TCR_Public/050831.mbx       T R O U B L E D   C O M P A N Y   R E P O R T E R

         Wednesday, August 31, 2005, Vol. 9, No. 206

                          Headlines

ACCIDENT & INJURY: Files Amended Disclosure Statement in Dallas
ACCIDENT & INJURY: Gets Court Nod on Merger Deal with Subsidiaries
ACCIDENT & INJURY: Retains Edward Swalm to Prepare Tax Returns
ADELPHIA COMMS: Arahova Panel Appeals Dispute Resolution Process
ADELPHIA COMMS: Arahova Panel Appeals Order on Amended Schedules

AGGRECON CONCRETE: Case Summary & 20 Largest Unsecured Creditors
ALOHA AIR: Governmental Claims Bar Date Set for Oct. 28
AMHERST TECHNOLOGIES: Court Fixes Nov. 17 Claims Bar Date
ANTHRACITE CDO: Fitch Lifts Rating on $10MM Notes 1 Notch to BB+
ARCAP 2004-1: Fitch Affirms Low-B Rating on Two Cert. Classes

ARCAP 2004-RR3: Fitch Holds Low-B Rating on Six Cert. Classes
ARLINGTON HOSPITALITY: Nasdaq to Halt Securities Trading Tomorrow
ARMSTRONG WORLD: Wants Plan Filing Period Stretched to March 6
ASARCO LLC: Wants Bracewell as Special Litigation Counsel
ASARCO LLC: Taps Quarles as Special Counsel to Tackle Labor Issues

ASARCO LLC: Asks Court to Bless 2005 Environmental Clean-Up Budget
ATA AIRLINES: Court Extends Plan-Filing Period Until Sept. 30
ATKINS NUTRITIONALS: U.S. Trustee Picks 5-Member Creditors Panel
ATKINS NUTRITIONALS: Gets Final Court Nod to Use Cash Collateral
AVCORP INDUSTRIES: Issuing 3.2 Million Stock via Private Placement

BLEECKER STRUCTURED: Poor Credit Quality Cues Fitch's Downgrade
BUTLER INTERNATIONAL: Financial Filing Delay Cues Nasdaq Notice
CELESTICA INC: Redeeming $2.15 Million LYONs for $1.24 Million
CLEARLY CANADIAN: June 30 Stockholders' Equity Soars by $4 Million
CONSECO INC: Shareholders Re-Elect Directors & OK PwC as Auditors

CYPRESS SEMICONDUCTOR: SunPower to Conduct $115 Million IPO
DIRECTVIEW INC: Balance Sheet Upside-Down by $1.34-Mil at June 30
DOANE PET: Sells Business to Teachers' Private Capital for $840MM
DOANE PET: S&P Places B Corporate Credit Rating on Watch Positive
E.DIGITAL CORP: Equity Deficit Widens to $2.79 Million at June 30

E.DIGITAL CORP: Needs $1 Million for the Next Year to Operate
EAGLEPICHER INC: GE Railcar Demands Decision on Lease Agreement
ENRON CORP: Gets Court Nod to Amend DCR Guidelines
FARMLAND INDUSTRIES: Trustee Wants to Sell $3.6M Equity Interests
FASSBERG CONSTRUCTION: List of 20 Largest Unsecured Creditors

FASSBERG CONSTRUCTION: Taps Schwartz Janzen as Litigation Counsel
FIRST LIBERTY: Case Summary & 20 Largest Unsecured Creditors
FONIX CORP: June 30 Balance Sheet Upside-Down by $5 Million
FOOTSTAR INC: Judge Hardin Approves Settlement Pact with Sears
G-STAR 2002-1: Fitch Lifts Rating on $16MM Notes 1 Notch to BBB-

GASEL TRANSPORTATION: Wants to Convert Case to Chapter 7
GREAT LAKES: S&P Says Junk Debt Ratings Remain on Negative Watch
HANGER ORTHOPEDIC: Lenders Okay Credit Loan Amendments
HOLLINGER INT'L: Expects to File 2004 Annual Report by Sept. 15
HOMESTEADS: Court Orders Conversion to Chapter 7 Liquidation

INTELSAT LTD: Inks Pact to Buy PanAmSat for $3.2 Billion
JORDAN INDUSTRIES: Balance Sheet Upside-Down by $250MM at June 30
JOY GLOBAL: Earns $31 Million of Net Income in Third Quarter
JP MORGAN: Fitch Affirms Low-B Rating on Five Certificate Classes
KAISER ALUMINUM: Exclusive Periods Extended Until September 30

KB TOYS: Emerges From Bankruptcy Protection
KMART CORP: Court Denies Boorman's Motion to File Late Claim
LEXAM EXPLORATION: June 30 Equity Deficit Widens to C$507,915
LEXAM EXPLORATION: Goldcorp Sells Equity Stake to CEO R. McEwen
MACH ONE: Fitch Retains Low-B Rating on Six Certificate Classes

MADISON SQUARE: Recent Paydown Prompts Fitch to Raise Ratings
MARKLAND TECH: Releases Unaudited Fiscal 2005 Financial Results
MCDERMOTT INT'L: To Pay $350 Million to B&W's Asbestos PI Trust
MCLEODUSA INC: Cuts 240 Jobs as Part of Restructuring Plans
MEDICAL TECHNOLOGY: Two Patent Owners Want Ch. 11 Case Dismissed

MEDICAL TECHNOLOGY: Wants Appraisal Services as Appraiser
MERCURY INTERACTIVE: Financial Filing Delay Prompts Default Notice
MERCURY INTERACTIVE: Restating Financials for Three Fiscal Years
MILLENNIUM AMERICA: Buying Back $350 Mil. of 7% Sr. Notes for Cash
MIRANT CORP: U.S. Trustee Alters MAGi Committee Membership

MIRANT CORP: Chapter 11 Examiner Files Seventh Interim Report
MIRANT CORP: Court Approves Collateral Transfer Agreement
MOBIFON HOLDINGS: Won't File Quarterly Report Within Deadline
MORGAN STANLEY: Fitch Upgrades $5.8 Mil Class J Certs. to BB+
MORGAN STANLEY: Fitch Affirms Low-B Rating on Six Cert. Classes

MQ ASSOCIATES: Consent Solicitation Expires Today
NDCHEALTH CORP: Sells Business to Per-Se & Wolters for $1 Billion
OMNI ENERGY: Completes $25 Million Term B Credit Facility
PACEL CORP: Completes Debt Restructuring with Lenders
PANAMSAT HOLDING: Inks Pact to Merge with Intelsat for $3.2-Bil

PANAMSAT CORP: S&P Places BB Corporate Credit Rating on Watch
PEACE ARCH: Shareholders Okay Creation of Preference Shares
PENINSULA HOLDING: Iskum Wants Stay Lifted to Effect Foreclosure
PEREGRINE SYSTEMS: Distributing Stock Reserve to Ex-Stockholders
PHARMACEUTICAL FORMULATIONS: Hires Young Conaway as Counsel

PHARMACEUTICAL FORMULATIONS: UST Picks 7-Member Creditors Panel
PER-SE TECHNOLOGIES: S&P Puts B+ Corporate Credit Rating on Watch
PREMIER ENTERTAINMENT: S&P Puts Corporate Credit Rating on Watch
PROXIM CORP: Asks Court to Set September 30 as Claims Bar Date
RESCARE INC: Buying Back 10-5/8% Senior Notes Until Sept. 27

SAKS INC: Gets Offers for Units as Whole Business Gets Snubbed
SALTON INC: Completes Private Debt Exchange Offer
SALTON INC: Raises $80 Mil. from Sale of South African Interest
SERVICE CORPORATION: Reports Preliminary Results for 2nd Quarter
SERVICE CORP: To Restate Previously Issued Financial Statements

SONORAN ENERGY: Working Capital Deficit Cues Going Concern Doubt
STERIGENICS INT'L: S&P Rates Planned $217 Mil. Term Loan B at B+
STEVE KING: Case Summary & 17 Largest Unsecured Creditors
STRATUS SERVICES: Balance Sheet Upside Down by $4.25MM at June 30
TELESYSTEM INT'L: Court Okays $4.2B Distribution to Shareholders

TRENWICK GROUP: Two Creditors Want Dismissal Order Vacated
VARICK STRUCTURED: Credit Quality Slump Cues Fitch to Cut Ratings
VILLAGES AT SARATOGA: Case Summary & 8 Unsecured Creditors
W.R. GRACE: Wants to Assume & Assign Pa. Lease to Rising Sun
WATERMAN INDUSTRIES: Submits Case Status Report to Judge Lee

WORLDCOM INC: Sharon Byrd Wants Stay Lifted to Pursue Claim
WORLDCOM INC: Moves for Summary Judgment on Waldinger's Claim
WET SEAL: Posts $11.7MM Net Loss for 13-Weeks Ended July 30, 2005

* Upcoming Meetings, Conferences and Seminars

                          *********

ACCIDENT & INJURY: Files Amended Disclosure Statement in Dallas
---------------------------------------------------------------
Accident & Injury Pain Centers, Inc., and its debtor-affiliates
delivered their Third Amended Joint Plan of Reorganization and a
Disclosure Statement explaining that Plan to the U.S. Bankruptcy
Court for the Northern District of Texas in Dallas.

The Plan proposes to retain the Debtors' pre-petition ownership
and management structure.  The Plan also provides for the pre-
confirmation merger of Accident & Injury with the other debtor-
affiliates.  

A Creditors Distribution Trust, created pursuant to the Plan, will
be responsible for the distribution of funds to holders of Allowed
Unsecured Non Priority Claims.    

The Trust will hold all equity interests in the Debtors until all
allowed claims have been paid in full.  Thereafter, the equity
interests will be disbursed to Bob Smith and allowed subordinated
claims of insiders will be paid.

                    Treatment of Claims

The Plan will separately treat the claims filed against Accident &
Injury Pain Centers, Inc., its affiliated limited liability
companies, and Accident & Injury's principals Robert Smith and
Stephen Arthur Smith.

The allowed secured claim of Comerica against Accident & Injury,
consisting of approximately $1.7 million in account receivables
and $135,499 in equipment obligations, will be paid, with interest
at the original rate, in equal monthly installments over a three-
year period.   

North Texas' Equipment Obligation to Comerica ($314,783 of which
is on account of the North Texas MRI equipment notes and $95,000
pertaining to the North Texas MRI term notes), will be paid in
equal monthly installments, with interest at the original rate,
over the period from the Effective Date of the Plan through
January 2007.
   
White Rock's Term Obligation to Comerica, totaling $105,000 as of
September 30, 2005, will be paid in equal monthly installments,
with interest at the original rate, from the effective date of the
Plan through January 2007.

The allowed secured claim of Northeast Bancshares, Inc., against
White Rock, consisting of equipment obligation totaling $284,170,
will be paid, with interest at the original rate, in equal
amortizing monthly installments over a five-period.

The allowed secured claims of Northeast Bancshares against Rehab
2112, totaling $23,407, will be paid in equal amortizing monthly
installments over a five-year period, with interest at the
original rate.  The first installment is due on the Initial Plan
Distribution Date.

Receivable Finance will apply the certificates of deposit and
money market accounts securing Northeast Bancshares' claims to
satisfy these claims.  Any excess funds after the application of
the collateral will be transferred to the Creditors Distribution
Trust.

The Allowed Secured Claim of Colonial Savings against Bob Smith
will be paid in full over a 327-month period with interest at
5.75%.

Steve Smith will continue making payments in accordance with the
terms of the Countrywide Home Loans note and Countrywide Home will
retain its lien until its allowed secured claim is fully paid.

Accrued interest on Wells Fargo Home Mortgage's allowed secured
claim against Steve Smith will be paid on the Initial Plan
Distribution date.  The balance will be paid in monthly
installments for the first 24 months following the Initial Plan
Distribution date.  On the 25th month following the Initial Plan
Distribution date, any balance will be amortized over a 30-year
period and will be paid in equal monthly installments at the
original interest rate.

The allowed secured claim of Town North Bank, N.A., against Steve
Smith will be paid on the same terms as the Wells Fargo Home
Mortgage claim.

Allstate and Encompass' asserted secured garnishment claim against
the Debtors is subject to Comerica's setoff right and the class
will therefore receive nothing under the Plan.

Holders of allowed unsecured claims electing to reduce their
claims to $5,000 will receive that reduced amount in full in four
equal quarterly installments with the first payment beginning on
the Initial Plan Distribution Date.  

Holders of allowed general unsecured claims will be paid in full
with interest at the rate of 2.89% per annum over a 60-month
period beginning on the Initial Plan Distribution Date.  Each of
the Debtors will make these minimum monthly payments to the
Creditors Distribution Trust to meet the payment requirement for
this class:

     Debtor                       Minimum Monthly Contribution
     ------                       -----------------------------
     Accident & Injury                      $201,735
     Rehab 2112                               12,584
     North Texas                              12,125
     Lone Star                                11,890
     White Rock                               17,385
     Steve Smith                               2,000  
     Bob Smith                                 3,000

Holders of equity interests receive nothing under the Plan.  
Reorganized A&I will issue 100% of its common stock to Bob Smith.

                          Plan Funding

Payments to allowed Claims against the Debtors under the Plan will
be paid from:
   
     a) any income generated by property of a Debtor;
     
     b) proceeds from sales of property of a Debtor
     
     c) recoveries from Causes of Action retained by a Debtor;
    
     d) cash flow, after payment of normal and ordinary costs of
        operation, of a Debtor; and
     
     e) from the Plan Funding Reserve.

A schedule of the Debtors' assets as of the Plan Filing is
available for free at:

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

            Continuance of Allstate Civil Action

The judgment and related verdict on the civil action styled
Allstate Insurance Company, et al. v. Receivable Finance Company,
L.L.C., et al. (Civil Action No. 01-CV-2247-N) is on appeal in the
Fifth Circuit Court of Appeals.  The Debtors seek reversal of the
judgment.  The Debtors' liability in this action, if any, will not
be discharged under the Plan.  

Headquartered in Dallas, Texas, Accident & Injury Pain Centers,
Inc. -- http://www.accinj.com/-- operates clinics that treat   
patients with highly advanced therapy equipment and techniques.
The Company and its debtor-affiliates filed for chapter 11
protection on Feb. 10, 2005 (Bankr. N.D. Tex. Case No. 05-31688).
Glenn A. Portman, Esq., at Bennett, Weston & LaJone, P.C.,
represents the Debtors in their restructuring efforts.  When the
Debtors filed for protection from their creditors, they reported
estimated assets and debts of $10 million to $50 million.


ACCIDENT & INJURY: Gets Court Nod on Merger Deal with Subsidiaries
------------------------------------------------------------------
The Hon. Harlin DeWayne Hale of the U.S. Bankruptcy Court for the
Northern District of Texas in Dallas gave Accident & Injury Pain
Centers, Inc., permission to consummate an upstream merger with
its wholly owned corporate subsidiaries.

The corporate subsidiaries merging with Accident & Injury are:

   * Accident & Injury Pain Center of North Garland, Inc.;
   * Accident & Injury Pain Center Of Mesquite, Inc.;
   * Accident & Injury Pain Center Of Oak Cliff - South, Inc.; and
   * Metroplex Pain Center, Inc.

As previously reported in the Troubled Company Reporter,
Accident & Injury Pain Centers, Inc., as the surviving entity,
will assume all liabilities of the subsidiaries.  Pursuant to the
merger, all claims against the subsidiaries will be reclassified
as claims against Accident & Injury.

A list of the claims filed against the debtor-subsidiaries is
available for free at:

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

A copy of the initial draft of the Debtors' plan and articles of
merger is available for free at:

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

Headquartered in Dallas, Texas, Accident & Injury Pain Centers,
Inc. -- http://www.accinj.com/-- operates clinics that treat   
patients with highly advanced therapy equipment and techniques.
The Company and its debtor-affiliates filed for chapter 11
protection on Feb. 10, 2005 (Bankr. N.D. Tex. Case No. 05-31688).
Glenn A. Portman, Esq., at Bennett, Weston & LaJone, P.C.,
represents the Debtors in their restructuring efforts.  When the
Debtors filed for protection from their creditors, they reported
estimated assets and debts of $10 million to $50 million.


ACCIDENT & INJURY: Retains Edward Swalm to Prepare Tax Returns
--------------------------------------------------------------
The U.S. Bankruptcy Court for the Northern District of Texas in
Dallas gave Accident & Injury Pain Centers, Inc., and its debtor-
affiliates permission to employ Edward S. Swalm, CPA.  Mr. Swalm
will prepare the Debtors' corporate tax returns due on Sept. 15,
2005, as well as information returns for the limited liability
company debtors.

The Debtors hired Mr. Swalm and his firm Swalm & Associates, PC,
based on the recommendation of their prepetition accountants.  
Their prepetition accountants cannot serve in the Debtors case as
they have a member serving on the Official Committee of Unsecured
Creditors.

Swalm & Associates charges its clients between $75 and $250 per
hour for its services.  In this engagement, Mr. Swalm estimates
the Firm's blended hourly rate should be about $125 per hour for
the preparation of routine corporate federal income tax returns.

To the best of the Debtors' knowledge, Mr. Swalm does not hold or
represent any interest adverse to the estates and is a
disinterested person within the meaning of section 101(13) of the
Bankruptcy Code.

Headquartered in Dallas, Texas, Accident & Injury Pain Centers,
Inc. -- http://www.accinj.com/-- operates clinics that treat   
patients with highly advanced therapy equipment and techniques.
The Company and its debtor-affiliates filed for chapter 11
protection on Feb. 10, 2005 (Bankr. N.D. Tex. Case No. 05-31688).
Glenn A. Portman, Esq., at Bennett, Weston & LaJone, P.C.,
represents the Debtors in their restructuring efforts.  When the
Debtors filed for protection from their creditors, they reported
estimated assets and debts of $10 million to $50 million.


ADELPHIA COMMS: Arahova Panel Appeals Dispute Resolution Process
----------------------------------------------------------------
The Ad Hoc Committee of Arahova Noteholders is taking an appeal
from Judge Gerber's order approving the Adelphia Communications
Corporation and its debtor-affiliates' Arahova-ACC Dispute
Resolution Process to the U.S. District Court for the Southern
District of New York.

The Arahova Noteholders Committee wants the District Court to
review five issues:

    1. Did the Bankruptcy Court err in ordering expedited
       resolution procedures that contemplate that the ACOM
       Debtors will be bound by determinations with respect to all
       asserted and unasserted contested matters identified by
       creditors to the estate, on behalf of, or in defense for,
       the estate, without:

         (i) a fiduciary responsible for asserting claims or
             identifying defenses with respect to the estate; or

        (ii) counsel acting on behalf of the estate solely for the
             best interests of the estate?

    2. Did the Bankruptcy Court err in ordering sui generis
       expedited resolution procedures that supercede application
       of the Federal Rules of Bankruptcy Procedure and the
       Federal Rules of Civil Procedure, including the requirement
       for filing of complaints and answers in avoidance actions,
       the requirement for the setting of an intercompany bar date
       for filing notices of claim for intercompany disputes, and
       creation of a new pleading to be filed with the Court by
       affected creditors?

    3. Did the Bankruptcy Court err in failing to find a waiver of
       the attorney-client privilege concerning analysis and work
       performed with respect to intercompany claims as part of
       Willkie Farr & Gallagher LLP's dual representation of
       the Debtors on both sides of the intercompany claims?

    4. Did the Bankruptcy Court err in granting the Resolution
       Process on an unsupported factual record, including with
       respect to the fundamental question as to potential Debtor
       impairment, where the court denied discovery on the factual
       predicates to the Motion?

    5. Did the Bankruptcy Court err in ordering expedited
       resolution procedures that presuppose that the rights of a
       single estate can be impaired to the benefit of affiliated
       estates in an administratively, but not substantively,
       consolidated bankruptcy proceeding?

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)


ADELPHIA COMMS: Arahova Panel Appeals Order on Amended Schedules
----------------------------------------------------------------
The Ad Hoc Committee of Arahova Noteholders is taking an appeal
from Judge Gerber's order denying its request to strike Adelphia
Communications Corporation and its debtor-affiliates' May 2005
Amended Schedules to the U.S. District Court for the Southern
District of New York.

The Arahova Noteholders Committee wants the District Court to
review eight issues:

    1. Did the Bankruptcy Court err in failing to strike an
       amended intercompany schedule of claims authorized by a
       single officer of 230 separate estates of the ACOM Debtors,
       apparently signed only in his capacity as an ACOM officer?

    2. Did the Bankruptcy Court err in failing to strike an
       amended intercompany schedule of claims absent a showing
       that the schedules are entirely fair with respect to all
       Debtors?

    3. Did the Bankruptcy Court err in prohibiting any discovery
       on the Motion to Strike, including the deposition of the
       single officer of 230 separate estates of the Debtors who
       purportedly signed the declaration in support of the
       intercompany schedules on behalf of all Debtors?

    4. Did the Bankruptcy Court err in finding that the
       declaration in support of the intercompany schedules was
       signed on behalf of all Debtors when the declarant
       apparently signed it only in his capacity as an officer of
       ACOM?

    5. Did the Bankruptcy Court err in failing to strike an
       amended intercompany schedule that did not comply with the
       requirements of the Bankruptcy Code, Bankruptcy Rules or
       the Official Forms?

    6. Did the Bankruptcy Court err in holding that amendments to
       schedules filed in a bankruptcy case need not comply with
       the Bankruptcy Code's and the Bankruptcy Rules'
       requirements for originally filed schedules?

    7. Did the Bankruptcy Court err in determining that a
       declaration signed in support of the intercompany schedules
       met the requirements of the Bankruptcy Code and the
       Bankruptcy Rules where the schedules themselves contained
       improper caveats and disclaimers regarding the accuracy and
       validity of the scheduled claims?

    8. Did the Bankruptcy Court err in failing to establish an
       intercompany claims bar date or to require intercompany
       proofs of claim as required under the Bankruptcy Code?

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)


AGGRECON CONCRETE: Case Summary & 20 Largest Unsecured Creditors
----------------------------------------------------------------
Debtor: Aggrecon Concrete, Inc.
        P.O. Box 1573
        Mission, Texas 78573-0027

Bankruptcy Case No.: 05-70870

Type of Business: The Debtor is a construction company that
                  specializes in the installation of sewer and
                  water lines.

Chapter 11 Petition Date: August 29, 2005

Court: Southern District of Texas (McAllen)

Debtor's Counsel: Joe D. Garcia, Esq.
                  Law Office of Joe D. Garcia
                  809 Quince
                  McAllen, Texas 78501
                  Tel: (956) 682-7542
                  Fax: (956) 686-7872

Estimated Assets: $500,000 to $1 Million

Estimated Debts:  $1 Million to $10 Million

Debtor's 20 Largest Unsecured Creditors:

   Entity                        Nature of Claim    Claim Amount
   ------                        ---------------    ------------
Internal Revenue Service         Taxes                  $746,753
Stop 5023 AUS
300 East 8th Street
Austin, TX 78701

CEMEX                            Judgment               $570,000
1001 Fannin, Suite 4646
Houston, TX 77002

Texas Industries, Inc.           Non-purchase money     $273,532
1341 West Mockingbird Lane
Dallas, TX 75247-6913

Capitol Cement                   Non-purchase money     $176,947

Internal Revenue Service         Taxes                  $118,471

ORIX Financial Services, Inc.    Non-purchase money     $107,859

Mission C.I.S.D.                 Taxes                   $59,325

JAM Distributing Company         Non-purchase money      $37,193

Susser Petroleum Company         Judgment                $30,890

Waukesha-Pearce Industries,      Non-purchase money      $30,026
Inc.

Nueces Power Equipment           Non-purchase money      $28,260

Sascon/Haste, Inc.               Non-purchase money      $20,515

Mine Safety and Health           Non-purchase money      $16,753
Administration

Warren, Drugan & Barrows, P.C.   Judgment - attorney     $15,500
                                 fees

Austin Powder Company            Non-purchase money      $14,264

Holt Company of Texas            Non-purchase money       $9,460

Thomas Petroleum LTD             Non-purchase money       $9,398

Arguindegui Oil Co. II, Ltd.     Non-purchase money       $8,635

CINTAS Corporation               Judgment                 $8,500

AFCO                             Insurance                $7,849


ALOHA AIR: Governmental Claims Bar Date Set for Oct. 28
-------------------------------------------------------
The Hon. Robert J. Faris of the U.S. Bankruptcy Court for the
District of Hawaii established Oct. 28, 2005, as the interim
deadline for all governmental units owed money by Aloha Airgroup,
Inc., and its subsidiary Aloha Airlines, Inc., on account of
claims arising prior to Dec. 30, 2004, to file their proofs of
claim.

Governmental units must file written proofs of claim on or before
the Oct. 28 bar date and those forms must be delivered to:

      The Clerk of the U.S. Bankruptcy Court
      District of Hawaii  
      1132 Bishop Street, Suite 250-L
      Honolulu, Hawaii 96813

Judge Faris will convene a hearing at 9:30 a.m. on Oct. 18, 2005,
to discuss further extensions to the governmental claims bar date.

Headquartered in Honolulu, Hawaii, Aloha Airgroup, Inc. --
http://www.alohaairlines.com/-- provides air carrier service  
connecting the five major airports in the State of Hawaii.  Aloha
Airgroup and its subsidiary Aloha Airlines, Inc., filed for
chapter 11 protection on Dec. 30, 2004 (Bankr. D. Hawaii Case No.
04-03063).  Alika L. Piper, Esq., Don Jeffrey Gelber, Esq., and
Simon Klevansky, Esq., at Gelber Gelber Ingersoll & Klevansky
represent the Debtors in their restructuring efforts.  When the
Debtor filed for protection from its creditors it listed more than
$50 million in estimated assets and debts.


AMHERST TECHNOLOGIES: Court Fixes Nov. 17 Claims Bar Date
---------------------------------------------------------
The U.S. Bankruptcy Court for the District of New Hampshire set
Nov. 17, 2005, as the deadline for all creditors owed money by
Amherst Technologies, LLC, and its debtor affiliates on account of
claims arising prior to July 20, 2005, to file formal written
proofs of claim.

Creditors must deliver their claim forms to the:

     Office of the Clerk
     United States Bankruptcy Court
     District of New Hampshire
     1000 Elm Street, Suite 1001
     Manchester, New Hampshire 03101-1708.

Headquartered in Merrimack, New Hampshire, Amherst Technologies,
LLC -- http://www.amherst1.com/-- offers enterprise class   
solutions including wired and wireless networking, server and
storage optimization implementations, document management
solutions, IT lifecycle solutions, Microsoft solutions, physical
security and surveillance and complex configured systems.  The
Company and its debtor-affiliates filed for chapter 11 protection
on July 20, 2005 (Bankr. D. N.H. Case No. 05-12831).  Daniel W.
Sklar, Esq., at Nixon Peabody LLP represents the Debtors in their
restructuring efforts.  When the Debtors filed for protection from
its creditors, they estimated assets and debts of $10 million to
$50 million.


ANTHRACITE CDO: Fitch Lifts Rating on $10MM Notes 1 Notch to BB+  
----------------------------------------------------------------
Fitch Ratings upgrades nine classes of notes and affirms one class
of notes issued by Anthracite II CDO, Ltd.  These rating actions
are effective immediately:

    -- $158,027,000 class A notes affirmed at 'AAA';
    -- $12,979,000 class B notes upgraded to 'AA+' from 'AA';
    -- $31,000,000 class B-FL notes upgraded to 'AA+' from 'AA';
    -- $42,978,000 class C notes upgraded to 'A' from 'A-';
    -- $5,000,000 class C-FL notes upgraded to 'A' from 'A-';
    -- $19,991,000 class D notes upgraded to 'BBB+' from 'BBB';
    -- $10,000,000 class E notes upgraded to 'BBB' from 'BBB-';
    -- $12,850,000 class F notes upgraded to 'BBB' from 'BBB-';
    -- $10,000,000 class G notes upgraded to 'BB+' from 'BB'.

Anthracite II is a collateralized debt obligation, which closed
Dec. 10, 2002.  Anthracite II is supported by a static pool of
commercial mortgage-backed securities (CMBS: 80%) and senior
unsecured real estate investment trust (REIT: 20%) securities.
BlackRock Financial Management (rated 'CAM1' for CDO Asset
Management by Fitch) selected the initial collateral.

These rating actions reflect the improved credit quality of the
assets, specifically the June 2005 defeasance of the Landmark B-
note loan.  The Landmark B-note is securitized as a several stand
alone notes within CSFB 2001-CP4.  Approximately 2.8% of
Anthracite II's portfolio consists of defeased Landmark B-note
securitizations, which are listed on the trustee report as CSFB
2001-CP4 LM A, B, C and CSFB 2001-CP4 LM2 A, B, C.  Including the
defeasance, approximately 13.4% of the collateral experienced
positive credit migration since close.  The Fitch weighted average
rating factor has improved since the close of the transaction but
remains within the 'BB+/BB' rating category.  The information
regarding the defeasance, together with the additional positive
credit migration, warrants the upgrade of the above classes.

Fitch will continue to monitor and review this transaction for
future rating adjustments.  Additional deal information and
historical data are available on the Fitch Ratings web site at
http://www.fitchratings.com/


ARCAP 2004-1: Fitch Affirms Low-B Rating on Two Cert. Classes
-------------------------------------------------------------
Fitch Ratings affirms all classes of notes issued by ARCap 2004-1
Resecuritization Trust.  These affirmations are the result of
Fitch's review process and are effective immediately:

     -- $57,100,000 class A notes at 'AAA';
     -- $30,600,000 class B notes at 'AA';
     -- $26,500,000 class C notes at 'A';
     -- $8,500,000 class D notes at 'A-';
     -- $30,700,000 class E notes at 'BBB+';
     -- $13,600,000 class F notes at 'BBB';
     -- $36,000,000 class G notes at 'BBB';
     -- $13,000,000 class H notes at 'BBB-';
     -- $31,500,000 class J notes at 'BB';
     -- $20,500,000 class K notes at 'B'.

ARCap 2004-1 is a collateralized debt obligation, which closed on
April 19, 2004, and is supported by a static portfolio of
commercial mortgage-backed securities.  ARCap REIT, Inc. selected
the collateral and is currently rated 'CAM2' by Fitch.

These rating affirmations are a result of stable collateral
performance.  Since the close of the transaction, the weighted
average credit quality of the collateral has remained within the
'BB-/B+' rating category.  According to the Aug. 18, 2005 trustee
report, the overcollateralization test for classes A through H has
remained unchanged since the May 18, 2004 trustee report at
157.8%, above its minimum threshold of 120%.  The interest
coverage test for classes A through H has increased marginally to
153.4% from 149.7%, maintaining a cushion above its minimum
threshold of 115%.

The rating of the class A and B notes addresses the likelihood
that investors will receive full and timely payments of interest
and ultimate repayment of principal by the stated maturity date.  
The ratings of the class C, D, E, F, G, H, J, and K notes address
the likelihood that investors will receive ultimate payment of
scheduled and compensated interest and ultimate repayment of
principal by the stated maturity date.

Fitch will continue to monitor and review this transaction for
future rating adjustments. Additional deal information and
historical data are available on the Fitch Ratings web site at
http://www.fitchratings.com/


ARCAP 2004-RR3: Fitch Holds Low-B Rating on Six Cert. Classes
-------------------------------------------------------------
Fitch Ratings affirms ARCap 2004-RR3 Resecuritization, Inc.'s,
commercial mortgage-backed securities pass-through certificates,
series 2004-RR3:

     -- $50 million class A-1 at 'AAA';
     -- $272.5 million class A-2 at 'AAA';
     -- Interest-only class X at 'AAA';
     -- $40.9 million class B at 'AA';
     -- $31.4 million class C at 'A';
     -- $6.8 million class D at 'A-';
     -- $16.4 million class E at 'BBB+';
     -- $13.6 million class F at 'BBB';
     -- $13 million class G at 'BBB-';
     -- $18.4 million class H at 'BB+';
     -- $8.9 million class J at 'BB';
     -- $8.2 million class K at 'BB-';
     -- $8.9 million class L at 'B+';
     -- $13 million class M at 'B';
     -- $5.5 million class N at 'B-'.

Fitch does not rate the $38.2 million class O certificates.

The rating affirmations reflect the stable performance of the
underlying collateral.  The transaction has not paid down since
issuance and has suffered no losses to date.

The certificates are collateralized by all or a portion of 57
classes of fixed-rate CMBS in 19 separate underlying CMBS
transactions.  The weighted average rating factor of the
underlying classes is 17.14 ('BB'/'BB-'), stable from issuance.  
The classes' ratings are based on Fitch's actual rating, or on
Fitch's internal credit assessment for those classes not rated by
Fitch.

Delinquencies in the underlying transactions are as follows: 30
days: 0.05%; 60 days: 0.11%; 90+ days: 0.32%; in foreclosure:
0.04%; and real estate owned 0.23%.


ARLINGTON HOSPITALITY: Nasdaq to Halt Securities Trading Tomorrow
-----------------------------------------------------------------
Arlington Hospitality, Inc. (NASDAQ: HOSTE) received notice from
the Nasdaq Listing Qualification Department stating that the
company's securities will be delisted from The Nasdaq SmallCap
Market effective with the open of business tomorrow, Sept. 1,
2005, as a result of the company's failure to file its quarterly
report on Form 10-Q for the quarter ended June 30, 2005.

As a result of the company's failure to satisfy the requirements
of Marketplace Rule 4310(c)(14), a fifth character "E" was added
to the company's trading symbol at the opening of business on
August 25, 2005, and the company's securities will be delisted
from The Nasdaq Stock Market at the opening of business on
September 1, 2005, unless the company appeals the decision of the
Nasdaq Staff.  The company has until August 31, 2005 to appeal the
decision; however, the company does not expect to submit an appeal
by this date.

The company is continuing to evaluate its strategic alternatives,
including the filing of a voluntary petition for reorganization
under Chapter 11 of the U.S. Bankruptcy Code.  The company's
shares may become eligible to trade on the OTC Bulletin Board, if
a market maker makes an application to register and quote the
company's securities in accordance with SEC Rule15c2-11, such
application is cleared, and provided further, that the company
does not become the subject of a bankruptcy proceeding.  There can
be no assurance that trading on the OTC Bulletin Board will occur.

Arlington Hospitality, Inc. is a hotel development and management
company that builds, operates and sells mid-market hotels.
Arlington is the nation's largest owner and franchisee of
AmeriHost Inn hotels, a mid-market, limited-service hotel brand
owned and presently franchised in 20 states and Canada by Cendant
Corporation (NYSE: CD), with over 100 properties.  Currently,
Arlington Hospitality, Inc. owns or manages 35 AmeriHost Inn
hotels in nine states, for a total of 2,400 rooms, with additional
AmeriHost Inn & Suites hotels under development.


ARMSTRONG WORLD: Wants Plan Filing Period Stretched to March 6
--------------------------------------------------------------
Armstrong World Industries, Inc., and its two debtor-affiliates
continue to pursue an appeal from the District Court order denying
confirmation of AWI's plan of reorganization before the U.S. Court
of Appeals for the Third Circuit, Rebecca L. Booth, Esq., at
Richards, Layton & Finger, P.A., in Wilmington, Delaware, informs
the Bankruptcy Court.

Although briefing regarding the Appeal is now complete, Ms. Booth
relates that the Third Circuit has not yet scheduled oral
argument.  Even if AWI is successful on appeal, she says, the
District Court may decide to rule on the other confirmation
objections raised by the Creditors Committee, which the District
Court did not decide originally.

With the status of the Plan uncertain, Ms. Booth contends that
termination of the Debtors' exclusive periods to file and solicit
acceptances of a plan would almost certainly lead to full blown
litigation and limit the opportunity to attempt to re-forge a
consensus among AWI's constituents.

Ms. Booth notes that AWI has continued to explore alternatives for
its emergence from Chapter 11 and has engaged in discussions with
representatives of its key constituencies toward that end.

"Termination of the Exclusive Periods at this stage of the Chapter
11 cases, or alternatively, the grant of only a short extension of
the Exclusive Periods, would directly contravene the spirit and
purpose of chapter 11 of the Bankruptcy Code," Ms. Booth says.

Given the sheer size and complexity of the Debtors' cases and the
issues and constituencies involved, Ms. Booth says, it is
unrealistic to expect that the Debtors could have made greater
progress since their cases were commenced.  Moreover, Ms. Booth
continues, no other party-in-interest is in a position to file a
plan of reorganization that could be confirmed without costly,
protracted litigation.

Ms. Booth points out that termination of the Exclusive Periods
would expose the Debtors' estates to the uncertainty of multiple
plans of reorganization being proposed with the attendant
confusion, dislocation and negative impact on their operations,
asset values, and employee morale.

Ms. Booth asserts that the Debtors' efforts at preserving and
stabilizing their businesses have been extremely successful and
have served to maximize value for the benefit of the entire
reorganization effort.  "The termination of merely a short
extension of the Exclusive Periods would impair and undermine, for
no rational reason, the stabilization in the Debtors' cases."

Accordingly, the Debtors ask the U.S. Bankruptcy Court for the
District of Delaware to extend their exclusive periods to:

    -- file a plan of reorganization to March 6, 2006, and
    -- solicit acceptances of that plan until May 8, 2006.

Ms. Booth maintains that an additional extension of the Exclusive
Periods will neither prejudice nor put pressure in any party-in-
interest.

The Court will convene a hearing on September 26, 2005, to
consider the Debtors' request.  By application of Del.Bankr.LR
9006-2, the Debtors' Exclusive Periods is automatically extended
until the Court rules on the request.

Headquartered in Lancaster, Pennsylvania, Armstrong World
Industries, Inc. -- http://www.armstrong.com/-- the major
operating subsidiary of Armstrong Holdings, Inc., designs,
manufactures and sells interior finishings, most notably floor
coverings and ceiling systems, around the world.  The Company and
its debtor-affiliates filed for chapter 11 protection on
December 6, 2000 (Bankr. Del. Case No. 00-04469).  Stephen
Karotkin, Esq., at Weil, Gotshal & Manges LLP, and Russell C.
Silberglied, Esq., at Richards, Layton & Finger, P.A., represent
the Debtors in their restructuring efforts.  When the Debtors
filed for protection from their creditors, they listed
$4,032,200,000 in total assets and $3,296,900,000 in liabilities.
As of March 31, 2005, the Debtors' balance sheet reflected a
$1.42 billion stockholders' deficit. (Armstrong Bankruptcy
News, Issue No. 81; Bankruptcy Creditors' Service, Inc.,
215/945-7000)


ASARCO LLC: Wants Bracewell as Special Litigation Counsel
---------------------------------------------------------
Prior to ASARCO LLC's bankruptcy filing, Bracewell & Giuliani LLP
represented the company as environmental counsel, advising ASARCO
on many issues, including environmental litigation.  Eric Groten,
Esq., now a Bracewell partner, has represented ASARCO for about
20 years, originally when employed by a Phoenix, Arizona law
firm, then by another Texas firm, and since 1998 at Bracewell.  
Over the years, Mr. Groten has been the primary air quality
lawyer for various ASARCO assets.

In 1990 to 1992, Mr. Groten represented ASARCO in a contested
permit proceeding at the Texas Air Control Board to authorize the
air emissions from its El Paso smelter.  Since then, he has
advised ASARCO with changes to that permit.  Although the smelter
was idled in 1999, ASARCO applied to renew its air permit in
2002.  The renewal process also has been highly contested, and
Bracewell has represented ASARCO in all phases of that permit
renewal proceeding.

Two years later, the Texas Commission on Environmental Quality
referred the matter to the State Office of Administrative
Hearings for a contested case hearing, similar to a bench trial
before an administrative law judge.  A two-week evidentiary
hearing concluded in July, and the record is currently in the
process of briefing.

As a result of its prior work on a variety of matters, Bracewell
is uniquely familiar with the Debtor, its business, and its
environmental liabilities.

Accordingly, ASARCO asks the U.S. Bankruptcy Court for the
Southern District of Texas for permission to employ Bracewell as
special litigation counsel pursuant to Section 327(e) of the
Bankruptcy Code, nunc pro tunc to Aug. 9, 2005.  

ASARCO proposes to compensate Bracewell for its legal services on
an hourly basis in accordance with its ordinary and customary
hourly rates:

               Professionals           Hourly Rate
               -------------           -----------
               Attorneys               $400 - $200
               paraprofessionals           $75

ASARCO will also reimburse the firm for actual and necessary out-
of-pocket expenses.  

Mr. Groten discloses that, within the 90-day period preceding the
commencement of ASARCO's bankruptcy case, Bracewell received
payment from ASARCO of $293,997 for professional services
rendered and expenses incurred before the Petition Date.  In
addition, although Bracewell has a general unsecured claim
against ASARCO for about $163,598 for prepetition services
rendered for which the firm did not receive payment, it does not
have or represent any interest adverse to the Debtor or its
estate on the matters for which it is being retained as special
counsel.

Headquartered in Tucson, Arizona, ASARCO LLC --
http://www.asarco.com/-- is an integrated copper mining, smelting    
and refining company.  Grupo Mexico S.A. de C.V. is ASARCO's
ultimate parent.  The Company filed for chapter 11 protection on
Aug. 9, 2005 (Bankr. S.D. Tex. Case No. 05-21207).  James R.
Prince, Esq., Jack L. Kinzie, Esq., and Eric A. Soderlund, Esq.,
at Baker Botts L.L.P., and Nathaniel Peter Holzer, Esq., Shelby A.
Jordan, Esq., and Harlin C. Womble, Esq., at Jordan, Hyden,
Womble & Culbreth, P.C., represent the Debtor in its restructuring
efforts.  When the Debtor filed for protection from its creditors,
it listed $600 million in total assets and $1 billion in total
debts.

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.  Details about their asbestos-
driven chapter 11 filings have appeared in the Troubled Company
Reporter since Apr. 18, 2005.  ASARCO has asked that the five
subsidiary cases be jointly administered with its chapter 11 case.
(ASARCO Bankruptcy News, Issue No. 3; Bankruptcy Creditors'
Service, Inc., 215/945-7000)


ASARCO LLC: Taps Quarles as Special Counsel to Tackle Labor Issues
------------------------------------------------------------------
ASARCO LLC seeks authority from the U.S. Bankruptcy Court for the
Southern District of Texas to employ Quarles & Brady Streich Lang
as special litigation counsel for labor and employment issues,
nunc pro tunc to Aug. 9, 2005.

Q&B was employed by ASARCO in early 2004 to represent the
company in collective bargaining and in related labor matters.  
Throughout 2004 and 2005, Q&B has provided advice and counsel to
ASARCO on labor relations matters, including representing ASARCO
at the Copper Group and Ray bargaining tables for contracts to
replace those that expired June 30, 2004, and June 30, 2005.  In
addition, Q&B has defended ASARCO in numerous cases before the
National Labor Relations Board filed in 2005 by the labor unions
representing ASARCO's Arizona and Texas employees.  

Because of the types of claims and the entities involved in these
cases, some of these proceedings may fall outside the scope of
the Bankruptcy Code's automatic stay provisions.  Accordingly,
ASARCO has asked Q&B to continue its representation postpetition.

Q&B is a law firm with six offices in four states, employing
approximately 400 to 450 lawyers, including approximately 125 in
Arizona.  About 45 Q&B attorneys work in the L&E Group, which
represents management in labor and employment matters.  As a
result of its prior work on labor and employment matters, Q&B is
uniquely familiar with the Debtor, its business, and the labor-
related legal issues facing ASARCO.

The Debtor proposes to compensate Q&B for its legal services on
an hourly basis in accordance with its ordinary and customary
hourly rates.  The Debtor will also reimburse the firm for actual
and necessary out-of-pocket expenses.

Q&B's hourly rates for L&E lawyers at its Phoenix office range
from $185 to $395.  Q&B's current customary hourly rates for
paraprofessionals range from $130 to $160.

The professionals at Q&B who will primarily represent the Debtor
and their hourly rates are:

          Professional      Position        Hourly Rate
          ------------      --------        -----------
          Dawn Valdivia     Associate           $200
          Jon E. Pettibone  Partner             $365
          Lisa Duran        Partner             $290

The fee arrangement with ASARCO provides for a $45 discount in
Mr. Pettibone's fee.

The fee arrangement also provides for a $30,000 advance to be
replenished monthly.

Mr. Pettibone discloses that within the 90-day period before the
Petition Date, Q&B received payment from ASARCO of $110,852 for
professional services rendered and expenses incurred by Q&B prior
to the Petition Date.  Although Q&B has a general unsecured claim
against ASARCO for $541 for prepetition services rendered for
which Q&B did not receive payment, the firm holds no interest
adverse to the Debtor or its estate on the matters for which the
firm is being retained as special counsel.

Headquartered in Tucson, Arizona, ASARCO LLC --
http://www.asarco.com/-- is an integrated copper mining, smelting    
and refining company.  Grupo Mexico S.A. de C.V. is ASARCO's
ultimate parent.  The Company filed for chapter 11 protection on
Aug. 9, 2005 (Bankr. S.D. Tex. Case No. 05-21207).  James R.
Prince, Esq., Jack L. Kinzie, Esq., and Eric A. Soderlund, Esq.,
at Baker Botts L.L.P., and Nathaniel Peter Holzer, Esq., Shelby A.
Jordan, Esq., and Harlin C. Womble, Esq., at Jordan, Hyden,
Womble & Culbreth, P.C., represent the Debtor in its restructuring
efforts.  When the Debtor filed for protection from its creditors,
it listed $600 million in total assets and $1 billion in total
debts.

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.  Details about their asbestos-
driven chapter 11 filings have appeared in the Troubled Company
Reporter since Apr. 18, 2005.  ASARCO has asked that the five
subsidiary cases be jointly administered with its chapter 11 case.
(ASARCO Bankruptcy News, Issue No. 3; Bankruptcy Creditors'
Service, Inc., 215/945-7000)


ASARCO LLC: Asks Court to Bless 2005 Environmental Clean-Up Budget
------------------------------------------------------------------
In July 2002, ASARCO LLC informed the United States of America
that Southern Peru Holdings Corporation and itself intended to
sell their stock holdings and majority interest in the Southern
Peru Copper Corp. to Americas Mining Corporation, ASARCO's parent
corporation.

ASARCO has environmental liabilities to the U.S. Government
pursuant to certain consent decrees, administrative orders, or
environmental statutes.

On Aug. 9, 2002, the U.S. Government filed a complaint against
ASARCO and SPHC in the United States District Court for the
District of Arizona, wherein the Government alleged that the
proposed terms of the SPCC sale violated provisions of the
Federal Debt Collection Procedures Act of 1990 and the Federal
Priorities Act.  The Government sought preliminary and injunctive
relief enjoining the sale and transfer.

The parties to the lawsuit reached a settlement of their dispute.
On February 2, 2003, the Arizona Court approved a consent decree
that had been entered into among ASARCO and SPHC, on the one
hand, and the United States, on the other hand.

Pursuant to the settlement, ASARCO agreed to set up a
$100,000,000 environmental trust for pollution cleanup, in return
for permission to sell SPCC.  The consent decree establishes an
annual budgeting process pursuant to which ASARCO and the U.S.
Government discuss the allocation of funds from the trust at
various sites.

Once a budget has been established, both ASARCO and the U.S.
Government must agree to any amendment of the budget.

ASARCO previously operated a copper smelter in Ruston,
Washington.  The existing 2005 annual budget contemplates
expenditures of both trust funds and ASARCO general corporate
funds for soil cleanup and sampling at the Ruston Site.  On the
Petition Date, ASARCO was in the process of performing
remediation and testing work at the Ruston Site, but this work
came to a halt upon its bankruptcy filing.  

Because the liabilities relating to the Ruston Site are
dischargeable prepetition obligations, ASARCO cannot continue
spending its general corporate funds on the remediation and
testing work there.  However, ASARCO does not believe that the
funds in the environmental trust are property of its estate.
Therefore, those funds are available to continue the work at the
Ruston Site, provided the parties consent to amendment of the
2005 budget.

Jack L. Kinzie, Esq., at Baker Botts LLP, in Dallas, Texas,
reminds the Court that the right to consent to an amendment of
the budget is a property right that could be considered property
of its estate.  Mr. Kinzie cites that Section 363(b)(1) of the
Bankruptcy Code permits a debtor, after notice and a hearing, to
use, sell or lease property of the estate other than in the
ordinary course of its business.

By this motion, ASARCO seeks authority from the U.S. Bankruptcy
Court for the Southern District of Texas to consent to the
amendment to the 2005 annual budget pursuant to a consent
decree with the United States of America.  The Debtor believes
that the amendment of the 2005 annual budget is necessary for the
operation of ASARCO's business and is in the best interest of the
estate.

Mr. Kinzie asserts that unless the Debtor is authorized to
consent to the amendment of the 2005 annual budget, the U.S.
Government believes that the public health and safety could be
jeopardized.  The amendment that the U.S. Government has agreed
to would allocate $150,000 of the trust money that is as yet
unallocated to pay for the continued remediation and testing.  
In other words, any potential health and safety issues could be
minimized with very little effect on ASARCO's estate.

Headquartered in Tucson, Arizona, ASARCO LLC --
http://www.asarco.com/-- is an integrated copper mining, smelting    
and refining company.  Grupo Mexico S.A. de C.V. is ASARCO's
ultimate parent.  The Company filed for chapter 11 protection on
Aug. 9, 2005 (Bankr. S.D. Tex. Case No. 05-21207).  James R.
Prince, Esq., Jack L. Kinzie, Esq., and Eric A. Soderlund, Esq.,
at Baker Botts L.L.P., and Nathaniel Peter Holzer, Esq., Shelby A.
Jordan, Esq., and Harlin C. Womble, Esq., at Jordan, Hyden,
Womble & Culbreth, P.C., represent the Debtor in its restructuring
efforts.  When the Debtor filed for protection from its creditors,
it listed $600 million in total assets and $1 billion in total
debts.

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.  Details about their asbestos-
driven chapter 11 filings have appeared in the Troubled Company
Reporter since Apr. 18, 2005.  ASARCO has asked that the five
subsidiary cases be jointly administered with its chapter 11 case.
(ASARCO Bankruptcy News, Issue No. 3; Bankruptcy Creditors'
Service, Inc., 215/945-7000)


ATA AIRLINES: Court Extends Plan-Filing Period Until Sept. 30
-------------------------------------------------------------
The U.S. Bankruptcy Court for the Southern District of Indiana
extended the period within which ATA Airlines, Inc., and its
debtor-affiliates have the exclusive right to file a plan of
reorganization until Sept. 30, 2005.  The Court also extended the
Debtors' plan solicitation period to Nov. 30, 2005.  

Jeffrey C. Nelson, Esq., at Baker & Daniels, in Indianapolis,  
Indiana, explains that, in addition to managing their day-to-day
operations, the Debtors and their advisors have been evaluating
all facets of their businesses and operations to determine the
best method for returning value to their creditors, including,
analyzing leases of aircraft used in their operations and  
executory contracts.

Headquartered in Indianapolis, Indiana, ATA Airlines, owned by ATA
Holdings Corp. -- http://www.ata.com/-- is the nation's 10th  
largest passenger carrier (based on revenue passenger miles) and
one of the nation's largest low-fare carriers.  ATA has one of the
youngest, most fuel-efficient fleets among the major carriers,
featuring the new Boeing 737-800 and 757-300 aircraft.  The
airline operates significant scheduled service from Chicago-
Midway, Hawaii, Indianapolis, New York and San Francisco to over
40 business and vacation destinations.  Stock of parent company,
ATA Holdings Corp., is traded on the Nasdaq Stock Exchange.  The
Company and its debtor-affiliates filed for chapter 11 protection
on Oct. 26, 2004 (Bankr. S.D. Ind. Case Nos. 04-19866, 04-19868
through 04-19874).  Terry E. Hall, Esq., at Baker & Daniels,
represents the Debtors in their restructuring efforts.  When the
Debtors filed for protection from their creditors, they listed
$745,159,000 in total assets and $940,521,000 in total debts.  
(ATA Airlines Bankruptcy News, Issue No. 32; Bankruptcy Creditors'
Service, Inc., 215/945-7000)


ATKINS NUTRITIONALS: U.S. Trustee Picks 5-Member Creditors Panel
----------------------------------------------------------------          
The United States Trustee for Region 2 appointed five creditors
to serve on the Official Committee of Unsecured Creditors in
Atkins Nutritionals, Inc., and its debtor-affiliates' chapter 11
cases:

      1. CVS Pharmacy, Inc.
         Attention: Michael B. Nulman, Esq.,
         One CVS Drive
         Woonsocket, Rhode Island 02895
         Tel: 401-770-2533

      2. Seligman Data Corp.
         Attn: Nicholas V. Martino
         100 Park Avenue
         New York, New York 10017
         Tel: 212-850-1287

      3. Contemporary Marketing, Inc.
         Attn: Sharon Nikolich
         1569 Barclay
         Buffalo Grove, Illinois 60089
         Tel: 847-541-0330

      4. Widmeyer Communications
         1925 Connecticut Avenue
         NW, Fifth Floor
         Washington, D.C. 20009
         Tel: 202-667-0901

      5. New England 800 Company d/b/a Tactionn
         Attention: Ralph White
         251 Jefferson Street
         Waldoboro, Maine 04572
         Tel: 207-832-0800

Official creditors' committees have the right to employ legal and
accounting professionals and financial advisors, at the Debtors'
expense.  They may investigate the Debtors' business and financial
affairs.  Importantly, official committees serve as fiduciaries to
the general population of creditors they represent.  Those
committees will also attempt to negotiate the terms of a
consensual chapter 11 plan -- almost always subject to the terms
of strict confidentiality agreements with the Debtors and other
core parties-in-interest.  If negotiations break down, the
Committee may ask the Bankruptcy Court to replace management with
an independent trustee.  If the Committee concludes reorganization
of the Debtors is impossible, the Committee will urge the
Bankruptcy Court to convert the Chapter 11 cases to a liquidation
proceeding.

Headquartered in New York, New York, Atkins Nutritionals, Inc.
-- http://atkins.com/-- sell nutritional supplements based on its  
founder, Dr. Robert C. Atkins' nutritional philosophy of
controlled-carbohydrate lifestyle.  The Debtors also sell more
than 100 food products and nutritional supplements, as well as
informational products such as diet books and cookbooks. Atkins'
products are sold in more than 30,000 stores in North America
under numerous trademarks.  The Company along with Atkins
Nutritionals Holdings, Inc., Atkins Nutritionals Holdings II,
Inc., and Atkins Nutritionals (Canada) Limited, filed for chapter
11 protection on July 31, 2005 (Bankr. S.D.N.Y. Case No.
05-15913).  Marcia L. Goldstein, Esq., at Weil Gotshal &
Manges LLP, represents the Debtors in the United States, while
lawyers at Osler, Hoskin & Harcourt, LLP, represents the Debtors
in Canada.  As of May 28, 2005, they listed $265.6 million in
total assets and $323.2 million in total debts.


ATKINS NUTRITIONALS: Gets Final Court Nod to Use Cash Collateral
----------------------------------------------------------------          
The U.S. Bankruptcy Court for the Southern District of New York
granted Atkins Nutritionals, Inc., and its debtor-affiliates,
final approval:

   a) to use Cash Collateral securing repayment of pre-petition
      obligations to UBS AG Stamford Branch as the Pre-Petition
      Agent for itself and the Pre-Petition Lenders; and

   b) to grant UBS AG and the Pre-Petition Lenders security
      interests and liens on all of the Debtors' pre-petition and
      post-petition assets and property.

               Pre-Petition Debt, Cash Collateral Use
                      & Adequate Protection

Under various pre-petition Credit and Loan Agreements, the Debtors
owe:

      Pre-Petition Lender                  Amount Owed
      -------------------                  -----------
      UBS AG & Pre-Petition Lenders        $197,187,250
      (under the First Lien
       Term Loans)

      UBS AG & Pre-Petition Lenders         $78,892,500
      (under the Second Lien
       Term Loans)

      UBS AG & Pre-Petition Lenders          $7,999,464
      (under all Revolving Loans)          ------------
                                           $284,079,214

The Debtors will use UBS AG and the Pre-Petition Lenders' Cash
Collateral as additional source of working capital and financing
to operate their businesses in the ordinary course of business and
maintain their property in accordance with state and federal laws.

The Court authorizes the Debtors to use the Cash Collateral of UBS
AG and the Pre-Petition Lenders through the earlier to occur of
April 30, 2006, and the Termination Date as defined in the DIP
Credit Agreement between the Debtors and UBS AG and the DIP
Lenders.

The Debtors are only authorized to use the Cash Collateral in
compliance with the projections of a 23-week Cash Forecast &
Analysis Budget, covering the period from July 29, 2005, to
Dec. 30, 2005.  A full-text copy of the Budget is available for
free at:

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

As adequate protection for any diminution in value of the Pre-
Petition Collateral, UBS AG and the Pre-Petition Lenders are
granted continuing, valid, binding, enforceable and perfected
post-petition security interests and liens on all of the Debtors'
Cash Collateral.

Headquartered in New York, New York, Atkins Nutritionals, Inc.
-- http://atkins.com/-- sell nutritional supplements based on its  
founder, Dr. Robert C. Atkins' nutritional philosophy of
controlled-carbohydrate lifestyle.  The Debtors also sell more
than 100 food products and nutritional supplements, as well as
informational products such as diet books and cookbooks. Atkins'
products are sold in more than 30,000 stores in North America
under numerous trademarks.  The Company along with Atkins
Nutritionals Holdings, Inc., Atkins Nutritionals Holdings II,
Inc., and Atkins Nutritionals (Canada) Limited, filed for chapter
11 protection on July 31, 2005 (Bankr. S.D.N.Y. Case No.
05-15913).  Marcia L. Goldstein, Esq., at Weil Gotshal &
Manges LLP, represents the Debtors in the United States, while
lawyers at Osler, Hoskin & Harcourt, LLP, represents the Debtors
in Canada.  As of May 28, 2005, they listed $265.6 million in
total assets and $323.2 million in total debts.


AVCORP INDUSTRIES: Issuing 3.2 Million Stock via Private Placement
------------------------------------------------------------------
Avcorp Industries Inc. (AVP on the Toronto Stock Exchange) has
negotiated a non-brokered Private Placement of up to 3,200,000
units at a price of $1.00 per unit, to raise gross proceeds of up
to $3,200,000.

                     Private Placement

Each unit of the Private Placement will consist of one common
share and one non-transferable share purchase warrant.  Two share
purchase warrants together will entitle the holder thereof to
purchase one common share of the Company at $1.20 per share for a
12-month period, from the closing date.  The proceeds of the
financing will be used for general working capital purposes.
Certain Insiders, Directors and Officers may subscribe for a
portion of this placement.  The financing is subject to regulatory
approval.

                    Debenture Extension

Pursuant to agreements with all of the holders of the Series A
Secured Debentures, the Debenture term has been extended to
March 31, 2008.  In consideration of the extension debenture
holders granted priority to the increased banking facility as
previously announced on Aug. 18, 2005.  The conversion price of
the Debentures will be reduced to $1.50 for calendar year 2006 and
$2.00 for calendar year 2007 subject to regulatory approval and
the interest rate will increase from 8.75% to 9.25% effective
Oct. 1, 2005, for the balance of the term.

Avcorp has successfully absorbed 153 new employees over the past
six months increasing its number of employees from a low of 491,
to a current level of approximately 580.  While training and
learning curve costs have impacted profitability, management is
confident that ongoing improvements will allow the Company to meet
or exceed its objectives.

Avcorp Industries Inc. -- http://www.avcorp.com/-- designs and  
builds major airframe structures for some of the world's most
respected aircraft companies, including Bombardier, Boeing and
Cessna.  With over 40 years of experience, more than 580 skilled
employees and a 300,000 square foot facility near Vancouver,
Canada, the company's depth and breadth of capabilities are unique
in the aerospace industry for a company of its size.  Avcorp is a
Canadian public company traded on the Toronto Stock Exchange.

At June 30, 2005, Avcorp Industries' equity deficit widened to
CDN$42,887,000, from a CDN$37,149,000 deficit at Dec. 31, 2004.


BLEECKER STRUCTURED: Poor Credit Quality Cues Fitch's Downgrade
---------------------------------------------------------------
Fitch Ratings downgrades three classes of notes issued by Bleecker
Structured Asset Fund, Ltd.  These rating actions are effective
immediately:

    -- $14,209,800 class A-1 notes downgrade to 'B+' from 'BBB';
    -- $99,468,603 class A-2 notes downgrade to 'B+' from 'BBB';
    -- $41,528,801 class B notes downgrade to 'C' from 'CC';
    -- $43,341,693 class C notes remains at 'C'.

Bleecker is a collateralized debt obligation managed by Clinton
Group, Inc.  The deal was established in March 2000 to issue $457
million in notes and equity.  The collateral supporting the CDO is
comprised of a diversified portfolio of asset-backed securities,
residential mortgage-backed securities and commercial mortgage-
backed securities.

The rating actions are a result of continued deterioration in the
credit quality of Bleecker's collateral pool and the continued
negative impact of its interest rate hedge.  Since the last rating
action on Dec. 6, 2004, five new securities have defaulted, nine
assets have been downgraded, and assets rated below investment
grade have increased to 59.1% of the total portfolio.  Each of
these factors has contributed to the significant erosion of
Bleecker's overcollateralization ratios.  

As of the July 2005 trustee report, the class A OC ratio has
decreased to 94.7% from 109.0% as of the October 2004 trustee
report, and is currently below its trigger of 106.5%.  The class A
interest coverage ratio is currently 27.1%, and is also well below
its trigger of 106.5%.

The failure of the class A OC and IC tests has caused any excess
proceeds to be applied to the redemption of the class A notes
following the payment of class A interest, and causes the class B
notes to be shut off from their scheduled distributions.  The
class B notes last received their scheduled interest payment on
the March 2004 payment date.  Over that time period, there has
been an insufficient amount of interest proceeds available to pay
the full amount of class A interest, causing principal proceeds to
be applied to make up the difference.

As a result of this analysis, Fitch has determined that the
current ratings assigned to the class A-1, A-2, and B notes no
longer reflect the current risk to noteholders.

The rating of the class A-1, A-2 and B notes addresses the
likelihood that investors will receive full and timely payments of
interest, as per the governing documents, as well as the stated
balance of principal by the legal final maturity date.  The
ratings of the class C notes address the likelihood that investors
will receive ultimate and compensating interest payments, as per
the governing documents, as well as the stated balance of
principal by the legal final maturity date.

Fitch will continue to monitor and review this transaction for
future rating adjustments.  Additional deal information and
historical data 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, available on Fitch's web site
at http://www.fitchratings.com/


BUTLER INTERNATIONAL: Financial Filing Delay Cues Nasdaq Notice
---------------------------------------------------------------
Butler International, Inc. (NASDAQ: BUTLE) has not filed its Form
10-Q for the quarter ended June 30, 2005 by the required extended
filing date of August 22, 2005.  As a result, the Company received
a notice from NASDAQ that as a result of not timely filing the
Form 10-Q it is not in compliance with NASDAQ's listing
requirements, and its securities are therefore subject to possible
delisting from the NASDAQ Small Cap Market.  The Company must
request a hearing in accordance with Marketplace Rule 4800 Series
to continue trading under the symbol "BUTLE."  The Company
reaffirmed its intent to request from NASDAQ a further extension
for compliance under Rule 4310(c)(14).  The Company anticipates
filing its Form 10-Q before such hearing and at such time the
trading symbol will return to "BUTL."  As previously reported, the
Company has filed its Form 10-K for the year ended December 31,
2004 and Form 10-Q for the quarter ended March 31, 2005.

Pending determination of compliance with NASDAQ's filing
requirements and compliance with all other requirements for
continued listing on NASDAQ, the fifth character "E" will remain
appended to the Company's trading symbol.  Except as noted above,
the Company is currently compliant with all other applicable
NASDAQ rules.

Butler International -- http://www.butler.com/-- is a leading  
provider of TechOutsourcing services, helping customers worldwide
increase performance and savings. Butler's global services model
provides clients with onsite, offsite, or offshore services
delivery options customized appropriately to their unique
objectives. During its 59-year history of providing services,  
Butler has served many prestigious companies in industries
including aircraft, aerospace, defense, telecommunications,
financial services, heavy equipment, manufacturing, and more.

                       *     *     *

As reported in the Troubled Company Reporter on July 25, 2005,
Butler International, Inc. executed a waiver of technical default
by General Electric Capital Corporation under the Company's credit
facility.  

The technical default arose due to the failure of the Company to
timely file with the Securities and Exchange Commission its Form  
10-K for the year ended Dec. 31, 2004 and Form 10-Q for the
quarter ended March 31, 2005.  

The amendment provides that the year-end financial information
must be provided by July 26, 2005, and the first quarter financial
information must be provided by Aug. 17, 2005.  Butler expects to
provide the year-end financial information and file its Form 10-K
by July 26, 2005.  In addition, the amendment provides that the
indebtedness of Chief Executive Group must not exceed $10.6
million through Dec. 31, 2005, and $10.4 million thereafter.


CELESTICA INC: Redeeming $2.15 Million LYONs for $1.24 Million
--------------------------------------------------------------
Celestica Inc. (NYSE: CLS, TSX: CLS/SV) is redeeming all of its
Liquid Yield Option(TM) Notes due 2020 (Zero Coupon-Subordinated)
that are outstanding on September 23, 2005.  Under the terms of
the LYONs, Celestica has the right to redeem all or any part of
the outstanding LYONs at any time after August 1, 2005.  The
redemption price on September 23, 2005, will be US$575.84 per
US$1,000 principal amount at maturity.  All LYONs outstanding on
September 23, 2005, will be deemed to have been redeemed by
Celestica, whether or not they have been surrendered for
redemption, and all rights of the holders thereof will terminate,
with the exception of the holder's right to receive payment of the
redemption price upon the presentation and surrender of their
LYONs.  There is currently US$2,149,000 principal amount at
maturity of LYONs outstanding.  The aggregate cash purchase price
will be approximately US$1,237,480.

In order for a holder to receive its payment, the holder's LYONs
must be delivered to JPMorgan Chase Bank, N.A., the trustee for
the LYONs.  Questions and requests for assistance in connection
with the process for the surrender of LYONs may be directed to
JPMorgan Chase Bank, N.A., at (800) 275-2048.

Celestica, Inc. -- http://www.celestica.com/-- is a world leader     
in the delivery of innovative electronics manufacturing services.   
Celestica operates a highly sophisticated global manufacturing  
network with operations in Asia, Europe and the Americas,  
providing a broad range of integrated services and solutions to  
leading OEMs (original equipment manufacturers).  Celestica's  
expertise in quality, technology and supply chain management,  
enables the company to provide competitive advantage to its  
customers by improving time-to-market, scalability and  
manufacturing efficiency.    

                         *     *     *    

Celestica's 7-5/8% senior subordinated notes due 2013 and 7-7/8%  
senior subordinated notes due 2011 carry Moody's Investors  
Service's and Standard & Poor's single-B ratings.


CLEARLY CANADIAN: June 30 Stockholders' Equity Soars by $4 Million
------------------------------------------------------------------
Clearly Canadian Beverage Corporation (OTCBB:CCBEF) reported
unaudited consolidated financial results for its second fiscal
quarter ended June 30, 2005.

Sales were $2,561,000 for the second quarter 2005, compared with
$3,131,000 for the same period last year, a decrease of 18%.  This
decline in sales is attributable to the cumulative impact of
significantly reduced sales and marketing activities in recent
years.  This has been a direct result of working capital
constraints, which the Company has attempted to address, for the
most part, through the Company's recently completed financings
with BG Capital Group Ltd.

There was no significant change in the Company's cost of sales and
gross margin percentages, being 69% and 31% respectively, for
Q2-2005 versus 70% and 30% respectively for Q2-2004.

General and administrative expenses were $46,000 lower in Q2-2005
compared with Q2-2004, as a result of ongoing cost cutting
measures.

Selling expenses of $824,000 in Q2-2005 were approximately 32% of
sales, compared with $892,000 or approximately 28% of sales in
Q2-2004.  The increase in the percentage of sales expended on
selling expenses is a reflection of the increased cost associated
with attempting to maintain market share in a competitive business
throughout North America.  During the balance of 2005, and in
connection with the recent completion of its financing with BG
Capital Group Ltd., the Company has budgeted to increase its sales
and marketing activities in an effort to increase market share.

Loss for the period for Q2-2005 was $1,678,000 compared with a
Q2-2004 loss of $793,000.  The loss for the current quarter
includes:

   (a) a gain on settlement of debt ($220,000) in Q2-2005 (Q2-
       2004: $Nil) which was realized on obtaining reductions in
       certain accounts owing to creditors concurrent with the
       Company's recent refinancing; and

   (b) a stock compensation expense of $1,097,000 in Q2-2005 (Q2-
       2004: $Nil) which represents the non-cash value attributed
       to stock certain stock options granted during Q2-2005 in
       connection with the Company's recent financing with BG
       Capital.

"We completed the funding relative to our restructuring with BG
Capital late in the second quarter.  Our objectives in the second
half of 2005 include increasing the availability of brand Clearly
Canadian throughout North American markets through a strong
network of direct store delivery partners.  We are continuing to
complement our field sales force by adding skilled resources to
work closely with our distribution network and create new selling
opportunities across all classes of trade.  We are also actively
working to fill regional distribution gaps and to provide brand
Clearly Canadian greater marketing and promotional focus.  In the
third quarter, we expect to announce new distribution
relationships in several important U.S. markets.  In addition, the
Company is currently working closely with current and potential
new associates in the development of new business opportunities
both domestically and internationally," said Douglas L. Mason,
President and C.E.O. of Clearly Canadian Beverage Corporation.

                 Six Months Ended June 30, 2005

Sales were $4,289,000 for YTD-2005 compared with $6,065,000 for
YTD-2004, a decrease of 29%.  In addition to the cumulative impact
of significantly reduced sales and marketing activities in recent
years, the Company's financial condition in the first six months
of 2005 also did not allow for planned sales initiatives to
support the key Spring selling period.  With the completion
(May 28, 2005) of its financing with BG Capital, the Company now
has a satisfactory level of inventory to meet current customer
demands.  The Company is continuing to complement its field sales
force by adding skilled resources to work closely with its
distribution network and create new selling opportunities across
all classes of trade.

There was no significant change in the Company's cost of sales and
gross margin percentages in YTD-2005 compared with YTD-2004.

Selling expenses of $1,466,000 in YTD-2005 were approximately 34%
of sales, compared with $1,587,000 or approximately 26% of sales
in YTD-2004.  The increase in the percentage of sales expended on
selling expenses is a reflection of the increased cost associated
with attempting to maintain market share in a competitive business
throughout North America.  During the balance of 2005, and in
connection with the recent completion of its financing with BG
Capital, the Company has budgeted to increase its sales and
marketing activities in an effort to increase market share.

Loss for the period for the six months ended June 30, 2005, was
$2,559,000 compared with $1,290,000 for the six months ended
June 30, 2004.  The loss for the current period includes:

   (a) a gain on settlement of debt ($220,000) in YTD-2005
       (YTD-2004: $Nil) which was realized on obtaining reductions
       in certain accounts owing to creditors concurrent with the
       Company's recent financing; and

   (b) a stock compensation expense of $1,097,000 in YTD-2005
       (YTD-2004: $Nil) which represents the non-cash value
       attributed to certain stock options granted in connection
       with the Company's recent financing with BG Capital.

Based in Vancouver, B.C., Clearly Canadian Beverage Corporation --  
http://www.clearly.ca/-- markets premium alternative beverages    
and products, including Clearly Canadian(R) sparkling flavoured  
water and Clearly Canadian O+2(R) oxygen enhanced water beverage,  
which are distributed in the United States, Canada and various  
other countries.     

As of June 30, 2005, Clearly Canadian Beverage Corporation's
balance sheet showed a $672,000 equity compared to a $3,515,000
equity deficit at Dec. 31, 2004.


CONSECO INC: Shareholders Re-Elect Directors & OK PwC as Auditors
-----------------------------------------------------------------
Shareholders of Conseco, Inc. (NYSE: CNO) at the company's annual
meeting on Monday, Aug. 29, 2005:

   -- re-elected all eight directors to serve terms expiring at
      next year's annual meeting;

   -- approved both of the incentive plans submitted for approval;
      and

   -- ratified the appointment of PricewaterhouseCoopers LLP as
      the company's independent registered public accounting firm
      for 2005.

The newly re-elected directors are:

    * R. Glenn Hilliard, 62, Conseco's executive chairman, former
      chairman, chief executive officer and member of the
      executive committee for ING Americas, and a director since
      September 2003;

    * William S. Kirsch, 48, Conseco's president and chief
      executive officer, and a director since August 2004;

    * Debra J. Perry, 54, former senior managing director of
      Moody's Investors Service, and a director since June 2004;

    * Philip R. Roberts, 63, principal of Roberts Ventures LLC
      (consultant for investment management firms), former chief
      investment officer of trust business for Mellon Financial
      Corporation, and a director since September 2003;

    * Neal C. Schneider, 61, chairman of PMA Capital Corporation,
      former partner in charge of the Worldwide Insurance Industry
      Practice and the North American Financial Service Practice
      at Arthur Andersen & Co., and a director since September
      2003;

    * Michael S. Shannon, 47, president and chief executive
      officer of KSL Resorts (manager of golf courses and
      destination resorts), and a director since September 2003;

    * Michael T. Tokarz, 55, chairman of investment company MVC
      Capital, Inc., managing member of Tokarz Group
      (investments), former general partner with Kohlberg Kravis
      Roberts & Co., and a director since September 2003; and

    * John G. Turner, 65, chairman of Hillcrest Capital Partners
      (private equity investment firm), former vice chairman and
      member of the executive committee for ING Americas, former
      chairman and CEO of ReliaStar Financial Corp., and a
      director since September 2003.

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. 12, 2005,
assigned a B3 rating to Conseco Inc.'s $300 million convertible
debentures and a B2 rating to the company's $80 million revolving
credit facility.  Consistent with the rest of the ratings on
Conseco (except for Conseco Senior Health Insurance Company, the
ratings were placed on review for possible upgrade.

At the same time, Fitch Ratings assigned a 'BB-' rating to
Conseco, Inc.'s proposed issuance of $300 million of senior
unsecured convertible notes due 2035.  At the same time, Fitch has
assigned a 'BB+' rating to Conseco's senior secured bank debt, and
affirmed the company's 'BB' long-term (issuer) rating and 'B+'
preferred stock rating.  Fitch said the rating outlook for all
ratings is Stable.


CYPRESS SEMICONDUCTOR: SunPower to Conduct $115 Million IPO
-----------------------------------------------------------
SunPower Corporation, a subsidiary of Cypress Semiconductor
Corporation, filed with the Securities and Exchange Commission a
registration statement relating to the proposed initial public
offering of shares of its class A common stock.  The filing
provides for an offering of up to $100 million of common stock,
plus an option granted to the underwriters to purchase up to an
additional $15 million to cover over-allotments.

All shares are being offered by SunPower Corporation except those
shares which will be offered by certain selling stockholders in
the event the underwriters exercise their over-allotment option.
The shares will be offered by an underwriting group managed by
joint bookrunners Credit Suisse First Boston LLC and Lehman
Brothers, Inc. and co-managers SG Cowen & Co., LLC and First
Albany Capital, Inc.

SunPower says that the principal purposes for the offering are:

    * to increase our working capital,

    * create a public market for SunPower's class A common stock,

    * facilitate SunPower's future access to the public capital
      markets, and

    * increase SunPower's visibility in its markets.

SunPower intends to use the net proceeds for:

    * the expansion of its manufacturing capacity, and

    * general corporate purposes, including working capital.

Headquartered in Sunnyvale, California, SunPower Corporation,
designs, manufactures and sells solar electric power products.

Cypress Semiconductor Corporation designs, develops, manufactures,
and markets a line of digital and mixed-signal integrated
circuits.  The Company's circuits are used in the data
communications, telecommunications, computers, and instrumentation
systems markets.  The Company's products are marketed worldwide
through a network of sales offices, distributors, and sales
representatives firm.

                        *     *     *

Standard & Poor's rated the Company's 1.25% Convertible
Subordinated Plus Cash Notes due June 15, 2008 at B-.


DIRECTVIEW INC: Balance Sheet Upside-Down by $1.34-Mil at June 30
-----------------------------------------------------------------
DirectView, Inc., reported its financial results for the quarter
ending June 30, 2005, in a Form 10-Q delivered to the Securities
and Exchange Commission on August 17, 2005.  

DirectView reports $322,931 in revenue for the six months ended
June 30, 2005, as sales of teleconferencing equipment and
accessories by the company's five-person sales force fell more
than 17% from a year ago.   The company's net loss totaled
$1,168,175 for the six months ended June 30, 2005.

A full-text copy of DirectView's Quarterly Report is available for
free at http://ResearchArchives.com/t/s?123

DirectView, Inc., is a full-service provider of teleconferencing
products and services to businesses and organizations.  Effective
February 23, 2004, the Company completed its acquisition of all of
the issued and outstanding shares of Meeting Technologies, Inc., a
Delaware corporation, from its sole stockholder, Michael Perry.
Meeting Technologies, Inc., was a privately held provider of video
conferencing equipment and related services.  The Company's
results of operations for the six months ended June 30, 2004
include the results of Meeting Technologies, Inc., from the date
of acquisition of February 23, 2004.
                
At June 30, 2005, DirectView's balance sheet shows a $1,337,960
stockholders' deficit.


DOANE PET: Sells Business to Teachers' Private Capital for $840MM
-----------------------------------------------------------------
Teachers' Private Capital, the private investment arm of the
Ontario Teachers' Pension Plan, has signed an agreement to
purchase Doane Pet Care Company for C$1 billion (US$840 million).

"We are extremely pleased with the opportunity to invest
in a market-leading U.S. company," said Jim Leech, Senior
Vice-President, Ontario Teachers' Pension Plan. "The U.S. is a key
market for us, and we look forward to working with Doane's
excellent management team to help grow this business."

Doug Cahill, Doane Pet Care President and CEO, believes the new
ownership structure will enable the company to further develop its
global business and U.S. market position.

"Teachers' Private Capital has a rich history of investing in
strong companies with excellent long-term growth prospects and we
are delighted with their recognition of our tremendous potential
as well as our achievements in building Doane to its premier
market position," said Mr. Cahill.

"With the long-term commitment and financial stability provided by
Ontario Teachers', we have a unique opportunity to offer an even
higher level of product innovation and marketing support to help
new and existing customers build their brands."

The transaction is expected to close by mid-November.  Lehman
Brothers acted as Ontario Teachers' financial adviser on the
transaction.

                 About Teachers' Private Capital

Teachers' Private Capital is the private investment arm of the
C$88 billion Ontario Teachers' Pension Plan, which invests on
behalf of 255,000 active and retired teachers in Ontario, Canada.   
With more than C$7 billion in assets, Teachers' Private Capital is
one of North America's largest private investors and is currently
working with more than 100 companies and funds worldwide by
providing long-term flexible financing.

Significant investments include Samsonite, Worldspan, Alliance
Laundry Systems, Yellow Pages Group, and Maple Leaf Sports and
Entertainment (owners of the Toronto Raptors and Toronto Maple
Leafs sports teams).  Teachers' Private Capital specializes in
providing private equity and mezzanine debt capital for large and
mid-cap companies, venture capital for developing industries, and
financing for a growing portfolio of infrastructure and timberland
assets.

                      About Doane Pet Care

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

                         *     *     *

As reported in the Troubled Company Reporter on Nov 25, 2004,
Standard & Poor's Ratings Services raised its corporate credit
rating on pet food manufacturer Doane Pet Care Co. to 'B' from
'B-', as well as its senior unsecured debt and subordinated debt
ratings to 'CCC+' from 'CCC'.

At the same time, Standard & Poor's affirmed the 'B+' bank loan
rating and recovery rating of '1' on Doane's new $230 million
senior secured credit facility.  The ratings were removed from
CreditWatch, where they were placed October 11, 2004.  S&P said
the outlook is stable.

As reported in the Troubled Company Reporter on Oct. 18, 2004,
Moody's Investors Service assigned a B2 rating to the prospective
senior secured credit facilities of Doane Pet Care Company and
downgraded Doane's existing ratings.

Moody's ratings actions were:

   -- Doane Pet Care Company:

      * Existing $50 million senior secured revolver -- to B2 from
        B1,

      * Existing $165 million senior secured term loans -- to B2
        from B1,

      * Prospective $35 million senior secured revolver -- B2
        assigned,

      * Prospective $195 million term loan -- B2 assigned,

      * $212 million 10.75% senior unsecured notes, due 2010 -- to
        B3 from B2,

      * $150 million 9.75% senior subordinated notes, due 2007 --
        to Caa2 from Caa1

   -- Doane Products Company:

      * $98 million redeemable preferred securities -- to Ca from
        Caa2.

      * Senior Implied Rating -- to B3 from B2,

      * Unsecured Issuer Rating -- to Caa1 from B3,

      * Ratings Outlook -- Negative.


DOANE PET: S&P Places B Corporate Credit Rating on Watch Positive
-----------------------------------------------------------------
Standard & Poor's Ratings Services placed its ratings on private-
label pet food manufacturer, Doane Pet Care Co., on CreditWatch
with positive implications.  This includes the 'B' corporate
credit rating and other ratings on the company.
     
CreditWatch with positive implications means that the ratings
could be affirmed or raised following the completion of Standard &
Poor's review. T he Brentwood, Tennessee-based company's total
debt outstanding (including preferred stock) at July 2, 2005, was
about $696 million.
     
The CreditWatch placement follows the company's announcement that
it has entered into a definitive agreement to be acquired by
Teachers' Private Capital, the private investment arm of the
Ontario Teachers' Pension Plan, for total cash consideration of
$840 million.  As part of the transaction, Teachers' Private
Capital and Doane plan to complete a recapitalization, which is
expected to significantly reduce leverage.  A substantial equity
investment by Teachers' Private Capital will allow Doane to retire
all of its outstanding preferred stock and reduce the amount of
funded debt on its balance sheet.
     
Standard & Poor's will review Doane's operating and financial
plans with management before resolving the CreditWatch listing.
"Given the company's current business profile, a significant
reduction in Doane's existing debt levels and ability to improve
its financial profile, including extending debt maturities and
repayment of the costly preferred stock, could result in an
upgrade," said Standard & Poor's credit analyst Alison Sullivan.


E.DIGITAL CORP: Equity Deficit Widens to $2.79 Million at June 30
-----------------------------------------------------------------
e.Digital Corporation reported its financial results for the
quarter ending June 30, 2005, in a Form 10-Q delivered to the
Securities and Exchange Commission on August 15, 2005.

Gross profit for the first three months of fiscal 2006 was
$170,692 compared to $68,639 for the first three months of fiscal
2005.  Gross profit as a percent of sales for the first quarter of
fiscal 2005 was 17% compared to 74% for the same period last year.   
The gross margins for the Company's product have on average been
approximately 20%.  The decrease in product gross margin for the
period ending June 30, 2005, includes additional costs incurred
for the development of the enhanced in-flight entertainment
device.  At the present time, warranty costs are not significant.

The Company reported a loss for the first three months of fiscal
2006 of $647,276 as compared to a loss of $734,696 for the prior
first three months of fiscal 2005.

The loss attributable to Common Stockholders for the three months
ended June 30, 2005, and 2004 was $690,376 and $782,153,
respectively.  Included in the loss available to Common
Stockholders for the period ending June 30, 2005, were accrued
dividends on the Series D and Series EE stock of $33,450 and
$9,650, respectively.  Included in the loss available to Common
Stockholders for the period ending June 30, 2004, were accrued
dividends on the Series D and Series E stock of $38,039 and
$9,418, respectively.

                 Liquidity and Capital Resources

At June 30, 2005, the Company had working capital deficit of
$2,902,040 compared to a working capital deficit of $1,489,774 at
March 31, 2005.  Cash used in operating activities for the three
month period ended June 30, 2005, was $742,329 resulting primarily
from the $647,276 loss for the period, a decrease of $8,335 in
deferred revenue, an increase of $443,213 in prepaid expenses and
other, an increase of $76,432 in other accounts payable, an
increase of $27,577 in accrued employee benefits, and a decrease
of $28,642 in accounts receivable, an increase of $246,940 in
customer deposits.  During the three months ended June 30, 2005,
the Company purchased no additional property and equipment.

For the three months ended June 30, 2005, cash used in financing
activities was $5,061 resulting primarily from principal payment
on the 15% Unsecured Promissory Note.  For the three months ended
June 30, 2005, net cash and cash equivalents decreased by
$747,390.

At June 30, 2005, the Company had net accounts receivable of
$24,199 as compared to $52,841 at March 31, 2005.  The decrease in
receivables can be attributed to the Company's policy to grant
payment upon receipt terms to its customers.  Receivables can vary
dramatically due to the timing of product shipments and contract
arrangements on development agreements.

A full-text copy of e.Digital's Quarterly Report is available for
free at http://ResearchArchives.com/t/s?122

e.Digital Corporation is a holding company that operates through a
wholly owned California subsidiary of the same name and is
incorporated under the laws of Delaware.  The Company provides
engineering services, product reference designs and technology
platforms to customers focusing on the digital video/audio and
player/recorder markets.  

As of June 30, 2005, e.Digital's equity deficit widened to
$2,792,060 from a $2,260,569 deficit at March 31, 2005.


E.DIGITAL CORP: Needs $1 Million for the Next Year to Operate
-------------------------------------------------------------
e.Digital Corporation requires approximately $1,000,000 of
additional funds for the next twelve months of operations plus
amounts required to make payments on the 15% Unsecured Notes of
$750,000, 15% Note of $150,000 and the 12% Subordinated Promissory
Note of $1,000,000.  

At June 30, 2005, the Company had cash and cash equivalents of
$541,863.  Other than cash and cash equivalents and accounts
receivable, the Company had no material unused sources of
liquidity at this time. The Company had no material commitments
for capital expenditures or resources.  

The Company believes it may be able to obtain additional funds
from future product margins from branded and OEM product sales but
actual future margins to be realized, if any, and the timing of
shipments and the amount and quantities of shipments, orders and
reorders are subject to many factors and risks, many outside our
control.  The Company has forebearance agreements on the $947,919
principal and accrued interest on the 15% Unsecured Note and the
timing and schedule of amounts due thereafter are not currently
known.  Accordingly the Company may need to seek equity or debt
financing in the next twelve months for working capital if product
margins are insufficient and we may need to seek equity or debt
financing for payments of the 15% Unsecured Note and 15% Note and
other obligations reflected on its balance sheet.

The Company said there is no guarantee that it will be able to
raise additional equity or debt financing, if required, or
renegotiate the terms of debts as they arise.  The Company may
also require additional capital to finance future developments and
improvements to its technologies or develop new technologies.

Should additional funds not be available, the Company may be
required to curtail or scale back staffing or operations.  Failure
to obtain additional financings will have a material adverse
affect on its Company.  Potential sources of funds include
exercise of outstanding warrants and options, or debt financing or
additional equity offerings.  However, there is no guarantee that
warrants and options will be exercised or that debt or equity
financing will be available when needed.  Any future financing may
be dilutive to existing stockholders.

The Company has incurred significant losses and negative cash flow
from operations in each of the last three years and has an
accumulated deficit of $72,640,128 at June 30, 2005.  At June 30,
2005, the Company had a working capital deficiency of $2,902,040.
The Company's monthly cash operating costs have been on average
$180,000 and $215,000 per month for the periods ending June 30,
2005 and 2004, respectively.  

However, it may increase expenditure levels in future periods to
support and expand its revenue opportunities and continue advanced
product and technology research and development.  Accordingly, the
Company's losses are expected to continue until the time, as the
Company is able to realize supply, licensing, royalty, sales, and
development revenues sufficient to cover the fixed costs of
operations.  

The Company have experienced a substantial reduction in cash that
adversely affects its liquidity.  The Company's operating plans
require additional funds, which may take the form of debt or
equity financings.  There can be no assurance that any additional
funds will be available to the company on satisfactory terms and
conditions, if at all.  The Company's ability to continue as a
going concern is in substantial doubt and is dependent upon
achieving a profitable level of operations and, if necessary,
obtaining additional financing.

The Company's management has undertaken steps as part of a plan to
improve operations with the goal of sustaining its operations for
the next twelve months and beyond.  These steps include

   (a) controlling overhead and expenses;

   (b) expanding sales and marketing to business customers and
       markets; and

   (c) raising, if necessary, additional capital or obtaining
       third party financing.

e.Digital Corporation is a holding company that operates through a
wholly owned California subsidiary of the same name and is
incorporated under the laws of Delaware.  The Company provides
engineering services, product reference designs and technology
platforms to customers focusing on the digital video/audio and
player/recorder markets.  

As of June 30, 2005, e.Digital's equity deficit widened to
$2,792,060 from a $2,260,569 deficit at March 31, 2005.


EAGLEPICHER INC: GE Railcar Demands Decision on Lease Agreement
---------------------------------------------------------------
General Electric Railcar Services Corporation, a creditor holding
approximately $80,259 in unsecured prepetition claims in
EaglePicher Incorporated's chapter 11 case, asks the U.S.
Bankruptcy Court for the Southern District of Ohio, Western
Division, to lift the automatic stay so it can terminate its
unexpired lease and reclaim 119 of its railcars from the Debtor.

The Debtor has rented railcars from GE Railcar since 1984 pursuant
to a master leasing agreement.  The leasing agreement allows the
Debtor use of GE Railcar's railcars.  Under the lease agreement,
GE Railcar is also obliged to provide maintenance and
administrative support services for the leased equipment.

GE Railcar's counsel, Martin Weis, Esq., at Dilworth Paxson LLP,
tells the Bankruptcy Court that the Debtor continues to use the
railcars postpetition without making the necessary payments to
General Electric.  Mr. Weis says that the Debtor owes General
Electric approximately $231,064 for postpetition use of the
railroad cars.

GE Railcar wants to terminate the lease agreement because the
Debtor has not been prompt in paying its postpetition obligations
and because the Debtor has not sought approval to assume or reject
the agreement.  GE Railcar further says that the rented railcars
are not necessary to the Debtor's reorganization.

In the event that the Bankruptcy Court does not allow the
termination of the lease, GE Railcar wants the Bankruptcy Court to
compel the Debtor to provide adequate protection of its interests.
As adequate protection, GE Railcar wants the Debtor to:

    a) pay its $231,064 postpetition liability by August 31, 2005;

    b) promise to pay all monthly invoices when due pursuant to
       the terms of the lease and rental agreements; and
    
    c) file a motion either to assume or reject the leases by Oct.
       31, 2005.  Failure to file a motion by the deadline will
       mean the automatic rejection of the leases and the Debtor
       will be required to return the railcars.

A schedule of the Debtor's post-petition obligations to GE Railcar
is available for free at http://ResearchArchives.com/t/s?127

General Electric Railcar Services Corporation --
http://www.ge.com/railservices/-- is a leading service provider  
to the rail industry.  GE Railcar offers one of the most diverse
fleet of railcars in the business, as well as a full range of
intermodal assets, to transport vital commodities where and when
they are needed.  The Company also offers a full range of flexible
leasing products - from per diem leases to sale/leasebacks - to
help clients meet operational and financial goals.   GE Railcar
maintains superior performance from its transportation assets.  
The Company's suite of maintenance, repair, engineering and
administrative services lets clients maintain their focus on their
business.

Headquartered in Phoenix, Arizona, EaglePicher Incorporated
-- http://www.eaglepicher.com/-- is a diversified manufacturer    
and marketer of innovative advanced technology and industrial
products for space, defense, automotive, filtration,
pharmaceutical, environmental and commercial applications
worldwide.  The company along with its affiliates and parent
company, EaglePicher Holdings, Inc., filed for chapter 11
protection on April 11, 2005 (Bankr. S.D. Ohio Case No. 05-12601).
When the Debtors filed for protection from their creditors, they
listed $535 million in consolidated assets and $730 in
consolidated debts.


ENRON CORP: Gets Court Nod to Amend DCR Guidelines
--------------------------------------------------
Pursuant to the Confirmation Order of the Reorganized Debtors'
Fifth Amended Chapter 11 Plan, the Court specifically approved
the formation of a Disputed Claims Reserve and the appointment of
the Reserve's overseers.

The Plan Supplement contains the guidelines governing the Disputed
Claims Reserve.  All cash held in the DCR must be either:

    -- held in an interest bearing account with a depositary
       institution or trust company organized under the laws of
       the United States of America or any its state, subject to
       supervision and examination by United States or state
       banking or depositary institution authorities and having
       reported capital and surplus in excess of $100,000,000; or

    -- invested in interest-bearing obligations issued by the
       U.S. Government, or by its agency and guaranteed by the
       U.S. Government, and having a maturity of not more than 30
       days.

Brian S. Rosen, Esq., at Weil, Gotshal & Manges LLP, in New York,
tells the Court that the Reorganized Debtors want to amend the
investment guidelines for the DCR.  By amending the guidelines,
they hope to maximize value for their creditors while continuing
to maintain cash held by the DCR in low-risk investments that
provide the necessary liquidity for them to make distributions
from the DCR in accordance with the terms of the Plan.

With the current economic environment, the Reorganized Debtors
believe that cash held by the DCR and invested in interest-
bearing accounts pursuant to the current investment guidelines is
receiving a relatively low rate of return.  Although interest
rates remain low across the market, the proposed change in the
investment guidelines will assist the Debtors in maximizing value
for creditors by allowing them to invest the DCR's cash in
investments that potentially bear higher rates of interest yet
are still fully backed by the full faith and credit of the U.S.
Government.

Accordingly, the Reorganized Debtors seek the Court's permission
to amend the investment guidelines for the DCR to permit cash
held by the DCR to be invested in:

   (a) short-term Treasury bills with maturities that provide for
       the liquidity requirements of the next scheduled
       distribution date, each having maturities of not more than
       six months;

   (b) money market mutual funds rated AAA (S&P) or Aaa (Moody's)
       that invest solely in U.S. Treasury securities or
       repurchase agreements fully collateralized by U.S. Treasury
       securities; or

   (c) secured deposits at domestic banks or other financial
       institutions having a shareholders' equity or equivalent
       capital of not less than $100 million.

                           *     *     *

Judge Gonzalez grants the Reorganized Debtors' request.

Headquartered in Houston, Texas, Enron Corporation --
http://www.enron.com/-- is in the midst of restructuring various    
businesses for distribution as ongoing companies to its creditors
and liquidating its remaining operations.  Before the company
agreed to be acquired, controversy over accounting procedures had
caused Enron's stock price and credit rating to drop sharply.

Enron filed for chapter 11 protection on December 2, 2001 (Bankr.
S.D.N.Y. Case No. 01-16033).  Judge Gonzalez confirmed the
Company's Modified Fifth Amended Plan on July 15, 2004, and
numerous appeals followed.  The Confirmed Plan took effect on
Nov. 17, 2004. Martin J. Bienenstock, Esq., and Brian S. Rosen,
Esq., at Weil, Gotshal & Manges, LLP, represent the Debtors in
their restructuring efforts.  (Enron Bankruptcy News, Issue No.
157; Bankruptcy Creditors' Service, Inc., 15/945-7000)


FARMLAND INDUSTRIES: Trustee Wants to Sell $3.6M Equity Interests
-----------------------------------------------------------------
J.P. Morgan Trust Company, N.A., the Liquidating Trustee for the
FI Liquidating Trust, asks the U.S. Bankruptcy Court for the
Western District of Missouri for authority to sell Reorganized
Farmland Industries Inc.'s equity interests in CoBank, ACB and AG
Processing Inc. free and clear of liens and interests to CHS Inc.
for $3,685,000.

CoBank is an agricultural credit bank that offers financial and
leasing services primarily to agribusinesses, rural communications
and energy systems and farm credit associations.  Farmland's
equity interest amounts to 0.25% of the total shareholders' equity
of CoBank, with a book value of $5.75 million.

AG Processing is a farmer-owned cooperative, engaged in the
procurement, processing, marketing and transportation of soybeans,
grain, feed and related products.  Farmland's equity interest
amounts to 1.5% of the total members equity, with a book value of
$6.4 million.

CHS' purchase price represents a 30% discount of the aggregate
book value of Farmland's total equity.

The Debtor proposes to conduct an auction on Sept. 26, 2005, and a
sale hearing on Sept. 27.

Farmland Industries, Inc., was one of the largest agricultural
cooperatives in North America with about 600,000 members.  The
firm operates in three principal business segments: fertilizer
production; pork processing, packing and marketing; and beef
processing, packing and marketing.  The company, along with its
affiliates, filed for chapter 11 protection (Bankr. W.D. Mo.
Case No. 02-50557) on May 31, 2002 before the Honorable Jerry W.
Venters.  The Debtors' Counsel is Laurence M. Frazen, Esq. of
Bryan Cave LLP.  When the Debtors filed for chapter 11 protection,
they listed total assets of $2.7 billion and total debts of $1.9
billion.  Pursuant to the Second Amended Joint Plan of
Reorganization filed by Farmland Industries, Inc. and its debtor-
affiliates, the court declared May 1, 2004 as the Effective Date
of the Plan.


FASSBERG CONSTRUCTION: List of 20 Largest Unsecured Creditors
-------------------------------------------------------------
Fassberg Construction Company' released a list of its 20 Largest
Unsecured Creditors:

    Entity                    Nature Of Claim       Claim Amount
    ------                    ---------------       ------------
H.A.C.L.A.                                            $4,847,000
Stephan, Oringer, Richman
2029 Century Park East,
Sixth Floor
Los Angeles, CA 90067

Paul Lax, Esq.                Legal services            $418,534
Lax & Stevens
350 South Grand Avenue
Suite 1550
Los Angeles, CA 90071

Howard-Young International    Expert witness            $154,795
30 Anthem Creek Circle
Henderson, NV 89052

Premium Assignment Corp.      Financed general          $142,494
                              liability insurance

Zurich North America          GL insurance audit        $115,349

Schwartz & Janzen, LLP        Legal services             $25,066

Schulze Haynes & Co., LLC     Legal services             $23,822

WWCOT Architecture Planning   Expert witness             $22,963

IPS-Trial Dynamics            Expert witness             $15,636

Karyn Abbott & Associates     Expert witness              $6,927

Nitro & Associates            Expert witness              $4,340

Viking Office Products        Office supplies             $3,425

Staples Inc.                  Office supplies             $1,831

Home Depot Commercial Credit  Credit card                   $399
                              Re: Job supplies

Cingular Wireless             Cellular phones               $298

United Parcel Service         Delivery service              $282

Hector Villapando             Repair & Supplies for         $260
                              copier mach

Custom Wireless Choices       Cellular phones               $234

Custom Mobile Sound                                         $234

SBC                           Telephone                     $145                

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.  When the Debtor filed for protection from its creditors, it
had assets of $15,267,175 and debts of $6,758,113.


FASSBERG CONSTRUCTION: Taps Schwartz Janzen as Litigation Counsel
-----------------------------------------------------------------
Fassberg Construction Company sought and obtained permission from
the U.S. Bankruptcy Court for the Central District of California,
San Fernando Division, to employ Schwartz & Janzen, LLP as its
litigation counsel.

Schwartz & Janzen will advise and represent the Debtor in six
legal proceedings:

    (a) CST Environmental Inc. vs. Fassberg Construction Company,
        et al.;

    (b) Joel Sternliev Electric, Inc. vs. Fassberg Construction;

    (c) Cortine Village, LP vs. Fassberg Construction;

    (d) Joe Brooks, et al. vs. Fassberg Construction;

    (e) Fassberg Construction, et al. vs. Oak Creek Housing
        Investors, LP; and

    (f) Talk-A-Phone Company vs. Digital Systems Solutions, Inc.
        et al.

The attorneys who will represent the Debtor are:

    Attorney                    Designation       Hourly Rate
    --------                    -----------       -----------
    Steven H. Schwartz, Esq.    Partner              $250
    Roland R. Tijerina, Esq.    Partner              $225
    Noel E. Macaulay, Esq.      Senior Associate     $200

Roland R. Tijerina, Esq., a partner at Schwartz & Janzen,
discloses that the Firm received a pre-petition retainer in the
amount of $100,000.

Mr. Tijerina assures the court that the Firm is a "disinterested
person" as that term is defined in Section 101(14) of the
Bankruptcy Code.

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.  When the Debtor filed for protection from its creditors, it
had assets of $15,267,175 and debts of $6,758,113.


FIRST LIBERTY: Case Summary & 20 Largest Unsecured Creditors
------------------------------------------------------------
Debtor: First Liberty Group, L.L.C.
        aka 1st Liberty Group, LLC
        P.O. Box 340626
        Tampa, Florida 33694

Bankruptcy Case No.: 05-17216

Chapter 11 Petition Date: August 30, 2005

Court: Middle District of Florida (Tampa)

Debtor's Counsel: Guillermo A. Ruiz, Esq.
                  Guillermo A. Ruiz, PA
                  P.O. Box 12787
                  2901 5th Avenue North
                  Saint Petersburg, Florida 33733
                  Tel: (727) 321-2728
                  Fax: (727) 321-9104

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

Estimated Debts:  $1 Million to $10 Million

Debtor's 20 Largest Unsecured Creditors:

   Entity                     Nature of Claim       Claim Amount
   ------                     ---------------       ------------
CMD Realty Invest. Fnd III/   Judgment                  $173,438
CMD Reim III, Inc.
c/o Ross Realty Group
3001 Executive Drive, #250
Clearwater, FL 33762

Bagnall, Clifford F.          Promissory notes           $85,000
8908 Citrus Village Drive
#101
Tampa, FL 33626

Bank of America               Recorded UCC-1             $72,438
CCS Small Business/Premier    7/12/2004
FL9-100-02-14                 All Inventory,
P.O. Box 40329                Chattel Papers,
Jacksonville, FL 32203-0329   Accounts, Equipment,
                              General intangibles,
                              etc.
                              Value of security:
                              $50,000

GMAC                          Vehicle leases             $72,000
                              (approximate
                              balance due on
                              leases)

Squire Sanders & Dempsey LLP                             $51,224

BBG Investments               Promissory note            $44,286

Carlton Fields, P.A.          Attorneys fees             $32,415

GE Capital                    Lease                      $27,751

St. Petersburg Times          Advertising expense        $19,296

Bank of America (#8029)       Credit card                $15,330


BBG Risk Management           Promissory note            $14,455

Dynamic Solutions Group,      Trade debt                 $14,417
Inc.

Media General/Tampa Tribune   Judgment                   $14,129

Kiefner & Hunt, P.A.          Attorneys fees             $12,533

Gleaner Life Ins. Society                                $11,180

Stuart Allen & Associates                                $10,883

Sarasota Herald               Lawsuit filed -             $9,131
                              advertising expense

Miami Herald                  Judgment                    $8,878

Palm Beach Newspapers         Advertising expense         $8,321

Collier County Publishing     Lawsuit filed/              $8,037
Co.                           Collier County,
                              Florida advertising


FONIX CORP: June 30 Balance Sheet Upside-Down by $5 Million
-----------------------------------------------------------
Fonix Corp. generated revenues of $4,324,000 for the three months
ended June 30, 2005 compared to $4,242,000 for the three months
ended June 30, 2004.  The Company incurred a net loss of
$4,337,000 for the three months ended June 30,2005 compared with a
net loss of $5,565,000 for the same period in 2004.

For the six months ended June 30, 2005 the Company generated
revenues of $8,547,000 versus revenues of $6,168,000 for the same
period in 2004.  Net loss for the six-month period ended June
30,2005 was $8,414,000 versus a net loss of $7,905,000 for the
same period in 2004.  The company also reported negative cash flow
from operating activities of $4,369,000 for the six months ended
June 30, 2005.

As of June 30, 2005, the Company had:

    * an accumulated deficit of $235,612,000;
    * negative working capital of $15,207,000;
    * accrued liabilities of $7,674,000;
    * accounts payable of $5,903,000; and
    * accrued employee wages and other compensation of $501,000.

The Company expects to continue to incur significant losses and
negative cash flows from operating activities through at least
December 31, 2005, primarily due to significant expenditure
requirements associated with continued marketing and development
of its speech-enabling technologies and further developing its
telecommunications services business.

The Company's cash resources, limited to collections from
customers, plus draws on the Sixth and Seventh Equity Lines and
loans, have not been sufficient to cover operating expenses.  As a
result, payments to employees and vendors have been delayed.  The
Company had not been declared in default under the terms of any
material agreements.

Management plans to fund future operations of the Company through
revenues generated from its telecommunications operations, from
cash flows from future license and royalty arrangements and with
proceeds from additional issuance of debt and equity securities.
There can be no assurance that management's plans will be
successful.

The Company had negative working capital of $15,207,000 at June
30, 2005, compared to negative working capital of $13,580,000 at
December 31, 2004.  Current assets decreased by $224,000 to
$1,896,000 from December 31, 2004, to June 30, 2005.  Current
liabilities increased by $1,403,000 to $17,103,000 during the same
period.  The change in working capital from December 31, 2004, to
June 30, 2005, reflects, in part, increases resulting from
increased accrued liabilities of $859,000, increased accounts
payable of $678,000, reduced accounts receivable of $328,000,
increased related party notes payable of $110,000 and the
reclassification of long-term debt to current debt of $944,000,
partially offset by the decreased accrued payroll balance of
$1,255,000 due to scheduled payments made during the period and
increased prepaid assets of $134,000.  Total assets were
$16,297,000 at June 30, 2005, compared to $19,000,000 at December
31, 2004.

Sales of products and telecommunications services and revenue from
licenses based on the Company's technologies have not been
sufficient to finance ongoing operations, even though the Company
has limited capital available under an equity line of credit.

Its continued existence is dependent upon several factors,
including success in:

    (1) increasing telecommunications services, license, royalty
        and services revenues;

    (2) raising sufficient additional funding; and

    (3) minimizing operating costs.

Until sufficient revenues are generated from operating activities,
management expects to continue to fund operations through the sale
of equity securities, primarily in connection with the Seventh
Equity Line.  The Company is currently pursuing additional sources
of liquidity in the form of:

    * traditional commercial credit,

    * asset based lending, or

    * additional sales of Company equity securities to finance its
      ongoing operations.

Additionally, management is pursuing other types of commercial and
private financing, which could involve sales of Company assets or
sales of one or more operating divisions.  Fonix' sales and
financial condition have been adversely affected by its reduced
credit availability and lack of access to alternate financing
because of its significant ongoing losses and increasing
liabilities and payables.  Over the past several months, the
Company has reduced its workforce in the speech business unit by
approximately 50%.  This reduction may adversely affect Fonix'
ability to fill existing orders.  

Fonix Corp., -- http://www.fonix.com/-- based in Salt Lake City,  
is an innovative communications and technology company that
provides integrated telecommunications services and value-added
speech technologies through Fonix Telecom Inc., LecStar Telecom
Inc. and The Fonix  
Speech Group.  The combination of interactive speech technology
and integrated telecommunications services allows Fonix to provide
customers with comprehensive cost-effective solutions to enhance
and expand their communications needs.  

At June 30, 2005, Fonix Corp.'s balance sheet showed a $5,323,000
stockholders' deficit, compared to a $2,058,000 deficit at  
Dec. 31, 2004.

                          *     *     *

                       Going Concern Doubt  

As reported in the Troubled Company Reporter on May 17, 2005,
Hansen, Barnett & Maxwell issued a going concern opinion after it
audited the Company's financial statements for the fiscal year
ended Dec. 31, 2004, filed with the Securities and Exchange  
Commission.  The Company's cash resources, limited to collections
from customers, draws on the Sixth Equity Line and loans, have not
been sufficient to cover operating expenses.  As a result,
payments to employees and vendors have been delayed.  The Company
has not been declared in default under the terms of any material
agreements.   

                       Bankruptcy Warning

"Until sufficient revenues are generated from operating
activities, we expected to continue to fund our operations through
the sale of our equity securities, primarily in connection with
the Sixth Equity Line," the Company stated in its quarterly
report.  "We are currently pursuing additional sources of
liquidity in the form of traditional commercial credit, asset
based lending, or additional sales of our equity securities to
finance our ongoing operations.  Additionally, we are pursuing
other types of commercial and private financing, which could
involve sales of our assets or sales of one or more operating
divisions.  Our sales and financial condition have been adversely
affected by our reduced credit availability and lack of access to
alternate financing because of our significant ongoing losses and
increasing liabilities and payables.  Over the past year, we have
reduced our workforce in our speech business unit by approximately  
50%.  This reduction may adversely affect our ability to fill
existing orders.  As we have noted in our annual report and other
public filings, if additional financing is not obtained in the
near future, we will be required to more significantly curtail our
operations or seek protection under bankruptcy laws."


FOOTSTAR INC: Judge Hardin Approves Settlement Pact with Sears
--------------------------------------------------------------          
The Honorable Adlai S. Hardin Jr. of the U.S. Bankruptcy Court for
the Southern District of New York approved the Settlement
Agreement and the Amended Master Agreement between Footstar Inc.,
and its debtor-affiliates and Kmart Corporation on Aug. 25, 2005.

Since last year, the Debtors and Kmart have been involved in
numerous litigations concerning Footstar's decision to assume the
Master Agreement, which Kmart opposed.

After the Debtors filed their chapter 11 Plan in November 2004,
they and Kmart Corp. resumed negotiations to resolve the
litigations and provide for the assumption of the Master Agreement
with some modifications.

The Debtors and Kmart Corp. entered into the Settlement Agreement
on July 2, 2005, to resolve all disputes between the Debtors and
Kmart.  That Settlement repairs the Debtors' business
relationship with Kmart, enabling the Debtors to operate
profitably throughout the remaining term of the relationship.  The
Settlement will facilitate the Debtors' reorganization process,
ensure a complete recovery to creditors, and provide a return to
equity.

               Summary of the Settlement Agreement

The Settlement Agreement:

   1) fixes Footstar's cure obligation at $45 million and
      establishes a minimum footprint of stores in which Footstar
      will continue to operate a footwear department and requires
      Kmart to compensate Footstar for closures or conversions
      if the number of stores falls below the minimum;

   2) eliminates uncertainties relating to Footstar's staffing
      obligations by allowing Footstar to reduce staffing as sales
      decline and eliminates the Performance Standards in favor
      of a minimum sales test, which eliminates a key possible
      termination right for Kmart;

   3) eliminates Kmart's equity interests in the Shoemart
      Corporations and eliminates profit sharing and all other
      fees in favor of Footstar paying Kmart, as of Jan. 2, 2005,
      14.625% of Gross Sales, other than the Miscellaneous Expense
      Fee, which is fixed at $23,500 per store;

   4) reduces Footstar's liquidation costs by requiring Kmart to
      buy out Footstar's inventory at book value in the event of
      any store closure or conversion;

   5) provides that the Master Agreement will terminate at the end
      of 2008, instead in mid-2012, requires Kmart to buy out
      Footstar's inventory, but not its brands, at book value upon
      any store closure or conversion, which allows for an orderly
      wind down of the business without the need for a complex
      liquidation and its attendant costs; and

   6) requires Kmart to allocate a minimum of 52 weekend Roto
      advertising pages per year to Footstar products.

Pursuant to the Settlement, Judge Hardin orders the Debtors to:

   1) pay the $45 million Cure Amount, plus the $14 million Fee
      True-Up Amount to Kmart Corp., and pay the remaining portion
      of the Fee True-Up Amount, if any, to Kmart by Sept. 6,
      2005;

   2) if it is determined that the actual Fee True-Up Amount is
      less than $14 million, Kmart will promptly refund the
      difference between the $14 million good-faith payment and
      the actual Fee True-Up Amount; and

   3) the Settlement Agreement may only be modified, amended or
      supplemented by the mutual agreement of the Debtors and
      Kmart, after consultation with the Equity Holders Committee  
      in a writing signed by the parties without further order of
      the Court, provided, however, that any modification,
      amendment, or supplement will not be material in nature and
      not change the economic substance of the transactions under
      the Settlement.

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


G-STAR 2002-1: Fitch Lifts Rating on $16MM Notes 1 Notch to BBB-
----------------------------------------------------------------
Fitch Ratings upgrades four classes and affirms two classes of
notes issued by G-Star 2002-1 Ltd./G-Star 2002-1 Corp.  These
affirmations are the result of Fitch's annual review process.  The
following rating actions are effective immediately:

   These classes have been affirmed:

     -- $157,919,266 class A-1MM notes at 'AAA/F1+';
     -- $71,049,215 class A-2 notes at 'AAA';

   The following classes have been upgraded:

     -- $23,000,000 class BFL notes to 'A' from 'A-';
     -- $27,300,000 class BFX notes to 'A' from 'A-';
     -- $16,250,000 class C notes to 'BBB-' from 'BB+';
     -- $10,200,000 class D notes to 'BB' from 'BB-'.

G-Star 2002-1 is a collateralized debt obligation managed by GMAC
Institutional Advisors, which closed April 25, 2002.  G-Star 2002-
1 is backed by a static pool of commercial mortgage-backed
securities (CMBS 51.4%) and senior unsecured real estate
investment trust (REIT 48.6%) securities.  Included in this
review, Fitch discussed the current state of the portfolio with
the asset manager and their portfolio management strategy going
forward.  In addition, Fitch conducted cash flow modeling
utilizing various default timing and interest-rate scenarios.

Since the last rating action in September 2004, the collateral has
continued to perform while becoming increasingly seasoned.  The
Fitch weighted average rating has improved to 'BBB/BBB-' from
'BBB-/BB+' at the previous review date.  According to the most
recent trustee report dated July 18, 2005, the class A, B, and C
overcollateralization ratios were 136.4%, 111.8%, and 105.7%,
respectively, compared with triggers of 122.8%, 108.2%, and
104.5%, respectively.  There is one asset (COMM 2001-J2A)
representing 1.8% of the $318 million of total collateral that had
previously experienced an interest shortfall; however, this asset
is now current on its interest payments.

The rating of the class A-1MM and A-2 notes addresses the
likelihood that investors will receive full and timely payments of
interest, as per the governing documents, as well as the stated
balance of principal by the legal final maturity date.  In
addition, the class A-1MM note short-term rating addresses the
noteholders' ability to put the notes back to the put provider on
its next applicable remarketing date, which will be no later than
six months from its prior remarketing date.

The ratings of the class B and class C notes address the
likelihood that investors will receive ultimate and compensating
interest payments, as per the governing documents, as well as the
stated balance of principal by the legal final maturity date.  The
ratings of the class D notes address the likelihood that investors
will receive the ultimate stated balance of principal by the legal
final maturity date.  The class D notes have paid approximately
$4,067,554 of the initial $10,200,000 balance since closing.

Fitch's current asset-backed securities collateral asset manager
rating for GMAC Institutional Advisors LLC is 'CAM1'.  Fitch will
continue to monitor CREST G-STAR 2001-1 closely to ensure accurate
ratings.  For more information on GIA's collateral asset manager
rating, see the report 'GMAC Institutional Advisors LLC,' dated
March 15, 2004, available on the Fitch web site at
http://www.fitchratings.com/

Fitch conducted cash flow modeling utilizing various default
timing and interest-rate scenarios to measure the breakeven
default rates relative to the minimum cumulative default rates
required for the rated liabilities.  As a result of this analysis,
Fitch has determined that the original ratings assigned to the
class A-1MM and class A-2 notes still reflect the current risk to
noteholders; however, the current ratings assigned to the classes
BFL, BFX, C, and D notes no longer reflect the current risk to
noteholders and have subsequently improved since closing.

Fitch will continue to monitor and review these transactions for
future rating adjustments.  Additional deal information and
historical data are available on the Fitch 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/


GASEL TRANSPORTATION: Wants to Convert Case to Chapter 7
--------------------------------------------------------
Gasel Transportations Lines, Inc. (OTC BB: GSEL), operating as a
Post Confirmation Debtor under Chapter 11 Reorganization, said
that the negative results of its second quarter operations
indicated that its approved Plan and underlying business model was
not working.

As a solution, on June 21, 2005, the Company accepted and
initiated an arrangement with a larger logistics service
organization to restructure its operations and business model,
transitioning Gasel to a non-asset-based operation.

The U.S. Bankruptcy Court, in a status hearing on July 19, 2005,
granted Gasel 90 days to submit and seek approval of a
modification to its confirmed plan to transition to a non-asset-
based operation, while voluntarily turning over its transportation
equipment and real estate to the secured lenders by August 1,
2005, shedding its related debt and excessive operating costs.

The sudden and unexpected termination of the arrangement with the
logistics company on August 1, 2005, forced Gasel to cease
operations on August 12, 2005.  The Company also announced that it
plans to file a motion to convert to Chapter 7 of the Federal
Bankruptcy Code for the liquidation of the company.

Gene Thompson, who was recently appointed President of the Company
to facilitate the business model transition and expand its
operations, expressed dismay.  "What a tragic turn of events for
the employees, creditors, and shareholders, especially considering
how far the Company had come in its reorganization," Mr. Thompson
said.  "Every effort has been made to place the employees with
other jobs during and after the short business model transition
period.  At this point, every effort will be made to close the
Company and turn over the assets to the creditors and a Bankruptcy
trustee properly."

Headquartered in Marietta, Ohio, Gasel Transportation Lines, Inc.  
-- http://www.gasel.net/-- is a national long and regional haul  
truckload common and contract carrier, and provides logistic
services throughout the continental United States and Canada.  The  
Company filed for chapter 11 protection on May 19, 2003 (Bankr.
S.D. Ohio Case No. 03-57447).  Grady L Pettigrew, Jr., Esq., at  
Cox Stein & Pettigrew Co LPA, represents the Debtor in its
restructuring efforts.  The Court confirmed the Debtor's Amended
Plan of Reorganization on Dec. 30, 2004.

At Mar. 31, 2005, Gasel Transportation Lines, Inc.'s balance sheet
showed a $1,265,555 stockholders' deficit, compared to a
$1,324,789 deficit at Dec. 31, 2004.


GREAT LAKES: S&P Says Junk Debt Ratings Remain on Negative Watch
----------------------------------------------------------------
Standard & Poor's Ratings Services said that its ratings on Great
Lakes Dredge & Dock Corp. will remain on CreditWatch with negative
implications, where they were placed June 10, 2005.  This includes
the 'CCC+' corporate credit and senior secured debt ratings on
the company, as well as the 'CCC-' subordinated debt rating.  
Great Lakes, a dredging services provider based in Oak Brook,
Illinois, had roughly $258 million in total debt on the balance
sheet at June 30, 2005.
      
"The continued CreditWatch listing reflects Standard & Poor's
concern about the company's continuing liquidity and cash flow
generation issues," said Standard & Poor's credit analyst James T.
Siahaan.
     
Great Lakes has temporarily improved its liquidity profile by
amending its credit facility to address short-term working capital
needs.  Revolving credit facility borrowing availability has
increased by $5 million, though this also represents an equal
decrease in LOC capacity.  As of August 24, 2005, availability
under the revolving credit facility is $20 million.
     
Although Great Lakes was able to meet its June 15 bond interest
payment, its liquidity position remains tight, as the additional
availability will exist only until October 31, 2005, or until the
company can collect on a certain contract receivable, whichever
comes first.  Given the company's upcoming December 22 interest
payment and the volatile working capital requirements of the
dredging industry, the condition of the company's liquidity is of
concern.


HANGER ORTHOPEDIC: Lenders Okay Credit Loan Amendments
------------------------------------------------------
Hanger Orthopedic Group, Inc. (NYSE: HGR) disclosed the approval
of an amendment to its revolving credit facility and term loan B.

Hanger Orthopedic Group, Inc. engaged GE Healthcare Financial
Services, the administrative agent for its bank facility, to both
amend the financial covenants and extend the maturity of the
revolving credit facility.  Hanger received approvals from the
requisite lenders and the amendment was effective on Friday,
Aug. 26, 2005.

The most significant changes to the existing agreement included
extending the term of the revolving credit facility to match the
maturity of the term B and reducing the face amount of the
revolving credit facility from $100 to $75 million.  The reduction
in the revolving credit facility will save the Company fees and
provide adequate borrowing capacity given the fact that only
$13 million was outstanding at June 30, 2005.  All the financial
covenants of both facilities were amended to levels that are
consistent with Hanger's current and anticipated financial
performance and to provide satisfactory borrowing capacity.

Hanger Orthopedic Group, Inc., headquartered in Bethesda,
Maryland, is the world's premier provider of orthotic and
prosthetic patient-care services. Hanger is the market leader in
the United States, owning and operating 618 patient-care centers
in 45 states including the District of Columbia, with 3,405
employees including 1,017 practitioners. Hanger is organized into
four units. The two key operating units are patient-care which
consists of nationwide orthotic and prosthetic practice centers
and distribution which consists of distribution centers managing
the supply chain of orthotic and prosthetic componentry to Hanger
and third party patient-care centers. The third is Linkia which is
the first and only provider network management company for the
orthotics and prosthetics industry. The fourth unit, Innovative
Neurotronics, introduces emerging neuromuscular technologies
developed through independent research in a collaborative effort
with industry suppliers worldwide.

                        *     *     *

Hanger Orthopedic's 10-3/8% senior notes due 2009 carry Moody's
Investors Service's B3 rating and Standard & Poor's CCC rating.


HOLLINGER INT'L: Expects to File 2004 Annual Report by Sept. 15
---------------------------------------------------------------
Hollinger International Inc. (NYSE: HLR) expects to file its
Annual Report on Form 10-K for the year ended December 31, 2004
with the U.S. Securities and Exchange Commission by the close of
the market on Thursday, September 15, 2005.

The Company had previously announced an expectation to file the
2004 10-K at the end of this month.  The two-week delay results
from the additional time required to complete a restatement of
prior years' financial statements relating to U.S. federal tax
matters in 1998 and 1999 and the time required to complete
additional testing under Section 404 of the Sarbanes-Oxley Act of
2002.  With respect to the Company's 2003 balance sheet, the
restatement will result in a reduction of stockholders' equity,
and a corresponding increase in income tax accruals, of
approximately $32 million.

The Company expects to become current in its financial reporting
upon the filing of its third quarter 10-Q by the end of November
2005.
    
Hollinger International Inc. is a newspaper publisher whose assets
include The Chicago Sun-Times and a large number of community
newspapers in the Chicago area as well as in Canada.

                         *     *     *

As reported in the Troubled Company Reporter on August 6, 2004,
Moody's Investors Service changed the rating outlook on Hollinger
International Publishing, Inc., to positive from stable and has
withdrawn other ratings.

Ratings withdrawn:

   * $45 million Senior Secured Revolving Credit Facility, due
     2008 -- Ba2

   * $210 million Term Loan "B", due 2009 -- Ba2

   * $300 million of 9% Senior Unsecured Notes, due 2010 -- B2

Ratings confirmed:

   * Senior Implied rating -- Ba3
   * Issuer rating -- B2

Moody's says the outlook is changed to positive.


HOMESTEADS: Court Orders Conversion to Chapter 7 Liquidation
------------------------------------------------------------
The U.S. Bankruptcy Court for the District of Connecticut, New
Haven Division approved the request of Elizabeth J. Austin, the
former chapter 11 trustee of The Homesteads at Newtown, LLC, to
extend until Sept. 4, 2005, within which she must comply with the
Court's order converting the Debtor's chapter 11 case to a chapter
7 liquidation proceeding.

On July 6, 2005, Ms. Austin asked the Court to convert the case to
chapter 7 as the primary secured creditor, General Electric
Capital Corporation, took title to the assisted living facility.  
Accordingly, there were no operations to rehabilitate through a
chapter 11 proceeding.

The Court directs the former Trustee to take several actions
before Sept. 4, including but not limited to, the filing of an
accounting of all receipts and distributions made, together with a
schedule of all unpaid debts incurred after the chapter 11 filing.

Ms. Austin needs to coordinate with the Chapter 7 Trustee and Long
Hill Company, an operating manager to the assisted living
facility, to obtain the information needed to comply with the
conversion order.

Headquartered in Guilford, Connecticut, The Homesteads at Newtown,  
LLC -- http://www.homesteadsct.com/-- is a life-care community.    
The Company filed for chapter 11 protection on September 10, 2004
(Bankr. D. Conn. Case No. 04-34262).  Mark R. Jacobs, Esq., at
Jacobs Partners LLC, represent the Debtor in its restructuring
efforts.  When the Debtor filed for protection from its creditors,
it estimated more than $10 million in assets and debts.


INTELSAT LTD: Inks Pact to Buy PanAmSat for $3.2 Billion
--------------------------------------------------------
Intelsat, Ltd., and PanAmSat Holding Corporation (NYSE: PA) signed
a definitive merger agreement under which Intelsat will acquire
PanAmSat for $25 per share in cash, or $3.2 billion.  The
transaction will create a premier satellite company that will be a
leader in the digital delivery of video content, the transmission
of corporate data and the provisioning of government
communications solutions.

The new company will offer its customers expanded coverage with
additional back-up satellites, supporting fiber networks and
enhanced operational capabilities for the provision of an
unparalleled level of services.  With an increased focus on
developing advanced communications technologies, the company will
meet the needs of cable TV programmers, broadcasters, businesses,
governments and consumers worldwide.

Using a combined fleet of 53 satellites, the company will serve
customers in more than 220 countries and territories.  Driven by
the core strengths of the two companies and their employees'
commitment to quality in operations and customer service, Intelsat
will have a portfolio of customers not only in the developed
world, but also in emerging nations and remote areas where
satellites are critical to providing communications infrastructure
for economic development.

"The combination of Intelsat and PanAmSat creates an industry
leader with the ability to provide competitive communications and
video services to consumers and businesses," said David McGlade,
Chief Executive Officer of Intelsat.  "The two companies are
complementary in customer, geographic and product focus.  
Together, we will continue providing the highest level of service
to existing customers while growing new business in rapidly
expanding communications markets."

Mr. McGlade will continue to serve as Chief Executive Officer and
a Director of the company upon closing.  Joseph Wright, currently
Chief Executive Officer of PanAmSat, is expected to become
Chairman of the Board upon completion of the transaction.

"Today, PanAmSat offers its video, data and government customers a
highly reliable level of service that only a technically advanced
and financially strong satellite operator can provide," said Mr.
Wright. "Now, we will combine the best from both companies and
bring a professional business approach to the new enterprise to
benefit our customers, employees and shareholders.  This is a
'win-win' for both companies, and a terrific outcome for all of
PanAmSat's shareholders, who will receive $25 per share in cash -
a significant premium over the recent stock price and nearly a 40%
premium over the IPO price of about six months ago.  In addition,
our shareholders will continue to receive dividends, at the
current annual rate or higher, until we close the transaction."

PanAmSat brings a strong, video-centric customer base, including
leading providers of cable TV programming, while Intelsat's
historical strength has been in providing core telephony and
advanced data services to developing and underserved regions
around the world.  Over the long term, the company will
consolidate best practices from the two respective organizations.  
"We will leverage our combined intellectual, material and people
assets to continue the high-quality service Intelsat and PanAmSat
customers have come to expect," said David McGlade.

Following the transaction, the company will have enhanced
financial strength and revenue and free cash flow growth
opportunities.  The company is expected to have pro forma annual
revenues of more than $1.9 billion and to maintain significant
free cash flow from operations, providing significant resources
for capital expenditures and debt service.

Under the agreement, which was approved unanimously by the Boards
of Directors of both companies, Intelsat will acquire all
outstanding common shares of PanAmSat, and additionally Intelsat
will either refinance or assume approximately $3.2 billion in debt
of PanAmSat Holding Corporation and its subsidiaries.  
Shareholders owning approximately 58% of PanAmSat's shares have
agreed to vote in favor of the combination.

                            Financing

Intelsat has received financing commitments for the full amount of
the purchase price from a group of financial institutions led by:

   * Deutsche Bank Securities Inc.,
   * Citigroup Global Markets Inc.,
   * Credit Suisse First Boston LLC, and
   * Lehman Brothers Inc.

A substantial portion of the financing for the transaction is
expected to be raised at Intelsat (Bermuda), Ltd., with additional
financing expected to be raised at PanAmSat Holding Corporation,
PanAmSat Corporation, and Intelsat Subsidiary Holding Company,
Ltd.  Prior to this financing and the closing of the transaction,
Intelsat (Bermuda), Ltd. is expected to transfer substantially all
of its assets and liabilities (including its 9-1/4% Senior
Discount Notes due 2015) to a newly formed wholly owned
subsidiary.  Upon completion of the transaction, both PanAmSat
Holding Corporation and Intelsat Subsidiary Holding Company, Ltd
will be direct or indirect wholly owned subsidiaries of Intelsat
(Bermuda), Ltd., and PanAmSat Holding Corporation and its
subsidiaries will continue as separate corporate entities.  The
transaction is expected to result in a Change of Control, as
defined in the indenture governing PanAmSat Holding Corporation's
outstanding bonds and certain of the indentures governing PanAmSat
Corporation's outstanding bonds.

The transaction is conditioned upon PanAmSat Holding Corporation
shareholder approval, customary closing conditions and clearances
from relevant regulatory agencies, including the appropriate U.S.
government antitrust authorities and the Federal Communications
Commission. The companies anticipate that the transaction could
close in approximately six to 12 months.

                          Professionals

Credit Suisse First Boston LLC is serving as Intelsat's financial
advisor, and Wachtell, Lipton, Rosen & Katz, Paul, Weiss, Rifkind,
Wharton & Garrison LLP, and Milbank, Tweed, Hadley & McCloy LLP
are serving as Intelsat's legal advisors.  Morgan Stanley is
serving as PanAmSat's financial advisor, and Simpson Thacher &
Bartlett LLP is serving as PanAmSat's legal advisor.

                         About PanAmSat

Through its owned and operated fleet of 25 satellites, PanAmSat
Holding Corp. (NYSE: PA) -- http://www.panamsat.com/-- is a  
leading global provider of video, broadcasting and network
distribution and delivery services.  It transmits 1,991 television
channels worldwide and, as such, is the leading carrier of
standard and high-definition signals.  In total, the Company's in-
orbit fleet is capable of reaching over 98 percent of the world's
population through cable television systems, broadcast affiliates,
direct-to-home operators, Internet service providers and
telecommunications companies.  In addition, PanAmSat supports
satellite-based business networks in the U.S., as well as
specialized communications services in remote areas throughout the
world.  

                      About Intelsat, Ltd.

Intelsat, Ltd. offers telephony, corporate network, video and
Internet solutions around the globe via capacity on 25
geosynchronous satellites in prime orbital locations.  Customers
in approximately 200 countries rely on Intelsat's global
satellite, teleport and fiber network for high-quality
connections, global reach and reliability.

As reported in the Troubled Company Reporter on Mar. 7, 2005,
Fitch Ratings has maintained the ratings of Intelsat:

   Intelsat, Ltd.

       -- senior unsecured notes at 'CCC+'.

   Intelsat (Bermuda), Ltd. (formerly Zeus Special Sub Ltd.)

       -- Senior unsecured discount notes at 'B-'.

   Intelsat Subsidiary Holding Company Ltd. (formerly Intelsat
   (Bermuda), Ltd.

       -- Senior unsecured notes at 'B';
       -- Senior secured credit facilities at 'BB-'.


JORDAN INDUSTRIES: Balance Sheet Upside-Down by $250MM at June 30
-----------------------------------------------------------------
Jordan Industries, Inc., reported its financial results for the
quarter ending June 30, 2005, in a Form 10-Q delivered to the
Securities and Exchange Commission on August 15, 2005.

Net sales for continuing operations decreased $2.7 million, or
1.4%, to $188.1 million for the second quarter of 2005 from
$190.8 million last year.  Net sales for continuing operations
increased $4.4 million, or 1.2%, to $363.6 million through the
first half of 2005 from $359.2 million last year.  The increase in
sales for the second quarter was primarily due to strong growth
for Kinetek and Jordan Specialty Plastics, which grew 9.9% and
13.9%, respectively.  These increases were partially offset by a
32.0% decline in the Automotive Aftermarket segment largely
resulting from a weak climate control market due to the cooler
weather through mid summer and the discontinuation of business
with a large customer in the climate control segment.  The
improved economy helped both the Kinetek and Jordan Specialty
Plastics segments throughout the first half but most of the growth
in these segments continues to come from the introduction of the
new products and market share gains in several niche markets.  In
addition, some of the sales growth in the second quarter and first
half can be attributed to improved success with passing on raw
material inflation through increased selling price.

Operating income of continuing operations decreased $5.3 million,
or 30.8%, to $12.1 million for the second quarter of 2005 from
$17.4 million for the same period last year.  Operating income of
continuing operations decreased $8.8 million, or 30.9%, to $19.7
million through the first half of 2005 from $28.5 million for the
same period last year.  The decrease in operating income for both
the second quarter and first half was primarily due to the
Automotive Aftermarket and to a lesser extent Jordan Specialty
Plastics.  Operating income for Kinetek improved by 8.1% partially
offsetting declines in the other segments for the second quarter.   
Raw material inflation compressed product margins at Kinetek and
Jordan Specialty Plastics in the second quarter and the first
half.  Beginning in the second half of 2004, all companies began
to pass along some of these costs with greater success but to a
lesser extent than the increased cost.  Through the first half,
the Jordan Specialty Plastics segment was only able to pass along
approximately 70% of the year over year raw material inflation
through selling price increases.  In addition, the Jordan
Specialty Plastics segment recorded charges of approximately
$1.0 million in the second quarter of 2005 primarily due to
increased accruals and reserves in foreign operations.  Also
included in the operating income for Kinetek in the first half of
2005 are costs associated with product transitions and plant
rationalizations.  The decrease in operating income throughout the
first half for the Automotive Aftermarket was mostly due to lower
sales volumes of climate control products and production
inefficiencies resulting from consigned parts shortages in the
torque converter business.

                 Liquidity and Capital Resources

The Company had approximately $105.2 million of working capital at
June 30, 2005, compared to approximately $98.9 million at
December 31, 2004.

Operating Activities

Net cash used in operating activities for the six months ended
June 30, 2005, was $6.2 million compared to net cash used in
operating activities of $21.3 million during the same period in
2004.

Investing Activities

Net cash provided by investing activities for the six months ended
June 30, 2005, was $5.1 million compared to net cash provided by
investing activities of $30.5 million during the same period in
2004.  In 2005, net cash provided by investing activities
primarily includes $1 million from proceeds of a sale of
discontinued operations, $6.6 million from the sale of an
affiliate and $1.1 million in proceeds from the sale of Cho-Pat.
This is compared to $6.2 million of proceeds from the sale of
discontinued operations and $27.2 million of proceeds from the
sale of affiliates in 2004.

                     Financing Activities

Net cash provided by financing activities for the six months ended
June 30, 2005, was $2.5 million compared to net cash used in
financing activities of $4.6 million during the same period in
2004.  The increase in cash provided by financing activities is
primarily due to lower repayments of debt in 2005 and payments for
financing fees of $3.5 million in 2004.

The Company is party to two credit agreements under which the
Company is able to borrow up to $90.0 million to fund
acquisitions, provide working capital and for other general
corporate purposes.  The credit agreements mature in 2005 and
2006.  The agreements are secured by a first priority security
interest in substantially all of the Company's assets.  As of June
30, 2005, the Company had approximately $11.7 million of available
funds under these arrangements.

A full-text copy of Jordan Industries' Quarterly Report is
available for free at http://ResearchArchives.com/t/s?123

Jordan Industries, Inc., was organized to acquire and operate a
diverse group of businesses with a corporate staff providing
strategic direction and support.  The Company is currently
comprised of 21 businesses which are divided into five strategic
business units: (1) Specialty Printing and Labeling, (2) Consumer
and Industrial Products, (3) Jordan Specialty Plastics, (4)
Jordan Auto Aftermarket, and (5) Kinetek.

As of June 30, 2005, Jordan Industries' balance sheet reflected a
$250,052,000 equity deficit compared to a $242,981,000 equity
deficit at Dec. 31, 2004.


JOY GLOBAL: Earns $31 Million of Net Income in Third Quarter
------------------------------------------------------------
Joy Global Inc. (Nasdaq: JOYG) reported results for the third
quarter of fiscal year 2005.  Net sales for the quarter increased
by 37 percent to $523 million, compared with $382 million in the
third quarter of last year.  Operating income totaled $73 million
in the third quarter, versus $30 million in the corresponding
quarter last year.  

Third quarter 2005 Net income was $31 million, compared with
$16 million in the third quarter of fiscal 2004.  

"Third quarter results continued our strong operating performance
trend," said John Hanson, chairman, president and CEO of Joy
Global Inc.  "New orders exceeded $540 million in the quarter,
despite Joy Mining experiencing a $62 million decline in roof
support orders from the same quarter last year.  Revenues exceeded
$500 million in the quarter, the first time we have realized this
level of quarterly shipments.  Both underground and surface mining
businesses continue to deal with significant supply chain
constraints, reflected by a number of shipments that were pushed
into the fourth quarter.  Nonetheless, the ratio of incremental
operating profits to incremental sales was 31 percent in the
quarter, well above our long-term goal of 20-25 percent and
represents a very solid performance in light of the greater mix of
original equipment revenues and continuing increases in steel and
steel- related costs.  Conditions in our end markets continue to
point to an extended, strong global mining cycle.  We face the
challenge of increasing capacity to meet demand, while managing a
tight supply chain.  Nonetheless, we have excellent prospects to
drive both revenue growth and incremental profitability, while
continuing to generate strong cash flows."

Reported results in the third quarter were affected by non-
recurring items, including $24 million in debt repurchase costs
from the tender of outstanding senior subordinated notes.  The
effective income tax rate in the current quarter was 36 percent of
pre-tax book income, essentially equal to the rate in the
corresponding quarter last year.  Cash taxes continue to be
substantially lower than book taxes, with total cash taxes in the
third quarter of $2 million, which brings year-to-date cash taxes
to $14.5 million, or 10% of pre-tax income.  This low cash tax
rate contributed to the $6 million increase in net cash in the
quarter, which occurred despite $69 million of cash being used for
pension plan pre-funding and bond tender premium costs.

Net sales at Joy Mining were strong, up 24 percent over the same
quarter of the prior year, with both original equipment and
aftermarket revenues realizing double-digit increases.  Supply
constraints in specialty steel are easing somewhat, although
prices remain firm.  Areas of restricted supply include castings,
fabrications, bearings and other purchased components.  
Fabrication and casting constraints are expected to lessen in the
fourth quarter, and significant efforts are being made to ensure
that customers' requirements are met, particularly in aftermarket
parts and services where service levels have remained high.

Gross profit margins at Joy Mining were 32 percent in the third
quarter versus 29 percent in the third quarter of last year.  
Operating margins were 17.5 percent of sales, and incremental
operating profitability was 44 percent for the quarter.  The very
high level of incremental profitability, despite the heavier
original equipment product mix, resulted from favorable margins on
certain product lines, strong absorption of manufacturing expenses
and excellent cost controls.  Joy Mining successfully recovered
its steel and steel-related cost increases in the quarter.
Incremental profitability in the upcoming fourth quarter is
expected to moderate to a range of 20-25 percent, largely due to
product mix.

                     Cash and Liquidity

During the third quarter the company completed the repurchase of
the remaining $167 million of the outstanding senior subordinated
notes.  The total cost, including the tender premium, was
$188 million.  Including the write-off of unamortized original
placement costs, a pre-tax charge of $24 million was recorded in
the quarter.

In July, the company made a pre-payment to its domestic defined
benefit plans in the amount of $48 million.  This payment resulted
in the company's domestic plans being in excess of 90 percent
funded for ERISA purposes for the second consecutive year and, as
a result, these plans require no further funding over the
following two plan years under current ERISA legislation.  The
company notes that interest rate increases during the next two
years could make further cash contributions unnecessary for
several years.  This outcome could change if various pension
proposals currently under discussion in Congress are adopted.

Working capital management continues to be a challenge due to
strong business conditions.  Significant initiatives are being
implemented in the areas of inventory, accounts receivable and
advance payments to optimize net working capital investment.  
Solid advancement on these initiatives was achieved during the
quarter, and as a result, account receivable days outstanding
decreased, inventory turns increased and non-cash working capital
levels were essentially unchanged from the end of the second
quarter.  Capital spending in the quarter was approximately
$10 million.  The company anticipates total capital spending for
the current fiscal year to range between $35 million and
$40 million.

The strong performance in the management of working capital
allowed the company's net cash position to improve during the
quarter despite the large pension deposit and premiums paid in
repurchasing the senior subordinated notes.  Cash balances of
$70 million at the end of the third quarter primarily represented
cash in the company's international operations, and net cash was
$42 million at quarter's end.

The company did not repurchase any stock during the quarter under
the recently announced buyback program.  Outstanding shares of the
company may be repurchased from time to time over the next 21
months.  Cash generated from operations or additional borrowings
under debt facilities, including the anticipated new senior
revolving facility, will provide funds for this program.

Joy Global Inc. is a worldwide leader in manufacturing, servicing  
and distributing equipment for surface mining through its P&H  
Mining Equipment division and underground mining through its Joy  
Mining Machinery division.

                        *     *     *

Standard & Poor's Rating Services placed its BB- rating on Joy
Global's 8-3/4% notes due 2012 on Feb. 10, 2005, with a positive
outlook at that time.  


JP MORGAN: Fitch Affirms Low-B Rating on Five Certificate Classes
-----------------------------------------------------------------
Fitch Ratings upgrades JP Morgan Chase Commercial Mortgage
Securities Corporation's commercial mortgage pass-through
certificates, series 2002-CIBC5:

     -- $36.4 million class B to 'AAA' from 'AA';
     -- $13.8 million class C to 'AA+' from 'AA-';
     -- $27.6 million class D to 'AA' from 'A';
     -- $13.8 million class E to 'AA-' from 'A-';
     -- $28.9 million class F to 'A-' from 'BBB';
     -- $16.3 million class G to 'BBB+' from 'BBB-';
     -- $18.8 million class H to 'BBB-' from 'BB+'.

Fitch also affirms these classes:

     -- $272.9 million class A-1 'AAA';
     -- $487.2 million class A-2 'AAA';
     -- Interest-only classes X-1 and X-2 'AAA';
     -- $12.6 million class J 'BB';
     -- $5.0 million class K 'BB-';
     -- $5.0 million class L 'B+';
     -- $8.8 million class M 'B';
     -- $2.5 million class N 'B-'.

Fitch does not rate the $17.3 million class NR.

The rating upgrades reflect the improved credit enhancement levels
from scheduled amortization and defeasance.  As of the August 2005
distribution date, the pool has paid down 3.7% to $966.9 million
from $1.0 billion at issuance. Four loans (2.7%) have defeased.

One asset (0.75%), secured by a multifamily property in Winston-
Salem, NC, is currently real estate owned.  A new appraisal has
been ordered and the special servicer is planning to market the
property shortly.

Fitch reviewed the two credit assessed loans in the pool, the
Simon Mall Portfolio (10.5%) and the Avion Portfolio (4.7%).  Both
loans maintain investment grade credit assessments.  The debt
service coverage ratio for each loan is calculated using servicer
provided net cash flow adjusted for vacancy, management, and
required reserves divided by debt service payments based on the
current loan balance using a Fitch stressed refinance constant.

The Simon Mall Portfolio is secured by a total of 1.5 million
square feet in four regional malls located in Ohio, Texas,
Indiana, and Wisconsin.  The subject loan consists of an A note
with a total outstanding principal balance as of August 2005 of
$103.5 million and a B note with a current outstanding principal
balance of $17.2 million.  The A-note year-end 2004 DSCR is 1.60
times (x) compared to 1.45x at issuance.  The portfolio's in-line
occupancy has declined to 86.8% as of June 30, 2005 compared to
92.4% at issuance.

The Avion Portfolio is secured by seven suburban office and flex
buildings in Chantilly, VA, with a total of 586,466 sf.  The YE
2004 DSCR has increased to 1.71x from 1.41x at issuance.  As of
Dec. 31, 2004, the portfolio's occupancy improved to 93.6% from
89% at issuance.


KAISER ALUMINUM: Exclusive Periods Extended Until September 30
--------------------------------------------------------------
The Hon. Judith Fitzgerald of the U.S. Bankruptcy Court for the
District of Delaware extended Kaiser Aluminum Corporation and its
debtor-affiliates, including Alpart Jamaica, Inc., Kaiser Jamaica
Corporation, Kaiser Alumina Australia Corporation, and Kaiser
Finance Corporation -- the Liquidating Debtors' period within
which they have the exclusive right to file a plan or plans until
Sept. 30, 2005.  The Court also extended their exclusive
solicitation period until Nov. 30, 2005.

Headquartered in Foothill Ranch, California, Kaiser Aluminum
Corporation -- http://www.kaiseraluminum.com/-- is a leading  
producer of fabricated aluminum products for aerospace and high-
strength, general engineering, automotive, and custom industrial
applications.  The Company filed for chapter 11 protection on
February 12, 2002 (Bankr. Del. Case No. 02-10429), and has sold
off a number of its commodity businesses during course of its
cases.  Corinne Ball, Esq., at Jones Day, represents the Debtors
in their restructuring efforts.  On June 30, 2004, the Debtors
listed $1.619 billion in assets and $3.396 billion in debts.
(Kaiser Bankruptcy News, Issue No. 76; Bankruptcy Creditors'
Service, Inc., 215/945-7000)


KB TOYS: Emerges From Bankruptcy Protection
-------------------------------------------
KB Toys, Inc.'s First Amended Joint Plan of Reorganization took
effect, which allowed the Debtor to emerge from bankruptcy
protection under Chapter 11 of the U.S. Bankruptcy Code.  KB Toys
operates its 640 toy stores in malls, strip centers and outlets
across the country.

The U.S. Bankruptcy Court for the District of Delaware confirmed
the Debtor's chapter 11 plan on Aug. 18, 2005.

The Plan, which is proposed jointly by the Company and its
statutory Official Committee of Unsecured Creditors, is based on a
Plan Funding Agreement between the Company and PKBT Funding LLC,
an affiliate of Prentice Capital Management, LP.  Pursuant to the
Agreement, PKBT will invest $20 million in a reorganized KB Toys
and provide a seasonal over-advance credit facility of up to
$25 million in exchange for 90% of the common stock and 100% of
the preferred stock of the reorganized Company.  The remaining
common stock will be held by a trust for the benefit of the
unsecured creditors of those KB Toys entities being reorganized
under the Plan of Reorganization.

                        New Officers

KB Toys' new majority owner, PKBT Funding, named Gregory R.
Staley, former President of Toys 'R' Us' USA and International
divisions, KB Toys' new President and Chief Executive Officer.  
Roger V. Goddu, formerly Chairman and Chief Executive Officer of
Montgomery Ward, and also a former President of Toys 'R' Us USA,
is a director of, and consultant to, KB Toys.  Messrs. Goddu and
Staley, both respected toy industry executives, bring a wealth of
industry knowledge and experience to KB Toys.

Mr. Staley, who has extensive retail experience and a reputation
for achieving successful results, stated: "I am thrilled to be
joining KB Toys.  Our loyal and dedicated associates are committed
to growing our business and serving our customers.  Together, we
will continue to strive to deliver a fun and friendly shopping
experience with quality merchandise at affordable prices."

"In addition to acknowledging the commitment and hard work of the
KB Toys associates, I would like to also thank our business
partners -- our suppliers, landlords and lenders," Mr. Staley
continued.  "Without their assistance and support, KB Toys would
not have the opportunity to once again become a vibrant and
successful retailer."

PKBT Funding LLC, an affiliate of Prentice Capital Management, LP,
a private-equity firm specializing in strategic investments in the
consumer and retail sectors, is committed to making KB Toys a
success story.  "KB Toys offers a terrific opportunity -- it has a
dedicated group of employees, a solid lease portfolio and great
relationships with its vendors," Jonathan Duskin, a managing
director of Prentice Capital, and a director of KB Toys, said.  
"We are excited about the strategic and operating expertise that
Greg Staley and Roger Goddu bring to the company.  Greg and Roger
are experienced toy retailers, who will provide the new KB Toys
with great vision and leadership."

One of the largest toy retailers in the United States, KB Toys
-- http://www.kbtoys.com/-- (which once boasted 1,200 stores)    
operates about 650 stores under four formats:

            * KB Toys mall stores,
            * KB Toy Works neighborhood stores,
            * KB Toy Outlets and KB Toy Liquidator, and
            * KB Toy Express (in malls during the holiday season).

The company along with its affiliates filed for chapter 11
protection on January 14, 2004 (Bankr. Del. Case No. 04-10120).
The chapter 11 filing resulted in nearly 600 store closures and
4,000 layoffs.  In March 2004, KB Toys sold its KBToys.com
Internet business to an affiliate of D. E. Shaw, which renamed the
company eToys Direct.  Joel A. Waite, Esq., at Young, Conaway,
Stargatt, & Taylor, represents the toy retailer.  When the Debtors
filed for protection from its creditors, they listed consolidated
assets of $507 million and consolidated debts of $461 million.


KMART CORP: Court Denies Boorman's Motion to File Late Claim
------------------------------------------------------------
As reported in the Troubled Company Reporter on July 15, 2005,
Randall A. Boorman sustained injuries at a Big Kmart Store, No.
4343, in West Palm Beach, Florida, on September 13, 2002.

Mr. Boorman asked Judge Sonderby for an extension of time to file
proof of its unsecured administrative expense claim and deem that
claim timely filed.

Beth Anne Alcantar, Esq., at Johnson & Associates, in Chicago,
Illinois, contends that the excusable neglect standard for a
request under Bankruptcy Rule 2006 has been met because Kmart did
not provide Findler with the Bar Date Notice despite the fact that
it knew Findler was representing Mr. Boorman.

Mr. Boorman also asked the Court to modify the injunction mandated
by Section 1141 of the Bankruptcy Code so he may proceed with the
State Court Litigation to liquidate his claim so the amount may
then be paid in accordance with Kmart's Plan of Reorganization.

*    *    *

The Court denied Mr. Boorman's request.

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


LEXAM EXPLORATION: June 30 Equity Deficit Widens to C$507,915
-------------------------------------------------------------
Lexam Explorations Inc. (NEX:LEX.H) recorded a loss of $43,620
during the three months ended June 30, 2005, compared to a loss of
$48,322 during the corresponding period in 2004.  During the six
months ended June 30, 2005, Lexam recorded a loss of $64,313
compared to a loss of $71,593 during the first half of 2004.  The
loss during the second quarter and first half of 2005 can be
attributed to expenditures for administrative costs of $43,638 and
$63,361 for those periods, reduced from $47,879 and $71,979 during
the same periods in 2004 respectively.

                       Financial Condition

Lexam is currently not able to continue its exploration efforts
and discharge its liabilities in the normal course of business,
and may not be able to ultimately realize the carrying value of
its assets, subject to, among other things, being able to raise
sufficient additional financing to fund its exploration programs
including the review and evaluation of the technical data received
from Petro-Hunt relating to the Baca Oil & Gas property.  The
Company is evaluating alternatives to address these issues,
including joint venturing certain properties and seeking
additional sources of debt or equity.

On February 18, 2005, the Company's listing on the TSX Venture
Exchange was transferred to the NEX board of the TSX-V due
primarily to the Company's lack of sufficient operating capital.
The NEX board allows Lexam's shares to continue trading while it
seeks alternative financing or other joint venture partners to
resume exploration activities.  Without such alternative funds or
joint venture partners, Lexam is not expected to be able to
conduct any exploration or development work.

Headquartered in Canada, Lexam Explorations Inc., provides oil &
gas field exploration services.

As of June 30, 2005, Lexam Explorations' equity deficit widened to
C$507,915 from a C$443,602 deficit at Dec. 31, 2004.


LEXAM EXPLORATION: Goldcorp Sells Equity Stake to CEO R. McEwen
---------------------------------------------------------------
Lexam Explorations Inc. (NEX:LEX.H) reported that Goldcorp Inc.
will be selling its 49.8% interest (18,990,641 shares) in Lexam to
a company wholly owned by Robert R. McEwen, the Chairman and CEO
of the Company and the Chairman of Goldcorp for aggregate total
consideration of $400,000.  As part of the sale, Lexam's debt owed
to Goldcorp of $402,720 will be extinguished.  The transaction is
expected to be completed on September 1, 2005.

Headquartered in Canada, Lexam Explorations Inc., provides oil &
gas field exploration services.

As of June 30, 2005, Lexam Explorations' equity deficit widened to
CDN$507,915 from a CDN$443,602 deficit at Dec. 31, 2004.


MACH ONE: Fitch Retains Low-B Rating on Six Certificate Classes
---------------------------------------------------------------
MACH ONE 2004-1, LLC, series 2004-1, commercial mortgage-backed
securities pass-through certificates are affirmed by Fitch:

     -- $96.4 million class A-1 at 'AAA';
     -- $152.0 million class A-2 at 'AAA';
     -- $146.8 million class A-3 at 'AAA';
     -- Notional class X at 'AAA';
     -- $51.5 million class B at 'AA';
     -- $10.5 million class C at 'AA-';
     -- $28.1 million class D at 'A';
     -- $7.2 million class E at 'A-';
     -- $17.7 million class F at 'BBB+';
     -- $15.3 million class G at 'BBB';
     -- $14.5 million class H at 'BBB-';
     -- $17.7 million class J at 'BB+';
     -- $8.8 million class K at 'BB';
     -- $8.0 million class L at 'BB-';
     -- $8.8 million class M at 'B+';
     -- $6.4 million class N at 'B';
     -- $6.4 million class O at 'B-'.

Fitch does not rate classes P-1 through P-6.

The rating affirmations are the result of stable performance of
the underlying collateral and limited paydown to this transaction.  
As of the July 2005 distribution date, the transaction has paid
down 0.6% to $639.7 million from $643.3 million at issuance.

The certificates are collateralized by all or a portion of 60
classes of fixed-rate commercial mortgage-backed securities.  The
current weighted average rating factor of the underlying bonds is
11.17, corresponding to an average rating of 'BB+/BB', stable from
issuance.  The classes' ratings are based on Fitch's actual
rating, or on Fitch's internal credit assessment for those classes
not rated by Fitch.

Delinquencies in the underlying transaction are as follows: 30
days: 0.3%; 60 days: 0.04%; 90 plus days: 0.8%; foreclosure: 0.3%;
and real estate owned: 0.7%.


MADISON SQUARE: Recent Paydown Prompts Fitch to Raise Ratings
-------------------------------------------------------------
Fitch upgrades 11 classes of Madison Square 2004-1 Ltd. and
Madison Square 2004-1 Corp. Commercial Mortgage-Backed Notes,
Series 2004-1:

     -- $13.6 million class B to 'AAA' from 'AA+';
     -- $34.3 million class C to 'AAA' from 'AA';
     -- $21.1 million class D to 'AAA' from 'AA-';
     -- $21.1 million class E to 'AAA' from 'A+';
     -- $21.1 million class F to 'AAA' from 'A';
     -- $21.1 million class G to 'AAA' from 'A-';
     -- $31.7 million class H to 'AAA' from 'BBB+';
     -- $23.7 million class J to 'AAA' from 'BBB';
     -- $70.8 million class K to 'AA' from 'BBB-';
     -- $122.7 million class L to 'A-' from 'BBB-';
     -- $18.5 million class M to 'BBB-' from 'BB+';
     -- $29.0 million class N to 'BB+' from 'BB';
     -- $29.1 million class O to 'BB' from 'BB-';
     -- $22.4 million class P to 'BB-' from 'B+';
     -- $11.9 million class Q to 'B+' from 'B';
     -- $9.2 million class S to 'B' from 'B-'.

Fitch does not rate class IO or T and class A has paid in full.

The upgrades are the result of paydown and subsequent increased
credit enhancement.  As of the July 2005 distribution date, the
transaction has paid down 22.8%, to $815.4 million from $1.1
billion at issuance.

The certificates are collateralized by all or a portion of 34
classes of fixed-rate commercial mortgage backed securities in
eight transactions, and two classes of floating-rate CMBS
transactions in two transactions.  The weighted average rating
factor of the underlying bonds is 30.38, corresponding to an
average rating of 'B/B-', a slight improvement since issuance.  
The classes' ratings are based on Fitch's actual rating, or on
Fitch's internal credit assessment for those classes not rated by
Fitch.  Fitch rates 99% of the underlying deals contributed.

Additional credit enhancement is provided by ongoing interest
shortfall reserves and the paydown of additional principal with
interest collections otherwise paid to classes P through T.

Delinquencies in the underlying transaction are as follows: 30
days: 0.1%; 60 days: 0.02%; 90-plus days: 0.6%; foreclosure: 0.3%;
and real estate owned: 2.2%.  While Fitch is concerned with the
high percent of REO loans, the transaction's non-rated class is
expected to absorb anticipated losses.


MARKLAND TECH: Releases Unaudited Fiscal 2005 Financial Results
---------------------------------------------------------------
Markland Technologies, Inc. (OTCBB:MRKL), a defense and homeland
security company transforming advanced laboratory technology into
real-world products, reported its un-audited results for the
company's fiscal year ending June 30, 2005.

Un-audited revenues for the year were $66,728,041 a significant
increase over revenues for the corresponding period in 2004 of
$6,013,930.  Un-audited revenues for the fourth quarter were
$20,703,255.  This significant increase in year over year revenues
is due almost entirely to the acquisition of EOIR Technologies
Inc.

The un-audited operating loss for the year amounted to $17,023,208
compared to $10,150,866 for the prior year.  This loss was
affected by non-cash charges for the compensatory element of stock
issuances and amortization of intangible assets and in process R &
D resulting from our recent acquisitions.  These non-cash charges
amounted to $10,798,045. The un-audited net loss attributable to
common shareholders after minority interests for the year ended
June 30, 2005 was $29,049,471, compared to a loss of $15,095,461
in the corresponding period in 2004.  This decrease in the loss
per share is due to an increase in the weighted average number of
shares outstanding to 75,721,755 from 10,872,049 for the period
ending June 30, 2005.  The non-cash charges included in the un-
audited net loss attributable to common shareholders after
minority interests for the year ended June 30, 2005, amounted to
$22,077,214 compared with $10,962,184 for the corresponding period
in 2004.

"The company finished the fiscal year in a very strong financial
position with a funded backlog of over $54M and a cash balance of
approximately $8M," said Robert Tarini, Chairman and CEO of
Markland Technologies Inc.  "Our fiscal fourth quarter revenues
were at a record high and we are achieving desired operational and
product development synergies from our recent acquisition of Genex
Technologies with those of EOIR Technologies.  We have a skilled
and dedicated work force with a significant base of proprietary
cutting edge technology.  We have a loyal and growing government
customer base and we believe that we are well positioned to grow
revenues in the present fiscal year.  Given the current worldwide
level of terrorist activity, and the challenges still facing our
combat troops we are proud to be able to help develop the
innovative solutions necessary to help solve these worldwide
problems."

Investors are cautioned that these results are un-audited figures.  
Final audited figures will be made available in the company's
annual report on Form 10-K when filed.

Markland Technologies, Inc. -- http://www.marklandtech.com/-- is  
committed to setting next-generation standards in defense and
security through the provision of innovative emerging technologies
and expert services.  The Company is engaged in the identification
of advanced technologies currently under development in
laboratories, universities and in private industry, and in the
transformation of those technologies into next-generation
products.  Markland's solutions support military, law enforcement
and homeland security personnel to protect the nation's citizens,
borders and critical infrastructure assets from the threat of
terrorism and other dangers.  Through strategic development,
Markland focuses on the creation of dual-use technology and
products with applications in both the defense market and civilian
homeland security and law enforcement fields.  The Company is a
Board Member of the Homeland Security Industries Association, and
is a featured Company on HomelandDefenseStocks.com  

                          *     *     *  

                       Going Concern Doubt  

In its Form 10-Q for the quarterly period ended March 31, 2005,  
filed with the Securities and Exchange Commission, Markland  
reported net losses of $20,954,843 for the nine months ended  
March 31, 2005, and $6,243,618 for the same period in 2004.   

Markland has limited finances and may require additional funding  
in order to market and license its products.  During the nine  
months ended March 31, 2005, Markland issued secured convertible  
promissory notes with a face value of $6,955,000 which, if not  
converted, are repayable between September and November 2005.   

"There is no assurance that Markland can reverse its operating  
losses, or that it can raise additional capital to allow it to  
continue its planned operations," the Company said in its  
quarterly filing.   

"These factors raise substantial doubt about Markland's ability to  
continue as a going concern," the Company added, echoing doubts  
expressed by WOLF & COMPANY, P.C., in Boston, Massachusetts, when
it audited Markland's financial statements for the fiscal year
ending June 30, 2004.  Auditors at MARCUM & KLIEGMAN LLP had
similar doubts when they looked at Markland's 2003 financial
statements.


MCDERMOTT INT'L: To Pay $350 Million to B&W's Asbestos PI Trust
---------------------------------------------------------------
McDermott International, Inc. (NYSE:MDR) and its affiliates,
together with the Asbestos Claimants' Committee and the Legal
Representative for Future Asbestos-Related Claimants, agreed upon
the terms of a revised settlement agreement in the Chapter 11
bankruptcy proceedings involving The Babcock & Wilcox Company and
certain of its subsidiaries.  The Proposed Settlement Agreement
will modify the existing plan and proposed settlement agreement
currently before the District Court and recorded in McDermott's
financial statements.

Key terms and aspects of the proposed Settlement Agreement
include:

   -- McDermott will retain full ownership of B&W and its
      subsidiaries following the effective date;

   -- the new plan of reorganization reflecting the Proposed
      Settlement Agreement must reach a final, non-appealable
      effective date no later than Feb. 22, 2006.  If the new plan
      of reorganization proposed herein is not effective by that
      date, and is not extended by the Company, the ACC and the
      FCR, the parties will return to the existing plan of
      reorganization now pending approval in the District Court,
      as currently recorded in McDermott's financial statements;

   -- on the effective date, the Company will pay the Asbestos PI
      Trust $350 million and will also assign the Asbestos PI
      Trust all insurance rights which were to be assigned under
      the previous proposed agreement;

   -- also on the effective date, B&W will issue a contingent
      promissory note in the principal amount of $250 million, and
      the Company will provide a contingent payment right in the
      amount of $355 million, both of which will be subject to the
      condition precedent that the Fairness in Asbestos Injury
      Resolution Act of 2005 (Senate Bill 852), or other
      legislation similar thereto, has not been enacted and made
      law on or before Nov. 30, 2006.  If the Fair Act is not made
      law on or before the Trigger Date, the Company will be
      required to satisfy the contingent payment right and the
      contingent promissory note;

   -- if the Fair Act has been enacted and made law on or prior to
      the Trigger Date, and is not subject to a constitutional
      challenge or other challenge to its validity by Jan. 31,
      2007, the contingent payment right will not vest and the
      note will be fully cancelled, null and void, except as to a
      payment by the Company of $25 million, due to the condition
      precedent not having been satisfied;

   -- if as of the Trigger Date the Fair Act has been enacted and
      made law but is subject to legal challenge, payments under
      the promissory note and contingent payment right will be
      suspended until the legal challenge to the legislation is
      resolved by final non-appealable judgment;

   -- the $250 million contingent promissory note, subject to the
      condition precedent, shall be secured by 100% of the B&W
      shares, and guaranteed by McDermott and Babcock & Wilcox
      Investment Company. If the condition precedent is met, the
      promissory note will bear annual interest at the rate of 7%
      from the Trigger Date, with a five-year term and level
      annual principal payments commencing December 1, 2007;

   -- the $355 million contingent payment right, subject to the
      condition precedent, shall be payable within 180 days after
      the Trigger Date, will accrue interest at 7% per annum from
      the Trigger Date and will be secured by the B&W shares,
      until the payment is funded;

   -- the Company expects that the initial funding at the
      effective date of $350 million and payment of the contingent
      payment right, if necessary, will be funded through
      available cash (including cash available at B&W), the sale
      of Company shares, the issuance of debt or use of available
      credit facilities;

   -- all payments, whether of principal or interest, made by
      McDermott or B&W under the Proposed Settlement Agreement and
      related documents are anticipated to be fully tax deductible
      for purposes of the consolidated U.S. Tax Return filed by
      McDermott Incorporated;

   -- in exchange for the above payments and assignments, B&W will
      receive a full release from any and all B&W-related asbestos
      claims, with those claims being channeled to the Asbestos PI
      Trust.  All non-debtor McDermott companies will receive a
      release and protection from all asbestos claims derivative
      from B&W's use of asbestos through Section 524(g) of the
      Bankruptcy Code; and

   -- if the Proposed Settlement Agreement becomes effective by
      Feb. 22, 2006, or any mutually agreed extended date, the
      existing settlement arrangement will be modified, and
      McDermott will not be required to issue the 4.75 million
      shares of Company stock or the $92 million note contemplated
      thereby.

The Proposed Settlement Agreement is subject to many conditions
and events including but not limited to the parties negotiating
and entering into acceptable definitive agreements, any approvals
required by applicable bankruptcy law, Company Board and
shareholder approval, resolution of all objections to the Proposed
Settlement Agreement and Court approval.

McDermott provided a chart to compare the existing settlement
arrangements, the current draft of the Fair Act and the Proposed
Settlement Agreement (both with and without passage of the Fair
Act by the Trigger Date):

                       McDERMOTT INTERNATIONAL, INC.
  
                     INDICATIVE COMPARISON OF VARIOUS
                  B&W BANKRUPTCY RESOLUTION ALTERNATIVES
  
  Consideration       Existing     FAIR Act     Proposed     Proposed
   paid, Benefits     Settlement     only,      Settlement   Settlement
   received &                       with no      Agmt, no    Agmt, with
   Liabilities                     Settlement   FAIR Act by  FAIR Act by
   retained                                      11/30/06     11/30/06
  ----------------------------------------------------------------------
  B&W business/stock  Surrendered    Retained     Retained     Retained
  ----------------------------------------------------------------------
  B&W cash, assets &  Surrendered    Retained     Retained     Retained
   liabilities (1)
  ----------------------------------------------------------------------
  Insurance rights    Surrendered   Partially   Surrendered  Surrendered
                                   Surrendered
  ----------------------------------------------------------------------
  Gross amount of        $0       $700 million     $0           $0
   estimated Fair
   Act payments  (2)
  ----------------------------------------------------------------------
  Net present value      $0       $335 million     $0           $0
   of est. Fair Act                   (NPV)
   payments (7%
   discount rate)
   (2)
  ----------------------------------------------------------------------
  Initial cash                                 $350 million $350 million
   payment               $0           $0
  ----------------------------------------------------------------------
  Note / contingent   $92 million      $0       $250 million $25 million
   note issued
  ----------------------------------------------------------------------
  Stock issued /      (greater         $0       $355 million     $0
   contingent          than)
   payment            $90 million
  ----------------------------------------------------------------------
  Estimated gross    $64 million  $236 million $334 million $131 million
   tax benefits from
   consideration
   paid (at 35%)
  ----------------------------------------------------------------------
  Future B&W             None     Contingent       None         None
   asbestos                            on
   liability                       viability
                                   of national
                                      trust
  ----------------------------------------------------------------------
  Expected Date of    Uncertain    Uncertain    By 2/22/06  By 2/22/06;
   Consummation                                               FAIR Act
                                                              Uncertain
  ----------------------------------------------------------------------
  
      (1) B&W available cash as of August 24, 2005 was $352 million
      (2) Estimated based upon current draft legislation of Fair Act

"This is a watershed event for McDermott, its stockholders,
employees and other stakeholders," said Bruce W. Wilkinson,
Chairman of the Board and Chief Executive Officer.  "This
agreement will ensure that B&W will remain part of McDermott's
future, thereby providing continuity and stability for B&W
employees and retirees, as well as reassurance to all its
customers who entrust it with large, multi-year capital projects.  
It should help expedite the resolution of the bankruptcy process,
which has lasted over 5-1/2 years, and enable compensation to
finally flow to claimants who have suffered the impact of
asbestos-related diseases.  The agreement will provide a time
frame and a mechanism so that if the current national asbestos
legislation is signed into law within the specified time period,
this Proposed Settlement Agreement will result in similar
economics as if that legislation had passed without the agreement.  
Much hard work by numerous parties has brought us to where we are
today.  I wish to personally thank them for their efforts that
have resulted in this Proposed Settlement Agreement.  Further
detailed documentation and hard work remains ahead to finalize
this effort in order to implement everything contemplated on the
agreed schedule.  We will do everything in our power to assure a
successful and timely conclusion."

Incorporated in 1881, The Babcock & Wilcox Company has been
supplying innovative solutions to the world's growing energy needs
for well over a century.  B&W, known for its utility boilers and
environmental services, was acquired by McDermott in 1978,
creating a diversified energy services company.  In February 2000,
B&W and certain subsidiaries filed for Chapter 11 bankruptcy
protection as a result of mounting asbestos-related claims.  Since
February 2000, B&W has continued to be managed by McDermott;
however its results of operations have been deconsolidated from
McDermott's financial statements.  The Company wrote off its
remaining investment in B&W of $224.7 million during the second
quarter of 2002.

For the year ended December 31, 2004, on a deconsolidated basis,
B&W generated operating income of $115.6 million on revenues of
$1.37 billion.  B&W's net income for the year-ended December 31,
2004, was $99.1 million, including the result of favorable tax
valuation allowance adjustment of $26.2 million.  Beginning in
2005, McDermott spun off the pension plan assets and liabilities
associated with B&W's portion of McDermott Incorporated's pension
plan, creating a B&W-sponsored pension plan.  As a result of the
creation of a B&W-sponsored pension plan, beginning in 2005
expenses associated with this plan are accounted for on B&W's
financials.  In 2004, McDermott recorded approximately $38 million
in pension expense associated with B&W pension on McDermott's
income statement.  At August 24, 2005, B&W had unrestricted cash &
cash equivalents of $352 million.

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

At June 30, 2005, McDermott International, Inc.'s balance sheet  
showed a $139,954,000 stockholders' deficit, compared to a  
$261,443,000 deficit at Dec. 31, 2004.


MCLEODUSA INC: Cuts 240 Jobs as Part of Restructuring Plans
-----------------------------------------------------------
McLeodUSA Incorporated implemented a 12% workforce reduction
yesterday, Aug. 30, 2005, in connection with its previously
announced restructuring plans.

The reduction involves approximately 240 employees out of the
Company's approximately 1,970 person workforce across its 25-state
footprint.  The Company expects to record a charge of
approximately $3.2 million to account for severance payments
associated with this action.

As reported in the Troubled Company Reporter on Aug. 17, 2005,
Chris Davis, the Company's Chairman and Chief Executive Officer,
resigned as McLeosUSA's CEO effective Aug. 12, 2005.

Ms. Davis will remain as Chairman of the Board of Directors.  Also
effective on Aug. 12, Ken Burckhardt resigned from his positions
as Executive Vice President and Chief Financial Officer, and a
Director of the Company.

The Company has appointed Stan Springel of Alvarez & Marsal as
Chief Restructuring Officer.  Alvarez & Marsal is a well-known
firm that provides management and consulting services for
companies going through a restructuring process.  Joe Ceryanec,
Group Vice President -- Controller and Treasurer of the Company
has been appointed as the acting Chief Financial Officer.

                   Forbearance Agreement

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 for 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 Sept. 9, 2005.  
Under the forbearance agreement, the lenders have agreed not to
take any action as a result of non-payment by the Company of
certain scheduled principal amortization and interest payments
that are due on or before Sept. 9, 2005.

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.

Headquartered in Cedar Rapids, Iowa, McLeodUSA Incorporated --
http://www.mcleodusa.com/-- provides integrated communications  
services, including local services, in 25 Midwest, Southwest,
Northwest and Rocky Mountain states.  The Company filed for
chapter 11 protection on Jan. 30,2002 (Bankr. D. Del. Case No. 02-
10288).  Eric M. Davis, Esq., and Matthew P. Ward, Esq., at
Skadden, Arps, Slate, Meagher & Flom LLP represent the Debtor.  
When the Debtor filed for chapter 11 protection, it listed total
assets of $4,792,600,000 and total debts of $4,566,200,000.  The
Court confirmed the Debtor's chapter 11 plan on April 5, 2003, and
the Plan took effect on April 16, 2002.  The Court formally closed
the case on May 20, 2005.

At June 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.


MEDICAL TECHNOLOGY: Two Patent Owners Want Ch. 11 Case Dismissed
----------------------------------------------------------------
Generation II Orthotics, Inc., and Generation II USA, Inc., ask
the Honorable Russell F. Nelms of the U.S. Bankruptcy Court for
the Northern District of Texas, Fort Worth Division, to dismiss
Medical Technology, Inc., dba Bledsoe Brace Systems' chapter 11
case under Section 1112(b) of the U.S. Bankruptcy Code.

Generation II and Bledsoe were parties to a patent infringement
lawsuit in the U.S. District Court for the Western District of
Washington, Seattle Division, with the Honorable John Coughenour
presiding, Case No. C95-1842C, styled Generation II Orthotics,
Inc., and Generation II USA, Inc. v. Medical Technology, Inc., dba
Bledsoe Brace Systems.

The jury found that Bledsoe had willfully infringed Generation
II's patents concerning some medical devices and awarded damages
for $3,386,145 on Apr. 5, 2005.

On July 15, 2005, the Seattle District Court ordered that the
parties submit a revised final judgment.  The parties reached an
oral agreement for:

   -- a $3,386,145 damages award;
   -- a $1,561,615 prejudgment interest award;
   -- a $60,797.48 award of costs; and
   -- a $1,831,313.39 updated attorneys' fees.

Before the agreement could be submitted to the Court, the Debtor
filed for bankruptcy protection.

Jesse R. Pierce, Esq., at Howrey LLP in Houston, Texas, tells the
Court that cause exists to dismiss the Debtor's bankruptcy case.  
It was filed in bad faith because the President and Chairman of
the Debtor's Board of Directors said:

   -- Bledsoe's case was filed to circumvent the posting of a
      supersedeas bond during the pendency of its appeal of the
      adverse judgment in the Patent Litigation;

   -- without the adverse judgment, reorganization is not
      necessary and not contemplated; and

   -- the Debtor's business continues to expand and remains
      profitable.

Objections to the Generation II's request, if any, must be
submitted on or before 5:00 p.m. on Sept. 8, 2005, to the Clerk of
the Bankruptcy Court, located at Eldon B. Mahon U.S. Courthouse,
501 West 10th Street, in Fort Worth, Texas.

Judge Nelms will convene a hearing at 2:00 p.m. on Sept. 15, 2005,
to consider the Generation II's request.

Jesse R. Pierce, Esq., Jessica P. Wannemacher, Esq., David L.
Bilsker, Esq., and Duane Mathiowetz, Esq., at Howrey LLP represent
the Movants.

Headquartered in Grand Prairie, Texas, Medical Technology, Inc.,
dba Bledsoe Brace Systems -- http://www.bledsoebrace.com/home.asp    
-- manufactures and distributes orthopedic knee braces, ankle
braces, ankle supports, knee immobilizers, arm braces, sport
braces, boots, and walkers.  The Debtor filed chapter 11
protection on July 25, 2005 (Bankr. N.D. Tex. Case No. 05-47377).  
J. Robert Forshey, Esq., Jeff P. Prostok, Esq., and Julie C.
McGrath, Esq., at Forshey & Prostok, LLP, represent the Debtor in
its restructuring efforts.  When the Debtor filed filed for
protection from its creditors, it estimated assets and debts
between $10 million to $50 million.


MEDICAL TECHNOLOGY: Wants Appraisal Services as Appraiser
---------------------------------------------------------
Medical Technology, Inc., dba Bledsoe Brace Systems asks the
Honorable Russell F. Nelms of the U.S. Bankruptcy Court for the
Northern District of Texas, Fort Worth Division, for permission to
employ Appraisal Services, Inc., as its real estate appraiser.

The Debtor owns its headquarters facility at 2601 Pinewood Drive,
Grand Prairie, in Tarrant County, Texas.  The Debtor wants the
Firm to appraise the Debtor's Property to determine the total
value of its assets.  The valuation is needed in the negotiation
of the use of cash collateral and DIP financing.

Appraisal Services will charge:

   -- $2,500 for a summary appraisal;

   -- $100 per hour for any additional conferences, depositions
      and court testimony; and

   -- $400 half-day charge for said conferences, depositions and
      court testimony.

The Debtor believes that Appraisal Services, Inc., is
disinterested as that term is defined in Section 101(14) of the
U.S. Bankruptcy Court.

Headquartered in Grand Prairie, Texas, Medical Technology, Inc.,
dba Bledsoe Brace Systems -- http://www.bledsoebrace.com/home.asp    
-- manufactures and distributes orthopedic knee braces, ankle
braces, ankle supports, knee immobilizers, arm braces, sport
braces, boots, and walkers.  The Debtor filed chapter 11
protection on July 25, 2005 (Bankr. N.D. Tex. Case No. 05-47377).  
J. Robert Forshey, Esq., Jeff P. Prostok, Esq., and Julie C.
McGrath, Esq., at Forshey & Prostok, LLP, represent the Debtor in
its restructuring efforts.  When the Debtor filed filed for
protection from its creditors, it estimated assets and debts
between $10 million to $50 million.


MERCURY INTERACTIVE: Financial Filing Delay Prompts Default Notice
------------------------------------------------------------------
Mercury Interactive Corporation (Nasdaq: MERQE) received from the
trustee for the Company's $500 million aggregate principal amount
of Zero Coupon Senior Convertible Notes due 2008 and the Company's
$300 million aggregate principal amount of 4.75% Convertible
Subordinated Notes due 2007 a notice of default on the Notes.  As
a result of the Company's failure to file with the Securities and
Exchange Commission its Quarterly Report on Form 10-Q for the
quarter ended June 30, 2005, the Company has violated indenture
provisions that require Mercury to furnish such information
promptly to the trustee.

Under the indentures relating to the Notes, the Company has until
October 25, 2005 to cure its breach by filing with the Securities
and Exchange Commission and providing to the trustee its Quarterly
Report on Form 10-Q for the quarter ended June 30, 2005.  If
Mercury does not cure its breach within that period, either the
trustee for the Notes or the holders of at least 25% of the
aggregate principal amount of the outstanding Notes could, by
giving the Company an additional notice, accelerate the maturity
of the Notes, causing the outstanding principal amount plus
accrued interest to be immediately due and payable.

"Given the continued strength of Mercury's financial position, we
are disappointed to have received the notice," said Doug Smith,
chief financial officer at Mercury.  "Mercury has the available
cash and investment securities to fully retire any and all amounts
of the Notes should they accelerate, as well as to provide for the
Company's working capital needs."

As of August 26, 2005, all required interest and principal
payments have been timely made on the Notes.  If the maturity of
the Notes is accelerated, the Company intends to fully repay all
such amounts due.  As of June 30, 2005, the Company had
approximately $1.32 billion of cash and investments.

Mercury Interactive Corporation -- http://www.mercury.com/--, the  
global leader in business technology optimization (BTO) software,
is committed to helping customers optimize the business value of
information technology. Founded in 1989, Mercury conducts business
worldwide and is one of the fastest growing enterprise software
companies today.  Mercury provides software and services for IT
Governance, Application Delivery, and Application Management.  
Customers worldwide rely on Mercury offerings to govern the
priorities, processes and people of IT and test and manage the
quality and performance of business-critical applications.  
Mercury BTO offerings are complemented by technologies and
services from global business partners.


MERCURY INTERACTIVE: Restating Financials for Three Fiscal Years
----------------------------------------------------------------
Mercury Interactive Corporation (Nasdaq: MERQE) previously
disclosed that it had created a Special Committee, comprised of
disinterested members of the Audit Committee of the Board of
Directors, in response to an informal inquiry initiated by the
Securities and Exchange Commission.  Based on the Special
Committee's preliminary investigation, the Company had previously
stated that it was highly likely that it would need to restate its
historical financial statements but had not reached a definitive
conclusion.

Mercury has now concluded that its previously issued financial
statements for the fiscal years 2002, 2003 and 2004, which are
included in the Company's Annual Report on Form 10-K for the year
ended December 31, 2004, the Quarterly Reports on Form 10-Q filed
with respect to each of these fiscal years and the financial
statements included in the Company's Quarterly Report on Form 10-Q
for the first quarter of fiscal year 2005, should no longer be
relied upon and will be restated.  In addition, the restatement
will affect financial statements for prior fiscal years, and the
Company will also require a revision of the previously reported
financial information included in its press release of July 28,
2005 and its Current Report on Form 8-K dated August 17, 2005.

Mercury intends to complete the restatements and make the required
amended Form 10-K and Form 10-Q filings and to file its Form 10-Q
for the second quarter of fiscal year 2005 as soon as practicable
following completion of the Special Committee investigation, the
Company's review and restatement of its historical financials and
completion of the audit process.  The Company does not expect that
it will be able to complete this process and make the required
filings before November 2005.

The errors resulting in the required restatement relate to the
Special Committee's conclusion that the actual dates of
determination for certain past stock option grants differed from
the originally selected grant dates for such awards.  Because the
prices at the originally selected grant dates were lower than the
price on the actual dates of determination, the Company will incur
additional charges to its stock-based compensation expense, which
were not included in the above-referenced financial statements.  
The Company has determined that the amounts of these charges are
material but has not yet determined the final amount of the
additional charges to be incurred.

                      Likely Material Weakness

Additionally, Mercury is evaluating Management's Report on
Internal Control Over Financial Reporting set forth in Item 9a on
page 53 of the Company's 2004 Annual Report.  Although Mercury has
not yet completed its analysis of the impact of this situation on
its internal controls over financial reporting, it has determined
that it is highly likely that Mercury had a material weakness in
internal control over financial reporting as of December 31, 2004.
A material weakness is a control deficiency, or a combination of
control deficiencies, that results in more than a remote
likelihood that a material misstatement of the annual or interim
financial statements will not be prevented or detected.  The
existence of one or more material weaknesses as of December 31,
2004 would preclude Mercury from concluding that its internal
controls over financial reporting were effective as of year-end.
If Mercury were to conclude that a material weakness existed, it
would expect to receive an adverse opinion on internal control
over financial reporting from its independent registered public
accounting firm.

As previously disclosed, Mercury does not believe that any
restatements will have an impact on its historical revenues, cash
position or non-stock option related operating expenses.  Any
charges will have the effect of decreasing the earnings and
retained earnings figures contained in Mercury's historical
financial statements.

Mercury Interactive Corporation -- http://www.mercury.com/--, the  
global leader in business technology optimization (BTO) software,
is committed to helping customers optimize the business value of
information technology. Founded in 1989, Mercury conducts business
worldwide and is one of the fastest growing enterprise software
companies today.  Mercury provides software and services for IT
Governance, Application Delivery, and Application Management.  
Customers worldwide rely on Mercury offerings to govern the
priorities, processes and people of IT and test and manage the
quality and performance of business-critical applications.  
Mercury BTO offerings are complemented by technologies and
services from global business partners.


MILLENNIUM AMERICA: Buying Back $350 Mil. of 7% Sr. Notes for Cash
------------------------------------------------------------------
Millennium America Inc. commenced a cash tender offer for up to
$350 million principal amount of its 7.00% Senior Notes due 2006.   
The Offer is being made pursuant to an Offer to Purchase, dated
Aug. 29, 2005, which more fully sets forth the terms and
conditions of the Offer.

To receive the applicable total consideration, holders must
validly tender and not withdraw their notes by 5 p.m. EDT on
Monday, Sept. 12, 2005.  Holders who tender notes after the Early
Tender Date will receive the applicable total consideration minus
the $30 per $1,000 principal amount early tender payment.

The total consideration per $1,000 principal amount of notes
validly tendered and not withdrawn prior to the Early Tender Date
will consist of an amount equal to the present value on the
settlement date (as defined in the Offer to Purchase) of $1,000
and the amount of interest that would accrue from the settlement
date to, but not including, the maturity date of November 15,
2006, determined based on a fixed spread of 75 basis points over
the yield on the price determination date of the 3-1/2% U.S.
Treasury Note due Nov. 15, 2006.  In addition, accrued and unpaid
interest up to, but not including, the settlement date will be
paid in cash on all validly tendered and accepted notes.

The Offer will expire at midnight EDT on Monday, Sept. 26, 2005,
unless extended or earlier terminated by Millennium.  Tendered
notes may not be withdrawn after 5 p.m. EDT on Monday, Sept. 12,
2005, unless the Offer is extended by Millennium.

The settlement date is expected to occur promptly after the
expiration date.  The price determination date will be Tuesday,
Sept. 13, 2005, unless extended by Millennium.  In the event that
the Offer is oversubscribed, tenders of notes will be prorated
based on the aggregate principal amount of notes tendered in the
Offer and the total principal amount of notes outstanding.

The complete terms and conditions of the Offer are set forth in
the Offer to Purchase dated Aug. 29, 2005, which is being sent to
holders of notes.  Holders are urged to read the tender offer
documents carefully.

Banc of America Securities is the exclusive dealer manager for the
Offer.  Questions regarding the Offer may be directed to Banc of
America Securities LLC, High Yield Special Products, at 888-292-
0070 (U.S. toll-free) and 704-388-4813 (collect).  Copies of the
Offer to Purchase and Letter of Transmittal may be obtained from
the Information Agent for the Offer, D.F. King & Co., Inc., at
800-758-5378 (U.S. toll-free) and 212-269-5550 (collect).

This press release is neither an offer to purchase, nor a
solicitation for acceptance of an offer to purchase securities.
Millennium is making the Offer only by, and pursuant to the terms
of, the Offer to Purchase.

Millennium America Inc. is a wholly owned subsidiary of Millennium
Chemicals Inc., a major international producer of chemicals
including titanium dioxide (TiO2). Millennium Chemicals Inc. is a
wholly owned subsidiary of Lyondell Chemical Company (NYSE: LYO).

                        *     *     *

As reported in the Troubled Company Reporter on Aug. 12, 2005,
Fitch Ratings has assigned a 'BB+' to the new US$250 million five-
year guaranteed secured bank facility of Millennium America with
Millennium Inorganic Chemicals, a co-borrower under the facility.

This facility replaces an existing secured credit facility that
was due to mature in June 2006 that was also rated 'BB+'.  Both
Millennium America Inc. and MICL are subsidiaries of Millennium
Chemicals, Inc., which is a subsidiary of Lyondell Chemical.

In addition, Fitch affirms Millennium America's senior unsecured
notes at 'BB' as well as Millennium Chemical's convertible senior
unsecured debentures rating at 'BB'.  Millennium's Issuer Default
Rating is 'B+'.  Fitch said the rating outlook remains stable.


MIRANT CORP: U.S. Trustee Alters MAGi Committee Membership
----------------------------------------------------------
Pursuant to Section 1102(a)(1) of the Bankruptcy Code, William T.
Neary, U.S. Trustee for Region 6, informs the U.S. Bankruptcy
Court for the Northern District of Texas that the California
Public Employees Retirement System, as represented by Tom Baker,
is no longer a member of the Official Committee of Unsecured
Creditors for Mirant Americas Generation, LLC.

Ivan Kristicevic also replaces Dan Gropper as representative of
Elliott Associates, L.P.

The MAGi Committee currently consists of:

     1. Mike Claybar
        California Public Employees Retirement System
        Lincoln Plaza
        400 P Street
        Sacramento, CA 95814
        Phone: (916) 795-3396
        Fax: (916) 326-3330
        Mike_Claybar@calpers.ca.gov

     2. Ivan Kristicevic
        Elliott Associates, L.P.
        712 Fifth Avenue, 36th Floor
        New York, NY 10019
        Phone: (212) 506-2999
        Fax: (212) 974-2092
        Ivan@elliottmgmt.com

     3. Don Morgan
        Mackay Shields Financial
        9 West 57th Street
        New York, NY 10019
        Phone: (212) 230-3911
        Fax: (212) 754-9187
        don.morgan@mackayshields.com

     4. Thomas M. Korsman
        Wells Fargo Bank Minnesota, National Association
        MAC N9303-120
        Sixth and Marquette Minneapolis, MN 55479
        Phone: (612) 466-5890
        Fax: (612) 667-9825 fax
        thomas.m.korsman@wellsfargo.com


Headquartered in Atlanta, Georgia, Mirant Corporation --
http://www.mirant.com/-- is a competitive energy company that
produces and sells electricity in North America, the Caribbean,
and the Philippines.  Mirant owns or leases more than 18,000
megawatts of electric generating capacity globally.  Mirant
Corporation filed for chapter 11 protection on July 14, 2003
(Bankr. N.D. Tex. 03-46590).  Thomas E. Lauria, Esq., at White &
Case LLP, represents the Debtors in their restructuring efforts.
When the Debtors filed for protection from their creditors, they
listed $20,574,000,000 in assets and $11,401,000,000 in debts.
(Mirant Bankruptcy News, Issue No. 74; Bankruptcy Creditors'
Service, Inc., 215/945-7000)


MIRANT CORP: Chapter 11 Examiner Files Seventh Interim Report
-------------------------------------------------------------
William K. Snyder, the chapter 11 examiner appointed in Mirant
Corporation and its debtor-affiliates' chapter 11 cases, presents
to the U.S. Bankruptcy Court for the Northern District of Texas
his Seventh Interim Report, which focuses on:

   a. the enterprise value of the estates of Mirant Corporation
      and its debtor affiliates;

   b. the investigation of the Debtors' estimation of the
      total claims -- the "claims hurdle" -- that must be
      satisfied before residual value may be distributed to
      shareholders and the holders of 6.25% Junior Subordinated
      Convertible Debentures due 2030; and

   c. certain issues relating to the compensation of
      professionals.

A full-text copy of the Chapter 11 Examiner's Seventh Interim
report is available for free at:

         http://bankrupt.com/misc/7thExaminerReport.pdf

                Recalculation of Enterprise Value

Mr. Snyder notes that based on the timetable presented to the
Court by the Valuation Implementation Committee, the VIC does not
expect to be able to report its findings on the enterprise value
of Mirant as formulated by the Valuation Ruling before
September 21, 2005.

                           Claims Hurdle

Mr. Snyder informs the Court that the Debtors have finally
provided him with substantial data relating to third party claims
asserted against Mirant.  The Examiner continues to request the
information for a number of reasons:

   (a) originally, to evaluate the sufficiency of the disclosure
       provided in the Debtors' Disclosure Statement as relates
       to the treatment creditors could expect to receive in a
       liquidation scenario;

   (b) later, in an effort to narrow the scope of the Valuation
       Hearing by defining the claims hurdle that the Official
       Committee of Equity Holders and the Phoenix Entities must
       surmount to be declared in the money; and

   (c) most recently, to determine whether the Equity Committee
       and subordinated debt holders will actually be "in the
       money" if the enterprise valuation provided by the
       Valuation Ruling surpasses the Court's benchmark of
       $11 billion.

The Debtors have also provided Mr. Snyder with a schedule of
remaining unresolved claims and the amount currently reserved by
the Debtors for those claims.  However, Mr. Snyder reports that
there are additional disputed or unresolved claims that are not
included in the Reserve Amount.

Mr. Snyder reports that 13 Mirant-level subsidiaries may be
solvent on a balance sheet basis.  The Debtors' analysis confirms
that creditors of at least those 13 subsidiaries could
"theoretically" be paid in full under a liquidation scenario.

                         Plan Negotiations

While the constituencies continue to work to gain transparency on
the total estimated claims, Mr. Snyder relates that the Debtors
and the different committees established in their Chapter 11
cases have taken the opportunity to engage in various discussions
to determine whether a consensual resolution may be reached that
would:

    (i) resolve the valuation issue prior to the completion of
        the VIC's work; and

   (ii) pave the way for a consensual plan of reorganization.

                   Unmonitored Professional Fees

Mr. Snyder reports that fees paid to certain of the Debtors'
professionals do not pass the Fee Review Committee.

Mr. Snyder has identified 13 bankruptcy advisors whose fees are
not currently being monitored by the Fee Review Committee.

Mr. Snyder estimates that the actual, bankruptcy-related fees and
expenses incurred by professionals through June 30, 2005, exceeds
$300,000,000.

Mr. Snyder has advised Dean Nancy Rapoport, chair of the Fee
Review Committee, of his findings.  The Fee Review Committee has
requested clarification from the Court of its duty, if any, to
monitor compensation of the Debtors' professionals.

Headquartered in Atlanta, Georgia, Mirant Corporation --
http://www.mirant.com/-- is a competitive energy company that
produces and sells electricity in North America, the Caribbean,
and the Philippines.  Mirant owns or leases more than 18,000
megawatts of electric generating capacity globally.  Mirant
Corporation filed for chapter 11 protection on July 14, 2003
(Bankr. N.D. Tex. 03-46590).  Thomas E. Lauria, Esq., at White &
Case LLP, represents the Debtors in their restructuring efforts.
When the Debtors filed for protection from their creditors, they
listed $20,574,000,000 in assets and $11,401,000,000 in debts.
(Mirant Bankruptcy News, Issue No. 74; Bankruptcy Creditors'
Service, Inc., 215/945-7000)


MIRANT CORP: Court Approves Collateral Transfer Agreement
---------------------------------------------------------
Judge Lynn of the U.S. Bankruptcy Court for the Northern District
of Texas approved the Collateral Transfer Agreement inked between
Georgia Power Company and West Georgia Generation Company,
L.L.C., formerly known as West Georgia Generation Company L.P, a
Mirant Corporation debtor-affiliated.

Georgia Power, West Georgia and Cataula Generation Company, L.P.,
entered into two Negotiated Contracts for the Purchase of Firm
Capacity and Energy on July 18, 1996, and September 10, 1999.

Pursuant to the 1996 Agreement, West Georgia agreed to sell to
Georgia Power its electric generating facility located in
Thomaston, Georgia.  The 1996 Agreement expired by its terms on
June 1, 2005.

West Georgia also agreed to sell to Georgia Power under the 1999
Agreement:

    (a) 300 MW of capacity and no more than 350 MW of capacity
        between June 1, 2002, and May 31, 2005; and

    (b) 447 MW of capacity and no more than 525 MW of capacity
        between June 1, 2005, and May 31, 2009.

The 1996 Agreement required West Georgia to post an $8 million
collateral in the form of a letter of credit.  Georgia Power
subsequently drew down the entire letter of credit and is holding
the $8 million, plus interest, as cash collateral.  The 1996
Agreement also requires Georgia Power to deliver the 1996
Collateral to West Georgia on July 1, 2005.

West Georgia posted another letter of credit for the benefit of
Georgia Power amounting to $16 million pursuant to the 1999
Agreement.  Georgia Power drew down the entire letter of credit
and is holding the $16 million, plus interest, as cash
collateral.  Georgia Power is currently holding the collateral,
and has applied $30,000 of the 1999 Collateral as liquidated
damages.  The 1999 Agreement required West Georgia to increase
the letter of credit, or "Performance Security" from $16 million
to $24 million.

To resolve all issues arising out of the Collaterals, Jason D.
Schauer, Esq., at White & Case LLP, in Miami, Florida, relates
that Georgia Power and West Georgia entered into an agreement on
July 5, 2005.

The Agreement provides that:

    (a) Georgia Power will accept and retain an amount from the
        1996 Collateral sufficient to satisfy West Georgia's
        obligation to increase West Georgia's "Performance
        Security" under the 1999 Agreement;

    (b) Georgia Power will waive its obligation to deliver the
        1996 Collateral to West Georgia;

    (c) Georgia Power may retain any and all interest, accruing
        since April 14, 2005, necessary to maintain the $24
        million cash collateral; and

    (d) Any money in excess of the $24 million principal amount
        must be delivered to West Georgia.

The parties acknowledge that Georgia Power does not have a
continuing duty to turn over any accrued interest on the 1999
Collateral to West Georgia except in accordance with the 1999
Agreement, but in the event the amount of the "Performance
Security" is permitted to be reduced under the terms of the 1999
Agreement, or West Georgia in its sole discretion replaces all or
a portion of the Performance Security with a letter of credit,
the amount of the 1999 Collateral equal to the amount of
Performance Security reduced or replaced must be promptly
returned to West Georgia in accordance with the terms of the 1999
Agreement.

Headquartered in Atlanta, Georgia, Mirant Corporation --
http://www.mirant.com/-- is a competitive energy company that
produces and sells electricity in North America, the Caribbean,
and the Philippines.  Mirant owns or leases more than 18,000
megawatts of electric generating capacity globally.  Mirant
Corporation filed for chapter 11 protection on July 14, 2003
(Bankr. N.D. Tex. 03-46590).  Thomas E. Lauria, Esq., at White &
Case LLP, represents the Debtors in their restructuring efforts.
When the Debtors filed for protection from their creditors, they
listed $20,574,000,000 in assets and $11,401,000,000 in debts.
(Mirant Bankruptcy News, Issue No. 72; Bankruptcy Creditors'
Service, Inc., 215/945-7000)


MOBIFON HOLDINGS: Won't File Quarterly Report Within Deadline
-------------------------------------------------------------
MobiFon Holdings B.V. didn't file its quarterly report for the
second quarter ending June 30, 2005, within the 60-day filing
deadline imposed by the indenture relating to its $225 million
12.50% Notes due 2010.  MobiFon said the delay is due to:

   -- the receipt by the Company of a comment letter from the
      Securities and Exchange Commission relating to its Form 20-F
      and its Consolidated Financial Statements and Operating and
      Financial Review and Prospects for the year ended Dec. 31,
      2004, filed on Form 6-K on May 19, 2005; and

   -- an ongoing exercise that commenced on the completion of the
      acquisition of the Company by Vodafone International
      Holdings B.V. on May 31, 2005, to review its accounting
      policies with a view to conforming them to Vodafone Group
      practices.

A full-text copy of the Prospectus relating the details of the
quarterly reporting covenant is available at no charge at
http://ResearchArchives.com/t/s?128

The Company is not in breach of any SEC filing deadlines.

The items addressed in the SEC comment letter relate to the
clarification of existing accounting and related disclosures and
include potential requests for additional disclosure; as such,
neither they nor the review of accounting policies impact the
ability of the Company to pay principal and interest when due on
the Notes nor do they reflect any concerns related to the business
of its subsidiary MobiFon SA.

MobiFon Holdings B.V, domiciled in the Netherlands, is the
majority owner of MobiFon S.A, a leading mobile telecom operator
in Romania with a 48% market share as of 31 December 2004.  In
2004, MobiFon generated US$723 million in revenue with an OIBDA
margin of approximately 47% and a subscriber base of 4.9
million.

                        *     *     *

As reported in the Troubled Company Reporter-Latin America on
June 17, 2005, Standard & Poor's Ratings Services raised its
ratings on MobiFon Holdings B.V. to 'BB' from 'BB-' on completion
of Vodafone Group plc's (A/Stable/A-1) acquisition of the company.  
At the same time, Standard & Poor's raised the rating on MobiFon
Holdings' US$223 million senior unsecured notes due 2010 to 'B+'
from 'B'.  S&P also removed the ratings from CreditWatch, where
they were placed with positive implications March 15, 2005.  S&P
said the outlook is currently stable.


MORGAN STANLEY: Fitch Upgrades $5.8 Mil Class J Certs. to BB+
----------------------------------------- -------------------
Fitch Ratings upgrades Morgan Stanley Dean Witter Capital I Trust
2002-IQ2 commercial mortgage pass-through certificates, series
2002-IQ2:

     -- $25.3 million class B to 'AAA' from 'AA';
     -- $24.3 million class C to 'AA-' from 'A';
     -- $7.8 million class D to 'A+' from 'A-';
     -- $7.8 million class E to 'A' from 'BBB+';
     -- $7.8 million class F to 'A-' from 'BBB';
     -- $5.8 million class G to 'BBB' from 'BBB-';
     -- $9.7 million class H to 'BBB-' from 'BB+';
     -- $5.8 million class J to 'BB+' from 'BB'.

Fitch also affirms these classes:

     -- $91.3 million class A-2 at 'AAA';
     -- $151 million class A-3 at 'AAA';
     -- $262.3 million class A-4 at 'AAA';
     -- $3.9 million class K at 'BB-';
     -- $3.9 million class L at 'B+'.
     -- $2.9 million class M at 'B';
     -- $2.9 million class N at 'B-'.

Fitch does not rate the $7.8 million class O certificates.

The upgrades reflect increased credit enhancement due to paydowns
and amortization.  As of the August 2005 distribution date, the
pool's aggregate certificate balance has decreased 20.3%, to
$620.5 million from $778.6 million since issuance.  Of the
original 105 loans, 92 are currently outstanding.  The loans are
fixed-rate, seasoned loans.

Three loans, Woodfield Mall, Joe Scott Portfolio, and One Seaport
Plaza (22.9% of the pool) remain investment grade credit
assessments.  Fitch reviewed operating statement analysis reports
and other performance information provided by ORIX.  The debt
service coverage ratio for each loan is calculated using the Fitch
adjusted net cash flow and a stressed debt service based on the
current loan balance and a hypothetical mortgage constant.

The Woodfield Mall loan (9.7%) is secured by a 2.2 million square
foot mall located in Schaumburg, IL.  The $60.0 million A note
interest in this pool is the senior portion of a pari passu loan
with a total outstanding balance of $248.5 million.  The year-end
2004 Fitch stressed DSCR for the A note only was 1.68 times (x)
compared to 1.66x at issuance.  In-line occupancy as of YE 2004
was 91%, an increase from 88% at issuance.

One Seaport Plaza (9.6%) is secured by a 35-story, 1.1 million sf
office building located in downtown Manhattan, NY.  The loan
consists of a 32.2% ($59.4 million) pari passu interest in a
$184.9 million whole loan.  The loan is on the master servicer's
watchlist for a DSCR decrease resulting from extraordinary
expenses associated with leasing up approximately 12.4% of net
rentable area in 2004 after a major tenant vacated.  Fitch
normalized these expenses to issuance levels to derive an adjusted
NCF.  As of the trailing twelve months ended March 2005, NCF
decreased approximately 4.9% from issuance.  The corresponding
DSCR, as of the TTM, was 1.45x compared to 1.48x at issuance.  
Occupancy as of March 2005 increased to 96.8% compared to 82.0% at
issuance.

The Joe Scott Portfolio (3.6%) currently has three of the ten
loans on the servicer's watchlist for decreased occupancy.  The
overall occupancy for this portfolio is down as of March 2005 to
78.9% compared to 85.5% at issuance, which is reflective of the
current suburban St. Louis office market.  However, the portfolio
benefits from overall low leverage of $38.15 per square foot and a
short, 20-year amortization schedule which provides for
significant principal paydown over the term.  Fitch's stressed
DSCR for the TTM ended March 2005 is 1.50x as compared to 1.65x at
issuance.

Two loans are in special servicing, although both loans are
current at this time.  The first loan (0.89%) is secured by an
office property in Englewood, CO.  The special servicer is
evaluating workout options including a note sale and a deed in
lieu and losses are expected.  The next loan (0.17%) is secured by
a single-tenant retail property in Jeffersonville, IN.  The loan
was just transferred into special servicing as the tenant
occupying the property has filed for bankruptcy.


MORGAN STANLEY: Fitch Affirms Low-B Rating on Six Cert. Classes
---------------------------------------------------------------
Morgan Stanley Capital I Trust, series 2004-RR2, commercial
mortgage-backed securities pass-through certificates are affirmed
by Fitch Ratings:

     -- $111.8 million class A-1 at 'AAA';
     -- $109.1 million class A-2 at 'AAA';
     -- Notional class X at 'AAA';
     -- $30.2 million class B at 'AA';
     -- $15.1 million class C at 'A';
     -- $5.3 million class D at 'A-';
     -- $12.2 million class E at 'BBB';
     -- $3.3 million class F at 'BBB-';
     -- $6.9 million class G at 'BB+';
     -- $3.7 million class H at 'BB';
     -- $2.5 million class J at 'BB-';
     -- $2.5 million class K at 'B+';
     -- $2.5 million class L at 'B';
     -- $1.6 class M at 'B-'.

Classes N-1 through N-5 are not rated by Fitch.

The rating affirmations are the result of stable performance of
the underlying collateral and limited paydown to this transaction.  
As of the July 2005 distribution date, the transaction has paid
down 0.7% to $323.8 million from $326.1 million at issuance.

The certificates are collateralized by all or a portion of 39
classes of fixed-rate commercial mortgage-backed securities from
28 transactions.  The current weighted average rating factor of
the underlying bonds is 10.89, corresponding to an average rating
of 'BB+/BB', stable from issuance.  The classes' ratings are based
on Fitch's actual rating, or on Fitch's internal credit assessment
for those classes not rated by Fitch.

Delinquencies in the underlying transaction are as follows: 30
days: 0.2%; 60 days: 0.1%; 90+ days: 0.5%; Foreclosure: 0.3%; and
real estate owned: 0.5%.


MQ ASSOCIATES: Consent Solicitation Expires Today
-------------------------------------------------
MQ Associates, Inc. and MedQuest, Inc. extended the expiration
date for the previously announced consent solicitations to seek
certain amendments to:

    (i) the outstanding 12-1/4% Senior Discount Notes due 2012
        of MQ Associates and the related indenture dated as
        of August 24, 2004, and

   (ii) the outstanding 11-7/8% Senior Subordinated Notes due 2012
        of MedQuest and the related indenture dated as of
        August 15, 2002.

The consent solicitations by the Company, each previously
scheduled to expire at 5:00 p.m., New York City time, on Aug. 26,
2005, will now expire at 5:00 p.m., New York City time, today,
August 31, 2005, unless further extended.

The Company has been advised by Global Bondholder Services
Corporation, the tabulation agent for the consent solicitations,
that, as of 5:00 p.m., New York City Time, on August 26, 2005,
valid consents have been received from holders of approximately
$135.8 million in aggregate principal amount at maturity of the
12-1/4% Notes, and $179.2 million in aggregate principal amount of
the 11-7/8% Notes.  The Company has retained Global Bondholder
Services Corporation to serve as the tabulation agent and
information agent.

Copies of the consent solicitation statement and related documents
may be obtained at no charge by contacting the information agent
by telephone at (866) 952-2200 (toll free), or (212) 430-3774, or
in writing at 65 Broadway, Suite 704, New York, NY 10006,
Attention: Corporate Actions.  Questions regarding the consent
solicitations may be directed to the information agent at the same
telephone numbers and address.

This announcement is not a solicitation of consents with respect
to any Notes.  The solicitations are being made solely by the
consent solicitation statement.  The consent solicitations are not
being made to, nor will letters of consent and release be accepted
from or on behalf of, holders in any jurisdiction in which the
making of the consent solicitations or the acceptance of such
letters of consent and release would not be in compliance with the
laws of such jurisdiction.

MQ Associates is a holding company and has no material assets or
operations other than its ownership of 100 percent of the
outstanding capital stock of MedQuest.  MedQuest is a leading
operator of independent, fixed-site, outpatient diagnostic imaging
centers in the United States. These centers provide high quality
diagnostic imaging services using a variety of technologies,
including magnetic resonance imaging, computed tomography, nuclear
medicine, general radiology, ultrasound and mammography.  As of
June 30, 2005, MedQuest operated a network of 96 centers in 13
states located primarily throughout the southeastern and
southwestern United States.

                           *     *     *

The Company's 12-1/4% senior discount notes due 2012 carry Moody's
Investors Service's and Standard & Poor's junk ratings.


NDCHEALTH CORP: Sells Business to Per-Se & Wolters for $1 Billion
-----------------------------------------------------------------   
Per-Se Technologies, Inc. (Nasdaq: PSTI) and NDCHealth Corporation
(NYSE: NDC) inked definitive agreements for the sale of NDCHealth,
in a transaction valued at approximately $1 billion.

Per-Se Technologies will acquire Atlanta-based NDCHealth,
including the physician, hospital and retail pharmacy businesses,
for total consideration of approximately $665 million, which
includes refinancing NDCHealth's outstanding debt at closing,
currently totaling approximately $270 million.  

As part of the transaction, Wolters Kluwer (ASE: WKL), based in
Amsterdam, the Netherlands, will purchase the pharmaceutical
information management business from NDCHealth for $382 million in
cash.  The combined transaction, after income taxes, debt
refinancing and transaction costs, will result in compensation to
NDCHealth's shareholders of $19.50 per share, with at least $13.00
paid in cash and up to $6.50 paid in Per-Se stock, as to be
determined by Per-Se and to be announced prior to the shareholder
meetings.

Neil Williams, lead independent director of NDCHealth, stated,
"After an extensive and thorough sale process initiated in March,
the NDCHealth Board of Directors believes these combined
transactions represent the best value for NDCHealth's shareholders
and offer the best strategic fit for the Company's customers and
employees."

"Per-Se's and Wolters Kluwer's resources and strategic focus on
key segments of the healthcare marketplace should create
substantial benefits for our pharmacy, hospital, physician and
pharmaceutical customers," commented Walter M. Hoff, NDCHealth's
chairman and chief executive officer.  "The addition of
NDCHealth's businesses and expertise will also enable both Per-Se
and Wolters Kluwer to offer a wider range of products to an
expanded base of customers."

Per-Se's purchase of NDCHealth combines Per-Se's leading position
in business process outsourcing for hospital-affiliated physicians
with NDCHealth's leading positions in hospital, physician and
retail pharmacy technology and solutions.  The acquisition will
increase Per-Se's revenue by more than 60% on a trailing 12-month
pro forma basis as of June 30, 2005.  The complementary revenue
cycle management offerings of the two companies will provide
future opportunities to improve the business of healthcare.

"Per-Se and NDCHealth share the strategic focus of improving the
financial success of provider organizations," stated Philip M.
Pead, Per-Se's chairman, president and chief executive officer.
"By combining our complementary solutions and services, we will be
able to improve the flow of information at the point of care
enabling providers, patients and payers to take advantage of a
more efficient healthcare system."

                      Acquisition Expected
       to be Earnings and Cash Flow Accretive in Year One

The combined entity would have pro forma revenues of approximately
$590 million as of June 30, 2005, and improved operating
profitability compared to their separate historical performances.   
The combination of the two companies is expected to generate
accretion from operational and other synergies of between $15
million and $20 million in year one.  Per-Se expects that the
acquisition, excluding transaction-related and other one-time
costs, will be accretive to earnings per share and significantly
accretive to cash flow per share in year one.

"Both Per-Se and NDCHealth generate significant levels of
operating cash flow due to the recurring revenue nature of both
businesses," stated Mr. Pead.

                    Financing of Transaction

Per-Se intends to raise approximately $410 million in new debt
related to the transaction to refinance NDCHealth's outstanding
debt and fund cash to shareholders.  NDCHealth's outstanding debt,
currently totaling approximately $270 million, consists of its
$200 million 10-1/2% senior subordinated notes due Dec. 1, 2012,
and its senior secured credit facility that includes a six-year
term loan and a revolving credit facility.  Per-Se has received a
financing commitment from Bank of America, N.A. for the
transaction.

"Through our acquisition of NDCHealth, we are focused on
capitalizing on opportunities that will improve the efficiencies
of our customers' businesses and of our healthcare system," stated
Mr. Pead. "The combination of Per-Se's and NDCHealth's solutions
and people provides synergy and growth prospects to maximize
future value for our shareholders."

            Closing Conditions, Shareholder Approval
                     and Anticipated Closing

The transaction is subject to approval by the shareholders of both
Per-Se and NDCHealth.  The parties expect to complete the
transaction within three to six months.  Each transaction is
subject to regulatory review under U.S. antitrust laws and other
customary closing conditions. The completion of Per-Se's
transaction is also subject to the closing of the Wolters Kluwer
transaction.

The Blackstone Group L.P. and Goldman, Sachs & Co. acted as
financial advisors to NDCHealth in the sale process, and provided
fairness opinions on the sale of NDCHealth.  Banc of America
Securities provided a fairness opinion to Per-Se on the
transaction.

                    About Per-Se Technologies

Per-Se Technologies (Nasdaq: PSTI) -- http://www.per-se.com/-- is  
the leader in Connective Healthcare.  Connective Healthcare
solutions from Per-Se enable physicians and hospitals to achieve
their income potential by creating an environment that streamlines
and simplifies the complex administrative burden of providing
healthcare.  Per-Se's Connective Healthcare solutions help reduce
administrative expenses, increase revenue and accelerate the
movement of funds to benefit providers, payers and patients.

                         About NDCHealth

Headquartered at Atlanta, Ga., NDCHealth Corporation --  
http://www.ndchealth.com/-- is a leading information solutions    
company serving all sectors of healthcare.  Its network solutions  
have long been among the nation's leading, automating the exchange  
of information among pharmacies, payers, hospitals and physicians.   
Its systems and information management solutions help improve  
operational efficiencies and business decision making for  
providers, retail pharmacy and pharmaceutical manufacturers.   

                         *     *     *

Standard & Poor's Ratings Services affirmed NDCHealth's corporate  
credit and senior secured ratings at 'B' and the subordinated debt  
rating is affirmed at 'CCC+'.

As reported in the Troubled Company Reporter on May 16, 2005,
Moody's Investors Service confirmed NDCHealth Corporation's senior
secured bank debt rating at B1, its senior subordinated notes
rating at B3, and its senior implied rating at B1, concluding a
review for downgrade initiated January 6, 2005.  Moody's said the
rating outlook is negative.

Ratings Confirmed:

   * Senior Implied Rating of B1
   * $125 Million Term Loan due 2008 rated B1
   * $100 Million Revolving Credit Facility due 2008 rated B1
   * $200 Senior Subordinated Notes due 2012 rated B3
   * Long Term Issuer Rating rated B2


OMNI ENERGY: Completes $25 Million Term B Credit Facility
---------------------------------------------------------
OMNI ENERGY SERVICES CORP. (Nasdaq: OMNI) completed a new
$25 million junior credit facility with ORIX USA's Corporate
Finance Group.  The proceeds will be used to:

     (i) reduce the current outstanding balance under the
         Company's Term A senior term debt from $8.4 million to
         $5 million;

    (ii) retire approximately $3.3 million of former debenture
         obligations with the payment of $1.5 million cash and the
         issuance of 750,000 shares of OMNI common stock;

   (iii) retire $2 million of certain subordinated debt with the
         payment of $1 million cash and the issuance of 200,000
         shares of OMNI common stock; and

    (iv) provide working capital and funds necessary for potential
         strategic transactions.

Advances under the new credit facility will be repaid at a rate of
$700,000 per year, plus interest, beginning in April 2008.  In the
event the Company no longer has any senior term debt outstanding,
the annual principal amortization of the junior credit facility
will be increased to 7.5% of the advances outstanding under the
junior credit facility as of Dec. 31, 2006.  The junior credit
facility matures in August 2010 and will accrue interest at the
rate of LIBOR plus 8%.

Additionally, OMNI has also accepted a $25 million commitment from
Fusion Capital Fund II, LLC, an institutional investor, for the
continuous secondary offering of the Company's common stock.  
Subject to the negotiation and execution of definitive documents
and other ordinary and customary closing conditions for a
transaction of this type, the proceeds will be used from time-to-
time to reduce debt and supplement funding necessary for potential
strategic transactions.

Finally, OMNI announced the closing of the second tranche of the
previously announced Series C 9% Convertible Preferred Stock
offering, the first tranche of which was closed by the Company in
May.  In successfully completing the second tranche of this
offering, the Company received $1.5 million in proceeds.

"During the past year, we have worked diligently to return OMNI to
its core business segments and focus on re-structuring and
strengthening our balance sheet," James C. Eckert, OMNI's Chairman
and Chief Executive Officer, said.  "Completing the new
$25 million junior credit facility, closing the second tranche of
the Series C Preferred, and accepting the commitment for the
proposed $25 million continuous secondary offering to supplement
our existing $30 million Term A senior credit facility and $15
million revolving credit facility, provides the Company with the
investment capital essential to aggressively pursue expansion of
our core businesses.  Using a combination of these senior and
junior credit facilities, supplemented with the continuously
available equity component, we believe we are well positioned to
capitalize on various immediately accretive strategic business
opportunities currently available to us in the marketplace."

Headquartered in Carencro, La., OMNI Energy Services Corp. offers
a broad range of integrated services to geophysical companies
engaged in the acquisition of on-shore seismic data and through
its aviation division, transportations services to oil and gas
companies operating in the shallow, offshore waters of the Gulf of
Mexico.  The company provides its services through two business
divisions: Seismic Drilling (including drilling, survey and
permitting services) and Environmental Services.  OMNI's services
play a significant role with geophysical companies who have
operations in marsh, swamp, shallow water and the U.S. Gulf Coast
also called transition zones and contiguous dry land areas also
called highland zones.

                        *     *     *

As reported in the Troubled Company Reporter on May 13, 2005, Omni
Energy Services Corp.'s independent registered public accounting
firm, Pannell Kerr Forster of Texas, P.C., questions the company's
ability to continue as a going concern after auditing the
Company's financial statements for the fiscal year ended Dec. 31,
2004.  The auditors point to the Company's significant operating
losses reported in fiscal 2004, the current default with respect
to certain Company debt, and a lack of external financing to fund
working capital and debt requirements.


PACEL CORP: Completes Debt Restructuring with Lenders
-----------------------------------------------------
PACEL Corp. (OTC Bulletin Board: PCCR) reported that it has
significantly restructured its debt obligation with its major
equity finance companies.

The Company says that Compass Capital, Reef Holdings Limited and
Kentan Limited have agreed to waive all discounts and excuse
existing and on- going interest on all outstanding loans.  PACEL
estimates this will save the company in excess of $350,000 during
the current fiscal year.

"The debt restructuring is a major step forward for PACEL," stated
Gary Musselman, President, "We will be able to use these saving to
continue to improve our bottom line.  This allows us to focus more
on building the company and growing for the future."

"We are pleased to help PACEL in this way," stated Mark Lefkowitz
of Compass Capital, "We have provided on-going financing to the
company and believe in the future of PACEL.  This debt
restructuring demonstrates our and the other funding organizations
commitment to helping the companies we work with succeed.  The
elimination of discounts and interest will greatly assist the long
term growth of the company and improve the value of the company to
its stockholders."

PACEL Corporation offers outsourced human resource services in
areas such as payroll, benefits, staffing, compensation,
recruiting, and retention.  The company serves as a Professional
Employer Organization for small to mid-size clients primarily in
the Southeastern US.  The company's stated strategy is to grow its
business process outsourcing services (including IT services,
financial services, and business development services) nationally
through acquisitions.  The company began its march on outsourced
human resources services with the acquisitions of Benecorp
(professional services firm) and Asmara (a PEO) in 2003.  Chairman
David Calkins founded PACEL in 1994.

At June 30, 2005, PACEL Corporation's balance sheet showed a
$6,004,731 stockholders' deficit, compared to a $3,976,348 deficit
at Dec. 31, 2004.


PANAMSAT HOLDING: Inks Pact to Merge with Intelsat for $3.2-Bil
---------------------------------------------------------------
Intelsat, Ltd., and PanAmSat Holding Corporation (NYSE: PA) signed
a definitive merger agreement under which Intelsat will acquire
PanAmSat for $25 per share in cash, or $3.2 billion.  The
transaction will create a premier satellite company that will be a
leader in the digital delivery of video content, the transmission
of corporate data and the provisioning of government
communications solutions.

The new company will offer its customers expanded coverage with
additional back-up satellites, supporting fiber networks and
enhanced operational capabilities for the provision of an
unparalleled level of services.  With an increased focus on
developing advanced communications technologies, the company will
meet the needs of cable TV programmers, broadcasters, businesses,
governments and consumers worldwide.

Using a combined fleet of 53 satellites, the company will serve
customers in more than 220 countries and territories.  Driven by
the core strengths of the two companies and their employees'
commitment to quality in operations and customer service, Intelsat
will have a portfolio of customers not only in the developed
world, but also in emerging nations and remote areas where
satellites are critical to providing communications infrastructure
for economic development.

"The combination of Intelsat and PanAmSat creates an industry
leader with the ability to provide competitive communications and
video services to consumers and businesses," said David McGlade,
Chief Executive Officer of Intelsat.  "The two companies are
complementary in customer, geographic and product focus.  
Together, we will continue providing the highest level of service
to existing customers while growing new business in rapidly
expanding communications markets."

Mr. McGlade will continue to serve as Chief Executive Officer and
a Director of the company upon closing.  Joseph Wright, currently
Chief Executive Officer of PanAmSat, is expected to become
Chairman of the Board upon completion of the transaction.

"Today, PanAmSat offers its video, data and government customers a
highly reliable level of service that only a technically advanced
and financially strong satellite operator can provide," said Mr.
Wright. "Now, we will combine the best from both companies and
bring a professional business approach to the new enterprise to
benefit our customers, employees and shareholders.  This is a
'win-win' for both companies, and a terrific outcome for all of
PanAmSat's shareholders, who will receive $25 per share in cash -
a significant premium over the recent stock price and nearly a 40%
premium over the IPO price of about six months ago.  In addition,
our shareholders will continue to receive dividends, at the
current annual rate or higher, until we close the transaction."

PanAmSat brings a strong, video-centric customer base, including
leading providers of cable TV programming, while Intelsat's
historical strength has been in providing core telephony and
advanced data services to developing and underserved regions
around the world.  Over the long term, the company will
consolidate best practices from the two respective organizations.  
"We will leverage our combined intellectual, material and people
assets to continue the high-quality service Intelsat and PanAmSat
customers have come to expect," said David McGlade.

Following the transaction, the company will have enhanced
financial strength and revenue and free cash flow growth
opportunities.  The company is expected to have pro forma annual
revenues of more than $1.9 billion and to maintain significant
free cash flow from operations, providing significant resources
for capital expenditures and debt service.

Under the agreement, which was approved unanimously by the Boards
of Directors of both companies, Intelsat will acquire all
outstanding common shares of PanAmSat, and additionally Intelsat
will either refinance or assume approximately $3.2 billion in debt
of PanAmSat Holding Corporation and its subsidiaries.  
Shareholders owning approximately 58% of PanAmSat's shares have
agreed to vote in favor of the combination.

                            Financing

Intelsat has received financing commitments for the full amount of
the purchase price from a group of financial institutions led by:

   * Deutsche Bank Securities Inc.,
   * Citigroup Global Markets Inc.,
   * Credit Suisse First Boston LLC, and
   * Lehman Brothers Inc.

A substantial portion of the financing for the transaction is
expected to be raised at Intelsat (Bermuda), Ltd., with additional
financing expected to be raised at PanAmSat Holding Corporation,
PanAmSat Corporation, and Intelsat Subsidiary Holding Company,
Ltd.  Prior to this financing and the closing of the transaction,
Intelsat (Bermuda), Ltd. is expected to transfer substantially all
of its assets and liabilities (including its 9-1/4% Senior
Discount Notes due 2015) to a newly formed wholly owned
subsidiary.  Upon completion of the transaction, both PanAmSat
Holding Corporation and Intelsat Subsidiary Holding Company, Ltd
will be direct or indirect wholly owned subsidiaries of Intelsat
(Bermuda), Ltd., and PanAmSat Holding Corporation and its
subsidiaries will continue as separate corporate entities.  The
transaction is expected to result in a Change of Control, as
defined in the indenture governing PanAmSat Holding Corporation's
outstanding bonds and certain of the indentures governing PanAmSat
Corporation's outstanding bonds.

The transaction is conditioned upon PanAmSat Holding Corporation
shareholder approval, customary closing conditions and clearances
from relevant regulatory agencies, including the appropriate U.S.
government antitrust authorities and the Federal Communications
Commission. The companies anticipate that the transaction could
close in approximately six to 12 months.

                          Professionals

Credit Suisse First Boston LLC is serving as Intelsat's financial
advisor, and Wachtell, Lipton, Rosen & Katz, Paul, Weiss, Rifkind,
Wharton & Garrison LLP, and Milbank, Tweed, Hadley & McCloy LLP
are serving as Intelsat's legal advisors.  Morgan Stanley is
serving as PanAmSat's financial advisor, and Simpson Thacher &
Bartlett LLP is serving as PanAmSat's legal advisor.

Intelsat, Ltd. offers telephony, corporate network, video and
Internet solutions around the globe via capacity on 25
geosynchronous satellites in prime orbital locations.  Customers
in approximately 200 countries rely on Intelsat's global
satellite, teleport and fiber network for high-quality
connections, global reach and reliability.

Through its owned and operated fleet of 25 satellites, PanAmSat
Holding Corp. (NYSE: PA) -- http://www.panamsat.com/-- is a  
leading global provider of video, broadcasting and network
distribution and delivery services.  It transmits 1,991 television
channels worldwide and, as such, is the leading carrier of
standard and high-definition signals.  In total, the Company's in-
orbit fleet is capable of reaching over 98 percent of the world's
population through cable television systems, broadcast affiliates,
direct-to-home operators, Internet service providers and
telecommunications companies.  In addition, PanAmSat supports
satellite-based business networks in the U.S., as well as
specialized communications services in remote areas throughout the
world.  

                         *     *     *

As reported in the Troubled Company Reporter on March 21, 2005,
Moody's Investors Service has upgraded the debt ratings for
PanAmSat Holding Corp. and its operating subsidiary, PanAmSat
Corporation concluding a review dated December 20, 2004.  This
review was precipitated by the company's announced intention to
complete a $900 million initial public equity offering, of which a
substantial portion was stated to be used to reduce debt.

The upgraded rating for PAS Holdings is:

   * $250 million of Senior Discount Notes to B3 from Caa1.

The upgraded ratings for PAS are:

   * Issuer rating to B1 from B2;

   * Senior implied rating to Ba3 from B1;

   * $2.3 billion senior secured bank facility to Ba3 from B1;

   * $150 million senior secured notes due 2008 to Ba3 from B1;

   * $125 million senior secured notes due 2028 to Ba3 from B1;
     and,

   * $656.5 million senior unsecured notes due 2014 to B1 from B2.

Moody's said the outlook for the ratings is stable.

As reported in the Troubled Company Reporter on Sept. 29, 2004,
Standard & Poor's Ratings Services assigned its 'B+' rating to the
$250 million senior discount notes due 2014 of PanAmSat Holding
Corp.  S&P said the outlook is stable.


PANAMSAT CORP: S&P Places BB Corporate Credit Rating on Watch
-------------------------------------------------------------
Standard & Poor's Ratings Services placed its ratings for Intelsat
Ltd. ('BB-' corporate credit rating) and PanAmSat Corp. ('BB') on
CreditWatch with negative implications.  The CreditWatch placement
follows the announcement of a definitive merger agreement between
Intelsat and PanAmSat Holding Corp., the parent of PanAmSat Corp.
An aggregate of nearly $8 billion in debt is affected.  Under
terms of the agreement, Intelsat will acquire PanAmSat Holding's
equity for $3.2 billion cash and will assume or refinance $3.2
billion in existing debt.
      
"The CreditWatch listing is based on the elevated financial risk
of the combined entity, which has an estimated (consolidated)
debt-to-EBITDA ratio in the mid-7x area, based on annualized
results for the first six months of 2005 (and assuming an all-debt
financing of the acquisition)," explained Standard & Poor's credit
analyst Eric Geil.  "We expect to resolve the CreditWatch listing
after reviewing the transaction financing plans and business
prospects for the combined company."
     
The merged company will have a combined fleet of 53 satellites,
making it the largest fixed satellite services operator.  The
resulting entity will benefit from PanAmSat's strong presence in
the North American video distribution market, in which expanding
high-definition TV services are bolstering transponder demand, and
Intelsat's good global presence.  The large fleet should improve
the combined company's satellite backup capabilities and
facilitate more efficient satellite capital expenditures.

Nevertheless, industry growth prospects are mature, contract
lengths are shortening, and newer managed services businesses
important to growth are less profitable than traditional
transponder leasing.  A meaningful portion of Intelsat's business
is from point-to-point carrier services, which are being
supplanted by fiber optic networks.


PEACE ARCH: Shareholders Okay Creation of Preference Shares
-----------------------------------------------------------
Peace Arch Entertainment Group Inc. (TSX:PAE)(AMEX:PAE) reported
the results of its Special Meeting of Holders of Common Shares,
held August 24, 2005.

At the Meeting, the shareholders approved the previously announced
resolutions presented to the Meeting by management.

In particular, the shareholders approved the amendment to the
Corporation's share capital by the creation of preference shares
issuable in series.  Among other things, this fulfills the
requirement of the Corporation to deliver voting preference shares
to Messrs. Drew Craig, Kerry McCluggage, Jeff Sagansky, and
Michael Taylor pursuant to the Corporation's previously announced
private placement of preference shares and warrants to those
individuals.

The shareholders also approved the reduction of the stated capital
account for the Corporation's common shares by up to
CDN$29,706,623.  This reduction will be applied to reduce the
Corporation's accumulated deficit under Canadian accounting
principles.  However, this reduction will not affect the
Corporation's financial statements under US accounting principles.

Based in Toronto, Vancouver, Los Angeles and London, England,
Peace Arch Entertainment Group Inc. -- http://www.peacearch.com--   
together with its subsidiaries, is an integrated company that
creates, develops, produces and distributes film, television and
video programming for worldwide markets.

                         *     *     *

                      Going Concern Doubt

As reported in the Troubled Company Reporter on April 14, 2005,
the company has undergone substantial financial restructuring and
requires additional financing until it can generate positive cash
flows from operations.  While the company continues to maintain
its day-to-day activities and produce films and television
programming, its working capital situation is severely
constrained.  Furthermore, the company operates in an industry
that has long operating cycles, which require cash injections into
new projects significantly ahead of the delivery and exploitation
of the final production.  These conditions cast substantial doubt
on the company's ability to continue as a going concern.

Equity has been reduced by 30% from a CDN$2,802,000 equity as of
Feb. 28, 2005, from a CDN$3,416,000 equity at Feb. 29, 2004.


PENINSULA HOLDING: Iskum Wants Stay Lifted to Effect Foreclosure
----------------------------------------------------------------
Iskum IX, LLC, a secured creditor of Peninsula Holding Company,
LLC, asks the U.S. Bankruptcy Court for the Western District of
Washington in Seattle, to lift the automatic stay under 11 U.S.C.
Section 362(d)(1) so it can schedule and conduct a foreclosure
sale of its collateral.  

Andrew A. Guy, Esq., at Stoel Rives LLP, tells the Bankruptcy
Court that The Confederated Tribes of the Grand Ronde Community of
Oregon obtained a judgment from the Mason Count Superior Court of
Washington, Case No. 03-2-0066-7, against Peninsula.  Iksum is the
successor-in-interest to that judgment.  

                             A Hoax

In 1992, The Confederated Tribes of the Grand Ronde Community of
Oregon hired Patrick Sizemore at Strategic Wealth Management to
serve as its primary financial and investment advisor.  

On May 18, 1999, Peninsula and one of its principals, Douglas A.
Brown, borrowed $10 million out of the Tribe's investment
portfolio to develop 809 acres of unimproved property located in
Shelton, Washington.  Patrick and his brother Mark Sizemore
assured the Tribe that, once developed, the property would have a
minimum sale value of $68,306,000.  Later that year, the Debtor
borrowed an additional $500,000 from the Tribe.

The Debtor and some of its principals signed a $10 million
promissory note in exchange for the first loan.  The note was
secured by a deed of trust against a property in Mason County.  
The note was due and payable on Nov. 30, 2000.  The Tribe also
received a promissory note in exchange for the second loan.  The
second note was secured by a security agreement granting an
interest in all plans, studies, appraisals, plat maps and drawings
and other development plans on the Shelton property.  

The Debtor defaulted on both loans.

In 2001, The Tribe discovered that its investment fund has been
mismanaged.  Mark Sizemore, Patrick's brother, and his company,
Paradigm Financial Services, Inc., played a major role in
mishandling the Tribe's investments.  

In addition, the Tribe found that:

   -- the Debtor and Patrick Sizemore failed to disclose that
      Peninsula Holding filed a chapter 11 bankruptcy petition
      (Bankr. W.D. Wash Case No. 99-05964);

   -- the loan was unauthorized by the Bankruptcy Court;

   -- Patrick Sizemore and Peninsula lied about the loan's
      purpose; they misrepresented that the loan was for
      refinancing when in fact it was to acquire the property;

   -- $700,000 of the loan proceeds went to Paradigm and $300,000
      went to the Debtor;

   -- the actual purchase price for the property was only
      $7 million;

   -- the property was in reality consisted of 672 acres, not 809
      acres as claimed by Mr. Sizemore and Peninsula; and

   -- Mr. Sizemore and the Debtor lied that there's a
      considerable interest in the property.

                         The Suit

In January 2003, the Tribe filed a complaint for Breach of
Promissory Notes and for Foreclosure of Deed of Trust and Personal
Property Security in the Mason Count Superior Court of Washington.  
On June 7, 2004, the State Court granted the Tribe a Partial Final
Money Judgment and Decree of Foreclosure against the Debtor and
its principals for $18,515,529 for the first note and $820,345 for
the second note.

The Tribe assigned its interest in the judgment to Iskum IX.

                        Failed Sale

For nearly nine months, Mr. Brown attempted to dispose of the
property but miserably failed.  PGP Valuation conducted an
appraisal of the property which resulted in a $7.4 million value.   
An updated opinion values the property at $3.7 million due to a
moratorium on commercial construction in the area where the land
is located.

                      Bankruptcy Filing

A day before the foreclosure sale ordered by the State Court on
May 20, 2005, Peninsula Holding filed for chapter 11 protection.  
As a result, the Shelton property was not put on sale and remains
in the possession of Peninsula Holding.

The total amount due on all liens against the property are:

                                        Amount
                                        ------
     Iskum IX, LLC Judgment Lien      $25,228,396
     Omni Financial Judgment Lien         502,687
     Real Property Taxes/Mason County       7,632
                                      -----------
                     Total            $25,738,716
     
Headquartered in Seattle, Washington, Peninsula Holding Company
LLC, develops raw land projects in Shelton, Washington.  The
Company filed for chapter 11 protection on May 19, 2005 (Bankr.
W.D. Wash. Case No. 05-16571). Charles A. Johnson, Jr., Esq., at
the Law Offices of Charlie Johnson, represents the Debtor in its
restructuring efforts.  When the Debtor filed for protection from
its creditors, it listed total assets of $42,900,000 and total
debts of $31,432,554.


PEREGRINE SYSTEMS: Distributing Stock Reserve to Ex-Stockholders
----------------------------------------------------------------
Peregrine Systems, Inc. (OTC: PRGN) is distributing the 600,000
shares of common stock held in the New PSI Common Stock Reserve
established under its Fourth Amended Plan of Reorganization to
certain former stockholders who were holders of Class 9 claims
under the plan.

"The stock distribution we are announcing today is a highly
positive milestone for the company as it signals resolution of
almost all of the general expense claims against the company under
our plan of reorganization," said Kevin Courtois, Peregrine
general counsel.  "Resolution of these claims now enables us to
distribute these shares to certain former shareholders under a
formula approved as part of the plan."

                  New PSI Common Stock Reserve

The reserve was established under the plan to hold these shares
pending the resolution of Class 8 general expense claims.  The
plan requires these shares to be allocated either to former
bondholders, who were holders of Class 7 claims under the plan, or
to certain former stockholders who were holders of Class 9 claims,
or some combination, according to a formula.  The formula
allocates the shares based on whether the amount finally paid to
resolve Class 8 general expense claims falls below, within, or
above the range of $49 million to $65 million, the range of
estimates for resolving the Class 8 general expense claims by the
various participants in the bankruptcy proceedings.

Peregrine resolved these Class 8 general expense claims by paying
or agreeing to pay over time approximately $45 million, with
approximately $600,000 in Class 8 claims remaining to be resolved.  
Because the final payout on Class 8 claims will be below $49
million, the reserve shares will be allocated to certain former
stockholders who were holders of Class 9 claims.

                         Background

Under its plan of reorganization, Peregrine issued a total of
15,000,000 shares of new common stock in exchange for the
cancellation of its old common stock and in addition to other
consideration provided to certain creditors.  Former holders of
Peregrine's 5-1/2 percent convertible subordinated notes due 2007
as of the plan effective date, Aug. 7, 2003, classified as holders
of Class 7 claims, received 9,450,000 shares, or 63 percent, of
the new common stock.

Of the remaining shares, 4,950,000, or 33 percent of the total,
were required to be allocated to holders of Class 9 claims,
comprising holders of Peregrine's old common stock as of the plan
effective date (Equity Class), persons who bought Peregrine's old
common stock from July 22, 1999 through May 3, 2002, and joined a
class bringing securities claims against Peregrine (Securities
Class), and certain other subordinated claimants (Indemnification
Class).

Following a settlement among the holders of Class 9 claims
approved by the bankruptcy court on Nov. 12, 2003:

    * 4,016,250 shares of new common stock were distributed in
      December 2003 to persons in the Equity Class, who were
      entitled to receive one share of new common stock for every
      48.7548 shares of old common stock previously held;

    * 708,750 shares were distributed in December 2003 to the
      trustee of the Peregrine Litigation Trust on behalf of the
      Securities Class.  The Litigation Trust was established
      under the plan to succeed, with certain exceptions, to
      Peregrine's causes of action against certain third parties,
      including former directors and officers of Peregrine; and

    * 225,000 shares are to be allocated by later agreement or
      bankruptcy court order among members of the Indemnification
      Class.

The remaining 600,000 shares of new common stock (New PSI Common
Stock Reserve), representing four percent of the total, were held
in reserve by Peregrine as the stock disbursing agent under the
plan for later distribution to either the holders of Class 7
claims or certain of the holders of Class 9 claims, or both,
according to a formula.  As described above, the formula allocates
the shares based on whether the amount finally paid to resolve
Class 8 general expense claims falls below, within, or above the
range of $49 million to $65 million.

Under the Class 9 settlement order, if the New PSI Common Stock
Reserve shares are distributed to holders of Class 9 claims, they
are to be distributed 85 percent to the Equity Class and 15
percent to the Litigation Trust trustee for the benefit of the
Securities Class.  In the settlement, the Equity Class and the
Indemnification Class waived any right to cash proceeds from the
Litigation Trust.  As a result, the Securities Class is entitled
to receive 100 percent of any Litigation Trust proceeds.

            Resolution of Class 8 General Expense Claims
          and Distribution of New PSI Common Stock Reserve

Peregrine has now resolved Class 8 general unsecured claims by
paying or agreeing to pay over time approximately $45 million,
with approximately $0.6 million in Class 8 general expense claims
remaining to be resolved.  As a result, Peregrine has determined
that the amount finally paid to resolve Class 8 general expense
claims will fall below $49 million and, therefore, all New PSI
Common Stock Reserve shares are required to be distributed as
additional shares to certain of its former stockholders that were
holders of Class 9 claims.  Accordingly,

    * 90,000 shares (15 percent) of new common stock are being
      issued to Robert C. Friese, Litigation Trust trustee, for
      the benefit of the Securities Class; and

    * 510,000 shares (85 percent) of new common stock are being
      issued to the Equity Class.  Using a record date of Aug. 7,
      2003, for old common stock, Peregrine will issue this
      additional new common stock at a ratio of 1 share of new
      common stock for every 383.944 shares of old common stock
      previously held.  Pursuant to the terms of the plan,
      fractional shares resulting from the 1-for-383.944 exchange
      ratio will be rounded down to the nearest whole share amount
      and no cash will be paid in lieu of fractional shares.

Former Peregrine stockholders as of Aug. 7, 2003, that may be
entitled to receive shares of new common in the distribution do
not need to take any action to receive their new shares.  If
shares of old common stock were held in the stockholder's name
with Peregrine's transfer agent, Mellon Investor Services, any
shares of new common stock to which the stockholder may be
entitled will automatically be registered in the stockholder's
name and recorded electronically by Mellon.  If shares of old
common stock were held through a broker or other nominee, any
shares of new common stock to which the stockholder may be
entitled will be automatically distributed by Mellon to the broker
or other nominee.  These stockholders should contact their broker
or other nominee directly to confirm delivery of shares.

Current or former stockholders requiring additional assistance may
contact Heidi Flannery, FI.COMM Financial Communications,
Peregrine's investor relations firm, at (503) 203-8808.  Brokers
should refer to the NASDAQ Uniform Practice Advisory (UPC #013-
2004) dated Jan. 27, 2004, regarding Peregrine's original
distribution of new common stock under its plan.

Headquartered in San Diego, Calif., Peregrine Systems, Inc. --
http://www.peregrine.com/-- is a global provider of enterprise  
software to enable leading companies to optimally manage the IT
infrastructure.  The company's flagship product suites --
ServiceCenter(R) and AssetCenter(R) -- create a foundation for IT
asset and service management solutions based on industry best
practices, including ITIL (IT Infrastructure Library).  In
addition, customers use Peregrine's Configuration Services suite
to gain an accurate, consolidated view of their IT assets.  
Peregrine recently introduced a new vision -- Optimal IT -- to
deliver predictive analytics and decision modeling to optimize IT
performance.  The company conducts business from offices in the
Americas, Europe and Asia Pacific.

The Company filed a voluntary Chapter 11 petition on Sept. 22,
2002. On Aug. 7, 2003, Peregrine became the first public
enterprise software company to successfully restructure under
Chapter 11 protection.


PHARMACEUTICAL FORMULATIONS: Hires Young Conaway as Counsel
-----------------------------------------------------------
Pharmaceutical Formulations, Inc., sought and obtained permission
from the U.S. Bankruptcy Court for the District of Delaware to
employ Young Conaway Stargatt & Taylor, LLP, as its bankruptcy
counsel, nunc pro tunc to July 11, 2005.

Pharmaceutical Formulations hired Young Conaway because of the
Firm's professionals' extensive experience and knowledge in the
field of debtors' and creditors' rights and business
reorganizations under chapter 11.

Young Conaway will:

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

   b) prepare and pursue confirmation of a plan and approval of a
      disclosure statement;

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

   d) appear in Court to protect the interests of the Debtor; and

   e) perform all other legal services for the Debtor which are
      necessary and proper in this proceeding.

The principal attorneys and other professionals who will represent
the Debtor and their current hourly rates are:

      Professional                       Rate
      ------------                       ----
      Brendan Linehan Shannon, Esq.      $460
      Michael R. Nestor, Esq.            $420
      Matthew B. Lunn, Esq.              $285
      Donald J. Bowman, Jr., Esq.        $235
      Debbie Laskin                      $175
     
To the best of the Debtor's knowledge, Young Conaway is
disinterested as that term is defined in Section 101(14) of the
Bankruptcy Code.

Headquartered in Edison, New Jersey, Pharmaceutical Formulations,
Inc. -- http://www.pfiotc.com/-- is a publicly traded private   
label manufacturer and distributor of nonprescription over-the-
counter solid dose generic pharmaceutical products in the United
States.  The Company filed for chapter 11 protection on July 11,
2005 (Bankr. Del. Case No. 05-11910).   As of Apr. 30, 2005, the
Debtor reported $40,860,000 in total assets and $44,195,000 in
total debts.


PHARMACEUTICAL FORMULATIONS: UST Picks 7-Member Creditors Panel
---------------------------------------------------------------
The United States Trustee for Region 3 appointed seven creditors
to serve on an Official Committee of Unsecured Creditors in
Pharmaceutical Formulations, Inc.'s chapter 11 case:

   1. Broadway Management
      Attn: Richard H. Kaplan, Esq.
      460 Plainfield Avenue Associates, L.P.
      80 Broad Street, 29th Floor
      New York, NY 10004
      Tel: (212) 493-7000
      Fax: (212) 493-7032

   2. Albemarle Corporation
      Attn: Scott Martin
      451 Florida Street
      Baton Rouge, LA 70801
      Tel: (225) 388-7462
      Fax: (225) 388-7603

   3. Innovative Folding Carton Co., Inc.  
      Attn: Robert A. St. Pierre
      901 Durham Avenue
      S. Plainfield, NJ 07080
      Tel: (908) 757-6000 Ext. 118
      Fax: (908)757-1340

   4. Unite d Teamster Fund  
      Attn: Richard Hart
      2137 Utica Avenue
      Brooklyn, NY 11234
      Tel: (718) 859-1624
      Fax: (718) 943-0159

   5. Penn Bottle & Supply Co.
      Attn: Anthony I Dintino
      710 E. Third Street
      Essington, PA 19029
      Tel: (610) 521-6000
      Fax: (610) 521-7200

   6. Colorcon Division of Berwind Pharmaceutical
      Attn: John T. Fry
      415 Moyer Boulevard
      P.O. Box 24
      West Point, PA 19486
      Tel: (215) 661-2610
      Fax: (215) 661-2210

   7. Blanver
      Attn: Stephanie Hodgson
      777 Yamato Road, Suite 116
      Boca Raton, FL 33431
      Tel: (561) 862-0004
      Fax:(561) 862-0879

Official creditors' committees have the right to employ legal and
accounting professionals and financial advisors, at the Debtors'
expense.  They may investigate the Debtors' business and financial
affairs.  Importantly, official committees serve as fiduciaries to
the general population of creditors they represent.  Those
committees will also attempt to negotiate the terms of a
consensual chapter 11 plan -- almost always subject to the terms
of strict confidentiality agreements with the Debtor and other
core parties-in-interest.  If negotiations break down, the
Committee may ask the Bankruptcy Court to replace management with
an independent trustee.  If the Committee concludes reorganization
of the Debtors is impossible, the Committee will urge the
Bankruptcy Court to convert the chapter 11 cases to a liquidation
proceeding.

Headquartered in Edison, New Jersey, Pharmaceutical Formulations,
Inc. -- http://www.pfiotc.com/-- is a publicly traded private   
label manufacturer and distributor of nonprescription over-the-
counter solid dose generic pharmaceutical products in the United
States.  The Company filed for chapter 11 protection on July 11,
2005 (Bankr. Del. Case No. 05-11910).  Matthew Barry Lunn, Esq.,
and Michael R. Nestor, Esq., at Young Conaway Stargatt & Taylor
LLP, represent the Debtor in its chapter 11 proceeding.  As of
Apr. 30, 2005, the Debtor reported $40,860,000 in total assets and
$44,195,000 in total debts.


PER-SE TECHNOLOGIES: S&P Puts B+ Corporate Credit Rating on Watch
-----------------------------------------------------------------
Standard & Poor's Ratings Services placed its 'B+' corporate
credit and other ratings on Atlanta, Georgia-based Per-Se
Technologies Inc. on CreditWatch with negative implications
following Per-Se's announcement that it will acquire NDCHealth
Corp. for about $1 billion, including the assumption of
NDCHealth's debt.
     
The 'B' corporate credit and other ratings on NDCHealth were
affirmed.  Upon completion of the transaction, ratings on
NDCHealth will be withdrawn as Per-Se intends to refinance its
obligations.
     
As part of the transaction, Wolters Kluwer N.V. (BBB+/Stable/A-2),
based in Amsterdam, the Netherlands, will purchase NDCHealth's
pharmaceutical information management business, which represented
about one third of the company's revenues and operating income,
for $382 million in cash.  Per-Se will retain the physician,
hospital, and retail pharmacy businesses.  Total consideration
paid to NDCHealth shareholders will be $19.50 per share, with at
least $13.00 paid in cash and up to $6.50 paid in Per-Se stock.
Per-Se has the option to increase the cash portion of the purchase
price at its discretion.
     
The combination of the two businesses is seen as modestly
positive.  While both companies focus on health care reimbursement
procedures, markets and applications are complementary, providing
marketing synergies and broader coverage.  Some infrastructure
cost savings are expected as the companies merge.
     
Based on Per-Se's intent to pay $13.00 per share, the company
anticipates a funding need of about $410 million in order to
complete the acquisition and to refinance NDCHealth's debt.  "If
the acquisition is completed using this financing structure, the
ratings would likely be affirmed at 'B+', with a negative outlook,
reflecting a strengthened business profile, but increased leverage
and integration risks," said Standard & Poor's credit analyst Lucy
Patricola.
     
Should Per-Se elect to pay more in cash than the $13.00 per share
currently contemplated, debt levels may increase further.  A fully
debt-financed transaction would increase leverage to over 6x and
would likely result in lowering of the corporate credit rating to
'B'.
     
Standard & Poor's will monitor developments with respect to the
transaction and will meet with management to discuss final
financing arrangements to resolve the CreditWatch listing.


PREMIER ENTERTAINMENT: S&P Puts Corporate Credit Rating on Watch
----------------------------------------------------------------
Standard & Poor's Ratings Services placed its 'B-' corporate
credit and senior secured ratings on Premier Entertainment Biloxi
LLC on CreditWatch with negative implications.  Premier is the
entity formed to construct a 'Hard Rock'-themed casino resort
along the Mississippi Gulf Coast in Biloxi, Mississippi.
      
"Given that the grand opening of this property was anticipated to
occur sometime in September 2005, the CreditWatch listing follows
the potential for significant damage to the property from
Hurricane Katrina, as well as the potential that the opening will
be delayed," said Standard & Poor's credit analyst Emile Courtney.

In resolving the CreditWatch listing, Standard & Poor's will
assess the impact of any damages and the intermediate prospects
for the Biloxi market.  In addition, S&P will assess potential
liquidity issues that may arise from a delayed or soft opening.


PROXIM CORP: Asks Court to Set September 30 as Claims Bar Date
--------------------------------------------------------------
Proxim Corporation and its debtor-affiliates ask the U.S.
Bankruptcy Court for the District of Delaware to set Sept. 30,
2005, as the deadline for all creditors owed money by the Debtors
on accounts arising prior to June 11, 2005, to file their proofs
of claim.  The Debtors also want the Court to set Dec. 8, 2005, as
the deadline for all governmental units to file their proofs of
claim.

The Debtors tell the Bankruptcy Court that they've started
drafting a liquidation plan.  Bar dates are necessary, the Debtors
say, to quantify prepetition claims against their estates.

All proofs of claim must be delivered to:

      The Clerk of the U.S. Bankruptcy Court
      District of Delaware
      824 Market Street, 3rd Fl.
      Wilmington, DE 19801

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.


RESCARE INC: Buying Back 10-5/8% Senior Notes Until Sept. 27
------------------------------------------------------------
ResCare, Inc. (NASDAQ/NM:RSCR) commenced a tender offer to
purchase any and all of its outstanding 10-5/8% Senior Notes due
2008, as well as a related consent solicitation to amend the Notes
and the indenture pursuant to which they were issued.  The consent
solicitation will expire at 5:00 p.m., New York City time, on
Monday, Sept. 12, 2005, unless extended.  Tendered Notes may not
be withdrawn and consents may not be revoked after the Consent
Date.  The tender offer will expire at 5:00 p.m., New York City
time, on Tuesday, September 27, 2005, unless extended by ResCare.

The total consideration for each $1,000 principal amount of Notes
validly tendered on or before the Consent Date pursuant to the
Offer will be equal to:

    (i) the present value (determined in accordance with standard
        market practice) on a date promptly following the tender
        offer expiration date, of $1,053.13 per $1,000 principal
        amount of Notes on the earliest redemption date, November
        15, 2005, plus the present value of all future interest
        payments payable from the last interest payment date up to
        the earliest redemption date, determined on the basis of a
        yield to the earliest redemption date equal to the sum of:

         (x) the yield on the 1.625% U.S. Treasury Note due
             October 31, 2005, as calculated by the Dealer
             Managers and Solicitation Agents in accordance with
             standard market practice, based on the bid price for
             such reference security as of 2:00 p.m., New York
             City time, on the second business day immediately
             preceding the tender offer expiration date, as
             displayed on the Bloomberg Government Pricing Monitor
             on "Page PX3" or any recognized quotation source
             selected by the Dealer Managers and Solicitation
             Agents in their sole discretion, plus

         (y) 50 basis points (such price being rounded to the
             nearest $0.01 per $1,000 principal amount of Notes),
             minus

   (ii) accrued and unpaid interest from the last interest payment
        date to, but not including, the date of payment.

All holders whose Notes are accepted for purchase will also be
paid accrued and unpaid interest.

The Company will make a consent payment of $20.00 per $1,000
principal amount of the Notes for which Notes have been tendered
and consents have been validly delivered on or prior to the
Consent Date.  The Consent Payment is included in Total
Consideration.  Holders who validly tender their Notes after the
Consent Date but prior to the Expiration Date will be eligible to
receive only the Tender Offer Consideration, which equals the
Total Consideration less the Consent Payment.  The Company may
amend, extend or terminate the tender offer and consent
solicitation at any time.

Holders who validly tender their Notes will also be consenting to
proposed amendments to the indenture governing the Notes that
would eliminate certain restrictive covenants and other
provisions.  The consummation of the tender is subject to the
receipt of consents to the proposed amendments to the indenture,
ResCare's consummation of refinancing transactions, and other
customary conditions.  Holders may not tender their Notes without
also delivering consents or deliver consents without also
tendering their Notes.

J.P. Morgan Securities Inc. and Goldman, Sachs & Co. are the
Dealer Managers and Solicitation Agents for the tender offer and
the consent solicitation.  The depositary is Computershare Trust
Company of New York, and the information agent is Georgeson
Shareholder Communications, Inc. Questions or requests for
assistance may be directed to J.P. Morgan Securities Inc.
(Telephone: (212) 834-3424 (collect) or (866) 834-4666 (toll
free)) or to Goldman, Sachs & Co. (Telephone: (212) 357-8664
(collect) or (800) 828-3182 (toll free)) or to Georgeson
Shareholder Communications, Inc. (telephone: (866) 328-5439).

This release is for informational purposes only and is neither an
offer to purchase nor a solicitation of an offer to sell the
Notes.  The offer to buy the Notes is only being made pursuant to
the tender offer and consent solicitation documents, including the
Offer to Purchase and Consent Solicitation Statement that ResCare
is distributing to holders of the Notes.  The tender offer and
consent solicitation is not being made to holders of Notes in any
jurisdiction in which the making or acceptance thereof would not
be in compliance with the securities, blue sky or other laws of
such jurisdiction.  In any jurisdiction in which the tender offer
or consent solicitation is required to be made by a licensed
broker or dealer, they shall be deemed to be made by J.P. Morgan
Securities Inc. and Goldman, Sachs & Co. on behalf of ResCare.

ResCare Inc., -- http://www.rescare.com/-- founded in 1974,  
offers services to some 41,000 people in 34 states, Washington,
DC, Puerto Rico and Canada.  ResCare is a human service company
that provides residential, therapeutic, job training and
educational supports to people with developmental or other
disabilities, to youth with special needs and to adults who are
experiencing barriers to employment.  The Company is based in
Louisville, Kentucky.

                       *     *     *

The Company's 10-5/8% senior notes due 2008 carry Moody's
Investors Service's B2 rating and Standard & Poor's B rating.


SAKS INC: Gets Offers for Units as Whole Business Gets Snubbed
--------------------------------------------------------------
Saks Inc. received bids for certain of its units as the bidding
process closed last week.  Nobody offered to buy the whole
business.

Women's Wear Daily reported that the Company received offers from

      * Too Inc.,
      * Claire's Stores, and
      * Build-a-Bear,

for its Club Libby Lu unit.

Bon-Ton Stores Inc. expressed interest in Saks' department store
division, which includes Bergner's, Boston Store, Carson Pirie
Scott, Herberger's, and Younkers chains.

Saks Inc.'s share price steadily increased from a $17 per share
level in June to the $24 per share level before the bidding
process closed.  Share price fell to a $21 per share level after
all the bids were in.

Saks Incorporated is a top US department store operator, with more
than 300 stores in 40 US states.  Most of its stores are regional
chains concentrated in the Southeast and Midwest, including
Parisian, Younkers, Carson Pirie Scott, Herberger's, Boston Store,
and Bergner's.

                          *     *     *

As reported in the Troubled Company Reporter on Aug. 8, 2005,  
Moody's Investors Service changed the direction of Saks Inc.
review to on review for possible upgrade from on review for
possible downgrade as a result of the company effectively curing
the defaults triggered by its failure to timely file its fiscal
year end financial statements, as well as its improved liquidity
as a result of a significant asset sale:

   * Corporate family of B2;

   * Senior unsecured debt guaranteed by operating
     subsidiaries of B2;

As reported in the Troubled Company Reporter on July 22, 2005,  
Standard & Poor's Ratings Services raised its corporate credit and
senior unsecured debt ratings on Saks Inc. to 'B+' from 'CCC+' to
reflect the successful completion of a tender offer that reduced
debt by $585 million.  The ratings remain on CreditWatch with
developing implications.


SALTON INC: Completes Private Debt Exchange Offer
-------------------------------------------------
Salton, Inc. (NYSE: SFP) successfully completed its previously
announced private debt exchange offer for its outstanding 10-3/4%
Senior Subordinated Notes due 2005 and its outstanding 12-1/4%
Senior Subordinated notes due 2008.  The Company has accepted for
exchange an aggregate of approximately $75.2 million of 2005 Notes
(60.1% of the outstanding 2005 Notes) and approximately $90.1
million of 2008 Notes (60.1% of the outstanding 2008 Notes) that
were validly tendered in the exchange offer.

In connection with the exchange offer, the Company has issued an
aggregate of approximately $99.2 million in principal amount of
new second lien notes, 2,041,617 shares of common stock of the
Company and 135,230 shares of new Series C preferred stock of the
Company with a face amount equal to $13.5 million.  The second
lien notes mature on March 31, 2008 and bear interest at LIBOR
plus 7%.  The Series C preferred stock is generally non-dividend
bearing and is redeemable by the Company at the face amount on the
fifth anniversary of the issuance date.

The Company also said that, in connection with the exchange offer,
the Company obtained the consent of the holders of a majority of
the outstanding 2005 Notes and 2008 Notes to amend the indentures
governing such Notes to eliminate substantially all of the
restrictive covenants and certain events of default contained in
such indentures.  The Company has entered into supplements to the
indentures governing the 2005 Notes and the 2008 Notes to reflect
such amendments.

"This transaction reduces our total interest bearing debt by
approximately $66.1 million and decreases by $75.2 million the
principal amount of 2005 Notes that are scheduled to mature this
year.  The successful results of this private debt exchange offer
is a significant step in our plans to improve liquidity and
strengthen our balance sheet, which will ultimately provide us
with the operating flexibility to pursue growth initiatives," said
Leonhard Dreimann, Salton's chief executive officer.  "We continue
to explore strategic options to improve our liquidity and enhance
operating performance of the Company, including potential sales of
assets or businesses, the creation of new foreign debt,
repurchases of outstanding debt securities and further reductions
in expenses."

None of the securities issued in connection with the exchange
offer have been registered under the Securities Act of 1933, as
amended, or any state securities laws and unless so registered may
not be offered or sold in the United States except pursuant to an
exemption from, or in a transaction not subject to, the
registration requirements of the Securities Act and applicable
securities laws.

Salton, Inc. is a leading designer, marketer and distributor of
branded, high-quality small appliances, electronics, home decor
and personal care products.  Its product mix includes a broad
range of small kitchen and home appliances, electronics for the
home, tabletop products, time products, lighting products, picture
frames and personal care and wellness products.  The company sells
its products under a portfolio of well recognized brand names such
as Salton(R), George Foreman(R), Westinghouse (TM),
Toastmaster(R), Mellitta(R), Russell Hobbs(R), Farberware(R),
Ingraham(R) and Stiffel(R).  It believes its strong market
position results from its well-known brand names, high-quality and
innovative products, strong relationships with its customer base
and its focused outsourcing strategy.

                          *     *     *

The Company's 10-3/4% Senior Subordinated Notes due 2005 carry
Moody's Investors Service's junk ratings.


SALTON INC: Raises $80 Mil. from Sale of South African Interest
---------------------------------------------------------------
Salton, Inc. (NYSE: SFP) entered into a definitive agreement to
sell its 52.6% ownership interest in Amalgamated Appliance
Holdings Limited ("AMAP") to a group of investors led by
Interactive Capital (Proprietary) Limited.  The Company expects to
receive net of expenses proceeds of approximately $80 million in
connection with the transaction.  The closing, which is subject to
certain conditions, is expected to occur in September.

"The successful debt exchange offer we announced today has allowed
us to pursue initiatives, such as the sale of our ownership
interest in AMAP, to increase our financial flexibility," said
Leonhard Dreimann, chief executive officer of Salton.  "We will
continue to aggressively explore other ways to improve our
liquidity.  While AMAP has been a great investment for Salton and
continues to be a leading distributor and marketer of small
appliances and other products in South Africa, the sale of our
ownership interest will not end our relationship.  We expect to
continue to work closely with AMAP, which will continue to license
and sell our George Foreman(R), Russel Hobbs(R) and Carmen(R)
branded products in South Africa."

Salton, Inc. is a leading designer, marketer and distributor of
branded, high quality small appliances, electronics, home decor
and personal care products. Its product mix includes a broad range
of small kitchen and home appliances, electronics for the home,
tabletop products, time products, lighting products, picture
frames and personal care and wellness products. The company sells
its products under a portfolio of well recognized brand names such
as Salton(R), George Foreman(R), Westinghouse (TM),
Toastmaster(R), Mellitta(R), Russell Hobbs(R), Farberware(R),
Ingraham(R) and Stiffel(R). It believes its strong market position
results from its well-known brand names, high quality and
innovative products, strong relationships with its customers base
and its focused outsourcing strategy.

                          *     *     *

The Company's 10-3/4% Senior Subordinated Notes due 2005 carry
Moody's Investors Service's junk ratings.


SERVICE CORPORATION: Reports Preliminary Results for 2nd Quarter
----------------------------------------------------------------
Service Corporation International (NYSE: SCI) reported preliminary
second quarter earnings.  

SCI preliminarily reported net income for the second quarter 2005
of $14.0 million compared to net income of $43.0 million in the
same period of 2004.  For the first six months of 2005, the
Company preliminarily reported a net loss of $141.4 million
compared to net income of $72.8 million in the same period of
2004.  All of the above results included litigation expenses,
gains and impairment losses on dispositions, early extinguishments
of debt, discontinued operations and cumulative effects of
accounting changes.

SCI's preliminary second quarter 2005 earnings from continuing
operations excluding special items were $22.1 million which
compared to $16.7 million in the second quarter of 2004.
Preliminary earnings from continuing operations excluding special
items in the first half of 2005 were $59.8 million compared to
$62.1 million in the first half of 2004.  Preliminary earnings
from continuing operations excluding special items in the first
half of 2005 were negatively impacted by $.02 per diluted share as
a result of the Company's first quarter 2005 change in accounting
to expense direct preneed selling costs as they are incurred.

At June 30, 2005, total debt was $1.26 billion and cash on hand
was $320.0 million, which resulted in net debt (which the Company
defines as total debt less cash on hand) of $943.3 million at June
30, 2005 compared to $966.2 million at December 31, 2004.  Free
cash flow was $62.1 million for the second quarter of 2005, an
increase of $36.7 million over the same period of 2004.  In the
first half of 2005, free cash flow was $147.0 million compared to
$120.5 million in the same period of 2004 and is on target to meet
our expectations of $200 million to $220 million for the year.

"I am pleased with our second quarter performance as our North
America comparable funeral and cemetery gross profits grew
approximately 6% and 30%, respectively," said Tom Ryan, President
and Chief Executive Officer.  "We believe our performance in the
first half of 2005 is on pace to meet our annual forecast.  As a
result, we confirm our annual guidance for 2005 for diluted
earnings per share from continuing operations excluding special
items given in April of this year.  Free cash flow generated in
the first six months of 2005 was strong and our cash on hand is
currently over $350 million.  This financial flexibility has
allowed us to continue to deliver shareholder value as evidenced
by the previously announced expansion of our share repurchase
program.  For the remainder of 2005, we will continue to focus our
efforts on developing institutional excellence throughout the
organization and maintaining our focus on reducing our overall
cost structure."

                     Share Repurchase Program

In June 2005, the Company announced an increase of $100 million in
its authorization to repurchase the Company's common stock, which
brought the total authorization to $400 million including the
previously announced authorizations in August and November of 2004
and February of 2005.  As of Aug. 29, 2005, the Company has
repurchased 43.6 million shares at a total cost of $301.5 million
under these programs and the remaining dollar value of shares that
may be purchased under its share repurchase programs is $98.5
million.  The Company's total shares outstanding are approximately
298.1 million as of August 29, 2005.

The Company intends to make purchases from time to time in the
open market or through privately negotiated transactions, subject
to acceptable market conditions and normal trading restrictions.
There can be no assurance that the Company will buy its common
stock under the share repurchase programs.  Important factors that
could cause the Company not to repurchase its shares include,
among others, unfavorable market conditions, the market price of
its common stock, the nature of other investment opportunities
presented to the Company from time to time, and the availability
of funds necessary to continue purchasing common stock.

Headquartered in Houston, Texas, Service Corporation International  
-- http://www.sci-corp.com/-- owns and operates funeral homes and  
cemeteries.  The Company has an extensive network of businesses
including 1,126 funeral service locations and 388 cemeteries in  
North America as of June 30, 2005.  

                        *     *     *

As reported in the Troubled Company Reporter on June 10, 2005,  
Moody's Investors Service assigned a Ba3 rating to Service
Corporation International's proposed $300 million of senior notes,
affirmed existing ratings and maintained a stable rating outlook.


SERVICE CORP: To Restate Previously Issued Financial Statements
---------------------------------------------------------------
Service Corporation International (NYSE: SCI) said that it would
be restating financial results for:

    * the first interim period of 2005,
    * each of the five years ended December 31, 2004, and
    * each of the interim periods of 2004 and 2003.

As a result, the Company's previously issued financial statements
for these periods should not be relied on.

This restatement is primarily related to:

    (1) the Company's review of the reconciliations that were
        performed to reconcile its preneed funeral and cemetery
        trust accounts,

    (2) preneed funeral trust income that was previously
        understated as a result of a point- of-sale system error,

    (3) a loss on a property disposition recognized in April 2005
        which should have been recognized in the Company's first
        quarter 2005 consolidated financial statements, and

    (4) other adjustments including an impairment of covenant-not-
        to-compete agreements which should have been recognized in
        the Company's 2002 consolidated financial statements.

Also included in this restatement are previously reflected
adjustments to consolidated financial statements issued prior to
January 1, 2004, which relate to deferred cemetery contract
revenues, operating leases, and other reconciliation projects.

Management has concluded the effect of the above adjustments on
its previously issued financial statements is not material to any
of these prior periods, however, the aggregate impact of these
adjustments ($10.0 million charge to pretax income) is material to
the Company's second quarter 2005 financial statements and,
therefore, has led to the restatement of the previously issued
financial statements.  The $10.0 million of aggregate adjustments
is preliminary and is subject to change pending the completion and
review of certain procedures being performed by the Company and
review by its independent auditor.

Headquartered in Houston, Texas, Service Corporation International  
-- http://www.sci-corp.com/-- owns and operates funeral homes and  
cemeteries.  The Company has an extensive network of businesses
including 1,126 funeral service locations and 388 cemeteries in  
North America as of June 30, 2005.  

                        *     *     *

As reported in the Troubled Company Reporter on June 10, 2005,  
Moody's Investors Service assigned a Ba3 rating to Service
Corporation International's proposed $300 million of senior notes,
affirmed existing ratings and maintained a stable rating outlook.


SONORAN ENERGY: Working Capital Deficit Cues Going Concern Doubt
----------------------------------------------------------------
Epstein Weber & Conover, PLC, expressed substantial doubt about
Sonoran Energy, Inc.'s ability to continue as a going concern
after it audited the Company's financial statements for the year
ended April 30, 2005.  The auditing firm points to the Company's
significant losses since inception and working capital deficit.

The Company however believes that it will be able to source
sufficient funds to develop its existing current assets and
planned acquisitions so that these operations will be sufficient
to fund the anticipated liquidity and capital resource needs of
the Company for the fiscal year ended April 30, 2006.  At the
present time, Management feels that there are opportunities to
enhance existing wells and discussions have been held regarding
efforts to tap into possible reserves on the oil properties.

The Company had cash and cash equivalents of $62,313 at April 30,
2005 for an increase of $29,004 when compared to April 30, 2004.
Net capital spending of $ 1,736,188 used cash in 2005.  This was
partially offset by proceeds from a convertible note of
$1,680,000.  Adequate funds were available to carry out all cash
calls the Company chose to participate in.

The Company reported a net loss of $7,429,471 at April 30, 2005
compared to a net loss of $4,829,250 at April 20, 2004.  Working
capital deficit at April 30, 2005 was $4,031,271.

Revenue increased to $518,711 for the year ended April 30, 2005
from the $291,297 revenue for the year ended April 30, 2004.  The
increase in revenue reflects the acquisitions of the East Texas
interests during November 2004 compared to the revenue from the
assets disposed of in January 2004.  The fields operated in 2005
constitute a completely different asset base than those operated
in 2004 except for the Louisiana properties, which the Company
acquired in January 2004.

The Company's continuation as a going concern is dependent upon
its ability to secure profitable interests in oil and gas
projects.  Further, the Company is dependent upon management's
ability to produce sufficient cash flow that is required to meet
obligations as they come due.  Lastly, the Company is dependent
upon successful completion of additional financing and,
ultimately, to attain profitability.  Historically, the Company
has been successful in meeting ongoing cash requirements
sufficient to remain in operations; however there can be no
assurances that the Company will continue to be successful in
obtaining the funds necessary to meet the anticipated cash
requirements.  The Company plans to continue to finance its
operations and satisfy cash requirements with a combination of
debt financing, stock sales and in the longer term, revenues from
operations.  Management is confident that 2006 will see an
increase in domestic production as well as the beginnings of
developments in foreign properties.

Sonoran Energy, Inc. -- http://www.sonoranenergy.com/-- is an  
independent oil and gas company that is building a diversified
portfolio of high value oil and gas assets in North Africa, the
Middle East, the Caspian region and North America.  With a
presence in the UK, Middle East, Asia, and North America, Sonoran
Energy explores, develops, and enhances the performance of
material and high value oil and gas opportunities, leveraging the
Company's technical expertise and extensive industry and
governmental connections.

At Apr. 30, 2005, Sonoran Energy, Inc.'s balance sheet showed a
$7,429,471 stockholders' deficit, compared to a $4,829,250 deficit
at Apr. 31, 2004.


STERIGENICS INT'L: S&P Rates Planned $217 Mil. Term Loan B at B+
----------------------------------------------------------------
Standard & Poor's Ratings Services assigned its 'B+' senior
secured bank loan rating to Oak Brook, Illinois-based Sterigenics
International Inc.'s proposed, amended, and restated $217 million
first-lien term loan B due in 2011 and $35 million first-lien
revolving credit facility due in 2009.  A recovery rating of '3'
also was assigned to the secured loan, indicating the expectation
for meaningful (50%-80%) recovery of principal in the event of a
payment default.
     
In addition, Standard & Poor's affirmed its 'B+' corporate credit
rating on Sterigenics.  The rating outlook remains stable.  The
'B-' senior secured bank loan rating and '5' recovery rating on
the company's $35 million second-lien term loan will be withdrawn
once the transaction is completed as proposed.
     
Sterigenics plans to use the proceeds from approximately $37
million of additional first-lien term debt to repay the company's
$35 million of outstanding second-lien term debt and pay related
fees.  The transaction will likely lower Sterigenics' interest
expense as well as provide greater flexibility under the credit
agreement for the company's expansion plans both domestically and
abroad.  Standard & Poor's views this transaction as essentially
credit neutral.
      
"The ratings on sterilization and ionization services provider
Sterigenics reflect the company's single business focus in a
competitive industry," said Standard & Poor's credit analyst Jesse
Juliano.  "Also, Sterigenics has incurred relatively high debt
levels, and its capital expenditures are large relative to its
cash flow from operations.  These issues are partially offset by
Sterigenics' well-established market position, favorable industry
demand trends, and diverse and stable customer base."
     
With a market share of about 30%, Sterigenics is the leading
provider of sterilization and ionization services, which are its
only focus.  Using its four main technologies (ethylene oxide
sterilization, gamma irradiation, electron-beam, and X-ray
radiation), the company processes, among other things:

   * medical products,
   * foods,
   * polymers,
   * semiconductors, and
   * gemstones.

The company offers its services via 38 service centers in the:

   * U.S.,
   * Europe,
   * Canada,
   * Mexico,
   * Thailand, and
   * in the near future, China.

Its competitors include:

   * Steris Corporation,
   * Isotron plc, and
   * Cosmed Group Inc.


STEVE KING: Case Summary & 17 Largest Unsecured Creditors
---------------------------------------------------------
Debtor: Steve Ray & Teresa Kee King
        P.O. Box 419
        Camden, Tennessee 38320

Bankruptcy Case No.: 05-13853

Type of Business: The Debtors own Steve King Trucking, a trucking
                  company located in Camden, Tennessee.

Chapter 11 Petition Date: August 29, 2005

Court: Western District of Tennessee (Jackson)

Judge: G. Harvey Boswell

Debtor's Counsel: Timothy B. Latimer, Esq.
                  Utley & Latimer, P.C.
                  425 East Baltimore
                  Jackson, Tennessee 38301
                  Tel: (731) 424-3315

Total Assets: $690,734

Total Debts:  $2,289,440

Debtor's 17 Largest Unsecured Creditors:

   Entity                     Nature of Claim       Claim Amount
   ------                     ---------------       ------------
Internal Revenue Service                                $750,000
Insolvency Section
801 Broadway, MDP 146
Nashville, TN 37203

First Bank                    Shop & office located     $389,932
125 Highway 641               at 2810 Highway 641
Camden, TN 38320              South Business
                              1-tract 5 acres and
                              1-tract 1.5 acres
                              Value of security:
                              $150,000

Bank of Camden                (2) 1996                  $195,670
180 Highway 641               Internationals; (2)
Camden, TN 38320              1996 Freightliners;
                              CD; (3) Log trailers
                              Value of security:
                              $82,500

Carroll Bank & Trust          333.9 acres located       $193,463
                              on Pleasant Hill
                              Church Road
                              Value of security:
                              $71,100

Bank of Camden                142 acres w/ old          $192,253
                              cabin located on
                              Smothers Buena
                              Vista
                              Value of security:
                              $35,600

Caterpillar Financial         2005 Caterpillar          $160,000
                              Skidder
                              Value of security:
                              $130,000

First Bank                    1994 Chevy pickup;         $98,000
                              misc. farming
                              equipment
                              Value of security:
                              $6,200

First Bank                    Old van trailer, 1988      $98,000
                              Peterblt; 1994 Chevy
                              pickup; misc.
                              equipment
                              Value of security:
                              $10,000

Carroll Bank & Trust          775 Barko log cutter       $57,000
                              Value of security:
                              $30,000

First Bank                    2004 Chevy Tahoe           $18,000
                              $10,000

First Bank                    1995 Clark trailer         $15,816
                              Value of security:
                              $1,500

Carroll Bank & Trust          850 John Deere Dozer       $15,000
                              Value of security:
                              $8,500

Carroll Bank & Trust          (2) Log trailers           $10,000
                              Value of security:
                              $5,000

Carroll Bank & Trust          1996 Volvo                 $10,000
                              Value of security:
                              $5,500

First Bank                    12 Black Brangus cows       $9,600
                              Value of security:
                              $5,184

First Bank                    House & 1.3 acres           $5,566
                              located at 705
                              Pleasant Hill
                              Church Road,
                              Camden, Tennessee
                              Value of security:
                              $56,600

First Bank                    1993 Transcraft             $5,145
                              trailer
                              Value of security:
                              $2,500


STRATUS SERVICES: Balance Sheet Upside Down by $4.25MM at June 30
-----------------------------------------------------------------
Stratus Services Group Inc. reported its financial results for the
quarter ending June 30, 2005, in a Form 10-Q delivered to the
Securities and Exchange Commission on August 17, 2005.

Effective as of June 5, 2005, the Company sold substantially all
of the tangible and intangible assets, excluding accounts
receivable of its six Northern California offices to ALS, LLC.

The purchase price was $3,315,719.  Accordingly, on the Effective
Date, $3,315,719 due to ALS was deemed paid and cancelled.  In
addition, all amounts due to us from ALS as of the Effective Date
were deemed paid in full.  The amounts aggregating $376,394 were
comprised of:

   * a note receivable ($122,849),
   * accounts receivable ($50,000), and
   * other receivables ($203,545).

ALS and one of the Company's lender also entered into a
transaction pursuant to which ALS contributed $600,000 in exchange
for a junior participation interest in amounts borrowed under the
Company's line of credit.  ALS will pay to the Company $600,000 as
contingent purchase price, which will be paid to the Company or
offset against balances due by the Company to ALS, when ALS has
been repaid the junior participation interest and all other
amounts due to ALS are current and paid in full.

The sale resulted in a gain of $2,239,108,

Revenues from the sold branches were $10,087,390 and $5,209,445
for the nine months ended June 30, 2005 and 2004, respectively.

                      Continuing Operations

Three Months Ended June 30, 2005
Revenues

Revenues decreased 1.4% to $27,257,446 for the three months ended
June 30, 2005, from $27,637,948 for the three months ended
June 30, 2004.  The significant revenue increases we had realized
in the first two quarters of fiscal 2005 leveled off during the
three months ended June 30, 2005.  This, along with the loss of a
large customer accounted for the decrease in revenues.

Gross Profit

Gross profit increased 36.6% to $3,737,808 for the three months
ended June 30, 2005 from $2,368,341 for the three months ended
June 30, 2004.  Gross profit as a percentage of revenues increased
to 13.8% for the three months ended June 30, 2005 from 8.6% for
the three months ended June 30, 2004.  Effective May 2004, the
California State Compensation Insurance Fund increased our
effective workers' compensation rates by approximately 238%.  This
increase reduced our gross profit by approximately $800,000 or
2.9% of revenues during the three months ended June 30, 2004.  The
increase in gross profit and gross profit as a percentage of
revenues was a result of outsourcing our payroll under various
agreements with related parties, which enabled us to significantly
reduce our workers' compensation costs.

Selling, General and Administrative Expenses

Selling, general and administrative expenses increased 13.9% to
$4,077,662 for the three months ended June 30, 2005, from
$3,579,331 for the three months ended June 30, 2004.  SG&A
expenses as a percentage of revenues increased to 15.0% for the
three months ended June 30, 2005 from 13.0% for the three months
ended June 30, 2004.  The Company incurred fees of $380,985 (1.4%
of revenues) and $5,665 in the three months ended June 30, 2005
and 2004, respectively, in connection with its Outsourcing
Agreement with a related party.  The Company increased its
allowance for doubtful accounts in the three months ended
June 30, 2005, and 2004 and took a charge against operations of
$200,000 and $450,000, respectively.

Other Charges

Other charges in the three months ended June 30, 2005, represent
adjustments to reserves and premiums in connection with prior
years' workers' compensation insurance policies.

Interest Expense

Interest expense decreased 65.2% to $404,469 for the three months
ended June 30, 2005, from $1,160,740 for the three months ended
June 30, 2004.  Included in the three months ended June 30, 2004,
were dividends and accretion relating to the Series A Preferred
Stock and additional interest on unpaid taxes.

Net Loss Attributable to Common Stockholders

The Company had a net (loss) and net (loss) attributable to common
stockholders of $(1,011,390) and $(1,021,890), respectively, for
the three months ended June 30, 2005, compared to a net (loss) and
net (loss) attributable to common stockholders of $(2,340,881) and
$(2,422,779) for the three months ended June 30, 2004,
respectively.

                            Liquidity

At June 30, 2005, the Company had limited liquid resources.
Current liabilities were $25,880,269 and current assets were
$16,380,540.  The difference of $9,499,729 is a working capital
deficit, which is primarily the result of losses incurred from the
year ended September 30, 2002 through March 31, 2005.

The Company entered into an Amended and Restated Forbearance
Agreement with its lender on August 11, 2005.  If the Company
cannot obtain an alternate source of funding by the expiration of
the forbearance period, if not further extended, it may adversely
affect the Company's cash flow and there can be no assurance that
the Company's lender will not pursue all remedies available to it,
which could include the imposition of insolvency proceedings.
Additionally, if the Company cannot obtain an extension of the
forbearance agreement for payment defaults under its outsourcing
agreement with a related party, or is unable to cure the payment
defaults under the outsourcing agreement, going forward, there can
be no assurance that the Company will be able to obtain an
alternative outsourcing provider.  The Company said these
conditions raise substantial doubts about its ability to continue
as a going concern.  

A full-text copy of Stratus Services' Quarterly Report is
available for free at http://ResearchArchives.com/t/s?121

Stratus Services Group Inc. provides a wide range of staffing and
productivity consulting services nationally through a network of
offices located throughout the United States.  

As of June 30, 2005, Stratus Services' balance sheet reported a
$4,249,489 equity deficit compared to a $4,507,221 equity deficit
at September 30, 2004.


TELESYSTEM INT'L: Court Okays $4.2B Distribution to Shareholders
----------------------------------------------------------------
The Superior Court, District of Montreal, Province of Quebec has
issued, under Telesystem International Wireless Inc.'s
(TSX:TIW)(NASDAQ: TIWI) plan of arrangement, an order authorizing
a First Distribution to the Company's shareholders of $4.19
billion or $18.80 per fully diluted common share.

As previously announced, the First Distribution will be made
through a reduction of the stated capital of the common shares of
$17.01 per fully diluted common share and a dividend of $1.79 per
fully diluted common share.  The amount representing the reduction
of the stated capital will be distributed to holders of record as
at the close of business on September 8, 2005.  The dividend will
be distributed to holders of record as at the close of business on
September 21, 2005.  Both the reduction of the stated capital and
the dividend will be payable on September 27, 2005.

Telesystem International Wireless Inc. operates under a court  
supervised Plan of Arrangement to complete the transaction with  
Vodafone announced on March 15, 2005, proceed with its  
liquidation, including the implementation of a claims process and  
the distribution of net cash to shareholders, cancel its common  
shares and proceed with its final distribution and be dissolved.  
TIW's shares are listed on NASDAQ (TIWI) and on the Toronto  
Stock Exchange (TIW).   


TRENWICK GROUP: Two Creditors Want Dismissal Order Vacated
----------------------------------------------------------
LaSalle Cover Company, LLC, and Costa Brava Partnership III, L.P.,
ask the U.S. Bankruptcy Court for the District of Delaware to:

   -- set aside dismissal orders for Trenwick Group, Ltd., and
      LaSalle Re Holdings Limited;

   -- reopen the Debtors' bankruptcy cases; and

   -- appoint Chapter 11 Trustees.

LaSalle Cover and Costa Brava are creditors and equity holders of
the Debtors.  They are registered owners of:

   -- 1,350,830 shares of Series A Preferred Stock of LaSalle Re
      Holdings, and

   -- 220,000 shares of Common Stock of Trenwick Group.

LaSalle Cover also holds a liquidated, non-contingent, non-
disputed $7.6 million unsecured claim against LaSalle Re Holdings.

In September 2000, Trenwick America Corporation and Trenwick
Holdings Limited (UK), Trenwick Group's subsidiaries, entered into
a $490 million credit agreement with various Banks.  LaSalle Re
Holdings and LaSalle Re Limited guaranteed the credit agreement.  
The credit agreement consisted of:

   -- a $260 million revolving credit facility, and
   -- a $230 million letter of credit facility.

The Revolving Credit Facility was converted into a four-year term
loan and repaid in full by a loan from LaSalle Re Limited to
Trenwick Group.  Trenwick Group paid $195 million to the Banks on
Trenwick America's behalf on June 17, 2002.

Mark Minuti, Esq., at Saul Ewing LLP in Wilmington, Delaware,
tells the Court that it is not clear from documents available to
the Creditors whether the transferred money constituted a loan or
a capital contribution in Trenwick America.  Neither Trenwick
Group nor Trenwick America included the transfer as a debt or
receivable in their Schedules of Assets and Liabilities.

On Dec. 24, 2002, the Credit Agreement was further amended to:

   -- reduce the Letter of Credit to $182.5 million; and

   -- grant the Banks security interest in the assets and debts of
      Trenwick Group's subsidiaries.

At the Confirmation Hearing on Trenwick America's Plan and Motion
to Dismiss on Oct. 27, 2004, the three Debtors did not disclose to
the Bankruptcy Court that:

   (a) they had entered into the Second Amended Credit Agreement
       the previous day;

   (b) the terms of the Second Amended Credit Agreement
       substantially prejudiced the rights of the Debtors'
       creditors -- other than the Banks -- and shareholders by
       purporting to encumber their assets;

   (c) if Trenwick America owes Trenwick Group $195 million,
       the debt would constitute a significant unadministered
       asset in Trenwick Group's estate; and

   (d) if Trenwick Group holds a $195 million claim against
       Trenwick America, that claim would likely render Trenwick
       America's Plan not feasible and therefore not confirmable.

Mr. Minuti adds that the Court rendered its decisions regarding
the Motion to Dismiss and Confirmation of Trenwick America's Plan
based on inaccurate information.  Due to the failure to disclose
complete information to the three Debtors' creditors, those
creditors did not receive a fair opportunity to consider Trenwick
America's Plan or the Motion to Dismiss.

Mark Minuti, Esq., and Jeremy Ryan, Esq., at Saul Ewing LLP in
Wilmington, Delaware and Michael D. Warner, Esq., and Lewis T.
Stevens, Esq., at Warner Stevens, L.L.P., in Fort Worth, Texas
represent LaSalle Cover Company, LLC, and Costa Brava Partnership
III, L.P., in Trenwick's cases.

Headquartered in Hamilton, Bermuda, Trenwick Group, Ltd. --
http://www.trenwick.com/-- and LaSalle Re Holdings Limited filed  
for Section 304 proceeding on April 26, 2005 (Bankr. D. Del. Case
Nos. 05-11193 & 05-11194).  The Debtors are affiliates of Trenwick
America Corporation.  The Debtors, together with Trenwick America,
filed for chapter 11 protection on August 20, 2003 (Bankr. D. Del.
Case No. 03-12637).  On Nov. 2, 2004, the Honorable Judge Walrath
dismissed Trenwick Group and LaSalle Re Holdings' chapter 11 cases
and the cases were closed on Dec. 29, 2004.  Mark E. Felger, Esq.,
at Cozen O'Connor represents the Debtors.  When the Debtors filed
for ancillary proceeding, they estimated assets between $10
million and $50 million and debts between $50 million to $100
million.


VARICK STRUCTURED: Credit Quality Slump Cues Fitch to Cut Ratings
-----------------------------------------------------------------
Fitch Ratings downgrades four classes of notes issued by Varick
Structured Asset Fund, Ltd.  These rating actions are effective
immediately:

   -- $33,132,878 class A-1 notes downgrade to 'B' from 'BB';
   -- $198,797,265 class A-2 notes downgrade to 'B' from 'BB';
   -- $26,181,585 class B-1 notes downgrade to 'C' from at 'CC';
   -- $7,928,972 class B-2 notes downgrade to 'C' from at 'CC';
   -- $8,494,785 class C notes remains at 'C'.

Varick is a collateralized debt obligation managed by Clinton
Group, Inc.  The deal was established in September 2000 to issue
$404 million in notes and equity.  The collateral supporting the
CDO is comprised of a diversified portfolio of asset-backed
securities, residential mortgage-backed securities and commercial
mortgage-backed securities.

The rating actions are a result of continued deterioration in the
credit quality of Varick's collateral pool and the continued
negative impact of its interest rate hedge.  Since the last rating
action on Dec. 6, 2004, nine assets have been downgraded and
assets rated below investment grade have increased to 52.1% of the
total portfolio.  This deterioration of credit quality has
resulted in the continued erosion of Varick's
overcollateralization ratios.

As of the July 2005 trustee report, the class A OC ratio has
decreased to 97.4% from 102.1% as of the October 2004 trustee
report, and is currently below its trigger of 109.5%, The class A
interest coverage ratio is currently 77%, and is also well below
its trigger of 114%.

The failure of the class A OC and IC tests has caused any excess
proceeds to be applied to the redemption of the class A notes
following the payment of class A interest, and causes the class B
notes to be shut off from their scheduled distributions.  The
class B notes last received their scheduled interest payment on
the November 2003 payment date.  Since the May 2004 payment date,
there has been an insufficient amount of interest proceeds
available to pay the full amount of class A interest, causing
principal proceeds to be applied to make up the difference.

As a result of this analysis, Fitch has determined that the
current ratings assigned to the class A-1, A-2, B-1 and B-2 notes
no longer reflect the current risk to noteholders.

The rating of the class A-1 and A-2 notes addresses the likelihood
that investors will receive full and timely payments of interest,
as per the governing documents, as well as the stated balance of
principal by the legal final maturity date.  The ratings of the
class B-1, B-2 and C notes address the likelihood that investors
will receive ultimate and compensating interest payments, as per
the governing documents, as well as the stated balance of
principal by the legal final maturity date.

Fitch will continue to monitor and review this transaction for
future rating adjustments.  Additional deal information and
historical data 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, available on Fitch's web site
at http://www.fitchratings.com/


VILLAGES AT SARATOGA: Case Summary & 8 Unsecured Creditors
----------------------------------------------------------
Debtor: The Villages at Saratoga Springs, LC
        1094 North Ridgeway
        Spanish Fork, Utah 84660

Bankruptcy Case No.: 05-33380

Chapter 11 Petition Date: August 29, 2005

Court: District of Utah (Salt Lake City)

Debtor's Counsel: Robert Fugal, Esq.
                  Bird & Fugal
                  384 East 720 South, Suite 201
                  Orem, Utah 84058
                  Tel: (801) 426-4700

Estimated Assets: $10 Million to $50 Million

Estimated Debts:  $10 Million to $50 Million

Debtor's 8 Largest Unsecured Creditors:

   Entity                     Nature of Claim       Claim Amount
   ------                     ---------------       ------------
Hearthstone Development       Trade debt              $1,600,000
1094 North Ridgeway
Spanish Fork, UT 84660

Dave Olsen                    Trade debt                $700,000
722 South Carterville Road
Orem, UT 84097

Cypress Financial, LLC        Trade debt                $306,000
11849 Hidden Brook Boulevard
Sandy, UT 84092

Scribner & McCandless, P.C.   Trade debt                $306,000
Thomas J. Scribner
2696 North University Avenue,
#220
Provo, UT 84604

John D. Jacob                 Trade debt                $200,000
P.O. Box 643
Lehi, UT 84043

Gerald Cross                  Trade debt                 $75,000

Glenn Powell                  Trade debt                 $65,000

Larson & Peterson             Trade debt                 $40,000


W.R. GRACE: Wants to Assume & Assign Pa. Lease to Rising Sun
------------------------------------------------------------
By a Lease Agreement dated November 8, 1978, as amended, Rising
Sun Plaza Associates, L.P., leased to W.R. Grace & Co. a property
located at 5675 Rising Sun Avenue in Philadelphia, Pennsylvania.

Grace subleased the Premises to Grace Retail Corporation through
a Restated Agreement of Sublease dated November 25, 1986.
Pursuant to an Assignment and Assumption of Sublease dated
November 26, 1986, Grace Retail assigned its subleasehold
interest to Channel Home Centers Realty Corporation.  Pursuant to
an Assignment of Sublease dated October 13, 1989, Channel
assigned its subleasehold interest to OW Office Warehouse, Inc.

The Sublease was then amended by an Amendment to Sublease and a
Consent and Agreement among Grace, Rising Sun Plaza, Channel,
Channel Home Centers, Inc., and OW Office.

Rising Sun Plaza and Channel entered into a Consulting Agreement
dated July 24, 1989, pursuant to which a consulting fee became
payable annually by Rising Sun Plaza to Channel.  The term of the
Consulting Agreement extends until January 31, 2010.

By order dated March 18, 1992, of the United States Bankruptcy
Court for the District of New Jersey, in the Matter of Channel
Home Centers, Inc., Channel Home Centers Realty Corporation and
Channel Acquisition Company, and the Sale and Assignment
Agreement dated as of April 1, 1992, between Channel and Grace,
Grace succeeded to the interests of Channel under both the
Sublease and Consulting Agreement.

Laura Davis Jones, Esq., at Pachulski, Stang, Ziehl, Young, Jones
& Weintraub P.C., in Wilmington, Delaware, relates that the
effect of all of these transactions is that Rising Sun Plaza is
the owner and prime landlord of the Premises, Grace is the prime
landlord's tenant under the Prime Lease, OW Office is Grace's
subtenant under the Sublease, and Grace and Rising Sun Plaza are
parties to the Consulting Agreement.

Consequently, Grace wants to transfer and assign to Rising Sun
Plaza Associates II, L.P., all of its right, title and interest
in and to the Prime Lease and the Sublease.  RSPA II also desires
to acquire that interest, accept the assignment and assume
Grace's obligations.  Grace, Rising Sun Plaza and RSPA II want to
liquidate the amounts payable by Rising Sun Plaza to Grace under
the Consulting Agreement for the remainder of the term and
terminate it.

On June 27, 2005, Grace, Rising Sun Plaza and RSPA II entered
into an Assignment and Assumption Agreement.  In exchange for the
assignment and a release from all exposure and administrative
burdens associated with the Primary Lease and Sublease, the
consideration payable to the Debtors under the Assignment and
Assumption Agreement would be $50,000.  This represents a
substantial portion of the consulting fee owed to Grace under the
Consulting Agreement over the remaining term of the Prime Lease
and Sublease, Ms. Jones says.  The Consulting Agreement will then
be terminated as of the effective date of the Assignment and
Assumption Agreement.

Accordingly, the Debtors seek the U.S. Bankruptcy Court for the
District of Delaware's authority to enter into
the Assignment and Assumption Agreement, in which they would:

    (a) assume the Prime Lease and Sublease;

    (b) assign all of their rights and obligations under the Prime
        Lease and Sublease to RSPA II; and

    (c) be paid a $50,000 consulting fee.

Ms. Jones tells the Court that the Debtors do not use the
Premises and the Premises are not necessary for their
reorganization efforts.  The Debtors serve merely as a "middle-
man" by leasing the Premises from Rising Sun Plaza and
simultaneously subleasing the premises to OW Office.  Therefore,
Ms. Jones says, the assumption and assignment would allow the
Debtors to relieve themselves of the administrative burdens and
financial risks associated with serving as the "middle-man" in
the structure, while occupying a substantial portion of the
remaining consulting fees.

Ms. Jones believes that if the Court authorizes the assumption
and assignment, then the only effect would be that Grace would no
longer serve as an intermediary between Rising Sun Plaza and OW
Office.  Since Grace's obligations with respect to OW Office only
relate to making the Premises available and suitable for
occupation and RSPA II is already primarily responsible for the
same obligations, she asserts, the assumption and assignment
would not materially alter OW Office's interest with respect to
the Premises.  Furthermore, the Debtors are not aware of any
information that suggests RSPA II will not be able to
subsequently satisfy its obligation under the Prime Lease or
Sublease.


Headquartered in Columbia, Maryland, W.R. Grace & Co. --
http://www.grace.com/-- supplies catalysts and silica products,         
especially construction chemicals and building materials, and
container products globally.  The Company and its debtor-
affiliates filed for chapter 11 protection on April 2, 2001
(Bankr. Del. Case No. 01-01139).  James H.M. Sprayregen, Esq.,
at Kirkland & Ellis, and Laura Davis Jones, Esq., at Pachulski,
Stang, Ziehl, Young, Jones & Weintraub, P.C., represent the
Debtors in their restructuring efforts.  (W.R. Grace Bankruptcy
News, Issue No. 93; Bankruptcy Creditors' Service, Inc.,
215/945-7000)


WATERMAN INDUSTRIES: Submits Case Status Report to Judge Lee
------------------------------------------------------------
Waterman Industries, Inc., submitted a status report on its
chapter 11 case to the Hon. W. Richard Lee of the U.S. Bankruptcy
Court for the Eastern District of California in Fresno.

The Debtor's counsel,  Riley C. Walter, Esq., at the Walter Law
Group, informs Judge Lee that:

   a) Galena Capital LLC and the Official Committee of Unsecured
      Creditors are reviewing a proposed term sheet for a chapter
      11 plan.  The issues between them have been narrowed but
      agreements as to the terms of the proposed plan have not
      been reached.

   b) the County of Tulane has withdrawn is asserted secured
      claim.

   c) a conceptual arrangement has been made with San Joaquin Bank
      for allocation of the proceeds of the proposed sale of the
      Debtor's G Street property.

   d) the Debtor continues to work with a claims administrator to
      determine how much priority claims arise under section
      507(a) of the Bankruptcy Code.  The committee has filed an
      objection to the claim of California State Insurance
      security Find asserted under section 507(a).

   e) work continues on the collection of accounts receivable
      being handled by Gubler & Ide.  Gubler & Ide assists the
      Debtor in recovering overdue accounts in excess of $500,000.

Headquartered in Exeter, California, Waterman Industries, Inc.
-- http://www.watermanusa.com/-- provides water and irrigation  
control services.  The Company filed for chapter 11 protection on
February 10, 2004 (Bankr. E.D. Calif. Case No. 04-11065).  Riley
C. Walter, Esq., at Walter Law Group, represents the Debtor in its
restructuring efforts.  When the Debtor filed for protection from
its creditors, it listed more than $10 million in estimated assets
and debts.


WORLDCOM INC: Sharon Byrd Wants Stay Lifted to Pursue Claim
-----------------------------------------------------------
Sharon W. Byrd was the holder of an account for long distance
services with WorldCom Inc. and its debtor-affiliates.  Patrick J.
Orr, Esq., at Klestadt & Winters, LLP, in New York, tells the U.S.
Bankruptcy Court for the Southern District of New York that the
Debtors refused to refund certain amounts due and owing to Ms.
Byrd and then proceeded to destroy Ms. Byrd's credit rating while
undertaking overly aggressive collection efforts to collect on
amounts allegedly owed to it.

On February 15, 2000, Ms. Byrd commenced an action in the Court of
Common Pleas, 16th Judicial Circuit of South Carolina, alleging
breach of contract, breach of contract accompanied by fraudulent
intent, negligence, fraud and unfair trade practices.

In July 2000, the Debtors filed a motion for summary judgment.  
The South Carolina Court granted the Debtors' request and:

   (a) dismissed all Ms. Byrd's state law claims, with prejudice;
       and

   (b) without ruling whether Ms. Byrd had properly asserted
       federal claims, ruled that any claim had to be brought
       before the Federal Communications Commission or an
       appropriate federal district court.

On March 2, 2001, Ms. Byrd filed a Notice of Appeal with the
Court of Appeals for the State of South Carolina, contesting the
Dismissal Order.

Ms. Byrd filed Claim No. 26550, on January 23, 2003, relating to
the South Carolina Action.  The Debtors objected to the Claim.

Accordingly, Ms. Byrd asks the Court to lift the automatic stay to
allow her to continue with her appeal in the South Carolina Court
of Appeals.

Mr. Orr asserts that Claim No. 26650 was filed in an unliquidated
amount and a determination needs to be made as to the value of the
Claim as an initial matter.  Ms. Byrd believes that the South
Carolina courts would make the best arbiters with respect to the
value of the Claim.

Mr. Orr further argues that Ms. Byrd's request is warranted for
these reasons:

   (1) Relief would provide complete resolution of the issues as
       the South Carolina Action is already in the appellate
       stage;

   (2) The South Carolina Action is a non-core proceeding and has
       no connection nor would it interfere with the Debtors'
       bankruptcy case;

   (3) The South Carolina courts possess the expertise required
       to decide issues at the crux of the South Carolina Action;

   (4) The relief would not prejudice the rights of other
       creditors;

   (5) The parties are ready to proceed with the Appeal; and

   (6) The relief would allow the Appeal to resume where it left
       off rather than re-litigating fully the underlying issues
       of the South Carolina Action in the Bankruptcy Court.

To the extent the Bankruptcy Court decides that estimation of the
value of the Claim is the proper course, Ms. Byrd asks the Court
to set a value not less than $25,000, which adequately reflects
the amount she would have been awarded if successful on the Appeal
and subsequent new trail.

                          Debtors Object

The Debtors do not oppose the lifting of the automatic stay for
the limited purpose of permitting the Appeal to be resolved in the
South Carolina appellate court.

To the extent Ms. Byrd has additional grounds to support her
Claim, Mark A. Shaiken, Esq., at Stinson Morrison Hecker LLP, in
Kansas City, Missouri, asserts that those grounds can be resolved
before the Bankruptcy Court with the Debtors reserving all rights
to challenge the Claim on any and all grounds.

If the Summary Judgment is reversed, the Debtors oppose resolving
the merits of the Claim in any forum other than the Bankruptcy
Court in the claims objection process.

Mr. Shaiken asserts that the Plan provides that the Bankruptcy
Court has exclusive jurisdiction to resolve claim disputes like
those presented in the Claim Objection.

Furthermore, the automatic stay terminated upon the discharge of
the Debtors, no later than the Effective Date of the Plan.  Mr.
Shaiken relates that the stay was replaced by Section 524(a)(2)
permanent injunction.  Thus, Ms. Byrd would have to obtain relief
from the effect and operation of the Confirmation Order, not
relief from the automatic stay.

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


WORLDCOM INC: Moves for Summary Judgment on Waldinger's Claim
-------------------------------------------------------------
The Waldinger Corporation asserted that Claim No. 3059 filed
against WorldCom, Inc., and its debtor-affiliates is a Class 3
Other Secured Claim and is secured by a construction lien filed on
October 29, 2001, Shane C. Mecham, Esq., at Stinson Morrison
Hecker, LLP, in Kansas City, Missouri, tells the U.S. Bankruptcy
Court for the Southern District of New York.  Waldinger filed the
claim in December 2002, for $371,362, plus additional charges, for
"services performed."  

The Debtors objected to the Claim.

               The WorldCom-Waldinger Transaction

On November 14, 2000, WorldCom Purchasing, LLC, issued Purchase
Order No. 4570125530 to Waldinger for the purchase of Air Handler
Unit Nos. 6, 7 and 43 for its Mid-Continent Data Center in Omaha,
Nebraska.  Mr. Mecham relates that WorldCom paid for the Air
Handler Units.

Waldinger alleged that it proceeded with the installation of the
Air Handler Units at the Omaha Data Canter, in April 2001,
pursuant to WorldCom's request dated March 30, 2001.  Waldinger
demanded $371,362, from WorldCom for the installation costs.

WorldCom disputed the assertion that it requested and gave
Waldinger the authority to proceed with the installation of the
Air Handler Units.

On October 29, 2001, Waldinger filed with the Register of Deeds of
Douglas County, Nebraska, a lien claim for labor, services and
materials needed to replace three air handling units Waldinger
provided at Lot 4, World Communications Park, in Omaha, Nebraska.  
The total value of the Lien was $947,362.  Waldinger claimed that
$463,862 of the Lien was unpaid.

In January 2002, Waldinger filed a petition in the District Court
of Douglas County, Nebraska, against WorldCom, alleging breach of
contract and quantum meruit.  As of July 27, 2005, Waldinger has
not brought a claim to foreclose the Lien under Nebraska law.

On March 6, 2002, WorldCom removed the State Court Action to the
United States District Court for the District of Nebraska.  On
March 22, 2005, Waldinger voluntarily dismissed the Federal Court
Action, without prejudice.

To resolve all claims, Waldinger and WorldCom entered into a
settlement in June 2002 and agreed that WorldCom would execute an
Installation Services Agreement with Waldinger.  Under the
Agreement, the parties agree that:

   (1) WorldCom would issue a purchase order, aggregating
       $499,718, to Waldinger to authorize the installation of
       the Air Handler Units at the Omaha Data Center;

   (2) Waldinger would send WorldCom an invoice, totaling
       $371,362, and WorldCom would pay Waldinger that amount;

   (3) Waldinger would complete the installation of the Air
       Handler Units; and

   (4) Waldinger would send WorldCom a second invoice, totaling
       $128,356, and WorldCom would pay Waldinger that amount.

Waldinger has not completed the installation of the Air Handler
Units under the Settlement Agreement as of July 27, 2005, Mr.
Mecham tells Judge Gonzalez.  In effect, WorldCom has not paid
Waldinger any amount.

The Debtors ask the Court to grant them partial summary judgment
and allow Claim No. 3059 as a Class 6 General Unsecured Claim.

Waldinger's Claim is based on the Settlement Agreement, which is a
prepetition contract that was breached, Mr. Mecham contends.  A
prepetition breach of contract is grounds for a general unsecured
claim, Mr. Mecham adds.

Mr. Mecham further notes that under Nebraska law, a construction
lien is only enforceable for a period of two years after its
recording unless "a judicial proceeding to enforce the lien is
instituted while the lien is effective. . . ." Nebraska Rev.  
Stat. 2-140(1); 52-140(3).  If that action is instituted, the lien
continues during the pendency of the proceeding.

Waldinger filed its Lien on October 29, 2001.  Mr. Mecham asserts
that there is no evidence that Waldinger recorded a demand to
institute judicial proceedings to enforce the Lien.  Waldinger
never sought foreclosure of its Lien or instituted any similar
judicial proceeding to enforce its Lien.  Therefore, Waldinger's
Lien lapsed on October 29, 2003.

Mr. Mecham clarifies that both the State Court Action and Federal
Court Action were attempts to resolve the contract dispute between
Waldinger and WorldCom.  Neither were attempts by Waldinger to
enforce its Lien.

Mr. Mecham also contends that Waldinger's filing of Claim No.
3059 did not continue the Lien.  The Claim merely asserts that the
Debtors owe money to Waldinger.  The Claim is not a suit to
foreclose property.

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


WET SEAL: Posts $11.7MM Net Loss for 13-Weeks Ended July 30, 2005
-----------------------------------------------------------------
Specialty retailer The Wet Seal, Inc. (Nasdaq:WTSLA) reported a
net loss from continuing operations of $11.7 million for the 13-
week period ended July 30, 2005.  Included in the net loss was a
$16.1 million charge associated with its previously announced
agreement with Michael Gold.  The charge for Michael Gold included
$2.1 million in cash compensation and $14.0 million in non-cash
stock compensation.

In addition, the current quarter net loss included $600,000 in
director and employee non-cash stock compensation charges and
$900,000 in non-cash interest charges.  The current quarter net
loss from continuing operations of $11.7 million compares to a net
loss from continuing operations of $106.2 million for the same
period last year.  

The prior year's net loss for the 13-week period ended July 31,
2004 included a non-cash impairment charge of $40.4 million for
certain long-lived assets and the establishment of a non-cash tax
valuation allowance against the Company's deferred tax assets of
$38.9 million.  The Company ceased recognizing tax benefits
related to its operating losses beginning with its second quarter
last year.  Results for the 13-week period ended July 31, 2004,
have been restated in connection with the Company's previous
review of lease accounting transactions.

"Our accelerated sales growth and operating margin improvements
have led to a significant improvement in operating results," Mr.
Joel Waller, chief executive officer, said.  "Before non-cash
compensation charges, we delivered operating income of
$4.2 million.  The additional funds from our previously announced
May 2005 financing, the continued growth in same-store sales and
improving operating margins have significantly improved our
liquidity position."

On May 3, 2005, the Company disclosed the completion of its equity
financing transaction which included the issuance of a new class
of convertible preferred stock that was convertible into 8,200,000
shares of the Company's Class A common stock and warrants to
purchase 7,500,000 shares of Class A common stock for an aggregate
purchase price of $24.6 million.  In accordance with generally
accepted accounting principles (GAAP), the Company was required to
determine the relative fair values of the convertible preferred
stock issued, warrants issued, and the related registration rights
agreement.  The Company was also required to determine the value
to assign to the beneficial conversion feature associated with the
convertible preferred stock.  The Company assigned relative fair
values of $8.5 million to the warrants, $14.7 million to the
beneficial conversion feature and $0.1 million to the registration
rights agreement, and reduced the carrying value of the
convertible preferred stock by $23.3 million in the form of a
discount.  This discount was amortized in the form of a deemed
non-cash preferred dividend for the 13-week period ended July 30,
2005, representing the entire fair value assigned to the
beneficial conversion feature, the warrants and the registration
rights agreement.  The preferred stock discount was recognized as
a deemed non-cash preferred dividend in its entirety since the
convertible preferred stock is immediately convertible and had no
stated redemption date.

As a result of the deemed non-cash preferred stock dividend, the
Company had a net loss attributable to common stockholders of
$35.0 million.  This compares to a net loss attributable to common
stockholders of $106.3 million for the same period a year ago.

Net sales for the 13-weeks ended July 30, 2005 were
$126.3 million, compared with net sales of $105.7 million for the
same period last year, a 19.5 percent increase.  Sales increased
over the same period a year ago despite a significant reduction in
store count, primarily related to the previously announced closure
of 153 Wet Seal stores during its fiscal 2004 fourth quarter and
fiscal 2005 first quarter.  The sales increase was a result of a
comparable store sales increase from continuing operations of 55.9
percent for the 13-week period ended July 30, 2005.  Last year's
comparable store sales declined 10.9 percent for the same 13-week
period.

During the 13-week period ended July 30, 2005, the Company re-
opened 3 Wet Seal stores and closed 5 Wet Seal stores.  At
July 30, 2005, the Company operated 305 Wet Seal stores and 91
Arden B. stores.

              13-Week Period Ended July 30, 2005

Wet Seal reported net sales for the 13-weeks ended July 30, 2005
of $126.3 million, compared with net sales of $105.7 million for
the same period last year, a 19.5 percent increase.  Although the
Company closed 153 Wet Seal stores, sales increased over the prior
year's quarter due to the significant increase in comparable store
sales.  The growth in comparable store sales was driven by
increased transaction counts in both the Wet Seal and Arden B.
businesses.

Gross profit margin dollars increased $30.7 million over last year
and, as a percentage of sales, increased 22.7 percentage points to
32.9%.  A number of factors contributed to the improvement:

   1) significantly lower markdown volume in the Wet Seal
      division,

   2) the closing of low volume, unprofitable stores and

   3) leverage benefits, primarily on occupancy costs, due to
      increased sales volume.

The Company has substantially completed its store closure effort
and related lease terminations that were previously announced.  As
a result, the Company reduced its remaining store closure reserve
by $500,000 as of July 30, 2005.  This reduction reflects the
Company's most recent estimate of future payments necessary to
complete its lease terminations.

The Company's cash position at July 30, 2005 was $65.1 million, a
decline of $6.6 million from the cash position at January 31,
2005.  The decline in the cash position was principally due to
lease termination payments of $13.5 million, inventory buildup net
of trade credit of $14.9 million and capital expenditures
primarily for new store development and relocations of $4 million
partially offset by changes in other working capital items and net
proceeds from financing activities of $17.6 million.  For the 13-
week period ending July 30, 2005, the Company realized $2.7
million in cash flow from operations despite shorter credit terms
during the 13-week quarter.  Merchandise payables, as a percent of
inventory, was 37.6% versus 56.8% at January 31, 2005. The
decrease in the merchandise payable to inventory ratio was also
due to shorter credit terms.

                        CFO Resignation

Douglas C. Felderman, has resigned from his post as the Company's
Chief Financial Officer, due to personal reasons.

The Company has retained a firm to conduct an executive search for  
Mr. Felderman's replacement.

                        Risks & Warnings  

Deloitte & Touche LLP expressed an unqualified opinion on the   
management assessment of the effectiveness of the Company's   
internal control over financial reporting and an adverse opinion   
on the effectiveness of the Company's internal control over   
financial reporting because of material weaknesses after reviewing   
the company's financial statements for the fiscal year    
ending January 29, 2005.    

                       Bankruptcy Warning  

In light of its poor operating performance, diminished liquidity   
and poor credit standing, the Company initiated a series of steps   
to maximize shareholder value.  This began with the appointment of   
a special committee of its board of directors mandated to engage a   
financial advisor and evaluate strategic alternatives, including a   
potential reorganization under Chapter 11 of the United States   
Bankruptcy Code.    

Headquartered in Foothill Ranch, California, The Wet Seal, Inc. --
http://www.wetsealinc.com/-- is a leading specialty retailer of  
fashionable and contemporary apparel and accessory items.  The
Company currently operates a total of 396 stores in 46 states, the
District of Columbia and Puerto Rico, including 305 Wet Seal
stores and 91 Arden B. stores.


* Upcoming Meetings, Conferences and Seminars
---------------------------------------------
September 1-30, 2005
   TURNAROUND MANAGEMENT ASSOCIATION
      Education Program
         Venue - TBA, Toronto, ON
            Contact: http://www.turnaround.org/

September 8-9, 2005
   TURNAROUND MANAGEMENT ASSOCIATION
      Golf Tournament and TMA Regional Conference
         Gideon Putnam Hotel, Saratoga Springs, New York
            Contact: 716-667-3160; http://www.turnaround.org/
September 8-9, 2005
   TURNAROUND MANAGEMENT ASSOCIATION
      Northeast Regional Conference Sponsorship Opportunities
         Gideon Putnam Hotel, Saratoga Springs, New York
            Contact: 716-440-6615 / 516-465-2356 or                  
               http://www.turnaround.org/

September 8-11, 2005
   AMERICAN BANKRUPTCY INSTITUTE
      Southwest Bankruptcy Conference
         (Including Financial Advisors/Investment Bankers Program)
            The Four Seasons Hotel, Las Vegas, Nevada
               Contact: 1-703-739-0800; http://www.abiworld.org/

September 9, 2005
   TURNAROUND MANAGEMENT ASSOCIATION
      Motorcycle Ride
         Lake Shore Harley Davidson, Libertyville, Illinois
            Contact: 815-469-2935 or http://www.turnaround.org/

September 10, 2005
   TURNAROUND MANAGEMENT ASSOCIATION
      ALS Walk 4 Life
         Montrose Harbor, Chicago, Illinois
            Contact: 815-469-2935 or http://www.turnaround.org/

September 12, 2005
   TURNAROUND MANAGEMENT ASSOCIATION
      Annual TMA-LI Chapter Board Meeting
         Venue - TBA
            Contact: 516-465-2356; http://www.turnaround.org/

September 14, 2005
   FINANCIAL RESEARCH ASSOCIATES LLC
      Understanding the New Bankruptcy Legislation & its              
         Implications
            New York, New York
               Contact: http://www.frallc.com/

September 15, 2005
   TURNAROUND MANAGEMENT ASSOCIATION
      7th Annual Lender's Forum: Surviving Bank Mergers
         Milleridge Cottage, Long Island, New York
            Contact: 516-465-2356; 631-434-9500;                  
               http://www.turnaround.org/

September 15, 2005
   TURNAROUND MANAGEMENT ASSOCIATION
      Colorado TMA Breakfast
         The Oxford Hotel, Denver, Colorado
            Contact: 303-457-2119; http://www.turnaround.org/

September 15, 2005
   TURNAROUND MANAGEMENT ASSOCIATION
      TMA Quarterly Meeting: The Bankruptcy Act
         Nashville, Tennessee
            Contact: http://www.turnaround.org/

September 16, 2005
   TURNAROUND MANAGEMENT ASSOCIATION
      Body of Knowledge Management Review [Chicago/Midwest]
         Venue - TBA
            Contact: 815-469-2935; http://www.turnaround.org/

September 17, 2005
   CONTINUING EDUCATION OF THE BAR
      Bankruptcy Reform: Changing the Ground Rules for Personal
         & Small Business Bankruptcy Practice
            Los Angeles and Beverly Hills, California
               Contact: http://www.ceb.com/;1-800-232-3444

September 17, 2005
   CONTINUING EDUCATION OF THE BAR
      Selected Issues in Bankruptcy Practice
         Los Angeles and Beverly Hills, California
            Contact: http://www.ceb.com/;1-800-232-3444

September 20, 2005
   TURNAROUND MANAGEMENT ASSOCIATION
      Lenders' Panel: Deal Structures in 2005
         TBD, Pittsburgh, Pennsylvania
            Contact: bmanne@tuckerlaw.com or
               http://www.turnaround.org/

September 22, 2005
   TURNAROUND MANAGEMENT ASSOCIATION
      3rd Annual Workout Lenders Panel Luncheon
         Union League Club, NYC
            Contact: 646-932-5532; http://www.turnaround.org/

September 22, 2005
   TURNAROUND MANAGEMENT ASSOCIATION
      3rd Annual Workout Lenders Panel
         Union League Club, New York, New York
            Contact: 908-575-7333; http://www.turnaround.org/

September 22-25, 2005
   TURNAROUND MANAGEMENT ASSOCIATION
      Cross-Border Conference
         Grand Hyatt Seattle, Seattle, Washington
            Contact: 503-223-6222; http://www.turnaround.org/

September 23, 2005
   AMERICAN BANKRUPTCY INSTITUTE
      International Insolvency Workshop
         London, UK
            Contact: 1-703-739-0800; http://www.abiworld.org/

September 23, 2005
   CONTINUING EDUCATION OF THE BAR
      Bankruptcy Reform: Changing the Ground Rules for Personal
         & Small Business Bankruptcy Practice
            San Francisco, California
               Contact: http://www.ceb.com/;1-800-232-3444

September 23, 2005
   CONTINUING EDUCATION OF THE BAR
      Selected Issues in Bankruptcy Practice
         San Francisco, California
            Contact: http://www.ceb.com/;1-800-232-3444

September 24, 2005
   CONTINUING EDUCATION OF THE BAR
      Bankruptcy Reform: Changing the Ground Rules for Personal
         & Small Business Bankruptcy Practice
            Costa Mesa, California
               Contact: http://www.ceb.com/;1-800-232-3444

September 24, 2005
   CONTINUING EDUCATION OF THE BAR
      Selected Issues in Bankruptcy Practice
         Costa Mesa, California
            Contact: http://www.ceb.com/;1-800-232-3444

September 26, 2005
   AMERICAN BANKRUPTCY INSTITUTE
      International Insolvency Workshop
         Site to Be Determined London, England
            Contact: 1-703-739-0800; http://www.abiworld.org/

September 26, 2005
   TURNAROUND MANAGEMENT ASSOCIATION
      Second Annual Golf Outing
         Pittsburgh, Pennsylvania
            Contact: 412-577-2995 or http://www.turnaround.org/

September 26, 2005
   TURNAROUND MANAGEMENT ASSOCIATION
      Luncheon Meeting
         Greensboro, North Carolina
            Contact: 704-926-0359 or http://www.turnaround.org/

September 27, 2005
   TURNAROUND MANAGEMENT ASSOCIATION
      Networking at the Yard
         Camden Yards, Baltimore, Maryland
            Contact: 410-560-0077 or http://www.turnaround.org/

September 28, 2005
   NEW YORK STATE SOCIETY OF CPAs
      Half- Day Bankruptcy Conference
         19th Floor, FAE Conference Center
            3 Park Avenue, at 34th Street, New York, New York
               Contact:  1-800-537-3635; http://www.nysscpa.org/

September 28, 2005
   TURNAROUND MANAGEMENT ASSOCIATION
      Joint CFA/RMA/TMA Networking Reception
         Woodbridge Hilton, Iselin, New Jersey
            Contact: 908-575-7333; http://www.turnaround.org/

September 28-30, 2005
   PRACTISING LAW INSTITUTE
      Tax Strategies for Corporate Acquisitions, Dispositions,
         Spin-Offs, Joint Ventures, Financings, Reorganizations &
            Restructurings
               New York, New York
                  Contact: http://www.pli.edu/

September 28, 2005
   TURNAROUND MANAGEMENT ASSOCIATION
      The 2005 Bankruptcy Amendments Seminar: The Law of Intended
         and Unintended Consequences
            Woodbridge Hilton, Iselin, New Jersey
               Contact: http://www.turnaround.org/

September 28, 2005
   CONTINUING EDUCATION OF THE BAR
      Bankruptcy Reform: Changing the Ground Rules for Personal
         & Small Business Bankruptcy Practice
            San Diego, California
               Contact: http://www.ceb.com/;1-800-232-3444

September 29, 2005
   ASSOCIATION OF INSOLVENCY & RESTRUCTURING ADVISORS
      West Coast Corporate Restructuring Conference
         Grand Hyatt on Union Square, San Francisco, California
            Contact: http://www.airacira.org/

October 1, 2005
   CONTINUING EDUCATION OF THE BAR
      Bankruptcy Reform: Changing the Ground Rules for Personal
         & Small Business Bankruptcy Practice
            Sacramento, California
               Contact: http://www.ceb.com/;1-800-232-3444

October 1, 2005
   CONTINUING EDUCATION OF THE BAR
      Selected Issues in Bankruptcy Practice
         Sacramento, California
            Contact: http://www.ceb.com/;1-800-232-3444

October 6, 2005
   FINANCIAL RESEARCH ASSOCIATES LLC
      Distressed Debt Summit
         New York, New York
            Contact: http://www.frallc.com/

October 7, 2005
   AMERICAN BANKRUPTCY INSTITUTE
      Views from the Bench
         Georgetown University Law Center, Washington, D.C.
            Contact: 1-703-739-0800; http://www.abiworld.org/

October 12, 2005
   TURNAROUND MANAGEMENT ASSOCIATION
      Breakfast Meeting
         Marriott Hotel, Tyson's Corner, Virginia
            Contact: 703-912-3309; http://www.turnaround.org/

October 18, 2005
   TURNAROUND MANAGEMENT ASSOCIATION
      TBA [Upstate New York]
         Rochester, New York
            Contact: 716-440-6615; http://www.turnaround.org/

October 19, 2005
   TURNAROUND MANAGEMENT ASSOCIATION
      South Florida Dinner
         Venue to be announced
            Contact: http://www.turnaround.org/

October 19-23, 2005
   TURNAROUND MANAGEMENT ASSOCIATION
      2005 Annual Convention
         Chicago Hilton & Towers, Chicago, Illinois
            Contact: 312-578-6900; http://www.turnaround.org/

October 20, 2005
   TURNAROUND MANAGEMENT ASSOCIATION
      Colorado TMA Breakfast
         The Oxford Hotel, Denver, Colorado
            Contact: 303-457-2119; http://www.turnaround.org/

October 25, 2005
   TURNAROUND MANAGEMENT ASSOCIATION
      Tampa Luncheon
         Centre Club, Tampa, Florida
            Contact: http://www.turnaround.org/

October 27, 2005
   TURNAROUND MANAGEMENT ASSOCIATION
      Informal Networking *FREE Reception for Members*
         The Davenport Press Restaurant, Mineola, New York
            Contact: 516-465-2356; http://www.turnaround.org/

November 1-2, 2005
   INTERNATIONAL WOMEN'S INSOLVENCY & RESTRUCTURING CONFEDERATION
      IWIRC 2005 Fall Conference
         San Antonio, Texas
            Contact: http://www.iwirc.com/

November 2, 2005
   ASSOCIATION OF INSOLVENCY & RESTRUCTURING ADVISORS
      AIRA/NCBJ Dessert Reception
         Marriott Riverwalk Hotel, San Antonio, Texas
            Contact: 541-858-1665 or http://www.airacira.org/

November 2-4, 2005
   PRACTISING LAW INSTITUTE
      Tax Strategies for Corporate Acquisitions, Dispositions,
         Spin-Offs, Joint Ventures, Financings, Reorganizations &
            Restructurings
               Beverly Hills, California
                  Contact: http://www.pli.edu/

November 2-5, 2005
   NATIONAL CONFERENCE OF BANKRUPTCY JUDGES
      Seventy Eighth Annual Meeting
         San Antonio, Texas
            Contact: http://www.ncbj.org/

November 3-4, 2005
   BEARD GROUP & RENAISSANCE AMERICAN CONFERENCES
      Second Annual Conference on Physician Agreements and
         Ventures
            Successful Strategies for Negotiating Medical    
               Transactions and Investments
                  The Millennium Knickerbocker Hotel, Chicago,       
                     Illinois
                        Contact: 903-595-3800; 1-800-726-2524;    
                           http://www.renaissanceamerican.com/

November 7-8, 2005
   STRATEGIC RESEARCH INSTITUTE
      Seventh Annual Distressed Debt Investing Forum West
         Venetian Resort Hotel Casino, Las Vegas, Nevada
            Contact: http://www.srinstitute.com/

November 9, 2005
   TURNAROUND MANAGEMENT ASSOCIATION
      Breakfast Meeting
         The Center Club, Baltimore, Maryland
            Contact: 703-912-3309; http://www.turnaround.org/

November 10, 2005
   TURNAROUND MANAGEMENT ASSOCIATION
      Second Annual Australian TMA Conference
         Sebel Pier One, Sydney, Australia
            Contact: http://www.turnaround.org/

November 10, 2005
   TURNAROUND MANAGEMENT ASSOCIATION
      Second Annual Australian TMA Conference
         Sydney, Australia
            Contact: 9299-8477; http://www.turnaround.org/

November 11, 2005
   AMERICAN BANKRUPTCY INSTITUTE
      Detroit Consumer Bankruptcy Workshop
         Wayne State University, Detroit, Michigan
            Contact: 1-703-739-0800; http://www.abiworld.org/

November 11-13, 2005
   AMERICAN BANKRUPTCY INSTITUTE
      Corporate Restructuring Competition
         Kellogg School of Management, NWU, Evanston, Illinois
            Contact: 1-703-739-0800; http://www.abiworld.org/

November 14, 2005
   TURNAROUND MANAGEMENT ASSOCIATION
      Workout Workshop
         Long Island, New York
            Contact: 312-578-6900; http://www.turnaround.org/

November 15, 2005
   TURNAROUND MANAGEMENT ASSOCIATION
      Bankruptcy Judges Panel
    Pittsburgh, Pennsylvania
            Contact: http://www.turnaround.org/

November 15, 2005
   TURNAROUND MANAGEMENT ASSOCIATION
      Speaker/Dinner Event
         Fairmont Royal York Hotel, Toronto, ON
            Contact: http://www.turnaround.org/

November 17, 2005
   TURNAROUND MANAGEMENT ASSOCIATION
      TBA [Upstate New York]
         Buffalo, New York
            Contact: 716-440-6615; http://www.turnaround.org/

November 17, 2005
   TURNAROUND MANAGEMENT ASSOCIATION
      Colorado TMA Breakfast
         The Oxford Hotel, Denver, Colorado
            Contact: 303-457-2119; http://www.turnaround.org/

November 17, 2005
   ASSOCIATION OF INSOLVENCY & RESTRUCTURING ADVISORS
      Networking Cocktail Reception
         New York, New York
            Contact: 541-858-1665 or http://www.airacira.org/

November 28-29, 2005
   BEARD GROUP & RENAISSANCE AMERICAN CONFERENCES
      Twelfth Annual Conference on Distressed Investing
         Maximizing Profits in the Distressed Debt Market
            The Essex House, New York, New York
               Contact: 903-595-3800; 1-800-726-2524;  
                  http://www.renaissanceamerican.com/

November 29, 2005
   TURNAROUND MANAGEMENT ASSOCIATION
      Orlando Luncheon
         Citrus Club, Orlando, Florida
            Contact: http://www.turnaround.org/

December 1, 2005
   AMERICAN BANKRUPTCY INSTITUTE
      Bankruptcy Fundamentals: Nuts & Bolts for Young
         Practitioners
            Hyatt Grand Champions Resort, Indian Wells, California
               Contact: 1-703-739-0800; http://www.abiworld.org/

December 1-3, 2005
   AMERICAN BANKRUPTCY INSTITUTE
      Winter Leadership Conference
         Hyatt Grand Champions Resort, Indian Wells, California
            Contact: 1-703-739-0800; http://www.abiworld.org/

December 5-6, 2005
   MEALEYS PUBLICATIONS
      Asbestos Bankruptcy Conference
          Ritz-Carlton, Battery Park, New York, New York
            Contact: http://www.mealeys.com/

December 8, 2005
   TURNAROUND MANAGEMENT ASSOCIATION
      Holiday Gathering & Help for the Needy *FREE to Members*
         Mack Hall at Hofstra University, Hempstead, New York
            Contact: 516-465-2356; http://www.turnaround.org/

December 8, 2005
   TURNAROUND MANAGEMENT ASSOCIATION
      Annual Board of Directors Meeting
         Rochester, New York
            Contact: 716-440-6615; http://www.turnaround.org/

December 12-13, 2005
   PRACTISING LAW INSTITUTE
      Understanding the Basics of Bankruptcy & Reorganization
          New York, New York
            Contact: http://www.pli.edu/

December 14, 2005
   TURNAROUND MANAGEMENT ASSOCIATION
      Breakfast Meeting
         Marriott Hotel, Tyson's Corner, Virginia
            Contact: 703-912-3309; http://www.turnaround.org/

January 26-28, 2006
   AMERICAN BANKRUPTCY INSTITUTE
      Rocky Mountain Bankruptcy Conference
         Westin Tabor Center, Denver, Colorado
            Contact: 1-703-739-0800; http://www.abiworld.org/

February 9-10, 2006
   AMERICAN BANKRUPTCY INSTITUTE
      International Insolvency Symposium
         Eden Roc, Miami, Florida
            Contact: 1-703-739-0800; http://www.abiworld.org/

March 2-3, 2006
   ASSOCIATION OF INSOLVENCY & RESTRUCTURING ADVISORS
      Legal and Financial Perspectives on Business Valuations &
         Restructuring (VALCON)
            Four Seasons Hotel, Las Vegas, Nevada
               Contact: http://www.airacira.org/

March 2-5, 2006
   NATIONAL ASSOCIATION OF BANKRUPTCY TRUSTEES
      2006 NABT Spring Seminar
         Sheraton Crescent Hotel, Phoenix, Arizona
            Contact: http://www.pli.edu/

March 9, 2006
   AMERICAN BANKRUPTCY INSTITUTE
      Nuts & Bolts for Young Practitioners
         Century Plaza, Los Angeles, California
            Contact: 1-703-739-0800; http://www.abiworld.org/

March 10, 2006
   AMERICAN BANKRUPTCY INSTITUTE
      Bankruptcy Battleground West
         Century Plaza, Los Angeles, California
            Contact: 1-703-739-0800; http://www.abiworld.org/

March 22-25, 2006
   TURNAROUND MANAGEMENT ASSOCIATION
      TMA Spring Conference
         JW Marriott Desert Ridge, Phoenix, Arizona
            Contact: http://www.turnaround.org/

March 30 - April 1, 2006
   AMERICAN LAW INSTITUTE - AMERICAN BAR ASSOCIATION
      Partnerships, LLCs, and LLPs: Uniform Acts, Taxation,
         Drafting, Securities, and Bankruptcy
            Scottsdale, Arizona
               Contact: 1-800-CLE-NEWS; http://www.ali-aba.org/

April 6-7, 2006
   BEARD GROUP & RENAISSANCE AMERICAN CONFERENCES
      The Seventh Annual Conference on Healthcare Transactions
         Successful Strategies for Mergers, Acquisitions,
            Divestitures, and Restructurings
               The Millennium Knickerbocker Hotel, Chicago,
                  Illinois
                     Contact: 903-595-3800; 1-800-726-2524;       
                        http://www.renaissanceamerican.com/

April 18-22, 2006
   AMERICAN BANKRUPTCY INSTITUTE
      Annual Spring Meeting
         JW Marriott, Washington, D.C.
            Contact: 1-703-739-0800; http://www.abiworld.org/

May 4-6, 2006
   AMERICAN LAW INSTITUTE - AMERICAN BAR ASSOCIATION
      Fundamentals of Bankruptcy Law
         Chicago, Illinois
               Contact: 1-800-CLE-NEWS; http://www.ali-aba.org/

May 8, 2006
   AMERICAN BANKRUPTCY INSTITUTE
      NYC Bankruptcy Conference
         Millennium Broadway, New York, New York
            Contact: 1-703-739-0800; http://www.abiworld.org/

May 18-19, 2006
   BEARD GROUP & RENAISSANCE AMERICAN CONFERENCES
      Third Annual Conference on Distressed Investing Europe
         Maximizing Profits in the European Distressed Debt Market
            Le Meridien Piccadilly Hotel, London, UK
               Contact: 903-595-3800; 1-800-726-2524;
                  http://www.renaissanceamerican.com/

June 7-10, 2006
   ASSOCIATION OF INSOLVENCY & RESTRUCTURING ADVISORS
      22nd Annual Bankruptcy & Restructuring Conference
         Grand Hyatt, Seattle, Washington
            Contact: http://www.airacira.org/

June 15-18, 2006
   AMERICAN BANKRUPTCY INSTITUTE
      Central States Bankruptcy Workshop
         Grand Traverse Resort, Traverse City, Michigan
            Contact: 1-703-739-0800; http://www.abiworld.org/

June 22-23, 2006
   BEARD GROUP & RENAISSANCE AMERICAN CONFERENCES
      Ninth Annual Conference on Corporate Reorganizations
         Successful Strategies for Restructuring Troubled
            Companies
               The Millennium Knickerbocker Hotel, Chicago,   
                  Illinois
                     Contact: 903-595-3800; 1-800-726-2524;    
                        http://www.renaissanceamerican.com/

July 13-16, 2006
   AMERICAN BANKRUPTCY INSTITUTE
      Northeast Bankruptcy Conference
         Newport Marriott, Newport, Rhode Island
            Contact: 1-703-739-0800; http://www.abiworld.org/

July 26-29, 2006
   AMERICAN BANKRUPTCY INSTITUTE
      Southeast Bankruptcy Workshop
         The Ritz Carlton Amelia Island, Amelia Island, Florida
            Contact: 1-703-739-0800; http://www.abiworld.org/

September 7-9, 2006
   AMERICAN BANKRUPTCY INSTITUTE
      Southwest Bankruptcy Conference
         Wynn Las Vegas, Las Vegas, Nevada
            Contact: 1-703-739-0800; http://www.abiworld.org/

October 11-14, 2006
   TURNAROUND MANAGEMENT ASSOCIATION
      2006 Annual Conference
         Milleridge Cottage, Long Island, New York
            Contact: 312-578-6900; http://www.turnaround.org/

October 25-28, 2006
   NATIONAL CONFERENCE OF BANKRUPTCY JUDGES
      National Conference of Bankruptcy Judges
         New Orleans, Louisiana
            Contact: http://www.ncbj.org/

November 30-December 2, 2006
   AMERICAN BANKRUPTCY INSTITUTE
      Winter Leadership Conference
         Hyatt Regency at Gainey Ranch, Scottsdale, Arizona
            Contact: 1-703-739-0800; http://www.abiworld.org/

April 11-15, 2007
   AMERICAN BANKRUPTCY INSTITUTE
      ABI Annual Spring Meeting
         J.W. Marriott, Washington, DC
            Contact: 1-703-739-0800; http://www.abiworld.org/

June 6-9, 2007
   ASSOCIATION OF INSOLVENCY & RESTRUCTURING ADVISORS
      23rd Annual Bankruptcy & Restructuring Conference
         Westin River North, Chicago, Illinois
            Contact: http://www.airacira.org/

October 10-13, 2007
   NATIONAL CONFERENCE OF BANKRUPTCY JUDGES
      National Conference of Bankruptcy Judges
         Orlando, Florida
            Contact: http://www.ncbj.org/

December 6-8, 2007
   AMERICAN BANKRUPTCY INSTITUTE
      Winter Leadership Conference
         Westin Mission Hills Resort, Rancho Mirage, California
            Contact: 1-703-739-0800; http://www.abiworld.org/

September 24-27, 2008
   NATIONAL CONFERENCE OF BANKRUPTCY JUDGES
      National Conference of Bankruptcy Judges
         Scottsdale, Arizona
            Contact: http://www.ncbj.org/

2009 (TBA)
   NATIONAL CONFERENCE OF BANKRUPTCY JUDGES
      National Conference of Bankruptcy Judges
         Las Vegas, Nevada
            Contact: http://www.ncbj.org/

2010 (TBA)
   NATIONAL CONFERENCE OF BANKRUPTCY JUDGES
      National Conference of Bankruptcy Judges
         New Orleans, Louisiana
            Contact: http://www.ncbj.org/

The Meetings, Conferences and Seminars column appears in the
Troubled Company Reporter each Wednesday. Submissions via e-mail
to conferences@bankrupt.com are encouraged.

                          *********

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 ***