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

             Wednesday, June 13, 2001, Vol. 5, No. 115

                             Headlines

APPLE ORTHODONTIX: Texas Court Confirms Reorganization Plan
AQUIS COMM.: Executes Forbearance Agreement With Senior Lenders
BOB PEDEN: Car Dealer Files for Chapter 7 Bankruptcy Protection
BOB PEDEN: Chapter 7 Case Summary
BRIDGE INFORMATION: Wants To Sell Remaining Assets to SunGard

BRIDGE INFO: Holmberg Balks At Motion To Junk Severance Contract
CALIFORNIA PACIFIC: Investors Offer to Buy Assets For $11.5 Mil
CRESCENT SERVICES: Flooding Delays Berens' Acquisition of Assets
DERBY CYCLE: Taps Lazard Freres To Explore Options To Repay Debt
EDISON INTERNATIONAL: Mission Energy To Offer $1.2 Billion Notes

EDISON INTERNATIONAL: S&P Rates Mission Energy's $1.2B Notes BB-
EDISON INTERNATIONAL: CEO Optimistic Lawmakers Will Save SCE
ETS PAYPHONES: Committee Describes Status of Turnaround Efforts
FINOVA GROUP: Engages Rothschild Inc. As Financial Advisor
GENESIS HEALTH: Capital Structure & Governance Of New Debtors

IMPERIAL SUGAR: Summary Of Second Amended Plan Of Reorganization
INTEGRATED HEALTH: Rejecting Nine More Rotech Leases
KITTY HAWK: Hearing On Plan Confirmation is on August 1, 2001
LTV CORP: Seeks Bankruptcy Court Help to Modify Labor Agreements
LTV CORP: USWA Says Union Plan Would Save Bankrupt Steelmaker

LTV: Cleveland Reps Oppose Action to Dissolve Union Contract
MARKETING SPECIALISTS: Acosta Hires 1,700 Former Employees
MIDLAND FOOD: Opposes Order Terminating Exclusivity
MIDLAND FOOD: Reaches Accord on Pizza Hut Franchise Agreements
NUMATICS INC.: S&P Puts B and CCC+ Debt Ratings on Watch

PILLOWTEX: Selling Loom Equipment For $1.87M To Textile Trading
POTLATCH: Fitch Lowers Senior Unsecured Debt Rating To BBB-
PROVANT: Long-Term Shareholders Form Committee to Restore Value
RIVERWOOD HOLDING: Unit Plans To Sell Securities To Pay Debt
SAFETY-KLEEN: Resolves Claims Dispute With Toyota

SENIOR HOUSING: Commences $50 Million Trust Preferred Offering
STELLEX TECHNOLOGIES: Files Consolidated Plan of Reorganization
VIDEO UPDATE: Court Approves $5MM DIP Loan From Movie Gallery
VLASIC FOODS: US Trustee Appoints Unsecured Creditors' Committee
WARNACO GROUP: Files Chapter 11 Petition in S.D. New York

WARNACO GROUP: Case Summary & 30 Largest Unsecured Creditors
WARNACO GROUP: BCSI Providing Gavel-to-Gavel Newsletter Coverage
WARNACO GROUP: Obtains Court Nod for $600 Million DIP Financing
WHEELING-PITTSBURGH: Settles American Electric Power Disputes
WHEELING-PITTSBURGH: Steel Loan Board Director Plans a Visit

* Meetings, Conferences and Seminars

                             *********

APPLE ORTHODONTIX: Texas Court Confirms Reorganization Plan
-----------------------------------------------------------
In the case of Apple Orthodontix, the US Bankruptcy Court,
Southern District of Texas, entered an order confirming a plan
of reorganization on May 25, 2001.


AQUIS COMM.: Executes Forbearance Agreement With Senior Lenders
---------------------------------------------------------------
Aquis Communications Group, Inc. (OTC Bulletin Board: AQIS)
announced the successful completion of the first steps in its
financial and operational restructuring plan.

First, the Company has successfully negotiated a series of
Forbearance Agreements with its senior secured lender, Finova
Capital Corporation, and with its Convertible Debenture holder,
AMRO International.  The Agreements cover all of the Company's
institutional indebtedness.  Under the terms of the Agreements,
Finova and AMRO mutually agree not to take any action with
respect to the Company's defaulted institutional debt until
January 1, 2002, subject to certain conditions, including
satisfactory performance under the Company's revised strategic
business plan.

Second, the Company intends to proceed aggressively in the
implementation of its revised business plan which is focused
primarily on the growth of its traditional one-way paging
business in the Company's key Northeast and Mid- Atlantic
markets.  The Company expects to achieve this growth both
through internal generation of additional revenues and through
accretive acquisitions in these markets.  In addition,
consistent with its focused business strategy, the Company is
also investigating disposing non-core assets.  "We believe that
by focusing on our strengths in our core markets, the Company
can improve its market share in the one-way paging business,"
stated Keith J. Powell, Aquis President and Chief Operating
Officer.

Finally, in conjunction with adopting a focused business
strategy, the Company has also implemented further cost saving
actions, including workforce and salary reductions, which should
reduce the Company's operating expenses by approximately $1.5
million per year.  "This action, combined with the previously
announced streamlining efforts in February, has the effect of
reducing the Company's overhead by approximately $2.5 million
per year.  In addition, this action should free up resources to
assist the Company achieve its revenue objectives," stated Mr.
Powell.

The Company will also continue in its ongoing efforts to
negotiate appropriate settlement and forbearances with its other
trade and related creditors to satisfy the terms of the
Forbearance Agreements with its institutional creditors and to
position the Company to successfully execute its financial
restructuring and revised strategic plan.  "With virtually all
of the Company's major competitors in bankruptcy or in financial
difficulty, Aquis has a unique opportunity to strengthen its
position in the markets it serves.  With this positive vote of
confidence from our institutional creditors, our focused
business strategy and the operational changes which we have
implemented, we believe that we have taken a major step to
position Aquis for increasing growth and profitability," stated
John B. Frieling, Aquis Chief Executive Officer.

Aquis Communications Group, Inc. currently offers two-way
interactive messaging as well as national, regional and local
messaging services to customers in the Northeast, Mid-Atlantic
and Midwest areas.  The Company also offers cellular, PCS and
Internet access.  Headquartered in Parsippany, NJ, Aquis
Communications maintains offices in Freehold and Mt. Laurel, NJ;
Baltimore, MD; Richmond, Norfolk and Tyson's Corner, VA and
Chicago, IL.  For more information on Aquis Communications
visit: http://www.aquiscommunications.com.


BOB PEDEN: Car Dealer Files for Chapter 7 Bankruptcy Protection
---------------------------------------------------------------
Clendenin, W. Va.-based Bob Peden Chevrolet, which has been
closed for two weeks, has filed for chapter 7 bankruptcy
protection, according to The Charleston Gazette. The car
dealership listed 114 creditors on its initial bankruptcy claim,
originally filed on May 30, but did not announce how much money
it owes. The first creditors' meeting will be held on June 22.
(ABI World, June 11, 2001)


BOB PEDEN: Chapter 7 Case Summary
---------------------------------
Debtor: Bob Peden Chevrolet, Inc.
         PO Box 499
         311 Elk River Rd.
         South Clendenin, WV 25045

Chapter 7 Petition Date: May 30, 2001

Court: Southern District of West Virginia (Charleston)

Bankruptcy Case No.: 01-21391

Judge: Ronald G. Pearson

Debtor's Counsel: Richard M. Francis, Esq.
                   Bowles Rice Mcdavid Graff & Love PLLC
                   P.O. Box 1386
                   Charleston, WV 25325-1386
                   Tel: (304) 347-1106

Estimated Assets: $500,000 to $1 million

Estimated Debts: $500,000 to $1 million


BRIDGE INFORMATION: Wants To Sell Remaining Assets to SunGard
-------------------------------------------------------------
St. Louis, Mo.-based Bridge Information Systems Inc. on Friday
filed a motion to sell some of its remaining assets to SunGard
Data Systems Inc. for $16.5 million in cash, according to Dow
Jones.  SunGard made an offer to buy Bridge's retail broker
information business, most of its value-added-reseller business
and its equity interest in Prescient Markets.  Objections to the
sale must be filed by June 20.  Attorneys for Bridge will
present the motion to bankruptcy Judge David P. McDonald during
a June 22 hearing.

Bridge, which provides financial information and related
services, filed for chapter 11 bankruptcy protection on Feb. 15.
After an auction process between Reuters Groups PLC and SunGard,
Reuters was named the winning bidder for most of Bridge's
assets, including Bridge Information Systems in North America.
(ABI World, June 11, 2001)


BRIDGE INFO: Holmberg Balks At Motion To Junk Severance Contract
----------------------------------------------------------------
William Holmberg, Bridge Information Systems, Inc.'s former
senior vice-president of Americas Sales and Marketing, objected
to the Debtors' motion to reject his severance contract. Mr.
Holmberg said Bridge still owes him $125,000 under the severance
agreement.

Mr. Holmberg started working for Bridge on August 1995. On
January 7, Bridge informed Mr. Holmberg that they wish to
terminate his employment. Negotiations immediately followed for
the terms of the Severance Agreement, which was inked a month
later.

Under the agreement, Mr. Holmberg's employment ends on March 31.
But before that, Mr. Holmberg was asked to perform one final
task. Bridge had committed to purchase advertising time during a
golf tournament on CBS Television, and Mr. Holmberg was directed
to find another company that was willing to assume $600,000 of
that obligation.

But Mr. Holmberg said he did more than that, since he was able
to relieve Bridge of more than $1.6 million in obligations to
CBS Television over the next two years. His successful
performance triggered a provision in the Severance Agreement
that extended his employment until April 30. According to Mr.
Holmberg, this extension entitles him to receive salary and
benefits for a longer period of time under the Severance
Agreement.

However, the Debtors contended that Holmberg's Severance
Agreement is an executory contract. The Debtors insist they are
entitled to exercise their business judgement and reject the
Severance Agreement.

Mr. Holmberg's lawyer, Robert T. Barnard, Esq., at Gould &
Wilkie LLP, in New York, disagreed. Mr. Holmberg's Severance
Agreement is not executory, Mr. Barnard said, since there is no
obligation on the part of Mr. Holmberg that remains to be
performed. The Debtors' motion, Mr. Barnard argued, is
unsupported and unsupportable. Rejection of Mr. Holmberg's
severance contract, under which Debtors' liabilities amount to
slightly more than $100,000, would only expose the estate to a
$1.6 million priority claim, Mr. Barnard warned.

The Debtors' counsel, Gregory D. Willard, Esq., at Bryan Cave
LLP, in St. Louis, Missouri, insisted that the severance
agreement is an "executory contract" because contractual
obligations of both Bridge and Mr. Holmberg remained unperformed
as of the Petition Date. Mr. Willard contended that the
severance agreement dated February 7 started merely eight days
before the Petition Date and this hardly provided the
opportunity to fully accomplish everything contemplated by the
agreement.

Obligations remained unperformed at the Petition Date on both
sides, Mr. Willard explained:

      (a) Mr. Holmberg was obligated as a Bridge employee to make
himself available through March 31 to assist with key Bridge
accounts (with extensions of such obligations through April 30
under certain circumstances);

      (b) Mr. Holmberg was obligated not to use, publish or
otherwise disclose any trade secrets, proprietary or
confidential information belonging to Bridge or its clients or
the terms of the Severance Agreement; and

      (c) Mr. Holmberg was obligated to cooperate with Bridge and
its counsel with regard to any legal matters relating to
business conducted by Mr. Holmberg on behalf of Bridge;

          and

      (x) Bridge was obligated to provide office space for Mr.
Holmberg through the termination of his employment;

      (y) Bridge had to provide a paid apartment for Mr. Holmberg
through the termination of his employment; and

      (z) Bridge had the obligation to make certain specified
payments to Mr. Holmberg, provide benefits and honor the options
specified in the Severance Agreement.

But, Mr. Barnard maintained, there is no more substantial
performance required from Mr. Holmberg. It is Bridge that failed
to honor their side of the bargain.

If Judge McDonald rules in favor of Mr. Holmberg, the Debtors
make it clear that they right their rights to seek to avoid
about $60,000 of prepetition payments made to Mr. Holmberg.
Assuming that the Severance Agreement is an executory contract
of Bridge, Holmberg's claim becomes a prepetition, nonpriority,
unsecured claim. Mr. Willard suggested that Mr. Holmberg should
file a proof of claim in these bankruptcy cases as his sole
remedy.

                            * * *

In response to a limited objection filed by Bridge's former
Chairman and Chief Executive Officer Thomas M. Wendel, Judge
McDonald ordered the Debtors to continue providing health
benefits coverage to Mr. Wendel and his wife, Deborah
Butterfield, pursuant to the terms of a Letter Agreement entered
into by Mr. Wendel and Bridge in June 1998, on the conditions
that:

      (1) Mr. Wendel shall fully and timely reimburse Bridge for
102% of the actual cost to Bridge of the benefits, as reasonably
determined in good faith by Bridge with notice to Mr. Wendel, at
such times as Bridge shall reasonably request, but not more
frequently than Bridge actually makes payments for the benefits
to the Debtors' health benefits coverage provider;

      (2) Mr. Wendel shall fully and timely reimburse Bridge for
any and all increases in the Debtors' cost of providing health
benefits coverage to the Debtors' other health benefits
recipients that are attributable to providing the benefits to
the benefit recipients, as reasonably determined in good faith
by Bridge with notice to Mr. Wendel, at such times as Bridge
shall reasonably request;

      (3) The provider shall not have terminated the benefits;

      (4) And, this order shall not constitute any binding
precedent regarding the executory nature of the Letter
Agreement, which the Debtors reserve the right to reject.

Mr. Wendel is 65 years old and it is difficult, if not
impossible, for him to obtain health care coverage. Ms.
Butterfield is a transplant recipient and uninsurable without
continued coverage through United Healthcare.

The court approved the rejection of the Debtors' executory
severance contracts with Timothy Cox, Paul Lowe, and Richard
Williams. Wendel's severance contract was likewise rejected
except for the provision on health care coverage.

As previously reported, Bridge sought to reject the severance
contracts with its former executive employees because the
Debtors find them burdensome, unprofitable, not necessary to the
ongoing operations, and without any corresponding material
benefit. The total cost to the Debtors for the Severance
Contracts is in excess of $815,000. (Bridge Bankruptcy News,
Issue No. 8; Bankruptcy Creditors' Service, Inc., 609/392-0900)


CALIFORNIA PACIFIC: Investors Offer to Buy Assets For $11.5 Mil
---------------------------------------------------------------
Bankrupt California Pacific Rice Milling said that it has a
buyer for its assets, according to The Sacramento Bee. A group
of investors headed by Tom Atkinson has offered to acquire the
rice milling business, one of California's largest, for $11.5
million. California Pacific's largest creditor, Union Bank of
California, has approved the sale. U.S. Bankruptcy Judge Michael
McManus, who must approve the purchase, will consider the matter
at a hearing on June 25. (ABI World, June 11, 2001)


CRESCENT SERVICES: Flooding Delays Berens' Acquisition of Assets
----------------------------------------------------------------
The massive flooding in Houston the past weekend caused by
tropical storm Allison has delayed the approval of Berens
Industries (OTCBB:BEII) pending acquisition of Crescent Services
Corporation's business operations. BEII signed a Letter of
Intent on April 16, 2001 to acquire certain assets and
operations from Crescent Services Corporation, which had filed
bankruptcy in December. All State and Federal courts in Houston
are temporarily closed. The hearing scheduled for today has been
postponed.

"Once the acquisition is approved and behind us, expected new
capital funding will give us a clean slate going forward where
Crescent can build upon the infrastructure that it has
established over the past several years without high overhead
and expensive carrying costs," stated Marc I. Berens, Chairman.
For the five months ending May 31, 2001, Crescent, as a Debtor
in Possession, reported approximate revenues of $790,000 with an
estimated loss of approximately $94,000 before interest,
factoring costs and estimated depreciation. For the year ending
December 2000, Crescent reported approximate revenues of $2.8
million and $7 million in losses.

                   About Berens Industries, Inc.

Berens Industries is pioneering the development of streaming
application servers that are deployable as rent-based solutions
hosted and co-marketed by leaders in the Application Service
Provider (ASP) industry. Product lines provide bundled packages
of managed servers, global connectivity, scaleable bandwidth,
applications, and transactional systems. Ongoing research and
development is being conducted to deliver streaming application
servers that bind relational databases and transactional systems
with interactive streaming media.


DERBY CYCLE: Taps Lazard Freres To Explore Options To Repay Debt
----------------------------------------------------------------
The Derby Cycle Corporation is currently in the process of
reviewing its business and exploring all alternatives available
to operate its business and repay its existing indebtedness. The
Company is currently and has been in default under its DM209.4
million ($93.9 million) senior secured revolving credit
facility, and is in default under and failed to make its
scheduled interest payments on its $100 million principal amount
of 10.0% senior notes and its DM110 million principal amount of
9.38% senior notes that were due on May 15, 2001. The Company
has a 30-day grace period to make the interest payments under
the terms of the indentures governing the Senior Notes. While
the Company remains in default of the covenants contained in the
Revolving Credit Facility, there can be no assurance that the
interest payments will be made by the end of the grace period.

The Company has retained Lazard Freres & Co. L.L.C. as its
financial advisor, to render financial advisory services. Lazard
is exploring all alternatives available to the Company in order
to repay the Revolving Credit Facility, including refinancing
the Revolving Credit Facility with asset based lenders, the sale
of some or all assets and operations and the restructuring of
other indebtedness. In addition, the Company has been working
with an informal committee of holders of more than 50% of the
principal amount of its Senior Notes for the purposes of
negotiating a consensual restructuring of its outstanding
securities. The Company has advised the informal committee of
noteholders that any restructuring proposal made by the Company
will (a) provide for payment in full of all obligations to the
Company's trade creditors that continue to support the Company
with customary trade credit and (b) not have any impact on the
day-to-day operations with regard to employees, customers,
suppliers, distributors and general business.

In connection with these matters, the Company has recently
received a bid from certain members of its management (led by
Mr. Alan J. Finden-Crofts, the Company's Executive Chairman and
a director) to purchase certain assets of the Company. The
Company is in the process of considering and evaluating this
bid, and is at the same time also exploring other alternatives,
as mentioned above. No assurance can be given that any
refinancing, sale, or restructuring of indebtedness is feasible
or can be successfully implemented.


EDISON INTERNATIONAL: Mission Energy To Offer $1.2 Billion Notes
----------------------------------------------------------------
Edison International (NYSE: EIX) and Edison Mission Energy
announced that Mission Energy Holding Company, a wholly-owned
subsidiary of Edison International, intends to offer $1.2
billion of its senior secured notes due 2008 to certain
qualified investors and overseas purchasers.  Mission Energy
Holding Company will be a new holding company for Edison Mission
Energy.

The notes will be secured by the common stock of Edison Mission
Energy. The net proceeds of the offering, less amounts paid into
an interest reserve account to secure payment of the first four
interest payments on the notes, will be paid as a dividend to
Mission Energy Holding Company's parent company, The Mission
Group, which will in turn loan or otherwise distribute the net
proceeds to Edison International.  Edison International will use
the funds to repay indebtedness maturing in 2001.

The notes will not be registered under the Securities Act of
1933 and may not be offered or sold in the United States absent
registration or an applicable exemption from registration
requirements.

Based in Rosemead, Calif., Edison International is the parent
company of Edison Mission Energy, Southern California Edison,
Edison Capital, Edison O&M Services and Edison Enterprises.


EDISON INTERNATIONAL: S&P Rates Mission Energy's $1.2B Notes BB-
----------------------------------------------------------------
Standard & Poor's assigned its double-'B'-minus rating to
Mission Energy Holding Co.'s proposed offering of $1.2 billion
senior secured notes due June 15, 2008.

As this new rating applies only to a debt issue, instead of an
issuer, the rating does not carry an outlook.

The notes are secured by a first lien on the capital stock of
its wholly owned subsidiary, Edison Mission Energy (EME), and by
an interest escrow account. This account will be funded by a
portion of the note proceeds in an amount sufficient to provide
two years' worth of interest payments on the notes. After the
notes are issued, Standard & Poor's expects to raise the
corporate credit rating of Edison International (EIX), Mission
Energy Holding's parent (EIX), to triple-'C'-plus, while leaving
it on CreditWatch with negative implications. The upgrade will
reflect the retirement of a substantial amount of EIX debt
through the issuance of these secured notes.

Mission Energy Holding was created by its indirect and ultimate
parent EIX for the exclusive purpose of issuing the notes and
enabling EIX to repay debt obligations that mature in 2001.
These obligations include $618 million of funded bank debt that
is due June 30, 2001; $250 million of floating rate notes due
July 2001; and $350 million of floating rate notes due November
2001.

Mission Energy Holding is structured as an intermediate holding
company between EIX's direct subsidiary, The Mission Group, and
its subsidiary, EME. The notes issued by Mission Energy Holding
will be collateralized by its principal assets, the capital
stock of EME and the funds, which will be deposited in the
escrow account. As such, the rating of Mission Energy Holding's
secured notes draws from the credit quality of EIX and EME. This
rating also incorporates the enhanced potential for ultimate
recovery provided by the value of the stock. This value is based
on various sensitivity scenarios, which demonstrate a sufficient
level of overcollateralization.

The notes issued by Mission Energy Holding are rated higher than
EIX, whose corporate credit rating is expected to be raised to
triple-'C'-plus from double-'C' upon the successful sale of the
secured notes. This rating differential reflects the structural
features of Mission Energy Holding, including, among others, the
company's single-purpose, bankruptcy-remote characteristics and
the pledge of all of its assets for the benefit of the
noteholders. Standard & Poor's has concluded that these
structural features are effective to "ring-fence" Mission Energy
Holding from its immediate and ultimate parents. These features,
some of which are described below in detail as they pertain to
the earlier ring-fencing of EME, reduce, but by no means
eliminate, the likelihood of a bankruptcy filing of Mission
Energy Holding in the event of such a filing by EIX. Mission
Energy Holding has satisfied Standard & Poor's ring-fencing
criteria; however, the economic disincentives that create
barriers to filing Mission Energy Holding are considerably less
compelling than those that exist for EME, which explains a
rating separation from EIX that is more constrained for Mission
Energy Holding than it is for EME.

The prospects of a bankruptcy filing by or against Southern
California Edison Co. (SCE; 'D'/--/'D'), the utility owned by
EIX, and possibly EIX, remain high due to defaults by SCE of
about $931 million on debt payments and about $1 billion on
payments owed to power generators. Fixed income investors are
severely prejudiced by the prolonged absence of a definitive
solution to the utility's financial devastation. After five
months, the California legislature, which has been meeting in
emergency sessions, appears unable, or perhaps unwilling, to
reach any consensus on how, or whether, to provide SCE the
financial support it needs to recover.

In January 2001, SCE defaulted on certain debt obligations, and
the corporate credit rating of EIX was lowered to double-'C' and
placed on CreditWatch with negative implications. To date, EIX
has not defaulted on any obligations, and management has
consistently stated its strong intent to avoid any default.

In January 2001, EME amended its articles of incorporation and
bylaws in a manner to make it bankruptcy-remote from EIX. These
amendments were designed to ring-fence the company and
subsidiaries from the possible bankruptcy or further credit
degradation of EIX. Standard & Poor's ratings on EME therefore
rely principally on EME's stand-alone creditworthiness and the
economic disincentives of the parent or its creditors to attempt
to file EME into bankruptcy.

Ring-fenced subsidiaries rarely achieve ratings appreciably
higher than their parents for various economic and legal
reasons. Nonetheless, the extraordinary circumstances
surrounding the California electricity market, the economic
self-sufficiency of EME, the rationale for implementing the
ring-fencing structure, and the ring-fencing provisions
themselves allow Standard & Poor's more flexibility vis a vis
EME.

Standard & Poor's has assigned EME a rating higher than that of
EIX primarily because of Standard & Poor's conclusion that
creditors to EIX, and EIX itself, have numerous economic
incentives not to file EME into bankruptcy in the event of an
EIX bankruptcy filing. This conclusion is based on the
incremental liabilities that EME would incur from a bankruptcy
filing that would materially reduce its value to EIX creditors,
the potential loss of value of the going concern, and the fact
that generally all of EME's assets are already encumbered with
senior liens at the project level. These liabilities would be
substantial and would likely include damages due to breach of
energy trading and marketing hedges, equity commitment
guarantees, debt service reserve replenishment obligations,
lease guarantee obligations related to EME Midwest assets and
general reorganizational costs. Moreover, an EME bankruptcy
would result in a number of project level obligations that would
not be rejected in bankruptcy and that would further dilute the
financial resources available to EIX creditors. Standard &
Poor's concluded that if an otherwise financially sound EME
would file for bankruptcy, the adverse financial and contractual
consequences of such a filing would likely outweigh any
perceived advantages. As part of the ring-fencing restructuring,
EME has adopted a restriction limiting its ability to declare
dividends to EIX, and has appointed an independent manager whose
assent is required for EME to file itself into bankruptcy. The
dividend restriction can both protect and improve EME's
financial position and its ability to meet its obligations under
its guarantees.

The ring-fenced structure should protect EME in all but extreme
cases from rating downgrades that Standard & Poor's may take
regarding EIX.

For a more in-depth analysis of the business and financial
profile of EME, please refer to Standard & Poor's separate
reports on this issuer.

The $1.2 billion of debt that Mission Energy Holding is issuing
will not affect EME's credit strength. Neither will the new
holding company affect the ring-fencing structure that EIX
placed on EME earlier this year. Although dividends from EME
will service Mission Energy Holding's debt obligation, holders
of this debt have only the most residual claims on EME's cash
flow and only if EME can satisfy certain distribution and rating
maintenance tests. All of EME's senior debt, subordinated debt,
preferred securities, as well as any future debt issues and
project level obligations remain senior to Mission Energy
Holding's obligations. Moreover, although lenders to Mission
Energy Holding will have a pledge of all the outstanding stock
of EME, that assignment will in no way affect EME's operations
or financial policies, Standard & Poor's said.


EDISON INTERNATIONAL: CEO Optimistic Lawmakers Will Save SCE
------------------------------------------------------------
Edison International Chairman and chief executive John Bryson
said that he remains optimistic that the state Legislature will
pass a rescue plan to keep embattled utility unit Southern
California Edison (SoCal Edison) out of bankruptcy, according to
Dow Jones.  "I'm an optimist when it comes to the Legislature
and public officials about the steps they need to take," John
Bryson said. "The cost of getting this solved now is much
cheaper than the three or four years" it would take in
bankruptcy court.

Gov. Gray Davis and SoCal Edison signed a memorandum of
understanding (MOU) in April that would allow the utility to
recover some $3.5 billion in uncollected power costs by issuing
bonds backed by ratepayers and selling its electricity
transmission system to the state.  State Sen. Majority Leader
Richard Polanco introduced a bill last month to enact the MOU,
which needs lawmakers' approval by Aug. 15. But the MOU, largely
unchanged from an agreement in principle reached in February,
hasn't moved in the Legislature, where many lawmakers see it as
a bailout at the expense of ratepayers. (ABI World, June 11,
2001)


ETS PAYPHONES: Committee Describes Status of Turnaround Efforts
---------------------------------------------------------------
According to a letter circulated by counsel for the Official
Committee of Unsecured Creditors of ETS Payphones and its
affiliated debtors, the ETS turnaround is in progress. The
Committee is cautiously optimistic that it will be successful.
Following the Committee's action to replace management, Guy
Longobardo was appointed as new CEO effective February 26, 2001.
The Committee charged him with the tasks of determining whether
and how, if possible to make the company profitable and taking
the steps required to obtain and maximize distributions to all
creditors and leaseholders.

ETS has concluded that it is in the best interest of all
creditors and leaseholders to pursue a stand-alone plan. This
conclusion and the steps currently underway to implement the
plan have the enthusiastic support and endorsement of the
Committee.

The plan will provide for ETS to emerge from bankruptcy as an
operating and reorganized payphone company. Leaseholders will
own 100% of the stock of the reorganized company, and dividends
to the leaseholders will be payable from profits generated by
the reorganized company rather than lease payments.

Reorganized ETS will emerge from bankruptcy with no secured debt
or other claims encumbering the payphones or its other assets,
thereby maximizing the value of the equity to be owned by
leaseholders. ETS will have to raise approximately $8 million
through limited sales of specific assets.

The Committee expects that the disclosure statement will be
presented for court approval on or about July 17, 2001.


FINOVA GROUP: Engages Rothschild Inc. As Financial Advisor
----------------------------------------------------------
The FINOVA Group, Inc. applied to the Court for authority,
pursuant to sections 327(a) and 328(a) of the Bankruptcy Code
and Rule 2014(a) of the Bankruptcy Rules, for the employment of
Rothschild Inc., nunc pro tunc to April 5, 2001, as the
Company's financial advisor and investment banker.

The Debtors noted that Rothschild is a renowned financial
advisor and investment banking firm with extensive expertise and
experience in providing financial advice and investment banking
services to financially troubled companies in relation to
complex restructurings. In addition to providing financial
advice and investment banking services, Rothschild provides a
broad range of corporate advisory services, including services
relating to corporate finance, mergers and acquisitions, and
private placements of securities.

The Debtors also noted that Rothschild has an acute
understanding of the industry in which the Debtors operate.
Rothschild's experience with the financial services industry,
the Debtors believe, will enable it to provide the most
effective services available during the Debtors' chapter 11
cases and facilitate the Debtors' reorganization efforts.

The Debtors represented that the proposed employment and
retention is necessary in order to enable the Debtors to execute
faithfully their duties as debtors in possession.

As set forth in the Engagement Letter, Rothschild will provide a
broad range of financial advisory and investment banking
services to the Debtors.

Specifically, the Debtors seek to employ Rothschild to render,
among others, the following professional services:

      (1) review and analyze the Debtors' assets and the
operating and financial strategies of the Debtors;

      (2) review and analyze the business plans and financial
projections prepared by the Debtors including, but not limited
to, testing assumptions and comparing those assumptions to the
Debtors' historical trends and industry trends;

      (3) evaluate the Debtors' debt capacity in light of their
projected cash flows and assist in the determination of an
appropriate capital structure for the Debtors;

      (4) assist the Debtors and their other professionals in
reviewing the terms of any proposed Transaction, in making
responses and, if directed, in evaluating alternative proposals
for a Transaction;

      (5) determine a range of values for the Debtors and any
securities that the Debtors offer or propose to offer in
connection with a Transaction;

      (6) advise the Debtors on the risks and benefits of a
prospective Transaction with respect to the Debtors'
intermediate and long-term business prospects and strategic
alternatives to maximize the business enterprise value of the
Debtors;

      (7) review and analyze any proposals the Debtors receive
from third parties in connection with a Transaction, including,
without limitation, any proposals for debtor-in-possession
financing, as appropriate;

      (8) assist or participate in negotiations with the parties
in interest;

      (9) advise and attend meetings of third parties and
official constituencies, as necessary;

     (10) if requested by the Debtors, participate in hearings
before the Court and provide relevant testimony; and

     (11) render such other related financial advisory and
investment banking services as may be agreed upon.

Subject to and conditioned upon the submission of interim and
final applications in accordance with sections 330 and 331 of
the Bankruptcy Code, the Debtors and Rothschild have agreed that
fees for the services rendered in these cases will be:

      (A) a Monthly Cash Advisory Fee of $200,000 per month
commencing as of April 5, 2001, and whether or not a Transaction
is proposed or consummated, to be pro-rated based on the
commencement of services as of April 5, 2001 and payable by the
Debtors upon the execution of the Engagement Letter and
thereafter in advance on the first day of each month, or in
accordance with any applicable order of the Court;

      (B) A Completion Fee of $1,500,000, payable in cash upon
the earlier of (i) the confirmation and effectiveness of a
chapter 11 plan of reorganization or (ii) the substantial
consummation of another Transaction;

      (C) Additional Fees as may be mutually agreed upon for
additional services not contemplated by the Engagement Letter.

The parties also agreed on reimbursement of Rothschild's
reasonable out-of-pocket expenses incurred in connection with
the provision of services pursuant to the Engagement Letter.
Rothschild will maintain detailed records of any actual and
necessary costs and expenses incurred in connection with the
services rendered pursuant to their employment by the Debtors.

The Debtors also agreed to indemnify Rothschild and certain
related parties from or against any losses, claims or
proceedings related to or arising from Rothschild's engagement
by the Debtors.

The Debtors noted that the indemnification provisions are
consistent with and similar to provisions approved by the Court
on behalf of other professionals representing debtors in other
cases. In particular, indemnification is not available to
Rothschild if any loss, claim or proceeding results primarily
from Rothschild's gross negligence, willful misconduct or fraud.

In accordance with their previous representation before the
Court, the Debtors specified that they will not use the assets
of FINOVA (Canada) Capital Corporation or FINOVA Capital plc to
compensate Rothschild, unless such compensation is due and owing
specifically for work performed by Rothschild for FINOVA
(Canada) Capital Corporation or FINOVA Capital plc.

None of the professionals or employees of Rothschild has
discussed or will discuss the Debtors' cases with any
professional or employee of the Affiliated Entities, apart from
discussions among their respective legal personnel and outside
counsel. Thus, there has not been and will not be any flow of
information between Rothschild and the Affiliated Entities with
respect to any matter pertaining to the Debtors or these chapter
11 cases, the Debtors submit. The Debtors made it clear that
Rothschild can make no representation as to the
disinterestedness of the professionals or employees of the
Affiliated Entities in respect of the FINOVA chapter 11
proceedings.

The Debtors also made it clear that, by this Application, they
are not seeking to assume any executory contract, if any exists,
between Rothschild and the Debtors. Based upon the declaration
of Todd R. Snyder, Managing Director of Rothschild, Inc., the
Debtors believe that Rothschild does not hold or represent any
interest adverse to the Debtors' estates and is a "disinterested
person" as such term is defined in section 101(14) of the
Bankruptcy Code, and as required under section 327(a) of the
Bankruptcy Code.

In his declaration, Mr. Snyder revealed that:

      (a) Prior to the formation of the official committee of
equity security holders, Rothschild entered into discussions
with its predecessor unofficial committee of security holders
(the "Unofficial Equity Committee") in connection with the
possible retention of Rothschild as the Unofficial Equity
Committee's financial advisor. During the course of those
discussions, Rothschild had meetings with the Unofficial Equity
Committee's counsel of a general nature wherein no substantial
or material non-public information was disclosed to Rothschild.
Specifically, Rothschild attended a meeting wherein Goldman
Sachs presented a joint proposal by Goldman and GE Capital to
fund a plan of reorganization of the Debtors. For the meeting
with Goldman, Rothschild received from the Debtors certain
non-public information for the purpose of conducting due
diligence with respect to the GE/Goldman proposal. Such
information was of a nature that Rothschild has since received
as the Debtors' proposed financial advisor and investment
banker. In addition, Rothschild received the non-public terms
of the GE/Goldman proposal, which has since been withdrawn.

      (b) Rothschild has a current advisory relationship with
British Telecom, an unsecured creditor of the Debtors.
Rothschild does not, and will not represent or advise British
Telecom with respect to the Debtors' chapter 11 cases.

      (c) Certain of Rothschild's employees may currently own
stock of the Debtors. No Rothschild employee holds, nor do its
employees in the aggregate hold, a material stock ownership
position.

      (d) Rothchild and its employees may have business
associations with, may have rendered services to, and may
continue to render services to, official committees or informal
committees of which certain of the Debtors' creditors or
parties-in-interest are or were members, in each case in matters
wholly unrelated to these cases.

      (e) Rothschild has worked with other professionals who are
retained by either the Debtors, their creditors or other parties
in interest in matters unrelated to the Debtors.

Mr. Snyder recognizes that, given the size of the Debtors, and
the extent of their prepetition lenders and their numerous other
creditors, Rothschild believes that it is unlikely that any
financial advisor or investment banking firm with expertise
necessary for these cases exists that does not have
relationships with some of the Debtors' creditors in unrelated
matters.

Mr. Snyder submitted that to the best of my knowledge,
information and belief, Rothschild, nevertheless, does not have
or represent any interest materially adverse to the interests of
the Debtors, or of any class of creditors or equity security
holders of the Debtors.

The proposed engagement of Rothschild is not prohibited by
Bankruptcy Rule 5002, Mr. Snyder represented.

Mr. Snyder covenants that if the Court approves the proposed
employment of Rothschild by the Debtors, Rothschild will not
accept any engagement or perform any services for any entity or
person other than the Debtors in these cases. Rothschild will,
however, continue to provide professional services to entities
or persons that may be creditors of the Debtors or parties in
these chapter 11 cases; provided, however, that such services do
not relate to, or have any direct connection with these chapter
11 cases.

Mr. Snyder also assured that Rothschild will continue to monitor
its relationships with the creditors and other parties in
interest in the Debtors' chapter 11 case, and will promptly make
such disclosure accordingly. (Finova Bankruptcy News, Issue No.
8; Bankruptcy Creditors' Service, Inc., 609/392-0900)


GENESIS HEALTH: Capital Structure & Governance Of New Debtors
-------------------------------------------------------------
The following table summarizes the proposed capital structure
for Reorganized Genesis Health Ventures, Inc. & The Multicare
Companies, Inc., including the post-Effective Date financing
arrangements Genesis expects to execute to fund Administrative
Expense Claims and the working capital needs of the ongoing
business operations of the restructured companies.

The post-Effective Date financing arrangements are anticipated
to include a revolving credit facility in the amount of at least
$100,000,000. The Debtors' administrative expenses will be paid
through the incurrence of senior secured debt of approximately
$235,000,000. In the alternative, it may be desirable for
Reorganized Genesis to raise funds in the public debt markets.
The Debtors will determine the best form of such exit financing
as the projected Confirmation Date approaches.

Except as otherwise provided in the Plan and described herein,
unless the underlying property is sold or surrendered, the
Genesis Debtor or Multicare Debtor that is the current obligor
on a mortgage will continue as the mortgagee.

Instrument             Description           Comments
----------             -----------           --------
Revolver               up to $150.0 million  (exit financing)

Senior Secured Term
Loans or New Public
Debt                   $235.0 million        (exit financing)

Mortgages              $141.4 million        (reinstated or
                                                amended)

New Senior Notes       $247.6 million        (restructuring
                                                securities)

New Convertible
Preferred Stock        $42.6 million         (restructuring
                                                securities)

New Common Stock       41,000,000 shares     (restructuring
                                                securities)

New Warrants           To purchase up to     (restructuring
                         5.8% of the            securities)
                         New Common Stock

             Governance of the Reorganized Debtors

(a) Board of Directors of Reorganized Genesis

      The initial Board of Directors of Reorganized Genesis will
      consist of 7 members, whose names and qualifications will
      be disclosed no later than the hearing to confirm the Plan
      of Reorganization. Six members will be selected by the
      holders of the Genesis Senior Lender Claims and the
      Multicare Senior Lender Claims. The Chief Executive Officer
      of Reorganized Genesis will be a director and Chairman of
      the Board. Each member of the initial Board of Directors
      will serve on the Board of Directors in accordance with
      Reorganized Genesis's Amended Certificate of Incorporation
      and Bylaws, which may be amended from time to time.

(b) Senior Management of Reorganized Genesis

      As of the Effective Date, Reorganized Genesis will enter
      into long term employment agreements with its top four
      senior executives:

                Name                       Title
                ----                       -----
           Michael R. Walker         Chief Executive Officer
                                     and Chairman of the Board

           Richard R. Howard         Vice Chairman

           David C. Barr             Vice Chairman

           George V. Hager, Jr.      Executive Vice President
                                     and Chief Financial Officer

      In general, the contracts provide for three year employment
      terms which are automatically renewed unless either
      Reorganized Genesis or the employee provide advance notice.
      Copies of the new employment agreements and the New
      Management Incentive Plan will be part of the Plan
      Supplement.

      Reorganized Genesis will also adopt a new long term
      Management Incentive Plan.

      The Plan of Reorganization will be deemed a solicitation of
      the holders of New Common Stock for approval of the New
      Management Incentive Plan.

(Genesis/Multicare Bankruptcy News, Issue No. 10; Bankruptcy
Creditors' Service, Inc., 609/392-0900)


IMPERIAL SUGAR: Summary Of Second Amended Plan Of Reorganization
----------------------------------------------------------------
The Plan is proposed by Imperial Sugar Company to implement the
terms of agreements in principle reached prior to the
commencement of these Chapter 11 cases with the Bank Group, the
Ad Hoc Bondholder Committee, and various other key creditor
groups. The purpose of the Plan is to alleviate the Debtors'
capital and liquidity problems by extending the maturity and
modifying the covenants and certain other terms of the majority
of Imperial's debt to the Bank Group under the Senior Credit
Agreement, and by converting Imperial Senior Subordinated Notes
and most of the Debtors' other unsecured debt, including certain
Inactive Non-qualified Benefits Claims of former employees (but
excluding Critical Vendor Claims, Convenience Claims, and
Inactive Non-qualified Benefits Convenience Claims) into
ownership of approximately 79.4% of the new common stock of
Reorganized Imperial on a fully-diluted basis after exercise of
management options under the Reorganized Imperial Stock Option
Plan and, if issued, Class 9 warrants.

                       Summary of Plan

Under the Plan, the Disbursing Date will be the date, with
respect to an allowed claim, which is as soon as reasonably
practicable after the later of: (i) the Effective Date, (ii) the
date on which the claim is due and owing according to its terms,
or (iii) the first business day of the next calendar quarter
after the date on which the claim becomes allowed, unless the
claim becomes allowed within 15 business days before the first
business day of the next succeeding calendar quarter, in which
case the Distribution Date will be the first business day of
the next succeeding quarter; provided, however, that the
Reorganized Debtors will have the authority, in their sole
discretion, to make earlier distribution if deemed appropriate
by them.

The "Effective Date" of the Plan means, and will occur on, the
first business day immediately following the first day upon
which all conditions to occurrence of the Effective Date have
been satisfied or waived in accordance with the Plan provisions.

Under the Plan, on the Effective Date of the Plan:

      a) Cancellation of Existing Common Stock. All existing
common stock will be cancelled and deemed null and void for all
purposes as of the Effective Date without need for further
action by the Debtors, the Reorganized Debtors, or the
Bankruptcy Court.

      b) Reorganization of Imperial and Changes to Capital
Structure. Imperial will reorganize and continue its business
operations as Reorganized Imperial. While the structure and
corporate organization of Imperial's debtor and non-debtor
subsidiaries will remain unchanged, Imperial's capital and debt
structure w ill be improved, the Debtor claims, by:

         (i) conversion of the Debtors' funded unsecured debt and
             certain other unsecured claims to equity in
             Reorganized Imperial; and

        (ii) restructuring of substantially all of the Secured
             Claims of the Bank Group.

      c) Management of Reorganized Imperial. Reorganized Imperial
will be managed by the Board of Directors of Reorganized
Imperial in accordance with an Amended and Restated Certificate
of Incorporation, and Amended and Restated Bylaws of Reorganized
Imperial;

      d) Substantive Consolidation. The Debtors' estates will be
substantively consolidated for purposes of the Plan, and actions
with respect to distributions to holders of Claims and Interests
in impaired classes. The Reorganized Debtors, however, shall
continue to maintain their corporate existences for all purposes
other than for purposes of distributions under the Plan;

      e) Revesting of Property. All property of the Debtors'
estates shall revest in and become property of the Reorganized
Debtors on the Effective Date, subject to the liens of the Bank
Group under the Senior Credit Agreement, DIP Facility, and
Amended Senior Credit Agreement.

      f) Authority to Pursue Litigation. All claims and causes of
action belonging to any of the Debtors, including retained
avoidance actions, shall vest in and become property of
Reorganized Imperial on the Effective Date. The determination of
whether to prosecute these claims and, if prosecuted, whether to
settle or resolve such claims, shall be committed to the sole
discretion of Reorganized Imperial and shall not be subject to
the need for court approval. Subject to the liens of the Bank
Group, Reorganized Imperial shall have the sole and exclusive
right to determine the use or application of the proceeds, if
any, from such litigation.

      g) Mechanisms for Distribution. The Disbursing Agent will
make all distributions required under the Plan. Distributions
shall be made on the Distribution Date (unless otherwise
provided under the Plan, ordered by the Bankruptcy Court, or
agreed to between the reorganized Debtor and the holder of a
Claim) with respect to all Claims. Distributions to be made on
the Distribution Date shall be deemed actually made on the
Distribution Date if made either (a) on the Distribution Date;
or (b) as soon as practicable thereafter;

The Disbursing Agent is Reorganized Imperial, although the
Indenture Trustee, will serve as disbursing agent for holders of
bondholder claims.

      h) Further Authorizations. The Debtors and/or the
Reorganized Debtors, if and to the extent necessary, may seek
such orders, judgments, injunctions and rulings that any of them
deem necessary to further carry out the intentions and purposes
of, and give full effect to, the provisions of the Plan;

      i) Unclaimed Distributions. Any cash, assets, and other
property to be distributed under the Plan that remain unclaimed
(including by a person's failure to negotiate a check issued to
such person) or otherwise not deliverable to the entity entitled
to the same before the later of (a) o N.E.2d year after
distribution, or (b) 120 calendar days after an order allowing
such person's claim becomes a final order, shall become vested
in, and shall be transferred and delivered to, the Reorganized
Debtors for use in their discretion on the 30th day after the
Reorganized Debtors file a notice with the Bankruptcy Court
setting forth such undeliverable distributions and the person
according to the Debtors' records entitled to receive such
distributions. In such an event, the person's claim shall o
longer be deemed to be allowed, and the person shall be deemed
to have waived its rights to payments or distributions under the
Plan, and shall have no further claim in respect to such
distribution, and shall not participate in any further
distributions under the Plan with respect to such claim; and

      j) Binding Effect of Plan. Upon the Bankruptcy Court's
entry of the confirmation order, the Plan will be binding upon
the Debtors, all holders of Claims and interests and all other
parties in interest regardless of whether they have accepted the
Plan.

      Classes of Claims and Interests & Treatment Under Plan

Administrative Claims.

These claims, which the Debtors estimate to be 10.6 million,
excluding postpetition ordinary-course liabilities and
prepetition liabilities authorized to be paid in the ordinary
course by court order, will receive the allowed amount of its
administrative claim, in cash, in full satisfaction, settlement,
release, extinguishment and discharge of the claim, on the
Distribution Date; provided, however, that allowed
administrative claims representing (a) postpetition liabilities
incurred in the ordinary course of business by any of the
Debtors, (b) postpetition contractual liabilities arising under
loans or advances to any of the Debtors, and prepetition
liabilities authorized by the Bankruptcy Court to be paid in the
o ordinary course of the Debtors' businesses, but which have not
yet become due and payable in accord with their terms, will be
paid by the Reorganized Debtors in accord with the terms and
conditions of the agreements establishing such liabilities. This
class includes all postpetition beet grower obligations.

Priority tax claims.

Under the Bankruptcy Code certain unsecured claims are entitled
to priority of payment over general, unsecured claims. These
include claims of governmental units for certain types of (a)
taxes on gross receipts or gross income; (b) property taxes; (c)
employment taxes on wages, salaries, and commissions; (d) excise
taxes; and customs duties.

The Debtors estimate these claims to total $7.6 million. Each
holder of an allowed priority tax claim (except to the extent
the holder agrees to different treatment) will receive the
allowed amount of its priority tax claim through deferred cash
payments with simple interest at the rate in effect under
Section 6621(b)(3) of the Internal Revenue Code, commencing on
the 10th business day after the Effective Date or, if later, the
date on which the claim is allowed, with final payment to be
made on the sixth anniversary of the assessment of the claim
with simple interest; provided, however, that these priority tax
claims may be paid, in whole or in part, without penalty at the
election of the Reorganized Debtors.

Class 1: Priority Non-tax Claims.

Holders of Unsecured Claims Entitled to Priority (estimated to
be $9.9 million) Holders of claims entitled to priority, other
than priority tax claims, are treated under Class 1 of the Plan
and will be paid the allowed amount of their priority claims in
full in cash on the Distribution Date, or through such other and
lesser amount as the holder of the claim and the Debtor and/or
Reorganized Debtors may agree.

This class is unimpaired and therefore the holders of claims in
this class are conclusively presumed to have accepted the Plan.

Class 2A: Claims of Tranche A Term Lenders.

The Debtors estimate that claims in this class total $83.4
million. The Plan provides that the allowed secured claims of
the Tranche A Term Lenders will be satisfied through payment
under the terms of an Amended Senior Credit Agreement and
related loan documents.

This class is impaired and the holders of claims in this class
are entitled to vote to accept or reject the Plan.

Class 2B: Claims of Tranche B Term Lenders.

The Debtor estimates that claims in this class total $66.2
million. The Plan provides that the allowed secured claims of
the Tranche A Term Lenders will be satisfied through payment
under the terms of an Amended Senior Credit Agreement and
related loan documents.

This class is impaired and the holders of claims in this class
are entitled to vote to accept or reject the Plan.

Class 2C: Claims of Participating Lenders.

The Debtor estimates that claims in this class total $152.6
million. The Plan states that the allowed secured claims of
lenders under the Revolving Credit Facility who elect to be
participating lenders under an Amended Senior Credit Agreement
will be satisfied under the terms of the Amended Senior Credit
Agreement and related loan documents.

This class is impaired and the holders of claims in this class
are entitled to vote to accept or reject the Plan.

Class 2D: Claims of Non-participating Lenders.

The Debtors estimate that there will be no claims in this class,
believing that all of the lenders under the Revolving Credit
Facility will elect to participate under the Amended Senior
Credit Agreement. However, in the event that there are any
claims in this class, the allowed secured claims of lenders who
elect to be non-participating lenders under the Amended Senior
Credit Agreement will be satisfied through a ten-year note with
a twenty-year amortization schedule, to be issued by Reorganized
Imperial on the Effective Date, payable in annual installments
and bearing interest at the rate of 12% per annum. Repayment of
such a note will be secured by existing liens and security
interests, the liens and interests to be on a pari passu basis
with the liens and interest of participating lenders in the same
collateral; provided, however, that so long as no default has
occurred, no prepayments on such a note will be made from sales
of collateral.

This class is impaired and the holders of claims in this class
are entitled to vote to accept or reject the Plan.

Class 3: Other Secured Claims.

The Debtor estimates that the claims in this class will total
$145,000. Each holder of an allowed secured claim in this class
against a Debtor shall retain, unaltered, the legal, equitable
and contractual rights (including, but not limited to, any liens
that secure the allowed secured claim) to which the allowed
secured claim entitles the holder.

This class is unimpaired, and therefore the holders are
conclusively presumed to have accepted the Plan.

Class 4: IDB Claims.

The Debtor estimates that claims in this class total $25.4
million. Each holder of an allowed IDB claim against a Debtor
will retain, unaltered, the legal, equitable and contractual
rights to which the allowed IDB claim entitles the holder.

This class is unimpaired, and therefore the holders are
conclusively presumed to have accepted the Plan.

Class 5A: Unsecured Claims.

The Debtors' Plan excludes from this Class Necessary Vendor
Claims, Convenience Claims, Inactive Non-Qualified Benefits
Claims, and Intercompany Claims, and estimates that the claims
in this Class total $281.7 million. Except to the extent that a
holder of an allowed Class 5A unsecured claims has agreed to
receive other lesser treatment, each holder will receive a pro
rata distribution of Class 5A/5B new common stock in full
satisfaction of the Class 5A unsecured claim.

Class 5A/5B new common stock means 9,800,000 shares of new
common stock (equivalent to 79.4% of the shares of Reorganized
Imperial on a fully- diluted basis after exercise of Class 9
warrants and management options) which are to be issued by
Reorganized Imperial and distributed on a pro rata basis to the
holders of allowed unsecured claims treated under Class 5A of
the plan, and the holders of Inactive Non-qualified Benefits
Claims treated under Class 5B of the Plan, other than those
holders of Claims in Class 5B, who make an election on their
ballots to receive deferred cash payments in lieu of new common
stock.

This class is impaired and the holders of claims in this class
are entitled to vote to accept or reject the Plan.

Class 5B: Inactive Non-qualified Benefits Claims.

The Debtors' Plan defines an allowed Inactive Non-qualified
Benefits Claim as meaning the actuarial present value of the
projected benefit obligations due under the agreements giving
rise to such a claim, calculated using a 6% discount rate, such
claim to include such additional amounts as may be allowed by
order of the Bankruptcy Court for prepetition fees and costs
permitted under the applicable agreement, if any. The Debtors'
Plan removes from this class Inactive Non-qualified Benefits
Convenience Claims, and estimates that the total remaining
claims equal $36.7 million. Except to the extent treated under
Class 7B of the Plan, Inactive non-qualified Benefits Claims
will be satisfied on the distribution date through a pro rata
distribution from the pool of Class 5A/5B new common stock
jointly available to creditors treated under Class 5A and 5B of
the Plan.

In lieu of such distribution, holders of claims treated under
Class 5B may elect to receive:

      (a) An initial cash distribution equal to the lesser of 10%
of their deemed allowed Inactive Non-Qualified Benefits Claims,
or the sum of $3,000,000 pro rated among the holders of claims
in Class 5B who elect treatment under this alternative, and

      (b) An Inactive SERP/DC Note entitling them to receive
equal quarterly payments, without interest, equal in the
aggregate, when combined with the initial distribution, to 60%
of their deemed allowed inactive Non-qualified Benefits Claims
(subject to certain rights in the event of default or conversion
of the Debtors' reorganization cases to proceedings under
Chapter 7 of the Bankruptcy Code.

In the alternative, holders of Inactive Non-Qualified Benefits
Claims may elect to reduce the aggregate of distributions under
applicable supplemental executive retirement and deferred
compensation plans to $3,000 a month or less and be treated
under Class 7B of the Plan.

A "deferred compensation plan" is the voluntary retirement
benefit arrangements with selected employees and/or directors
and former employees and/or directors of the Debtors pursuant to
which such employees and/or directors deferred part of their
compensation for services rendered until the attainment of
retirement age or actual retirement or separation from the
company.

This class is impaired and the holders of claims in this class
are entitled to vote to accept or reject the Plan.

A "Deemed Allowed Ad Hoc SERP/DC Committee Administrative Claim"
means the administrative claim of the Committee for
reimbursement of reasonable fees and expenses (including
reasonable attorneys' fees and expenses) incurred in connection
with the substantial contribution provided by the Committee in
the negotiation of the treatment of Inactive Non-Qualified
Benefits Claims under Class 5B of the Plan, which claim will be
deemed allowed on confirmation, in the amounts of $195,985.47
(representing the fees and expenses of $169,243.30 incurred by
Chamberlain, Hrdlicka, White, Williams & Martin through April 15
2001, and fees and expenses of $26,742.17 incurred by The Bayard
Firm through February 28, 2001, and (ii) in such further amounts
as are included in the confirmation order or otherwise allowed
for services rendered prior to the Effective Date.

Class 6A: Necessary Vendor Claims.

The Debtors estimate that claims in this class total $7.0
million. Except to the extent that a holder of an allowed Class
6A Necessary Vendor Claim has agreed to receive other lesser
treatment, allowed Class 6A Necessary Vendor Claims will be paid
in full on the later of (a) the date agreed by the holder of
such claim under its contractual arrangements with the
contracting Debtors, or (b) the Distribution Date.

The Debtors deem that this class is unimpaired by the Plan, and
therefore the holders of claims in this class are conclusively
presumed to have accepted the Plan.

Class 6B: Retiree Insurance Benefit Claims.

The Debtors estimate the value of claims in this Class to be
$32.4 million. Each allowed Retiree Insurance Benefit Claim will
be paid in accordance with the Bankruptcy Code which provides
that such claims may not be impaired or affected by the Plan.
All uncured and continuing defaults by the Debtors in he payment
of such claims, either before or after commencement of the
reorganization cases, will be cured on the Distribution Date.

The Debtors deem that this class is unimpaired by the Plan, and
therefore the holders of claims in this class are conclusively
presumed to have accepted the Plan.

Class 7A: Convenience Claims.

The Debtor defines "convenience claims" as meaning any
convenience allowed unsecured claim, excluding bondholder claims
and Inactive Non- qualified Benefit Claims, otherwise entitled
to treatment under Class 5A of the Plan, which is $5,000 or
less, when aggregated with the other unsecured claims of the
holder, or in the alternative, is reduced by election of the
holder on the holder's ballot, together with all other unsecured
claims of the holder, to an aggregate unsecured claim of $5,000.

The Debtors estimate that claims in this Class total $2.5
million. Allowed Convenience Claims will be paid in full in cash
on the Distribution Date.

The Debtors deem that this class is unimpaired by the Plan, and
therefore the holders of claims in this class are conclusively
presumed to have accepted the Plan.

Class 7B: inactive Non-Qualified Benefits Convenience Claims.

The Debtors estimate the value of these claims as $6.8 million.
Holders of these claims as allowed will retain the legal,
equitable and contractual rights to which the claim entitles the
holder, and be paid in accordance with those terms; provided,
however, that no such claim shall be accelerated,
notwithstanding any contractual provision of applicable non-
bankruptcy law which provides to the contrary, upon the
occurrence of a default. All defaults will be cured on the
Effective Date.

The Debtors deem that this class is unimpaired by the Plan, and
therefore the holders of claims in this class are conclusively
presumed to have accepted the Plan.

Class 8: Inter-company claims.

The Debtors estimate that claims in this class total $479.8
million. Inter-company claims will be treated in accord with the
Debtors' current business practices with respect to such claims.

The Debtors deem that this class is unimpaired by the Plan, and
therefore the holders of claims in this class are conclusively
presumed to have accepted the Plan.

Class 9: Interests in Imperial.

If (i) holders of interest in Imperial, and (ii) holders of
claims treated under Class 5A and Class 5B of the Plan vote, as
classes, to accept the Plan, holders of interests in Imperial
will receive distributions on the Effective Date from the
Disbursing Agent a pro rata share of Class 9 new common stock
and Class 9 warrants. This distribution is subject to approval
of the Plan by creditors classified in Class 5A and Class 5B of
the Plan, and may be eliminated if such creditors reject the
Plan.

The Debtors deem this class impaired and therefore the holders
of such interests are entitled to vote to accept or reject the
Plan.

Class 9 new common stock means 200,000 shares of new common
stock (equivalent to 1.6% of the shares of Reorganized Imperial
on a fully- diluted basis after exercise of Class 9 warrants and
management options) which, subject to the terms of the Plan and
requirements of the Bankruptcy Code, are to be issued by
Reorganized Imperial and distributed on a pro rata basis to the
holders of Class 9 interests under the Plan.

Class 9 warrants mean those Reorganized Imperial warrants which
are to be issued to holders of Class 9 interests under the Plan
representing the right to purchase an aggregate of 1,111,111
shares of new common stock (equivalent to 9% of the shares of
Reorganized Imperial on a fully-diluted basis after exercise of
management options) which, subject to the terms of the Plan and
requirements of the Bankruptcy Code, are to be issued to holders
of Class 9 interests under the Plan.

This class is impaired and the holders of claims in this class
are entitled to vote to accept or reject the Plan.

                 Exoneration of Parties

The Plan provides that, upon confirmation, the following parties
will be exonerated from all liability, other than as expressly
provided in the Plan:

              Debtors
              Reorganized Debtors
              Creditors Committee
              Indenture Trustee
              Ad Hoc Bondholder Committee
              Harris Trust & Savings Bank
              The Bank Group (excluding lenders who
               are non-participating lenders)
              Harris Trust & Savings Bank or its successor
               as administrative agent and/or collateral
               agent under the Senior Credit Agreement
              The DIP Lenders
              The Disbursing Agent
              The Ad Hoc SERP/DC Committee
              All of the stockholders, directors, officers
               agents, employees, members accountants,
               attorneys financial advisors, and
               representatives of any one or all of the
               Foregoing.

(Imperial Sugar Bankruptcy News, Issue No. 6; Bankruptcy
Creditors' Service, Inc., 609/392-0900)


INTEGRATED HEALTH: Rejecting Nine More Rotech Leases
----------------------------------------------------
Integrated Health Services, Inc. seeks to reject nine more
Rotech Medical Corporation leases of nonresidential real
property, pursuant to Section 365 of the Bankruptcy Code because
these leases: (a) are of no value to the Debtors, or continue to
be a burden upon the Debtors' estates; and (b) are unnecessary
for the Debtors' continued operations.

These leases are as follows:

Company Name                Address                   Rent
------------                -------                   ----
Resp-A-Care, Inc.           801 North Dixie Avenue    $1,400
                             Suite B Elizabethtown
                             KY 42701

Infusion Services, Inc.     5881 West Main Street     $3,950
                             Dothan, AL 36305

Home Medical Systems, Inc.  117 Ambulance Drive       $2,195
dba In Home Health Care, Inc.  Carrollton, GA 30117

National Wound Care         106 S.Country Fair Dr.   $13,281
                             Champaign, IL 61821

National Wound Care         8610 Madison Avenue         $645
                             Cleveland, OH 44102

PSI Healthcare, Inc.        313 E. Superior Street    $5,100
D/b/a Arrowhealth           Duluth, MN 55802

Community Home Oxygen, Inc. 1300 Aspen Street         $6,760
                             Helena, MT 59601

Home Medical Systems, Inc.  2785 Charlotte Hwy        $1,439
D/b/a American Health       Suite 10
Services                    Mooresville, NC          $28,115

Northwest Home Medical,     North 101 Argonne Road    $5,079
Inc.                        Suite C Spokane
                             WA 99212

The Debtors further proposed that the Court establish a
Rejection Claims Deadline of 30 days from the date of notice of
entry of the order granting the motion. The Debtors proposed
that a holder of a rejection claim who fails to timely file a
proof of such claim on or prior to the expiration of the
Rejection Claims Deadline be: (a) forever barred from asserting
such claim against any of the Debtors or their estates and
sharing in any distribution out of the Debtors' estates or
assets under any plan of reorganization confirmed in the IHS
Chapter 11 cases or otherwise, and (b) bound by the terms of any
such plan and/or Order of the Court authorizing distributions
from the Debtors' estates. (Integrated Health Bankruptcy News,
Issue No. 17; Bankruptcy Creditors' Service, Inc., 609/392-0900)


KITTY HAWK: Hearing On Plan Confirmation is on August 1, 2001
-------------------------------------------------------------
On May 30, 2001, Kitty Hawk Inc. and its subsidiaries filed the
Debtors' Amended Joint Plan of Reorganization dated May 30,
2001, and the Disclosure Statement Under 11 U.S.C. Sec. 1125 in
Support of the Debtors' Joint Plan of Reorganization, also dated
May 30, 2001, in the United States Bankruptcy Court for the
Northern District of Texas, Fort Worth Division.

The hearing on the approval of the adequacy of the Disclosure
Statement was held on May 23, 2001. The Order Approving Final
Disclosure Statement was signed on May 31, 2001 and entered on
May 31, 2001.

The hearing on the confirmation of the Plan will commence on
August 1, 2001 at 1:15 p.m., Dallas, Texas time, before the
Honorable Barbara J. Houser at 1100 Commerce Street, 14th Floor,
Dallas, Texas.


LTV CORP: Seeks Bankruptcy Court Help to Modify Labor Agreements
----------------------------------------------------------------
The LTV Corporation (OTC Bulletin Board: LTVCQ) asked the U.S.
Bankruptcy Court to help clear the way for modified labor
agreements that are necessary to restructure its integrated
steel business and save the jobs and benefits of 7,700 employees
represented by the United Steelworkers of America. Also at risk
are Company-paid health care benefits for 100,000 people,
including active employees and their families, retirees and
eligible family members and surviving spouses.

The Company On Monday filed a motion in the U.S. Bankruptcy
Court in Youngstown, Ohio, for authorization to reject the
current collective bargaining agreements between the Union and
LTV Steel, thereby permitting the Company to implement a
proposal that has been the subject of negotiations. The motion
also requests authorization to modify the amount LTV Steel pays
for hourly retiree health care benefits. LTV Steel currently
provides benefits to about 56,000 hourly retirees, spouses and
surviving spouses. Annual cost of these benefits is
approximately $137 million. The motion does not seek to cancel
hourly retiree benefits, but to reduce the Company's
contribution to affordable levels.

LTV Steel said that it remains willing to negotiate an
acceptable agreement with the Union while the Court considers
the Company's motion. Achieving an acceptable agreement with the
Union, or a favorable ruling on the Company's motion, is
important to the Company's ability to secure a $250 million
federally guaranteed emergency steel loan, which is a critical
part of LTV's restructuring and reorganization.

"It is our duty to our employees, families and communities to do
everything we can to save LTV Steel and the thousands of high-
wage jobs and benefits it provides," said John D. Turner,
executive vice president and chief operating officer. "Without
restructuring and appropriate modification of the labor
agreements, LTV Steel will continue to lose money and will be
forced to permanently close its integrated steel operations."

"Our Company is no longer financially capable of providing the
very generous employee and retiree benefits that were once
synonymous with the integrated steel industry. Our competition
is no longer exclusively other integrated steelmakers with
similar USWA labor agreements; over half of the steel made
in the U.S. is produced by non-union minimills and the market is
open to lower-priced, often illegally dumped foreign steel," Mr.
Turner said. Mr. Turner stated that the Company is implementing
a restructuring plan that will make LTV Steel a viable
competitor against low-cost, non-union domestic minimills and
foreign producers. The plan will permanently eliminate $800
million a year of costs by making permanent changes in the way
LTV operates its steel business.

"Only about one-third of the needed savings will come from
modifying the existing labor agreements and hourly healthcare
benefits," said Mr. Turner. "The majority of the savings will
result from closing inefficient operations, selling non-core
businesses, dramatically reducing spending and administrative
costs and eliminating approximately 800 salaried positions
(30%), including cutting our headquarters staff in half."

The Court will determine if the Company's proposal is necessary
for the Company's bankruptcy reorganization, and treats all
parties fairly. The Court also will determine if the Union has
refused to accept the Company's proposal without good cause, and
whether rejection of the collective bargaining agreements is
justified based upon all of the relevant circumstances.

"We sincerely hope that the Court's review will lead to an
agreement that will allow LTV Steel to survive," Mr. Turner
said.

The Bankruptcy Court would normally be expected to schedule a
hearing on the labor agreements within 14 days and to rule on
the Company's motion within 30 days after the start of the
hearing. The Court would normally rule on the modification of
hourly retiree benefits within 90 days after the start of the
hearing.

LTV began discussing the problems facing LTV Steel and its
employees with the international leaders of the United
Steelworkers of America last December, when the Company faced a
financial crisis and filed chapter 11 bankruptcy. The Company
first met with the Union to discuss the need to restructure LTV
Steel in February 2001. The Company then reviewed with the Union
the restructuring plan and the related modifications to the
labor agreements and retiree benefits on April 11. Formal
negotiations began on April 24. LTV Steel modified its proposal
on May 10, and, at the request of the Union, offered an
alternative proposal on June 4. The Union rejected these
proposals. LTV has provided the Union's representatives and
consultants with full access to all financial information
concerning the Company and its restructuring plan. LTV also has
agreed to pay applicable fees to the Union's consultants and
advisors for their services to the USWA. Nevertheless, the Union
has not accepted changes in the labor agreements or retiree
benefits that are necessary to achieve the immediate and longer-
term cash savings needed by LTV Steel to survive.

The LTV Corporation is a manufacturing company with interests in
steel and metal fabrication. LTV's Integrated Steel segment is a
leading producer of high-quality, value-added flat rolled steel,
and a major supplier to the transportation, appliance,
electrical equipment and service center industries. LTV's Metal
Fabrication segment consists of LTV Copperweld, the largest
producer of tubular and bimetallic products in North America and
VP Buildings, a leading producer of pre-engineered metal
buildings for low-rise commercial applications.


LTV CORP: USWA Says Union Plan Would Save Bankrupt Steelmaker
-------------------------------------------------------------
The United Steelworkers of America (USWA) said that by taking
court action to terminate its contract with the Union and its
obligations on retiree health care benefits, LTV Corp. (OTC
Bulletin Board: LTVCQ) has turned its back on a USWA proposal
that would have provided the near-term cash flow and long-term
financing necessary for restructuring the bankrupt company.

"We were engaged in very constructive negotiations about an
extremely innovative plan, with real commitments by our members
that would put LTV back on its feet," said USWA President Leo
Gerard, "when the company destroyed the bargaining process by
abandoning the negotiations and going to court."

Nonetheless, the Union remains confident that working with the
affected stakeholders -- those that have a stake in the survival
of the company as an integrated steelmaker -- it can negotiate a
successful restructuring of LTV.

The Union said that, by its actions, LTV is summarily rejecting
an offer of a short-term loan derived from hourly pay, as well
as a loan from the union-negotiated Voluntary Employee Benefit
Association (VEBA) fund -- financing that would have helped
creditors keep the bankrupt steelmaker operating, including
avoiding the permanent shutdown of the Cleveland West facility.

Mr. Gerard said LTV's decision to abandon negotiations was
especially shocking, since it came on the heels of the Bush
Administration's decision last week to seek trade relief for the
American steel industry. "It defies reason to abandon a
cooperative effort at exactly the time when we have secured the
Administration's cooperation in the getting the kind of
government action it's going to take to save LTV," Gerard said.

In addition to seeking government action to achieve the long-
term survival of the company, the Steelworkers made proposals
for achieving greater manning efficiency and health care cost
containment, as well as recommending ways to cut costs through
reductions in contracting out and corporate mismanagement.

The Steelworkers proposal called on LTV executives to secure the
workers' offer of compensation reductions with millions in
retention bonuses that the executives recently awarded
themselves.

Mr. Gerard added that experts in corporate finance engaged by
the Steelworkers determined that the company's demands are ill-
conceived, since they exclude the financing necessary for
retaining steel making capacity, yet include a proposal to
import 70,000 tons of foreign slabs per month for use at its
Cleveland East operations, slabs now being produced at Cleveland
West.

"Foreign dumping is exactly what's driving down the price of
steel in this country," Gerard said. "Yet LTV wants to dump
almost one million tons more of cut-rate foreign steel in this
market every year, instead of revitalizing Cleveland West. All
that will do is drive down the pricing that's already killing
the industry."

Among the more devastating aspects of LTV's demands, according
to Gerard, are:

      * Shutting down Cleveland West and importing nearly one
        million tons of foreign steel slabs annually

      * Demanding the power to terminate the Steelworkers'
        pension plan

      * Slashing workers' pay $2 per hour and drastically cutting
        retirees' health care coverage which would force many
        retirees to pay more for health care than they receive in
        pensions

      * Devastating the active workers' health care plan

"Our plan would do a lot to save this company, its workers and
retirees," Gerard said. "We thought that's what the negotiations
were all about. Apparently LTV's senior executives have other
ideas."


LTV: Cleveland Reps Oppose Action to Dissolve Union Contract
------------------------------------------------------------
U.S. Representatives Stephanie Tubbs Jones and Sherrod Brown
sent a letter to William Bricker, Chairman and CEO of the LTV
Corporation in response to its court motion to break the
company's contract with United Steelworkers of America Local
185.

The action by the LTV Corporation to attempt to set aside its
negotiated contract with its union in order to gain leverage in
bankruptcy negotiations may help LTV but it does not help the
workers who in good faith trusted their employer to treat them
with the respect and dignity their years of service warrant.

"From the beginning, members of Congress have been clear that we
would assist the steel industry as long as it agreed to honor
obligations to employee retirement and pension plans," they
wrote. "We want to help LTV and other steel companies become
financially viable, but this recovery process must not include
dissolving union contracts."

"The Bush Administration responded just six days ago to pleas
from steelworkers, executives, and members of Congress by
announcing its intent to petition the International Trade
Commission (ITC) to conduct an investigation into illegal steel
dumping. This move marked a symbolic victory for all involved
parties who have worked together for more than three years to
secure this investigation. On the heels of this success, your
request that a federal court nullify this agreement undermines
the trust we established during these tense times."

"I am deeply offended that LTV would turn around after the
Representatives of the Cleveland Area worked to help LTV keep
its doors open, and try to break its contract with its workers.
I understand bankruptcy negotiations can be difficult but we
cannot allow difficulty to endanger the welfare of workers and
protections negotiated under a contract," said Congresswoman
Tubbs Jones.

"LTV's request for a federal court to nullify an agreement with
its workers flies in the face of the cooperative and
constructive spirit that has marked this effort. We all want the
same goal -- a financially viable steel industry. The steel
industry will never recover if workers' rights, such as health
care and retirement benefits, are compromised," said Congressman
Brown.


MARKETING SPECIALISTS: Acosta Hires 1,700 Former Employees
----------------------------------------------------------
Acosta Sales and Marketing, the largest sales and marketing
agency serving the consumer packaged goods industry, announced
that it has hired 1,700 ex-Marketing Specialist employees,
effective June 1st. All employees of Marketing Specialists
(OTCBB:MKSP) had been dismissed by Marketing Specialists just
one week earlier, subsequent to the company's recent voluntary
Chapter 11 filing.

According to Gary Chartrand, Chairman/CEO of Acosta, "While the
Chapter 11 filing was an unfortunate event, the resulting
incremental business afforded Acosta is an excellent fit with
our strategic growth plans. We also felt an obligation to our
clients and the industry to act swiftly, to prevent the
possibility of any further disruption of services to
manufacturers, retailers and consumers."

The hiring announcement came after Marketing Specialists
withdrew its motion for the bankruptcy court to approve a
proposed consolidation agreement with Acosta. The withdrawal has
not deterred former clients of Marketing Specialists, many of
which were already represented by Acosta, from continuing to
transition their business to Acosta.

In addition to the 1,700 new employees already hired, the
company is holding job fairs at all Acosta office locations to
ensure that its offices are fully staffed and prepared to handle
the influx of new business opportunities provided by the recent
Marketing Specialists bankruptcy filing.

              About Acosta Sales & Marketing Co.

Acosta provides outsourced sales and marketing services to
manufacturers of food and other consumer packaged goods around
the world. Acosta has more than 9,200 Associates at 66 offices
located throughout the United States and Internationally. Acosta
is based in Jacksonville, Florida and is privately held. More
information is available on the Company's Web site at
http://www.acosta.com


MIDLAND FOOD: Opposes Order Terminating Exclusivity
---------------------------------------------------
Midland Food Services, LLC objects to the motion of Bay View
Mortgage Acceptance Company for entry of order terminating
exclusivity.  The debtor states that the termination motion is
premised upon three flawed assumptions:

    (a) that the Trust entity to which the debtor is indebted,
        will vote to reject the plan;

    (b) it incorrectly assumes that new value is required under
        any plan of reorganization, irrespective of the outcome
        of the plan voting process; and

    (c) it assumes that termination of exclusivity is the only
        option available to the court if the debtor amends its
        plan to provide for the contribution of new value from
        the debtor's members.

The Debtor says that the trust has not advised the debtor that
it intends to vote against the plan. Further, the debtor states
that the holders of equity interests are required to contribute
new value only if the plan does not receive acceptances from all
impaired classes. Although without a consensual plan, the debtor
admits that the plan must make provision for new value. The
debtor submits that cause does not exist for a grant of the
Termination Motion. The debtor has thus far obtained only one
extension of its exclusivity periods for 90 additional days. The
debtor has made substantial progress toward gaining acceptance
of a plan, and this justifies the denial of the Termination
Motion.

Co-counsel for the debtors are Leon R. Barson of Adelman Lavine
Gold and Levin and Charlene D. Davis of The Bayard Firm,
Wilmington, DE.


MIDLAND FOOD: Reaches Accord on Pizza Hut Franchise Agreements
--------------------------------------------------------------
Midland Food Services, LLC and Pizza Hut, Inc. have reached
consensus on the terms of assumption and the manner of cure of
one of the debtor's most important assets - its franchise
agreements.

Assuming approval of the Assumption Motion, the debtor will pay
approximately $2.043 million to Pizza Hut in partial
satisfaction of the Cure Amount. Commencing on the effective
date of the plan and continuing for the succeeding 14 months,
the debtor will make payments to Pizza Hut each in the amount of
$95,738. The debtor will also pay $1.36 million to Pizza Hut on
or about the second month following the plan's effective date.

The debtor's decision to assume its Franchise Agreements is
essential to the ongoing reorganization effort. Also, the terms
of cure of the pre-petition defaults are more favorable than the
debtor could obtain if Pizza Hut were to object to the
assumption of the Franchise Agreements.

The debtor also pointed out that its servicer argued that the
debtor owing Pizza Hut's affiliate, Tricon is not properly
payable as part of the debtor's cure of defaults under the
Franchise Agreements. The debtor stated that the servicer
confused issues concerning enforceability of what it
characterizes as a cross-default provision in the Franchise
Agreements with the propriety of Pizza Hut requiring payment of,
as part of the cure package, and the debtor agreeing to payment
of, the Tricon indebtedness. Regardless of whether a so-called
cross-default provision in an executory contract may be viewed
as a restriction on a debtor's right to assume an executory
contract, the debtor has agreed with Pizza Hut that this amount
may be included as part of the debtor's cure of defaults under
the Franchise Agreements. The debtor stated that the "cross-
default" provision at issue does not restrict the debtor's
assumption of its executory contracts.


NUMATICS INC.: S&P Puts B and CCC+ Debt Ratings on Watch
--------------------------------------------------------
Standard & Poor's placed its ratings on Numatics Inc. on
CreditWatch with negative implications. These are:

      * Corporate credit rating at B
      * Senior secured bank loan rating at B
      * Subordinated debt at CCC+

Total debt as of March 31, 2001, was $163.4 million.

The CreditWatch placement reflects Numatics' weaker-than-
expected operating performance in the first quarter of fiscal
2001 following disappointing results in the fourth quarter of
fiscal 2000, resulting in weak credit protection measures,
limited financial flexibility, and heightened financial risk.

The company's revenue fell 11.8%, and EBIT dropped 37% in the
first quarter ended March 31, 2001, compared with the same
period in 2000. The decline in sales and operating income was
primarily due to the general economic slowdown in North America,
changes in product mix, and lower fixed cost absorption as a
result of lower volume.

The company's weak operating performance during a time of
elevated debt levels resulted in weaker credit protection
measures with EBITDA interest coverage at 1.4 times (x) and
total debt to EBITDA at approximately 7.1 times (x) for the past
12 months as of March 31, 2001. In addition, Numatics' liquidity
position is constrained, with less than $1 million of cash and
$12 million available under its credit facility as of March 31,
2001.

The Michigan-based company is a leading manufacturer of four-way
pneumatic valves, actuators, and other related products.

Standard & Poor's will meet with the company's senior management
to discuss the prospects for achieving operating improvements in
2001. If it appears operating performance and credit protection
measures will remain below expected levels for an extended
period, and that liquidity will remain constrained, ratings
could be lowered, Standard & Poor's said.


PILLOWTEX: Selling Loom Equipment For $1.87M To Textile Trading
---------------------------------------------------------------
Pillowtex Corporation inked an agreement to sell their loom
equipment for $1,872,700 in cash to Textile Trading Company,
free and clear of all property interests. By motion, the Debtors
want Judge Robinson to approve the purchase agreement with
Textile Trading Company.

The loom equipment consists of 352 Sulzer single-beam looms.

The Debtors contend the loom equipment is no longer necessary
for the successful operation of their businesses and should be
sold because their Rowan County, North Carolina plant, which
used the loom equipment, already closed several months ago.

The purchase agreement with Textile Trading Company is fair and
reasonable, Gregory M. Gordon, Esq., at Jones, Day, Reavis &
Pogue argued, since it is a result of the thorough, rigorous
bidding procedures previously approved by the Court. The
Debtors' sales agent, Tex-Mach, Inc., helped conduct extensive
solicitation of bids, negotiations with prospective purchasers,
until the highest bidder emerged.

Under the purchase agreement, the Debtors will sell the loom
equipment for $1,872,700 to Textile Trading Company. Textile
Trading Company paid an earnest deposit of $187,270 or ten
percent of the contract price to Chicago Title Insurance Company
upon the execution of the Purchase Agreement.

Textile Trading Company also agreed to pay the remaining balance
as follows: $532,000 upon approval of the sale by the Court;
$532,000 forty-five days after the approval of the sale by the
court; and the remainder of the purchase price, less the deposit
and interest thereon, ninety days after the approval of the sale
by the court.

In return, Textile Trading Company may remove 100 looms after
receipt of the first payment, another 100 looms after the second
payment, and the final 152 looms after receipt of the third
payment. (Pillowtex Bankruptcy News, Issue No. 7; Bankruptcy
Creditors' Service, Inc., 609/392-0900)


POTLATCH: Fitch Lowers Senior Unsecured Debt Rating To BBB-
-----------------------------------------------------------
Fitch has downgraded Potlatch's senior unsecured long-term debt
to `BBB-` from `BBB' and downgraded the ratings on Potlatch's
commercial paper to `F3' from `F2'. This action is prompted by a
refinancing of the company's capital structure, which will place
a new class of secured debt ahead of existing senior unsecured
debtholders. Fitch has also assigned a prospective `BBB' rating
to Potlatch's new senior secured bank/institutional debt and a
prospective `BB+' rating to Potlatch's new senior subordinated
debt.

Potlatch's new bank facilities (a $200 million revolving credit
and a $200 million bullet term loan) will be secured by accounts
receivable, inventory and 130,000 acres of timberland. If fully
utilized, secured debtholders could constitute a substantial
portion of total debt. Senior unsecured debt could represent 52%
as a class. Potlatch is also seeking to raise $250 million in a
senior subordinated note issue.

The company is continuing to experience difficulty in most
segments of its business (bleached paperboard, market pulp, and
coated papers) that make it unlikely that any substantial
reduction of debt will occur in the current year, despite a
curtailment in capital expenditures. Tissue markets have been
favorable, and both lumber and OSB have rebounded substantially
during the last two months due to the increase in seasonal
homebuilding starts. However, absent a dramatic sustainable
turnaround in Potlatch's weaker businesses (especially wood
products) and/or some adjustment to Potlatch's dividend policy,
meaningful changes in credit statistics are unlikely. Fitch
notes that the company has made marked progress in lowering its
energy costs, which severely hurt the company's operations out
West in the last half of 2000 and in the first quarter of this
year.


PROVANT: Long-Term Shareholders Form Committee to Restore Value
---------------------------------------------------------------
A group of long-term shareholders representing 10.5% of the
outstanding shares of Provant, Inc. (NASDAQ: POVT) announced
that it has formed the Provant Committee to Restore Shareholder
Value. A spokesperson for the Committee said, "These
shareholders have come together in response to the relentless
destruction of shareholder value that Provant shareholders have
endured since the current CEO's appointment was announced on
March 22, 2000. Since that time, Provant's operational
performance has been abysmal and as a result its financial
condition has deteriorated substantially." The Committee notes
that Provant's stock price has declined almost 70% since the
announcement of the current CEO's appointment. On Friday, June
8, 2001, Provant closed at $2.31 per share.

The Committee intends to propose an alternative slate of
directors at the Company's upcoming annual meeting. Upon
election, the new Board's first order of business will be to
appoint a new corporate management team including a new Chief
Executive Officer. Because the annual meeting is several months
away and the need for the Committee's proposed changes as
outlined below is immediate, representatives of the Committee
are seeking a meeting with the current Board to express the
Committee's concerns and to discuss the immediate implementation
of its proposed changes.

A spokesperson said the Committee had received expressions of
interest in joining the Committee from additional Provant
shareholders which, together with the existing members, would
represent in excess of 25% of Provant's outstanding shares. Such
an aggregation of shareholders might, however, have triggered
the application of Provant's poison pill and this ambiguity and
the consequent potential for confusion in the marketplace for
Provant's shares compelled the Committee to decline at this time
the inclusion of such additional shareholders. The Committee
plans to petition the current Board of Directors to waive the
application of the poison pill in this instance, thereby
allowing Provant shareholders to exercise the most basic of
their shareholder rights.

Based on the CEO's last conference call with investors on May
10, 2001, the Committee is under the impression that one of the
strategic alternatives being considered is the sale of one or
more of Provant's core assets. Such assets would include,
without limitation, Sales Performance International (Solution
Selling), Senn-Delaney Leadership Consulting Group, Strategic
Interactive, PMSI-Project Mentors, J. Howard & Associates and
Star Mountain. The Committee is vehemently opposed to any such
sale, characterizing it as "strategic suicide". The Committee
notes that the combination and integration of Provant's core
assets gives the Company a huge competitive advantage making it
unique in the corporate training industry as a "one stop shop".
The Committee's view is that any such sale represents the first
step in the liquidation of Provant which could very well result
in the continued destruction of all or substantially all of
Provant's remaining shareholder value. To the extent that the
Board pursues such a sale, the Committee will review all of its
options, including legal remedies, to prevent such a sale.

As noted above, upon election of the Committee's alternative
slate of directors, the first order of business will be to
appoint a new corporate management team, including a new Chief
Executive Officer. The Committee expects that the new CEO would
have prior experience at the most senior levels in leading
education, training, consulting or professional services
organizations. In addition the Committee expects that the new
Board would embark upon a number of initiatives including,
without limitation, increased focus on cost management as well
as an acceleration of Provant's integration of its core business
lines, thus enhancing its position with large corporate and
governmental customers as a provider of a total training
solution. Other initiatives would include enhancing Provant's
financial condition by focusing on working capital management,
enhancing the Company's relationship with its bank and
consummating a substantial equity infusion from a significant
institutional investor who would bring, in addition to financial
resources, credibility, strategic insight and important customer
and industry contacts. While current management may be pursuing
some or all of these initiatives, their performance to date does
not give the Committee confidence that they can execute to
improve shareholder value.

Information about the participants on the Committee and their
direct or indirect interests in Provant may be obtained from the
Committee's financial advisor, Epic Partners, at 116 West 23rd
Street, 5th floor, New York NY 10011, (646) 375-2123.

The Committee will file with the Securities and Exchange
Commission and will furnish to security holders of Provant a
proxy statement.


RIVERWOOD HOLDING: Unit Plans To Sell Securities To Pay Debt
------------------------------------------------------------
Riverwood International Corporation, an indirect subsidiary of
Riverwood Holding, Inc, intends to issue $250 million of 10 5/8%
Senior Notes Due August 2007, as a separate new issue. The
offering is expected to close in June. The closing is dependent
upon, among other things, certain amendments to the Company's
senior secured credit agreement. The net proceeds of the
offering will be applied to repay borrowings under the Company's
senior secured credit agreement. The Notes will be guaranteed by
Riverwood Holding, Inc. and RIC Holding, Inc. (the parent
company of Riverwood International Corporation). The Notes have
not been and will not be registered under the Securities Act of
1933, as amended, and may not be offered or sold in the United
States absent registration or an applicable exemption from the
registration requirements of the Securities Act of 1933, as
amended.


SAFETY-KLEEN: Resolves Claims Dispute With Toyota
-------------------------------------------------
Safety-Kleen Corp. and Toyota have resolved their disputes
pertaining to the assumption of forklift leases and concluded it
by agreement submitted to Judge Walsh for his review and
approval. The Debtors will pay to Toyota the sum of $4,824 as a
cure amount, reflecting all previously unpaid payments due for
the period from September 2000 through March 2001, subject to
the Debtors' representation that in February 2001 the Debtors
forwarded the sum of $2,558.85 to Toyota's payment processing
center.

The Debtors are to continue to make monthly payments until the
earlier of the date on which the Debtors file a motion to reject
or terminate the agreements with Toyota, or the agreements
terminate of their own terms. In the event that the Debtors fail
to make the monthly payments, or unless the agreements terminate
by their own terms or are rejected by the Debtors, Toyota will
give written notice of the same to counsel for the Debtors. If
no cure is had within ten days, then the stay is automatically
terminated without further order of the Court.

Within 60 days of the termination of the agreements by rejection
or by their own terms, Toyota may file a proof of claim or amend
any claim previously filed in these cases to reflect any amounts
remaining due to Toyota under these agreements. The Debtors
reserve the right to object on any bankruptcy or non-bankruptcy
basis to Toyota's proof of claim, including claims that the
agreements are disguised financing agreements. Nothing in this
agreement may be deemed an admission by the Debtors that these
agreements are true leases.

Within fourteen days, the Debtors must provide Toyota with the
current locations of the forklifts, and copies of the insurance
and maintenance records for each, including information as
available on the status of payments on any maintenance
agreements for the forklifts, but only to the extent that such
records are in the Debtors' possession and have not been
previously provided to Toyota.

Concluding this matter, Judge Walsh promptly ordered it into
effect. (Safety-Kleen Bankruptcy News, Issue No. 16; Bankruptcy
Creditors' Service, Inc., 609/392-0900)


SENIOR HOUSING: Commences $50 Million Trust Preferred Offering
--------------------------------------------------------------
Senior Housing Properties Trust (NYSE: SNH) announced today that
it intends to make a public offering of $50 million of trust
preferred securities. The trust preferred securities will have a
liquidation preference of $25 per share. The distribution rate
will be set at the time of the pricing of the offering, which is
expected to occur later this month.

SNH will use the proceeds of the offering to repay outstanding
borrowings on SNH's revolving credit facility.

An application will be made to list the Trust Preferred
Securities on the New York Stock Exchange.

The joint book-running managers for the offering are UBS Warburg
and Salomon Smith Barney. Co-managers of this offering are A.G.
Edwards & Sons, Inc., First Union Securities, Inc., Prudential
Securities, Credit Suisse First Boston and Tucker Anthony Sutro
Capital Markets.


STELLEX TECHNOLOGIES: Files Consolidated Plan of Reorganization
---------------------------------------------------------------
Stellex Technologies, Inc. announced it has filed its
consolidated plan of reorganization and disclosure statement in
the U.S. Bankruptcy Court for the District of Delaware. The plan
is supported by Stellex's senior lenders and the Committee of
Unsecured Creditors.

On April 20, 2001, Stellex had announced it intended to propose
a "stand-alone" plan of reorganization with the Bankruptcy Court
under which Stellex would be owned by its creditors. The plan,
filed last Friday, June 08, 2001, would achieve that goal. The
court has scheduled a hearing to consider approval of the
disclosure statement on July 12, 2001.

P. Roger Byer, Chief Financial Officer of Stellex, stated, "This
is a very important step in moving Stellex through the process
that would allow the Company to reorganize and exit from
bankruptcy. The Company, and its major creditors, are confident
that this process can be completed by early September."

Stellex is a leading provider of highly engineered subsystems
and components for the aerospace and defense industries and
operates through its subsidiary Stellex Aerostructures. Stellex
Aerostructures is comprised of three subsidiaries, Stellex
Monitor, Stellex Precision and Stellex Aerospace. Stellex
Aerospace includes Bandy Machining, Paragon Precision, Scanning
Electron Analysis Laboratories and General Inspection
Laboratories and is involved primarily in the precision
machining of turbomachinery components, aircraft hinges and
other structural components for the aerospace and space
industries. Monitor and Precision are leaders in the
manufacturing of large complex machined parts and structural
sub-assembly components and provide various consulting services
to the aerospace industry.


VIDEO UPDATE: Court Approves $5MM DIP Loan From Movie Gallery
-------------------------------------------------------------
Video Update Inc. (OTC Bulletin Board: VUPDA) announced the
signing of a debtor-in-possession financing agreement with
Dothan, Alabama-based Movie Gallery Inc. (Nasdaq: MOVI).
Effective, June 7, Video Update received final Bankruptcy Court
approval for $5 million in new financing from Movie Gallery. In
addition, the Bankruptcy Court approved a seventh amended cash
collateral order providing increased carve-outs for the benefit
of Video Update's key trade vendors.

Last month Movie Gallery purchased the senior secured debt of
Video Update from a group of the company's lenders. Video Update
filed for Chapter 11 bankruptcy protection in September 2000.
After Movie Gallery acquired the senior secured debt, Video
Update's five-member board of directors and three of its
officers resigned. The new three-member board has appointed new
corporate officers. The new directors include Robert A. Baker,
John J. Jump and James A. Skelton. Mr. Baker is president and
CEO of RAB Associates in Los Angeles, which is active in the
field of financial reorganizations and business turnarounds. Mr.
Jump, a video industry veteran and former executive vice
president of Sight and Sound Distributors, has been elected
chairman of the new board. Mr. Skelton is a founding principal
of Crossroads LLC, a firm that specializes in financial and
operational corporate restructurings, and has most recently been
serving as Chief Restructuring Officer of Video Update.

Daniel Potter, co-founder, chairman and chief executive officer;
Daniel Howard, chief operating officer and board member; and
executive vice president Richard Bedard all resigned in
connection with separation agreements that were also approved by
the Bankruptcy Court on June 7. Mr. Bedard's brother John Bedard
was the co-founder and former president of the company who also
resigned earlier this year. The company's three former outside
directors also resigned.

In addition to his board seat, Mr. Skelton has been named
interim president and CEO of Video Update. He remains Chief
Restructuring Officer. Jack Spencer, who has been serving as
Chief Financial Officer of the company since December, has been
named to the additional posts of interim corporate secretary and
treasurer.

"These corporate governance and management changes are a
necessary step towards completing the restructuring process and
will help bring us closer to our objective of emerging from
Chapter 11," Mr. Skelton said. "The additional financing will
provide Video Update with the necessary time to complete its
review of all the strategic options for our remaining store
operations."

St. Paul-based Video Update Inc. currently owns and operates
more than 350 video specialty retail stores in the United States
and Canada.


VLASIC FOODS: US Trustee Appoints Unsecured Creditors' Committee
----------------------------------------------------------------
The United States Trustee for Region III appoints these entities
to serve as members of the Official Committee of Unsecured
Creditors in Vlasic Foods International, Inc.'s Chapter 11
cases:

            Bank of New York, as Trustee
            Attn: Jack Stevenson
            101 Barclay Street, 21W
            New York, New York 10286
            Tele: (212) 815-5086
            Fax: (212) 815-5915

            Abe Siemens
            47 Princeton Drive
            Rancho Mirage, California 92270
            Tele: (760) 324-5087
            Fax: (760) 324-4448

            Connecticut General Life Insurance Company
            c/o Times Square Capital Management, Inc.
            Attn: Noah Matthew Postyn
            4 Times Square, 25th Floor
            New York, New York 10036-9998
            Tele: (917) 342-7954
            Fax: (917) 342-7901

            Equitable Life Assurance Society of the United States
            c/o Alliance Capital
            Attn: Katalin E. Kutasi
            1345 Avenue of the Americas
            New York, New York 10105
            Tele: (212) 969-1590
            Fax: (212) 969-6820

            Gramercy Growth Fund, LP
            Attn: Nicholas W. Walsh
            3 Sheridan Square, Suite# 11E
            New York, New York 10014
            Tele: (646) 336-5740
            Fax: (212) 255-6624

            Detroit Edison
            Attn: Sonja L. Mitchell
            26801 Northwestern Highway
            Southfield, Michigan 48034
            Tele: (248) 223-2171
            Fax: (248) 223-2170

            Lincoln Graphics, A Division of Schawk, Inc.
            Attn: James M. Townsend
            1110 Cornell Avenue
            Cherry Hill, New Jersey 08002
            Tele: (856) 662-3433
            Fax: (856) 662-5957

Joseph J. McMahon, Jr., Esq., is the Staff Attorney for the
United States Trustee assigned to the Debtors' cases. (Vlasic
Foods Bankruptcy News, Issue No. 5; Bankruptcy Creditors'
Service, Inc., 609/392-0900)


WARNACO GROUP: Files Chapter 11 Petition in S.D. New York
---------------------------------------------------------
The Warnaco Group, Inc. (NYSE: WAC) announced that the Company,
and certain of its subsidiaries, have voluntarily petitioned for
protection under Chapter 11 of the U.S. Bankruptcy Code with the
U.S. Bankruptcy Court for the Southern District of New York.

The Company's international subsidiaries, including operating
entities in Canada, Mexico, Europe, Latin America and Asia, will
be largely unaffected by the filing. While operating under the
protection of Chapter 11, the Company will seek to increase
operating liquidity and continue the operational and financial
restructuring it began in 2000.

The combination of a general economic downturn, a softening
retail environment, an increasingly competitive industry and the
Company's debt obligations all contributed to the need for the
filing. The Company has conducted a thorough and careful review
of all of its available options and has concluded that a
reorganization under Chapter 11 is the only way to secure
additional operating liquidity, stabilize the Company, and
maintain sufficient flexibility to restructure its debt and
continue its operating turnaround.

The Company emphasized that during the voluntary restructuring
process, day-to-day business operations will continue
uninterrupted.

The Warnaco Group, Inc., headquartered in New York, is a leading
manufacturer of intimate apparel, menswear, jeanswear, swimwear,
men's and women's sportswear, better dresses, fragrances and
accessories sold under such brands as Warner's(R), Olga(R), Van
Raalte(R), Lejaby(R), Weight Watchers(R), Bodyslimmers(R),
Izka(R), Chaps by Ralph Lauren(R), Calvin Klein(R) men's,
women's, and children's underwear, men's accessories, and men's,
women's, junior women's and children's jeans,
Speedo(R)/Authentic Fitness(R) men's, women's and children's
swimwear, sportswear and swimwear accessories, Polo by Ralph
Lauren(R) women's and girls' swimwear, Oscar de la Renta(R),
Anne Cole Collection(R), Cole of California(R) and Catalina(R)
swimwear, A.B.S. (R) Women's sportswear and better dresses and
Penhaligon's(R) fragrances and accessories.


WARNACO GROUP: Case Summary & 30 Largest Unsecured Creditors
------------------------------------------------------------
Lead Debtor: The Warnaco Group, Inc.
              90 Park Avenue
              New York, New York, 10016

Debtor affiliates filing separate chapter 11 petitions:

              184 Benton Street Inc.
              A.B.S. Clothing Collection, Inc.
              Abbeville Manufacturing Company
              AEI Management Corporation
              Authentic Fitness Corporation
              Authentic Fitness On-Line, Inc.
              Authentic Fitness Products, Inc.
              Authentic Fitness Retail Inc.
              Blanche, Inc.
              CCC Acquisition Corp.
              CCC Acquisition Realty Corp
              C.F. Hathaway Company
              Calvin Klein Jeanswear Company
              CKJ Holdings, Inc.
              CKJ Sourcing, Inc.
              Designer Holdings Ltd.
              Gregory Street, Inc.
              Jeanswear Holdings, Inc.
              Kai Jay Manufacturing Company
              Myrtle Avenue, Inc.
              Outlet Holdings, Inc.
              Outlet Stores, Inc.
              Penhaligon's By Request, Inc.
              Rio Sportswear, Inc.
              Ubertech Products, Inc.
              Ventures Ltd.
              Warmana Limited
              Warnaco Inc.
              Warnaco International, Inc.
              Warnaco International, LLC
              Warnaco Men's Sportswear Inc.
              Warnaco of Canada Company
              Warnaco Puerto Rico, Inc
              Warnaco Sourcing, Inc.
              Warnaco U.S., Inc.
              Warnaco Ventures Ltd.
              Warners de Costa Rica Inc.

Type of Business: Manufacturer of intimate apparel, menswear,
                   jeanswear, swimwear, men's and women's
                   sportswear, better dresses, fragrances and
                   accessories

Chapter 11 Petition Date: June 11, 2001

Court: Southern District of New York

Bankruptcy Case Nos.: 01-41643-rlb through 01-41680-rlb,
                       inclusive

Judge: Richard L. Bohanon

Debtors' Counsel: Elizabeth McColm, Esq.
                   Kelley Ann Cornish, Esq.
                   Sidley, Austin Brown & Wood
                   875 Third Avenue
                   New York, NY 10021
                   (212) 906-2000
                   Fax (212) 906-2021

                   Skadden, Arps, Slate, Meagher & Flom LLP

                   Blake, Cassels & Graydon LLP

                   Rosenman & Colin, LLP

Total Assets: $2,372,705,638

Total Debts: $3,078,347,176

List of Debtors' 30 Largest Unsecured Creditors:

Entity                        Nature Of Claim       Claim Amount
------                        ---------------       ------------
The Bank of New York          Convertible           $120,000,000
Attn: Julie Salovitch-        Subordinated
       Miller                  Debenture
101 Barclay Street
New York, NY 10286
Tel:(212) 815-5359
Fax:(212) 815-5915

Amster Rothsein               Attorneys fees and      $3,240,339
& Ebnstein                    cost
Attn: Nancy Coron
90 Park Avenue
New York City, NY 10016
Tel: (212) 697-5995
Fax: (212) 286-0854

Charbet                       Trade Vendor            $1,918,941
Attn: David Casty
299 Church Street
Alton, RI 02894
Tel: (617) 968-0219
Fax: (401) 364-3390

Green Orange                  Trade Vendor            $1,711,757
Attn: Agnes
2811 Sierra Pine Avenue
Los Angeles, CA 90023
Tel: (323) 264-0210
Fax: (323) 264-1456

Miliken & Co.                 Trade Vendor            $1,242,884
Attn: Kevin Cummins
1045 Sixth Avenue
New York, NY 10018
Tel: (212) 819-4214 ext. 4279
Fax: (212) 819-4279

Liberty Fabrics               Trade Vendor              $943,988
Attn: Richard Hubbard
PO Box 651440
Charlotte, NC 28265-1440
Tel: (540) 832-2261 ext. 3715
Fax: (540) 672-9091

Elastic Corp.                 Trade Vendor              $563,342
Attn: Edward Gleadall
PO Box 100270
Atlanta, GA 30384-0270
Tel: (800) 633-4538
Fax: (205) 669-8616

Kentucky Textiles, Inc.       Trade Vendor              $549,914
Attn: Rick Hicks
One 20th Street
Paris, KY 40361
Tel: (859) 987-5228
Fax: (859) 987-8375

TKO Apparel, Inc.             Trade Vendor              $545,810
Attn: James D. Tate or
       Richard Khon
1175 NE 125th Street
North Miami, Florida 3316-1305
Tel: (305) 891-1107
Fax: (305) 891-2577

HIS Equipment Services        Equipment Supplier        $514,178
PO Box 191156
Brooklyn, NY 112169
Tel: (718) 435-222
Fax: (718) 435-0335

Systech Solutions, Inc.       Trade Vendor              $498,439
Attn: Sudha Gullapudi
550 N Brand STE 1200
Glendale, CA 91203
Tel: (818) 550-9690
Fax: (818) 550-9692

Affiliated Temporary Help     Temporary labor           $449,301
Attn: Allen                   provider
4359 Florence Ave.
Bell, CA 90201
Tel: (213) 771-1383
Fax: (213) 771-8300

Nemanco Inc.                  Trade Vendor              $420,098
Attn: Don Fulton
PO Box 268
Philadelphia, MS 39350
Tel: (601) 656-7361
Fax: (601)656-7645

Blue Shield California        Insurance Provider        $406,404
Attn: Legal Dept.
50 Beale Street
San Francisco CA 94105
Tel: (415) 229-500

Santa Fe Footwear Corp.       Trade Vendor              $358,331
Attn: Jane Jone
14850 Spring Ave.
Santa Fe springs, CA 90670
Tel: (562) 802-0680
Fax: (562) 802-0850

Galey & Lord Industries,      Trade Vendor              $327,188
Inc.
Attn: Jim Webber
PO Box 651440
Charlotte, NC 28275-1200
Tel: (212) 465-3008
Fax: (212) 465-3025

Noyon, Inc.                   Trade Vendor              $327,188
Attn: Stacey Myer
45 West 34th Street, Suite 400
New York, NY 10001
Attn: Stacey Myer
Tel: (212) 971-0160
Fax: (212) 971-0175

Insolito Srl                  Trade Vendor              $320,378
Attn: Michael St John
Corso Italia 49
20122 Milano, Italy
Tel: 011 390258315270
Fax: 011 390258315369

UPS Consolidated              Shipping                  $313,577
643 West 43rd Street
8th Floor
New York, NY 10036
Tel: (800) 742-5877

Pro Staff                     Temporary labor           $307,591
Attn: Justine Audiss          provider
File # 56026
Los Angeles, CA 90074-7707
Tel: (562) 795-7707
Fax: 795-7710

Sights Denim Systems Inc.     Trade Vendor              $306,868
PO Box 88264
Dept Y
Chicago, IL 60680-1264
Tel: (270) 826-0647

Connecticut General           Insurance Provider        $293,789
Life Insurance
(CIGNA)
PO Box 360201
Pittsburgh, PA 15251-6201
Tel: (860) 534-8830

Keystone Health Plan West     Employee Benefits         $277,826
120 5th Avenue                Provider
Pittsburgh, PA
Tel: (412) 544-700

Computer General Solutions    Trade Vendor              $267,494
Attn: Rita Kagan
PO Box 19153A
Newark, NJ 07195-9153
Tel: (212) 408-3892
Fax: (212) 977-7474

Kaiser Foundation-Hawaii      Insurance Provider        $263,586
711 Kapiolani Blvd
Honolulu, HI
Tel: (808) 591-5955

Xerox                         Equipment Provider        $252,394
Attn: Fabian Lara
PO Box 827598
Philadelphia, PA 19182-7598
Tel: (773) 380-3231
Fax: (773) 380-3120

Cananwill Inc.                Trade Vendor              $213,708

Lawson Software               Trade Vendor              $204,122

Pakias Transport, Inc.        Trucking                  $200,140

Plastiform                    Trade Vendor              $194,313


WARNACO GROUP: BCSI Providing Gavel-to-Gavel Newsletter Coverage
----------------------------------------------------------------
Bankruptcy Creditors' Service, Inc., launched publication of
Warnaco Bankruptcy News yesterday.  A free copy of the first
issue of that newsletter is available from the InterNet
Bankruptcy Library at http://www.bankrupt.com/warnaco.txt--
providing many details about the filing not available from other
news sources.


WARNACO GROUP: Obtains Court Nod for $600 Million DIP Financing
---------------------------------------------------------------
The Warnaco Group, Inc. (NYSE: WAC) announced that the U.S.
Bankruptcy Court for the Southern District of New York has
approved, on an interim basis, the Company's $600 million
Debtor-in-Possession (DIP) financing agreement from a consortium
of banks led by Citibank, J.P. Morgan Chase and The Bank of Nova
Scotia.

The Court's interim approval permits $375 million of the DIP
facility to be made available to the company effective
immediately, with the balance of the financing commitment, $225
million, set for approval on July 9, 2001.

The Company believes that the financing package will, among
other things, provide ample funding to maintain normalized
business with its vendors post-petition and maintain
uninterrupted distribution of its products to its customers.

"We are very pleased to have received the commitment for a $600
million DIP line to finance our ongoing operations and support
our portfolio of world-class brands as we reorganize our
business," said Linda J. Wachner, Chairman and Chief Executive
Officer of Warnaco. "With this new financing and our experienced
management team, we now have the elements in place to put
Warnaco back on the track toward financial stability. The
addition of Tony Alvarez to the management team this past month
as Chief Restructuring Officer brings extensive restructuring
and reorganization expertise to successfully complete this
process."

Tony Alvarez is a Founding Managing Director of Alvarez &
Marsal, Inc. Mr. Alvarez has served as a turnaround manager or
consultant for a number of companies across a variety of
industries.


WHEELING-PITTSBURGH: Settles American Electric Power Disputes
-------------------------------------------------------------
Wheeling-Pittsburgh Steel Corporation, speaking through Scott N.
Opincar of Calfee, Halter & Griswold, asked Judge Bodoh to
review and approve settlement of its lease and royalties
disputes with American Electric Power relating to coal and
associated mining rights in Brooke and Ohio Counties, West
Virginia, and Washington County, Pennsylvania. WPSC told Judge
Bodoh that, in December 1970, WPSC and AEP, through its
affiliate Ohio Power Corporation, and Ohio Power Corporation's
wholly-owned subsidiary Windsor Coal Company, entered into a
Coal Lease Agreement by which AEP leased WPSC's coal interests
and associated mining rights located in the No. 8 coal seam in
Ohio and Brooke Counties, West Virginia, and Washington County,
Pennsylvania, to AEP. AEP is required to pay royalties to WPSC
of at least $75,308 per year. The term of the lease is 40 years,
or until all mineable and merchantable coal had been extracted
from the coal seam.

Since July 1999, WPSC and AEP have disputed whether the
remaining coal is mineable and merchantable. In addition, WPSC
alleges that AEP has failed to make certain royalty payments
that are required under the Lease.

After several negotiations over one year, AEP has agreed to
settle this dispute by terminating the Coal Lease. Under the
terms of the Lease Termination Agreement, AEP will pay WPSC
approximately $534,000 in respect of past royalties and
wheelage, based on wheelage at the rate of $.05 per ton, and
including any real estate/coal taxes which may remain unpaid
through the termination date. As an additional element of the
settlement AEP has agreed to purchase all of WPSC's coal
interest and associated mining rights located in Brooke and Ohio
Counties, West Virginia, and Washington County, Pennsylvania,
located in the No. 8 coal seam, and which compromise the leased
tracks, in exchange for a cash payment to WPSC of $2.5 million.
The purchase price is apportioned at $2,499,999 for the
termination of the coal lease, and the remainder for the
purchase of the coal. This purchase will be free and clear of
all liens, mortgages and encumbrances, but subject to existing
covenants, conditions, restrictions and reservations of record,
and non-delinquent real estate taxes and assessments.

WPSC advised Judge Bodoh that if these disputes with AEP had not
been resolved, a potentially costly and protracted litigation
might have ensued. Moreover, the Sale/Purchase Agreement and the
Lease Termination Agreement represent a favorable outcome to
WPSC because they will produce aggregate cash payments of
approximately $3,000,000 to WPSC in the near term. In light of
this, WPSC urged Judge Bodoh to approve the settlement and sale,
telling him the coal being sold in no longer useful in the
conduct of WPSC's business, and it is therefore in the best
interest of the estate to make this sale. (Wheeling-Pittsburgh
Bankruptcy News, Issue No. 7; Bankruptcy Creditors' Service,
Inc., 609/392-0900)


WHEELING-PITTSBURGH: Steel Loan Board Director Plans a Visit
------------------------------------------------------------
Edward J. Casselle, the Executive Director of the Emergency
Steel Loan Guarantee Board, will meet with Wheeling-Pittsburgh
Steel Corporation executives and local officials of the United
Steelworkers of America and tour company facilities. Plans call
for Casselle to visit the company's Steubenville primary
operations, Yorkville finishing plant, Martins Ferry galvanizing
plant and Beech Bottom painting and roll forming facility.

"We are grateful that Mr. Casselle is taking the time to visit
Wheeling- Pittsburgh Steel and better understand our operations.
A loan guaranteed by the Emergency Steel Loan Guarantee Board
would benefit Wheeling-Pittsburgh as we continue to make
progress toward emerging from bankruptcy," said James G.
Bradley, President of Wheeling-Pittsburgh Steel.

Currently, Wheeling-Pittsburgh Steel does not have an
application for a loan guarantee before the Board. The company
was approved for a $35 million loan guarantee in 2000. However,
it withdrew its request in the months before it filed for
bankruptcy on Nov. 16, 2000.

Casselle said the reason for his visit was to better understand
Wheeling- Pittsburgh Steel's operations and how it might use a
government guaranteed loan.

"I am hopeful that Wheeling-Pittsburgh will find a lender who
will submit an application for a guarantee under the program,"
Casselle said. "In the application, Wheeling-Pittsburgh will
explain its need for funding and how a loan will aid in the
company's recovery. My visit will help me better understand the
issues involved."


* Meetings, Conferences and Seminars
------------------------------------
June 13-16, 2001
    Association of Insolvency & Restructuring Advisors
       Annual Conference
          Hyatt Newporter, Newport Beach, California
             Contact: 541-858-1665 or aira@airacira.org

June 14-16, 2001
    ALI-ABA
       Partnerships, LLCs, and LLPs: Uniform Acts,
       Taxations, Drafting, Securities, and Bankruptcy
          Swissotel, Chicago, Illinois
             Contact: 1-800-CLE-NEWS or http://www.ali-aba.org

June 18-19, 2001
    American Bankruptcy Institute
       Investment Banking Program
          Association of the Bar of the City of New York
          New York, New York
             Contact: 1-703-739-0800 or http://www.abiworld.org

June 21-22, 2001
    RENAISSANCE AMERICAN MANAGEMENT & BEARD GROUP, INC.
       Bankruptcy Sales & Acquisitions
          The Renaissance Stanford Court Hotel,
          San Francisco, California
             Contact: 1-903-592-5169 or ram@ballistic.com

June 25-26, 2001
    TURNAROUND MANAGEMENT ASSOCIATION
       Advanced Education Workshop
          The NYU Salomon Center at the Stern School
          of Business, New York, NY
             Contact: 312-822-9700 or info@turnaround.org

June 27-30, 2001
    NORTON INSTITUTES ON BANKRUPTCY LAW
       Western Mountains, Advanced Bankruptcy Law
          Jackson Lake Lodge, Jackson Hole, Wyoming
             Contact: 770-535-7722 or Nortoninst@aol.com

June 28-July 1, 2001
    NORTON INSTITUTES ON BANKRUPTCY LAW
       Western Mountains, Advanced Bankruptcy Law
          Jackson Lake Lodge, Jackson Hole, Wyoming
             Contact: 770-535-7722 or Nortoninst@aol.com

June 28-July 1, 2001
    American Bankruptcy Institute
       Hawaii CLE Program
          Outrigger Wailea Resort, Maui, Hawaii
             Contact: 1-703-739-0800 or http://www.abiworld.org

June 30 through July 5, 2001
    National Association of Chapter 13 Trustees
       Annual Seminar
          Marriott Hotel and Marina, San Diego, California
             Contact: 1-800-445-8629 or http://www.nactt.com

July 12-15, 2001
    American Bankruptcy Institute
       Northeast Bankruptcy Conference
           Stoweflake Resort, Stowe, Vermont
             Contact: 1-703-739-0800 or http://www.abiworld.org

July 17-20, 2001
    INSOL International
       6th World Congress
          London, England
             Contact: tina@insol.ision.co.uk or
                  http://www.insol2001.com

July 26-28, 2001
    ALI-ABA
       Chapter 11 Business Reorganizations
          Hotel Loretto, Santa Fe, New Mexico
             Contact: 1-800-CLE-NEWS or http://www.ali-aba.org

August 1-4, 2001
    American Bankruptcy Institute
       Southeast Bankruptcy Conference
          The Ritz-Carlton, Amelia Island, Florida
             Contact: 1-703-739-0800 or http://www.abiworld.org

August 10-11, 2001
    Association of Insolvency and Restructuring Advisors
       Distressed M&A Conference
          Ocean Place Conference Resort, Long Branch, New Jersey
             Contact: aira@airacira.org

September 6-9, 2001
    American Bankruptcy Institute
       Southwest Bankruptcy Conference
          The Four Seasons Hotel, Las Vegas, Nevada
             Contact: 1-703-739-0800 or http://www.abiworld.org

September 7-11, 2001
    National Association of Bankruptcy Trustees
       Annual Conference
          Sanibel Harbor Resort, Ft. Myers, Florida
             Contact: 1-800-445-8629 or http://www.nabt.com

September 10-11, 2001
    RENAISSANCE AMERICAN MANAGEMENT, INC. & BEARD GROUP
       Fourth Annual Conference on Corporate Reorganizations
          The Knickerbocker Hotel, Chicago, IL
             Contact 1-903-592-5169 or ram@ballistic.com

September 13-14, 2001
    ALI-ABA
       Corporate Mergers and Acquisitions
          Washington Monarch, Washington, D. C.
             Contact:  1-800-CLE-NEWS or http://www.ali-aba.org

September 14-15, 2001
    American Bankruptcy Institute
       ABI/Georgetown Program "Views from the Bench"
          Georgetown University Law Center, Washington, D.C.
             Contact: 1-703-739-0800 or http://www.abiworld.org

October 3-6, 2001
    American Bankruptcy Institute
       Litigation Skills Symposium
          Emory University School of Law, Atlanta, Georgia
             Contact: 1-703-739-0800 or http://www.abiworld.org

October 12-16, 2001
    TURNAROUND MANAGEMENT ASSOCIATION
       2001 Annual Conference
          The Breakers, Palm Beach, FL
             Contact: 312-822-9700 or info@turnaround.org

October 16-17, 2001
    International Women's Insolvency and Restructuring
    Confederation (IWIRC)
       Annual Fall Conference
          Somewhere in Orlando, Florida
             Contact: 703-449-1316 or
                  http://www.inetresults.com/iwirc

November 26-27, 2001
    RENAISSANCE AMERICAN MANAGEMENT, INC. & BEARD GROUP
       Seventh Annual Conference on Distressed Investing
          The Plaza Hotel, New York City
             Contact 1-903-592-5169 or ram@ballistic.com

November 29-December 1, 2001
    American Bankruptcy Institute
       Winter Leadership Conference
          La Costa Resort & Spa, Carlsbad, California
             Contact: 1-703-739-0800 or http://www.abiworld.org

January 31 - February 2, 2002
    American Bankruptcy Institute
       Rocky Mountain Bankruptcy Conference
          Westin Tabor Center, Denver, Colorado
             Contact: 1-703-739-0800 or http://www.abiworld.org

January 11-16, 2002
    Law Education Institute, Inc
       National CLE Conference(R) - Bankruptcy Law
          Steamboat Grand Resort, Steamboat Springs, Colorado
             Contact: 1-800-926-5895 or
                  http://www.lawedinstitute.com

February 28-March 1, 2002
    ALI-ABA
       Corporate Mergers and Acquisitions
          Renaissance Stanford Court, San Francisco, California
             Contact: 1-800-CLE-NEWS or http://www.ali-aba.org

March 3-6, 2002 (tentative)
    NORTON INSTITUTES ON BANKRUPTCY LAW
       Norton Bankruptcy Litigation Institute I
          Park City Marriott Hotel, Park City, Utah
             Contact:  770-535-7722 or Nortoninst@aol.com

March 15, 2002 (Tentative)
    American Bankruptcy Institute
       Bankruptcy Battleground West
          Century Plaza Hotel, Los Angeles, California
             Contact: 1-703-739-0800 or http://www.abiworld.org

April 10-13, 2002 (tentative)
    NORTON INSTITUTES ON BANKRUPTCY LAW
       Norton Bankruptcy Litigation Institute II
          Flamingo Hilton, Las Vegas, Nevada
             Contact:  770-535-7722 or Nortoninst@aol.com

April 18-21, 2002
    American Bankruptcy Institute
       Annual Spring Meeting
          J.W. Marriott, Washington, D.C.
             Contact: 1-703-739-0800 or http://www.abiworld.org

May 13, 2002 (Tentative)
    American Bankruptcy Institute
       New York City Bankruptcy Conference
          Association of the Bar of the City of New York
          New York, New York
             Contact: 1-703-739-0800 or http://www.abiworld.org

June 6-9, 2002
    American Bankruptcy Institute
       Central States Bankruptcy Workshop
          Grand Traverse Resort, Traverse City, Michigan
             Contact: 1-703-739-0800 or http://www.abiworld.org

June __, 2002
    American Bankruptcy Institute
       Delaware Bankruptcy Conference
          Hotel Dupont, Wilmington, Delaware
             Contact: 1-703-739-0800 or http://www.abiworld.org

October 9-11, 2002
    INSOL International
       Annual Regional Conference
          Beijing, China
             Contact: tina@insol.ision.co.uk or
                  http://www.insol.org

December 5-8, 2002
    American Bankruptcy Institute
       Winter Leadership Conference
          The Westin, La Plaoma, Tucson, Arizona
             Contact: 1-703-739-0800 or http://www.abiworld.org

April 10-13, 2003
    American Bankruptcy Institute
       Annual Spring Meeting
          Grand Hyatt, Washington, D.C.
             Contact: 1-703-739-0800 or http://www.abiworld.org

December 5-8, 2003
    American Bankruptcy Institute
       Winter Leadership Conference
          La Quinta, La Quinta, California
             Contact: 1-703-739-0800 or http://www.abiworld.org

April 15-18, 2004
    American Bankruptcy Institute
       Annual Spring Meeting
          J.W. Marriott, Washington, D.C.
             Contact: 1-703-739-0800 or http://www.abiworld.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.


                            *********


Bond pricing, appearing in each Monday's edition of the TCR, is
provided by DLS Capital Partners in Dallas, Texas.

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.

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., Trenton, NJ USA, and Beard
Group, Inc., Washington, DC USA. Debra Brennan, Yvonne L.
Metzler, Bernadette de Roda, Aileen Quijano and Peter A.
Chapman, Editors.

Copyright 2001.  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 $575 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 301/951-6400.

                      *** End of Transmission ***