebtedness the Company may incur, the amount
        of franchisee indebtedness the Company may guarantee and
        the amount of investments, including investments in the
        Company's foreign subsidiaries, it may make; and  

    (G) a restriction on the Company's ability to repurchase
        subordinated debt with the proceeds of equity issuances.  

The second amendment also provides for additional restrictions
during the waiver period, which will end at the time the Company
is required to deliver its 2005 audited financial statements,
including:

    (1) compliance with minimum consolidated EBITDA covenants:

        -- Consolidated EBITDA for the fiscal quarter ending on
           September 30, 2005, must exceed $45,000,000; and

        -- Consolidated EBITDA for the two fiscal quarters ending
           on December 31, 2005, must exceed $250,000,000;

    (2) limitations on capital expenditures:

        -- CapEx will not exceed $40,000,000 for the fiscal
           quarter ending on September 30, 2005; and

        -- CapEx will not exceed $75,000,000 for the two fiscal
           quarters ending on December 31, 2005;

    (3) restrictions on the Company's ability to make additional
        revolving credit borrowings and mandatory prepayments of a
        portion of outstanding borrowings if the Company's cash
        and cash equivalents are in excess of certain agreed
        amounts;  

    (4) additional reporting requirements;  

    (5) additional limitations on payment of dividends,
        repurchases and other distributions in respect of the
        Company's stock and other equity ownership interests;  

    (6) additional limitations on the amount of investments,
        including investments in its foreign subsidiaries, the
        Company may make; and  

    (7) prohibitions on certain acquisitions by the Company and
        its subsidiaries.  

Based upon projected operating results, the Company believes it
will be in compliance with the applicable debt covenants through
the waiver period and through June 30, 2006.  Therefore, all
amounts outstanding under the credit agreement have been
classified as non-current as of June 30, 2005.

Assuming continued compliance with the covenants discussed, the
Company expects cash on hand, cash from operations and available
borrowings under its revolving credit facility to be sufficient to
fund the anticipated cash requirements for working capital
purposes and capital expenditures under its normal operations,
including the additional spending on its initiatives, as well as
commitments and payments of principal and interest on borrowings
for at least the next twelve months.

While the Company expects to be in compliance with all covenants
in the future, the continued declines and uncertainty in the
rental industry could adversely impact expected results for the
remainder of 2005 as well as 2006.  If the Company was not in
compliance with the applicable debt covenants, it would be
required to engage in negotiations with its syndicate of lenders
in order to obtain further relief from its debt obligations and
should these discussions prove unsuccessful, the Company would be
required to search for alternative measures to finance current and
ongoing obligations of its business.

Beginning with the year ending Dec. 31, 2005, the Company is
required to make prepayments on the credit facilities in an
aggregate amount equal to 50% of annual excess cash flow, as
defined by the credit agreement.  Those payments are due at the
end of the first quarter of the following year.

Blockbuster Inc. -- http://www.blockbuster.com/-- is a leading  
global provider of in-home movie and game entertainment, with more
than 9,100 stores throughout the Americas, Europe, Asia and
Australia.

                         *     *     *

As reported in the Troubled Company Reporter on Aug. 5, 2005,
Standard & Poor's Ratings Services placed its ratings for Dallas,
Texas-based Blockbuster Inc., including the 'BB-' corporate credit
rating, on CreditWatch with negative implications.

"This action follows the company's announcement that its second-
quarter movie rental business was hurt by weak DVD releases and
that there is concern about the remainder of the year," said
Standard & Poor's credit analyst Diane Shand.

Industry fundamentals for the video rental market are weak, and
Blockbuster's profitability is heavily dependent on that market.
The company generated 65% of its total sales from its movie rental
business in 2004, and its domestic rental same-store sales have
been weak since 2001.  Retail sales of videos have been growing
faster than the rental market since at least 1993.  Moreover, the
rental market has declined slightly over the past three years, and
is expected to decline annually at a low single-digit percentage
rate over the next three years.

In response to weak rental industry dynamics, Blockbuster is
trying to increase customer traffic by eliminating late fees.  
This affects revenues by an estimated $400 million to $450 million
and operating income by $250 million to $300 million.  In
addition, the company is attempting to transform itself into a
home entertainment store: It has launched a national in-store
rental subscription program and is expanding its store-in-store
game concept.  Blockbuster also is rolling out an online
subscription plan and a movie trading business.


BLOCKBUSTER INC: Posts $57.2 Million Net Loss in Second Quarter
---------------------------------------------------------------
Blockbuster Inc. (NYSE: BBI, BBI.B) reported financial results for
the second quarter ended June 30, 2005.  Total revenues decreased
1.6% to $1.40 billion for the second quarter of 2005 from $1.42
billion for the second quarter of 2004.

Net loss for the second quarter of 2005 totaled $57.2 million,
compared with net income of $48.6 million, for the second quarter
of 2004.  Adjusted net loss for the second quarter of 2005 totaled
$40.2 million, excluding non-cash charges related to share-based
compensation and impairment of certain long- lived assets and non-
recurring costs incurred for employee severance.  

"Our second quarter results reflect both the success of our new
initiatives as well as the impact of the declining store-based
video rental industry," said John Antioco, Blockbuster chairman
and CEO.  "Our 'No Late Fees' program is working, and our online
business continues to perform extremely well.  These two
initiatives helped increase our total rental revenues 9% quarter
over quarter, excluding extended viewing fee revenues.  Although
we invested heavily to achieve our revenue results, which combined
with industry trends impacted our bottom line, we believe we are
affecting a permanent improvement in our business that will enable
us to address the decline in our core rental business, develop new
revenue streams and drive future growth."

Since the beginning of the year, Blockbuster has focused on
delivering a plan that drives growth in both active members in
stores and subscribers for BLOCKBUSTER Online. The investment in
these two initiatives was designed to better position the Company
to grow future revenues and profits even with a declining in-store
rental industry. Even though the in-store rental industry declined
in the second quarter, with the month of June down substantially
more than anticipated, Blockbuster is experiencing certain
favorable trends from the investments in its business.

The elimination of extended viewing fees under the "No Late Fees"
program negatively impacted rental revenues by almost $140 million
in the second quarter of 2005, but was largely offset by:

    * Base rental revenues, which consist of online and in-store
      rentals and exclude the impact of extended viewing fees,
      increased 9% year over year.  Extended viewing fees
      accounted for approximately 15% of the Company's rental
      revenues during the second quarter of 2004.

    * Rental transactions for the second quarter increased by
      10.4% over the same period last year.

    * Active member trends in company-operated domestic stores
      continued to show improvement for both the quarter and first
      six months of the year.

Additionally, the active member trends in company-operated
domestic stores are significantly better than those in domestic
franchise stores that have not eliminated extended viewing fees.

For the second quarter of 2005, total revenues decreased 1.6% to
$1.40 billion from $1.42 billion for the second quarter of 2004,
primarily as a result of a decrease in extended viewing fees,
which was largely offset by growth in base rental revenues and
retail sales of games.  The worldwide in- store home video rental
industry was negatively impacted during the second quarter of 2005
by a substantially weaker home video release schedule and other
negative industry trends.  These negative trends include increased
competition for consumers' leisure time from other forms of
entertainment, competition from online rentals and retail mass
merchants and competition from piracy in certain international
markets.

While these factors had an overall negative impact on
Blockbuster's rental revenues, a large portion of this decrease
was offset by an increase in base rental revenues due to the
popularity of in-store and online subscription programs and the
increased frequency of store visits by the Company's active
members during the second quarter of 2005.  Total worldwide same-
store revenues decreased 4.7% from the same period in the prior
year, as a result of a decline in worldwide same- store rental
revenues, which was partially offset by growth in worldwide same-
store retail revenues driven by strong growth in game sales.

Total rental revenues, which represented 73.0% of total revenues
for the second quarter of 2005, decreased 5.2% to $1.02 billion
from $1.08 billion for the same period last year, primarily as a
result of the $138.1 million decrease in extended viewing fee
revenues from the second quarter of 2004 to the second quarter of
2005, caused by the launch of the "No Late Fees" program in the
United States and Canada.  The decrease in extended viewing fee
revenues, coupled with the weak home video industry, caused a 6.6%
decrease in worldwide same-store rental revenues for the second
quarter of 2005 from the second quarter of 2004.  However, these
trends were largely offset by growth in base rental revenues from
the Company's strategic initiatives implemented in 2004 and 2005,
including growth in the popularity of the in-store rental pass and
BLOCKBUSTER Online, and an increase in frequency of visits by
active members during the quarter.

Total retail revenues, which represented 25.8% of total revenues
for the second quarter of 2005, increased 11.5% to $360.4 million
from $323.2 million for the second quarter of 2004 primarily as a
result of additional company- operated stores, including
freestanding game stores, and an increase in worldwide same-store
retail revenues.  Worldwide same-store retail revenues for the
second quarter of 2005 increased 1.8% as a result of growth in
sales of new and traded games, which was partially offset by
decreased movie sales.

For the second quarter of 2005, gross profit decreased 11.5% to
$770.8 million from $871.4 million for the second quarter of 2004.
Rental gross profit for the second quarter of 2005 decreased 13.0%
to $677.1 million from $778.5 million for the second quarter of
2004.  Rental gross margin for the second quarter of 2005
decreased 600 basis points to 66.4% compared with 72.4% for the
second quarter of 2004 primarily due to:

    (i) lower gross margin results from BLOCKBUSTER Online caused
        by the increased product purchases necessary to grow the
        business and the inclusion of shipping costs from the
        online business in cost of rental revenues and

   (ii) the combination of decreasing revenues per transaction and
        increasing product purchases, each of which resulted from
        the launch of BLOCKBUSTER Movie Pass(R) and the "No Late
        Fees" program.

Retail gross profit for the second quarter of 2005 increased 7.1%
to $75.9 million from $70.9 million for the second quarter of 2004
as a result of growth in retail revenues.  Retail gross margin of
21.1% in the second quarter of 2005 remained relatively flat as
compared with 21.9% for the second quarter of 2004.  Total gross
margin for the second quarter of 2005 was 55.1% compared with
61.3% for the second quarter of 2004, primarily as a result of the
decrease in rental gross margin as discussed above and growth in
retail revenues as a percentage of total revenues.

During the second quarter of 2005, the Company experienced a
favorable impact from foreign exchange rates that resulted in
increased revenues and operating expenses, but had a minimal
impact on operating results.

Net cash flow provided by operating activities decreased to $164.7
million for the second quarter of 2005 from $268.8 million for the
second quarter of 2004.

Free cash flow (net cash flow provided by operating activities
less rental library purchases and capital expenditures) was
negative $118.7 million for the second quarter of 2005 compared
with positive $23.0 million for the same period last year.

Blockbuster Inc. -- http://www.blockbuster.com/-- is a leading  
global provider of in-home movie and game entertainment, with more
than 9,100 stores throughout the Americas, Europe, Asia and
Australia.

                         *     *     *

As reported in the Troubled Company Reporter on Aug. 5, 2005,
Standard & Poor's Ratings Services placed its ratings for Dallas,
Texas-based Blockbuster Inc., including the 'BB-' corporate credit
rating, on CreditWatch with negative implications.

"This action follows the company's announcement that its second-
quarter movie rental business was hurt by weak DVD releases and
that there is concern about the remainder of the year," said
Standard & Poor's credit analyst Diane Shand.

Industry fundamentals for the video rental market are weak, and
Blockbuster's profitability is heavily dependent on that market.
The company generated 65% of its total sales from its movie rental
business in 2004, and its domestic rental same-store sales have
been weak since 2001.  Retail sales of videos have been growing
faster than the rental market since at least 1993.  Moreover, the
rental market has declined slightly over the past three years, and
is expected to decline annually at a low single-digit percentage
rate over the next three years.

In response to weak rental industry dynamics, Blockbuster is
trying to increase customer traffic by eliminating late fees.  
This affects revenues by an estimated $400 million to $450 million
and operating income by $250 million to $300 million.  In
addition, the company is attempting to transform itself into a
home entertainment store: It has launched a national in-store
rental subscription program and is expanding its store-in-store
game concept.  Blockbuster also is rolling out an online
subscription plan and a movie trading business.


BUEHLER FOODS: Has Until Sept. 6 to Make Lease-Related Decisions
----------------------------------------------------------------          
The U.S. Bankruptcy Court for the Southern District of Indiana
extended, until Sept. 6, 2005, the period within which Buehler
Foods, Inc., and its debtor-affiliates can elect to assume, assume
and assign, or reject their unexpired nonresidential real property
leases.

The Debtors are parties to approximately 60 nonresidential real
property leases with various landlords.

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

   1) they are still operating their businesses out of the
      majority of the unexpired leases, making those leases an
      important part of their immediate and long term
      reorganization efforts;

   2) it will not be in the best interests of the their estates
      and their creditors to prematurely assume the unexpired
      leases and incur substantial administrative expenses as well
      as significant cure obligations for those leases which may
      be over market or unnecessary for their reorganization;
      and

   3) the extension will not prejudice the landlords of the
      unexpired because the Debtors are current on all post-
      petition obligations to those landlords as required under
      Section 365(d)(3) of the Bankruptcy Code.

Headquartered in Jasper, Indiana, Buehler Foods, Inc., owns and
operates grocery stores under the BUY LOW and Save-A-Lot banners
in Illinois, Indiana, and Kentucky, North Carolina, and Virginia.
The company also sells gas at about a dozen locations.  In 2004
Buehler Foods acquired 16 Winn-Dixie stores in Louisville,
Kentucky, and renamed them Buehler's Markets.  Founded in 1940,
the company is still run by the Buehler family.  The Company,
along with its three affiliates, filed for chapter 11 protection
on May 5, 2005 (Bankr. S.D. Ind. Case No. 05-70961).  Jerald I.
Ancel, Esq., at Sommer Barnard Attorneys, PC, represents the
Debtors in their restructuring efforts.  When the Debtor filed for
protection from its creditors, it estimated assets of $10 million
to $50 million and debts of $50 million to $100 million.


CAMCO INC: Equity Deficit Narrows to $13.9 Million at June 25
-------------------------------------------------------------
Camco Inc. (TSX:COC) reported net income of $3.7 million for the
second quarter ending June 25, 2005.  This compares to a net loss
of $1.9 million for the same period last year, due to significant
provisions for Hamilton plant closure costs.  Total sales for the
second quarter amounted to $170 million, up 2% from sales of $167
million for the second quarter of 2004.

Closure-related expenses of $0.2 million related to final
dismantling associated with the Hamilton plant, were recorded
in the second quarter of 2005 compared to closure costs of
$6.5 million for the same period last year.  Income from
operations, before closure costs and write-downs, in the second
quarter rose to $6.0 million, compared to $4.2 million in 2004.

For the first half of 2005, the Company recorded net income of
$9.0 million on sales of $302 million compared to a net loss of
$5.6 million on sales of $290 million in 2004.  Income from
operations, before closure costs and write-downs, were
$3.9 million, compared to $4.8 million in 2004 as a result of
recent increases in commodity prices, especially steel and
plastic.

As announced on July 25, 2005, Controladora Mabe S.A. de C.V. of
Mexico and the Company have entered into a Support Agreement
pursuant to which 6295053 Canada Inc., a wholly owned subsidiary
of Mabe, will make an offer to purchase all of the common shares
of the Company at a price of $3.52 per share for an aggregate
value of approximately $70.4 million.

James Fleck, President and CEO commented: "The market for home
appliances was quite robust during the first half of the year, and
this was a major contributor to Camco's strong performance.
Material cost inflation continued to be a critical issue for the
Company, and as a result price increases were implemented in
Canada and the US.  Most significantly, Camco reached an agreement
with GE that effectively increases dryer prices retroactively for
the first half of 2005. In the event that the Mabe transaction
does not close in the third quarter, the dryer supply agreement
with GE will need to be renegotiated".

Camco, Inc. -- http://www.geappliances.ca/-- is the largest   
Canadian manufacturer, marketer and service provider of home
appliances, with manufacturing operations in Montreal, Quebec.
The Company's product line includes such popular names as GE,
Hotpoint, Moffat, Monogram, BeefEater and Samsung.  Camco also
produces and services private brands for major Canadian department
stores.
       
As of June 25, 2005, Camco's stockholders' deficit narrowed to
$13,911,000 compared to a $22,879,000 deficit at Dec. 31, 2005.


CATHOLIC CHURCH: Portland Court Names Judge Dunn as Pre-Mediator
----------------------------------------------------------------
The U.S. Bankruptcy Court for the District of Oregon appointed
Judge Randall L. Dunn as pre-mediator between the Archdiocese of
Portland in Oregon and certain tort claimants in their attempt to
negotiate the terms of a "pattern" settlement agreement for the
forthcoming mediations.

Despite a full day of effort and the discussion of several
creative and constructive ideas, David Slader, Esq., at David L.
Slader Trial Lawyers PC, in Portland, Oregon, relates that both
parties were unable to reach an agreement on a template.  
However, there was a useful exchange of ideas and both parties
reached a better understanding of each other's positions.

"Some of Judge Dunn's suggestions may eventually serve as the
kernel of a consensual plan," Mr. Slader says.

Mr. Slader further relates that at the scheduled mediations, the
claimants will attempt to resolve, on a case-by-case basis, the
issues that continue to divide them -- most significantly the date
by which a settling plaintiff could expect to receive any agreed
compensation.

The Archdiocese of Portland in Oregon filed for chapter 11
protection (Bankr. Ore. Case No. 04-37154) on July 6, 2004.  
Thomas W. Stilley, Esq., and William N. Stiles, Esq., at Sussman
Shank LLP, represent the Portland Archdiocese in its restructuring
efforts.  In its Schedules of Assets and Liabilities filed with
the Court on July 30, 2004, the Portland Archdiocese reports
$19,251,558 in assets and $373,015,566 in liabilities.  (Catholic  
Church Bankruptcy News, Issue No. 37; Bankruptcy Creditors'  
Service, Inc., 215/945-7000)


CENTRAL PARKING: Earns $5.3 Million of Net Income in Third Quarter
------------------------------------------------------------------
Central Parking Corporation (NYSE:CPC) disclosed earnings from
continuing operations for the third quarter ended June 30, 2005,
of $5.3 million compared with $6.6 million earned in the third
quarter of the previous fiscal year.

Earnings from continuing operations for the quarter were reduced
by pre-tax property-related losses of $3.3 million, which included
$2.8 million in charges resulting from the renegotiation of an
unprofitable lease, partially offset by a gain of $2.1 million
from the sale of real estate.  The lease, which had operating
losses of approximately $700,000 in fiscal 2004 and a term through
2013, is now profitable under the renegotiated terms.

Net earnings for the third quarter of fiscal 2005 were
$4.9 million, compared with net earnings of $6.0 million, in the
quarter ended June 30, 2004.  Total revenues for the quarter
increased 6.6% to $310.5 million, while revenues excluding
reimbursed management expenses declined 3.6% to $171.3 million.

Earnings from continuing operations for the nine months ended
June 30, 2005, were $17.6 million, or $0.48 per fully diluted
share, compared with $18.8 million, or $0.52 per share in the
year-earlier period.  Net earnings for the first nine months of
fiscal 2005 were $14.6 million, compared with $17.9 million, in
the year-earlier period.  Total revenues increased 4.2% to
$907.7 million, while revenues excluding reimbursed management
expenses declined 4.3% to $508 million.

"The results for the third quarter were consistent with our
expectations," said Monroe J. Carell, Jr., Chairman and Chief
Executive Officer.  "Operating fundamentals were positive for the
quarter, with a net increase in new locations and same-store-sales
growth of 1.9 percent.  We also made further progress in lowering
debt during the quarter as cash flow from operations and
proceeds from property sales were used to reduce indebtedness by
$8.7 million.

"Net earnings for the quarter were negatively affected by
approximately $1.1 million in costs related to the Company's
Sarbanes Oxley compliance initiative, approximately $800,000 in
costs related to the terminated discussions regarding the
potential sale of the Company and approximately $200,000 in
severance costs.  Third quarter earnings also were reduced by the
successful renegotiation of an unprofitable lease as we
continued our efforts to improve future operating results."

"Due primarily to the previously announced sale of a leasehold
interest in a garage at 839 Sixth Avenue in New York City, which
will result in an after-tax property-related gain in the Company's
fourth fiscal quarter of approximately $23 million, or $0.62 per
diluted share, we are revising our earnings guidance for
continuing operations, including property-related gains or losses,
for fiscal 2005, to a range of $1.15 to $1.25 per share," Mr.
Carell concluded.

Central Parking Corporation, headquartered in Nashville,
Tennessee, is a leading global provider of parking and
transportation management services.  As of June 30, 2005 the
Company operated more than 3,400 parking facilities containing
more than 1.5 million spaces at locations in 37 states, the
District of Columbia, Canada, Puerto Rico, the United Kingdom, the
Republic of Ireland, Mexico, Chile, Peru, Colombia, Venezuela,
Germany, Switzerland, Poland, Spain, Greece and Italy.

                         *     *     *

As reported in the Troubled Company Reporter on March 18, 2005,  
Standard & Poor's Ratings Services placed its ratings on
Nashville, Tennessee-based Central Parking Corp., including the  
company's 'B+' corporate credit rating, on CreditWatch with  
negative implications.  This means that the ratings could be  
affirmed or lowered following the completion of Standard & Poor's  
review.


CENTURY/ML: Claims Classification & Treatment Under Ch. 11 Plan
---------------------------------------------------------------
Century/ML Cable Venture's Plan of Reorganization groups claims
and interests into six classes pursuant to Section 1122 of the
Bankruptcy Code.

As provided in Section 1123(a)(1) of the Bankruptcy Code,
Administrative Expense Claims and Priority Tax Claims against
Century/ML are not classified for purposes of voting on or
receiving distributions under the Plan.

The classification and treatment of claims under Century/ML'S
Plan of Reorganization are summarized as:

Class      Description            Treatment
-----      -----------            ---------
  N/A       Administrative         Paid in full, in cash
            Expense Claims

  N/A       Priority Tax Claims    Paid in full, in cash
                                   Estimated Claims: $1,253,087

   1        Secured Claims         Paid in full

                                   Unimpaired, deemed to accept
                                   Plan

   2        Priority Claims        Paid in full

                                   Unimpaired, deemed to accept
                                   Plan

   3        Personal Injury and    Paid in full
            Other Claims
                                   Unimpaired, deemed to accept
                                   Plan

   4        General Unsecured      Paid in full
            Claims
                                   Unimpaired, deemed to accept
                                   Plan

   5        Litigation Claims      Paid in full

                                   Unimpaired, deemed to accept
                                   Plan

   6        Equity Interests       Distribution of remaining
                                   proceeds from Sale
                                   Transaction

                                   Impaired, entitled to vote

The sole holders of Equity Interests are ML Media Partners, L.P.,
(50%) and Century Communications Corporation (50%).

A full-text copy of Century/ML Cable Venture's Plan of
Reorganization is available at no charge at:

            http://ResearchArchives.com/t/s?b6

A full-text copy of Century/ML Cable Venture's Disclosure
Statement is available at no charge at:

            http://ResearchArchives.com/t/s?b7

Century Communications Corporation filed for Chapter 11 protection
on June 10, 2002.  Century's case has been jointly administered to
proceedings of Adelphia Communications Corporation.  Century
operates cable television services in Colorado, California and
Puerto Rico.  CENTURY is an indirect wholly owned subsidiary of
ACOM and an affiliate of Adelphia Business Solutions, Inc.
Lawyers at Willkie, Farr & Gallagher represent CENTURY.

Headquartered in Coudersport, Pennsylvania, Adelphia
Communications Corporation (OTC: ADELQ) is the fifth-largest cable
television company in the country.  Adelphia serves customers in
30 states and Puerto Rico, and offers analog and digital video
services, high-speed Internet access and other advanced services
over its broadband networks.  The Company and its more than
200 affiliates filed for Chapter 11 protection in the Southern
District of New York on June 25, 2002.  Those cases are jointly
administered under case number 02-41729.  Willkie Farr & Gallagher
represents the ACOM Debtors.  (Adelphia Bankruptcy News, Issue No.
102; Bankruptcy Creditors' Service, Inc., 215/945-7000)


CHARTER COMMS: Neil Smit Succeeds Robert May as President & CEO
---------------------------------------------------------------
The Board of Directors for Charter Communications, Inc. (Nasdaq:
CHTR) unanimously elected Neil Smit to the position of President
and Chief Executive Officer, effective Aug. 22, 2005.  Mr. Smit
will also serve as a member of Charter's Board of Directors.  He
succeeds Robert P. May, a Charter Board Member who has served as
Charter's Interim President and Chief Executive Officer since
January 2005.  Mr. May will remain a member of Charter's Board of
Directors and a member of its Strategic Planning Committee.

Mr. Smit brings significant operational experience to Charter,
having most recently served as the President of Time Warner's
America Online Access Business, overseeing Internet access
services including AOL, CompuServe, and Netscape ISP.  As
President, he was responsible for all aspects of the $5 billion
revenue, 21 million-member ISP business, including member
acquisitions, retention, brand marketing, product definition,
customer service, business development and finance.  He oversaw
the work of more than 11,000 people.

"Neil is a proven, talented executive with the right combination
of operational, marketing and customer service skills to lead
Charter to the next level," said Paul G. Allen, Chairman of
Charter's Board of Directors.  "He brings a wealth of practical
know-how built over an impressive 20-year career working with
multi-service providers and leading consumer brands.  He also has
a real vision of the opportunities and challenges in today's
rapidly converging entertainment and communications industries
that will benefit Charter.  We're delighted he's part of our team
and look forward to him continuing to implement our comprehensive
operations improvement program to better position Charter for
growth."

"I am excited to be joining Charter and I look forward to being
part of Charter's management team as we continue the positive
momentum begun over the past year to stimulate growth and deliver
value to our customers and shareholders," Mr. Smit said.  "Charter
has the workforce, the network, and the products and services in
place to become a formidable player in the provision of bundled
video, data and telecommunications services, where technological
advances and quality customer care provide real growth
opportunities."

Mr. Smit, 46, has an extensive background in customer service,
sales and operations.  At AOL, he was also Executive Vice
President, Member Development, where he oversaw retention
marketing, customer service, new revenue and renewal/payment
marketing.  He also served as Executive Vice President, Member
Services, AOL's largest operational role, and oversaw its global
service-center staff of 10,000 that handle issues such as
registration, retention, billing, upsell and technical assistance.  
Prior to that, Mr. Smit had been Senior Vice President of AOL's
product and programming team, where he managed programming,
promotion, and market development for AOL categories including
autos, computing, consumer electronics, consumer packaged goods,
local, and small business.  He also has served as Chief Operating
Officer of AOL Local, managing all aspects of programming and
technology for the group and as Chief Operating Officer of
MapQuest managing its three business areas.

Before joining AOL in 2000, Mr. Smit spent 10 years in the
consumer packaged-goods industry.  He was a regional president
with Nabisco where he was responsible for 75 leading brands and a
staff of 4,000.  He also held management positions with Pillsbury.

Mr. Smit has a bachelor of science degree from Duke University,
and a master's degree with focus in international business from
Tufts University's Fletcher School of Law and Diplomacy in
Medford, MA.  He served in the United States Navy as a Navy SEAL,
achieving the rank of Lieutenant Commander.

Commenting on Mr. May, Mr. Allen said, "As we welcome Neil to
Charter, the Board extends our sincere thanks to Bob May, whose
leadership has been vital to Charter over these past eight months
while we conducted this extensive CEO search.  Bob has earned many
times over the respect of both our Board and our employees, and we
look forward to his continued service to our Company as a Board
Member."

"It has been a great privilege to serve Charter as Interim
President and CEO, and to work with the 16,000 finest employees in
the industry," Mr. May said.  "I am very proud that our focus on
disciplined operational improvement and execution is gaining
traction, resulting in positive financial results for two
consecutive quarters this year.  I look forward to helping Neil
during the transition and to returning to my work as an active
member of the Board of Directors."

Charter Communications, Inc. -- http://www.charter.com/-- a    
broadband communications company, provides a full range of  
advanced broadband services to the home, including cable  
television on an advanced digital video programming platform via  
Charter Digital(TM), Charter High-Speed(TM) Internet service and  
Charter Telephone(TM).  Charter Business(TM) provides scalable,  
tailored and cost-effective broadband communications solutions to  
organizations of all sizes through business-to-business Internet,  
data networking, video and music services.  Advertising sales and  
production services are sold under the Charter Media(R) brand.  

At June 30, 2005, Charter Communications' balance sheet showed a  
$5.1 billion stockholders' deficit, compared to a $4.4 billion  
deficit at Dec. 31, 2004.


CHEMED CORP: Reports Second Quarter Operating Results
-----------------------------------------------------
Chemed Corporation (NYSE:CHE) reported financial results for its
second quarter ended June 30, 2005, versus the comparable prior-
year period, as follows:

Consolidated Operating Results from Continuing Operations:

   -- Consolidated Revenue increased 14% to $226 million;

   -- Diluted EPS from Continuing Operations of $.42, including
      $.03 charge for LTIP and other items

   -- Adjusted EBITDA of $29 million

VITAS generated record operating results:

   -- Quarterly Net Patient Revenue of $154 million, up 18%
   -- Average Daily Census (ADC) of 9,913, up 16%
   -- Admissions of 12,646, up 10%
   -- Net income of $10.1 million, up 28%
   -- Adjusted EBITDA of $19.5 million, an increase of 21%

Roto-Rooter segment reported increased Revenue, Net Income and
Adjusted EBITDA:

   -- Revenue of $73 million, an increase of 5%
   -- Net income of $5.7 million, an increase of 10%
   -- Adjusted EBITDA of $11.3 million, an increase of 10%

"VITAS generated excellent census and admissions growth, with
second-quarter ADC totaling 9,913, up 16%, and admissions in the
quarter of 12,646, an increase of 10% over the prior-year quarter.   
Net income in the quarter was $10.1 million, an increase of 28%
over the prior period," stated Kevin McNamara, Chemed president
and chief executive officer.

"Roto-Rooter also reported solid financial operating results.  
For the second quarter of 2005, Roto-Rooter had revenue of
$73 million, an increase of 5%. Adjusted EBITDA was $11.3 million
at a margin of 15.5%, resulting in net income of $5.7 million, an
increase of 10% over the prior year."

                              VITAS

The merger of VITAS was completed on February 24, 2004.  Prior to
that date, the Company accounted for its 37% ownership of VITAS
under the equity method of accounting. As a result, under GAAP,
only a portion of VITAS' operating results is fully consolidated
into Chemed's first-quarter 2004 results.

In the second quarter of 2005, VITAS had net patient revenue of
$154 million and net income of $10.1 million.  Net income includes
after tax costs of $0.4 million for LTIP and $0.2 million for
legal expenses related to the OIG civil investigation.  Adjusted
EBITDA was $19.5 million at a margin of 12.7%.

"VITAS generated revenue growth of 18.0% over the prior-year
period and 5.3% sequentially," stated David Williams, Chemed chief
financial officer.  "Gross margins were 21.4% in the second
quarter of 2005, a 40 basis point decline when compared to the
prior-year quarter.  This decline is primarily the result of our
new start development efforts.  The second-quarter 2005 gross
margin includes $1.4 million in start-up losses, which is
$0.8 million higher than the $0.6 million in losses from programs
classified as new starts in the prior-year period.  Central
support costs for VITAS, which are classified as selling, general
and administrative expenses in the Statement of Operations,
totaled $13.6 million, including $0.3 million in OIG legal
expenses.  Excluding these OIG expenses, central support costs
increased 8.3% when compared to the prior-year quarter and
increased 1.6% sequentially."

VITAS' ADC in the second quarter of 2005 was 9,913.  This compares
to an ADC of 8,581 in the comparable prior-year period, an
increase of 15.5% and 4.1% sequential growth. Admissions totaled
12,646, an increase of 10.2% over the second quarter of 2004. The
Average Length of Stay (ALOS) for patients discharged in the
quarter was 66.8 days and compares to 66.2 days in the first
quarter of 2005 and 60.0 days in the second quarter of 2004.

"VITAS continues to generate strong internal growth," said Mr.
Williams.  "This growth, which excludes 2004 and 2005
acquisitions, generated revenue, ADC and admissions increases of
14.3%, 10.9% and 7.2%, respectively, over the prior-year quarter.

"Our mix of revenue at VITAS was relatively stable," Mr. Williams
added.  "Routine home care represented 69.4% of revenue, an
increase of 110 basis points over the prior-year quarter and a 20
basis point increase on a sequential basis.  Our inpatient revenue
aggregated 13.7% and continuous care was 16.9% of total revenue in
the second quarter of 2005.

"All of our base and new start programs are forecasted to have
Medicare cap cushion for the 2005 measurement period which ends on
October 31, 2005," stated Mr. Williams.  "As previously discussed,
we have been closely monitoring Medicare cap limitations at our
Phoenix acquisition.  Admissions generated by VITAS for Phoenix in
2005 have exceeded the 2004 level.  However, discharges of
patients admitted to the Phoenix hospice program prior to VITAS'
acquisition have been at a slower rate than anticipated.  Based on
these factors, Phoenix is forecasted to have a Medicare cap
liability ranging from $1.0 million to $1.5 million as of
October 31, 2005.  The potential of reaching cap in the initial
year of acquisition was identified during our due diligence of
Phoenix. Since this cap limitation relates to patients admitted
into the program prior to acquisition, the estimated cap accrual
has been accounted for as a contingent liability assumed at
acquisition and is not reflected in the Consolidated Statement of
Income.  VITAS anticipates creating cap cushion in 2006 by
increasing access to shorter stay patients and broadening access
to in-patient and continuous care patients.  This broad mix of
patients is consistent with the clinical model provided by VITAS
in its other programs."

                       Roto-Rooter Segment

Roto-Rooter's plumbing and drain cleaning business generated sales
of $73 million for the second quarter of 2005, 5.3% higher than
the $69 million reported in the comparable prior-year quarter.  
Net income for the quarter was $5.7 million, including
$0.2 million of aftertax costs related to the LTIP.  Adjusted
EBITDA in the second quarter of 2005 totaled $11.3 million, an
increase of 10.0% over the second quarter of 2004.  Adjusted
EBITDA margin in the second quarter of 2005 was 15.5%, a 60 basis
point increase over the prior-year period.

"Job count in the second quarter of 2005 was essentially flat,"
stated Mr. Williams.  "However, commercial plumbing and drain
cleaning job count increased 7.9% and 3.3%, respectively, over the
prior-year quarter.  Residential plumbing jobs increased 1.5% but
were offset by a 4.7% decline in residential drain cleaning jobs
during the quarter.  A commercial job will typically average
approximately 34% more revenue than a residential job.
Accordingly, this continued shift of job mix has a positive impact
on revenue."

                 Consolidated Financial Position

"Our balance sheet is in excellent condition," Mr. Williams
stated.  "As of June 30, 2005, we had $18 million in cash and cash
equivalents.  Net cash provided by continuing operations was
$22 million and capital expenditures totaled $5.3 million in the
second quarter of 2005."

                        Guidance for 2005

"Looking ahead into the second half of 2005," Williams stated, "we
anticipate VITAS to increase revenue in the range of 16% to 18% in
2005, with margins continuing to increase modestly from the 2004
levels.  This operating margin expansion will be generated from
leveraging central support costs.  Roto-Rooter is estimated to
generate a 5% to 6% increase in revenue with margins that
approximate those generated in 2004.  Our consolidated effective
tax rate for the first six months of 2005 was 39%.  This rate
should hold for the remainder of 2005.

"Based upon these factors and a current diluted share count of
26.2 million, our expectation is that full-year 2005 earnings per
diluted share from continuing operations, excluding the early
extinguishment of debt and charges or credits not indicative of
ongoing operations, will be in the range of $1.77 to $1.82."

Chemed Corporation operates in the healthcare field through its
VITAS Healthcare Corporation subsidiary. VITAS provides daily
hospice services to approximately 10,000 patients with severe,
life-limiting illnesses.  This type of care is focused on making
the terminally ill patient's final days as comfortable and pain-
free as possible.

Chemed operates in the residential and commercial plumbing and
drain cleaning industry under the brand name Roto-Rooter.  Roto-
Rooter provides plumbing and drain service through company-owned
branches, independent contractors and franchisees in the United
States and Canada.  Roto-Rooter also has licensed master
franchisees in China/Hong Kong, Indonesia, Singapore, Japan,
Mexico, the Philippines and the United Kingdom.

                         *     *     *

As reported in the Troubled Company Reporter on Jan. 26, 2005,
Moody's Investors Service assigned a Ba2 senior implied rating to
Chemed Corporation's proposed credit facilities, and a Ba3 rating
to the Company's existing senior notes.  Moody's also assigned an
SGL-1 liquidity rating to the Company.  The ratings outlook is
stable. This is the first time Moody's has assigned ratings to
Chemed Corp.

The ratings assigned:

   * $140 Million Senior Secured Revolver maturing 2010 -- Ba2
   * $85 Million Senior Secured Bank Debt maturing 2010 -- Ba2
   * $150 Million 8.75% Senior Notes due 2011 -- Ba3
   * Senior Implied -- Ba2
   * Senior Unsecured Issuer Rating -- Ba3
   * SGL -- 1
   * Outlook -- Stable

As reported in the Troubled Company Reporter on Jan. 26, 2005,
Standard & Poor's Ratings Services raised its ratings on
Cincinnati, Ohio-based hospice, plumbing, and drain cleaning
services provider Chemed Corporation.  The corporate credit rating
was raised to 'BB-' from 'B+', the senior secured debt rating to
'BB' from 'B+', and the senior unsecured debt rating to 'B' from
'B-'.  At the same time, Standard & Poor's assigned a 'BB' rating
and a recovery rating of '1' to Chemed's new senior secured credit
facilities.  These consist of an $85 million senior secured term
loan and a $140 million revolving credit facility, both due in
2010.

Standard & Poor's also revised its outlook on Chemed to stable
from negative.


CITISTEEL USA: S&P Rates Proposed $170 Million Notes at CCC+
------------------------------------------------------------
Standard & Poor's Rating Services assigned its 'B-' corporate
credit rating to Claymont, Delaware-based CitiSteel USA Inc.  In
addition, Standard & Poor's assigned its 'CCC+' senior secured
debt rating to the company's proposed $170 million floating rate
notes due 2010.  The outlook is stable.
     
Proceeds from the proposed notes offering will be used to pay a
$109 million dividend to its very recent equity owner, an
affiliate of H.I.G. Capital, which just acquired CitiSteel USA in
June 2005, and to refinance existing debt.
     
"Although we expect free cash flow to remain adequate over the
next year, given currently favorable custom plate industry
conditions, improvement in the ratings is precluded by the
company's reliance on one primary mill, limited product and
geographic diversity, expectations of industry volatility,
aggressive debt leverage, and relatively limited liquidity," said
Standard & Poor's credit analyst Dominick D'Ascoli.  "Ratings
could be lowered or the outlook revised to negative if the company
experiences lower volumes as a result of operational problems or
weaker demand or if free cash flows turn negative and liquidity
declines meaningfully."
     
CitiSteel is a small producer of steel plate products and faces
substantial competition from much larger, lower-cost rivals as
well as meaningful competition from imports.


COLLINS & AIKMAN: Plastech Offers $1 Billion to Buy Assets
----------------------------------------------------------
Plastech Engineered Products Inc. is offering up to $1 billion to
buy Collins & Aikman's assets, according to a report by Jeffrey
McCracken at the Detroit Free Press.  The transaction has advanced
to the point that Plastech delivered a letter to C&A's Board and
hired Goldman Sachs to raise money to fund the deal, Mr. McCracken
reports.  Plastech says it's ready to begin due diligence and the
final price will be adjusted upward or downward based on what it
finds.  

John Boken, Collins & Aikman's chief restructuring officer,
declined to confirm the $1 billion amount when asked by Jeff
Bennett and Jeff Green at Bloomberg News.  Mr. Boken confirmed
that the Board received Plastech's letter and that "other parties
have expressed interest in the company."  Collins & Aikman
executives have no plans to meet with Plastech executives prior to
Aug. 31, Mr. Boken added.

                        About Plastech

Headquartered in Dearborn, Michigan, Plastech Engineered Products
Inc. -- http://www.plastecheng.com/-- is a privately owned  
designer and manufacturer of primarily plastic automotive
components and systems for OEM and Tier I customers.  These
components and systems incorporate injection-molded plastic parts,
blow-molded plastic parts, and a small percentage of stamped metal
components.  They are used for interior, exterior and under-the-
hood applications.  Plastech employs 7,600 workers.  

In April 2005, Moody's Investors Service downgraded Plastech's
ratings.  Specifically, Moody's:

     -- Downgraded to B1, from Ba3, the ratings for Plastech
        Engineered Products, Inc.'s $465 million ($438 million
        remaining) of guaranteed senior secured first-lien credit
        facilities, consisting of:

     -- $100 million revolving credit facility due March 2009;

     -- $75 million ($60 million remaining) term loan A facility
        due March 2009;

     -- $290 million ($278 million remaining) term loan B facility
        due March 2010;

     -- Downgraded to B2, from B1, the rating for Plastech
        Engineered Products, Inc.'s $50 million guaranteed senior
        secured second-lien term loan facility due March 2011;

     -- Downgraded to B1, from Ba3, the company's senior implied
        rating; and

     -- Downgraded to B3, from B2, the company's senior unsecured
        issuer rating;

Moody's said its rating outlook is negative.

Plastech and its critical customers are being adversely affected
by the challenges currently destabilizing the North American
automotive industry, Moody's noted.  As a result, Moody's
continued, Plastech's leverage, cash flow performance, and
liquidity fell well short of expectations during 2004.
Management's revised estimates regarding prospective results are
also decidedly more conservative.  

Moody's had more to say:

"The rating downgrades reflect that Plastech's 2004 operating
performance and liquidity fell well short of its original plan,
and the company's credit protection measures were negatively
impacted.  Plastech's total debt/EBITDAR leverage (including the
present value of operating leases as debt) rose above 5.0x as of
fiscal year end December 31, 2004.  Cash plus unused effective
availability under Plastech's revolving credit facility notably
declined below $10 million at year end, but management indicates
that this liquidity amount has since improved to about $40
million.  The company also had to obtain waivers of several fiscal
year end financial covenant violations under the credit agreement.

"The deterioration of Plastech's operating results was evident
despite the fact that the company's February 2004 acquisition of
LDM Technologies appears to have been a good business fit, has
been fully integrated into Plastech's operations, and is already
generating the $25 million of budgeted annualized synergies.  
Offsetting these benefits were a series of negative industry
pressures that were out of management's ability to control.  
Plastech is heavily concentrated with the Big 3 domestic OEM's in
the North American market and is therefore vulnerable to lowered
production volumes and market shares, as well as delayed program
launches.  In addition, Plastech was pressured by its customers to
agree to a significantly higher percentage of non-contractual
pricedowns in an effort to maintain customer relationships and
solidify its future book of business. Certain annual sales levels
to Johnson Controls, Inc. per the terms of the Plastics Component
Sourcing Agreement with Plastech are also lower than anticipated.  
JCI's ability to meet the minimum sales levels for 2005 and
forward under the agreement is uncertain. As a purchaser of high
volumes of plastic, Plastech is also heavily exposed to rising
prices for oil derivatives.

"The negative rating outlook centers on Moody's concerns regarding
the potential duration of the current confluence of unfavorable
industry conditions, expectations for ongoing customer price
compression, uncertainty regarding JCI's ability to meet its
previously anticipated volume levels under the critical PCSA
contract, and the potential impact of rising oil prices on both
the cost of oil derivatives as well as the ongoing popularity of
high-content SUV's with consumers.

"The rating downgrades affecting Plastech were confined to one
notch based upon the fact that LTM and prospective EBIT interest
coverage remain satisfactory at about 2.0x or better, the
acquisition of LDM appears to have been accretive, and the
existence of an automatic hedge within the PCSA agreement with JCI
related to the level of 2005 productivity giveback payments to be
made by Plastech .  In addition, during April 2005 Plastech
executed an amendment to the credit agreement resetting all
financial covenants based upon the company's revised base case
plan.  On that basis, Plastech should have full access to its
revolving credit facility over the near-to-intermediate term
without risk of violating covenants.  Plastech additionally
received $22 million of gross proceeds during the first quarter of
2005 related to the sale of a minority joint venture interest in
Singapore.  Several unusual commercial uses of cash aggregating
more than $15 million and an approximately $10 million pre-buy of
resin inventory in anticipation of commodity price increases are
in the process of reversing.  Plastech is also making use of its
natural recession hedge by bringing certain "extended enterprise"
outsourced production back in-house and thereby improving capacity
utilization and margin performance for that business.

"Future events that would likely result in additional ratings
downgrades include the inability of Plastech to stabilize unused
liquidity near $50 million, a material acquisition, persistently
high customer pricedowns, continued increases in raw materials
prices which are not offset by customers, further declines in
production levels, or significant volume shortfalls under the PCSA
agreement.

"Future events that could result in an improved outlook and
eventual rating upgrades could include additional enhancements to
improve average unused liquidity to $75 million or more, a
positive result to ongoing discussions with JCI regarding ways to
enable JCI to meet previously anticipated sales levels or to
otherwise find a mutually agreeable solution to the sales
shortfall situation, stabilizing commodity prices, additional new
business awards with solid margins, and geographic diversification
of the customer base."

                    About Collins & Aikman

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.


CONGOLEUM CORP: Confirmation Hearing Set for December 13
--------------------------------------------------------
The U.S. Bankruptcy Court for the District of New Jersey approved
the adequacy of the information contained in the Modified
Disclosure Statement explaining the Modified Joint Plan of
Reorganization filed by Congoleum Corporation and its debtor-
affiliates on July 26, 2005.  

The Court is satisfied that the Disclosure Statement contains the
right amount of the right kind of information that would enable a
hypothetical investor to make an informed judgment about the Plan.

                    About the Modified Plan

The Modified Plan contemplates the creation of a Plan Trust under
11 U.S.C. Sec. 524(g) to satisfy and pay asbestos-related personal
injury claims.  The Trust is intended to be a qualified settlement
fund within the meaning of Section 1.468B - 1(a) of the Treasury
Regulations promulgated under Section 468B of the IRC.  The Plan
Trust will assume the liabilities of the Debtors with respect to
all Plan Trust Asbestos Claims and will use Plan Trust Assets and
income to pay Plan Trust Asbestos Claims as provided in the Plan
and the Plan Trust Documents.

The Plan Trust will be funded with the Plan Trust Assets, which
will include the Promissory Note issued by Congoleum and payable
to the Plan Trust, in the initial aggregate original principal
amount of $2,738,234.75, which represents 51% of the market
capitalization of Congoleum as of June 6, 2003.

That original principal amount will be subject to an increase, if
any, in an amount equal to 51% of Congoleum's market
capitalization, based on the average trading prices at the close
of trading for the 90 consecutive trading days beginning on the
one year anniversary of the Plan's Effective Date.

              Treatment of Claims and Interests

The Modified Plan provides for payment in full of Allowed
Administrative Claims, Allowed Priority Tax Claims, Allowed
Priority Claims, Allowed General Unsecured Claims and the
establishment of the Plan Trust to satisfy Plan Trust Asbestos
Claims.

Lender Secured Claims, Other Secured Claims and Senior Note Claims
are not impaired or affected by the Plan.  The Plan will be
binding on all parties holding Claims, whether asserted or not
against Congoleum Corporation.

General Unsecured Claims constitute Claims against the Debtors
other than Asbestos Claims, Senior Note Claims, ABI Claims and
Workers Compensation Claims, including Claims with respect to
rent, trade payables and other similar Claims.  The legal,
equitable and contractual rights of the holders of Allowed General
Unsecured Claims are unimpaired by the Plan and all those Claims
will be reinstated on the Effective Date.

Previously Determined Unsecured Asbestos Personal Injury Claims
are impaired under the Plan.  On the Effective Date, all liability
for all those Claims will be automatically assumed, and without
further act or deed, by the Plan Trust and the Reorganized
Debtors, who will have no more liability to those Claims Holders
after their claims are assumed.

Each Allowed Previously Determined Unsecured Asbestos Personal
Injury Claim will be paid pursuant to the Plan Trust Agreement and
the TDP and in all respects pari passu with the Allowed Secured
Asbestos Claims in Classes 2 and 3 and the Not Previously
Determined Unsecured Asbestos Personal Injury Claims in Class 10.
The TDP will apply to all holders of Previously Determined
Unsecured Asbestos Personal Injury Claims.

Full-text copies of the Modified Disclosure Statement and Fifth
Modified Plan are available for a fee at:

  http://www.researcharchives.com/bin/download?id=050615032425

Headquartered in Mercerville, New Jersey, Congoleum Corporation --
http://www.congoleum.com/-- manufactures and sells resilient  
sheet and tile floor covering products with a wide variety of
product features, designs and colors.  The Company filed for
chapter 11 protection on December 31, 2003 (Bankr. N.J. Case No.
03-51524) as a means to resolve claims asserted against it related
to the use of asbestos in its products decades ago. Domenic
Pacitti, Esq., at Saul Ewing, LLP, represents the Debtors in their
restructuring efforts.  When the Company filed for protection from
its creditors, it listed $187,126,000 in total assets and
$205,940,000 in total debts.   At June 30, 2005, Congoleum Corp.'s
balance sheet showed a $35,939,000 stockholders' deficit, compared
to a $20,989,000 deficit at Dec. 31, 2004.  Congoleum is a 55%
owned subsidiary of American Biltrite Inc. (AMEX:ABL).  


CONGOLEUM CORP: June 30 Balance Sheet Upside-Down by $35.9 Million
------------------------------------------------------------------
Congoleum Corporation (AMEX:CGM) reported its financial results
for the second quarter ended June 30, 2005.

Sales for the three months ended June 30, 2005 were $58.1 million,
compared with sales of $63.0 million reported in the second
quarter of 2004, a decrease of 7.7%.  The net loss for the second
quarter of 2005 was $14.6 million, which included a $15.5 million
charge for asbestos liabilities, compared with net income of
$1.4 million in the second quarter of 2004.

Sales for the six months ended June 30, 2005 were $115.7 million,
compared with sales of $115.0 million reported in the first six
months of 2004, an increase of 0.6%.  The net loss for the six
months ended June 30, 2005 (after the asbestos related charge of
$15.5 million) was $15.0 million, versus net income of $900,000 in
the first six months of 2004.

"We would have had a slight profit in the quarter were it not for
the asbestos charge," Roger S. Marcus, Chairman of the Board,
said.  "While our operating results trailed the second quarter of
last year, I consider them satisfactory in light of the challenges
we faced.  The most significant of these was that as part of a
broader reduction initiative, our largest distributor reduced it's
inventory of our products by $4.4 million, which negatively
affected our gross profit in the quarter by over $1 million."

"Another factor that negatively impacted our operating performance
this past quarter was the raw material situation.  While raw
material costs appear to have peaked, our price increases have yet
to offset the cumulative impact of the inflation we have
experienced.  In addition, our plant efficiencies were hurt by the
need to test and qualify new raw material sources."

Mr. Marcus continued, "The good news is that the worst of the raw
material situation appears to be behind us.  We are hopeful that
material prices may even soften during the balance of the year, at
least partially closing the gap between our cost increases and
what we have been able to pass along in pricing.  We believe we've
resolved the formulation difficulties with our new materials,
which should help our manufacturing performance."

"On the sales side, our DuraCeramic product continues to sell well
and we are optimistic about its continued growth.  In addition,
the manufactured housing market has shown some signs of
improvement. We also remain focused on controlling operating
expenses."

Mr. Marcus concluded, "On the reorganization front, we've recently
filed a new plan with the court and the related disclosure
statement was approved July 28, 2005.  We will begin soliciting
acceptances of the latest plan shortly and a confirmation hearing
is scheduled for Dec. 13.  As this quarter's charge indicates,
these proceedings are painfully expensive and we are striving to
get through them as rapidly as possible."

Headquartered in Mercerville, New Jersey, Congoleum Corporation --
http://www.congoleum.com/-- manufactures and sells resilient  
sheet and tile floor covering products with a wide variety of
product features, designs and colors.  The Company filed for
chapter 11 protection on December 31, 2003 (Bankr. N.J. Case No.
03-51524) as a means to resolve claims asserted against it related
to the use of asbestos in its products decades ago. Domenic
Pacitti, Esq., at Saul Ewing, LLP, represents the Debtors in their
restructuring efforts.  When the Company filed for protection from
its creditors, it listed $187,126,000 in total assets and
$205,940,000 in total debts.   At June 30, 2005, Congoleum Corp.'s
balance sheet showed a $35,939,000 stockholders' deficit, compared
to a $20,989,000 deficit at Dec. 31, 2004.  Congoleum is a 55%
owned subsidiary of American Biltrite Inc. (AMEX:ABL).  


CONSECO INC: Completes Offering of 3.50% Convertible Debentures
---------------------------------------------------------------
Conseco, Inc. (NYSE: CNO) said that it has priced its $300 million
private offering of 3.50% Convertible Debentures due September 30,
2035.  The debentures were offered only to qualified institutional
buyers under Rule 144A of the Securities Act of 1933, as amended.
The Company has granted the initial purchasers a 13-day option to
purchase up to an additional $30 million principal amount of
debentures.

The Company intends to use proceeds from the offering to repay
term loans currently outstanding under its senior credit facility.
The offering is expected to close on August 15, 2005, subject to
certain closing conditions.

The debentures will bear interest at a rate of 3.50% per year,
payable semi-annually, beginning on March 31, 2006 and ending on
September 30, 2010. Thereafter, the principal amount of the
debentures will accrete at a rate that provides holders with an
aggregate yield to maturity of 3.50%, computed on a semi-annual,
bond-equivalent basis.

The debentures will be convertible at the option of the holders,
upon the occurrence of certain specified events, into cash or,
under certain circumstances, cash and shares of the Company's
common stock at an initial conversion price of approximately
$26.66 per share.  The initial conversion price represents a
premium of 27.5% over today's closing price of the Company's
common shares.

On or after October 5, 2010, the Company may redeem for cash all
of a portion of the debentures at any time at a redemption price
equal to 100% of the accreted principal amount of the debentures
plus accrued and unpaid interest, if any, to the redemption date.
Holders may require the Company to repurchase in cash all or any
portion of the debentures on September 30, 2010, 2015, 2020, 2025
and 2030 at a repurchase price equal to 100% of the accreted
principal amount of the debentures to be repurchased, plus accrued
and unpaid interest, if any, to the applicable repurchase date.

Holders of the debentures may convert their debentures only if:

    (1) the price of the Company's common stock reaches a
        specified threshold,

    (2) the trading price for the debentures falls below a
        specified threshold,

    (3) the debentures have been called for redemption, or

    (4) specified corporate transactions occur.

The debentures and the common shares issuable upon conversion
thereof have not been registered under the Securities Act of 1933
or any state securities laws, and may not be offered or sold in
the United States absent registration or an applicable exemption
from registration requirements.

This press release shall not constitute an offer to sell or the
solicitation of an offer to buy any of the debentures to be
offered, nor shall there be any sale of debentures in any state in
which such offer, solicitation or sale would be unlawful.

Conseco, Inc.'s insurance companies help protect working American
families and seniors from financial adversity: Medicare
supplement, long-term care, cancer, heart/stroke and accident
policies protect people against major unplanned expenses;
annuities and life insurance products help people plan for their
financial futures.  The Company can be accessed on the World Wide  
Web at http://www.conseco.com/  

                        *     *     *

As reported in the Troubled Company Reporter on Aug. 4, 2005,  
Standard & Poor's Ratings Services revised its outlook on Conseco
Inc.'s core operating companies to positive from stable.  The
outlook on Conseco Inc. and Conseco Senior Health Insurance Co.,
which is a nonstrategic member of the group, remains stable.  

Standard & Poor's also said that it assigned its 'BB-' rating to   
Conseco Inc.'s upcoming $300 million convertible senior notes
issue.  Proceeds from the new senior debt issue will be used to
pay down the existing $767 million bank credit facility.  

In addition, Standard & Poor's affirmed its 'BB+' counterparty
credit and financial strength ratings on Conseco Inc.'s core
operating companies, its 'CCC' counterparty credit and financial
strength ratings on CSH, and its 'BB-' counterparty credit rating
on Conseco Inc.

As reported in the Troubled Company Reporter on Aug. 2, 2005,
Moody's Investors Service placed the ratings on the bank debt and
mandatory convertible preferred securities of Conseco, Inc.  
(Conseco, B2 bank debt rating) as well as the Ba1 insurance
financial strength ratings of Conseco, Inc.'s insurance
subsidiaries on review for possible upgrade.  Conseco Senior  
Health Insurance Company was affirmed at Caa1 with a developing
outlook.


DENBURY RESOURCES: Reports 2nd Qtr. Financial & Operating Results
-----------------------------------------------------------------
Denbury Resources Inc. (NYSE symbol: DNR) reported its second
quarter 2005 financial and operating results.  

The Company's production in the second quarter of 2005 increased
3% over first quarter of 2005 production, averaging 30,469 barrels
of oil equivalent per day -- BOE/d.  The Company also posted near-
record earnings for the quarter of $40.7 million, as compared to
earnings of $19.4 million, for the second quarter of 2004.
Included in second quarter 2005 net income is approximately
$2.8 million of pre-tax non-cash income ($1.9 million after tax)
related to the Company's decision to discontinue hedge accounting
as of January 1, 2005.  This income includes the resultant income
from mark-to-market adjustments of its oil and natural gas
derivative contracts, offset in part by the amortization of
deferred hedge mark-to-market value losses that existed as of
December 31, 2004 which are being amortized as the contracts
expire in 2005.

Adjusted cash flow from operations (cash flow from operations
before changes in assets and liabilities, a non-GAAP measure)
for the second quarter of 2005 was $82.0 million, a 30% increase
over second quarter 2004 adjusted cash flow from operations of
$63.1 million.  Net cash flow provided by operations, the GAAP
measure, totaled $88.4 million during the second quarter of 2005,
as compared to $53.2 million during the second quarter of 2004.   
The difference between the adjusted cash flow and cash flow from
operations is due to the changes in receivables, accounts payables
and accrued liabilities during the quarter.

                           Production

Production for the quarter was 30,469 BOE/d, a 3% increase over
the first quarter of 2005 average of 29,724 BOE/d and an 11%
increase over second quarter of 2004 levels, after adjustment for
the offshore properties sold in July 2004.  Oil production from
the Company's tertiary operations increased 9% over first quarter
2005 levels, and 43% when compared to second quarter 2004 tertiary
oil production, averaging 9,417 Bbls/d in 2005's second quarter as
a result of production increases at Little Creek, Mallalieu and
McComb Fields.  Natural gas production from the Barnett Shale
increased to 2,052 BOE/d in the second quarter of 2005, up from
345 BOE/d for the second quarter of 2004.  Higher production from
tertiary operations and from the Barnett Shale were partially
offset by declines in production from the Company's onshore
Louisiana properties, which decreased from 7,492 BOE/d in the
second quarter of 2004 to 5,791 BOE/d in the second quarter of
2005, with the majority of the decrease from Thornwell and Lirette
Fields.

              Second Quarter 2005 Financial Results

Oil and natural gas revenues, excluding hedges, were up 6% between
the respective second quarters, as higher commodity prices more
than offset lower production levels resulting from the July 2004
sale of offshore properties.  Cash payments on hedges were $1.8
million in the second quarter of 2005, a significant decrease from
the $18.2 million paid in the second quarter of 2004, as most of
the Company's out-of-the-money hedges expired as of Dec. 31, 2004.  
In addition to the cash payments, the Company recognized income of
$2.8 million of mark-to-market and other adjustments in the second
quarter of 2005 relating to the Company's decision to discontinue
hedge accounting as of January 1, 2005.  As a result of this
accounting change, all future changes in the fair values of the
Company's oil and natural gas derivative instruments will result
in income or expense in the Company's statement of operations.

Oil price differentials (Denbury's net oil price received as
compared to NYMEX prices) deteriorated during 2004, particularly
in the last quarter, as the price of heavy, sour crude produced
primarily in the Company's East Mississippi properties dropped
significantly relative to NYMEX prices.  These differentials did
not change significantly during the first quarter of 2005, but
improved 13% during the second quarter.  The Company's average
NYMEX differential increased from $3.93 per Bbl during the second
quarter of 2004 (the lowest quarterly average during 2004) to
$6.54 per Bbl during the first quarter of 2005, but decreased to a
$5.72 per Bbl differential during the second quarter of 2005, an
$0.82 per Bbl increase in the price the Company received relative
to NYMEX prices between the first and second quarters of 2005.

Lease operating expenses increased in the second quarter of 2005
on both an absolute and per BOE basis.  On a per BOE basis,
operating expenses increased 31%, from $7.36 per BOE in the second
quarter of 2004 to $9.65 per BOE in the second quarter of 2005.   
These per BOE expenses compare to an average of $8.58 per BOE
incurred in the first quarter of 2005.  The single biggest reason
for the increase relates to the increasing emphasis on tertiary
operations, for which operating expenses averaged $9.90 per BOE
during 2004 and $11.04 per BOE during the second quarter of 2005,
higher than the operating costs for the Company's other
operations.  Workover expenses were also higher in the second
quarter of 2005 than in the comparable period of 2004.  Adjusted
for the properties sold in the offshore sale, the workover
expenses were approximately $2.0 million higher in the 2005
period, primarily related to a mechanical failure on one onshore
Louisiana well.  The balance of the cost increases is generally
attributable to higher energy costs to operate Company properties
and general cost inflation in the industry.

Production taxes and marketing expenses generally change in
proportion to commodity prices and therefore were higher in the
second quarter of 2005 than in the comparable quarter of 2004.   
The July 2004 sale of the Company's offshore properties also
contributed to an increase in production taxes and marketing
expenses on a per BOE basis during 2005, as most of its offshore
properties were tax exempt.

General and administrative expenses increased 43% between the two
second quarter periods, averaging $2.16 per BOE in the second
quarter of 2005, up from $1.25 per BOE in the prior year's second
quarter.  Most of the increase is attributable to incremental
consultant fees, primarily related to compliance costs associated
with, or audit work related to, the Sarbanes-Oxley Act,
incremental costs to document, test and maintain the new software
system that the Company began using in January 2005, and
approximately $1.0 million of non-cash compensation resulting from
the issuance of restricted stock during 2004.

Interest expense decreased 14% as a result of lower overall debt
levels following the sale of the Company's offshore properties in
July 2004, the proceeds of which were used to retire the Company's
bank debt, and as a result of approximately $373,000 of interest
expense that was capitalized during the second quarter of 2005
relating to the CO2 pipeline being constructed to East
Mississippi.

For the second quarter of 2005, depreciation, depletion and
amortization expense increased to $8.80 per BOE, as compared to
the Company's first quarter 2005 DD&A rate of $8.05, primarily due
to rising costs, high acquisition costs per BOE and increased
spending.  The Company has not recognized any incremental reserves
related to its tertiary program to date during 2005.

The Company recognized current income tax expense of $4.4 million
in the second quarter of 2005 related to anticipated alternative
minimum taxes due that will not be offset by the Company's
enhanced oil recovery credits.

                          2005 Outlook

Denbury's 2005 development and exploration budget (excluding
acquisitions) is currently set at $350 million, including the
estimated costs of the CO2 pipeline being constructed to East
Mississippi.  As a result of the cost inflation in the industry,
it is likely that the Company will have to either further increase
its capital budget during the year or eliminate a portion of its
projects.  Any acquisitions made by the Company will increase
these capital budget amounts.  Denbury's total debt as of
July 31, 2005, was approximately $245 million, including
$20 million borrowed on its bank credit line, with $180 million
undrawn on its bank borrowing base.

The Company reaffirms its production guidance for 2005 of 31,000
BOE/d, which represents organic growth of over 10% from its
average 2004 production levels, after adjusting for the July 2004
offshore sale.  As a result of operational delays, the Company is
revising its forecasted production from its tertiary oil projects
from a prior estimate of 10,000 BOE/d to a revised estimated range
between 9,500 to 9,750 BOE/d.

Gareth Roberts, Chief Executive Officer, said: "Our core
operations, the CO2 tertiary floods, are continuing to perform as
expected.  This week we started construction on our CO2 pipeline
to East Mississippi and if things go as planned, the line could be
ready by early 2006, ahead of our mid-2006 target date.  
Production from our tertiary floods is responding as expected;
however, due to operational delays, we slightly reduced our
forecasted tertiary production for 2005, although the revised
forecast still represents a 42% increase over 2004 levels.  We are
currently drilling another CO2 source well, which if successful,
could provide significant incremental CO2 reserves for a potential
future phase of the program."

"In the Barnett Shale, production is continuing to increase as a
result of our drilling and acquisition activity.  We currently
have three rigs running in this area and will add a fourth in the
fourth quarter.  Year to date, we have spent almost $70 million on
acquisitions, about one-half related to the Barnett Shale area and
about one-half directed at either incremental interests in
existing oil fields or interests in new fields that are potential
future flood candidates for our tertiary operations.  While we are
experiencing significant cost inflation in our industry, at
current commodity prices, we expect to continue to generate record
or near-record cash flow and earnings.  Our future continues to
look bright."

Denbury Resources, Inc. -- http://www.denbury.com/-- is a growing   
independent oil and gas company.  The Company is the largest oil
and natural gas operator in Mississippi, owns the largest reserves
of CO2 used for tertiary oil recovery east of the Mississippi
River, and holds key operating acreage in the onshore Louisiana
and Texas Barnett Shale areas.  The Company increases the value of
acquired properties in its core areas through a combination of
exploitation drilling and proven engineering extraction practices.

                         *     *     *

As reported in the Troubled Company Reporter on Mar. 15, 2004,
Standard & Poor's Ratings Services affirms its 'BB-' corporate
credit rating on Denbury Resources, Inc., and revised its outlook
on the company to positive from stable.


DP 8 LLC: Court OKs Vanderbilt Farm's Amended Disclosure Statement
------------------------------------------------------------------
The Honorable George B. Nielsen of the U.S. Bankruptcy Court for
the District of Arizona, Phoenix Division, approved the Amended
Disclosure Statement explaining the Amended Plan of Reorganization
filed by Vanderbilt Farms, LLC, a creditor in DP 8 LLC's chapter
11 case.

Vanderbilt Farms can now ask creditors to vote to accept its
Amended Plan of Reorganization.  Creditors' ballots must be
returned by Aug. 25, 2005.  The Bankruptcy Court will convene a
hearing to consider plan confirmation at 9:00 a.m. on Sept. 1,
2005.

                 Amended Plan of Reorganization

As previously reported in the Troubled Company Reporter on June 8,
2005, Vanderbilt Farms' Plan proposes to:

    a) resolve all disputes among the LLC members and restructure
       DP 8's management;

    b) determine its profit share claim in the Meridian property;
       and

    c) provide other members not wishing to remain in
       reorganized DP 8 a chance to sell their interests at a
       fair price.

The Plan groups claims and interests into six classes. The first
four classes, composed of administrative expenses; claims secured
by liens on the real property; claims of the owners of property
adjacent to the real Property, on which the Debtor and its co-
tenants hold repurchase options; and claims not holding security
or entitled to priority, will be paid in full, in cash, on the
effective date of the Plan.

Vanderbilt Farms' unsecured claim shall be satisfied by an
unsecured promissory note from DP 8, bearing below-market interest
at 4%.  The note will mature two years after plan confirmation or
the sale of the property.

Holders of DP 8 membership interests can choose to receive a cash
payment from Vanderbilt in exchange for their existing membership
rights and interests.  Withdrawing Members will no longer be
members of DP 8, but will retain ownership of their respective
economic interest until full payment is made.

The Plan will be funded from the Debtor's cash on hand.
Vanderbilt Farms will also advance any additional cash needed to
make the payments.

Lawrence C. Wright, Esq., at Wright & Associates and Lee Allen
Johnson, Esq., at Lee Allen Johnson, P.C., represent Vanderbilt
Farms, LLC.

Headquartered in Mesa, Arizona, DP 8 L.L.C., a real estate
developer, filed for chapter 11 protection on July 30, 2004
(Bankr. Ariz. Case No. 04-13428).  Dale C. Schian, Esq., at Schian
Walker PLC, represents the Debtor in its restructuring efforts.
When the Debtor filed for protection, it listed $13,626,000 in
total assets and $3,663,678 in total debts.


DRUG ASSIST: Voluntary Chapter 11 Case Summary
----------------------------------------------
Debtor: Drug Assist Health Solutions, Inc.
        dba Shopper's Drug
        26 Fort Pleasant Avenue
        Springfield, Massachusetts 01108

Bankruptcy Case No.: 05-45397

Type of Business: The Debtor operates a pharmacy. See
                  http://www.edrugassist.com/

Chapter 11 Petition Date: August 10, 2005

Court: District of Massachusetts (Worcester)

Judge: Henry J. Boroff

Debtor's Counsel: George I. Roumeliotis, Esq.
                  Hendel & Collins, P.C.
                  101 State Street, 5th Floow
                  Springfield, Massachusetts 01103-2006
                  Tel: (413) 734-6411

Estimated Assets: Less than $50,000

Estimated Debts:  $1 Million to $10 Million

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


E*TRADE FINANCIAL: Buying BMO Financial's Harrisdirect for $700MM
-----------------------------------------------------------------
BMO Financial Group (TSX, NYSE: BMO) signed a definitive agreement
to sell Harrisdirect to E*Trade Financial Corp. for a purchase
price of $700 million, payable in cash.  In addition, at closing,
Harrisdirect will distribute approximately $50 million to BMO
Financial Group, resulting in aggregate proceeds of approximately
$750 million (CDN$910 million).  The transaction, which is subject
to normal regulatory clearances, is expected to close by BMO's
fiscal year-end in October 2005.

Upon completion of the transaction, BMO anticipates recognizing a
modest gain, the amount of which will be dependent upon a number
of adjustments that are expected to be finalized upon closing.

On a go-forward basis, it is anticipated that this transaction
will increase the Tier 1 Capital Ratio by approximately 35 basis
points.  This transaction is not expected to have a significant
impact on earnings per share.

"This transaction is a win; it will benefit both our clients and
our shareholders," said Tony Comper, President and Chief Executive
Officer, BMO Financial Group.  "Harrisdirect clients have
benefited from innovative solutions and award-winning customer
service that has distinguished the Harrisdirect brand.  Under the
E*Trade Financial banner, they will benefit from an expanded
breadth of product capabilities and product enhancements that
E*Trade Financial will provide, given its significant scale and
market presence.

"BMO remains fully committed to continuing to expand its
operations in the United States," stated Mr. Comper.  "For BMO,
this transaction increases value to our shareholders and will
allow us to redeploy capital to higher-return businesses and to
concentrate our attention on our goal of becoming the leading
personal and commercial bank in the U.S. Midwest," he stated.

"The decision to sell Harrisdirect followed an assessment of
Harrisdirect's ability to compete in a changing landscape.  Given
the additional amount of capital that would have been required to
grow the business and remain competitive in the current
environment of consolidation, we concluded that Harrisdirect would
be more valuable to another participant in the online brokerage
industry," said Mr. Comper.

Harrisdirect has approximately 430,000 active accounts and US$32
billion in assets under administration.  The business provides
online brokerage services to individual investors as well as
third-party brokerage services to institutional clients.

"Combining the best solutions from Harrisdirect and E*Trade
Financial will create highly competitive, value-added products and
services for customers," said Mitchell Caplan, E*Trade Financial
Chief Executive Officer.   "The addition of Harrisdirect's world
class customer service skills will strengthen our competitive
position in the marketplace, delivering increased shareholder
value."

"Wealth management will continue to be an integral part of our
overall Personal and Commercial-led U.S. strategy," stated Bill
Downe, Deputy Chair, BMO Financial Group, and Chief Executive
Officer, BMO Nesbitt Burns.  "We offer a broad range of high-
quality wealth management solutions to our retail and commercial
clients, with professional advisors co-located and working on
integrated teams with our private banking and retail banking
clients," he said.

"Harris Private Bank has an excellent reputation, strong brand
recognition and an attractive customer base," said Mr. Downe.  
"Wealth management is a profitable, high-growth industry and we
believe we are well-positioned to participate in this growth."

He also confirmed that BMO will continue to operate its award-
winning Canadian online broker, BMO InvestorLine, which is a
separate company that is not affected by this transaction.

Established in 1817 as Bank of Montreal, BMO Financial Group is a
highly diversified North American financial services organization.  
With total assets of CDN$292 billion as at April 30, 2005, and
more than 33,000 employees, BMO provides a broad range of retail
banking, wealth management and investment banking products and
solutions.  BMO Financial Group serves clients across Canada
through its Canadian retail arm, BMO Bank of Montreal, and through
BMO Nesbitt Burns, one of Canada's leading full-service investment
firms.  In the United States, BMO serves clients through Chicago-
based Harris, an integrated financial services organization that
provides more than 1.5 million personal, business, corporate and
institutional clients with banking, lending, investing, financial
planning, trust administration, portfolio management, family
office and wealth transfer services.

The E*Trade Financial family of companies provide financial
services including trading, investing, banking and lending for
retail and institutional customers.  Securities products and
services are offered by E(x)TRADE Securities LLC (Member
NASD/SIPC). Bank and lending products and services are offered by
E(x)TRADE Bank, a Federal savings bank, Member FDIC, or its
subsidiaries.

                        *     *     *

As reported in the Troubled Company Reporter on Aug. 10, 2005,
Moody's Investors Service affirmed all outstanding ratings of  
E*Trade Financial Corporation ("E*Trade"; long-term senior debt at  
B1) and its lead bank subsidiary, E*Trade Bank (long-term deposits  
at Ba2; other senior obligations at Ba3).  The rating outlooks  
remain stable.

In addition, Standard & Poor's Ratings Services changed its
outlook on E*TRADE Financial Corp. to stable from positive.  At
the same time, Standard & Poor's affirmed its 'B+' long-term
counterparty credit rating on E*TRADE Financial Corp and its
'BB/Stable/B' counterparty credit rating on E*TRADE Bank.
       
"The outlook change reflects E*TRADE's increased financial  
leverage and decreased liquidity as a result of the company's  
announced acquisition of Harrisdirect for $700 million," said  
Standard & Poor's credit analyst Helene De Luca.


EASYLINK SERVICES: Issues 425K Shares in QuickStream Acquisition
----------------------------------------------------------------
EasyLink Services Corporation issued an aggregate of 425,000
shares in connection with the acquisition of Quickstream
Software, Inc., on August 1, 2005.  A portion of the shares were
issued to certain stockholders and holders of debt and other
obligations of Quickstream pursuant to the exemption under Section
4(2) of the Securities Act of 1933, as amended, and Regulation D,
and the balance of the shares were granted to employees of
Quickstream in a transaction not subject to the registration
requirements of the Securities Act.

EasyLink Services Corporation (NASDAQ: EASY) --  
http://www.EasyLink.com/-- headquartered in Piscataway, New    
Jersey, is a leading global provider of services that power the  
exchange of information between enterprises, their trading  
communities, and their customers.  EasyLink's global network  
handles over 1 million transactions every business day on behalf  
of over 60 of the Fortune 100 and thousands of other companies  
worldwide.  The Company facilitate transactions that are integral  
to the movement of money, materials, products, and people in the  
global economy, such as insurance claims, trade and travel  
confirmations, purchase orders, invoices, shipping notices and  
funds transfers, among many others.  EasyLink helps companies  
become more competitive by providing the most secure, efficient,  
reliable, and flexible means of conducting business  
electronically.  

                     Going Concern Doubt   

KPMG LLP expressed substantial doubt about EasyLink's ability to  
continue as a going concern after it audited the Company's  
financial statements for the fiscal year ended Dec. 31, 2004.
The Company said it again received that going concern  
qualification notwithstanding the significant improvements in its  
financial condition and results of operations over the past three  
years.  The auditors point to the Company's working capital  
deficiency and an accumulated deficit.  The Company also received  
qualified opinions from its auditors in 2000, 2001, 2002 and 2003.

                  Second Quarter 2005 Filing

The Company intends to release its second quarter 2005 results  
after the market closes on Monday, August 15, and hold a  
conference call to discuss those results the following day.  This  
release is slightly delayed from EasyLink's standard schedule in  
order to give Grant Thornton adequate time to initiate its  
engagement with EasyLink and to complete its review of EasyLink's  
second quarter results.  Due to the timing of the engagement of  
Grant Thornton, however, it may be necessary to further delay the  
release for a short period of time after Aug. 15, 2005, to allow  
Grant Thornton to complete their review.


EXTENDICARE INC: Earns $25.2 Mil. of Net Income in Second Quarter
-----------------------------------------------------------------
Extendicare Inc. (TSX:EXE.MV) and (TSX:EXE.SV); (NYSE:EXE)
released its financial results for the second quarter of 2005.

Extendicare reported 2005 second quarter net earnings of
$25.2 million compared to $18.3 million in the 2004 second
quarter.  Earnings from health care operations prior to the
undernoted items rose to $28.0 million compared to $21.7 million
in the 2004 second quarter.

The following table outlines the components of the Company's net
earnings for the second quarter periods ended June 30, 2005 and
2004.

                                         Three months ended June 30
   --------------------------------------------------------------------
   Components of Earnings (Loss) (1)       2005              2004
   --------------------------------------------------------------------
                                      After-  Diluted   After-  Diluted
                                       tax    EPS (2)    tax    EPS (2)
   --------------------------------------------------------------------
   (thousands of Canadian dollars except per share amounts)
   Health care operations before
    undernoted (1)                    27,989   $0.40    21,688   $0.31
   Valuation adjustment on interest
    rate caps                           (708)  (0.01)   (3,661)  (0.05)
   Gain(loss) from asset disposals,
    impairment and other items        (3,721)  (0.05)     (269)  (0.01)
   --------------------------------------------------------------------
                                      23,560   $0.34    17,758   $0.25
   Share of equity accounted earnings  1,683    0.02       584    0.01
   --------------------------------------------------------------------
   Net earnings                       25,243   $0.36    18,342   $0.26
   --------------------------------------------------------------------
   (1) Refer to discussion of non-GAAP measures.
   (2) Diluted earnings per common share prior to the Subordinate
       Voting Share preferential dividend.
   --------------------------------------------------------------------
   Diluted Earnings per Share(3)               Q2/05             Q2/04
   --------------------------------------------------------------------
   Subordinate Voting Share                    $0.37             $0.26
   Multiple Voting Share                       $0.34             $0.26
   --------------------------------------------------------------------
   (3) After giving effect to the Subordinate Voting Share preferential
       dividend of $0.025 in Q2/05, and nil in Q2/04.
   --------------------------------------------------------------------

"Extendicare's U.S. operations continue to reach new heights,
largely driven by the successful deployment of our sales-based
model," said Mel Rhinelander, Extendicare Inc.'s President and
Chief Executive Officer.  "In addition, the Assisted Living
Concepts acquisition is continuing to perform ahead of our
expectations and, we believe it will solidify our position as a
significant player in the assisted living component of senior
care."

Extendicare Health Services, Inc.'s average daily Medicare patient
census on a same-facility basis rose 16.4% to 2,437 compared to
2,093 in the 2004 second quarter, and improved slightly from the
2005 first quarter of 2,433. As a percent of same-facility nursing
home census, Medicare patients represented 19.1% in the 2005
second quarter compared to 16.6% in the 2004 second quarter.
Nursing home occupancy, on a same-facility basis, rose during the
2005 second quarter to 92.7% compared to 91.8% in the 2004 second
quarter, and was down moderately from 93.8% in the 2005 first
quarter.  The performance on a same-facility basis of EHSI
remained strong in the 2005 second quarter as a result of
maintaining average daily Medicare census, increased Medicaid
funding, and lower utility costs.

Extendicare's acquisition of ALC is performing above management's
initial expectations.  For the 2005 second quarter, ALC
contributed revenue of $57.8 million (US$46.6 million) and EBITDA
of $13.9 million (US$11.2 million).  However, these results were
impacted by adjustments that related to the 2005 first quarter,
as the Company refined its preliminary purchase price allocation
of ALC's net assets acquired. Excluding these adjustments,
ALC's revenue and EBITDA for the 2005 second quarter were
US$46.2 million and US$10.2 million, respectively.

In July 2005 the Centers for Medicare and Medicaid Services
announced their final regulations and rates for Medicare for
fiscal 2006, subject to approval.  If approved, CMS will implement
a 3.1% market basket increase effective October 1, 2005, and
changes to the Resource Utilization Groups funding categories that
will reduce the average per diem rates effective January 1, 2006.  
While CMS's proposal was more positive for the industry than
previously anticipated, Extendicare estimates the new funding
formula will result in a net decline in its average Medicare rate
per diem of about US$10.00, commencing in January 2006.

Additionally, CMS's recent approval of Indiana's provider tax
plan provided Extendicare with 21 months of revenue totalling
$16.3 million (US$13.1 million), and earnings before income taxes
of $6.9 million (US$5.6 million), retroactive to July 1, 2003, in
the 2005 second quarter.  The impact of this, together with other
prior period Medicaid settlement adjustments in the quarter,
contributed $0.05 of earnings per diluted share.

         Quarters ended June 30, 2005 and June 30, 2004

Revenue grew by 16.4% to $518.9 million in the 2005 second quarter
in comparison to the 2004 second quarter.  Excluding new and
disposed facilities, revenue on a same-facility basis grew by
$19.4 million, or 4.5%.  Prior to a negative $30.2 million impact
from a stronger Canadian dollar, same-facility revenue grew
$49.6 million or 11.4%, and was impacted by a number of items.

U.S. operations revenue on a same-facility basis grew by
$47.7 million (US$35.1 million, or 15.4% in its functional
currency).  Before prior period settlement adjustments this
revenue grew 9.9%, primarily due to an 8.8% increase in average
nursing home rates, and a 1.2% increase in nursing home resident
occupancy, of which Medicare patient census improved by 16.5%.

Revenue from Canadian operations on a same-facility basis grew
$1.9 million, or 1.5%, over the 2004 second quarter.  The 2004
second quarter results were positively impacted by a $1.8 million
funding adjustment for property tax.  Excluding this item,
same-facility revenue in the 2005 second quarter grew by
$3.7 million, or 3.1%.  The majority of this improvement related
to nursing home funding increases, most of which was flow-through
funding to enhance resident care.

EBITDA rose to $79.6 million in the 2005 second quarter from
$59.1 million in the 2004 second quarter, and as a percent of
revenue increased to 15.3% from 13.3%.  EBITDA on a same-facility
basis, and excluding the prior period revenue and provider tax
settlement adjustments, improved $1.6 million to $58.7 million
compared to $57.2 million, and as a percent of revenue was 13.4%
compared to 13.2%.  Prior to a $4.4 million negative impact of the
stronger Canadian dollar, EBITDA improved by $5.9 million, or
10.4%, of which $5.6 million was from improvements in U.S.
operations.

Net interest costs for the 2005 second quarter were up
$6.3 million from the 2004 second quarter.  This was primarily
due to the acquisition of ALC, and to interest income of
$2.3 million (US$1.7 million) recognized in the 2004 second
quarter on settlement of the Greystone notes receivable.

Net earnings from the Canadian operations were $3.7 million in the
2005 second quarter compared to $7.1 million in the 2004 second
quarter.  This was because the 2004 second quarter results
included the positive property tax funding adjustment to revenue
of $1.8 million and a $2.2 million after-tax gain from the sale of
an investment.

        Six Months ended June 30, 2005 and June 30, 2004

Net earnings for the first half of 2005 were $43.4 million
compared to net earnings of $46.7 million for the first half of
2004.  Results for both periods included a loss on the valuation
of interest rate caps, and a loss (gain) on disposal of assets,
impairment and other items.  In 2005, these items represented an
after-tax loss of $5.3 million and in the comparable 2004 period
they contributed after-tax earnings of $6.8 million.  Prior to
these items and the share of equity earnings, the Company's
earnings from health care operations improved by $9.5 million to
$46.4 million from $36.9 million in the first half of 2004.  The
stronger Canadian dollar negatively impacted net earnings for the
first half of 2005 by $2.9 million in comparison to the same 2004
period.

Net earnings from the Canadian operations reflected a decline to
$6.0 million in the first half of 2005 from $19.8 million in the
first half of 2004.  This was because the 2004 results included a
$14.5 million after-tax gain from the sale of assets.

Revenue grew $131.8 million, or 15.1%, to $1,007.0 million
in the first half of 2005 in comparison to $875.2 million
earned in the first half of 2004.  ALC contributed $93.5 million
(US$75.7 million) to the improvement.  Excluding new and disposed
facilities, revenue on a same-facility basis grew $47.7 million,
or 5.6%.  The stronger Canadian dollar negatively impacted the
change in same-facility revenue by $54.4 million, leaving
improvements of $102.1 million.  The majority of this resulted
from growth in U.S. operations same-facility revenue of
$95.6 million (US$71.4 million, or 15.7% in its functional
currency).  Before prior period settlement adjustments this
revenue grew 10.0%, primarily due to an 8.3% increase in average
nursing home rates, and a 2.0% increase in nursing home resident
occupancy, of which Medicare patient census improved by 14.2%.

EBITDA rose to $138.7 million in the first half of 2005 from
$110.0 million in the first half of 2004, and as a percent of
revenue increased to 13.8% from 12.6%.  EBITDA on a same-facility
basis, and excluding prior period revenue and provider tax
settlement adjustments, improved $1.6 million to $109.3 million
compared to $107.6 million, and as a percent of revenue was 12.6%
for both periods.  Prior to a $7.3 million negative impact of the
stronger Canadian dollar, EBITDA improved by $8.9 million, or
8.3%, of which $7.5 million was from improvements in U.S.
operations.

Net interest costs for the first half of 2005 were up $7.3 million
from the first half of 2004.  Excluding the impact of a favorable
$1.7 million change due to the stronger Canadian dollar, these
costs increased $9.0 million between periods.  The 2004 results
included interest income associated with the settlement of the
Greystone notes receivable of $3.5 million (US$2.7 million).  The
remaining $5.4 million increase was primarily due to the
acquisition of ALC, partially offset by lower other debt and
interest rates.

The Company reported a tax provision of $25.4 million in the first
half of 2005 compared to $17.4 million in the first half of 2004.   
The Company's effective tax rate was impacted in the 2004 first
quarter by asset disposals, whose gains were sheltered by capital
losses.  Excluding these items, the Company's effective tax rate
in the first half of 2005 was 38.4% compared to 37.2% in the first
half of 2004.  The Company's effective tax rate in 2004 was lower
primarily because of available state non-capital operating losses.

Cash flow from operations was $51.3 million for the first half of
2005 compared to $85.4 million in the first half of 2004.  The
2004 results included a cash dividend from Crown Life Insurance
Company of $15.6 million.  The improvement in earnings was offset
by changes in working capital items.  The Medicaid funding and
provider tax increases received in 2005 have increased the
balance of accounts receivable and accounts payable at the end of
June 2005.

                           Other Items

The Company recorded a 2005 second quarter pre-tax loss of
$6.3 million on disposal of assets and impairment of long-lived
assets related to activity in its U.S. operations.  The pre-tax
loss represented a gain of $0.8 million on the sale of an
investment, offset by a $7.1 million provision for asset
impairment of a U.S. nursing home whose operations were
transferred to a third-party in 2004.

In June 2005, EHSI acquired a 127-bed nursing facility in Kentucky
for $10.3 million (US$8.2 million).

EHSI is currently in negotiations for the sale of its six
remaining leased nursing home properties in Florida for proceeds
of about US$10.0 million and a pre-tax gain on sale of
approximately US$4.0 million.  The transaction is anticipated to
be completed in the 2005 third quarter.

On August 4, 2005, EHSI amended its US$155.0 million credit
facility (Amended and Restated Credit Facility) to among other
things: increase the borrowing capacity to US$200.0 million,
comprised of a US$86.0 million term loan and a US$114.0 million
revolving credit facility, and to extend the maturity date for
just over one year to July 31, 2010.

In addition, EHSI would have the ability, with willing lenders,
to increase the term loan or the revolving credit facility by up
to US$15.0 million, for a total credit facility of up to
US$215.0 million.  Proceeds from the Amended and Restated Credit
Facility were immediately used to terminate and repay the balance
of ALC's US$34.0 million of borrowings under its GE Capital Term
Loan and Credit Facility, and will also be used to repay ALC's
approximately US$22.0 million of Revenue Bonds.  Upon the payment
in full of ALC's Revenue Bonds, and subject to certain
limitations, EHSI will no longer be restricted from advancing
funds to and from ALC, including funds from borrowings under its
Amended and Restated Credit Facility.

During 2005 the Company has acquired, under the terms of its
normal course issuer bid, 664,100 Subordinate Voting and Multiple
Voting shares at an average cost per share of $17.33.

On Aug. 4, 2005, the Directors declared quarterly dividends on
Extendicare's common shares and Class I Preferred Shares, payable
on November 15, 2005, to shareholders of record on Oct. 31, 2005.  
The dividends on the common shares are $0.05 per Subordinate
Voting Share and $0.025 per Multiple Voting Share.  The dividends
on the Class I, Series 3 Preferred Shares (EXE.PR.C) are
$0.2475 per share.  The dividends on the Class I, Series 2
(EXE.PR.B) and Series 4 (EXE.PR.D) Preferred Shares will be
determined by applying $25.00 to one quarter of 71% and 72% of the
average Canadian prime rate of interest, respectively, for the
quarter ending September 30, 2005.  In addition, the Directors
declared the monthly dividend of $0.071 per share on Extendicare's
Class II Preferred Shares, Series 1 (EXE.PR.E), payable on
September 15, 2005 to shareholders of record on August 31, 2005.

Extendicare is a major provider of long-term care and related
services in North America.  Through its subsidiaries, Extendicare
operates 441 nursing and assisted living facilities in North
America, with capacity for over 34,600 residents.  As well,
through its operations in the United States, Extendicare offers
medical specialty services such as subacute care and
rehabilitative therapy services, while home health care services
are provided in Canada.  The Company employs 37,900 people in
North America.

Extendicare, Inc., through its subsidiaries, currently operates
440 long-term care facilities across North America, with capacity
for over 34,400 residents.  As well, through its operations in the
United States, Extendicare offers medical specialty services such
as subacute care and rehabilitative therapy services, while home
health care services are provided in Canada.  The Company employs
38,000 people in North America.

                         *     *     *

As reported in the Troubled Company Reporter on April 14, 2004,
Standard & Poor's Ratings Services affirmed Extendicare Inc.'s
'B+' corporate credit rating.  The outlook was revised to positive
from stable.


FAIRFAX FINANCIAL: S&P Affirms BBB Counterparty Credit Rating
-------------------------------------------------------------
Standard & Poor's Ratings Services affirmed its 'BBB' counterparty
credit and financial strength ratings on Fairfax Financial
Holdings Ltd.'s (FFH) ongoing operating insurance companies
(collectively, Fairfax).
     
Standard & Poor's also affirmed its 'BB' counterparty credit
ratings on FFH and Crum & Forster Holdings Corp.
     
The outlook on these ratings has been revised to positive from
stable.
      
"The positive outlook is due to FFH and its operating companies
having shown substantial improvement in almost all of the major
rating factors, and this is expected to continue," explained
Standard & Poor's credit analyst Damien Magarelli.
     
The ratings are based on:

   * improving competitive position;

   * strong consolidated capitalization (even after adjustments
     for finite reinsurance); and

   * improved financial flexibility.

Offsetting these positives are:

   * reserves, which though not an immediate concern, have
     frequently been strengthened and might require some further
     modest charges;

   * some very poor acquisitions and sizeable reserve charges for
     which Fairfax has utilized finite reinsurance; and

   * debt to support operating company obligations, resulting in
     high debt leverage.
     
In the future, an upgrade may be warranted based on year-end 2005
financial statements should earnings improvements continue and no
longer be dependant on realized capital gains and net investment
income.  A combined ratio near 96% at the continuing operations
(excluding runoff) without any sizeable reserve charges (including
runoff) would potentially warrant raising the ratings.  

In contrast, should reserves deteriorate above expectations, if
holding company funds are not maintained near $350 million, or if
earnings do not continue to improve as the market softens, the
positive outlook might be revised to stable.


FASSBERG CONSTRUCTION: Hires Horvitz & Levy as Appellate Counsel
----------------------------------------------------------------
The Honorable Geraldine Mund of the U.S. Bankruptcy Court for the
Central District of California in San Fernando gave Fassberg
Construction Company permission to employ Horvitz & Levy, LLP, as
its special appellate counsel.

The professional services Horvitz & Levy will render include, but
are not limited to, prosecution of the Debtor's appeal from a
judgment obtained by the Housing Authority of the City of Los
Angeles.

Sonya Geis, at Pasadenastarnews.com, reports that the Superior
Court entered a $4 million judgment against the Debtors in a
lawsuit filed by the Housing Authority in the Los Angeles Superior
Court.  That lawsuit and judgment led to the Debtor's bankruptcy
filing on April 1, 2005.

Daniel J. Gonzalez, Esq., a partner at Horvitz & Levy, is the lead
attorney in this engagement.  Mr. Gonzalez charges $475 per hour
for his services.  His partner, Fred Cohen, Esq., will serve as
supervising attorney at $525 per hour.

Other attorneys from Horvitz & Levy may assist the lead
professionals in the course of this case. Their hourly rates
are:

      Designation            Hourly Rate
      -----------            -----------
      Senior Attorneys       $350 to $600
      Associates             $220 to $330
      Paralegals                 $110
  
Mr. Gonzalez tells the Court that his Firm received a $130,000
pre-petition retainer from the Debtor.  The Firm has exhausted the
retainer, leaving a $39,535 balance owed by the Debtor for legal
services and the reimbursement of expenses in connection with the
pending appeal.  The Firm will receive an additional $15,000 post-
petition retainer for services through August 31, 2005.

Mr. Gonzalez assures the Court that Horvitz & Levy does not hold
any interest adverse to the Debtors or its estate.  

Horvitz & Levy LLP is the largest civil appellate law firm in
California.  The Firm has achieved particular success in
challenging awards of punitive damages.  During the past
decade the Firm has obtained the reversal or reduction of over
$1.4 billion in punitive damage awards it has challenged on
appeal.  With respect to punitive damages awards, the Firm has
obtained the reversal of over $.95 of every dollar of punitive
damages assessed against its clients.

Headquartered in Encino, California, Fassberg Construction Company
is a full service general contracting and construction management
firm specializing in providing high-quality, professional and
comprehensive contracting services to the market-rate, affordable,
senior and mixed-use housing markets.  The Company filed for
chapter 11 protection on April 1, 2005 (Bankr. C.D. Calif. Case
No. 05-11957).  Douglas M. Neistat, Esq., at the  Law Offices of
Greenberg & Bass, serves as  counsel in the Debtor's bankruptcy
case.


FASSBERG CONSTRUCTION: Retains Hunt Ortmann as Special Counsel
--------------------------------------------------------------
The U.S. Bankruptcy Court for the Central District of California
in San Fernando authorized Fassberg Construction Company to employ
Hunt, Ortmann, Blasco, Palffy & Rossell, Inc., as its Special
Counsel.

Hunt Ortmann, which specializes in construction law, will assist
the Debtor in these proceedings:

     a) the 901 Broadway Vista Affordable Housing Project;
     b) Fassberg Construction Company v. DDB;
     c) Fassberg Construction Company v. Franco Development;
     d) the Broadway Village II/SAL OYA Construction Co.;
     e) the UCLA SWCH BBP1 Project and matters involving Apex;
     f) the Oak Creek Senior Village Project;
     g) the Buckingham Place Senior Housing matter; and
     h) Issacs v. Fullstron & Fassberg.

John D. Darling, Esq., a partner at Hunt Ortmann and the lead
attorney in this engagement, tells the Court that his Firm
received a $100,000 pre-petition retainer from the Debtor.  Mr.
Darling bills $295 per hour for his services.  Other lawyers at
Hunt Ortmann charge from $190 to $500.  The hourly rates for the
Firm's paralegals and law clerks range from $125 to $160.     

The Debtor assures the Court that Hunt Ortmann does not hold any
interest adverse to the Debtor and its estates in the matters on
which it is to be employed.

Hunt, Ortmann, Blasco, Palffy & Rossell, is one of the foremost
authorities on construction law and litigation in California
offering additional legal services in the areas of real estate and
business.  Some of these areas of service include land
development, environmental, geotechnical, corporate and
partnership law.

Mr. Darling's practice centers on the resolution of construction
and real estate disputes.  He has extensive experience in various
forms of dispute resolution, including litigation, arbitration and
mediation in both public and private construction disputes.

Headquartered in Encino, California, Fassberg Construction Company
is a full service general contracting and construction management
firm specializing in providing high-quality, professional and
comprehensive contracting services to the market-rate, affordable,
senior and mixed-use housing markets.  The Company filed for
chapter 11 protection on April 1, 2005 (Bankr. C.D. Calif. Case
No. 05-11957).  Douglas M. Neistat, Esq., at the  Law Offices of
Greenberg & Bass, serves as  counsel in the Debtor's bankruptcy
case.


FINANCIAL INSTITUTIONS: Posts $12 Million Net Loss in 2nd Quarter
-----------------------------------------------------------------
Financial Institutions, Inc. (NASDAQ: FISI), a holding company of
community banks serving Central and Western New York, reported
results for the second quarter period ended June 30, 2005.

Net loss for the quarter was $12 million compared with net income
for the same period in the prior year of $5.6 million.  Net loss
for the six-month period of 2005 was $9.7 million.  Net income for
the six-month period of 2004 was $8.2 million.

FII had previously announced a decision to sell a substantial
portion of the Company's problem credits.  As a result, the
Company recorded loan charge-offs of $37 million to the allowance
for loan losses and increased the provision for loan losses to
$21.9 million and $25.6 million for the second quarter of 2005 and
the first six months of 2005, respectively.  Also in the second
quarter the Company incurred a $2.4 million loss from discontinued
operations relating to a decision to sell its subsidiary, the
Burke Group Inc.  BGI was reported as discontinued operations as
of and for the periods ended June 30, 2005, and is expected to be
sold in the third quarter of this year at its approximate carrying
value at June 30, 2005.

"We are pleased with the result of our loan sale process, as it
has enabled us to make significant progress in improving our asset
quality," Peter G. Humphrey, Chairman, President and CEO of
Financial Institutions, Inc., said.  "The financial results of
this quarter are complex, but also reflect the significant strides
we are making strategically as evidenced by:

   -- We have a much stronger management team.

   -- We continue to add quality, experienced talent to our banks.

   -- We have capital ratios that meet, or exceed, regulatory
      requirements.  And, based on the expected results of the
      loan sale process, we should see measurable improvements in
      the quality of our loan portfolio.

   -- We are focused on our core community banking business
      leveraging our strong, retail franchise with the friendly
      and comfortable service our customers have always known.  
      The potential sale of BGI is a strategic move to maintain
      our focus on our community banking services within our
      territory.

   -- We still believe there is more to be accomplished. We
      continue to maintain open communications with regulators
      regarding National Bank of Geneva and Bath National Bank.
      Our Board is moving forward with their assessment of
      consolidating two or more banks. And, we have more
      functional areas that can be consolidated to improve control
      and lower our risk profile."

               Asset Quality and Loan Sale Process

FII, during the second quarter 2005, had identified approximately
$174.6 million in criticized and classified loans to be sold to
improve overall loan portfolio credit quality.  Before the end of
the quarter, $7.3 million of those loans were settled, and the
remaining $167.3 million were classified as loans held for sale at
an estimated fair value less cost to sell of $131.0 million.  The
loan charge-offs recorded to the allowance for loan losses as a
result of these actions was $37 million.  The Company has
agreements to sell or settle $79.0 million of the $131.0 million
in loans held for sale.  The remaining $52 million of loans held
for sale are recorded at their estimated fair value less cost to
sell and are currently being marketed.  FII anticipates receiving
bids for the loans prior to the end of the third quarter.

Nonperforming loans at June 30, 2005 were $17.2 million, down 65%
from $49.0 million from June 30, 2004 and down 73% from $62.6
million from March 31, 2005.  The significant decline in
nonperforming loans was the result of the decision to sell the
loans noted above.  The ratio of nonperforming loans to total
loans, excluding loans held for sale, was 1.67% at the end of the
second quarter 2005 compared with 4.31% at December 31, 2004 and
3.77% at the end of last year's second quarter.  The ratio of
nonperforming assets to total assets was 7.09% at June 30, 2005
compared with 2.56% and 2.29% at December 31, 2004 and June 30,
2004, respectively.  Nonperforming assets includes $131.0 million
in non-accruing loans held for sale at June 30, 2005 which are
recorded at estimated fair value less cost to sell and includes no
loans held for sale at December 31, 2004 or June 30, 2004.  Net
loan charge-offs in the second quarter of 2005 were $40.8 million
including $37.0 million relating to loans transferred to held for
sale. The allowance for loan losses to nonperforming loans,
excluding loans held for sale, improved to 123% at the end to the
second quarter 2005 from 72% at December 31, 2004 and 63% at June
30, 2004. At June 30, 2005 the allowance for loan losses as a
percentage of total loans was 2.04%.

In late July, Bath National Bank and the National Bank of Geneva
received reviews regarding the Reports of Examination from the
Office of the Comptroller, the regulatory body to which the banks
report, regarding the performance of the banks for the period
ending December 31, 2004.  The two banks are currently operating
under formal agreement with the OCC.  The review, which recognized
the actions taken since the year end to address problem
situations, acknowledged the efforts of management but, in the
case of NBG, found that internal controls remained weak, credit
risk was high and rising, and board and management supervision was
unsatisfactory. It also directed for NGB to expand the scope of
its independent management consultant's review to include
employees and officers of FII. Noted also in the report was
management's finding last year of two Regulation O violations
involving now former board members of the bank and other new
violations. The examiners noted that they would be reviewing the
situations to determine if civil money penalties against the board
would be warranted.

Since the end of last year several changes have occurred at NBG,
which include the installment of a new bank president, a new
senior lending officer, and board member changes. And, as
discussed throughout, to address credit risk, the bank is involved
in the sale of a large part of its problem loans.

Mr. Humphrey commented, "A primary reason for the consideration of
consolidating our subsidiary banks into a single-state chartered
bank is the improved measures of control we could achieve and the
resulting lower overall risk profile. Our assessment of the
consolidation is progressing. As the first step in the regulatory
approval process required for such a consolidation, the New York
State Banking Department and the Federal Reserve Bank of New York
have begun a pre-application examination."

                    Discontinued operations

In June 2005, the Company determined to discontinue the operations
of BGI and sell the subsidiary.  The disposition is expected to
occur during the third quarter of 2005.  In conjunction with the
discontinuance of operations, the Company recorded a provision for
estimated loss on sale of BGI of $1.2 million and income tax
expense on the anticipated disposition of $1.1 million.  The
results of BGI have been reported separately as discontinued
operations in the consolidated statements of income (loss).  Prior
period financial statements have been reclassified to present
BGI's results as a discontinued operation.

                           Revenue

For the second quarter 2005 net interest income totaled $16.9
million, down $1.8 million compared with the 2004 second quarter.  
Average total loans including loans held for sale declined $99
million in the second quarter of 2005 compared with the prior
year's same period, while average total investment securities,
federal funds sold and interest bearing deposits increased $46
million, and total interest-earning assets declined $53 million.  
Net interest margin was 3.56% for the second quarter of 2005
compared with 3.83% for the second quarter of 2004.  The drop in
net interest margin was primarily attributed to the higher level
of non-accruing assets, the reversal of accrued and unpaid
interest on loans placed on nonaccrual, and a shift in the mix of
earning assets from loans to investments.

Net interest income for the six months ended June 30, 2005 and
2004 was $35.2 million and $37.2 million, respectively.  Average
interest earning assets declined $30 million for the first six
months of 2005 compared with the same period in 2004.  Net
interest margin for the six months ended June 30, 2005 was 3.73%
compared with 3.86% in the prior year.  The decline in net
interest margin relates to higher levels of nonperforming assets
and a shift in mix from loans to investment assets.  The drop in
net interest income reflects a lower average earning asset base
coupled with the decline in net interest margin.

Noninterest income for the second quarter and six month period of
2005 was $4.8 million and $9.7 million, respectively.  This
compares with noninterest income in the second quarter and first
half of 2004 of $6.4 million and $11.5 million.  Last year's
second quarter and first half included a $1.2 million gain on the
sale of the Company's credit card portfolio.

                      Noninterest expense

Noninterest expense increased $1.8 million for the second quarter
of 2005 to $16.6 million from $14.8 million for the second quarter
of 2004. Salaries and benefits represent $0.8 million of the
increase and legal, accounting, and other professional fees
represent $0.6 million of the increase. For the first six months
of 2005 noninterest expense was $33.0 million compared with $29.8
million for the same period in 2004. Salaries and benefits for the
first six months of 2005 compared with 2004 increased $1.1
million, while legal, accounting, and professional fees have also
increased $1.1 million. The increase in salaries and benefits
primarily relates to the addition of staff in the area of credit
administration and loan underwriting. The increase in legal,
accounting, and professional service fees relates to activities in
the area of asset quality expense, regulatory compliance, and
consolidation projects.  The increases in noninterest expense,
excluding the losses from discontinued operations, combined with a
decline in revenue, resulted in an increase in the efficiency
ratio to 72.27% for the second quarter of 2005 compared with
58.11% for the second quarter of 2004.

                        Default Waiver

Currently, the Company has a $25 million term loan that requires
monthly payments of interest only.  At June 30, FII was in default
of certain covenants in the loan agreement which have subsequently
been waived by its lender.  The Company has begun discussions with
its lender to modify the covenants in its lending agreement, but
in the meantime, has reclassified the long-term debt to short term
debt on its balance sheet.

Shareholders' equity at the end of the second quarter was
$169.4 million, down from $184.3 million at the end of the second
quarter of last year.  The decline primarily reflects the earnings
impact of the actions taken by the Company to improve its asset
quality.

Financial Institutions, Inc. -- http://www.fiiwarsaw.com/-- is  
the bank holding company parent of Wyoming County Bank, National
Bank of Geneva, Bath National Bank, and First Tier Bank & Trust
with $2.1 billion in assets.  Its four banks provide a wide range
of consumer and commercial banking services to individuals,
municipalities, and businesses through a network of 50 offices and
72 ATMs in Western and Central New York State.  FII's Financial
Services Group also provides diversified financial services to its
customers and clients, including brokerage, trust and insurance.


FLYI INC: Says Cash Flow Woes May Soon Force a Bankruptcy Filing
----------------------------------------------------------------
FLYi, Inc. (Nasdaq: FLYI), parent of low-fare airline Independence
Air, warns that it may be forced to reorganize under chapter 11 of
the U.S. Bankruptcy Code or liquidate in a chapter 7 proceeding,
if it fails to address its liquidity needs.

FLYi is re-evaluating the scope and nature of its Independence Air
operations and is continuing to evaluate and undertake
initiatives, including:

   -- deferral of aircraft deliveries and return of associated
      deposits;

   -- efforts to sell the Company's owned 328Jet aircraft and its
      328Jet spare parts inventory; and

   -- negotiation of a Power By the Hour maintenance service
      arrangement.

The Company is exploring and pursuing discussions with third
parties in order to provide the Company with near-term liquidity.

Cash provided by the Company's operations is currently on the
negative and is projected to continue for the remainder of 2005.  
The Company has no lines of credit or other borrowing facilities
to generate cash and essentially all of the Company's assets have
been pledged as collateral to secure its outstanding debt and
other obligations.  The Company disclosed that any additional sale
of equity or convertible debt securities would likely be dilutive
to the Company's stockholders.

                     Aircraft Lease Agreement

The Company and Independence Air are parties to an agreement with
GE Capital Aviation Services that establishes certain financial
milestones applicable to three-month periods ending in June,
September, October, November and December 2005 and January,
February and March 2006.  The agreement provides that should the
Company fail to meet certain milestones targets, GE Capital will
have the option to terminate the lease for one additional
Bombardier Canadair Regional Jet aircraft for each month, up to a
maximum of eight CRJ aircraft.  This option is exercisable by
notice from GE Capital for up to 90 days following the delivery of
the financial statements for each applicable month, with aircraft
to be removed no earlier than 45 days following such notice.  The
Company did not meet the first milestone, and does not anticipate
that it will meet subsequent milestones.  The termination of
leases would be on the same terms as that for other aircraft
returned as part of the February 2005 restructuring.

Independence Air continues to evaluate and adjust its flight
schedule in order to reduce costs, increase revenue, and better
utilize its assets.  It recently adjusted its A319 flight schedule
effective September 2005 to reduce the number of transcontinental
flights, in order to increase the use of its A319 aircraft in East
Coast operations to take advantage of higher returns presently
available in shorter stage lengths.  In anticipation of the
seasonal reduction in airline traffic expected after Labor Day,
the Company recently reduced its scheduled CRJ flying effective
September 2005 by approximately 17%, which will result in lower
CRJ aircraft utilization.  Other schedule changes are also being
implemented to provide operational improvements, including
operating fewer flights during Dulles peak operational time of day
and increasing connection times.  Further reductions in scheduled
CRJ flights could occur depending on a variety of factors,
including the exercise by GECAS of its option for the return of
any of eight CRJs, as well as subsequent changes in passenger
demand or further fuel price increases.

Independence Air -- http://www.FLYi.com/-- offers low fares every  
day to a total of 45 destinations across America with comfortable
leather seats and Tender Loving Service(SM).  

Independence Air is the low-fare airline that makes travel fast
and easy for its customers with a customer first attitude,
innovative thinking and a willingness to challenge the status quo.

At June 30, 2005, FLYi, Inc.'s balance sheet showed a $29,383,000
stockholders' deficit, compared to $167,134,000 of positive equity
at Dec. 31, 2004.


FLYI INC: June 30 Balance Sheet Upside-Down by $29.4 Million
------------------------------------------------------------
FLYi, Inc. (Nasdaq: FLYI), parent of low-fare airline Independence
Air, reported preliminary financial and operating results for the
second quarter 2005.  The company incurred a net loss of
$98.5 million for second quarter 2005, compared to second quarter
2004 net loss of $27.1 million in accordance with Generally
Accepted Accounting Principles.  In accordance with GAAP, the
revenues and expenses directly attributable to the Delta
Connection operation have been removed from second quarter 2004
operating income and reclassified as discontinued operations on
the Statement of Operations.

The company's GAAP net income for the second quarter of 2005 and
2004 also included:

   * In 2005:

      -- $43.4 million non-cash impairment charge included in
         operating expenses to write-down the value of the
         company's long-lived assets as the carrying amount of its
         long lived assets taken as a whole exceeded their fair
         value

      -- ($0.4) million for the second quarter 2005 as a result of
         restructuring costs in the second quarter of 2005 offset
         by a reversal of previously recorded aircraft early
         retirement charges of $3.6 million

   * In 2004:

      -- $21.9 million non-cash aircraft early retirement charge
         due to the retirement of ten leased J-41 aircraft from
         the United Express program

Excluding these charges and credits and the discontinued Delta
Connection operation, the company would have reported a net loss
of $55.5 million for second quarter 2005 compared to a net loss of
$14.1 million for second quarter 2004.

Recent developments reported by Independence Air include:

   -- Load factor increased during each month of the second
      quarter. April came in at 68.0%, May load factor was 72.9%,
      while June grew to 76.2%.

   -- The airline celebrated its first anniversary on June 16th,
      marking one year since the initial launch of Independence
      Air service from Washington Dulles International Airport to
      its first six destinations. During the anniversary week
      celebration, FLYi(SM) also welcomed its 5,000,000th
      customer.

   -- In just its first year of service, Independence Air was
      named third among all airlines operating domestic routes by
      the readers of Travel + Leisure Magazine in its annual
      "World's Best" edition

   -- The company was awarded with the Diamond Award by the
      Federal Aviation Administration -- presented to the
      Maintenance team every year since 1997. The award is the
      highest honor in the FAA's Aviation Technician Training
      Program.

Independence Air -- http://www.FLYi.com/-- offers low fares every  
day to a total of 45 destinations across America with comfortable
leather seats and Tender Loving Service(SM).  

Independence Air is the low-fare airline that makes travel fast
and easy for its customers with a customer first attitude,
innovative thinking and a willingness to challenge the status quo.

At June 30, 2005, FLYi, Inc.'s balance sheet showed a $29,383,000
stockholders' deficit, compared to $167,134,000 of positive equity
at Dec. 31, 2004.


FREEDOM MEDICAL: Files Disclosure Statement in Pennsylvania
-----------------------------------------------------------
Freedom Medical, Inc., delivered a Disclosure Statement explaining
its Plan of Reorganization to the U.S. Bankruptcy Court for the
Eastern District of Pennsylvania on August 5, 2005.

The Plan enables the Debtor to successfully emerge from
bankruptcy, preserve its business, maintain jobs and allow
creditors to realize the highest recoveries.

Under the Plan, administrative claims, priority claims, secured
tax claims, Canon Financial, Marlin and other priority claims will
be paid in full.

Greenwich Capital Financial Products, Inc., owed $21,433,585,
will be paid equal monthly principal installments of $120,000
until Dec. 31, 2007.  Payment to the lender could be less if the
Debtor makes a prepayment in accordance with a schedule of
Discounted Payoff Amounts.  The Discounted Payoff Amounts range
from $16.5 million (of payment is received on or before Oct. 31,
2005) to $19 million (if payment is received on or before June 30,
2007).  Greenwich is expected to recover 78% to 99% of its claim.

Med One Capital, Inc.'s $60,008 claim will be paid in full.  
However, the Debtor won't make payments to the claimant's lawyer.

Maquet asserts a disputed $380,000 claim.  According to the
Debtor's schedules, Maquet is owed $33,095 which, pursuant to the
Plan, will be paid in full.

As for the Debtor's action against RBC Dain Rauscher, the plan
outlines two options.  If Freedom's successful in the RBC
litigation, RBC's $76,525 claim will be setoff against the
judgment in favor of the Debtor.  If the judgment is in favor of
RBC, then its claim will be allowed as an allowed general
unsecured claim.

General unsecured creditors, owed between $729,387 to $2,066,701
in the aggregate, will recover 12.1% to 34.3% of their claims.  
The recovery amount will depend on:

   a) successful prosecution of objections to proofs of claim; and
   
   b) whether Frank Gwynn and Dominic Greco, the Debtor's
      respective President and CEO, will agree to waive their
      unsecured claims.

Convenience claim holders will be paid not more than $250.  

Equity interest holders will retain their shares in exchange for a
$50,000 aggregate cash contribution.

Headquartered in Exton, Pennsylvania, Freedom Medical, Inc.,
-- http://www.freedommedical.com/-- sells electronic medical   
equipment and related services to hospitals, alternate site
healthcare providers, and EMS transport organizations.  The
Company filed for chapter 11 protection on December 29, 2004
(Bankr. E.D. Pa. Case No. 04-37092).  Barry D. Kleban, Esq., at
Adelman Lavin Gold and Levin represents the Debtor.  When Freedom
Medical filed for protection from its creditors, it listed
estimated assets and debts of more than $50 million.


FRIENDLY ICE: Balance Sheet Upside-Down by $105 Million at July 3
-----------------------------------------------------------------
Friendly Ice Cream Corporation (AMEX: FRN) reported results for
the second quarter and six months ended July 3, 2005.

Comparable restaurant sales increased 3.4% for company-operated
restaurants and 5.4% for franchised restaurants for the quarter
ended July 3, 2005, compared to the quarter ended June 27, 2004.
Including the results of the current quarter, franchise-operated
restaurants have reported seventeen consecutive quarters of
positive comparable restaurant sales growth.

Total company revenues were $148.4 million in the second quarter
of 2005, an increase of $0.9 million, or 0.6%, as compared to
total revenues of $147.5 million for the second quarter of 2004.   
Restaurant revenues decreased by $1.6 million, which was offset by
a $1.9 million increase in foodservice revenues and a $0.6 million
increase in franchise revenues.

The re-franchising of 20 company-operated restaurants over the
last fifteen months resulted in a $5.1 million decline in
restaurant revenues when compared to the same quarter in the prior
year.

Net income for the three months ended July 3, 2005 was
$2.5 million, or $0.32 per share, compared to a net loss of
$1.4 million, or $0.19 per share, reported for the three months
ended June 27, 2004.  Included in the 2004 second quarter results
were $2.3 million in expenses ($1.4 million after-tax or $0.18 per
share) for debt retirement.

                        Six-Month Results

Comparable restaurant sales increased 0.2% for company-operated
restaurants and 3.5% for franchised restaurants for the six months
ended July 3, 2005 compared to the six months ended June 27, 2004.

For the six months ended July 3, 2005 total company revenues were
$273.1 million as compared to total revenues of $278.3 million for
the six months ended June 27, 2004. Restaurant revenues decreased
by $9.9 million, which was partially offset by a $3.9 million
increase in foodservice revenues and a $0.8 million increase in
franchise revenues.

The re-franchising of 37 company-operated restaurants over the
last eighteen months resulted in a $9.5 million decline in
restaurant revenues when compared to the same period in the prior
year.  Restaurant revenues were also impacted by an unfavorable
shift in the timing of the year-end holiday period.  New Year's
Day was included in the prior year first quarter and is not
included in the current year.  The estimated impact on
company-operated restaurants due to the timing of the holiday
reduced the six month comparable sales increase by 1.3%.

The net loss for the six months ended July 3, 2005 was
$0.5 million, compared to a net loss of $6.7 million, reported for
the six months ended June 27, 2004.  Included in the 2004 results
were $8.2 million in expenses ($4.8 million after-tax or $0.64 per
share) for debt retirement and restructuring costs, which were
partially offset by a gain on litigation settlement.

                     Performance Highlights

In the second quarter of 2005, Friendly's continued to pursue its
key strategic objectives to enhance the dining experience, expand
through franchising and re-franchising and grow higher margin
revenues. Key business highlights for the quarter include:

   -- Ongoing improvements to the Friendly's dining experience
      based on feedback from the new Internet-based guest feedback
      system.

   -- The opening of one new company-operated restaurant and two
      new franchised restaurants.

   -- The re-franchising of three company-operated restaurants,
      which resulted in a gain on franchise sales of restaurant
      operations and properties of $1.2 million.

   -- Continued growth in the number of supermarket chains that
      carry Friendly's decorated cakes, which are now being sold
      in over 500 supermarket locations.

                    Business Segment Results

In the second quarter of 2005, pre-tax income in the restaurant
segment was $8.1 million, or 7.2% of restaurant revenues, compared
to $7.4 million, or 6.4% of restaurant revenues, in the second
quarter of 2004.  The increase in pre-tax income was mainly the
result of a 3.4% increase in comparable company-operated
restaurant sales, reduced labor and benefit costs due to the
restructuring of the restaurant management team, fewer free
dessert promotions and lower expenses for advertising and general
liability insurance.  Partially offsetting these benefits were the
re-franchising of twenty restaurants over the past fifteen months
along with increased expenses for pension, workers compensation
insurance, maintenance, supplies and occupancy.  Friendly's
continues to pursue its initiatives that are designed to enhance
the Friendly's dining experience.  In addition to the
restructuring of the restaurant management team, other key
restaurant initiatives include:

   1) reduced spans of control for front-line and second-line
      supervisors,

   2) a new recognition and reward program for servers, and

   3) an Internet-based guest feedback system.

Pre-tax income in the Company's foodservice segment was
$3.4 million in the second quarter of 2005 compared to
$2.0 million in the second quarter of 2004.  The increase in
pre-tax income was mainly due to increased product sales to
franchised restaurants and lower commodity costs.  Case volume in
the Company's retail supermarket business increased 3.3% for the
second quarter of 2005 when compared to the second quarter of
2004.

Pre-tax income in the franchise segment increased in the second
quarter of 2005 to $2.8 million from $2.2 million in the second
quarter of 2004.  The improvement in pre-tax income is mainly due
to increased royalty revenue from comparable franchised restaurant
sales growth of 5.4% and from the opening of eight new franchised
restaurants and the re-franchising of 20 restaurants over the past
fifteen months.  Increased rental income from leased and sub-
leased franchised locations also contributed to the revenue growth
in the second quarter of 2005.

Corporate expenses of $11.4 million in the second quarter of 2005
increased by $0.5 million as compared to the second quarter of
2004 primarily due to increases in corporate bonus, pension
expense and other professional fees.

John L. Cutter, Chief Executive Officer and President of Friendly
Ice Cream Corporation stated,  "We are pleased with the results of
the second quarter with positive comparable restaurant sales in
both company and franchise restaurants and increased case volume
in our retail supermarket business.  In the first half of the
year, we opened one new company restaurant and our franchisees
opened two new franchise restaurants.  For the year, we currently
plan to open a total of four new company restaurants.  In the
second quarter, we completed five re-imaging projects and we plan
to complete at least fourteen re-imaging projects by year-end.  We
are also pleased with the growth in the number of supermarkets
that carry our decorated ice cream cakes, which are currently
being sold in over 500 supermarket locations.  Due to timing
delays in development, our franchisees currently plan to open a
total of ten new restaurants during 2005.  Our previous guidance
had been for fifteen new franchised restaurants to be opened in
2005."

Friendly Ice Cream Corporation -- http://www.friendlys.com/-- is  
a vertically integrated restaurant company serving signature
sandwiches, entrees and ice cream desserts in a friendly, family
environment in 530 company and franchised restaurants throughout
the Northeast. The company also manufactures ice cream, which is
distributed through more than 4,500 supermarkets and other retail
locations. With a 70-year operating history, Friendly's enjoys
strong brand recognition and is currently remodeling its
restaurants and introducing new products to grow its customer
base.  

As of July 3, 2005, Friendly Ice Cream's equity deficit widened to  
$105,099,000 from a $105,026,000 deficit at Jan. 2, 2005.


HIGH POINT: Gets Waivers from Lenders on Covenant Defaults
----------------------------------------------------------
High Point Resources Inc. (TSX:HPR) received a letter from a
Canadian chartered bank agreeing to waive a default until
August 31, 2005.  At June 30, 2005 the Corporation was not in
compliance with a banking covenant relating to the aging of trade
payables.  At June 30, 2005, $54,000,000 was drawn against the
credit facility.

The revolving term credit facility consists of two parts, Part A
is for $54,000,000 with interest at the bank's prime rate plus
0.25%, and Part B is for an additional $6,000,000 with interest at
the bank's prime rate plus 1.25%.  

Collateral for the facility consists of a demand debenture for
$100,000,000 secured by a first floating charge over all assets.

On December 2, 2004 a new standby 'Secured Development Bridge
Facility' was set up with a Canadian lending corporation. The
facility would allow for up to two drawdowns before March 31, 2005
for a minimum of $7,500,000 on the first drawdown, and to a
maximum of $15,000,000 combined.  Interest is to be paid at bank
prime plus 3.25%.  At June 30, 2005 the Corporation was not in
compliance with a covenant in the facility relating to the
maintenance of minimum working capital. The Corporation has
received a letter from the lending corporation, agreeing to waive
the default.  As of June 30, 2005, $15,000,000 was drawn against
this credit facility.

The company disclosed this information regarding its loans:

                           Second Quarter Ended        Six Months Ended
                           --------------------        ----------------
                             June 30,   June 30,    June 30,    June 30,
                                2005       2004        2005        2004

Interest                    $826,833   $506,145  $1,397,019  $1,013,431
Financing charges            285,984     56,960     405,184     106,963
                           ---------------------------------------------
Interest and other
financing charges         1,112,817    563,105   1,802,203   1,120,394

High Point Resources, Inc., is a Canadian junior oil and gas
company focused on natural gas in the deeper part of the Western
Canada Sedimentary Basin.  Exploration and development activities
are conducted in Western Alberta and British Columbia.


ICOS CORP: Balance Sheet Shows $57 Mil. Equity Deficit at June 30
-----------------------------------------------------------------
ICOS Corporation (Nasdaq:ICOS) released its financial results for
the three and six months ended June 30, 2005.

Lilly ICOS LLC (Lilly ICOS), a 50/50 joint venture between ICOS
Corporation and Eli Lilly and Company, that is marketing Cialis(R)
(tadalafil), is approaching profitability as a result of both
sales growth and reductions in marketing and selling expenses.
Lilly ICOS' 2005 second quarter net loss narrowed to $1.7 million,
compared to $41.7 million in the 2005 first quarter.  

Worldwide sales of Cialis in the second quarter of 2005, totaled
$190.9 million, an increase of 39%, compared to $137.2 million in
the second quarter of 2004.  Notably, Lilly ICOS reached a
significant milestone, in the 2005 second quarter, when cumulative
worldwide sales of Cialis passed the $1 billion mark.

Lilly ICOS continues to pursue new treatment opportunities with
tadalafil, the active ingredient in Cialis, which has been used by
more than five million patients with erectile dysfunction.  Lilly
ICOS recently initiated a Phase 3 clinical study of tadalafil for
the treatment of pulmonary arterial hypertension.

"We are excited about the new opportunities for Cialis," stated
Paul Clark, ICOS Chairman, President and CEO.  "And, we are proud
that cumulative worldwide sales of Cialis, since launch, have
surpassed $1 billion.  Market share continues to grow solidly,
reaching 23.3% in the U.S. in June 2005, and 31.2% in the
aggregate, across Europe, Canada and Mexico, in June 2005."

                        Financial Results

For the three months ended June 30, 2005, ICOS reported a net loss
of $22.6 million, compared to a net loss of $51.9 million for the
three months ended June 30, 2004.

Equity in losses of Lilly ICOS was $0.7 million in the second
quarter of 2005, compared to $35.1 million in the corresponding
period of 2004.  The decreased Lilly ICOS losses reflect increased
worldwide Cialis revenues and an overall reduction in selling and
marketing expenses compared to the 2004 second quarter.

ICOS Corporation's total revenue was $18.1 million in the second
quarter of 2005, compared to $17.9 million in the second quarter
of 2004.

Collaboration revenue from Lilly ICOS totaled $12.7 million in the
2005 second quarter, compared to $14.7 million in the second
quarter of 2004.  The decrease primarily reflects a reduction in
Lilly ICOS' reimbursement of our U.S. sales force expenses, from
100% in 2004, to 60% beginning in January 2005, partially offset
by higher revenue for research and development activities
conducted on behalf of Lilly ICOS.

Co-promotion services revenue was $1.9 million in the 2005 second
quarter. We began promoting AndroGel(R) (testosterone gel) to
physicians, on behalf of Solvay Pharmaceuticals, Inc., in February
2005.

Total operating expenses were $40.0 million for the three months
ended June 30, 2005, compared to $34.7 million for the three
months ended June 30, 2004.

Research and development expenses increased $3.8 million from the
three months ended June 30, 2004, to $21.3 million for the three
months ended June 30, 2005.  The increase was primarily due to
higher expenses associated with our discovery and preclinical
research programs and incremental development activities being
performed by ICOS personnel on behalf of Lilly ICOS, partially
offset by the discontinuation of a clinical program in the 2005
first quarter.

For the six months ended June 30, 2005, ICOS reported a net loss
of $69.0 million, compared to a net loss of $138.2 million for the
six months ended June 30, 2004.  The 2005 decrease is primarily
due to lower Lilly ICOS losses.

At June 30, 2005, the company had cash, cash equivalents,
investment securities and associated interest receivable of
$192.6 million.

                       Financial Guidance

Lilly ICOS' net income for the year ending December 31, 2005, is
expected to be around $30 million, plus or minus $10 million.  The
level of Cialis sales achieved is the primary variable that will
affect Lilly ICOS' results for 2005.  The company presently
expects 2005 worldwide Cialis net product sales around
$775 million.  The Company also expects Lilly ICOS' selling,
general and administrative expenses to decline, in the second half
of 2005, compared to both the second half of 2004 and the first
half of 2005.

The Company presently expect that ICOS Corporation's net loss
for the year ending December 31, 2005, will be in the range of
$77 million to $82 million, assuming net income of $30 million for
Lilly ICOS in 2005.

The expected decrease in ICOS' net loss in 2005, compared to
$198 million in 2004, is primarily due to our expectation that
Lilly ICOS will be profitable in 2005, compared to Lilly ICOS
having reported a net loss of $262 million in 2004.

ICOS Corporation, a biotechnology company headquartered in
Bothell, Washington, is dedicated to bringing innovative
therapeutics to patients.  Through Lilly ICOS LLC, ICOS is
marketing its first product, Cialis (tadalafil), for the treatment
of erectile dysfunction.  ICOS is working to develop treatments
for serious unmet medical conditions such as benign prostatic
hyperplasia, pulmonary arterial hypertension, cancer and
inflammatory diseases.

As of June 30, 2005, ICOS Corp.'s balance sheet reflected a
$57,343,000 equity deficit at June 30, 2005, compared to
$6,528,000 of positive equity at Dec. 31, 2004.


INTEGRATED ELECTRICAL: Posts $13.9 Million Net Loss in 3rd Quarter
------------------------------------------------------------------
Integrated Electrical Services, Inc. (NYSE: IES) reported results
for its fiscal 2005 third quarter ended June 30, 2005.  The
company reported revenues of $284.0 million and a net loss for the
third quarter of $13.9 million.  

The 2005 third quarter net loss includes:

    * A loss of $4.6 million from discontinued operations
      including a non-cash write off of goodwill of $4.3 million;

    * A loss of $1.6 million related to gross profit losses on
      utility projects at one business unit;

    * A $1.5 million increase in accounting fees related to
      Sarbanes-Oxley compliance procedures and increased audit
      fees;

    * Approximately $1.4 million of non-cash interest costs due to
      a write-off and accelerated amortization of deferred
      financing costs due to the reduced size and shortened
      maturity of the company's previous credit facility;

    * A loss of $700,000 related to an increase in a legal reserve
      due to an unfavorable verdict leveled against the company;
      and

    * A non-cash charge of $500,000 related to equity in losses on
      an investment.

The above items total $10.3 million.  Excluding the above items,
the net loss in the third quarter of fiscal 2005 would have been
$3.6 million.

Fiscal 2005 third quarter revenues from continuing operations of
$284.0 million increased from this year's second quarter revenues
of $282.3 million and decreased from the previous year's third
quarter revenues of $311.3 million.  The revenue decline from the
previous year is primarily the result of a decrease in the pursuit
of bonded projects, more selective bidding on new project work and
the winding down of utility and plant work at one subsidiary.  As
a result of the company's strategic review process undertaken in
the first quarter of fiscal 2005, IES has reduced its dependence
on large bonded work to improve profitability and return on
invested capital.

Gross profit in the third quarter was $37.4 million versus $31.6
million in the second quarter and $37.3 million in the third
quarter a year ago.  Overall gross profit margins in the third
quarter improved to 13.2% from 11.2% in the previous quarter and
from 12.0% in the third quarter of fiscal 2004. Loss from
operations decreased to $1.0 million or 0.3% of revenues in the
third fiscal quarter of 2005 from a loss of $4.7 million or 1.7%
of revenues in the previous quarter.

Byron Snyder, IES' president and chief executive officer, stated,
"We are making solid progress in our ongoing efforts to improve
performance and strengthen the bottom line.  By refinancing our
existing credit facility, improving operational control and
support and growing the residential and service businesses, we
believe we are helping IES become a financially secure and
consistent performer for our stakeholders."

David Miller, IES' chief financial officer, added, "Although we
reported a loss in the third quarter, our commercial margins and
margins as a whole are improving. Our overall gross margins were
13.2%, a 200 basis point improvement over last quarter.  Although
much of the improvement was masked by non-operational items that
occurred in the quarter, we are seeing visible progress in our
operations."

                       New Senior Loan

On August 1, 2005, IES closed on a new senior secured credit
facility with Bank of America as administrative agent.  The new 3-
year, $80 million asset- based lending facility replaced the
previous $60 million credit facility set to expire on August 31st.
Fully underwritten by Bank of America, the new facility will be
used to issue standby and commercial letters of credit and finance
the company's ongoing working capital needs.  Collateral for the
facility includes all assets not previously pledged to the surety
provider. The company is currently in compliance with all
covenants of the new facility.

As of June 30, 2005, total debt was $223.0 million compared to
$225.4 million at the end of the previous quarter.  Total debt at
year end September 30, 2004 was $231.0 million.  As of August 9,
2005, IES' total debt remained at $223.0 million, and cash totaled
approximately $35.4 million.

Interest expense for the third fiscal quarter was $7.6 million
compared to $5.0 million for the third fiscal quarter of 2004.  
The reduction of size and the shortening of the maturity of its
previous credit facility during the third quarter required the
company to write off a portion of its deferred financing costs and
accelerate the remaining amount.  This resulted in a $1.4 million
non-cash increase to interest expense in the quarter.

                         Divestitures

IES has completed the sale of substantially all of the assets of
one of its commercial and industrial business units based in South
Dakota for a sales price of approximately $4.7 million.  This unit
had net revenues of $17.7 million and operating income of $1.5
million for the previous twelve months.  Because of its high
dependency on bonding and a resulting decrease in backlog of 78%
since September 30, 2004, IES had planned on shutting this unit
down.

As was previously announced, based on a continuous review of each
business unit that includes a focus on consistency of
profitability; return on capital, including capital employed for
bonding; construction spending and growth trends; and management
strength, IES has chosen to divest certain units that were
underperforming or no longer suited to IES' operational plan going
forward.

To date, IES has sold 12 units, primarily operating in the
commercial/industrial market, for total cash proceeds of $41.8
million and has closed two units.  These 14 units had combined net
revenues of $217.7 million and operating income of $7.5 million in
fiscal 2004.

IES plans to maintain the focus it set early this fiscal year to
improve company operations.  By reducing bonding dependence,
choosing jobs that are smaller, shorter term and more profitable
and divesting units that are underperforming or no longer suited
to IES' current business plan, profit and operating margins are
improving.  IES believes that certain units still need to show
operational improvement to further the company's recovery.  With
the increased customer confidence gained from the successful
refinancing, IES intends to rebuild backlog levels with attractive
new opportunities.

Integrated Electrical Services, Inc. is a national provider of
electrical solutions to the commercial and industrial, residential
and service markets.  The company offers electrical system design
and installation, contract maintenance and service to large and
small customers, including general contractors, developers and
corporations of all sizes.

                         *     *     *

As reported in the Troubled Company Reporter on May 19, 2005,
Moody's Investors Service has downgraded the ratings of Integrated
Electrical Services, Inc. one notch to B3 senior implied and to
Caa2 for its guaranteed senior subordinated debt of $173 million
due 2009 and changed the outlook to negative.

Moody's has downgraded these ratings:

   * Senior Implied, downgraded to B3 from B2;

   * Senior Unsecured Issuer Rating, downgraded to Caa1 from B3;

   * $173 million (remaining balance) of 9.375% senior
     subordinated notes due 2009 (in two series), downgraded to
     Caa2 from Caa1.

The ratings outlook is changed from stable to negative.


INTEGRATED HEALTH: Wants Entry of Final Decree Delayed to Nov. 3
----------------------------------------------------------------
As previously reported in the Troubled Company Reporter on May 17,
2005, the U.S. Bankruptcy Court for the District of Delaware
approved the IHS Liquidating LLC's request to:

   (1) delay the entry of a final decree closing the Chapter 11
       case of Integrated Health Services, Inc., Case No. 00-389
       (MWF) until November 3, 2005; and

   (2) extend the date for filing a final report and accounting
       for all the IHS Debtors' cases until August 2, 2005.

*   *   *

Robert S. Brady, Esq., at Young Conaway Stargatt & Taylor, LLP, in
Wilmington, Delaware, tells the Court that the IHS liquidating LLC
needs to ensure that it has a full opportunity to continue to
prosecute or resolve pending claim objections and other matters in
the IHS Debtors' Chapter 11 cases.

Mr. Brady points out that the Court's jurisdiction may still be
required while the claims administration process is ongoing.

By this motion, IHS Liquidating asks the Court to:

   (1) delay the entry of a final decree closing the Chapter 11
       case of Integrated Health Services, Inc., Case No. 00-389
       (MWF), until May 2, 2006; and

   (2) extend the date for filing a final report and accounting
       for all the IHS Debtors' cases until January 30, 2006.

Mr. Brady asserts that delaying entry of a final decree for the
IHS Debtors' cases will help ensure that distributions in
appropriate amounts are made only to actual creditors under the
IHS Plan.

"Moreover, a final report and accounting will not be accurate
since the claims administration process has not come to a
conclusion," Mr. Brady says.

The Court will hold hearing to consider IHS Liquidating's request
at 2:00 p.m. prevailing Eastern Time, on August 30, 2005.  By
application of Del.Bankr.L.R. 9006-2, IHS Liquidating's deadline
to file a final report and accounting is automatically extended
through the conclusion of that hearing.

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


INTELIDATA TECH: Posts $1.4 Million Net Loss in Second Quarter
--------------------------------------------------------------
InteliData Technologies Corp. (Nasdaq:INTD) reported financial
results for the three-month and six-month periods ended June 30,
2005.

Revenues for the second quarter of 2005 totaled $2,391,000, a
decrease of $1,355,000 from the $3,746,000 reported for the second
quarter of 2004.

Gross profit for the three-month period ended June 30, 2005
totaled $1,436,000 with a resulting gross margin of 60%.  This
compares to a gross profit of $1,971,000 and a gross margin of 53%
for the same period in 2004.

The net losses for the three-month periods ended June 30, 2005 and
2004, were $1,373,000, and $27,363,000 respectively.  In the
second quarter of 2004, the Company recorded a non-cash goodwill
impairment charge in the amount of $25,771,000 that contributed to
the net loss.  Excluding the impact of the non-cash goodwill
impairment charge, net loss for the second quarter of 2004 would
have been $1,592,000.

Cash and cash equivalents as of June 30, 2005 totaled $733,000,
compared to $1,253,000 as of the beginning of the quarter.  

                     Going Concern Doubt

Because the Company has recurring losses from operations and is
experiencing difficulty in generating cash flow, there is
substantial doubt about its ability to continue as a going
concern.  Management's plans concerning these matters are
described in the quarterly report on Form 10-Q for the period
ended June 30, 2005, filed with the Securities and Exchange
Commission.

With over a decade of experience, InteliData Technologies Corp. --
http://www.InteliData.com/-- provides online banking and  
electronic bill payment and presentment technologies and services
to leading banks, credit unions, financial institution processors
and credit card issuers. The Company develops and markets software
products that offer proven scalability, flexibility and security
in supplying real-time, Internet-based banking services to its
customers.


INTELIDATA TECH: Stockholders to Vote on Merger Pact Next Week
--------------------------------------------------------------
InteliData Technologies Corp. (Nasdaq:INTD) will ask stockholders
to vote on a merger agreement with Corillian Corporation during
its stockholders' meeting scheduled for Aug. 18, 2005.

Under the terms of the agreement, Corillian will issue
approximately 4,918,000 shares of Corillian common stock and will
pay approximately $4,330,000 in cash, subject to adjustment, in
exchange for all the outstanding shares of Intelidata common
stock.  Each outstanding share of the Company's common stock will
be converted into the right to receive approximately 0.0956 shares
of Corillian's common stock and $0.0841 in cash without interest.  
The closing of this transaction is subject to, among other things,
the approval of the Company's stockholders.  

"We are continuing to work with Corillian on a seamless
transition," said Alfred S. Dominick, Jr., Chairman and CEO.  "We
are also joining forces to market the combined company and its
products to existing customers and prospects.  The transition
plans and the coordination efforts are facilitating an orderly
cutover.  We continue to believe that this transaction is in the
best interests of our shareholders, our customers, and our
employees."

With over a decade of experience, InteliData Technologies Corp. --
http://www.InteliData.com/-- provides online banking and  
electronic bill payment and presentment technologies and services
to leading banks, credit unions, financial institution processors
and credit card issuers. The Company develops and markets software
products that offer proven scalability, flexibility and security
in supplying real-time, Internet-based banking services to its
customers.

                        *     *     *

                     Going Concern Doubt

Because the Company has recurring losses from operations and is
experiencing difficulty in generating cash flow, there is
substantial doubt about its ability to continue as a going
concern.  Management's plans concerning these matters are
described in the quarterly report on Form 10-Q for the period
ended June 30, 2005, filed with the Securities and Exchange
Commission.


JUNCOS AL: Case Summary & 10 Largest Unsecured Creditors
--------------------------------------------------------
Debtor: Juncos Al and Construction Corp.
        HC 03 Box 9024
        Juncos, Puerto Rico 00777

Bankruptcy Case No.: 05-07323

Type of Business: The Debtor is a construction company.

Chapter 11 Petition Date: August 9, 2005

Court: District of Puerto Rico (Old San Juan)

Debtor's Counsel: Victor Gratacos Diaz, Esq.
                  Victor Gratacos Law Office
                  P.O. Box 7571
                  Caguas, Puerto Rico 00726
                  Tel: (787) 746-4772

Total Assets: $5,736,600

Total Debts:  $2,582,900

Debtor's 10 Largest Unsecured Creditors:

   Entity                     Nature of Claim       Claim Amount
   ------                     ---------------       ------------
Banco Santander               Credit line debt          $500,000
P.O. Box 362589
San Juan, PR 00936-2589

Banco Bilbao Vizcaya          Credit line debt          $280,000
P.O. Box 364745
San Juan, PR 00936-4745

Logrob Scaffold Equipment     Credit line debt          $212,000
Rental Inc.
P.O. Box 8482
Fernandez Juncos Station
San Juan, PR 00910

Scotiabank                    Credit line debt          $110,000

Popular Auto                  Lease contract for car     $70,000

Criollo Ready Mix Inc.        Credit line debt           $37,000

CASCO                         CSC for vehicle sold       $28,000
                              to third party

Quality Technical             Credit line debt           $28,000
Contractors Inc.

Compresores Y Equipos Inc.    Credit line debt           $10,400

Fabrica De Bloques Vega       Credit line debt             $6000
Baja Inc.


KMART CORP: Settles Lease & Cure Claims Dispute on 10 Stores
------------------------------------------------------------
Kmart Corporation settles disputes on lease rejection claims and
cure claims filed by landlords to various stores:

   Landlord              Store No.   Location
   --------              ---------   ---------
   Heritage SPE LLC         3666     Rockledge, Florida
                            3716     Hermitage, Tennessee
                            3144     Naples, Florida
                            3703     Franklin, Tennessee

   Heritage Property        7670     Charlotte, North Carolina
    Investments Ltd.       
    Partnership   

   Bradley Operating        3759     Baldwin, Mississippi
    Limited Partnership     3719     Burlington, Wisconsin

   Salmon Run Plaza LLC     7432     Watertown, New York

   Jared & Elaine Johnson   4156     Urbandale, Iowa

   Imperial III, LLP        7261     Des Moines, Iowa

Kmart's objections to the Lease Rejection Claims and Cure Claims
are rendered moot.

Headquartered in Troy, Michigan, Kmart Corporation (n/k/a KMART
Holding Corporation) -- http://www.bluelight.com/-- operates
approximately 2,114 stores, primarily under the Big Kmart or Kmart
Supercenter format, in all 50 United States, Puerto Rico, the U.S.
Virgin Islands and Guam.  The Company filed for chapter 11
protection on January 22, 2002 (Bankr. N.D. Ill. Case No.
02-02474).  Kmart emerged from chapter 11 protection on May 6,
2003.  John Wm. "Jack" Butler, Jr., Esq., at Skadden, Arps, Slate,
Meagher & Flom, LLP, represented the retailer in its restructuring
efforts.  The Company's balance sheet showed $16,287,000,000 in
assets and $10,348,000,000 in debts when it sought chapter 11
protection.  Kmart bought Sears, Roebuck & Co., for $11 billion to
create the third-largest U.S. retailer, behind Wal-Mart and
Target, and generate $55 billion in annual revenues.  The
waiting period under the Hart-Scott-Rodino Antitrust Improvements
Act expired on Jan. 27, without complaint by the Department of
Justice.  (Kmart Bankruptcy News, Issue No. 99; Bankruptcy
Creditors' Service, Inc., 215/945-7000)


LAMAR MEDIA: Moody's Rates New $400 Million Sr. Sub. Notes at Ba3
-----------------------------------------------------------------
Moody's Investors Service assigned Ba1 ratings to Lamar Media
Corp.'s $800 million in new senior secured credit facilities due
2012 ($400 million revolving credit facility, $400 million term
loan A) and a Ba3 rating to its proposed $400 million in senior
subordinated notes due 2012.

Additionally, Moody's affirmed all existing ratings at Lamar Media
Corp. and its parent, Lamar Advertising Company, including a Ba2
corporate family rating and SGL-1 speculative grade liquidity
rating.  The proceeds from the transaction will be used to
refinance the existing bank credit facilities and for general
corporate purposes.  The transaction is neutral to leverage.

The ratings and outlook continue to reflect:

   * Lamar's aggressive acquisition strategy;

   * the likelihood that the company will continue to grow through
     strategic acquisition of outdoor advertising assets balanced
     by the company's size and position in its markets; and

   * stable operating performance.

Moody's assigned these ratings:

   Lamar Media Corp.:
   
      -- Ba1 to $400 million revolving credit facility due 2012
      -- Ba1 to $400 million senior secured term loan A due 2012
      -- Ba3 to $400 million senior subordinated notes due 2015
   
Moody's affirmed these ratings:
   
   Lamar Media Corp.:
   
      -- Ba3 on the $385 million senior subordinated notes.
   
   Lamar Advertising Company:
   
      -- the B2 on $287.5 million senior convertible
            notes due 2010,
      -- the company's Ba2 corporate family rating, and
      -- the SGL-1 speculative grade liquidity rating.
   
Additionally, Moody's withdrew its Ba2 ratings on the existing
bank credit facilities.

The outlook remains stable.

The ratings are constrained by:

   * the company's high leverage ($2.3 billion on a lease-adjusted
     basis) and modest fixed charge coverage;

   * ongoing strategy of growing through acquisitions of outdoor
     properties in new and contiguous markets; and

   * the integration risks posed by this strategy.

Additionally, the ratings reflect Lamar's competition with larger
and better capitalized companies in certain key markets (Clear
Channel, Infinity).  Moody's also believes that as industry
consolidation continues, the company may face fewer opportunities
to acquire outdoor assets at attractive prices given the
increasing competition for these assets.  Finally, the rating
incorporates the company's exposure to the cyclical advertising
market.

The ratings continue to reflect:

   * the size and market position of the company's geographically
     diverse outdoor portfolio;

   * its consistently strong margin performance;

   * the high underlying asset value of the company's outdoor
     portfolio; and

   * the durability of the company's predominantly local
     revenue base.

Additionally, the ratings are supported by Moody's belief that
outdoor maintains higher growth prospects as advertisers continue
to shift spending away from traditional mediums (i.e. radio, TV).

The stable outlook incorporates our expectation that Lamar will
continue to finance its acquisition strategy with free cash flow
and in the event of a sizeable acquisition with a prudent mix of
debt and equity.  In the absence of strategic acquisitions,
Moody's expects Lamar to use excess cash flow to reduce debt
instead returning cash to shareholders.  If the company can
successfully integrate its announced and expected future
acquisitions and improve utilization rates that exceed Moody's
expectations, positive ratings momentum may be achieved.

Conversely, distributions to shareholders (in the form of
dividends or share repurchases) or a sizeable debt-financed
acquisition could cause downward ratings pressure.

Pro forma for the refinancing, Moody's expects leverage to remain
at about 4.8 times (measured as Total Lease Adjusted Debt to
Adjusted EBITDA).  Given the company's slowing acquisition
activity and the improvements in performance from the integration
of acquired assets, Moody's believes Lamar has the ability to
organically de-lever over time.

The SGL-1 rating continues to reflect the company's "very good"
liquidity position as projected over the next year.  The SGL-1
rating incorporates the meaningful free cash flow generation,
sizeable flexibility under financial covenants (in excess of a 20%
cushion), and the availability under the company's mostly unused
revolving credit facility (about $200 million available under a
$400 million line).  

The SGL-1 rating also reflects meaningful free cash flow relative
to the company's debt burden, which Moody's estimates at about 12%
of total debt.  This is balanced by Lamar's continued, albeit
slowing, acquisition activity (down from peak of about $300
million a year).  Lamar has historically financed its acquisitions
with a combination of debt and equity.  As of 2Q'05, Lamar
completed $145 million in acquisitions.  Of this amount, $102
million was financed with cash balances and the company's
revolving credit facility.  Additionally, the SGL rating benefits
from the absence of any near-term bank debt amortization.

The Ba1 rating on the senior secured credit facilities reflects
their senior-most position in the capital structure and its first
priority security interest in the capital stock of the company's
subsidiaries.  The one notch differential from the Ba2 corporate
family rating reflects that pro forma for the refinancing the
proportion of senior secured bank debt in the capital structure
has declined to approximately 35%.  The Ba3 rating on the senior
subordinated notes reflects their contractual and effective
subordination to the bank credit facilities as well as the
benefits of subsidiary guarantees.

Moody's research on high yield issuers rated Ba2 and better
reflects that senior subordinated notes do not perform markedly
different when compared to higher ranking debt.  As such, the
subordinated note rating is compressed to only one notch below the
corporate family rating.  The B2 rating on the parent company
senior unsecured convertible notes reflects their structural
subordination to the bank credit facilities and subordinated notes
and the lack of guarantees.

Based in Baton Rouge, Louisiana, Lamar Advertising Company is a
leading owner and operator of outdoor advertising structures in
the U.S. and Canada.


LAMAR MEDIA: S&P Rates Proposed $400 Million Sr. Sub. Notes at B
----------------------------------------------------------------
Standard & Poor's Ratings Services assigned its 'B' rating to
Lamar Media Corp.'s proposed $400 million senior subordinated
notes due 2015.
     
In addition, Standard & Poor's assigned its 'BB' rating and its
'1' recovery rating to Lamar Media's proposed $800 million senior
secured credit facility, reflecting the expectation for full
recovery of principal by lenders in the event of a payment
default.  The proposed senior secured facility, rated one notch
above corporate credit rating, is comprised of a $400 million
revolver due 2012 and a $400 million term loan due 2012.
     
At the same time, Standard & Poor's revised its outlook on Lamar
Advertising Co., Lamar Media's parent, to positive from stable.  
In addition, Standard & Poor's affirmed its 'BB-' corporate credit
rating on the Baton Rouge, Louisiana-headquartered outdoor
advertising company.
      
"The outlook revision reflects improving financial leverage at
Lamar due to low double-digit year-over-year EBITDA growth over
the past year, combined with cash acquisition levels that have
remained within the company's free cash flow generation over the
past several years, leading to modest amounts of debt repayment,"
said Standard & Poor's credit analyst Emile Courtney.

Lease adjusted EBITDA increased 14% to $467 million in the 12
months ended June 2005 largely because of sales growth stemming
from increases in utilization and price levels in the company's
bulletin board and poster ad businesses.  Given expectations for
continued good operating momentum, Lamar has begun to build a
cushion in its leverage profile that could accommodate higher
ratings over the intermediate term.

Standard & Poor's expects high-single digit EBITDA growth, and as
a result, absent a large-scale acquisition, lease adjusted
leverage could strengthen to solidly below 5x over the next year
to 18 months.


LANTIS EYEWEAR: Judge Gropper Confirms Liquidating Chapter 11 Plan
------------------------------------------------------------------
The Honorable Judge Allan L. Gropper of the U.S. Bankruptcy Court
for the Southern District of New York confirmed the Modified
Second Amended Plan of Liquidation jointly filed by Sitnal, Inc.
(fka Lantis Eyewear Corporation) and the Official Committee of
Unsecured Creditor.

As provided in the Plan, Stuart Chizen will be the Wind Down
Officer.  Mr. Chizen will remain employed by the Debtor through
the Effective Date.  He will be paid an amount not to exceed
$100,000 for all services rendered as well as all expenses
incurred in connection with the administration and wind down of
the Debtor's chapter 11 case.  

Joseph Myers of Clear Thinking Group LLC will be the Creditor
Trustee.  Mr. Myers will perform all acts to effectuate the
consummation and implementation of the Plan.

Judge Gropper concludes that:

   1) the Plan complies with all applicable provisions of the
      Bankruptcy Code, including Sections 1122 and 1123, and
      Sections 1129(a)(1) and 1129(a)(2);

   2) the Plan satisfies the requirements of Section 1129(a)(11)
      of the Bankruptcy Code by providing for the creation of the
      Disputed Class 3 Claims Reserve by the Creditor Trustee,
      which will consist of cash held in reserve, for the benefit
      of the holders of Disputed Claims;

   3) the Plan satisfies the requirements of Section 1129(a)(7)(A)
      of the Bankruptcy Code because holders of Claims will
      receive more than they would receive if the Debtor were
      liquidated under a Chapter 7 proceeding;

   4) the Plan satisfies the requirements of Section 1129(a)(9) of
      the Bankruptcy Code by providing for the full payment of
      Allowed Administrative Claims, Allowed Priority Claims and
      Allowed Other Priority Claims.

Under the Plan, on the Effective Date:

   a) the existing Board of Directors of the Debtor and any
      remaining officers of the Debtor will be dismissed;

   b) the Official Committee of Unsecured Creditors will be
      dissolved and its members will be released and discharged
      from all further duties and obligations arising from or
      related to the Debtor's chapter 11 case.

   c) the Foreign Assets are deemed abandoned.  The Foreign Assets
      are investments in equity interest or stock of:

      1) Ottava Rima Investments B.V.;

      2) wholly-owned subsidiaries of Ottava Rima Investments
         B.V., consisting of Lantis Eyewear Europe B.V., Lantis
         Eyewear International B.V. and Lantis Eyewear France
         SAS; and

      3) Lantis Eyewear Germany GmbH, a wholly-owned subsidiary of
         Lantis Eyewear Europe B.V.;

   d) all remaining assets of the Debtor will be vested, conveyed,
      assigned and transferred to the Creditor Trust;

   e) the Debtor will transfer the possession and control of the
      Administrative and Priority Claims Fund to the Creditor
      Trustee;

   d) HIG Recovery Fund II, Inc., will pay:

      * $156,000 to the Creditor Trustee; and
      * all U.S. Trustee Fees through the Effective Date.

HIG will be entitled to receive and retain refunds due under
insurance policies held by the Debtor, but consistent with the
Sale Order and related and ancillary documents, the Creditor
Trust will receive any tax refunds payable to the Debtor.

A full-text copy of the Modified Second Amended Plan of
Liquidation jointly filed by Sitnal, Inc., fka Lantis Eyewear
Corporation and the Official Committee of Unsecured Creditor is
available for a fee at http://researcharchives.com/t/s?b9

Headquartered in New York, Lantis Eyewear Corporation nka Sitnal,
Inc. -- http://www.lantiseyewear.com/-- is a leading designer,  
marketer and distributor of sunglasses, optical frames and related
eyewear accessories throughout the United States.  The Company
filed for chapter 11 protection on May 25, 2004 (Bankr. S.D.N.Y.
Case No. 04-13589).  Jeffrey M. Sponder, Esq., at Riker, Danzig,
Scherer, Hyland & Perretti LLP, represents the Debtor.  When the
Debtor filed for protection from its creditors, it listed
$39,052,000 in total assets and $132,072,000 in total debts.


MARKWEST ENERGY: Earns $700,000 of Net Income in Second Quarter
---------------------------------------------------------------
MarkWest Energy Partners, L.P. (Amex: MWE) reported net income of
$700,000 for the three months ended June 30, 2005, compared to net
income of $3.3 million, for the second quarter of 2004.

On July 21, 2005, the board of directors of the general partner of
MarkWest Energy Partners, L.P., declared the Partnership's
quarterly cash distribution of $0.80 per unit for the second
quarter of 2005.  The second quarter distribution is payable
August 15, 2005 to unitholders of record on August 9, 2005

As a Master Limited Partnership, cash distributions to limited
partners are largely determined based on Distributable Cash Flow.
For the three months ended June 30, 2005, DCF was $7.7 million,
compared to $6.4 million for the three months ended June 30, 2004.

The change in second quarter net income compared to 2004 was
primarily attributed to:

    * Expenses incurred in our testing and repair program on the
      Appalachian Liquids Pipeline System as well as additional
      trucking costs for moving product while the line is out of
      service;

    * Decreased liquids fractionation in Appalachia, primarily due
      to upstream interruptible customer curtailments in 2005;

    * Increased SG&A expense related to ongoing audit and
      compliance requirements and non-cash compensation expense;

    * Reduced throughput volumes on our systems in Michigan due to
      the expected decline in oil and natural gas production;

    * Higher interest expense related to increased borrowing to
      fund acquisitions.

    On the positive side these items were partially offset by the
    following:

       * The addition of our East Texas assets.  We did not
         acquire these assets until the third quarter of 2004.
       * The addition of our interest in Starfish Gathering
         Company, LLC, which we acquired in the first quarter of
         2005.
       * Improved gathering volumes on our Appleby and Western         
         Oklahoma systems compared to the prior year.
       * Improved processing margins relative to the prior year.
       * Higher NGL and gas prices on our equity gallons and
         volumes.

The ALPS incremental trucking costs, testing and repairs expenses
for the quarter totaled $2.3 million.  The ALPS expenses mentioned
above will continue into the third quarter as we finalize testing
and repair of the pipeline.

Second quarter results also include an approximate $0.8 million
non-cash charge associated with the compensation expense from the
Participation Plan, whereby compensation expense is allocated to
the Partnership from its parent company, MarkWest Hydrocarbon,
Inc. for the sale of interests in the Partnership's general
partner to certain of their employees and directors.  This
represents a $700,000 increase over the second quarter of 2004.

"This was an unusual quarter for us in that most of the shortfall
in expected cash flow was attributable either to one-time expenses
or expenses that will be concluded in the third quarter," said
Frank Semple, President and CEO.

Mr. Semple added, "On the positive side I am very pleased that
several key factors affected the quarter, which we believe will
continue for the foreseeable future.  First, our East Texas
assets, which we acquired last year, are performing well and the
construction of our new Carthage processing plant is on schedule
for start-up January 1, 2006.  We have identified and are building
in excess of $20 million of new internal growth projects at our
East Texas, Oklahoma and Appleby systems.  Both our Appleby and
Western Oklahoma assets continue to expand as high quality
drilling opportunities behind these systems are exploited by our
producer customers.  As an example, we now have 120 wells
connected to our Appleby system and one of our producer customers
has identified more than 500 drilling locations on its acreage
alone.  Finally, our Starfish acquisition in March of this year is
performing well and we, with our partner in that system, are
actively pursuing new expansion opportunities as wells are being
drilled in the deep water Gulf of Mexico."

MarkWest Energy Partners, L.P. is a publicly traded master limited
partnership with a solid core of midstream assets and a growing
core of gas transmission assets.  It is the largest processor of
natural gas in the Northeast and is the largest gas gatherer of
natural gas in the prolific Carthage field in east Texas.  It also
has a growing number of other gas gathering and intrastate gas
transmission assets in the Southwest, primarily in Texas and
Oklahoma.

                        *     *     *

As reported in the Troubled Company Reporter on May 11, 2005,   
Standard & Poor's Rating Services placed its 'B+' corporate credit
rating on MarkWest Energy Partners L.P. on CreditWatch with
negative implications after the company's announcement that its   
Form 10-K filing would be further delayed and that it would be
required to restate its 2002 through 2004 financial statements.   

MWE has not filed its Form 10-K on time as a consequence of
identifying material weaknesses under Section 404 of the Sarbanes-
Oxley Act, primarily involving reporting processes in its
Southwest business unit.  In addition, both MWE and MarkWest   
Hydrocarbon Inc., the majority interest holder in MWE's general
partner, have now determined that they must file restatements for
2002 through 2004 to reflect compensation expense for the sale of
interests in MWE's general partner.   

"The CreditWatch listing reflects concern about repeated and
protracted delays in the company's Form 10-K filing, uncertainty
about the magnitude of impending restatements, the possibility
that further delays could reduce the partnership's liquidity, and
the risk of material weaknesses being greater in scope than
expected," said Standard & Poor's credit analyst Plana Lee.   

MWE has obtained covenant waivers from its banks under its
revolving credit facilities until June 30, 2005.  The company was
previously granted a waiver through April 30, 2005, which it was
unable to meet.   

MWE has also received an extension to regain compliance from the   
American Stock Exchange until May 31, 2005, having missed its
previous May 2 deadline.


MCI INC: Will Acquire Totality Corp.
------------------------------------
MCI, Inc. (NASDAQ: MCIP) reported that it has agreed to acquire
Totality Corp., a San Francisco-based provider of remote managed
services for business-critical applications and infrastructure.  
The transaction is expected to close within 45 days and terms were
not disclosed.

"With this acquisition, MCI is able to combine its core hosting
capabilities with proven expertise in the applications management
space, further accelerating its ability to keep pace with
enterprise and business customers as they transition to IP," said
Jonathan Crane, MCI executive vice president and chief strategy
officer.  "This combination will enable MCI to deliver more fully
integrated communications services to customers, while better
supporting their advanced IP and complex IT requirements."

The acquisition builds on MCI's expertise in managing applications
within its Enterprise Hosting business, extending MCI's managed
hosting capabilities to provide application management support
outside of MCI-managed hosting centers.  With Totality's
capabilities, MCI will be able to manage and monitor a customer's
applications no matter where they are hosted, resulting in the
delivery of integrated communications services from the network to
the application layer to more fully support critical customer
processes and applications.

                          About Totality

Totality is a leading 24x7 remote managed services provider for
business-critical applications and infrastructure. Totality
delivers Guaranteed Business Outcomes through line-of-business
focused Service Level Agreements that provide customers with a
high degree of performance and business process visibility.
Totality manages applications and infrastructure for blue-chip
companies such as American Airlines, Best Buy, EquiLend,
Scholastic, Sony and The Sharper Image. Systems under management
account for over $3 Billion (B2C) and over $1 Trillion (B2B) in
annual revenue and transactions.

Founded in 1999, Totality is a privately held company,
headquartered in San Francisco, California with offices in New
York, Chicago and Dallas. For more information, visit
http://www.totality.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. 96; 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.


MCLEODUSA INC: June 30 Balance Sheet Upside-Down by $380 Million
----------------------------------------------------------------
McLeodUSA Incorporated reported financial and operating results
for the quarter ended June 30, 2005.

Total revenues for the quarter ended June 30, 2005 were $159.7
million compared to $160.5 million in the first quarter of 2005
and $191.9 million in the second quarter of 2004.  In the second
quarter of 2005, long distance and local revenue per customer
increased slightly due to higher wholesale volume and private line
and data revenue per customer increased by 1.2%, however, these
increases were offset by a reduction in total customers for the
quarter.

Gross margin for the second quarter of 2005 was $67.5 million
compared to $67.2 million in the first quarter of 2005 and $86.6
million in the second quarter of 2004.  Gross margin as a
percentage of revenue for the second quarter was 42.3%, compared
with 41.9% in the first quarter of 2005 and 45.1% in the second
quarter of 2004.  Gross margin in the second quarter of 2004
included various favorable settlements of approximately $6
million.

SG&A expenses for the second quarter of 2005 were $53.7 million
compared to $56.7 million in the first quarter of 2005 and $68.5
million in the second quarter of 2004 as the Company continues to
realize the benefits of its ongoing process improvement programs
and other actions taken to reduce non-essential expenses.  

Consistent with the Company's current focus on a capital
restructuring and in accordance with certain accounting standards
and prescribed procedures, the Company performed analyses related
to the deemed recoverability of its property and equipment and
carrying value of selected intangible assets.  As a result, a non-
cash impairment charge of $202.5 million was recorded in the
second quarter.  Net loss for the second quarter of 2005,
including the impairment charge, was $268.0 million, versus a net
loss of $97.5 million in the first quarter of 2005 and a net loss
of $82.2 million in the second quarter of 2004.

The Company's excellent operational performance continued in the
second quarter of 2005.  The customer satisfaction rating for the
quarter was 95%, billing accuracy remained at 99.9% and the
Company continued to consistently achieve 99.999% network
reliability, all in line with Company goals.

Customer platform mix at the end of the second quarter was 74%
UNE-L, 4% resale and 22% UNE-P versus 69%, 4% and 27%,
respectively, at the end of the second quarter of 2004.  Business
customer line turnover was 2.2% in the second quarter of 2005
compared to 2.0% in the first quarter of 2005 and 2.2% in the
second quarter of 2004.  Total customer line turnover in the
second quarter was 2.3% versus 2.1% in the first quarter of 2005
and 2.5% in the second quarter of 2004.

The Company ended the quarter with $33.4 million of cash on hand.
Total capital expenditures for the second quarter of 2005 were
$9.1 million principally in support of the Company's VoIP Dynamic
Integrated Access rollout and sustaining the existing voice and
data networks.  The Company was in full compliance with the terms
of the forbearance agreement with its lenders in the second
quarter of 2005.

                  Capital Restructuring

As recently announced, the Company and its lenders agreed to
extend until September 9, 2005 the forbearance agreement initially
entered into on March 16, 2005 and previously extended to July 21,
2005.  Under the terms of the forbearance agreement, the lenders
continue to agree not to take any action as a result of non-
payment by the Company of certain principal and interest payments
due on or before September 9, 2005 or any related events of
default that occur through September 9, 2005.

As previously announced, the Company is working with its lenders
to effectuate a capital restructuring where the lenders would
convert a substantial portion of their debt to equity and become
the Company's stockholders.  None of the restructuring
alternatives under evaluation provide any recovery for the
Company's current preferred or common stockholders.

Therefore, the Company does not expect holders of its preferred or
common stock to receive any recovery in a capital restructuring.
In addition, there can be no assurance that the Company will be
able to reach an agreement with its lenders regarding a capital
restructuring on terms and conditions acceptable to the Company
prior to the end of the forbearance period on September 9, 2005.

In accordance with the forbearance agreement, as of June 30, 2005,
the Company has elected not to make $15.6 million of scheduled
principal amortization and $23.1 million of scheduled interest
payments.  The forbearance agreement, among other things, limits
the Company's ability to sell certain assets without prior
approval of the lender group and requires the Company to accrue
two additional percentage points of interest on the outstanding
loan balance.  The Company's debt has been classified as current
in the condensed consolidated balance sheet because the default is
not expected to be cured by September 9, 2005, the date the
forbearance agreement ends, and the forbearance agreement does not
extend beyond one year from the balance sheet date.

The Company continues to believe that by not making principal and
interest payments on the credit facilities, cash on hand together
with cash flows from operations are sufficient to maintain
operations in the ordinary course without disruption of services
or negative impact on its customers or suppliers.  McLeodUSA
remains committed to continuing to provide the highest level of
service to its customers and to maintaining its strong supplier
relationships.

McLeodUSA Inc. -- http://www.mcleodusa.com/-- provides integrated  
communications services, including local services, in 25 Midwest,
Southwest, Northwest and Rocky Mountain states.  The Company is a
facilities-based telecommunications provider with, as of June 30,
2005, 38 ATM switches, 38 voice switches, 698 collocations, 432
DSLAMs and approximately 2,072 employees.

At Jun. 31, 2005, McLeodUSA Inc.'s balance sheet showed an
$84,715,000 stockholders' deficit, compared to a $63,941,000
deficit at Dec. 31, 2004.


METALLURG INC: Prepays $18.4 Million of Term Loan
-------------------------------------------------
Metallurg, Inc., prepaid its term loan with MHR Institutional
Partners II LP, as agent with cash on hand, on August 1, 2005.  
The total payment of $18.4 million included $15.0 million of
original principal, $1.4 million of interest paid-in-kind that was
added to principal and $2.0 million of prepayment penalty.  
Metallurg continues to maintain the $21.0 million letter of credit
facility under the financing agreement with MHR.

In addition, on August 3, 2005, Metallurg's parent company,
Metallurg Holdings, Inc., has commenced discussions with Morgan
Stanley to explore financing alternatives aimed at refinancing
long term, interest-bearing obligations.

Metallurg, headquartered in New York City, is a leading
international producer of high quality metal alloys and specialty
metals used by manufacturers of steel, aluminum, superalloys,
chemicals, and other metal consuming industries.

                         *     *     *

As reported in the Troubled Company Reporter on June 13, 2005,
Moody's Investors Service raised the ratings of Metallurg, Inc.
and its parent Metallurg Holdings, Inc.

These ratings were upgraded:

  Metallurg Holdings, Inc.:

   * senior implied rating, to Caa1 from Caa3;

   * $40.3 million of 12.75% senior discount notes, Series B, due
     July 15, 2008, to Ca from C; and

   * issuer rating, to Ca from C.

  Metallurg, Inc.:

   * $100 million of 11% guaranteed senior notes, Series B, due
     December 1, 2007, to Caa2 from Ca.


MORGAN STANLEY: Increased Subordination Cues Fitch to Lift Rating
-----------------------------------------------------------------
Fitch Ratings upgrades Morgan Stanley Capital I, Inc.'s commercial
mortgage pass-through certificates, series 1997-HF1:

     -- $41.7 million class F to 'BBB+' from 'BBB';
     -- $4.6 million class G to 'BBB-' from 'BB+'.

In addition, Fitch affirms these certificates:

     -- Interest-only class X 'AAA';
     -- $44.8 million class B 'AAA';
     -- $34.0 million class C 'AAA';
     -- $27.8 million class D 'AAA';
     -- $9.3 million class E 'AAA';
     -- $10.8 million class H 'B'.

The $7.7 million class J remains at 'CCC'.  Fitch does not rate
the $4.0 million class K certificates.

The upgrades to classes F and G is the result of increased
subordination due to loan payoffs and amortization.  As of the
July 2005 distribution date, the pool's collateral balance has
been reduced 70%, to $184.8 million from $616.4 million at
issuance.

One loan (2.2%) is currently 90 days delinquent and being
specially serviced.  The loan is secured by a healthcare property
located in East Northport, NY.  The special servicer, GMAC
Commercial Mortgage Corp., is currently determining a workout
strategy and losses are expected, as the appraisal valued the
property significantly less than the loan balance.


NORTEL NETWORKS: Posts $45 Million Net Income in Second Quarter
---------------------------------------------------------------
Nortel Networks Corporation (NYSE:NT)(TSX:NT) reported results for
the second quarter of 2005 in U.S. dollars and in accordance with
accounting principles generally accepted in the United States.

"Our results demonstrate progress against our strategic plan.  I
am pleased that our strategic objectives of cash, costs and
revenue combined with a strong focus on our business operations
and execution are delivering solid results," said Bill Owens, vice
chairman and chief executive officer, Nortel.  "We are playing to
win, and Nortel's commitment is to long-term value, not just
short-term gain.  This should be apparent as we continue to
increase our investment in our enterprise business, evolve our
product portfolio and build new businesses.  We are driving our
investment strategy to maintain our technology and market
leadership in our chosen markets around the world."

                   Second Quarter 2005 Results

Revenues were $2.86 billion for the second quarter of 2005
compared to $2.59 billion for the second quarter of 2004 and
$2.54 billion for the first quarter of 2005.  The Company reported
net earnings in the second quarter of 2005 of $45 million, or
$0.01 per common share on a diluted basis, compared to net
earnings of $16 million, or $0.00 per common share on a
diluted basis, in the second quarter of 2004 and a net loss of
$49 million, or ($0.01) per common share on a diluted basis, in
the first quarter of 2005.

Net earnings in the second quarter of 2005 included special
charges of $90 million related to restructuring activities and
$39 million of costs related to the sale of businesses and assets.
The second quarter 2005 results included adjustments related to
prior periods, which reduced net earnings by approximately
$40 million ($16 million of which was included in the costs
related to the sale of businesses and assets) and resulted in a
$0.01 reduction in basic and diluted earnings per common share.

            Breakdown of Second Quarter 2005 Revenues

Carrier Packet Networks revenues were $743 million, an increase of
3 percent compared with the year-ago quarter and an increase of
12 percent sequentially.  Enterprise Networks revenues were
$730 million, an increase of 26 percent compared with the year-ago
quarter and an increase of 33 percent sequentially.  GSM and UMTS
Networks revenues were $719 million, an increase of 1 percent
compared with the year-ago quarter and a decrease of 9 percent
sequentially.  CDMA Networks revenues were $662 million, an
increase of 17 percent compared with the year-ago quarter and an
increase of 24 percent sequentially.

                          Gross Margin

Gross margin was 43 percent of revenue in the second quarter of
2005. The performance was in line with our expected range of 40 to
44 percent of revenue.

               Selling, General and Administrative

SG&A expenses were $579 million in the second quarter of 2005,
which included a cost of $59 million in relation to restatement
activities and investment in the Company's finance organization.   
This compares to SG&A expenses of $542 million for the second
quarter of 2004 and $574 million for the first quarter of 2005.   
The first quarter of 2005 SG&A expenses included a cost of
$66 million related to restatement activities and investment in
the Company's finance organization.

                    Research and Development

R&D expenses were $479 million in the second quarter of 2005,
compared to $493 million for the second quarter of 2004 and
$474 million for the first quarter of 2005.

                     Other Income (expense)

Other income -- net was $58 million income for the second quarter
of 2005, which primarily related to the gain on the sale of an
investment of $21 million, the gain on a contract settlement of
$17 million and interest income of $15 million.

                             Cash

Cash balance at the end of the second quarter of 2005 was
$3.06 billion, down from $3.43 billion at the end of the first
quarter of 2005.  This decrease in cash was primarily driven by a
cash outflow from investing activities of $409 million, which was
partially offset by a cash inflow from continuing operating
activities of $104 million.  The investing activities included a
payment of $423 million, net of cash acquired, for the acquisition
of PEC Solutions, Inc., and the operating activities included cash
payments for restructuring of $63 million.

                     First Half 2005 Results

For the first half of 2005, revenues were $5.39 billion compared
to $5.03 billion for the same period in 2004.  The Company
reported a net loss for the first half of 2005 of $4 million, or
$0.00 per common share on a diluted basis, compared to net
earnings of $75 million, or $0.02 per common share on a diluted
basis, for the same period in 2004.

Net earnings in the first half of 2005 included special charges of
$111 million related to restructuring activities and $39 million
of costs related to the sale of businesses and assets.  The first
half 2005 results included adjustments related to prior periods
which reduced net earnings (loss) by approximately $35 million
($6 million of which was included in the costs related to the sale
of businesses and assets) and resulted in a $0.01 reduction in
basic and diluted earnings (loss) per common share.

                             Outlook

Commenting on the Company's outlook, Owens said, "This quarter's
improved financial performance and positive momentum is proof that
Nortel is strong, our business is building and our results are
heading in the right direction.  The management team and I look
forward to continuing to build on our progress throughout the
coming quarters.  For the full year 2005 compared to 2004, we
expect revenue to grow in the range of 10 percent while reflecting
a seasonal pattern.  We continue to expect gross margins to be in
the range of 40 to 44 percent of revenue and operating expenses as
a percent of revenue to be approximately 35 percent by the end of
the year."

                   Recent Business Highlights

Revenue Momentum

   -- Nortel's wireless momentum continued globally with new
      contracts and deployments for high speed mobile data
      services, and 3G mobile voice and data solutions highlighted
      by Bell Mobility, Orange France, Telefonica Moviles Espana,
      SaskTel Mobility, Telesur, and Liberia's Cellcom.

   -- The City of San Jose launched broader and more secure access
      to city services for its citizens, and 'anywhere, anytime'
      interaction with city officials using advanced communication
      capabilities powered by solutions from Nortel delivered on
      time and on budget.

   -- Building on the more than 100 million users worldwide of
      Nortel secure connectivity technology, the deployment for
      Sabre Holdings of an enterprise-wide solution for Internet-
      based travel agent connectivity is one of the largest SSL
      VPN deployments in the world to date.

   -- Continuing on Nortel's more than 15 year relationship with
      BT with their selection of Nortel's Communication Server
      (CS) 2000 carrier class voice over IP call server solution
      to enable the delivery of an IP-based business voice
      solutions aimed at large public and private sector
      organizations, and BT's plans to upgrade their consumer and
      business contact centre organization with Nortel Centrex IP
      enhancing the user experience for its 20 million UK
      customers.

   -- Nortel announced next-generation SONET/SDH deployments of
      the OME 6500 by Tiscali Italia in Italy and Impsat Fiber
      Networks in Argentina for converged infrastructure triple
      play applications and by China Mobile in China and Telesur
      in Suriname for wireless backhaul infrastructure
      optimization.  Nortel's optical technology leadership
      continued to build with the introduction of enhanced
      Reconfigurable Optical Add Drop Multiplexing (eROADM) and
      electronic Dynamically Compensating Optics (eDCO) that are
      designed to significantly extend wavelength distances and
      enable reduced network planning and engineering costs.

Leading Next-Generation Solutions

   -- Continued technology leadership with High Speed Downlink
      Packet Access (HSDPA) wireless broadband live network trials
      with Partner in Israel and BB Mobile in Japan, believed the
      first in each respective country.  This builds on Nortel's
      work with a number of wireless operators on HSDPA trials and
      deployments in 2005 including mm02, Orange, Vodafone and
      Mobilkom Austria.

   -- Nortel announced the introduction of a new multimedia
      communications plug-in for Microsoft Office Outlook 2003
      bringing the power of integrated voice, video and text
      messaging to the mass market of business communication users
      and enabling a new type of converged application which will
      add rich new communications capabilities to the large base
      of Outlook users.

   -- Customer deployments and contracts across the healthcare and
      government vertical market segments of Nortel's innovative
      and globally deployed Wireless Mesh Network solution by the
      City of Richardson Texas, Royal Ottawa Hospital, National
      Aeronautics and Space Administration (NASA), Taipei City
      Hospital and the City of Taipei Mobile City Project.

New Business Partnerships

   -- Nortel completed the acquisition of PEC Solutions, Inc., and
      created a U.S. entity that operates under the name Nortel
      PEC Solutions.  Demonstrating immediate results of this
      organization was the deployment of a Nortel Wireless Mesh
      Network at NASA's Kennedy Space Center.  In addition, the
      NASA Mission Command and Telemetry Network was also upgraded
      by Nortel, the same network that also supports the Mars
      Rover, the Hubble Telescope, and other NASA programs.

   -- Nortel signed a shareholders agreement with Unisystems to
      establish a joint venture named Uni-Nortel for sales,
      marketing and support of Nortel's leading-edge
      telecommunications equipment and networking solutions in
      Greece and Cyprus.

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

                         *     *     *   

As reported in the Troubled Company Reporter on July 8, 2005,  
Moody's Investors Service confirmed the ratings of Nortel Networks
Corporation (holding company) and Nortel Networks Limited
(principal operating subsidiary and debt guarantor).  The ratings
confirmation concludes a ratings review for possible downgrade
under effect since April 28, 2004.  Moody's also assigned a new
Speculative Grade Liquidity rating of SGL-3 to Nortel, reflecting
adequate liquidity to fund debt maturities and other cash outflows
over the next 12 months.  The ratings outlook is negative.

The ratings confirmed include:

     Nortel Networks Corporation:

        -- Senior Secured rating at B3 (guaranteed by Nortel
           Networks Limited)

     Nortel Networks Limited:

        -- Corporate Family Rating (formerly known as the Senior
           Implied rating) at B3

        -- Senior Secured rating at B3

        -- Issuer rating (senior unsecured) at Caa1

        -- Preferred Stock rating at Caa3

     Nortel Networks Capital Corporation:

        -- Senior Secured rating at B3 (guaranteed by Nortel
           Networks Limited).

This new rating was assigned:

   -- Speculative Grade Liquidity rating of SGL-3.

As reported in the Troubled Company Reporter on Jan. 31, 2005,   
Standard & Poor's Ratings Services affirmed its 'B-' credit rating   
on Nortel Networks Lease Pass-Through Trust certificates series   
2001-1 and removed it from CreditWatch with negative implications,   
where it was placed Dec. 8, 2004.   

The affirmation was based on a valuation analysis of properties   
that provide security for the two notes that serve as collateral   
for the pass through trust certificates.   

The initial rating on the securities relied upon the ratings   
assigned to both Nortel Networks Ltd. and ZC Specialty Insurance   
Co.  The Dec. 8, 2004, CreditWatch placement followed the   
Dec. 3, 2004 withdrawal of the rating assigned to ZC.


NRG ENERGY: Earns $23.9 Million of Net Income in Second Quarter
---------------------------------------------------------------
NRG Energy, Inc. (NYSE:NRG) reported net income for the quarter
ended June 30, 2005 of $23.9 million, including $700,000 related
to discontinued operations.  This compares with net income of
$83.0 million, in the same period in 2004, which included $13.6
million related to discontinued operations.

For the six months ended June 30, 2005, NRG reported net income of
$46.5 million, including $0.7 million related to discontinued
operations.  This compares with $113.3 million in 2004, which
included income of $12.4 million related to discontinued
operations.

Lower net income, primarily from West Coast Power, asset sales and
reduced generation due to outages were partially offset by reduced
interest expenses and a lower effective tax rate.  The second
quarter of 2004 included a $38.5 million pretax Connecticut Light
& Power settlement gain.  Mark-to-market charges associated with
our hedging activity included a $5.1 million gain and a $33.1
million loss, respectively, for the three and six months ended
June 30, 2005.  The year-to-date results were also affected by
approximately $60 million of mark-to-market gains related to
forward electricity sales in the Northeast that were recorded at
the end of 2004, approximately $51 million settled through June
30, 2005.

"While certain of our assets, such as our New York City plants,
were called upon and performed at record levels, outages at
several of our coal-fired units impacted our quarterly results,"
commented David Crane, NRG President and Chief Executive Officer.
"This quarter's operating result illustrates the timeliness and
importance of our business improvement program, F.O.R.NRG,
announced last quarter."

            Accelerated Share Repurchase Program

NRG has committed to repurchase, today, August 11, 2005, $250
million of the Company's outstanding common stock from an
affiliate of Credit Suisse First Boston LLC.  The Company will
fund the planned repurchase with existing cash balances.  To
enable this share repurchase under the Company's high yield debt
indenture, the Company will issue simultaneously in a private
transaction, $250 million of perpetual preferred stock.  The cash
proceeds from the preferred issuance will be used to repurchase
approximately $229 million of our 8% high yield notes at 108% of
par which will bring the total amount of our 8% notes redeemed
during 2005 to $645 million.

"This accelerated share repurchase and the partial redemption of
our 8% notes are both part of our continuing capital allocation
program and underscore our commitment to the efficient deployment
of capital," said Crane.  "While we expect over time to reinvest
the lion's share of our capital in enhancing our asset portfolio,
NRG's exceptional balance sheet strength and liquidity combined
with our projected free cash flow generation has caused us to
conclude that, at this time, using a portion of our retained cash
to repurchase our shares and bonds is a prudent and efficient use
of capital."

              Liquidity and Capital Resources

Liquidity remained strong at $1.2 billion, as of June 30, 2005,
even after the Company paid down $473.0 million in debt during the
first and second quarter.  This cash outflow was partially offset
by the first quarter 2005 collection of the $71 million TermoRio
arbitration award, an April 2005 $50 million dividend distribution
from WCP, the $64.6 million in Enfield sale proceeds and cash from
operations.

The Company continuously monitors its capital structure,
liquidity, and cash flow and has been assessing for several months
how to optimize the utilization of its current cash resources.  
The planned capital transaction is designed to provide a cost
effective return of capital to shareholders, with certainty of
execution, while preserving the Company's flexibility for future
capital allocation decisions.  Upon completion of this
transaction, the Company's net debt to total capital remains at
approximately 47%, the lower end of our targeted range.

On August 8, the Company executed a commitment to sell to CSFB, in
a private placement, $250 million in new 3.625% perpetual
preferred stock.  The preferred stock may be settled at the option
of CSFB or the Company during a 90 day period commencing August
11, 2015.  Upon settlement, NRG will pay CSFB $250 million in cash
to redeem the preferred stock.  If the market value of the
underlying NRG common shares is in excess of 150% of the August
10, 2005 issuance price, NRG will pay CSFB the net difference in
cash or shares at settlement.  If the Company's common share price
is lower at settlement than the issuance price, CSFB will pay NRG
the net difference in cash or shares.  Only common shares equal to
the value of the security in excess of 150% of the issuance price
will be included in the earnings per share dilution calculation.

Issuing the preferred stock also gives NRG the capacity under its
debt instruments to use existing cash to fund the accelerated
share repurchase program announced today.  Under the terms of the
accelerated share repurchase agreement with CSFB, NRG will have
fixed its price risk under the program at 97% - 103% of the common
share price at execution.  NRG's outstanding shares will decrease
by the full amount repurchased on August 11, 2005 based on NRG's
August 10, 2005 closing price.

               Focus on Return on Invested Capital

During the first quarter earnings call, NRG announced F.O.R.NRG, a
comprehensive cost and margin improvement program consisting of a
large number of asset, portfolio and headquarters-specific
initiatives being implemented over the short-to-medium term.  The
Company's improvement plan will contribute $100 million annually
by the end of 2008, and $30 million in benefits are expected in
2005.  Approximately $18 million of benefits were achieved during
the second quarter.

The Company currently has approximately 85 projects that are
either scheduled for implementation or are under technical and
financial evaluation.  Currently we have over 20 projects in
active implementation as part of F.O.R.NRG.

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

                         *     *     *   

Moody's Investor Services and Standard & Poor's assigned single-B
ratings to NRG Energy's 8% secured notes due 2013.


OCCAM NETWORKS: June 30 Balance Sheet Upside-Down by $18 Million
----------------------------------------------------------------
Occam(R) Networks Inc. (OTCBB: OCCM) reported results for the
second quarter of 2005, which ended June 30, 2005.

The company reported revenue for the quarter of $8.7 million,
setting a new company record for the fourth consecutive quarter.
Second-quarter 2005 revenues represented an increase of 26 percent
over the $6.9 million reported for the first quarter of 2005, and
a 174 percent increase over the $3.2 million reported for second
quarter of 2004.  The company also added more than a dozen new
customers for the fourth consecutive quarter, bringing the
company's total number of customers to 100.

"The second quarter was another solid quarter for Occam -- we
added our 100th customer, grew revenues, announced several
significant new products, and increased the awareness and
visibility of Occam in our target markets," said Bob Howard-
Anderson, president and CEO of Occam Networks.  "Our continued
success demonstrates the growing acceptance by Telcos that
Ethernet and IP are superior technologies for building simple,
cost-effective access networks for delivering new services,
especially Triple Play."

Occam gained more than a dozen new customers during the second
quarter of 2005, including Farmers Telephone Cooperative Inc., the
nation's third largest telephone cooperative.  Farmers selected
the Occam BLC 6000(TM) System to build the broadband network that
will deliver Triple Play services, voice, video, and high-speed
data, to its 60,000 subscribers in eastern South Carolina.

During the quarter, the company enhanced the capabilities of its
flagship BLC 6000 System with the announcement of fiber to the
home functionality, and the delivery of an Emergency Stand Alone
feature, as well as other upgrades to the BLC 6000's system.  The
company's BLC 6312 Optical Line Termination blade and ON 2240
Optical Network Terminal are targeted to be the industry's first
products to deliver up to one gigabit per second of bandwidth to
the subscriber premise, providing a cost-effective alternative,
with much higher subscriber bandwidth, than passive optical
networks.  With the addition of the ESA feature, the BLC 6000
System became the first broadband loop carrier to provide
emergency services calling and local station-to-station calling
during network or equipment failures, enabling Telcos to deploy
Ethernet and IP technologies and continue to meet FCC requirements
to provide lifeline POTS.

Additionally the company upgraded the BLC 6000 System to include
support for several new ADSL2Plus features including copper pair
bonding, for maximizing ADSL speeds over copper telephone lines,
symmetrical DSL services for business customers, long-reach DSL
for customers beyond 18,000 feet, and Seamless Rate Adaptation, as
well as other new features.  The upgrade provides Telcos with the
first commercially available standards-based implementation of
ADSL2Plus bonding, Reach Extended and Symmetrical Services.

Company gross margins for the quarter were lower as a percent of
revenue for three reasons:

    1) The completion and revenue recognition of a large Rural
       Utilities Service contract that shipped in 2004, prior to
       recent improvements made in product costs, had much lower
       margins than shipments made during Q2;

    2) Lower Operations overhead absorption due to the continued
       decrease in inventory levels; and

    3) A downward revaluation of inventory on hand from prior
       quarters to adjust for the lower cost of product received
       in Q2.

"We are pleased that we continued our trend of decreasing product
costs and inventory levels in the quarter, even though it
negatively affected Gross Margins in closing Q2," said Howard-
Anderson.  "In addition to lowered product costs and inventories,
additional capital raised in the quarter left us with an overall
healthier balance sheet."

Occam Networks Inc. -- http://www.occamnetworks.com/-- develops  
and markets innovative Broadband Loop Carrier networking equipment
that enable telephone companies to deliver voice, data and video
services.  Based on Ethernet and Internet Protocol technologies,
Occam's equipment allows telecommunications service providers to
profitably deliver traditional phone services, as well as advanced
voice-over-IP, residential and business broadband, and digital
television services through a single, all-packet access network.
Occam is headquartered in Santa Barbara, Calif.

At Jun. 30, 2005, Occam Networks Inc.'s balance sheet showed a
$18,406,000 stockholders' deficit, compared to a $13,893,000
deficit at Dec. 31, 2004.


ORMET CORP: Union Outrage Bursts Over Property Tax Payment Refusal
------------------------------------------------------------------
The United Steelworkers said that the union is outraged at Ormet
Corporation's decision to withhold property taxes owed to Monroe
County for the second half of 2005.  The union expressed that the
company's failure to meet its tax obligation will cause further
harm in a community already reeling from the effects of an eight-
month unfair labor practice strike at Ormet's two facilities in
Hannibal.

"Ormet walked on its debts and obligations to our members when the
company sprinted to bankruptcy court, and now the company is
trying to steal from the loyal taxpayers of Monroe County," said
USW District 1 Director David McCall.  "Our Union is unequivocally
dedicated to making sure Ormet pays for mistreating our members,
our families and our communities."

             Union Questions MatlinPatterson Role

The USW also revealed that investment fund MatlinPatterson,
currently Ormet's largest shareholder, has been linked to several
companies that have, like Ormet, disputed tax assessments.

Duke Energy challenged the assessed value of three power plants in
Mississippi in 2004 at the same time it was finalizing the sale of
the plants to KGen Partners, a subsidiary of MatlinPatterson.

Huntsman Chemical Corp. negotiated a $105 million reduction in the
appraised value of four chemical plants in Jefferson County, Texas
in July 2004.  MatlinPatterson held two seats on the board of
directors and a 49.9 percent equity stake in Huntsman at the time.

NRG Energy sued the town of Milford, Connecticut in May 2004,
claiming the town's appraisal of the Devon Power Station facility
was too high.  MatlinPatterson was the largest shareholder in NRG.

"MatlinPatterson and Ormet are attempting to turn a profit by
turning their backs on the communities that built those mills,"
McCall said.  "Ormet's workers and retirees deserve better, and so
do their children and grandchildren, who will bear the brunt of
the county's lost revenue."

In March, Ormet asked the Monroe County Board of Revisions to
reduce the appraised value of its property by more than
$30 million.  The matter is scheduled to be taken up at an Aug. 16
hearing.

About 1,300 members of USW Locals 5724 and 5760 have been on
strike against Ormet for unfair labor practices at Ormet's
aluminum reduction and rolling facilities in Hannibal since
Nov. 22, 2004, when the company unilaterally implemented wage and
benefit reductions.

Headquartered in Wheeling, West Virginia, Ormet Corporation --
http://www.ormet.com/-- is a fully integrated aluminum     
manufacturer, providing primary metal, extrusion and thixotropic
billet, foil and flat rolled sheet and other products.  The
Company and its debtor-affiliates filed for chapter 11 protection
on January 30, 2004 (Bankr. S.D. Ohio Case No. 04-51255).  Adam C.
Harris, Esq., in New York, represents the Debtors in their
restructuring efforts.  When the Company filed for bankruptcy
protection, it listed $50 million to $100 million in estimated
assets and more than $100 million in total debts.


PATRIOT MEDIA: S&P Rates Planned $282 Million Facilities at Low-Bs
------------------------------------------------------------------
Standard & Poor's Ratings Services assigned its 'B+' corporate
credit rating to Greenwich, Connecticut-based Patriot Media &
Communications CNJ, LLC.

In addition, Standard & Poor's assigned ratings to Patriot Media's
proposed $282 million aggregate facilities as:

   * a 'B+' bank loan rating was assigned to the company's first-
     lien term loan and revolver; and

   * a 'B-' rating was assigned to the second-lien term loan.

The recovery rating for the first-lien term loan and revolver is
'3', suggesting meaningful recovery (50%-80%) in the event of a
payment default or bankruptcy.  The second-lien term loan is two
notches below the corporate credit rating, at 'B-', based on the
significant amount of priority obligations from the first-lien
term loan and revolver.  

The recovery rating for the second-lien term loan is '5',
suggesting negligible recovery (0%-25%) in the event of payment
default or bankruptcy. The bank loan rating is based on
preliminary documentation subject to receipt of final information.
Pro forma debt is approximately $259 million.
     
Initial bank proceeds of $259 million will be used to:

   * pay a preferred dividend of $92 million to the company's
     private equity investors;

   * refinance the existing bank credit facility; and

   * pay approximately $4 million in transaction fees.

Patriot Media also will have access to a $25 million, first-lien
revolver, of which $2 million will be drawn upon closing.
      
"The ratings on Patriot Media reflect credit risk because of high
leverage, limited scale and geographic cash flow diversity, a
mature video business, and increased competition from Verizon,
which plans to deploy fiber to the home in a number of Patriot
Media's markets, as well as from satellite TV companies for video
services," said Standard & Poor's credit analyst Allyn Arden.

Tempering factors include:

   * the company's position as the dominant provider of pay TV
     services in demographically attractive franchise areas;

   * its status as a leading provider of consumer high speed data
     services using a single head end; and

   * revenue potential from enhanced services.

The company's system also has good asset value given its proximity
to other major cable operators.


PLASTECH ENGINEERED: Offers $1 Billion for Collins & Aikman
-------------------------------------------------------------
Plastech Engineered Products Inc. is offering up to $1 billion to
buy Collins & Aikman's assets, according to a report by Jeffrey
McCracken at the Detroit Free Press.  The transaction has advanced
to the point that Plastech delivered a letter to C&A's Board and
hired Goldman Sachs to raise money to fund the deal, Mr. McCracken
reports.  Plastech says it's ready to begin due diligence and the
final price will be adjusted upward or downward based on what it
finds.  

John Boken, Collins & Aikman's chief restructuring officer,
declined to confirm the $1 billion amount when asked by Jeff
Bennett and Jeff Green at Bloomberg News.  Mr. Boken confirmed
that the Board received Plastech's letter and that "other parties
have expressed interest in the company."  Collins & Aikman
executives have no plans to meet with Plastech executives prior to
Aug. 31, Mr. Boken added.

                       About Plastech

Headquartered in Dearborn, Michigan, Plastech Engineered Products
Inc. -- http://www.plastecheng.com/-- is a privately owned  
designer and manufacturer of primarily plastic automotive
components and systems for OEM and Tier I customers.  These
components and systems incorporate injection-molded plastic parts,
blow-molded plastic parts, and a small percentage of stamped metal
components.  They are used for interior, exterior and under-the-
hood applications.  Plastech employs 7,600 workers.  

As previously reported in the Troubled Company Reporter on
April 27, 2005, Moody's Investors Service cut the rating on
Plastech's $500 million loan facilities to single-B levels and
said the rating outlook is negative.  Standard & Poor's Ratings
Services, as reported in the Troubled Company Reporter on April
18, 2005, cut Plastech's corporate credit rating to 'B+' citing
weak operating results relative to expectations, high debt
leverage, and constrained liquidity.  

                    About Collins & Aikman

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.


PROVIDENT PACIFIC: Wants Stay Lifted to Foreclose on Property
-------------------------------------------------------------
MKA Capital Group, Inc., asks the U.S. Bankruptcy Court for the
Northern District of California, Santa Rosa Division, to lift the
automatic stay in Provident Pacific Corporation's chapter 11 case
so it can foreclose on its collateral.  

According to MKA, its collateral isn't adequately protected
because the Debtor's liability insurance policy expired on
July 27, 2005.  Provident has no resources to replace it.

In a hearing on July 28, the Court ordered the Debtor to provide
MKA with proof of replacement liability insurance by August 2.  
On August 2, the Debtor delivered an Insurance Binder.  MKA isn't
satisfied with the binder because it doesn't insure the
improvements on the property.  

MKA believes that the relief should be granted right away because
the property is unprotected.  MKA is afraid that if an accident
occurs prior to the Court's order lifting the automatic stay, then
it stands to lose the whole value of its collateral.

A hearing on MKA's motion for relief from stay is scheduled for
August 15.  MKA urges the Court to grant the relief without
further delay.  

The Collateral is the Timber Ridge Townhomes located at 39
Palisade Drive in Kirkwood, California.  

Headquartered in Belvedere, California, Provident Pacific
Corporation, filed for chapter 11 protection on June 8, 2005
(Bankr. N.D. Calif. Case No. 05-11435).  Michael H. Lewis, Esq.,
at Law Offices of Michael H. Lewis, represents the Debtor in its
restructuring efforts.  When the Debtor filed for protection from
its creditors, it listed total assets of $39,545,023 and total
liabilities of $28,495,982.


PROXIM CORP: Proposes Key Employee Retention & Incentive Program
----------------------------------------------------------------
Proxim Corporation and its debtor-affiliates ask the U.S.
Bankruptcy Court for the District of Delaware to approve its key
employee retention and incentive program.

Under the Debtors' prior Plan, most of the key employees and
senior managers were offered (or negotiated) severance packages
calling for payment of four months' compensation at termination to
in excess of a year's compensation.  The Debtors estimate that
their total severance obligations, if those obligations were
honored in full, would exceed $4,000,000.  In addition, various
key employees were offered incentive compensation that was fixed
on a case-by-case basis depending on the Debtors' objectives.

                         The New KERP

The Debtors propose that a "Disbursing Officer" -- expected to be
the Executive Chairman of the Board of Proxim, Inc. -- will have
discretion to distribute to employees he has identified as "key"
the funds held in two pools.  The first pool of $250,000 will be
funded in the event that a sale Proxim's assets is closed on or
before August 20, 2005.  The second pool will be funded if and
only if a substantially better bid than the pending proposal is
accepted and the sale thereafter closes on or before December 1,
2005.  The second pool will be funded with a percentage of the Net
Recovery to these estates from the sale transaction:

   -- 50% of the Net Recovery between $15,500,000 and $16,999,999;
  
   -- 25% of the Net Recovery between $17,000,000 and $20,999,999;
      and

   -- 10% of the Net Recovery above $21,000,000

Moseley Associates, Inc.'s stalking horse bid under the Asset
Purchase Agreement filed on June 27, 2005, is projected to deliver
about $13,500,000 in Net Recovery to the estates.  

Payments from Pool 1 and Pool 2 may be cumulative and are not
exclusive.  Obligations payable in connection with a Transaction
shall be funded at the closing of such Transaction and, if not
funded for any reason, shall constitute an administrative expenses
of the estate with priority under sections 503(b) and 507(a)(1) of
the Bankruptcy Code.

                     Justification for KERP

Rachel Lowy Werkheiser, Esq. at Pachulski, Stang, Ziehl, Young,
Jones & Weintraub P.C. in Wilmington, Delaware explains that in
light of the Debtors' likely inability to substantially fund
commitments under the Prior Plan, the Debtors' management sought
to achieve two objectives:

   1) to greatly reduce the amount of money that would have been
      paid as severance by the Debtors pursuant to the Prior Plan
      while retaining some of the benefits to the Debtors in terms
      of key employee morale and the other benefits to employers
      that are normally associated with severance and retention
      plans;  and

   2) to transfer a substantial portion of the benefits that would
      otherwise be contained in a strictly severance-based plan to
      an incentive-based plan.

Ms. Werkheiser assures the Court that the approval and
implementation of the Key Employee Retention and Incentive Program
is in the best interest of the Debtors' estate and is authorized
by the Bankruptcy Code.

Headquartered in San Jose, California, Proxim Corporation --
http://www.proxim.com/-- designs and sells wireless networking   
equipment for Wi-Fi and broadband wireless networks. The Debtors
provide wireless solutions for the mobile enterprise, security and
surveillance, last mile access, voice and data backhaul, public
hot spots, and metropolitan area networks.  The Debtor along with
its affiliates filed for chapter 11 protection on June 11, 2005
(Bankr. D. Del. Case No. 05-11639).  When the Debtor filed for
protection from its creditors, it listed $55,361,000 in assets and
$101,807,000 in debts.


RECYCLED PAPERBOARD: Auction Rescheduled to August 17
-----------------------------------------------------
The U.S. Bankruptcy Court for the District of New Jersey approved
the request of Recycled Paperboard Inc. to reschedule hearings and
deadlines set in the Court's order approving the Debtor's sale
procedures motion.

As reported in the Troubled Company Reporter on July 25, 2005, the
Court approved the auction of Recycle Paperboard Inc.'s 209,975+/-
square foot industrial facility set on 5.54+/- acres located at
One Ackerman Avenue in Clifton, New Jersey.

One Ackerman Associates LLC serves as the stalking horse bidder
with a $3.5 million offer for the property.

The Court rescheduled the auction from July 27 to August 17, 2005
at 12:00 p.m.  The deadline for submission of objections, if any,
to the proposed sale is rescheduled from July 28 to August 18,
2005 by 4:00 p.m.

The Court will convene a hearing on August 19, 2005 at 10:00 p.m.,
to confirm the auction's results.

Headquartered in Clifton, New Jersey, Recycled Paperboard Inc.,
manufactures recycled mixed paper and newspaper to make index, tag
& bristol, and blanks.  The Company filed for chapter 11
protection on November 29, 2004 (Bankr. D.N.J. Case No. 04-47475).  
David L. Bruck, Esq., at Greenbaum, Rowe, Smith & Davis LLP,
represents the Debtor in its restructuring efforts.  When the
Debtor filed for protection from its creditors, it listed total
assets of $17,800,000 and total debts of $41,316,455.


REDDY ICE: Prices 10.2 Million Equity Issue at $18.50 Per Share
---------------------------------------------------------------
Reddy Ice Holdings, Inc. (NYSE: FRZ) reported the pricing of its
initial public offering of 10,200,000 shares of common stock at
$18.50 per share.  Of the shares offered, 6,911,765 are being
offered by the Reddy Ice and 3,288,235 are being offered by
stockholders of Reddy Ice.  Certain of the selling stockholders
have granted to the underwriters a 30-day option to purchase up to
an additional 1,530,000 shares of common stock to cover over-
allotments, if any.

The offering is expected to close on August 12, 2005, subject to
customary conditions.  Reddy Ice's common stock was expected to
begin trading on the New York Stock Exchange on August 10, 2005
under the trading symbol "FRZ".

Bear, Stearns & Co., Lehman Brothers and Credit Suisse First
Boston LLC are acting as joint book-running managers for the
offering with Goldman, Sachs & Co. and CIBC World Markets acting
as co-managers for the offering.

Headquartered in Dallas, Texas, Reddy Ice Holdings, Inc., and its
subsidiaries manufacture and distribute packaged ice in the United
States serving approximately 82,000 customer locations in 32
states and the District of Columbia under the Reddy Ice brand
name.  The company is the largest of its kind in the United
States.  Typical end markets include supermarkets, mass merchants,
and convenience stores.  For the last twelve months ended June 30,
2004, consolidated revenue was approximately $260 million.

                         *     *     *

Reddy Ice Group's 8-7/8% senior subordinated notes due Aug. 11,
2011, carry Moody's B3 rating and Standard & Poor's B- rating.


RUFUS INC: Files for Chapter 11 Protection in Delaware
------------------------------------------------------
Rufus, Inc., a/ka/ Family Pet Centers, filed for chapter 11
protection in the United States Bankruptcy Court for the District
of Delaware yesterday, Aug. 10, 2005.  The Debtor disclosed that
it has experienced a financial downturn due to:

   -- overpriced retail space;
   -- decline in mall traffic;
   -- the rise of internet shopping;
   -- competition from traditional pet stores; and
   -- the rise in large format retailers.

The "one pet petstore" philosophy, the Debtor relates, has been
unsuccessful to its business and has caused a significant decline
in its revenues.  Having only a single line of pets, the Debtor
has had difficulty competing against more traditional pet stores
which sell the full line of animals purchased by consumers.

Before filing for bankruptcy, the Debtor took steps to reduce its
expenses.  These efforts included the reduction of open store
locations through abandonment or assignment of remaining leases.  
As a result, the Debtor has consolidated most of its inventory
into its remaining six locations.

The Debtor commenced the bankruptcy proceeding in order to further
reduce the number of store locations pursuant to Section 363 and
365 of the U.S. Bankruptcy Code.

The Hunte Corporation, the sole supplier of the Debtor's puppy
inventory, is an equity holder and the Debtor's largest unsecured
creditor.  The Debtor believes that Hunte is the natural purchaser
for the business.

                     Principal Indebtedness

The Debtor's consolidated liabilities primarily comprise of
financial accommodations in the form of secured and unsecured
debt.  The Debtor's secured debt is represented by:

     (i) a $303,000 prepetition secured loan agreement with Penn
         Business Credit, Inc.;

    (ii) $8.9 million prepetition secured financing arrangements
         with Meridian Venture Partners II, LP; and

   (iii) $3.2 million prepetition secured financing agreements
         with MVP Distribution Partners.

Penn Business holds a first lien on substantially all of the
Debtor's assets while the liens of Meridian Venture and MVP
Distribution are junior to the Penn loan but pari passu to each
other.  The remainder of the Debtor's obligations are comprised of
trade and other debt.

Meridian Venture is the Debtor's controlling stockholder, and its
designees hold three of the four seats on Rufus' Board.  MVP
Distribution is a related entity to and under common management
with Meridian Venture.

                   Predecessor's Bankruptcy

On Feb. 9, 2000, the Debtor's predecessor, D.C. Retail, Inc.,
filed for chapter 11 protection in the District of New Jersey
(Bankr. D. N.J. Case No. 00-51327) in order to implement new
strategies to reverse its business decline.  While in bankruptcy,
DC Retail closed a number of underperforming stores and took steps
to streamline operations and restructure the business.

The Bankruptcy Court confirmed DC Retail's plan of reorganization
on March 14, 2002.  The Company subsequently emerged from
chapter 11 and the bankruptcy case was closed on Oct. 30, 2002.  
Under the terms of the plan, postpetition lenders were granted
Series A and Series B preferred shares in the reorganized debtor.  

DC Retail eventually changed its name to Rufus, Inc., which sought
to find a niche among pet stores that focuses exclusively on dogs
and items associated with them.

Headquartered in Meriden, Connecticut, Rufus, Inc., sells dogs,
dog food, supplies and accessories.  The Debtor also operates a
chain of six retail stores in the Northeastern United States.  The
Company filed for chapter 11 protection on Aug. 10, 2005 (Bankr.
D. Del. Case No. 05-12218).  Edward J. Kosmowski, Esq., and Ian S.
Fredericks, Esq., at Young Conaway Stargatt & Taylor, LLP,
represent the Debtor in its bankruptcy proceeding.  When the
Debtor filed for protection from its creditors, it listed
$1.8 million in total assets and $12.7 million in total debts.


RUFUS INC: Case Summary & 20 Largest Unsecured Creditors
--------------------------------------------------------
Debtor: Rufus, Inc.
        aka D.C. Retail I, Inc.
        aka Family Pet Centers
        aka Rufus & Company
        aka Woof & Co.
        aka Maxie Biggz
        c/o Family Pet Center
        Westfield Shopping Town Meriden
        470 Lewis Avenue
        Meriden, Connecticut 06451-2102

Bankruptcy Case No.: 05-12218

Type of Business: The Debtor sells dogs, dog food, supplies and
                  accessories.  The Debtor also operates a chain
                  of six retail stores in the Northeastern
                  United States.

Chapter 11 Petition Date: August 10, 2005

Court: District of Delaware

Judge: Mary F. Walrath

Debtor's Counsel: Edward J. Kosmowski, Esq.
                  Ian S. Fredericks, Esq.
                  Young Conaway Stargatt & Taylor, LLP
                  1000 West Street, 17th Floor
                  P.O. Box 391
                  Wilmington, Delaware 19899
                  Tel: (302) 571-6600
                  Fax: (302) 571-1253

Debtor's
Financial
Advisor:          Hickey & Hill, Inc.
                  1009 Oak Hill Road, Suite 201
                  Lafayette, California 94549
Debtor's
Claims &
Noticing Agent:   Logan & Company, Inc.
                  546 Valley Road
                  Upper Montclair, New Jersey 07043

Total Assets: $1,800,000

Total Debts: $12,700,000

Debtor's 20 Largest Unsecured Creditors:

   Entity                        Nature of Claim    Claim Amount
   ------                        ---------------    ------------
Hunte Corporation                Trade Debt              $79,936
117 North Royhill Boulevard
Goodman, MO 64843

Stills Cummis Radin Tischman     Trade Debt              $45,160
One Riverfront Plaza
Newark, NJ 07102-5400

Allied Office Products           Trade Debt              $43,654
P.O. Box 31533
Hartford, CT 06150

Innovative Print & Media Group   Trade Debt              $26,516

RSM Construction Services        Trade Debt              $21,023

Valley Cottage Animal Hospital   Trade Debt              $20,992

Cintas Corporation               Trade Debt              $18,487

4925 Mayfour Square One          Trade Debt              $17,326

Smart & Associates LLP           Trade Debt              $16,546

Unishippers Hartford             Trade Debt              $16,238

Legg Mason Wood Walker Inc.      Trade Debt              $14,923

4838 Braintree Property          Trade Debt              $14,884
Association

King of Prussia Association      Trade Debt              $14,816

Verizon                          Trade Debt              $14,707

RGIS                             Trade Debt              $12,661

Semper FI Cleaning Systems       Trade Debt              $12,511

Dynamic Digital Services Inc.    Trade Debt              $12,117

Pyramid Mall of                  Trade Debt              $11,909
Glen Falls New York

Element Communications           Trade Debt              $11,303

Staples Business Advantage       Trade Debt              $10,666


RUSH RODEO: Voluntary Chapter 11 Case Summary
---------------------------------------------
Debtor: Rush Rodeo Company, LLC
        2983 Highway 489
        Lake, Mississippi 39092

Bankruptcy Case No.: 05-53570

Chapter 11 Petition Date: August 10, 2005

Court: Southern District of Mississippi (Gulfport)

Judge: Edward Gaines

Debtor's Counsel: Jeffrey K. Tyree, Esq.
                  Harris & Geno, PLLC
                  P.O. Box 3380
                  Ridgeland, Mississippi 39158-3380
                  Tel: (601) 427-0048      

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.


SAINT VINCENTS: Agrees to Return Escrow Balance to GE Capital  
-------------------------------------------------------------
Pursuant to a Financing Agreement dated December 31, 2002, Saint
Vincent Catholic Medical Centers paid for the equipment it
acquired from an escrow account funded by GE Capital Public
Finance, Inc.  GE Capital funded $13,216,000 into a special
dedicated escrow account established by The Bank of New York,
pursuant to an Escrow Agreement simultaneously entered with the
Financing Agreement.

Because the Escrow Fund was established prepetition, GE Capital
asserted that SVCMC is prohibited from operating under the
prepetition line of credit pursuant to Section 365(c)(2) of the
Bankruptcy Code.

After reviewing the Loan Documents, the Debtors and the Official
Committee of Unsecured Creditors have determined that the
$6,106,802 plus interest remaining in the Escrow Account is not
property of the estate.

After extensive negotiations, the parties agree that:

  1. Bank of New York will release turnover and deliver to GE
     Capital the Escrow Balance;

  2. upon release of the Escrow Balance, GE will provide to the
     Committee and the Debtors with written confirmation of
     receipt of the balance; and
  
  3. the automatic stay pursuant to Section 362 will be lifted to
     permit the turnover.

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


SAINT VINCENTS: Nurses' Association Wants Wage Hike Implemented
---------------------------------------------------------------
On June 18, 2005, Saint Vincents Catholic Medical Centers of
Staten Island and Bayley Seton Hospital entered into a memorandum
of understanding, which provided for a retroactive wage increase
back to November 1, 2004, that became due and payable on June 18,
2005.

The New York State Nurses Association represents the nurses at
five of Saint Vincents Catholic Medical Centers of New York and
its debtor-affiliates' facilities.  The Nurses Association
believes that the increases range from $480,000 to $520,000.

However, payment has not been made, Avrum J. Rosen, Esq., in
Huntington, New York, says.

In addition, approximately $37,000 in dues taken from the nurses'
salaries have not been remitted from the Debtors' facilities.

The Debtors also owe amounts to the New York State Nurses
Association Benefit and Pension Funds.  A check issued by the
Debtors to the Pension Plan for $162,348, and the check to the
Benefit Funds for $1,288,789 were deposited on July 1, 2005, and
were returned for insufficient funds.  

Accordingly, the Nurses Association asks the U.S. Bankruptcy Court
for the Southern District of New York to modify the Debtors'
Motion to include the amounts owed to them in the Cash Collateral
Budget.

                   Debtors Respond to Objection

Stephen B. Selbst, Esq., at McDermott Will & Emery LLP, in New
York, tells the Court that the Debtors currently are extremely
illiquid and have limited availability under their DIP Facility.  
Accordingly, the Debtors do not believe it is prudent to pay the
prepetition retroactive wage increases and pension payments at
this time.

Mr. Selbst also argues that the Nurses Association has no basis
or standing to object to the use of cash collateral because it
has no interest in the Debtors' cash collateral.  The Objection
was filed three weeks after the objection deadline and does not
offer any justification for the late filing.

Mr. Selbst also notes that the proposed cash collateral order
includes a detailed budget that adequately sets forth the
Debtors' cash needs, including the amounts needed to pay
"Payroll, Related Benefits, [and] Taxes."

The Debtors suspect that the Nurses Association is, in reality,
seeking payments of:

   (1) retroactive pay increases for the Association's members;

   (2) member dues payable to the Association; and

   (3) pension and benefit contributions.

Mr. Selbst tells Judge Beatty that each of these matters were
brought to the Debtors' attention only recently, but have not
been resolved within the Association's desired time frame.  To
date, Mr. Selbst relates, the Debtors are arranging for full
payment of the union dues.

The Debtors ask the Court to overrule the Objection.

                          *     *     *

Judge Beatty grants the Debtors authority to use the Cash
Collateral on an interim basis.

To the extent not resolved or withdrawn, all objections are
overruled.

The Court directs HFG Healthco-4 LLC not to turnover collections
of the receivables to:

   * Comprehensive Cancer Corporation on account of the CCC
     Receivables;

   * Primary Care Development Corporation on account of the
     St. Dominic's Receivables;

   * Commerce Bank N.A., on account of the Commerce Receivables;
     and

   * the Dormitory Authority of the State of New York on account
     of the Parking Garage Receivables and all other Receivables
     in which DASNY has a lien.

HFG is directed not to deposit the Mortgage Priority Collections,
if any, into the Issuance Designated Accounts contemplated by the
Authority Intercreditor Agreement.

The Debtors are authorized to grant the CCC, Primary Care,
Commerce Bank, DASNY and Sun Life Assurance Company of Canada and
Sun Life Assurance Company of Canada first priority replacement
liens on, and security interests in, the CCC, Commerce and
Parking Garage Accounts Receivable generated after the Petition
Date, as adequate protection of the Secured Creditors' interests
in the Cash Collateral.

The CCC is granted a first priority Replacement Lien on the CCC
Receivables for the period from July 5, 2005, to September 7,
2005.

The Debtors are authorized to pay $1.3 million to the CCC for the
period from July 5 to 31, 2005, retroactively, plus $650,000 on
August 15, 2005, as additional adequate protection.

RCG Longview II, L.P., has agreed to the Debtors' use of its Cash
Collateral until the Court considers its objection to the Interim
HFG Financing Order at the final hearing on the DIP Motion.

The Debtors and Sun Life have resolved Sun Life's objection
through a stipulation.

The Court will hold a final hearing on the Cash Collateral Motion
on September 7, 2005.  Objections if any, to the final order
approving the Debtors' use of the Cash Collateral are due
August 26, 2005.

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


SAINT VINCENTS: Resolves Sun Life Cash Collateral Dispute
---------------------------------------------------------
Before the Petition Date, Saint Vincent Catholic Medical Centers
of New York issued $78.3 million in promissory notes to the order
of Sun Life Assurance Company of Canada and Sun Life Assurance
Company of Canada (U.S.).  The Promissory Notes are secured by
first priority liens to the various properties of Saint Vincent
Catholic Medical Centers of New York and its debtor-affiliates.

On July 1, 2005, SVCMC defaulted on its obligation to pay Sun Life
$500,214 under the Loan Documents.

Although presently an oversecured creditor, Sun Life believes that
its interest in its cash collateral is not adequately protected
from diminution in value during the pendency of the Debtors'
bankruptcy cases.  As previously reported, Sun Life objected to
the Debtors' proposal to use its cash collateral.

SVCMC continues to hold $3,001,286, plus accruals, in debt service
reserve funds for Sun Life's benefit.

The Debtors and Sun Life have reached a stipulation that would
resolve the Objection.  

The principal terms are:

   (A) Sun Life is authorized to apply from the Debt Service
       Reserve $1,000,429, which represents the principal and
       Interest due under the Loan Documents from July 1 through
       August 4, 2005, and after that, to apply the principal and
       interest in accordance with the terms of the Loan
       Documents from the Petition Date through and including
       December 1, 2005, to reduce Sun Life's claims against the
       Debtors;

   (B) The market value of Sun Life's Collateral exceeds the
       value of Sun Life's interest in the Collateral, and
       therefore, Sun Life is an oversecured creditor pursuant to
       Section 506(b) of the Bankruptcy Code;

   (C) Sun Life will obtain these adequate protections:

       (1) a replacement security interest in and lien on all of
           the postpetition rents relating to Debtors' properties
           located at:

              * 275 North Street, Harrison, New York;
              * 203 West 12th Street, New York, New York;
              * 122-132 West 12th Street, New York, New York; and
              * 555 Sixth Avenue, New York, New York; and
          
       (2) an allowed superpriority administrative claim under
           Section 507(b) of the Bankruptcy Code against the
           Debtors' estates, with priority in payment over all
           administrative expenses or priority claims;

   (D) Costs or expenses of administration which have been or may
       be incurred in the Debtors' Chapter 11 cases will not be
       charged against Sun Life's claims or interests in the
       Debtors' property, without Sun Life's prior written
       consent;

   (E) The Debtors will pay Sun Life $56,000 for professional
       fees and expenses due under the Loan Documents from the
       Petition Date through August 4, 2005, and Sun Life will be
       reasonably reimbursed for attorney's fees and expenses
       associated with the Debtors' Chapter 11 cases in a monthly
       amount not to exceed $10,000 provided, however, that:
     
       (1) it will not apply to costs and expenses incurred in
           connection with any successful action by Sun Life to
           enforce any of the Loan Documents or any provision of
           the Stipulation; and
  
       (2) any fees and expenses incurred in excess of the
           Reimbursement Cap will be added to the Sun Life Claim;
          
   (F) The Stipulation between the parties will terminate on the
       earliest to occur of:

       (1) five business days after the Debtors and the Official
           Committee of Unsecured Creditors receive a written
           notice of any breach of the Stipulation relating to
           payment by the Debtors, and 10 business days for any
           other default, if the default is not cured within the  
           relevant time period;

       (2) the date the Court enters a final order lifting the
           automatic stay with respect to any of the Sun Life
           Collateral or Cash Collateral;

       (3) the date the Court enters a final order converting the
           Debtors' Chapter 11 cases to cases under Chapter 7 of
           the Bankruptcy Code;

       (4) the date the Court enters a final order appointing a
           trustee, examiner with expanded powers, or responsible
           person in the Cases that is not consented to by Sun     
           Life;

       (5) any use of the Sun Life Collateral that is not in
           accordance with the Loan Documents, or the
           Stipulation;

       (6) entry of a final and non-appealable order confirming a
           plan of reorganization for the Debtors;

       (7) the filing by any party's motion, adversary
           proceeding, or any other similar proceeding seeking to
           prime Sun Life's liens, claims or interests in the Sun  
           Life Collateral; or

       (8) December 2, 2005;

   (G) The Stipulation will not be deemed a waiver of any rights,
       defenses, or remedies the Debtors may have under the Loan
       Documents:

       (1) The automatic stay will be fully vacated to the extent
           necessary to permit Sun Life to exercise any and all
           rights and remedies under the Stipulation and the Loan
           Documents, provided, however, that:

              (i) in the event that the Debtors or the Creditors
                  Committee file a motion to re-impose or to
                  oppose lifting the stay during the Termination
                  Notice Period, the stay will only be lifted on
                  the Court's approval;

             (ii) Sun Life retains the right to move to lift the
                  stay on termination of the Stipulation and the
                  Debtors and the Committee reserve all rights to
                  object to a motion;

       (2) The right of the Debtors to use the Sun Life Cash
           Collateral will terminate, and the Debtors will pay
           over to an interest-bearing escrow account maintained
           by Kelley Drye & Warren LLP all Sun Life Cash
           Collateral not previously used by the Debtors; and

       (3) The Debtors will cooperate and comply with all
           reasonable requests by Sun Life in connection with the
           exercise of Sun Life's rights and remedies; and

   (H) The Debtors represent, among others, that:
   
       (1) property and liability insurance is currently in full
           force and effect with respect to the Sun Life
           Collateral; and

       (2) all taxes, assessments, water and sewer charges or
           other governmental or agency assessments or charges
           levied or assessed against the Collateral:

              (i) have been fully paid or will be paid prior to a
                  delinquency except to the extent that the
                  payment is neither permitted under the
                  Bankruptcy Code or authorized by the Court; and

             (ii) will be paid or cause to be paid by the Debtors  
                  when any become due and payable except to the
                  extent that the payment is either not permitted
                  under the Bankruptcy Code or not authorized by
                  the Court.

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


SHOPKO STORES: Stockholders to Vote on Merger at Sept. 14 Meeting
-----------------------------------------------------------------
ShopKo Stores, Inc. (NYSE: SKO), said that a special meeting of
shareholders will be held on Wednesday, September 14, 2005 to vote
on a proposal to approve the previously announced definitive
merger agreement that provides for the acquisition of ShopKo by an
affiliate of Minneapolis-based private equity investment firm
Goldner Hawn Johnson & Morrison Incorporated.  Shareholders of
record as of the close of business on Monday, August 1, 2005, will
be entitled to vote at the special meeting.  ShopKo will commence
the mailing of its definitive proxy statement to shareholders on
August 10, 2005.

The closing of the merger remains subject to approval of the
merger agreement by ShopKo's shareholders, funding under the
financing commitments obtained by GHJM and other customary
conditions.  ShopKo currently anticipates that the merger will
close during its third fiscal quarter.

ShopKo Stores, Inc. -- http://www.shopko.com/-- is a retailer of  
quality goods and services headquartered in Green Bay, Wisconsin,
with stores located throughout the Midwest, Mountain and Pacific  
Northwest regions.  Retail formats include 140 ShopKo stores,
providing quality name-brand merchandise, great values, pharmacy
and optical services in mid-sized to larger cities; 223 Pamida
stores, 116 of which contain pharmacies, bringing value and
convenience close to home in small, rural communities; and three
ShopKo Express Rx stores, a new and convenient neighborhood
drugstore concept.  With more than $3 billion in annual sales,
ShopKo Stores, Inc., is listed on the New York Stock Exchange
under the symbol SKO.  

                        *     *     *

As reported in the Troubled Company Reporter on April 18, 2005,   
Moody's Investors Service placed the long-term debt ratings of  
Shopko Stores, Inc., on review for possible downgrade following
the company's announcement that it had signed a definitive merger
agreement to be acquired by an affiliate of Goldner Hawn Johnson &  
Morrison.  The downgrade reflects the anticipated significant
increase in leverage as a result of the proposed transaction.  

The transaction is valued at slightly more than $1 billion and is
expected to be funded predominantly from debt with only $30
million of the purchase price to be funded by equity.  The company
has received a commitment from Bank of America to provide $700   
million in real estate financing and additional commitments from
Bank of America and Back Bay Capital Funding LLC to provide $415
million in senior debt financing.  

The proceeds from these financings along with the $30 million of
equity will be used to pay the merger consideration, refinance the
borrowings under the existing revolving credit facility, fund the
amounts due under the expected tender offer for the $100 million
senior unsecured notes due 2022, plus all fees and expenses.  

In addition, the financing will be used to cover all future
working capital needs.  If substantially all of the senior notes
are tendered the rating on those notes will be withdrawn.  The
review will focus on the debt protection measures of Shopko post
acquisition as well as the company's business strategy going
forward.  

These ratings are placed on review for possible downgrade:  

   * Senior implied of B1;  
   * Issuer rating of B2; and  
   * Senior unsecured notes due 2022 of B2.


SIERRA PACIFIC: S&P Rates Planned $225 Million Senior Notes at B-
-----------------------------------------------------------------
Standard & Poor's Ratings Services assigned its 'B-' rating to
Sierra Pacific Resources' (SRP; B+/Positive/B-2) proposed $225
million senior notes due 2015.  The outlook is positive.
     
"The 'B-' rating reflects the senior unsecured rating on SRP,"
said Standard & Poor's credit analyst Swami Venkataraman.  "It is
lower than the 'B+' corporate credit rating on SRP and its utility
subsidiaries given the deep structural subordination of the bonds
to more than $3 billion of debt at the utilities."
     
Proceeds from the issue will be used to pay the cash incentive
payment associated with the offer for early conversion of the $300
million convertible notes due 2010 as well as enable SRP to
participate in the remarketing of the $140 million of senior notes
associated with the premium income equity securities with the
intention of buying back the securities, effectively eliminating
the 2007 maturity.
     
The balance of the proceeds, after expenses, will provide
additional liquidity at SRP.  SRP has a call option on the notes
beginning on the fifth anniversary of the offering of the notes,
as well as the ability to pay down up to 35% of the notes with the
proceeds of any equity offering at SRP prior to the third
anniversary of the offering.
     
The outlook on SRP and its subsidiaries was revised to positive
from negative today, reflecting several positive credit
developments, including an improved regulatory environment in
Nevada, an improved liquidity profile at SRP and its utility
subsidiaries, and legal victories that have eliminated the
Enron litigation as a short-term risk.
     
Crucial were the more recent developments, principally:

   * the pending acquisition of the 570 MW Silverhawk plant that,
     along with the acquisition from Duke Energy of the 1,200 MW
     Lenzie plant, has substantially eliminated NPC's short
     position;

   * passage of Senate Bill 256 in 2005 that allows for two base
     tariff energy rate filings each year; and

   * the announcement on Aug. 3, 2005, of the cash offer to induce
     early conversion of SRP's $300 million convertible notes
     issued in February 2003.
     
This, along with the stock issue associated with the PIES, will
increase equity by up to $500 million in equity and significantly
improve SRP's consolidated financial profile.


SIRVA INC: S&P Lowers Corporate Credit Rating to B+ from BB
-----------------------------------------------------------
Standard & Poor's Ratings Services lowered its ratings on
relocation service provider SIRVA Inc. and its primary operating
subsidiary, SIRVA Worldwide Inc.  The corporate credit rating on
both entities was lowered to 'B+' from 'BB'.
     
All ratings remain on CreditWatch with negative implications,
where they were placed on April 8. 2005, due to:

   * the continued delay in filing SIRVA's year-end 2004 financial
     statements;

   * ongoing investigation related primarily to its insurance and
     European businesses; and

   * the disclosure that the cost to address its financial control
     weaknesses will be significantly higher than originally
     anticipated.

In July 2005, SIRVA was granted amendments to its bank facility
and accounts-receivable securitization program, extending the
filing deadline for its financial statements until
September 30, 2005.
      
"The downgrade reflects extraordinary charges associated with
SIRVA's insurance and European businesses, the extended delay in
filing 2004 financial statements, and incurrence of extensive
audit and investigation costs," said Standard & Poor's credit
analyst Kenneth L. Farer.  "Ratings remain on CreditWatch,
reflecting ongoing investigations into the company, the potential
for additional extraordinary charges, and further costs needed to
address inadequate financial controls," continued the analyst.
     
Earnings pressure, which started in the third quarter of 2004, due
to deteriorating market fundamentals in Europe, continues to
constrain earnings and cash flow.  The company has increased its
estimate of extraordinary charges to $45 million from its
previously disclosed estimate of $33 million.  SIRVA also
increased its guidance related to the costs associated with its
restatements, compliance with audit committee reviews, and ongoing
SEC investigation.
    
Standard & Poor's will continue to monitor SIRVA's situation
regarding its completed audited financial statements and the
ongoing support of its lenders to resolve the CreditWatch.  
Ratings could be lowered again if the audit committee review or
SEC inquiry results in additional material adjustments, a delay in
financial reporting beyond September 30, 2005, disclosure of
further internal control weaknesses, or violations of financial
covenants.
     
Westmont, Illinois-based SIRVA had $675 million of lease-adjusted
debt at September 30, 2004, the last reported date.


SOUTHAVEN POWER: Erie Power Wants Creditors Committee Appointed
---------------------------------------------------------------          
Erie Power Technologies, Inc., asks the U.S. Bankruptcy Court for
the Western District of North Carolina to direct the U.S.
Bankruptcy Administrator for the Western District of North
Carolina to appoint an Official Committee of Unsecured Creditors
in Southaven Power, LLC's chapter 11 case.

Erie Power is one of the Debtor's unsecured creditors.

On June 7, 2005, the Administrator filed a report informing the
Court that a Committee would not be formed because only Erie Power
and Centro Inc., another unsecured creditor, expressed an interest
in participating.

                 Erie Power's Claim &
       Request for Creditors Committee Appointment

On Nov. 3, 2000, Cogentrix Energy, Inc. entered into a Contract
Purchase Agreement No. SOUTH-HRSG-101 with Erie Power.  Under the
terms of the Contract, Erie Power agreed to furnish Heat Recovery
Steam Generators and related accessories for Cogentrix's project
located at Southaven, Mississippi.

In return, Cogentrix agreed to pay Erie Power a set purchase
price.  Under Section 8 of the General Terms and Conditions of the
Contract, Erie Power also assumed certain warranty obligations for
the equipment to be furnished in connection with the Contract.

Cogentrix subsequently assigned all of its rights and duties under
the Contract to the Debtor.  As a result of that assignment, the
Debtor is bound by the terms and conditions of the Contract.

Section 2 of the General Terms and Conditions of the Contract
generally provides that payment is due on or about 30 days after
receipt of an invoice from the Debtor, less 10% Retainage which
will be held until the date that is 30 days after the warranty
obligations of Erie Power pursuant to Section 8 of the General
Terms and Conditions of the Contract are extinguished.  

Pursuant to Section 2 of the Contract, the Debtor is still
retaining funds in the amount of $2,107,418.60, which Erie Power
says is the amount of the claim it asserts against the Debtor in
its chapter 11 case.  Erie Power's warranty obligations under the
Contract expired on June 1, 2004, but despite its repeated pre-
petition demands for release of the Retained Funds, the Debtor
refuses to do so until now.

Erie Power gives the Court four reasons why a Creditors Committee
should be appointed:

   1) although only it and Centro have expressed an interest in
      participating on a Committee, Section 1102(b)(1) of the
      Bankruptcy Code states that a Committee will ordinarily
      consist of the seven largest unsecured creditors, but it
      does not establish a minimum requirement;

   2) the unsecured creditors do not have adequate representation
      and the progress and direction of the Debtors' chapter 11
      case is being controlled by and operated for the benefit of
      the pre-petition and post-petition lenders;

   3) until now, Erie Power has shouldered the burden not only for
      itself, but also for the unsecured creditors as a whole and
      it is not reasonable or fair on its part to carry the flag
      on behalf of all unsecured creditors;

   4) the Debtor's case is a large chapter 11 proceeding, yet the
      unsecured creditors have no representative voice, making the
      appointment of a Committee necessary in order to protect the
      interests of the unsecured creditor body and to carry out
      the provisions and purposes of the Bankruptcy Code.

The Court will convene a hearing at 9:30 a.m., on Sept. 14, 2005,
to consider Erie Power's request.

Headquartered in Charlotte, North Carolina, Southaven Power, LLC,
operates an 810-megawatt, natural gas-fired electric power plant
located in Southaven, Mississippi.  The Company filed for chapter
11 protection on May 20, 2005 (Bankr. W.D.N.C. Case No. 05-32141).
Hillary B. Crabtree, Esq., at Moore & Van Allen, PLLC, and Mark A.
Broude, Esq., at Latham & Watkins LLP represent the Debtor in its
restructuring efforts.  When the Debtor filed for protection from
its creditors, it estimated assets and debts of more than $100
million.


TITAN CORP: Moody's Downgrades $200 Million Sr. Sub. Notes to B3
----------------------------------------------------------------
Moody's Investors Service downgraded the rating on Titan
Corporation's senior subordinated notes, due 2011, to B3 from B2,
concluding the review for downgrade initiated on June 11, 2005.

L-3 Communications announced on July 29, 2005 that in response to
its cash tender offer and consent solicitation, it had received
and accepted for purchase valid tenders and consents from holders
of approximately 99.97% of the outstanding $200 million Titan 8%
senior subordinated notes due 2011.  If L-3 cannot purchase the
remaining 0.03% of the notes which remain outstanding, it plans to
call the notes at the first call date in 2007.

The B3 rating on the notes reflects the lack of ongoing protection
for noteholders, given that the notes will be stripped of all
credit support and covenant protection.  Moreover, it is Moody's
intention to withdraw the rating on the remaining notes in the
very near term, given that over 99% of the notes have been
tendered.

L-3 also announced that it had completed its acquisition of Titan
Corporation and renamed Titan as L-3 Communications Titan
Corporation.  Moody's has withdrawn all other ratings on Titan
Corporation, consistent with the rating agency's July 22, 2005
announcement that ratings would be withdrawn upon closing of the
acquisition.

Moody's has taken these rating actions:

   -- $135 million senior secured revolving credit facility
      due 2008, Ba3 rating withdrawn

   -- $341 million senior secured term loan B due 2009, Ba3 rating
      withdrawn

   -- $200 million 8% senior subordinated notes due 2011,
      downgrade to B3 from B2

   -- Corporate family, Ba3 rating withdrawn

Headquartered in San Diego, California, Titan is a leading
technology developer, systems integrator, and services provider
for:

   * the Department of Defense,
   * the Department of Homeland Security and Intelligence, and
   * other key government agencies.

Titan had LTM March 2005 revenues of $2.1 billion.


TOM'S FOODS: Hires Deloitte & Touche as Auditor and Accountant
--------------------------------------------------------------
Tom's Foods Inc. asks the U.S. Bankruptcy Court for the Middle
District of Georgia for permission to employ and retain Deloitte &
Touche LLP as its auditors and accountants.

The Debtor selected Deloitte & Touche because of its experience
with and knowledge of the Debtor's business and financial affairs.  
The firm has provided services to the Debtor since June 2002.

Deloitte & Touche will audit and report on the Debtor's annual
financial statements for the year ended January 1, 2005.

The Firm will bill the Debtor based on its professionals' hourly
rates:

      Designation                         Hourly Rate
      -----------                         -----------
      Partner, Principal & Director       $550 - $650
      Senior Manager                      $450 - $550
      Manager                             $375 - $450
      Senior                              $275 - $350
      staff                               $200 - $250

Diane M. Lyons, Esq., Deloitte & Touche partner, assures the Court
that her Firm is disinterested as that term is defined in Section
101(14) of the Bankruptcy Code.

Headquartered in Columbus, Georgia, Tom's Foods Inc. manufactures
and distributes snack foods.  Its product categories include
chips, sandwich crackers, baked goods, nuts, and candies.  The
Company filed for chapter 11 protection on April 6, 2005 (Bankr.
M.D. Ga. Case No. 05-40683).  David B. Kurzweil, Esq., at
Greenberg Traurig, LLP, represents the Debtor in its restructuring
efforts.  When the Debtor filed for protection from its creditors,
it listed total assets of $93,100,000 and total debts of
$79,091,000.


TOUCH AMERICA: Settles Level 3's Administrative & Unsecured Claims
------------------------------------------------------------------
Brent C. Williams, the Plan Trustee of the Plan Trust of Touch
America Holdings, Inc., and its debtor-affiliates, asks the U.S.
Bankruptcy Court for the District of Delaware to approve a
compromise and settlement agreement with Level 3 Communications,
LLC.

Level 3 Communications asserted a general unsecured claim totaling
$131,308 for services rendered prior to the Debtors' bankruptcy
filing on June 19, 2003.  In addition, the Company filed a
$287,823 administrative claim against the Debtors for services
provided subsequent to the petition date.  The Debtors disputed
these claims.

Pursuant to the compromise and settlement agreement, Mr. Williams
agrees to pay the full amount of the administrative claims within
five days following the Court's approval of the agreement.  The
Plan Trustee also recognizes $100,000 of Level 3 Communication's
general unsecured claim.  The claim will be paid in accordance
with the terms of the Debtor's confirmed Plan.

The Plan Trustee believes that the compromise and settlement
agreement is fair, reasonable and in the best interest of the
Debtors' estates and their creditors.  He adds that a delay in
resolving Level 3 Communications' claims would be cost too much
and impede the claims resolution process.

The Honorable Kevin J. Carey will receive any objections to the
agreement at a hearing at 1:00 p.m. on Aug. 18, 2005.

Level 3 (Nasdaq:LVLT) is an international communications and
information services company.  The company operates one of the
largest Internet backbones in the world, is one of the largest
providers of wholesale dial-up service to ISPs in North America
and is the primary provider of Internet connectivity for millions
of broadband subscribers, through its cable and DSL partners.

Headquartered in Butte, Montana, Touch America Holdings, Inc.,
through its principal operating subsidiary, Touch America, Inc.,
develops, owns, and operates data transport and Internet services
to commercial customers.  The Company filed for chapter 11
protection on June 19, 2003 (Bankr. D. Del. Case No.
03-11915).  Maureen D. Luke, Esq. and Robert S. Brady, Esq. at
Young Conaway Stargatt & Taylor, LLP represent the Debtor.  When
the Company filed for bankruptcy protection, it listed
$631,408,000 in total assets and $554,200,000 in total debts.  The
Debtors Plan became effective on October 19, 2004.


TOUCH AMERICA: Wants to Recover $781,118 in Preferential Transfers
------------------------------------------------------------------
Brent C. Williams, the Trustee of the Plan Trust created pursuant
to the confirmed Liquidating Plan of Touch America Holdings, Inc.,
and its debtor-affiliates, asks the U.S. Bankruptcy Court for the
District of Delaware for permission to recover preferential
transfers made to Davis Wright Tremaine, LLP, totaling $781,118.

Mr. Williams tells the Court that the Debtors made the transfers
within the 90-day period prior to their bankruptcy filing on
June 19, 2003, as payment for various legal services provided by
Davis Wright.

In addition to the principal amount, the Plan Trustee also asks
permission from the Court to collect pre- and post-judgment
interest at the applicable legal rate of interest and recover
costs and expenses incurred in connection with this adversary
proceeding.

Davis Wright is a full service business and litigation firm with
more than 420 attorneys in its nine offices located in Anchorage;
Bellevue, Wash.; Seattle; Portland, Ore.; Los Angeles; San
Francisco; New York; Washington D.C.; and Shanghai, China.

A schedule of the payments made to Davis Wright is available for
free at http://researcharchives.com/t/s?b8

Headquartered in Butte, Montana, Touch America Holdings, Inc.,
through its principal operating subsidiary, Touch America, Inc.,
develops, owns, and operates data transport and Internet services
to commercial customers.  The Company filed for chapter 11
protection on June 19, 2003 (Bankr. D. Del. Case No.
03-11915).  Maureen D. Luke, Esq. and Robert S. Brady, Esq. at
Young Conaway Stargatt & Taylor, LLP represent the Debtor.  When
the Company filed for bankruptcy protection, it listed
$631,408,000 in total assets and $554,200,000 in total debts.  The
Debtors Plan became effective on October 19, 2004.


TWINLAB CORP: Bankr. & Dist. Courts Confirm Plan of Liquidation
---------------------------------------------------------------
The U.S. Bankruptcy Court for the Southern District of New York
and the U.S. District Court for the Southern District of New York
confirmed the First Amended Joint Plan of Liquidation of Twinlab
Corporation nka TL Administration Corporation, and its debtor-
affiliates.

The Bankruptcy Court confirmed the Plan on July 26, 2005.  
The District Court placed its stamp of approval on the Plan on
July 27, 2005.

The Bankruptcy Court and the District Court held a joint hearing
on July 21, 2005, on the Plan, which contemplates the liquidation
of all assets, and the proceeds of that liquidation being used to
partially satisfy unsecured creditors.

                        Terms of the Plan

Under the Plan, all fully insured pre-2002 ephedra personal injury
and wrongful death claims will survive the effective date of the
Plan as if the Debtors' chapter 11 cases had not been commenced.   

The Pre-2002 Ephedra PI Claims will be satisfied in full in the
ordinary course of business from the proceeds of the Debtors'
applicable insurance policy or policies, as the case may be.  
Uninsured and underinsured ephedra personal injury and wrongful
death claims will be determined and paid pursuant to the terms of
the Ephedra Personal Injury Trust and the Ephedra Personal Injury
Trust Agreement, which provide for the resolution of those claims
and the allocation of the funds in the Ephedra Personal Injury
Trust.

The Ephedra Personal Injury Trust will, upon the Effective Date or
as soon after that, be funded by contributions from the:

   (1) Debtors in the amount of $3,550,000; and

   (2) the American International Specialty Lines Insurance
       Company and certain third party defendants in the aggregate
       amount of $16,160,000.

In return for their respective contributions, the Debtors and the
Settling Third Parties and certain of their affiliates and
representatives will be released from any and all claims relating
to the 2002-2004 Ephedra PI Claims and other claims in connection
with the Debtors' ephedra-containing products.  In addition, as
part of the settlement, the Settling Third Parties have agreed to
release, among other things, their ephedra indemnification claims
against the Debtors that would otherwise have diluted the claims
pool and depleted recoveries to unsecured creditors.

The Plan further provides that on the Effective Date, the current
officers and directors will be deemed to have resigned.  Denis
O'Connor was appointed as Plan Administrator and retained the
powers and functions of the Debtors' officers and directors.  In
addition, the Plan Administrator was appointed as the initial
director and officer of TL Administration Inc. and TL
Administration (UK) Ltd., to serve in accordance with the
respective certificates of incorporation and by-laws of those
companies.

On Sept. 4, 2003, Twinlab Corporation, Twin Laboratories Inc. and
Twin Laboratories (UK) Ltd., commenced voluntary cases under
chapter 11 of title 11 of the United States Code in the United
States Bankruptcy Court for the Southern District of New York.
These chapter 11 cases are being jointly administered under
chapter 11 case number 03-15564 and are pending before the
Honorable Cornelius Blackshear.

Also, on Sept. 4, 2003, the Companies entered into certain asset
purchase agreement with IdeaSphere, Inc. of Grand Rapids,
Michigan, pursuant to which the Companies sold substantially all
of their assets.  The sale closed on Dec. 9, 2003.  In connection
with the sale, the Debtors obtained an order from the Court
authorizing them to change their names.  Twinlab Corporation
changed its name to TL Administration Corporation, Twin
Laboratories Inc., changed its name to TL Administration Inc., and
Twin Laboratories (UK) Ltd., changed its name to TL Administration
(UK) Ltd.

As of June 30, 2005, TL Administration Corporation's balance sheet
reflected a $53,703,000 equity deficit.  At the end of the same
period, TL Administration, Inc., stockholders' deficit amounted to
$20,722,000.  TL Administration (UK) Ltd. reported a $1,277,000
equity deficit as of the end of the second quarter.


UNITED RENTALS: Reports Preliminary Second Quarter 2005 Earnings
----------------------------------------------------------------
United Rentals, Inc. (NYSE: URI) expects diluted earnings per
share of $0.53 for the second quarter of 2005.  The company also
reaffirmed its previous full year 2005 outlook for diluted
earnings per share of $1.60 to $1.70 and free cash flow of at
least $200 million after total capital expenditures of
approximately $750 million.

               Preliminary Second Quarter 2005
                     Financial Highlights

For the second quarter 2005 compared with last year's second
quarter:

   -- Total revenues increased 15.5% to $896 million
   -- Same-store rental revenues increased 11.4%
   -- Contractor supplies sales increased 48% to $85 million
   -- Rental rates for the general rentals segment increased 5.2%
   -- Dollar utilization was 64.8%, an increase of 4.7 percentage    
      points

       Selected Business and Preliminary Financial Data

As previously announced, the company has delayed reporting final
results for 2004 and will delay finalizing results for 2005
interim periods until after it reports 2004 results.  Accordingly,
the company will delay filing its second quarter Form 10-Q beyond
the due date and the five-day extension period.  The earnings,
financial highlights, other selected financial data and 2005
outlook provided in this press release are preliminary and subject
to change based on completion of the 2004 audit or the outcome of
the previously announced SEC inquiry and the related internal
review.  This data should not be viewed as a substitute for full
financial statements.

Total revenues for the second quarter of 2005 were $896 million,
an increase of 15.5% compared with $776 million for the same
period last year. The size of the rental fleet, as measured by the
original equipment cost, was $3.9 billion and the age of the
rental fleet was 39 months at June 30, 2005, compared with
$3.7 billion and 40 months at year-end 2004.

Total revenues for the first six months of 2005 were
$1.63 billion, an increase of 14.6% compared with $1.42 billion
for the first six months of 2004. Cash flow from operations was
$356 million during the first half of 2005 compared with $359
million during the 2004 period. Cash flow from operations during
the first half of 2005 was essentially the same as in the first
half of 2004 due primarily to the impact of lower cash generated
from working capital in 2005.

Purchases of rental equipment were $482 million in the first half
of 2005 compared with $322 million in the first half of 2004.  
Free cash flow during the first half of 2005 was negative $21
million compared with free cash flow generation of $110 million
during the first half of 2004.  The decline in free cash flow was
largely the result of the $160 million increase in rental fleet
investment. The total cash balance was $254 million at June 30,
2005, a decrease of $48 million from year-end 2004.

General Rentals Segment

Second quarter 2005 revenues for general rentals were
$823 million, an increase of 16.0% compared with $709 million for
the second quarter of 2004. Rental rates for the second quarter
increased 5.2% and same-store rental revenues increased 11.3% from
the second quarter of 2004.

First half 2005 revenues for general rentals were $1.51 billion,
an increase of 15.4% compared with $1.31 billion for the first
half of 2004.  Rental rates for the first half increased 7.1% and
same-store rental revenues increased 11.2% from the first half of
2004.

General rentals segment revenues represented 93% of total revenues
in the first six months of 2005.

Traffic Control Segment

Second quarter 2005 revenues for traffic control were $73 million,
an increase of 10.2% compared with $67 million for the second
quarter of 2004.  Same-store rental revenues for the second
quarter increased 12.6% from the second quarter of 2004.

First half 2005 revenues for traffic control were $117 million, an
increase of 4.7% compared with $112 million for the first half of
2004.  Same-store rental revenues for the first half increased
6.3% from the first half of 2004.

"Our strong performance this quarter reflects our success in
continuing to improve rental rates, while at the same time
expanding our rental fleet and increasing time utilization,"
Wayland Hicks, chief executive officer, said.

"To drive future growth, we are opening new branches in attractive
markets.  We expect to open 30 to 35 new branches in 2005,
including the 18 we've already opened.  These branches will
increase our presence in existing markets and expand our footprint
into new areas."

Mr. Hicks continued, "We are also continuing to grow our sales of
contractor supplies at a rapid pace.  These sales were up 48%
compared with last year's second quarter, and we have opened eight
regional distribution centers to support future growth.

"The significant investment we are making in our branch network
and our rental fleet should allow us to capitalize on the
continued improvement in private non-residential construction
spending. First half spending rose 5.9% year-over-year according
to Department of Commerce data."

Mr. Hicks concluded, "We are working diligently to finalize our
results as soon as possible.  In the meantime, our organization is
continuing to focus on providing superior customer service and
growing the business. For the full year 2005, we are on track to
achieve total revenues of $3.4 billion, diluted earnings per share
of $1.60 to $1.70 and free cash flow of at least $200 million."

            Special Committee Review on SEC Inquiry

The special committee of independent directors of the company's
board of directors is continuing to review matters relating to the
SEC inquiry.  As previously stated, this inquiry appears to relate
to a broad range of the company's accounting practices and is not
confined to a specific period.

As previously reported, the matters being reviewed by the special
committee include several short-term equipment sale-leaseback
transactions that occurred in 2000, 2001 and 2002.  The special
committee review of these transactions, as well as its broader
review relating to the SEC inquiry, is ongoing and no final
conclusions have been reached.  However, as previously reported,
the committee has information that suggests that the accounting
for at least some of these sale-leaseback transactions was
incorrect.  The company reported aggregate gross profit from these
transactions of $12.5 million, $20.2 million and $1.5 million in
2000, 2001 and 2002, respectively.

                     Status of 2004 Results

As previously disclosed, the company has delayed finalizing its
2004 results in order to review matters relating to the SEC
inquiry and complete the self-insurance and income tax
restatements.  The company expects to finalize its results for the
first and second quarters of 2005 after it reports final results
for 2004.  The company will also set its 2004 annual meeting date
at that time.

United Rentals, Inc. -- http://www.unitedrentals.com/-- is the  
largest equipment rental company in the world, with an integrated
network of more than 730 rental locations in 48 states, 10
Canadian provinces and Mexico.  The company's 13,200 employees
serve construction and industrial customers, utilities,
municipalities, homeowners and others.  The company offers for
rent over 600 different types of equipment with a total original
cost of $3.9 billion.  United Rentals is a member of the Standard
& Poor's MidCap 400 Index and the Russell 2000 Index(R) and is
headquartered in Greenwich, Connecticut.

                        *     *     *

As reported in the Troubled Company Reporter on July 18, 2005,
Moody's Investors Service lowered the long-term ratings of United
Rental (North America) Inc. and its related entities:

   * Corporate Family Rating (previously called Senior Implied)
     to B1 from Ba3;

   * Senior Unsecured to B2 from B1; Senior Subordinate to B3
     from B2; and

   * Quarterly Income Preferred Securities to Caa1 from B3.

The rating action is prompted by the continuing challenges facing
the company in resolving the pending SEC investigation and certain
accounting irregularities.  These challenges are accentuated by
today's announcement regarding the employment status of the
company's President and Chief Financial Officer.  URI's board
determined that refusal by the President and CFO to answer
questions at this time by the special committee of the board
constitutes a failure to perform his duties, and would constitute
grounds for termination if not cured within the thirty-day cure
period provided by his employment agreement.  The special
committee of the board is reviewing matters relating to the
previously disclosed SEC inquiry of the company.


UNIVERSAL HOSPITAL: June 30 Balance Sheet Upside-Down by $94 Mil.
-----------------------------------------------------------------
Universal Hospital Services, Inc., reported financial results for
the quarter and six months ended June 30, 2005.

Total revenues were $53.4 million for the second quarter of 2005,
representing a $4.1 million or 8% increase from total revenues of
$49.3 million for the same period of 2004.  Through the first six
months of 2005, revenues increased by 11% to $108.7 million.

Gross margin for the second quarter of 2005 totaled $21.8 million,
representing a $600,000 or 3% increase from total gross margin of
$21.2 million for the same period of 2004.  In the first six
months of 2005, gross margin increased by 5% to $45.5 million.

Net loss for the quarter was $1.5 million, compared to net loss of
$600,000 for the same quarter last year.  During the first six
months of 2005 the company reported a net loss of $500,000 versus
net income of $700,000 for the same period of 2004.

Second quarter EBITDA before management/board fees and SOX
compliance costs was $17.4 million, representing a $500,000 or 3%
increase from $16.9 million for the same period of 2004.  EBITDA
before management/board fees and SOX compliance costs for the
first six months of 2005 increased $1.8 million, or 5% to $37.4
million from $35.6 million for the first six months of 2004.

"The second quarter and first half results met our expectations as
we experienced solid outsourcing revenues", said Gary Blackford,
President and CEO.  "We have made good progress in signing new
resident-based programs so far this year, and continue to build
our position as the premier Equipment Lifecycle Services Company
in the industry."

Based in Edina, Minnesota, Universal Hospital Services, Inc. is a
leading medical equipment lifecycle services company.  UHS offers
comprehensive solutions that maximize utilization, increase
productivity and support optimal patient care resulting in capital
and operational efficiencies.  UHS currently operates through more
than 75 offices, serving customers in all 50 states and the
District of Columbia.

At Jun. 30, 2005, Universal Hospital Services, Inc.'s balance
sheet showed a $93,583,000 stockholders' deficit, compared to a
$93,058,000 deficit at Dec. 31, 2004.


US AIRWAYS: Terms of Second Amended Plan of Reorganization
----------------------------------------------------------
As reported in the Troubled Company Reporter yesterday, the U.S.
Bankruptcy Court of the Eastern District of Virginia approved the
Second Amended Disclosure Statement filed by US Airways, Inc., and
its debtor-affiliates.

The Debtors filed their Second Amended Joint Plan of
Reorganization and Disclosure Statement on August 7, 2005.

Brian P. Leitch, Esq., at Arnold & Porter, in Denver, Colorado,
says the amendments include modifications to the Classification of
Claims.

The Second Amended Plan provides that in satisfaction of the Class
USAI-7 (PBGC Claim), the PBGC will receive:

   (1) $13,500,000 in Cash;

   (2) a $10,000,000 unsecured promissory note issued by
       Reorganized USAI and guaranteed by Reorganized Group, at
       6.00% interest per annum payable annually in arrears,
       payable in a single installment on the seventh anniversary
       of the Effective Date; and

   (3) 70% of the Unsecured Creditors Stock; or

   (4) other treatment as agreed by the parties and ordered by
       the Court.

Class USAI-7's estimated amount of claims and estimated
percentage recovery amounts were deleted.

The provision for Class USAI-9 (General Unsecured Claims) was
likewise modified.  Under the Second Amended Plan, each holder of
an Allowed General Unsecured Claims will receive their Pro Rata
share of 30% of the Unsecured Creditors' Stock.  The estimated
claim amount has been updated to $408,500,000 to $1,241,500 from
$458,500,000 to $1,311,500,000.  The estimated percentage
recovery has also been changed to 3.1% to 17.4% from 3.3% to
8.3%.

The Debtors currently estimate that at the conclusion of the
claims resolution process the aggregate amount of estimated and
allowed General Unsecured Claims, inclusive of General Unsecured
Convenience Claims, against the Debtors will be between
$430,750,000 and $1,303,000,000.  This is in addition to the PBGC
Claims, Secured Claims, like the ATSB Loan Claims, Aircraft
Secured Claims, and Miscellaneous Secured Claims.

          Officers and Directors of Reorganized Group

The Second Amended Plan discloses that after the Merger, these
individuals will be recommended to the board of directors of
Reorganized Group for positions on the executive team:

   * W. Douglas Parker, chairman of the board, president and
     chief executive officer of America West and AWA and has
     served as a director of America West since 1999.

   * Bruce R. Lakefield, president and chief executive officer
     and a director of Group and USAI.

   * Alan W. Crellin who joined Group in 1988 as a result of
     the acquisition of Pacific Southwest Airlines.

   * J. Scott Kirby, currently executive vice president -- sales
     and marketing of AWA.

   * Jeffrey D. McClelland, executive vice president and chief
     operating officer of AWA.

   * Derek J. Kerr, senior vice president and chief financial
     officer of AWA and America West.

   * James E. Walsh III, senior vice president and general
     counsel of AWA.

   * C.A. Howlett, senior vice president -- public affairs of AWA
     and America West.

   * Elise R. Eberwein, vice president -- corporate
     communications of AWA.

                    2005 Equity Incentive Plan

The Plan has been modified to include the terms of the 2005
Equity Incentive Plan, Mr. Leitch explains.

On the Effective Date, Reorganized Group will adopt the 2005
Equity Incentive Plan, which provides for the grant of incentive
stock options, non-statutory stock options, stock appreciation
rights, stock purchase awards, stock bonus awards, stock unit
awards, other forms of equity compensation and performance-based
cash awards.  The Board of Directors will administer the 2005
Equity Incentive Plan.  The Board will construe and interpret the
2005 Equity Incentive Plan and determine stock awards, the number
of shares of New Common Stock for each stock award, the time of
exercise, the exercise, purchase, or strike price, the type of
consideration permitted and other terms.  The Board may
accelerate the exercise or vesting of any stock award.

The Board may delegate administration of the 2005 Equity
Incentive Plan to a committee, consisting of two or more non-
employee directors.  The committee may delegate administrative
powers to a subcommittee.

Incentive stock options may be granted to employees of
Reorganized Group and its affiliates.  One person may not receive
more than 1,000,000 shares of stock options or stock appreciation
rights of New Common Stock for any calendar year.  For fully
diluted shares of New Common Stock for issuance under the 2005
Equity Incentive Plan, only 12.5% may be granted pursuant to
incentive stock options.

The number of shares of New Common Stock for issuance will be
reduced by:

   (1) one share for each share of New Common Stock issued
       pursuant to a stock option or a stock appreciation
       right; and

   (2) three shares for each share of New Common Stock issued
       pursuant to a stock purchase award, stock bonus award,
       stock unit award and other full-value types of stock
       awards.

Stock awards that are terminated, forfeited or repurchased will
result in an equal increase in the share reserve.

On the Effective Date, these stock appreciation rights will be
granted to the executives indicated under the 2005 Equity Plan:

    * 196,000 for W. Douglas Parker;
    * 165,000 for each executive vice president; and
    * 51,000 for each senior vice president.

Each stock appreciation right will represent the right to receive
the appreciation of one share of New Common Stock in excess of
the fair market value on the date of the Merger.  About 50% of
the stock appreciation rights granted upon the Merger will vest
on the second anniversary of the grant date and 25% will vest on
each of the third and fourth anniversaries of the grant date.   
The stock appreciation rights will be exercisable after vesting
for 10 years from the grant date.

Mr. Parker will be granted 41,250 restricted stock units subject
to time vesting.  Each restricted stock unit will represent the
right to receive one share of New Common Stock.  Subject to
acceleration, 50% of the restricted stock units granted to Mr.
Parker will vest on the second anniversary of the grant date, and
25% will vest on each of the third and fourth anniversaries of
the grant date.

Additional restricted stock units will be granted:

   -- 20,625 to Mr. Parker;
   -- 10,300 to each executive vice president; and
   -- 3,200 to each senior vice president.

Each restricted stock unit will represent the right to receive
one share of New Common Stock, provided that restricted stock
units will not vest and no underlying shares will be issued
unless the operating certificates of USAI and AWA have been
combined within three years after the Merger.  Subject to
acceleration, 50% of the restricted stock units will vest on each
of the third and fourth anniversaries of the grant date.

The vesting of each equity grant will be accelerated if the
recipient executive is terminated without cause or by death or
disability, if the executive terminates employment for good
reason, or if the executive is terminated without cause within 24
months after a change in control.  No shares underlying the
restricted stock units subject to both time and performance
vesting will be issued unless the USAI and AWA operating
certificates have been combined within three years and the
executive has remained employed by Group.

In consideration for the equity award granted to Mr. Parker and
the option grant for 500,000 shares awarded in August 2005 under
the terms of the America West 2002 Incentive Equity Plan, Mr.
Parker will waive his rights to voluntarily terminate his
employment without good reason for two years after the Merger and
still receive full severance benefits under a change in control
resulting from the Merger.

The AFA reserves the right to challenge the 2005 Equity Incentive
Plan at the Confirmation Hearing.

                      Proposed Stock Offering

The Second Amended Plan provides that Group may engage in a
proposed stock offering of up to $150 million pursuant to a
registration statement on Form S-1 under the Securities Act.  If
Group determines to effect the Stock Offering, it may make a
portion of the offering available to holders of shares of America
West's Class A and Class B common stock and to certain unsecured
creditors of the Debtors entitled to vote on the Plan.  

Any participation by unsecured creditors of the Debtors could be
based on their allowed claims for voting purposes.  The
procedures by which unsecured creditors of the Debtors may seek
to establish a temporary allowance of their Claims for voting
purposes are set forth in the Plan.  Accordingly, any unsecured
creditors of the Debtors whose Claims have not been Allowed prior
to August 7, 2005, may wish to avail themselves of the procedures
set forth in the Plan with respect to temporary allowance of
their Claims for voting purposes to obtain eligibility to
participate in the Stock Offering.

Completion of the Merger and the effectiveness of the Plan are
not conditioned on completion of the Stock Offering.  For
purposes of voting on the Plan, holders of Claims in Class 9
should assume that Group will not engage on the Stock Offering.

        Officers Receiving Modified Employment Contracts

The Plan provides for the assumption of 24 employment contracts
with the Debtors' senior executives.  Pursuant to their
Transaction Retention Program, the Debtors signed modified
contracts with the 24 officers.  The modified contracts provide
materially lower compensation and severance benefits than:

   (1) the executives' current unassumed prepetition employment
       contracts -- with the exception of certain officers who
       were promoted during the pendency of the Chapter 11 cases;
       and

   (2) contracts for officers holding similar positions at
       America West.

   Executive              Position
   ---------              --------
   Bruce R. Lakefield     President & Chief Executive Officer
   Alan W. Crellin        Executive Vice President - Operations
   Jerrold A. Glass       Executive Vice President & HR Officer
   Elizabeth K. Lanier    Executive Vice President - Corporate
                             Affairs, General Counsel & Secretary
   Ronald E. Stanley      Executive Vice President & CFO
   Anita P. Beier         Senior Vice President - Finance and
                             Controller
   Christopher Chiames    Senior Vice President - Corporate
                             Affairs
   Andrew P. Nocella      Senior Vice President - Planning
   John Prestifilippo     Senior Vice President - Maintenance
   Edward W. Bular        Vice President - Flight Operations
   Kerry J. Carstairs     Vice President - Direct Distribution
   Janet L. Dhillon       Vice President & Deputy General Counsel   
   Sharon R. Groff        Vice President - Inflight Services        
   John M. Hedblom        Vice President - Human Resources Policy
                             and Development
   E. Allen Hemenway      Vice President - Labor Relations
   Douglas D. Leo         Vice President - Sales & International
   Stephen L. Morrell     Vice President - Finance and Treasurer
   Rosemary G. Murray     Vice President - Government Affairs    
   Donna E.G. Paladini    Vice President - Customer Service
   James P. Schear        Vice President - Safety and Regulatory
                             Compliance
   Helen M. Tremont       Vice President - Corporate Real Estate
   Bill Trousdale         Vice President - Financial Planning and
                             Analysis
   Stephen Farrow         President and Chief Executive Officer
                             of Piedmont Airlines, Inc.         
   Keith D. Houk          President & Chief Executive Officer of
                             PSA Airlines, Inc.

            Executory Contracts and Unexpired Leases

To satisfy numerous creditor objectors, the Plan provisions on
executory contracts and unexpired leases was amended to provide
that:

   (1) If any Person objects to its inclusion on the Post-
       Effective Date Determination Schedule, the Person must
       provide written notice to the Debtors within 72 hours
       before the Confirmation Hearing.  Unless the Debtors filed
       a request with the Court prior to the Confirmation Hearing
       to assume the Other Executory Contract or Unexpired Lease,
       it will be deemed rejected on the earlier of:

       (a) the Closing of either of the Eastshore or Wellington
           Investment Agreements; or

       (b) 60 days after entry of the Confirmation Order, unless
           otherwise agreed by the parties.

       The Debtors reserve the right to file a request to assume
       or reject any Other Executory Contract or Unexpired Lease.
       If the Contract or Lease is removed from the Contracts
       Assumption Schedule or is subject to a motion to reject,
       the counterparty may file a proof of claim and may change
       their vote on the Plan and file an objection to the Plan.
       The Debtors will not object to the temporary allowance of
       the Claims for voting purposes.

       If the Debtors modify the Contracts Assumption Schedule or
       seek to reject any Other Executory Contract or Unexpired
       Lease originally included on the Contracts Assumption
       Schedule, the Debtors will notify the counterparty via
       facsimile, e-mail and telephone.  The effective date of
       rejection for Other Executory Contracts or Unexpired
       Leases will not be later than the Rejection Effective
       Date.

   (2) If an Other Executory Contract or Other Unexpired Lease
       involving Aircraft Equipment has been assumed or is
       assumed:

       (a) the determination of cure amounts will be made
           pursuant to Sections 365(b) and 1110;

       (b) the Plan provisions governing the Cancellation of
           Existing Equity Securities and Agreements and
           Surrender of Securities or Instruments do not apply to
           any note, bond or other security to which the assumed
           Other Executory Contract or Other Unexpired Lease
           relates, or to any pass through trust agreement, pass
           through trust certificate, participation agreement or
           other instrument; and

       (c) all Associated Instruments relating to an assumed
           Other Executory Contract or Other Unexpired Lease will
           be deemed assumed.

A redlined copy of the Debtors' Second Amended Disclosure
Statement is available for free at:

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

A redlined copy of the Debtors' Second Amended Plan of
Reorganization is available for free at:

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


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


VARELA ENTERPRISES: Confirmation Hearing Set for Sept. 9
--------------------------------------------------------
The U.S. Bankruptcy Court for the District of Arizona approved the
Disclosure Statement explaining Varela Enterprises, Inc.'s Amended
Plan of Reorganization filed on June 22, 2005.  

The Honorable James B. Marlar found the Disclosure Statement to
contain adequate information -- the right kind, and in sufficient
detail -- that would enable a hypothetical investor to make an
informed judgment about the Plan.

With a Court-approved Disclosure Statement, the Debtor can now
solicit acceptances of its Plan.

The Court will convene a hearing to discuss the merits of the Plan
on Sept. 9, 2005, at 9:30 a.m. at the U.S. District Court Building
located at 325 19th Street in Yuma, Arizona.

                        About the Plan

The Plan proposes to pay all creditors in full from the Debtor's
contract with Grupo Constructor Industrial e Inmobiliario, S.A.,
and an on-going bid for a government project in Mexico.  The
Debtor further expects to receive payment for more than $81,000 in
account receivables from completed construction work.

The Plan will also be funded from the proceeds of a lawsuit to be
filed against the Debtor's former landlord for breach of contract
and damages.  The Debtor says it defaulted on existing commitments
and consequently filed for bankruptcy protection after its
landlord locked it out of its leased building and shut down
operations.     

                      Treatment of Claims

Allowed priority deposit claims of up to $2,225, of individuals
for the purchase, lease, or rental of property or service will be
paid in full, without interest, within three months from the
effective date of the Plan.

GMAC's claims, secured by a 2003 Cadillac Escalade and a 2002
Cadillac Escalade, will be paid according to the lease contract.  
GMAC will retain its security interest in the vehicles.

All general unsecured residential construction and vendor claims
against the Debtor will be paid in full within three years from
the effective date of the Plan.

J. P. Sandoval, M.P. Sandoval, and Henry Varela 11's unsecured
claims against the Debtor, totaling $967,695, will be paid in full
after all other unsecured claims have been satisfied.

Headquartered in Moorpark, California, Varela Enterprises Inc., a
subcontractor for Varela Manufacturing Company, LLC, holds a
license to use the patented "E systems" construction process for
producing prefabricated buildings.  The Debtor filed for Chapter
11 protection on May 21, 2004 (Bankr. D. Ariz. Case No. 04-00725).  
Robert M. Cook, Esq. at the Law Offices of Robert M. Cook,
represent the Debtor in its restructuring efforts.  When it sought
chapter 11 protection, the Debtor reported between $10  million to
$50 million and debts between $1 million to $10 million.


WATTSHEALTH FOUNDATION: Section 341(a) Meeting Slated for Aug. 16
-----------------------------------------------------------------          
The U.S. Trustee for Region 16 will convene a meeting of
WATTSHealth Foundation, Inc.'s creditors at 10:00 a.m., on Aug.
16, 2005, at the Office of the U.S. Trustee, 725 S. Figueroa
Street, Room 2610, Los Angeles, California 90017.  This is the
first meeting of creditors required under 11 U.S.C. Sec. 341(a) in
all bankruptcy cases.

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

Headquartered in Inglewood, California, WATTSHealth Foundation,
Inc., dba UHP Healthcare, provides comprehensive medical and
dental services for Commercial, Medi-Cal and Medicare members in
the Greater Southern California area.  The Company filed for
chapter 11 protection on May 31, 2005 (Bankr. C.D. Calif. Case No.
05-22627). Gary E. Klausner, Esq., at Stutman Treister & Glatt
represents the Debtor in its restructuring efforts.  When the
Debtor filed for protection from its creditors, it estimated
assets and debts of $50 million to $100 million.


WATTSHEALTH FOUNDATION: Taps Alvarez & Marsal as Restr. Advisors
----------------------------------------------------------------          
WATTSHealth Foundation, Inc., asks the U.S. Bankruptcy Court for
the Central District of California, Los Angeles Division, for
permission to employ Alvarez & Marsal LLC as its restructuring
advisors.

Alvarez & Marsal will:

   1) undertake, in consultation with members of management, an
      analysis of the business, operations, financial condition
      and prospects of the Debtor and review with members of
      management the Debtor's financial plans and analyze its
      strategic plans and business alternatives;

   2) assist the Debtor in reviewing and assessing its cash-flow
      and income projections and in the sale of part or all of the
      Debtor;

   3) assist the Debtor in its presentations to creditors and
      regulators of its projections and restructuring plan, assist
      in post-bankruptcy strategies and bankruptcy administration,
      and in negotiation with key creditors and regulators;

   4) analyze existing direct and contingent liabilities of the
      Debtor and advise it with respect to available capital and
      financing alternatives, including recommending specific
      courses of action;

   5) ascertain the Debtor's debt-servicing capabilities of the
      Debtor and any additional funding requirements, including
      working-capital, trade-financing, equipment acquisition and
      other financing needs;  

   6) advise and assist the Debtor in developing and seeking
      approval of a restructuring plan, which may be a plan of
      reorganization; and

   7) provide all other restructuring advisory services to the
      Debtors that are necessary in its chapter 11 case.

Bradley A. Lang, a Senior Director of Alvarez & Marsal, disclosed
that his Firm has not received any retainer.  Mr. Lang charges
$450 per hour for his services.

Mr. Lang reports Alvarez & Marsal's professionals bill:

      Professional         Designation    Hourly Rate
      ------------         -----------    -----------
      Matt Thompson        Associate         $350

      Designation          Hourly Rate
      -----------          -----------
      Directors            $350 - $450
      Associates           $250 - $350
      Analysts             $150 - $225
      Para-professionals    $75 - $150

Alvarez & Marsal assures the Court that it does not represent any
interest materially adverse to the Debtor or its estate.

The Court will convene a hearing at 10:30 a.m., on Aug. 17, 2005,
to consider the Debtor's request.

Headquartered in Inglewood, California, WATTSHealth Foundation,
Inc., dba UHP Healthcare, provides comprehensive medical and
dental services for Commercial, Medi-Cal and Medicare members in
the Greater Southern California area.  The Company filed for
chapter 11 protection on May 31, 2005 (Bankr. C.D. Calif. Case No.
05-22627). Gary E. Klausner, Esq., at Stutman Treister & Glatt
represents the Debtor in its restructuring efforts.  When the
Debtor filed for protection from its creditors, it estimated
assets and debts of $50 million to $100 million.


WESTPOINT STEVENS: Completes $703.5 Mil. Sale to WestPoint Int'l
----------------------------------------------------------------
American Real Estate Partners, L.P. (NYSE: ACP - News; "AREP") and
WestPoint Stevens Inc. (Pink Sheet: WSPTQ.PK) reported that
WestPoint Stevens has completed the sale of substantially all of
the Company's assets to WestPoint International, Inc., a newly
created entity a majority of the voting securities of which will
be owned by AREP.  AREP, which is affiliated with Carl C. Icahn,
is engaged in core businesses that include oil & gas, gaming and
real estate.  As the result of its stock ownership, AREP will be
able to elect the entire board of directors of WestPoint
International.

The terms of the sale, valued at $703.5 million, provide for the
issuance of stock in WestPoint International, Inc., that will own
all of the purchased assets of WestPoint Stevens, Inc., through
its indirect subsidiary, WestPoint Home, Inc., which will be the
primary operating entity of the new company.  In accordance with
the terms of the purchase agreement, WestPoint Home, Inc., will
pay current trade payables to WestPoint Stevens' vendors in the
ordinary course.

The holders of the Company's first lien debt will receive 35% of
the common stock of WestPoint International, Inc.  As the holder
of 40% of the Company's first lien debt, a subsidiary of AREP will
acquire approximately 14% of the common stock of WestPoint
International, Inc.  Pursuant to the sale agreement, the holders
of WestPoint Stevens' first and second lien debt will be given
rights to subscribe for additional shares of common stock
representing 47.5% of the common stock of WestPoint International,
Inc.  A subsidiary of AREP has agreed to subscribe to its portion
of the rights and will thereby acquire not less than an additional
19% of the common stock of WestPoint International, Inc., at a
cost of approximately $50 million.  AREP has also agreed to
subscribe for any unexercised rights and may acquire up to an
additional 27% of the common stock of WestPoint International,
Inc., at a cost of approximately $75 million if other first and
second lien holders exercise none of the rights. Finally, a
subsidiary of AREP made an investment of $187 million in exchange
for 17.5% of the common stock of WestPoint International, Inc.  
Accordingly, AREP will own up to 79% of the equity of WestPoint
International, Inc., an amount that may reduce to 51% in the event
that the other recipients of the subscription rights exercise all
of their rights.

Following the sale, WestPoint Stevens will wind down its estate,
and as a result, all shares of its common stock will be cancelled
with no payment.

Carl C. Icahn, Chairman of the Board of AREP's general partner
stated, "We believe that the home textiles industry remains a
large and profitable market in which WestPoint can create
sustainable competitive advantage.  WestPoint's assets -- built
over decades of investment -- are substantial, including its
manufacturing expertise, capital assets, personnel, brands,
distribution skills, and customer relationships.  While others
worry about the challenges faced by industries in change, we see
these challenges as presenting the opportunity for the emergence
of a well-capitalized, industry-leading player, especially with
the present meaningful infusion of capital from AREP.  We also
look forward to providing additional equity capital in the future
for meaningful growth opportunities which we believe will become
available."

M.L. "Chip" Fontenot, President and CEO of WestPoint Stevens
commented, "AREP's investment is an important milestone in
WestPoint's transition toward becoming a more global player in the
home textiles industry.  New capital invested in our business will
give us the freedom and financial resources to focus with renewed
vigor on growth and the next stage of our transformation."

American Real Estate Partners, L.P., a master limited partnership,
is a diversified holding company engaged in a variety of
businesses.  AREP's businesses currently include gaming; oil & gas
exploration and production; and real estate.

Headquartered in West Point, Georgia, WestPoint Stevens, Inc., --
http://www.westpointstevens.com/-- is the #1 US maker of bed  
linens and bath towels and also makes comforters, blankets,
pillows, table covers, and window trimmings.  It makes the Martex,
Utica, Stevens, Lady Pepperell, Grand Patrician, and Vellux
brands, as well as the Martha Stewart bed and bath lines; other
licensed brands include Ralph Lauren, Disney, and Joe Boxer.
Department stores, mass retailers, and bed and bath stores are its
main customers.  (Federated, J.C. Penney, Kmart, Sears, and Target
account for more than half of sales.) It also has nearly 60 outlet
stores.  Chairman and CEO Holcombe Green controls 8% of WestPoint
Stevens.  The Company filed for chapter 11 protection on
June 1, 2003 (Bankr. S.D.N.Y. Case No. 03-13532).  John J.
Rapisardi, Esq., at Weil, Gotshal & Manges, LLP, represents the
Debtors in their restructuring efforts. (WestPoint Bankruptcy
News, Issue No. 52; Bankruptcy Creditors' Service, Inc.,
215/945-7000)


WESTPOINT STEVENS: R2 Top Hat Balks at Disclosure Statement
-----------------------------------------------------------
R2 Top Hat, Ltd., formerly the largest and still a holder of
claims under the First Lien Credit Agreement, asserts that the
Amended Disclosure Statement fails to provide adequate information
about:

    a. the amounts currently outstanding under the First Lien
       Credit Agreement; and

    b. the prospective recoveries available to the First Lien
       Lenders under WestPoint Stevens, Inc. and its debtor-
       affiliates' Amended Plan of Reorganization.

Dennis C. O'Donnell, Esq., at Milbank, Tweed, Hadley & McCloy,
LLP, in New York, relates that the Disclosure Statement currently
states that "the net Claims arising under the First Lien [Credit]
Agreement, assuming the accrual of postpetition interest and
application of adequate protection payments, against all accrued
interest" is $483,897,447.  Based on the reference to application
of "adequate protection payment," Mr. O'Donnell says, one must
assume that the aggregate total reflects the payment of the fees
and expense incurred by, first, Bank of America, NA, and then,
Beal Bank, SSB, as administrative Agent under the First Lien
Credit Agreement during the course of the Debtors' Chapter 11
cases.

However, Mr. O'Donnell notes that any reference to fees and
expenses incurred by individual First Lien Lenders in connection
with the Debtors' Chapter 11 case is missing in the Disclosure
Statement.  The First Lien Credit Agreement provides that
WestPoint Stevens, Inc., will "pay on demand all costs and
expenses of the Agent and the Banks, if any (including without
limitation, reasonable attorneys' fees and expenses and the cost
of internal counsel), in connection with the enforcement (whether
through negotiations, legal proceedings, or otherwise) of the
Credit Documents and the other documents to be delivered
hereunder."

According to Mr. O'Donnell, the First Lien Lenders' claims were at
all times oversecured as evidenced by:

    -- the Adequate Protection Order entered on June 18, 2003,
       which deemed all claims under the First Lien Credit
       Agreement to be oversecured;

    -- the "Going Concern Valuation Report" presented to the First
       Lien Lenders by Rothschild, Inc., on September 20, 2004,
       which concluded that WestPoint had an enterprise value
       exceeding the value of the allowed First Lien Lenders'
       claims -- about $490 million -- by more than $50 million;
       and

    -- the U.S. Bankruptcy Court for the Southern District of New
       York's July 8, 2005 Order approving the sale of
       substantially all of WestPoint's assets, which concluded
       that the First Lien Debt will be satisfied in full at
       Closing based on the fact that the Debtors received in the
       recently conducted auction of their assets at least
       $95 million of value in excess of the claims of the First
       Lien Lenders.

On August 1, 2005, R2 filed an Application for Allowance of Fees
and Expenses Pursuant to Section 506(b) of the Bankruptcy Code,
seeking $1,055,614 in legal, financial advisory, and due diligence
fees that were necessarily and reasonably incurred in connection
with the Debtors' Chapter 11 cases.  R2 has reason to believe that
other First Lien Lenders may have incurred similar fees and
expenses and have the same right to reimbursement under the First
Lien Credit Agreement.

Thus, Mr. O'Donnell asserts that the Disclosure Statement fails to
provide adequate information about the amounts outstanding under
the First Lien Credit Agreement within meaning of Section 1125 of
the Bankruptcy Code to the extent that it fails to disclose:

    a. the First Lien Lender's right to reimbursement of
       individual fees and expenses under the First Lien Credit
       Agreement;

    b. the amount of fees and expenses sought by R2 in the R2
       Application; and

    c. the possibility that other First Lien Lenders may have
       similar fee and expense reimbursement claims.

                      Prospective Recoveries

Owing to the lack of complete information about the outstanding
amount of the First Lien Lender Claims, Mr. O'Donnell points out
that the Disclosure Statement also fails to provide adequate
information regarding the prospective recoveries available to the
First Lien Lenders under the Plan.  As currently proposed, the
Disclosure Statement states that the "estimated recovery" as to
the First Lien Lender Claims is to be disclosed.

Presumably, the Debtors plan to amend the Disclosure Statement to
reflect the result of the recent auction of substantially all
their assets and in this context, will insert into the Disclosure
Statement recover chart an "estimated recovery" percentage that
reflects the distributions mandated by the Sale Approval Order.
However, without an accurate aggregate total of the amount
outstanding under the First Lien Credit Agreement, Mr. O'Donnell
says, any percentage amount proposed to be inserted by the
Debtors could not itself be accurate.

Moreover, Mr. O'Donnell continues, to the extent that the
distribution to the lenders under the Second Lien Credit
Agreement contemplated by the Plan and approved by the Sale
Approval Order is predicated on the First Lien Lender Claims being
"satisfied in full," this condition could only be satisfied to the
extent that all amounts owing to the First Lien Lenders are paid
upon consummation of the Plan.

Accordingly, Mr. O'Donnell asserts that the failure to include in
the current calculation any fee and expense amounts owed to
individual First Lien Lenders both:

    a. mandates denial of approval of the Disclosure Statement
       under Section 1125 of the Bankruptcy Code; and

    b. calls into question the confirmability of the Plan under
       Section 1129 of the Bankruptcy Code.

Headquartered in West Point, Georgia, WestPoint Stevens, Inc., --
http://www.westpointstevens.com/-- is the #1 US maker of bed  
linens and bath towels and also makes comforters, blankets,
pillows, table covers, and window trimmings.  It makes the Martex,
Utica, Stevens, Lady Pepperell, Grand Patrician, and Vellux
brands, as well as the Martha Stewart bed and bath lines; other
licensed brands include Ralph Lauren, Disney, and Joe Boxer.
Department stores, mass retailers, and bed and bath stores are its
main customers.  (Federated, J.C. Penney, Kmart, Sears, and Target
account for more than half of sales.) It also has nearly 60 outlet
stores.  Chairman and CEO Holcombe Green controls 8% of WestPoint
Stevens.  The Company filed for chapter 11 protection on
June 1, 2003 (Bankr. S.D.N.Y. Case No. 03-13532).  John J.
Rapisardi, Esq., at Weil, Gotshal & Manges, LLP, represents the
Debtors in their restructuring efforts. (WestPoint Bankruptcy
News, Issue No. 52; Bankruptcy Creditors' Service, Inc.,
215/945-7000)


WESTPOINT STEVENS: Steering Board Asks for Re-Evaluation Hearing
----------------------------------------------------------------
Contrarian Funds, LLC, Satellite Senior Income Fund, LLC, CP
Capital Investments, LLC, Wayland Distressed Opportunities Fund
I-B, LLC, and Wayland Distressed Opportunities Fund I-C, LLC, ask
the Court to determine that, due to changed circumstances which
materially affect the value of the Successful Bid, the
Subscription Rights as allocated in the Sale Order, together with
release of any other Sale consideration to the First Lien
Lenders, will not satisfy the claim of the First Lien Lenders in
full.

The Steering Committee believes that evidence collected since the
auction demonstrates that the value of the Successful Bid such the
Subscription Rights as allocated in the Sale Order together with
release of any other Sale consideration to the First Lien Lenders
will not satisfy the claim of the First Lien Lenders in full.

The Steering Committee asks the Court to set a hearing prior to
the August 8, 2005 Sale Closing to address the matter.

                       Funds Respond

GSC Partners, Pequot Capital Management, Inc., and Perry
Principals, LLC, asserts that the Steering Committee's request
contains completely conclusory allegations that provide no one
with any inkling of what the Steering Committee means by the
"changed circumstances" and "evidence collected since the
Auction" that purportedly entitle them to the hearing.

According to Mark Thompson, Esq., at Simpson Thacher & Bartlett
LLP, in New York, the Funds are not aware of any "changed
circumstances" that might conceivably lead to a re-valuation of
those assets.  Mr. Thompson notes that the Steering Committee's
Motion provides no basis for believing that any circumstances have
occurred, or that the Steering Committee are doing anything other
than seeking to re-litigate the issues they have already pursued,
vigorously but unsuccessfully, throughout several days of hearings
just recently.

The Steering Committee's conclusory allegations appear to be
nothing more than a desperate attempt to gain an improper
advantage in the Court by concealing their case, Mr. Thompson
notes.  This strategy not only demonstrates the weakness of the
Steering Committee's case, he says, but frustrates the adversary
system and disserves the judicial process.  While "notice
pleading" may be tolerated where a litigation proceeds on a
schedule that affords plenty of time for discovery, Mr. Thompson
asserts, moving papers of a conclusory nature should not form the
basis of multi-million dollar litigation on abbreviated notice.

Mr. Thompson argues that the Motion should be denied without
prejudice to the Steering Committee's re-filing a motion that
provides substantive detail behind their allegations.  Moreover,
he continues, to the extent that the Steering Committee seeks a
hearing on notice shorter than 10 days, it should be required to
provide the Debtors, the Funds, Wilmington Trust Company, as
Second Lien Agent, and Aretex, LLC, with at least 10 days notice
of all evidence they intend to offer in support of the relief
requested, copies of any documentary evidence to be offered, and
to make the witnesses available for deposition, so that the
potential adversaries can prepare cross-examination, expert
witnesses and other elements of a case in opposition, thereby
giving the Court the benefit of a fair presentation of the issues.

Headquartered in West Point, Georgia, WestPoint Stevens, Inc., --
http://www.westpointstevens.com/-- is the #1 US maker of bed  
linens and bath towels and also makes comforters, blankets,
pillows, table covers, and window trimmings.  It makes the Martex,
Utica, Stevens, Lady Pepperell, Grand Patrician, and Vellux
brands, as well as the Martha Stewart bed and bath lines; other
licensed brands include Ralph Lauren, Disney, and Joe Boxer.
Department stores, mass retailers, and bed and bath stores are its
main customers.  (Federated, J.C. Penney, Kmart, Sears, and Target
account for more than half of sales.) It also has nearly 60 outlet
stores.  Chairman and CEO Holcombe Green controls 8% of WestPoint
Stevens.  The Company filed for chapter 11 protection on
June 1, 2003 (Bankr. S.D.N.Y. Case No. 03-13532).  John J.
Rapisardi, Esq., at Weil, Gotshal & Manges, LLP, represents the
Debtors in their restructuring efforts. (WestPoint Bankruptcy
News, Issue No. 52; Bankruptcy Creditors' Service, Inc.,
215/945-7000)


WISTON XIV: U.S. Trustee Wants Bankruptcy Case Dismissed
--------------------------------------------------------
Charles E. Rendlen, III, the U.S. Trustee for Region 13, asks the
U.S. Bankruptcy Court for the District of Nebraska to dismiss the
chapter 11 case of Wiston XIV Limited Partnership.  

The U.S. Trustee reminds the Court that the Debtor's secured
creditor, Sapient Capital, LLC, obtained relief from the automatic
stay on July 14, 2005.  As a result, Sapient can now foreclose on
its collateral.  Without those assets, it will be impossible for
the Debtor to effectuate a plan of reorganization.  

Also, the U.S. Trustee recalls, the Court denied the Debtor's
request to borrow more funds.  The Debtor has no financial ability
to repair its damaged property that might have resulted in a
higher going concern value for the estate.

Mr. Rendlen also complains that the Debtor hasn't paid second
quarter fees to the U.S. Trustee's Office.  

For these reasons, Mr. Rendlen believes the Debtor's case should
be dismissed.

Headquartered in Stilwell, Kansas, Wiston XIV Limited Partnership
filed for chapter 11 protection on Jan. 5, 2005 (Bankr. D. Nebr.
Case No. 05-80037).  Robert V. Ginn, Esq., at Brashear & Ginn,
represents the Debtor in its restructuring efforts.  When the
Debtor filed for protection from its creditors, it estimated
assets between $10 million and $50 million and estimated debts
from $10 million to $50 million.


YUKOS OIL: Losses in 2nd Quarter 2005 Exceed Rub4 Billion
---------------------------------------------------------
According to RosBusinessConsulting, Yukos Oil Company reported a
net loss of RUB4.204 billion in the second quarter of 2005.  The
company's 2005 2nd quarter net loss shows a decline of 13.5% as
compared to the losses recorded for the same period in 2004.

Headquartered in Houston, Texas, Yukos Oil Company is an open
joint stock company existing under the laws of the Russian
Federation.  Yukos is involved in the energy industry
substantially through its ownership of its various subsidiaries,
which own or are otherwise entitled to enjoy certain rights to oil
and gas production, refining and marketing assets.  The Company
filed for chapter 11 protection on Dec. 14, 2004 (Bankr. S.D. Tex.
Case No. 04-47742).  Zack A. Clement, Esq., C. Mark Baker, Esq.,
Evelyn H. Biery, Esq., John A. Barrett, Esq., Johnathan C. Bolton,
Esq., R. Andrew Black, Esq., Fulbright & Jaworski, LLP, represent
the Debtor in its restructuring efforts.  When the Debtor filed
for protection from its creditors, it listed $12,276,000,000
in total assets and $30,790,000,000 in total debts.  On
Feb. 24, 2005, Judge Letitia Z. Clark dismissed the Chapter 11
case.  (Yukos Bankruptcy News, Issue No. 24; Bankruptcy Creditors'
Service, Inc., 215/945-7000)


Z-1 CDO: Fitch Holds Junk Rating on $21MM Class B Certificates
--------------------------------------------------------------
Fitch Ratings affirms one class of the notes issued by Z-1 CDO
1996-1 Ltd.  The affirmation of this note is a result of Fitch's
rating review process.  These rating actions are effective
immediately:

    -- $153,281,380 class A-2 notes affirm at 'AAA';
    -- $21,000,000 class B notes remain at 'CC'.

Z-1 CDO, a corporate collateralized debt obligation (CDO) that
closed on Oct. 31, 1996, is currently managed by Patriarch
Partners, LLC.  Patriarch began managing the portfolio as of May
2, 2003 for their expertise in distressed debt portfolios.  The
fund was originally established to invest in a portfolio of senior
unsecured, subordinated, and emerging market debt securities.

The class A-2 notes are wrapped by MBIA Insurance Corp., rated
'AAA' by Fitch.  The transaction continues to deleverage, with
approximately 60% of the original class A-2 balance outstanding.  
As of the May 2005 payment report, there were insufficient
interest proceeds to pay current interest on the class A-2 notes.
The interest shortfall to the A-2 notes was paid through the
application of principal proceeds.  The entire class B coupon
continues to be paid with principal proceeds, with the reminder of
principal being applied to redeem the A-2 notes.

Due to the use of principal to pay interest, the
overcollaterization levels have declined since the last rating
affirmation.  The class B notes are projected to receive current
interest until maturity with no ultimate principal recovery.

Transaction information and historical data on Z-1 CDO are
available on the Fitch Ratings' web site at
http://www.fitchratings.com/For more information on the Fitch  
VECTOR Model, see 'Global Rating Criteria for Collateralized Debt
Obligations,' dated Sept. 13, 2004, also available at
http://www.fitchratings.com/


* Edmund Cooke Joins Mintz Levin's Washington D.C. Office
---------------------------------------------------------
Edmund Cooke, a nationally recognized expert in diversity
counseling and audits, and six other prominent employment law
attorneys have come together to join the Washington, D.C. office
of Mintz, Levin, Cohn, Ferris, Glovsky and Popeo, P.C.

Mr. Cooke, formerly a partner in the labor and employment practice
at Venable, LLP, is joined by:

   -- Robert Clayton former partner at Epstein, Becker & Green and
      Associate Dean of Tulane Law School;

   -- Singleton McAllister, formerly of Sonnenschein, Nath &
      Rosenthal where she chaired its National Corporate Diversity
      Counseling Group;

   -- O'Kelly E. McWilliams III, formerly a partner with Pepper
      Hamilton;

   -- Gilbert Casellas, former Chairman of the Equal Employment
      Opportunity Commission and former general counsel for the
      United States Air Force;

   -- Randall Robertson, former associate general counsel at MCI
      WorldCom, Inc.;

   -- Darlene Smith, formerly at McNamee, Hosea, Jernigan, Kim,
      Greenan and Walker; and

   -- Sheila Owsley most recently with Jackson Lewis, LLP.

In addition, R. Wesley Alexander, Jennifer Persico, Karen Vossler
and Tyron Thomas have joined the Washington, D.C. office as
associates in the employment, labor and benefits section.

Mintz Levin has added a total of 10 new Members (partners) and
four Of-Counsel to its offices in the greater Washington area in
the last 12 months adding to its Business and Finance,
Communications, Federal and Employment, Labor and Benefits
Sections.

The D.C. employment group's practice will focus on preventative
law involving company-wide diversity audits, internal
investigations involving workplace discrimination and harassment,
advice and counseling on EEO-related employment issues,
arbitration, mediation and employment litigation and counsel to
universities on NCAA, Title IX and Title XI compliance issues. In
addition, the strong government relations backgrounds of Mr. Cooke
who served eight years as staff counsel to the U.S. House of
Representatives and as Deputy Director of the EEOC's Office of
Field Service, Ms. McAllister, who was the general counsel of
USAID and Mr. Casellas with his experience at EEOC and the US Air
Force, will benefit clients needing assistance with government
procurement and appropriations.

"This is a dynamic group of people," said Cherie Kiser, Managing
Member of the firm's Washington, D.C. office, Chair of the
Communications and Technology Section and Chair of the Diversity
Committee. "They bring distinct expertise in employment law
generally, and specifically as it relates to diversity issues. In
addition, their deep commitment to creating a lasting legacy for
future generations of minority attorneys is an integral part of
this firm's mission and tradition with regard to providing an
environment of opportunity for all of our employees."

"Mintz Levin's international client base and excellent reputation
not only in employment law, but across a number of practice areas,
provides us with the opportunity to build a vibrant and
sustainable practice," added Mr. Cooke.

Mintz Levin's commitment to diversity dates back to its beginnings
in 1933 when three Jewish lawyers who themselves, felt
disenfranchised from the Boston legal community, joined together
to start a firm. Since then, Mintz Levin has continued its efforts
in this area including being one of the founding firms who, in
1986, created the Boston Lawyers Group (BLG). The BLG is a
nonprofit organization founded by a consortium of major Boston
firms committed to improving the hiring and retention of attorneys
of color.

Mintz Levin elected its first female partner in 1966. Today, Mintz
Levin's women partners lead numerous practice groups within the
Firm and serve on the firm's Policy Committee. Nearly half of all
attorneys at the firm are women. Since 1993, the Firm has offered
employee benefits to same-sex partners.

Mintz Levin's employment, labor and employee benefits attorneys
are joined together as one group to provide clients with a
consolidated approach to human resources issues. They provide
clients with informed advice on not only the most recent
developments in the law but also current trends in employment and
compensation practices. Mintz Levin' s objective is to assist
clients in meeting their business goals while minimizing employee-
related conflicts. The firm's clients represent a broad cross-
section of the community, encompassing a spectrum of industries
including manufacturing, retail, high technology, biotechnology,
health care, education, hospitality, finance, construction,
agriculture, and professional services.

Mintz, Levin, Cohn, Ferris, Glovsky and Popeo, PC --
http://www.mintz.com/-- is a multidisciplinary law firm with over  
450 attorneys and senior professionals in Boston, Washington D.C.,
Reston, VA, New York, Stamford, CT, Los Angeles and London.

Mintz Levin is distinguished by its reputation for responsive
client service and expertise in the areas of bankruptcy; business
and finance; communications; employment; environmental; antitrust
and federal regulatory; health care; immigration; intellectual
property; litigation; public finance; real estate; tax; and trusts
and estates. Mintz Levin's international clientele range from
privately held start-ups to Fortune 100 companies in a wide array
of industries including biotechnology, venture capital,
telecommunications, health care and high technology.

Mintz Levin was one of the first law firms to develop
complementary consulting capabilities to provide complete
solutions to clients' problems, including investment/wealth
management, government and public affairs and transactional
insurance.

                          *********

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 ***