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

           Thursday, February 21, 2002, Vol. 6, No. 37     

                          Headlines

ANC RENTAL: Seeks Approval to Renew Insurance Agreement with AIG
ACTUANT CORP: Selling 3 Million Shares of Class A Common Stock
AMERALIA: Jacqueline Badger Converts $1.8MM Payable into Equity
ARCHIBALD CANDY: Pursuing Restructuring Talks with Noteholders
AVIATION SALES: Shareholders Approve Terms of Restructuring Plan

BIRMINGHAM STEEL: Continues Discussions Re April 1 Debt Maturity
BLOUNT INC: Completes Sale of Sporting Equipment to Reduce Debt
BRIDGE INFO: Court Confirms 2nd Amended Joint Liquidating Plan
BURLINGTON: Gets Okay to Continue & Enter Risk Management Pacts
CHILDTIME LEARNING: Q3 Results Show $5MM Working Capital Deficit

CHIQUITA BRANDS: Will Issue New Securities Under Amended Plan
CHROMATICS COLOR: Subscription Rights Will Expire on March 15
CLASSIC COMMS: Panel Hires Petrie Parkman as Financial Advisor
COMDIAL: Inks Pact to Restructure Facility with Bank of America
COMDISCO INC: Expects to File Reorganization Plan by April 15

ENRON CORP: Has Until Feb. 28 to Decide on Silicon Valley Lease
ENRON CORP: Reaches Pact to Sell Wind Assets to General Electric
EXIDE TECHNOLOGIES: Names Ian Harvie as Vice Pres. & Controller
EXIDE TECHNOLOGIES: Q3 2002 Consolidated Net Loss Tops $200MM
EXODUS COMMS: Court Approves Settlement Pact with Nova Corp.

EXODUS COMMS: Court Fixes April 12 Bar Date for Proofs of Claim
FEDERAL-MOGUL: Court Okays W.Y. Campbell as Divestiture Advisor
FRIEDE GOLDMAN: Selling AmClyde Division to Hydralift for $36MM
FRUIT OF THE LOOM: Court Okays 2nd Amended Disclosure Statement
GALEY & LORD: S&P Slashes Rating to D After Chapter 11 Filing

GLOBAL CROSSING: Wants to Give Bidding Protections to Hutchison
GLOBALNET INT'L: Crescent Intends to Swap $320K Note for Shares
GLOBALSTAR L.P.: Non-Debtor Telecom Unit Reviewing Alternatives
GOLDMAN INDUSTRIAL: Wants to Continue Cash Management System Use
GOLDMAN INDUSTRIAL: Signs-Up Bankruptcy Services as Claims Agent

GROUP TELECOM: Expects to Turn EBITDA-Positive by Fourth Quarter
GUILFORD MILLS: Homes Fashion Div. to Sell Assets to Homestead
GUILFORD MILLS: Continues Debt Workout Talks with Senior Lenders
HOLLYWOOD ENTERTAINMENT: Dec. Balance Sheet Upside-Down by $113M
HUB GROUP INC: Fails to Satisfy Nasdaq Listing Requirements

IT GROUP: Seeks Authority to Return Prepetition Goods to Vendors
IBEAM BROADCASTING: Court Extends Removal Period Until April 9
INTERACTIVE NETWORK: Sets Shareholders' Meeting for March 21
J2 COMMS: National Lampoon Buying Preferred Shares for $3MM Cash
JPM COMPANY: Sells Canadian Operations to Pay Down Bank Debt

KAISER ALUMINUM: Court OKs Payment of Prepetition Employee Wages
KELLSTROM INDUSTRIES: Files for Chapter 11 Relief in Delaware
KELLSTROM INDUSTRIES: Case Summary & 20 Largest Creditors
KITTY HAWK: Hearing on Disclosure Statement Scheduled for Mar. 6
KMART CORP: U.S. Trustee Appoints Unsecured Creditors' Committee

MAJOR AUTOMOTIVE: Violates Nasdaq Continued Listing Requirements
MCLEODUSA INC: Asks Court to Establish January 30 Record Date
METRETEK TECHNOLOGIES: Falls Short of Nasdaq Listing Standards
ONI SYSTEMS: Acquisition by Ciena Corp. Spurs S&P Watch Actions
OPTICARE HEALTH: Palisade Takes-Over 81.8% Controlling Stake

PACIFIC AEROSPACE: Enters Agreement to Restructure Debt & Equity
PAXSON COMMS: Completes Refinancing of 12.5% Preferred Stock
PSINET INC: Bar Date Moved to March 7 for Xpedior Proof of Claim
QUESTRON TECHNOLOGY: Nasdaq Delists Securities Effective Feb. 19
RCN CORP: Moody's Junks Debt Ratings Over Credit Loss Revisions

REGAL CINEMAS: Enters Deal to Keep 6 IMAX Theatres in Operation
SERVICE MERCHANDISE: Court OKs Wind-Down Employee Retention Pact
SHARED TECHNOLOGIES: Inks Pact to Sell Assets to Exus Networks
STEAKHOUSE PARTNERS: Files for Chapter 11 Petitions in Calif.
STOCKWALK GROUP: Dotcom Unit to Sell All Assets to J.B. Oxford

TELTRONICS INC: Falls Below Nasdaq Equity Listing Requirements
VERTEX INTERACTIVE: Working Capital Deficit Tops $15 Million
WINSTAR COMMS: Williams Demands Payment of Postpetition Bills

* DebtTraders' Real-Time Bond Pricing

                          *********

ANC RENTAL: Seeks Approval to Renew Insurance Agreement with AIG
----------------------------------------------------------------
ANC Rental Corporation, and its debtor-affiliates ask the Court
to authorize their assumption of existing insurance agreements
with American International Group and for permission to enter
into an insurance and risk management services program that
would, among other things, provide for the renewal of the
existing insurance policies until December 31, 2002.

Mark J. Packel, Esq., at Blank Rome Comisky & McCauley LLP in
Wilmington, Delaware, states that although the renewal of the
insurance policies falls within the ordinary course of the
Debtors' business, out of an abundance of caution and to induce
AIG to renew the existing insurance agreements, the Debtors are
requesting the approval of the said agreements. Since 1997, AIG
has provided the Debtors with general liability and commercial
automobile liability coverage. The existing insurance agreements
between the Debtors and AIG are fully-fronted policies, where
the deductible is equal to the amount of the less a nominal
amount of $1. The Debtors act as a third party administrator and
adjust and pay covered losses and expenses.

Mr. Packel submits that since the inception of the Debtors'
relationship with AIG in 1997, the Debtors' have always
performed their obligations under the agreements. He adds that
with the size and complexity of the Debtors' businesses, only a
few insurance companies are capable of providing the level of
insurance coverage and flexibility to service claims on a
nationwide basis, that is required by the Debtors and which AIG
has traditionally provided at competitive rates.

Mr. Packel explains that as a condition to renewing the Debtors'
insurance coverage, AIG has required that the Debtors assume the
existing insurance agreements from 1997 through 2001. The
renewal of the existing insurance agreements have been
negotiated by the Debtors and AIG Since November 2001. Both
parties have agreed that AIG would continue to provide insurance
coverage to the Debtors from January 1, 2002 to January 1, 2003
provided that, among other things, the Debtors provide AIG with
additional collateral in the amount of $4,500,000 in letters of
credit or cash prior to January 1, 2002, which the Debtors have
posted in late December. The Debtors would also post an
additional collateral from $2,000,000 to $4,000,000 to be posted
prior to March 15, 2002 and obtain the Court's approval of the
assumption of the existing agreements and the new insurance
agreements program by March 15, 2002.

If the conditions are not complied with, Mr. Packel relates that
the Debtors will be required to post the remaining collateral
amount of $14,000,000 on or before March 15, 2002 in order for
the new insurance program to remain in force. If the Court
approves and the insurance agreements are assumed, AIG has
agreed to review the amount of collateral on June 30, 2002 in
order to reduce it, if warranted, based on actual loss
experience. The premium for the new insurance program was paid
in December 2001 for the entire year of coverage.

According to Mr. Packel, the new Insurance Program is integral
to the Debtors' ability to rent vehicles and operate their
businesses in approximately half of the 50 states where the
Debtors do not have the authority to self-insure their
businesses. Without an insurance program, the Debtors will not
be able to conduct business in these states, which would be
detrimental to the Debtors.

Mr. Packel submits that the assumption of the existing insurance
agreements is in the best interest of the Debtors' estates and
their creditors. Assumption of the contracts, he said, will
allow the Debtors to continue their existing insurance programs
with AIG and ensure that they have necessary insurance coverage.
(ANC Rental Bankruptcy News, Issue No. 8; Bankruptcy Creditors'
Service, Inc., 609/392-0900)


ACTUANT CORP: Selling 3 Million Shares of Class A Common Stock
--------------------------------------------------------------
Actuant Corporation is offering 3,000,000 shares of its Class A
common stock. Its Class A common stock is listed on the New York
Stock Exchange under the symbol "ATU." On February 7, 2002, the
last reported sale price of its Class A common stock on the New
York Stock Exchange was $32.40 per share.

One of the underwriters, First Union Securities, Inc., is acting
under the trade name Wachovia Securities.  Actuant has granted
the underwriters a 30-day option to purchase up to an additional
450,000 shares of its Class A common stock to cover over-
allotments at the public offering price, less the underwriting
discounts and commissions.

                                           Per Share    Total
                                           --------- -----------
Public offering price.....................  $30.50   $91,500,000
Underwriting discounts and commissions....  $ 1.60   $ 4,800,000
Proceeds, before expenses,
to Actuant Corporation....................  $28.90   $86,700,000

Actuant Corporation (formerly Applied Power) applies its powers
to producing a range of tools and hydraulic equipment. The
company's engineered solutions unit offers hydraulic motion-
control systems to OEMs. Product applications include RV slide-
out and automotive convertible top actuation systems. Actuant
also makes electrical and industrial tools for wholesale and
retail sale. Its Gardner Bender unit makes handtools, wire and
cable, and other products sold through retail outlets. The
company spun off its electronic closures business -- which had
grown through acquisitions to become the largest segment -- to
shareholders as APW Ltd. in 2000. As a result of that
separation, the company changed its name to Actuant. As of
November 30, 2001, the company reported an upside-down balance
sheet, showing a total shareholders' equity deficit of $143
million.


AMERALIA: Jacqueline Badger Converts $1.8MM Payable into Equity
---------------------------------------------------------------
AmerAlia, Inc. (Nasdaq: AALA) has completed an agreement
February 6, 2002 with a principal shareholder, the Jacqueline
Badger Mars Trust, by which the Trust has converted its guaranty
fee payable of $1,780,000 into equity. Previously, the Company
and the Trust had agreed that the guaranty fee liability would
be converted into equity following an announcement of permanent
financing or a strategic alliance for the development of the
Rock School Lease project. The terms of the subscription
agreement provide for the issue of 1,780,000 restricted shares
of common stock at $1 per share with the additional provision
that if the Company makes an announcement of permanent financing
or a strategic alliance before December 31, 2002, then the
number of shares to be issued will be recalculated based on
market prices of the company's stock for the thirty days
following the announcement, up to a maximum price of $2.50 per
share.

AmerAlia, Inc. also recently filed, with the SEC, its Restated
Consolidated Financial Statements for the years ended June 30,
2001, and June 30, 2000, together with the report from its
independent certified public accountants. Certain errors were
discovered regarding the capitalization of loan guaranty fees
which resulted in understatements of assets and equity, as well
as overstating the net loss for the years ended June 30, 2001
and June 30, 2000. The combined error totaled $961,921.
Consequently, the restated shareholders funds at June 30, 2001
were $2,535,787 compared with the previously reported
$1,573,866. The differences represent capitalization of loan
guaranty fees paid by the Company during the years ended June
30, 2001 and 2000. These fees were incurred to secure the
financing for the Rock School Lease project development.

As AmerAlia previously announced, it met with a hearing panel
formed by Nasdaq to consider removing AmerAlia common stock from
the Nasdaq SmallCap market. The hearing panel requested
additional information and, to the knowledge of AmerAlia, has
not yet reached a decision. AmerAlia has no assurance that the
hearing panel will extend AmerAlia's listing on the Nasdaq
SmallCap market.

As AmerAlia has reported in its previous reports, including its
Form 10-Q for the quarter ended September 30, 2001 and Form 8K
dated December 17, 2001, AmerAlia has a loan of approximately
$10,000,000 from the Bank of America that is guaranteed by its
principal shareholder, the Jacqueline Badger Mars Trust. This
loan is due on March 31, 2002. Furthermore, AmerAlia's agreement
with the guarantor provides that the guarantor must approve any
"development arrangements" but that any development arrangement
that provides for the repayment of the loan in full by February
28, 2002, will be acceptable. AmerAlia's failure to meet the
February 28, 2002, deadline may give the guarantor cause to call
the loan earlier. AmerAlia has no assurance that either date
will be extended. AmerAlia is currently pursuing a development
plan which includes the possible acquisition of a sodium-
bicarbonate producing plant with debt and equity investment in
excess of $30,000,000 that AmerAlia hopes will be provided by
third parties. Although AmerAlia has had favorable discussions
with the prospective seller of the assets, the definitive
purchase agreement has not yet been negotiated.

Furthermore, although AmerAlia has received positive indications
from the prospective lender and equity investors, AmerAlia has
not reached any final agreement with any of these parties and
there can be no assurance that AmerAlia will be able to obtain
the necessary financing, even if it does reach final agreement
with the entity contemplating selling the assets to AmerAlia. As
a result, AmerAlia cannot offer any assurance that it will be
able to complete the transactions to provide for repayment in
full of the outstanding debt by either February 28, 2002 or
March 31, 2002.


ARCHIBALD CANDY: Pursuing Restructuring Talks with Noteholders
--------------------------------------------------------------
On January 3, 2002, Archibald Candy Corporation filed a current
report with the SEC pursuant to which it reported, among other
things, that it had failed to make the approximately $8.7
million interest payment due on January 2, 2002 on its $170
million of 10-1/4% senior secured notes due 2004. Archibald
confirms that, as expected, with the 30-day grace period
applicable to Archibald's making of such interest payment having
expired, an event of default has occurred and is continuing
under the indenture pursuant to which the Senior Notes have been
issued.

Further, on January 14, 2002, Archibald filed a quarterly report
for its fiscal quarter ended November 24, 2001 pursuant to which
Archibald reported, among other things, that it would be unable
to dividend or otherwise make available to Fannie May Holdings,
Inc., the sole shareholder of Archibald, funds sufficient to
allow Holdings to make the $3.0 million redemption payment
required to be made by it on January 15, 2002 to the holders of
Holdings' senior preferred stock. Archibald confirms that, as
expected, Holdings did not make such redemption payment and will
not be able to do so by the expiration on February 14, 2002 of
the applicable 30-day grace period. Therefore, as previously
reported, all remaining redemption payments on Holdings' senior
preferred stock, which equal $10.5 million in aggregate, will be
accelerated on February 14, 2002. As also previously reported,
upon Holdings' failure to make a redemption payment when due to
the holders of its senior preferred stock, such holders may
elect a director to Holdings' Board of Directors who will have
51% of the total voting power of the Board. Any exercise of such
right would constitute a change of control under the Indenture
and would terminate the forbearance agreement that The CIT
Group/Business Credit, Inc. has provided with respect to
Archibald's revolving credit facility.

Archibald is continuing to work with holders of the Senior
Notes, CIT, Holdings' significant stockholders and investment
advisors on an overall financial restructuring, including
default waivers or forbearances, payment extensions, debt for
equity exchanges or conversions, repurchases or acquisitions of
the Senior Notes or combinations of the foregoing; however,
there can be no assurance that Archibald will succeed in a
restructuring on a timely basis or that the terms and conditions
of a restructuring would be favorable to Archibald. Archibald's
management continues to expect that it will have sufficient
availability under its revolving credit facility with CIT to
meet its working capital needs as they become due; however,
there can be no assurance that this will be the case. Archibald
does not intend to provide updates as to the status of the
restructuring discussions.


AVIATION SALES: Shareholders Approve Terms of Restructuring Plan
----------------------------------------------------------------
Aviation Sales Company (OTCBB:AVIO) reported on the results of
the special meeting of its stockholders which was held Tuesday
morning.

At the meeting, the Company's stockholders approved the terms of
the Company's previously announced restructuring. Stockholder
approval of the restructuring proposals was a condition to the
completion of the Company's currently pending note exchange
offer and rights offering, both of which are due to expire on
February 20, 2002, unless such expiration date is extended. The
following proposals relating to the restructuring were
considered and approved at the meeting:

     -- the terms of the note exchange offer pursuant to which
the Company will exchange its currently outstanding $165 million
of senior subordinated notes for up to $10 million in cash, $100
million of the Company's new 8% senior subordinated convertible
PIK notes due 2006, 4,504,595 post-reverse split shares of the
Company's common stock and warrants to purchase 3,003,063 post-
reverse split shares of the Company's common stock;

     -- the issuance of 24,024,507 shares of the Company's post-
reverse split common stock in a rights offering at a
subscription price of $.8375 per share;

     -- an amendment to the Company's certificate of
incorporation increasing the number of authorized common shares
from 30 million shares to 500 million shares; and

     -- an amendment to the Company's certificate of
incorporation to effect a reverse stock split of the Company's
issued and outstanding common stock on a one-share-for-ten-
shares basis.

Additionally, at the meeting, the Company's stockholders
ratified the adoption of the Company's 2001 Stock Option Plan
and approved an amendment to the Company's certificate of
incorporation approving a change of the Company's corporate name
from "Aviation Sales Company" to "TIMCO Aviation Services, Inc."

Aviation Sales Company is a leading independent provider of
fully integrated aviation maintenance, repair and overhaul
(MR&O) services for major commercial airlines and maintenance
and repair facilities. The Company currently operates four MR&O
businesses: TIMCO, which, with its three locations, is one of
the largest independent providers of heavy aircraft maintenance
services in North America; Aerocell Structures, which
specializes in the MR&O of airframe components, including flight
surfaces; Aircraft Interior Design, which specializes in the
refurbishment of aircraft interior components; and TIMCO Engine
Center, which refurbishes JT8D engines. The Company also
operates TIMCO Engineered Systems, which provides engineering
services to our MR&O operations and our customers.

DebtTraders reports that Aviation Sales Company's 8.125% bonds
due 2008 (AVIAS1) are trading between 48 and 40. See
http://www.debttraders.com/price.cfm?dt_sec_ticker=AVIAS1for  
real-time bond pricing.


BIRMINGHAM STEEL: Continues Discussions Re April 1 Debt Maturity
----------------------------------------------------------------
Birmingham Steel Corporation (OTCBB:BIRS) reported financial
results for the fiscal 2002 second quarter and six months ended
December 31, 2001. John D. Correnti, Chairman and Chief
Executive Officer, said that despite the economic uncertainties,
pricing pressures and general skepticism in the U.S. steel
industry which followed the September 11, 2001 tragedy, the
Company's core operations generated EBITDA cash flow (earnings
before interest, taxes, depreciation and amortization) of $12
million for the quarter and improved operating income compared
with the same quarter last year.

In December 2001, the Company also completed the sale of a mini-
mill facility in Cartersville, Georgia, which will improve
overall future financial performance and reduce debt by
approximately $90 million. The operating results and loss on
sale for the Cartersville facility have been reclassified as
discontinued operations in the current and prior-year financial
statements.

For the three months ended December 31, 2001, the Company
reported a net loss from continuing operations of $5,974,000
compared with a loss of $5,525,000 in the second quarter of the
prior fiscal year. Steel shipments were 409,000 tons, compared
with 487,000 tons in the same period last year. The average
selling price per ton in the current quarter was $261, down from
$263 last year, reflecting continued pricing pressure for all
steel products. Sales and shipments for the current quarter were
adversely impacted by deteriorating business conditions and
pricing pressures which followed September 11. Cost reductions
and operating efficiencies provided an improvement of $1.5
million in operating income in the current quarter, which was
offset by a $1.5 million increase in interest expense. The
additional interest expense was recorded pursuant to the
Company's loan agreements because the idled special bar quality
(SBQ) assets were not sold by specified dates.

For the six months ended December 31, 2001, the Company reported
a net loss from continuing operations of $1,994,000  compared
with $4,881,000 in the same period of the prior year. Steel
shipments in the current fiscal period were 915,000 tons,
compared with 1,069,000 tons last year.

Correnti commented, "Based upon normal seasonal factors and the
unfortunate events that impacted business conditions in the
U.S., we were not disappointed in second quarter financial
performance. Following the tragic terrorist attacks on September
11, the pace of our steel shipments slowed and steel selling
prices came under renewed pressure. Despite these factors,
operating income and gross profit from continuing operations
improved compared to the prior-year results."

Correnti stated, "The most significant event of the second
quarter was completion of the sale of the Cartersville, Georgia,
operation to AmeriSteel Corporation. Although we were pleased
with improvements in costs and operating efficiencies during the
past year, the Cartersville facility was severely impacted by
the prolonged distressed market conditions in the steel
industry. In the current economic environment, the sale of
Cartersville was key to continuing our progress and returning
Birmingham Steel to profitability. In addition to eliminating
operating losses and improving future cash flow, the transaction
will result in a substantial $90 million reduction in debt."

Correnti said the Company is completing documentation with
respect to the pending sale of the Company's SBQ facilities in
Cleveland, Ohio, to Charter Manufacturing, Inc., and expects the
transaction will close on or before February 28, 2000. Correnti
said the Company will reduce debt by approximately $20 million
as a result of the Cleveland sale.

Correnti said the Company continues discussions with its lenders
regarding debt maturities scheduled for April 1 and the
extension, restructuring or refinancing of its debt. Correnti
said the Company continues to maintain sufficient liquidity
under its revolving credit facility and remains in compliance
with all covenants pursuant to its loan agreements. Correnti
said Birmingham Steel recently engaged CIBC World Markets Corp.
to assist in discussions with the lenders and to evaluate other
strategic alternatives the Company is considering. Correnti also
said Birmingham Steel's directors and advisors are evaluating
the recent unsolicited offer by Nucor Corporation to purchase
the Company's core assets.

Correnti said, "As we approach the seasonally strong spring and
summer construction months, we see indications that market
conditions may be improving. We recently announced price
increases of $15 per ton for rebar and $20 per ton for merchant
products, which will become effective March 4. We also expect
the Bush Administration will follow through on its previous
decision to enforce existing anti-dumping laws and support trade
actions initiated by domestic steel producers."

Birmingham Steel operates in the mini mill segment of the steel
industry and conducts operations at facilities located across
the United States. The common stock of Birmingham Steel is
traded on the OTC bulletin board under the symbol "BIRS."

At December 31, 2001, Birmingham Steel's balance sheet showed a
working capital deficiency of $315 million, and a total
shareholders' equity deficit of $177 million.


BLOUNT INC: Completes Sale of Sporting Equipment to Reduce Debt
---------------------------------------------------------------
Blount International, Inc. (NYSE: BLT) reported results for the
fourth quarter and year ended December 31, 2001.

          Results For The Quarter Ended December 31, 2001

For the fourth quarter of 2001, sales were $119.0 million,
approximately equal to the prior year's fourth quarter sales of
$119.7 million (Sporting Equipment treated as discontinued
operations for all periods due to sale in 2001).  Income from
operations before restructuring expenses was $16.1 million, a
25.8 percent increase from the previous year's fourth quarter of
$12.8 million.  Earnings before interest, taxes, depreciation,
amortization and nonrecurring costs (EBITDA) for the fourth
quarter were $20.4 million, compared to last year's fourth
quarter EBITDA of $19.6 million.  Loss from continuing
operations before extraordinary items for the fourth quarter was
$3.6 million as compared to last year's loss from continuing
operations for the quarter of $7.3 million.  Net loss from
discontinued operations (Sporting Equipment) of $9.8 million
($0.32 per share) compares to net income from discontinued
operations the prior year of $6.5 million.  The fourth quarter
of 2001 includes a net loss from operations of $1.3 million and
a loss of $8.5 million from the sale of Sporting Equipment.  The
extraordinary loss of $5.5 million reflects the loss on early
extinguishment of debt primarily as a result of the Sporting
Equipment sale.  As a result, the net loss for the quarter of
$18.9 million compares to the prior year's net loss of $0.8
million.

          Results For The Year Ended December 31, 2001

For 2001, Blount achieved sales of $468.7 million, an 8.8
percent decrease from the prior year's sales of $513.9 million.  
Income from operations before restructuring expenses for the
year was $60.9 million, representing a 15.2 percent decrease
from the $71.8 million for 2000.  EBITDA before accounting for
restructuring costs of $16.2 million was $78.3 million and
compares to EBITDA of $90.6 million for 2000.  For the year,
interest expense net of interest income was $94.5 million as
compared to $98.2 million in 2000.  Loss from continuing
operations before extraordinary items was $32.1 million ($1.04
per share) compared to a loss of $11.7 million the prior year.  
Discontinued operations net income from operations in 2001 was
$2.5 million compared to $22.5 million in 2000.  Net loss for
the year was $33.3 million, or $1.09 per share before accounting
for restructuring costs of $10.3 million.  This compares to last
year's net income of $8.2 million, excluding a $2.6 million
after tax gain principally from the sale of the company
aircraft.

On announcing the results, Harold E. Layman, President and Chief
Executive Officer, stated, "We completed the sale of Sporting
Equipment during the fourth quarter and used the proceeds to
reduce debt.  We negotiated an amendment to our Credit Agreement
giving us appropriate time to focus on our Outdoor Products
Group and Industrial and Power Equipment Group, which are
leaders in their marketplaces.  Outdoor Products again enjoyed
excellent EBITDA margins, 24 percent in 2001 and recorded the
second highest sales in its history.  Industrial and Power
Equipment while still impacted by a difficult marketplace
contributed positive EBITDA.  Market conditions continue to be
soft and recovery timing continues uncertain; therefore, we
remain focused on reducing break evens and improving
productivity, efficiency and flexibility.

"At this time, based on market information, we do not expect any
significant improvement in the forestry equipment market before
the second half of 2002.  Although Outdoor Products will be
negatively impacted in early 2002 by soft conditions,
particularly in lawnmower markets, we do expect second half
improvement and therefore 2002 should be a year of only moderate
sales and earning growth."

                    Amendment To Credit Agreement

Blount previously reported that it had entered into a
forbearance agreement under its credit agreement, which among
other things provided time to complete the sale of the Sporting
Equipment group and amend the senior credit agreement as
appropriate.  Concurrent with the completion of the sale of
Sporting Equipment on December 7, 2001, the Credit Agreement was
amended relating back to September 30, 2001.

The amendment, among other things, eases financial covenants
through December 31, 2003, reduces the revolving credit portion
of the Credit Agreement from $100 million to $75 million and
increases the interest rate on outstanding amounts under the
Credit Agreement until more favorable financial ratios are
achieved.  Blount is in compliance with all of the terms of the
Credit Agreement, as amended.

Headquartered in Montgomery, Alabama, Blount International, Inc.
is a diversified international company operating in two
principal business segments:  Outdoor Products and Industrial
and Power Equipment.  Blount International, Inc. sells its
products in more than 100 countries around the world. At
December 31, 2001, the company's total shareholders' equity
deficit reached $350 million. For more information about Blount
International, Inc., please visit http://www.blount.com


BRIDGE INFO: Court Confirms 2nd Amended Joint Liquidating Plan
--------------------------------------------------------------
BIS Administration, formerly known as Bridge Information
Systems, and its debtor-affiliates obtained confirmation of
their Second Amended Joint Liquidation Plan from Judge McDonald
on February 13, 2002.

Thomas J. Moloney, Esq., Esq., at Cleary, Gottlieb, Steen &
Hamilton, and Gregory D. Willard, Esq., at Bryan Cave LLP, the
lead lawyers representing the Debtors, persuaded Judge McDonald
that all confirmation objections, to the extent not resolved or
withdrawn, be overruled.

Judge McDonald found that an overwhelming majority of creditors
voted to accept the plan, the plan satisfies each of the 13
confirmation requirements set forth in 11 U.S.C. Sec. 1129, and
the Plan, accordingly, should be confirmed.

As previously reported, the Debtors' liquidating plan proposes
to distribute roughly $500 million to creditors owed $1.5
billion. The Debtors' secured prepetition lenders -- a
consortium led by Goldman Sachs -- will receive the bulk of
those funds (approximately $450 million of $711 owed).

Judge McDonald gave his blessing to the SAVVIS settlement and
release provisions contained in Bridge's Plan, finding that they
are a necessary cornerstone of the Plan.

Cantor Fitzgerald Securities' attempt to block the plan fell on
deaf ears at Friday's hearing.  Judge McDonald declined to
earmark the Telerate Sale Proceeds for payment of Cantor
Fitzgerald's claims.  Deborah J. Volmert, Esq., at The Stolar
Partnership, argued without success that, similar to how
BridgeDSF creditors received payment from the sale of BridgeDFS,
Cantor Fitzgerald should receive a pro rata share of the
Telerate Sale Proceeds instead of using those funds to pay-down
the prepetition lenders' secured claims.

Trade creditors are projected to receive around 5 cents-on-the-
dollar for their claims. (Bridge Bankruptcy News, Issue No. 26;
Bankruptcy Creditors' Service, Inc., 609/392-0900)   


BURLINGTON: Gets Okay to Continue & Enter Risk Management Pacts
---------------------------------------------------------------
Judge Walsh of the U.S. Bankruptcy Court for the District of
Delaware grants Burlington Industries, Inc., and its debtor-
affiliates to continue and enter into various Risk Management
Transactions.

The Debtors analyzed their present need for such Risk Management
Transactions and concluded that the continuation of existing
Risk Management Transactions and the entry into new Risk
Management Transactions in a mannerconsistent with the Debtors'
pre-petition practices is reasonable and necessary to limit
financial risks and volatility -- such as the risk that
variations in the price of raw materials, currency exchange
rates or interest rates will adversely affect the Debtors.

The three Primary Risk Management Transactions are:

(A) Raw Material Contracts

     As a manufacturer of softgoods for apparel and interior
furnishings, the Debtors routinely enter into contracts to
purchase raw materials, such as cotton and wool.  In order to
protect themselves from the volatility in the market for such
materials, the Debtors may enter into a variety of different
financial derivative contracts, including forward contracts,
swaps and option contracts, or a combination of such contracts.
The Debtors enter into such contracts pursuant to standard
agreements that essentially allow them to "lock in" a specified
price for their raw materials.

     For example, the Debtors routinely enter into forward
contracts with respect to cotton and wool.  Under such
contracts, the Debtors agree to pay a certain amount of a raw
goods supplier for materials to be delivered at a specified
future date.  This type of contract ensures that the Debtors can
fix the price for key commodities used in the Debtors'
businesses, thus locking in prices regardless of fluctuations in
market prices -- and accordingly ensuring cost predictability
for such materials and corresponding profit forecasting.

(B) FX Facilities

     The Debtors routinely enter into contracts to buy and sell
products in foreign countries.  When the Debtors purchase
products from foreign vendors, the Debtors sometimes must agree
to pay for such goods in the currency of such vendor.  In such a
situation, the Debtors assume the risk that the U.S. dollar may
decline in value, thus reducing the "buying power" of the U.S.
dollar and effectively increasing the costs of such products to
the Debtors.  Because of this risk, the Debtors often may be at
a competitive disadvantage in the overseas market.  In addition,
the Debtors make sales to customers in foreign currencies and as
such assume the risk that the U.S. dollar may strengthen in
value, thus reducing the "buying power" of the foreign currency
and effectively reducing receipts from those sales.

     To reduce their exposure to fluctuations in foreign
currency exchange rates, the Debtors may enter into FX
facilities under which the Debtors can fix the amount of U.S.
dollars that the Debtors are required to pay or are entitled to
receive at a specified future date according to the value at
which the U.S. dollar is trading at the time the Debtors enter
into a contract to buy or sell products overseas.  By entering
into the FX facilities, the Debtors will be able to reduce their
exposure to fluctuations in foreign currency exchange rates and
thereby enter into contracts in the currency of the vendor or
customer. Because of these protections against foreign currency
rate volatility that a foreign exchange facility provides,
companies that conduct business internationally routinely enter
into FX facilities.

     Importantly, the Debtors do not use FX facilities as an
investment or profit-making enterprise, but rather seek to enter
into such facilities to protect themselves from market
fluctuations.  Essentially, the FX facilities that the Debtors
seek to initiate or continue should be viewed as currency
insurance policies, enabling the Debtors to compete without
assuming the risks traditionally associated with currency
fluctuations for customer/vendor transactions.

(C) Interest Rate Swap Agreements

     In the ordinary course of business, the Debtors enter into
interest rate swap agreements to alter the interest rate risk
profile of outstanding debt, thus altering the Debtors' exposure
to changes in interest rates.  In a typical interest rate swap,
one counterparty pays a fixed rate while the other assumes a
floating interest rate based on the amount of the principal of
the underlying debt.  The underlying debt, referred to as the
"notional amount" of the swap, does not change hands, only the
interest payments are exchanged.

     The Debtors continuously monitor developments in the
capital markets and only enter into such swap transactions with
established counterparties having investment-grade ratings.
Exposure to individual counterparties is controlled, and thus
the Debtors consider the risk of counterparty default to be
negligible. (Burlington Bankruptcy News, Issue No. 7; Bankruptcy
Creditors' Service, Inc., 609/392-0900)   


CHILDTIME LEARNING: Q3 Results Show $5MM Working Capital Deficit
----------------------------------------------------------------
Childtime Learning Centers, Inc. (Nasdaq: CTIM) reports third
quarter operating results including a previously announced
restructuring and unusual charge for the period ended January 4,
2002.

                         Financial Summary
               ($ in millions except per share amounts)

                           Change vs.             Change vs.
                         Q3    Prior Year   Q3 YTD    Prior Year

   Revenue              $31.0     (6.4%)     $109.7      (2.5%)

   Center cash flow       3.2    (27.8%)       13.2     (11.9%)

   EBITDA (a)             0.4    (82.0%)        3.8     (50.9%)

   Restructuring
     & unusual charge    (0.2)      NM         (2.4)       NM

   Net loss             ($0.5)      NM        ($1.6)       NM

   Net loss per share   ($0.10)      NM       ($0.30)       NM

  (a) Before restructuring
         and unusual charge        (NM - not measurable)

"While the results of Q3 are below our requirements, we are
encouraged with the progress we are making towards improving our
base business," states Alfred R. Novas, President and Chief
Executive Officer.  "We have implemented several customer
service and training initiatives over the past few months, along
with operating tools to improve margins at the center level.  
Our nearly 6,000 Childtimer teammates are very excited and
focused on executing the priorities we have set forth to
increase and retain enrollment at our Learning Centers."

                         Q3 Operating Results

Revenue declined 6.4% to $31.0 million for the 12 weeks ended
January 4, 2002, reflecting the closure of 19 Childtime Learning
Centers and ten Oxford Learning Centers during the last twelve
months, which accounted for approximately $1.8 million of the
revenue decline, and reduced enrollment at existing Learning
Centers, offset by revenue from newly developed Learning
Centers.

Center cash flow (net revenues less cash operating expenses
directly attributable to our Learning Centers) declined by $1.2
million to $3.2 million when compared to last year's third
quarter.  Cash flow margins at its Learning Centers for the
quarter ended January 4, 2002, declined 3.1 percentage points to
10.4% of revenue versus the same quarter last year.  Higher
labor and occupancy costs were somewhat offset by the benefit of
closing 19 Childtime Learning Centers and ten Oxford Learning
Centers, as well as a pricing increase implemented in the first
four weeks of the current year's second quarter.

General and administrative expenses increased by $0.6 million
over the same quarter last year of which $0.3 million was for
expenses associated with the establishment of four regional
offices and staffs opened during Q1 of this fiscal year and $0.1
million associated with the costs of training and rolling out
new center level administrative software.

Earnings before interest, taxes, depreciation and amortization
(EBITDA) and before restructuring and unusual charges of $0.2
million for the quarter ended January 4, 2002, was $2.0 million
lower than the same period last year. The drivers for the
decline include lower center cash flow contribution ($1.2
million), an increase in the provision for doubtful accounts
($0.1 million) and an increase in general and administrative
expenses ($0.6 million).  The calculation of EBITDA less
restructuring and unusual charges is not intended to represent a
measure of cash flow or operating results in accordance with
generally accepted accounting principles.  Rather, certain
investors and creditors may find this calculation a useful tool
for measuring Childtime's comparative performance and is not
intended as a comparison to other companies, whose calculation
methods may differ.

Net loss per share of ($0.10) for the third quarter ended
January 4, 2002, compared to net earnings per share of $0.13 for
the same period last year.

On January 31, 2002, the Company amended and restated its
revolving line of credit agreement and entered into a revised
$17.5 million revolving line of credit agreement with its
existing lender.  The revised credit agreement will mature on
September 30, 2004, and is secured by the Company's receivables,
equipment and certain real estate.

Operating since 1967, Childtime enjoys a long history as a
leader of for-profit childcare services in the United States.  
Today, the Company operates 287 Learning Centers in 23 states
and the District of Columbia.  The Company enjoys the dedication
of nearly 6,000 employees who care for approximately 26,000
children and their families. At January 4, 2002, the company had
a working capital deficit of around $5 million.


CHIQUITA BRANDS: Will Issue New Securities Under Amended Plan
-------------------------------------------------------------
Chiquita Brands International, Inc., has applied with the
Securities and Exchange Commission for Qualification of the
Indentures that will govern the new securities to be issued
under the Amended Plan, James H.M. Sprayregen, Esq., at
Kirkland & Ellis, in Chicago, Illinois, advises Judge Aug.

Currently, Mr. Sprayregen relates, the principal owners of the
voting securities -- representing a 33.4% block -- are:

       Name                              Share
       ----                              -----
      Carl H. Lindner                  2,130,406
      Keith E. Lindner                    17,335
      American Financial Group Inc.   23,996,295
                                      ----------
                               TOTAL: 26,144,036

Of the common shares owned by American Financial, approximately
43.5% is owned by Carl H. Lindner, Carl H. Lindner III, S. Craig
Lindner and Keith E. Lindner.

Pursuant to the Plan, the Debtor will issue three new types of
securities:

    * New Notes
    * New Warrants
    * New Common Stocks

(1) New Notes

The New Notes will be issued as a series of senior debt
securities proposed to be dated March 15, 2002. The New Notes
will be unsecured obligations of Reorganized Debtor and will
have the same importance as the Debtor's future senior unsecured
indebtedness.

The New Notes will mature on March 15, 2009 bearing an interest
that will be fixed at the Effective Date at a rate equal to the
sum of:

    (a) the yield for actively traded U.S. Treasury securities
        having a maturity closest to seven years as of the day
        prior to the Effective Date,

    (b) the Bear Stearns BB Index Spread, and

    (c) 100 basis points.

The Debtor plans to pay interest on the New Notes every March 15
and September 15 of each year, starting on September 15, 2002.
The New Notes will also be redeemable at the option of the
Reorganized Debtor, with prior 30 days written notice. In case
the redemption is made within the first 3 years after issuance,
the redemption value shall be for an amount equal to the greater
of:

    (a) 100% of the principal amount of the New Notes to be
        redeemed, and

    (b) the sum of the present value of the redemption amount at
        the beginning of the 4th year and the interest payments
        from the date of redemption through the beginning of the
        4th year.

If the redemption is done after the 3rd year, the redemption
shall be the accrued and unpaid interest at the time of
redemption, and:

  (a) if redeemed at the 4th year, at par plus 1/2 of the Senior
      Note Interest Rate;

  (b) if redeemed in the fifth year, at par plus 3/8 of the
      Senior Note Interest Rate;

  (c) if redeemed within the 6th year, at par plus 1/4 of the
      Senior Note Interest Rate; and

  (d) if redeemed in the seventh year after issuance, at par.

(2) New Warrants

The New Warrants will be exercisable for 13,333,333 shares of
the New Common Stock and will expire after 7 years from the
Effective Date. The New Warrants will have anti-dilution
protection for stock splits, stock dividends, stock combination
and similar transactions.

The exercise price of the New Warrants will be equal to the
"Solvency Value", which is the value per share of the New Common
Stock that, when multiplied by the number of shares of the New
Common Stock of Class 4 claims, will equal the amount of Class 4
Claims for principal plus interest on such principal through the
Effective Date.

In the event of a merger or tender offer, all or partially for
cash or other property, New Warrant Holders will have the right
to elect to receive cash or other property in the same
proportion as Holders of New Common Stock for such New Warrants
equivalent to a Black-Scholes valuation of such New Warrants as
of the date such merger or tender offer is consummated.

(3) New Common Stock

On the Effective Date, the Debtor will have 150,000,000
authorized New Common Stock shares, of which 40,000,000 will be
issued. Holders of New Common Stock will be entitled to one vote
per share on the election of directors and all other matters
submitted to a vote of shareholders. (Chiquita Bankruptcy News,
Issue No. 6; Bankruptcy Creditors' Service, Inc., 609/392-0900)   


CHROMATICS COLOR: Subscription Rights Will Expire on March 15
-------------------------------------------------------------
Chromatics Color Sciences International, Inc., is distributing
210,900,000 shares of its common stock. At no charge, non-
transferable subscription rights to purchase shares of its
common stock will be issued to persons who own Chromatics'
common stock as of the close of business on February 11, 2002,
the record date. Persons will not be entitled to receive any
rights unless they are shareholders of the Company at that time.
Such persons will receive 7 subscription rights for every 1
share of  common stock, or 1 share of common stock underlying
preferred stock or options under the 1992 Employee Stock Option
Plan as amended, that is owned on the record date. Each
subscription right will entitle purchase of 1 share of common
stock at the subscription price of $ .02 per share. The shares
are being offered directly by the Company without the services
of an underwriter or selling agent.

The subscription rights will expire at 5:00 p.m., New York City
time, on March 15, 2002, dependent on SEC review time period,
which may cause an extension of the expiration date. The
Company, at its sole discretion, may also extend the period for
exercising the rights. Rights which are not exercised by the
expiration date will expire and will have no value. Exercise of
the rights may not be revoked unless the expiration date is
extended for more than thirty days or there is a material change
in the terms of the rights offering.

If subscription rights are timely exercised, such persons will
be entitled to exercise over-subscription privileges to purchase
additional shares of the common stock at the same subscription
price.  Chromatics is undertaking this rights offering to raise
proceeds from the offering, which will be used for payables and
operating capital. The subscription rights may not be sold,
transferred or assigned, and will not be listed for trading on
any stock exchange.

The Company's common stock is listed on the Nasdaq OTC Bulletin
Board under the symbol "CCSI." On February 1, 2002 the closing
sales price of the common stock on the Nasdaq OTC Bulletin Board
was $.015.

Through its Gordon Laboratories subsidiary, the company is a
contract manufacturer of personal care products such as hair
care concoctions, cosmetics, perfumes, and skin care substances.
CCSI also has a more scientific side; it makes the ColorMate
system, which is used to perform jaundice testing on infants by
measuring changes in their skin color. The system (measuring
devices, filters, and software linked to either a handheld
device or to a computer) can distinguish approximately 200 skin-
tone categories. CCSI has used the same technology to develop
the Light Emitting Diode device, which can be used to match skin
tone with color cosmetics. At September 30, 2001, the company's
balance sheet showed a working capital deficit of $1.6 million,
and a total shareholders' equity deficit of around $600,000.


CLASSIC COMMS: Panel Hires Petrie Parkman as Financial Advisor
--------------------------------------------------------------
The Official Committee of Unsecured Creditors appointed in
Classic Communications, Inc.'s chapter 11 cases asks the U.S.
Bankruptcy Court for the District of Delaware to approve its
employment of Petrie Parkman & Co., Inc. as its financial
advisors, nunc pro tunc to December 5, 2001.

The Committee points out to the Court their reasons to retain
Petrie Parkman as their financial advisor:

    i) Petrie Parkman and its senior professionals have an
       excellent reputation for providing high quality
       investment banking services to debtors and creditors in
       bankruptcy reorganizations and other debt restructurings;

   ii) Petrie Parkman has significant capabilities in merger,
       acquisition and sale transactions; and

  iii) Petrie Parkman has extensive knowledge of the Debtors'
       business and industry operations.

Petrie Parkman will concentrate its efforts on reviewing
strategic alternatives and advising the Committee of Debtor's
efforts with regard to the restructuring process.

The Committee expects that Petrie Parkman will:

    a) meet with the Committee to develop an understanding of
       the Committee's objectives;

    b) meet with Debtors' management to develop an understanding
       of Debtors' operational and financial objectives;

    c) meet with Debtors' management and Debtors' financial
       advisors to gain a thorough understanding of the Debtors'
       assets;

    d) review Debtors' historical financial and operating
       statements to develop a perspective on the Debtors'
       performance;

    e) review Debtors' business plan and capital budget to
       develop a perspective on Debtors' business prospects;

    f) assist the Committee in developing a perspective on
       Debtors' assets and operations;

    g) assist the Committee in formulating, considering and
       proposing various transaction structures to achieve the
       Committee's objectives with respect to the
       reorganization;

    h) develop a preliminary analysis indicating potential
       reference values of Debtors, if requested;

    i) assist the Committee in assessing the likely reaction of
       the capital markets to the reorganization;

    k) advise and assist the Committee in developing a
       negotiating strategy;

    l) advise and assist the Committee in the course of its
       negotiations during the reorganization and participate in
       such meetings; and

    m) render other advisory services as may be reasonably
       requested by the Committee.

Petrie Parkman intends to work closely with both the Committee's
and the Debtors' professionals to ensure that there is no
unnecessary duplication of services performed or charged to the
Debtors' estates.

In connection with its role as financial advisor to the
Committee, Petrie Parkman retained Communication Technology
Advisors, Inc. as an independent contractor.  CTA's monthly pay
is payable from the $100,000 monthly fee that is due to Petrie
Parkman.

Classic Communications, Inc., a cable operator focused on non-
metropolitan markets in the United States, filed for Chapter 11
petition on November 13, 2001 along with its subsidiaries.
Brendan Linehan Shannon, Esq. at Young, Conaway, Stargatt &
Taylor represents the Debtors in their restructuring efforts.
When the Company filed for protection from its creditors, it
listed $711,346,000 in total assets and $641,869,000 in total
debts.


COMDIAL: Inks Pact to Restructure Facility with Bank of America
---------------------------------------------------------------
Comdial Corporation (Nasdaq:CMDL), a leading developer and
provider of enterprise telecommunications solutions, announced
that the Company has signed a letter-of-intent with Bank of
America to restructure its existing senior debt facility. This
agreement represents the capstone of the Company's successful
restructuring program, which began in late 2000.

Under the letter-of-intent, Comdial will have an $8 million
working capital facility and a $4.9 million term note. Both the
working capital facility and term note mature on March 31, 2003
and carry variable interest of prime-plus 4 percent. The term
note will start amortizing in September at a 36-month
amortization period.

Bank of America will also convert $10 million of existing debt
into Convertible Preferred Stock. The Convertible Preferred
Stock can convert at any time into a maximum of 1.5 million
common shares. This conversion ratio will be reduced to as low
as 500,000 shares, in the event the Company is able to pay down
the term note by up to $3 million. The Company will have a call
option allowing it to buy out Bank of America's Convertible
Preferred Stock at par. The Convertible Preferred Stock carries
a 5 percent dividend coupon if paid with cash or 10 percent if
paid in Common Shares at the election of the Company.

Paul Suijk, Comdial chief financial officer stated, "Upon
closing the restructuring agreement, Comdial will have reached a
major milestone in its restructuring program. In addition to
restructuring our debt with Bank of America, we have negotiated
over $5 million in reductions in lease payments, vendor
payments, outstanding note payments and other liabilities. The
total combined restructuring allows us to reduce the total debt
outstanding to around $15 million by the end of the first
quarter of 2002. That is down from $41 million at the end of the
third quarter of 2000, representing a 63 percent debt reduction.
This restructuring was necessary to size the balance sheet to
the new Comdial and provide the Company with the flexibility to
attract additional investment. The Company plans to seek the
additional investment in 2002. Now that we have substantially
improved the Company's balance sheet, we will intensify our
focus on the top line with the goal of bringing the fruits of
our restructuring efforts to the bottom line."

Nick Branica, Comdial president and chief executive officer
said, "I am very pleased with this restructuring agreement. This
agreement with Bank of America combined with our other debt
reduction activities will position the Company well for the
future as we work ourselves through a very difficult market.
Comdial will now focus our energy on growth rather than
restructuring. During our restructuring, Comdial never abandoned
our strong R & D activities. Comdial is now poised with a
substantially improved balance sheet and a great product
portfolio. Our newly released family of products has seen
tremendous acceptance in spite of our financial difficulties. We
believe these developments will have a positive impact on the
sales of our products. Our IP telephones and IP networking
solutions are in the marketplace and are receiving great reviews
from our customers. Our R & D team is deploying our next
generation SIP-based communication and messaging system in house
to begin alpha testing. We are looking forward with the
confidence and pride that our balance sheet is significantly
improved, our product portfolio is strong and our product
pipeline is filled with promise for the future.

"We could not have come this far without the on-going support of
our stakeholders. My gratitude goes out to our customers,
distribution partners and dealers, suppliers, employees,
shareholders and board members, for demonstrating their loyalty
and unwavering confidence in Comdial."

Comdial Corporation, headquartered in Sarasota, Florida,
develops and markets sophisticated communications solutions for
small to mid-sized offices, government, and other organizations.
Comdial offers a broad range of solutions to enhance the
productivity of businesses, including voice switching systems,
voice over IP (VoIP), voice processing and computer telephony
integration solutions. For more information about Comdial and
its communications solutions, please visit the company's Web
site at http://www.comdial.com


COMDISCO INC: Expects to File Reorganization Plan by April 15
-------------------------------------------------------------
Comdisco, Inc. (NYSE: CDO), has determined to run off its
Comdisco Ventures portfolio over the next 36 months and
therefore will refine its proposed plan of reorganization
accordingly. As previously announced, the Company is focused on
filing its plan of reorganization by April 15, 2002. The plan
will address its core IT, Healthcare and Telecom leasing assets
in Europe and North America.

Comdisco also announced that Michael A. Fazio, president and
chief operating officer, has left the company.  Mr. Fazio joined
Comdisco as executive vice president and chief financial officer
in July 2001, shortly before the Company's Chapter 11 filing. He
was named president and COO in September 2001.

"We have made tremendous progress over the past several months,
as the Comdisco board has explored a wide range of alternatives
and implemented asset sales and taken other appropriate actions
to provide value for our stakeholders," said Norm Blake,
Comdisco chairman and chief executive officer. "Michael Fazio
played an instrumental role in this process and we greatly
appreciate his many contributions. At the same time, we
understand his desire to move on to new challenges at this time
and wish him well."

Since its voluntary filing for reorganization under Chapter 11
of the U.S. Bankruptcy Code in July 2001, Comdisco sold its
Availability Solutions business to SunGard in November, 2001,
received Court approval to sell its Electronics and Laboratory &
Scientific equipment leasing businesses to GE Capital's
Commercial Equipment Financing unit in January, 2002, and
received Court approval for the sale of substantially all of its
North American IT CAP services contracts to T-Systems Inc. in
February, 2002. The GE and T-Systems Inc. transactions are
expected to be completed by the end of the first quarter of
2002. Comdisco, Inc., and 50 domestic U.S. subsidiaries filed
voluntary petitions for relief under Chapter 11 of the U.S.
Bankruptcy Code in the U.S. Bankruptcy Court for the Northern
District of Illinois on July 16, 2001. The filing allows the
company to provide for an orderly sale of some of its
businesses, while resolving short-term liquidity issues and
enabling the company to reorganize on a sound financial basis to
support its continuing businesses.

Comdisco's operations located outside of the United States were
not included in the Chapter 11 reorganization cases. All of
Comdisco's businesses, including those that filed for Chapter
11, are conducting normal operations.

On February 14, 2002, the U.S. Bankruptcy Court for the Northern
District of Illinois approved the company's request for an
extension of the exclusive periods during which only Comdisco
may file a plan of reorganization and solicit acceptances for
that plan. These periods, which had been scheduled to expire on
March 15, 2002, and May 15, 2002, have now been extended to
April 15, 2002 and June 15, 2002, respectively. The company has
targeted emergence from Chapter 11 during the first half of
2002.

Comdisco -- http://www.comdisco.com-- provides technology  
services worldwide to help its customers maximize technology
functionality, while freeing them from the complexity of
managing their technology. The Rosemont (IL) company offers
leasing to key vertical industries, including semiconductor
manufacturing and electronic assembly, healthcare,
telecommunications, pharmaceutical, and biotechnology. Through
its Ventures division, Comdisco provides equipment leasing and
other financing and services to venture capital backed
companies.


ENRON CORP: Has Until Feb. 28 to Decide on Silicon Valley Lease
---------------------------------------------------------------
In a separate order, Judge Gonzalez rules that Enron Corporation
and its debtor-affiliates have until February 28, 2002 to decide
whether to assume or reject their lease with Silicon Valley
Telecom Exchange LLC.

Silicon Valley Telecom Exchange LLC is the lessee of a warehouse
that it converted into an Internet telecommunications "hotel".
Silicon Valley subleases space in the warehouse to Internet
telecommunication companies, including Enron Broadband Service,
Inc.  The one-story warehouse is 94,000 square feet in size and
located at 250 Stockton Avenue in San Jose, California.  Enron
Broadband subleases 17,809 square feet of the space.

Silicon earlier objected to the Debtors' motion to extend the
lease decision period to December 31, 2002.

Marc L. Pinckney, Esq., at Campeau, Goodsell, Diemer, in San
Jose, California, convinced Judge Gonzalez to shorten the
requested extension with these assertions:

    (a) Enron Broadband has failed to pay post-petition
        obligations to Silicon, which now total $106,662.  If
        Enron Broadband fails to pay the February rent, the debt
        will grow an additional $48,177;

    (b) Enron's continued occupation of the leased premises
        without paying its lease obligations is a financial
        hardship for Silicon since Enron's rent is 36% of the
        total rent collected by Silicon;

    (c) Enron's lease with Silicon is not essential to a plan of
        reorganization since Enron intends to end its broadband
        service; and

    (d) Enron has had sufficient time to evaluate whether to
        assume the Silicon lease since Enron's counsel advised
        Silicon in early December that Enron had already decided
        which leases it intended to rejection and that decision
        whether to reject the Silicon lease would be made by the
        end of December 2001. (Enron Bankruptcy News, Issue No.
        13; Bankruptcy Creditors' Service, Inc., 609/392-0900)


ENRON CORP: Reaches Pact to Sell Wind Assets to General Electric
----------------------------------------------------------------
Enron Corp. (OTC: ENRNQ) said it has reached an agreement to
sell the wind turbine manufacturing assets of Enron Wind Corp.,
its wind power subsidiary, to the Power Systems business of
General Electric Company.

Enron Wind is a global wind power company with leading
technology and a strong position in the three countries with the
largest demand for wind power: the U.S., Germany and Spain.  
Enron Wind operates manufacturing facilities in these three
countries and in the Netherlands and maintains eleven sales
offices in countries around the world.

"While Enron Wind has historically been a good business with
solid returns, its future growth requires more capital than we
can justify under current circumstances," said Stanley Horton,
chairman and CEO of Enron Global Services, which includes Enron
Wind.  "The proceeds of this sale will help to repay our
creditors.  I am confident that the wind company will be a good
business for GE."

The purchase includes the company's global wind turbine
manufacturing and marketing operations, but does not affect
Enron owned or operated wind farms. GE will continue to provide
operational support for most of these facilities.

In connection with the sale, Enron Wind will concurrently file a
voluntary petition for Chapter 11 reorganization in the U.S.
Bankruptcy Court for the Southern District of New York.  Subject
to necessary bankruptcy court and regulatory approvals, the
transaction is expected to close in the second quarter of 2002.

Credit Suisse First Boston and The Blackstone Group advised
Enron Wind Corp. and Enron Corp. on this transaction.

Enron Corp., delivers energy, physical commodities and other
energy services to customers around the world.  Enron's Internet
address is http://www.enron.com

DebtTraders reports that Enron Corp.'s 7.875% bonds due 2003
(ENRON1) are trading between 16 and 18.5. See
http://www.debttraders.com/price.cfm?dt_sec_ticker=ENRON1for  
real-time bond pricing.


EXIDE TECHNOLOGIES: Names Ian Harvie as Vice Pres. & Controller
---------------------------------------------------------------
Exide Technologies (OTCBB: EXDT), the global leader in stored-
electrical energy solutions, announced the appointment of Ian J.
Harvie as Vice President - Controller.

He replaces Ken Pawloski who has decided to leave the Company to
pursue other interests.

Mr. Harvie joins Exide from PricewaterhouseCoopers LLP, where he
served as a Partner in the Audit and Business Advisory Services.
He joined the firm in 1984, and has held various positions in
the U.S. and Australia. Mr. Harvie has extensive experience in
areas including financial reporting, SEC regulations, mergers
and acquisitions, operational and process improvement, program
and resource management and consumer and industrial products
companies.

Craig Muhlhauser, President and Chief Executive, said, "Ian's
appointment is an important step in our effort to recruit strong
new leadership during our operational restructuring. Ian has
more than 15 years of international experience and expertise
with consumer and industrial companies, and is an excellent
addition to my leadership team. I am confident that he will
provide the leadership to effectively implement world class
financial systems, reporting and controls required in today's
competitive business environment."

Ian Harvie said, "I am excited to join with Craig Muhlhauser,
Lisa Donahue and the Exide Technologies team as they continue to
implement a turnaround of Exide's worldwide operations and
establish a strong foundation for future growth and
profitability."

Exide Technologies is the world's largest industrial and
transportation battery producer and recycler, with operations in
89 countries. Industrial applications include network-power
batteries for telecommunications systems, fuel-cell load
leveling, electric utilities, railroads, photovoltaic (solar-
power related) and uninterruptible power supply (UPS) markets;
and motive-power batteries for a broad range of equipment uses,
including lift trucks, mining vehicles and commercial vehicles.
Transportation uses include automotive, heavy-duty truck,
agricultural, marine and other batteries, as well as new
technologies being developed for hybrid vehicles and new 42-volt
automotive applications. The Company supplies both aftermarket
and original-equipment transportation customers.

Further information about Exide Technologies, its financial
results and other information can be found at
http://www.exide.com

DebtTraders reports that Exide Technologies' 10% bonds due 2005
(EXIDE2) are trading between 30 and 35. See
http://www.debttraders.com/price.cfm?dt_sec_ticker=EXIDE2for  
real-time bond pricing.


EXIDE TECHNOLOGIES: Q3 2002 Consolidated Net Loss Tops $200MM
-------------------------------------------------------------
Exide Technologies (OTCBB:EXDT), a global leader in stored
electrical-energy solutions, announced its results for the third
quarter of fiscal 2002 ended on Dec. 31, 2001.

The company reported a consolidated net loss of $200.5 million..
This compares to consolidated net earnings of $4.0 million for
the same quarter last year.

Included in the consolidated net loss for the quarter was a non-
cash charge of $105 million resulting from the impairment of
goodwill resulting from our evaluation of third quarter results
for the Network Power business and our expectations that the
current depressed telecommunications markets will not recover to
calendar year 2000 levels.

Complete details on Exide's third quarter earnings, as well as
restructuring initiatives are publicly available in a Form 10-Q
filed by Exide on Feb. 19, 2002 with the Securities and Exchange
Commission.

Exide Technologies is an industrial and transportation battery
producer and recycler, with operations in 89 countries.

Industrial applications include network-power batteries for
telecommunications systems, fuel-cell load leveling, electric
utilities, railroads, photovoltaic (solar-power related) and
uninterruptible power supply (UPS) markets; and motive-power
batteries for a broad range of equipment uses, including lift
trucks, mining vehicles and commercial vehicles.

Transportation uses include automotive, heavy-duty truck,
agricultural, marine and other batteries, as well as new
technologies being developed for hybrid vehicles and new 42-volt
automotive applications. The company supplies both aftermarket
and original-equipment transportation customers. At September
30, 2001, the company had a total shareholders' equity deficit
of $264 million.

Further information about Exide Technologies, its financial
results and other information can be found at
http://www.exide.com  


EXODUS COMMS: Court Approves Settlement Pact with Nova Corp.
------------------------------------------------------------
Exodus Communications, Inc., and its debtor-affiliates obtained
Court approval of a Settlement Agreement, dated October 30,
2001, between Debtors and NOVA Corp. Under the Settlement
Agreement, the Debtors will assume the Master Agreement, dated
August 30, 2000, and pay approximately $10,000,000.

David R. Hurst, Esq., at Skadden Arps Slate Meagher & Flom LLP
in Wilmington, Delaware, relates that NOVA is one of the
Debtors' primary general contractors and has provided goods and
services through it and its subcontractors to construct over 18
IDCs in the United States and abroad that were provided to the
Debtors under the Master Agreement. As of the Petition Date,
NOVA was owed approximately $15,500,000 on account of pre-
petition goods and services that it and its subcontractors
provided.

Mr. Hurst submits that NOVA's continued performance under the
Master Agreement is critical to the Debtors because a number of
sites that the Debtors either intend to operate or sell to third
parties are unfinished. Due to NOVA's and its subcontractors'
familiarity with the projects, NOVA is uniquely suited to
complete the work necessary to operate the sites in a timely and
cost effective manner. If NOVA or its subcontractors are not
paid, Mr. Hurst claims that the Debtors would have to procure
replacement vendors that presumably would charge the Debtors
much more than the amount the Debtors would pay to NOVA under
the Master Agreement. In addition, replacement contractors
likely could not complete the projects in a timely manner
because such contractors would have to familiarize themselves
with the complex layouts of the IDCs and start afresh on plans
to complete the projects. Mr. Hurst adds that a number of
governmental authorities have warned the Debtors that if work is
not timely performed on certain of the Debtors' IDC sites, such
authorities will bring enforcement actions and/or refuse to
issue permits, thereby forcing the shut down and/or preventing
the opening of the Debtors' IDCs. NOVA is uniquely suited to
complete work on the Debtors' IDCs and facilitate the issuance
of necessary permits.

Under the Master Agreement, Mr. Hurst informs the Court that
NOVA and its subcontractors provide guaranties and warranties
with respect to their work at the sites, including operating
IDCs. Thus, if problems develop at one of the IDCs, NOVA
promptly will remedy such problems to prevent interruption of
services that the Debtors provide to customers, without which,
the Debtors' customer service will be severely affected and
customer goodwill eroded. Finally, Mr. Hurst believes that most
of NOVA's pre-petition claims appear to be secured by valid
mechanics' liens and thus, payment of NOVA's claims in
accordance with the Settlement Agreement will affect the timing,
but not the amount, of payment on most of NOVA's claims.

Because NOVA is a critical vendor of the Debtors whose continued
provision of goods and services is essential to the Debtors'
business operations, the Debtors and NOVA negotiated the terms
of the Settlement Agreement pursuant to which the Debtors will
assume the Master Agreement in exchange for a release of all of
NOVA's and its subcontractors' claims and the continued
provision of goods and services by Nova under the Master
Agreement.  The pertinent provisions of the Settlement Agreement
are:

A. The Debtors will pay $886,000 for services provided to the
   Debtors' non-Debtor affiliates and post-petition work
   provided to the Debtors;

B. The Debtors will issue a "critical vendor" payment in the
   amount of $1,440,000 on account of work performed at
   facilities in New Jersey and Boston;

C. The Debtors will pay $10,020,000 upon closing of the sale of
   a New Jersey IDC to a third party. This sum represents
   amounts owed on account of that New Jersey site and 75% of
   the remaining balance owed under the Master Agreement;

D. NOVA will waive, and take steps to prevent subcontractors
   from collecting, $1,275,585.30 for work performed on a London
   IDC site owned by one of the Debtors' foreign affiliates;

E. NOVA will, among other things, immediately take steps to
   perform under the Master Agreement including, completion of
   unfinished IDC sites, performance of compliance work
   required by government authorities, and honoring of
   guaranties and warranties; and

F. NOVA and its subcontractors will release the Debtors and
   their estates, and indemnify and hold them harmless from any
   and all claims and will provide satisfactory lien waivers
   with respect thereto. (Exodus Bankruptcy News, Issue No. 13;
   Bankruptcy Creditors' Service, Inc., 609/392-0900)


EXODUS COMMS: Court Fixes April 12 Bar Date for Proofs of Claim
---------------------------------------------------------------
             IN THE UNITED STATES BANKRUPTCY COURT
                  FOR THE DISTRICT OF DELAWARE

In re:                                         Case No.

EXDS, Inc.
(f/k/a Exodus Communications, Inc.)            01-10539 (SLR)
EXDS (ASI), Inc.
(f/k/a Arca Systems, Inc.)                     01-10541 (SLR)
EXDS (AISI), Inc.
(f/k/a American Information Systems, Inc.)     01-10542 (SLR)
EXDS (CTSI), Inc.
(f/k/a Cohesive Technology Solutions, Inc.)    01-10544 (SLR)
EXDS (GCI), Inc.
(f/k/a Global Center, Inc.)                    01-10545 (SLR)
EXDS (GCHC), Inc.
(f/k/a Global Center Holding, Co.)             01-10546 (SLR)
EXDS (KLI), Inc.
(f/k/a Key Labs, Inc.)                         01-10548 (SLR)
EXDS (PTI), Inc.
(f/k/a Planet, Inc.)                           01-10549 (SLR)
EXDS (SMI), Inc.
(f/k/a Service Metrics, Inc.)                  01-10551 (SLR)

          NOTICE OF BAR DATE TO FILE PROOFS OF CLAIM

   PLEASE TAKE NOTICE that the United States District Court for
the District of Delaware (the "District Court") has entered an
order establishing April 12, 2002 as the last date to file
proofs of claim for the purpose of asserting claims again any of
the above-captioned debtors and debtors-in-possession (the
"Debtors") that arose before September 26, 2001 (the "Petition
Date").

     1.  You need not file a proof of claim if you do not
dispute the amount or characterization of your claim as listed
on the Debtors' schedules of assets, liabilities and executory
contracts and statements of financial affairs (collectively, the
"Schedules") and the Schedules do not list your claim as
contingent, unliquidated or disputed.

     2.  You should not file a proof of claim if your claim (I)
is solely for principal and interest due under any of the
following debt securities issued by Exodus Communications, Inc.;
(a) 10-3/4 percent Dollar Denominated Senior Notes due 2009; (b)
10-3/4 percent Euro Denominated Senior Notes due 2009; (c)
11-1/4 percent Senior Notes Due 2008; (d) 11-3/8 percent Euro
denominated Senior Noted due 2008; (e) 11-5/8 percent Dollar
Denominated Senior Notes due 2010; (f) 4-3/4 percent Convertible
Subordinated Notes due July 15, 2008; (g) 5 percent Convertible
Subordinated Notes due March 15, 2006; or (h) 5-1/4 percent
Convertible Subordinated Notes due February 15, 2008 (this
exception does not apply to the indenture trustees for the above
notes); or (II) previously has been allowed or paid by order of
the District Court.

     3.  If you own or hold any of the Debtors' stock or other
equity securities, you need not file a proof of interest solely
on account of your ownership interest or possession of such
equity securities; provided, however, that any holder of the
Debtors' stock or other equity securities that wishes to assert
a claim against any of the Debtors that arises out of or relates
to transactions in the Debtors' securities, including, but not
limited to, claims for damages or recision based on the purchase
or sale of any such securities, must file a proof of claim on or
prior to the Bar Date (as defined below), unless another
exception set forth herein applies.

     4.  If you wish to submit a rejection damages claim arising
from the Debtors' rejection of any executory contract or
unexpired lease during these chapter 11 cases, such proof of
claim must be filed by the later of (a) thirty days after the
effective date of rejection of such executory contract or
unexpired lease as provided by an order of this Court or
pursuant to a notice under procedures approved by this Court or
(b) the Bar Date (as defined below).  Any other claims arising
before the Petition Date with respect to any leases or contracts
of the Debtors must be filed by the Bar Date.

     5.  You should not file a proof of claim if you do not have
a claim against any of the Debtors.  The Debtors or their
attorneys cannot tell you whether you have such a claim or
whether you should file a proof of claim.

     6.  If you decide to file a proof of claim, you must
complete a proof of claim form and deliver it by mail, hand
delivery or overnight courier, together with any supporting
documentation for your claim, to Logan & Company, Inc. (the
"Claims Agent"), at the following address: EXDS, Inc. f/k/a
Exodus Communications, Inc., Claims Processing Dept., c/o Logan
& Company, Inc., 546 valley Road, Upper Montclair, NJ 07043.

        Proof of claim forms may be obtained by contacting the
Claims Agent at Logan & Company, Inc., 546 Valley Road, Upper
Montclair, NJ 07043.  Further inquiries regarding filing a proof
of claim against any of the Debtors may be directed to the
Claims Agent in writing at the above address or by calling
(866)468-0582 (toll free).

     7.  If you wish to assert claims against more the one
Debtor, you must file a separate proof of claim in the case of
each Debtor against which you believe you hold a claim.  If you
than one Debtor is listed on a proof of claim form, the Debtor
will treat such claim as filed against the first-listed Debtor.  
Any claims filed in the joint administration case number (EXDS,
Inc. (f/k/a Exodus Communications, Inc.). Case NO. 01-10539
(SLR) shall be deemed filed only against ESDS, Inc., f/k/a
Exodus Communications, Inc.

     8.  Each signed original proof of claim form must be
ACTUALLY RECEIVED by the Claims Agent on or before 4:00 p.m.
Eastern time on Friday, April 12, 2002 (the "Bar Date").  The
Claims Agent shall reject any proof of claim submitted by
facsimile or electronically.

     9.  ANY CREDITOR THAT IS REQUIRED TO FILE BUT FAILS TO FILE
A PROOF OF CLAIM ON ACCOUNT OF ITS CLAIM IN ACCORDANCE WITH THE
PROCEDURES SET FORTH ABOVE ON OR BEFORE THE BAR DATE (OR SUCH
OTHER APPLICABLE DEADLINE) SHALL BE FOREVER BARRED, ESTOPPED AND
ENJOINED FROM ASSERTING SUCH CLAIM AGAINST THE DEBTORS, AND THE
DEBTORS AND THEI RPROPERTY SHALL BE FOREVER DISCHARGED FORM ANY
AND ALL INDEBTEDNESS OR LIABILITY WITH RESPECT TO SUCH CLAIM,
AND SUCH HOLDER SHALL NOT BE PERMITTED TO VOTE ON ANY PLAN OR
PARTICIPATE IN ANY DISTRIBUTION IN THE DEBTORS' CHAPTER 11 CASES
ON ACCOUNT OF SUCH CLAIM.

                              BY ORDER OF:
                              THE HONORABLE SUE L. ROBINSON
                              CHIEF UNITED STATES DISTRICT JUDGE

                          *   *   *

DebtTraders reports that Exodus Communications Inc.'s 11.625%
bonds due 2010 (EXDS3) are trading from 20.5 to 22.5. See
http://www.debttraders.com/price.cfm?dt_sec_ticker=EXDS3for  
real-time bond pricing.


FEDERAL-MOGUL: Court Okays W.Y. Campbell as Divestiture Advisor
---------------------------------------------------------------
Federal-Mogul Corporation and its debtor-affiliates obtained
Court authority to employ and retain W.Y. Campbell & Company as
investment and financial advisor in connection with the
potential divestiture of the Camshaft Group Operations, nunc pro
tunc to October 1, 2001.

Specifically, W.Y. Campbell will provide such services as the
Firm and the Debtors shall deem appropriate and feasible in
order to advise the Debtors in the Transaction, including:

A. advising the Debtors in developing their strategic objectives
   with regard to the value and terms of the Transaction;

B. identifying and demonstrating the Camshaft Group Operations'
   proprietary attributes;

C. assisting in analyzing the financial effects of the proposed
   Transaction;

D. assisting in a valuation analysis of the Camshaft Group
   Operations;

E. identifying and soliciting appropriate merger partners or
   potential buyers, as approved by the Debtors;

F. assisting in the preparation and distribution of
   confidentiality agreements and appropriate descriptive
   selling materials regarding the Transaction;

G. advising the Debtors in their preparation for due diligence
   and their management of a data room;

H. initiating discussions and negotiations with merger partners
   or prospective buyers and advising the Debtors in
   negotiations regarding the Transaction;

I. assisting the Debtors in coordinating management
   presentations and site visits, as appropriate;

J. structuring any proposed Transaction;

K. providing expert advice and testimony concerning any
   financial matters related to the Transaction;

L. providing other services necessary to the completion of a
   successful transaction, as mutually agreed upon by W.Y.
   Campbell and the Debtors; and

M. providing other financial or ancillary services in connection
   with the potential divestiture of the Camshaft Group
   Operations in the event that not all of the assets of the
   Debtors' estates or Transaction are sold.

The Court was informed that W.Y. Campbell has been providing
services to the Debtors in preparation for the potential sale of
the Debtors' Camshaft Group Operations. The Debtors submitted
that the familiarity of W.Y. Campbell's professionals with the
Camshaft Group Operations and their knowledge of the progress
being made towards divesting those businesses would increase the
Debtors' chances of successfully completing such a transaction.
The Debtors believed that the experience and expertise of W.Y.
Campbell's professionals in providing merger and acquisition
advisory services in reorganization proceedings would insure to
the benefit of the Debtors in pursuing any transactions. The
Debtors submitted that the services of W.Y. Campbell were
necessary to enable the Debtors to faithfully execute their
duties as debtors in possession and would be beneficial to the
Debtors' estates and thus, the Debtors believed W.Y. Campbell
was well qualified to represent the Debtors as their investment
bankers and financial advisors.

Andre A. Augier, Managing Director of W.Y. Campbell & Company
informed the Court that W.Y. Campbell has received $10,812.81 in
payments from the Debtors for expense reimbursements within the
ninety days prior to the Petition Date.  W.Y. Campbell received
a retainer in the amount of a $100,000 Retainer Fee in March of
2001 in connection with its engagement, and also received a
retainer in the amount of a $75,000 Retainer Fee, payable in
$25,000 installments due December 1, 2001; January 1, 2002 and
February 1, 2002. Mr. Augier explained that the $100,000 and the
$75,000 Retainer Fees received by W.Y. Campbell shall be
credited against the Transaction Fee. As of the Petition Date,
W.Y. Campbell was owed a pre-petition amount of approximately
$30,000 by the Debtors but the Firm has agreed to waive any
claim or right to payment for such unpaid pre-petition amounts.

Pursuant to the terms and conditions of the Engagement Letter
and as set forth in more detail therein, W.Y. Campbell intends
to charge for the professional services rendered to the Debtors
in these chapter 11 cases in the form of a Transaction Fee. In
addition, W.Y. Campbell will seek reimbursement for reasonable
and necessary expenses incurred in connection with the Debtors'
chapter 11 cases, including but not limited to transportation,
lodging, food, telephone, copying, delivery and messengers.
(Federal-Mogul Bankruptcy News, Issue No. 10; Bankruptcy
Creditors' Service, Inc., 609/392-0900)


FRIEDE GOLDMAN: Selling AmClyde Division to Hydralift for $36MM
---------------------------------------------------------------
Friede Goldman Halter, Inc. (FGH) (OTCBB:FGHLQ) announced the
entering into a contract with Hydralift ASA, a Norwegian
company, to acquire substantially all of the assets and
activities of AmClyde Engineered Products for approximately $36
million. AmClyde, located in St. Paul Minnesota, is one of four
business units presently operated by FGH.

The acquisition is subject to approval by the United States
Bankruptcy Court, and a possible auction proceeding that is
allowed by United States Bankruptcy Law. Closing is expected to
take place in April 2002.

In addition to the sale of this business unit, FGH and its
Official Unsecured Creditors' Committee are evaluating other
possible reorganization scenarios that are available to the
Company. The sale of AmClyde is the first step in resolving the
bankruptcy for FGH and considerable progress has been made in
the analysis of available alternatives.

Jack Stone, Principal, Glass & Associates, Inc. and Chief
Restructuring Advisor to FGH, commented, "Each of the business
units are continuing to operate as before, and the company, in
conjunction with the Unsecured Creditors' Committee, is in
continuing discussions with groups that have expressed a keen
interest in acquiring an operating division and we are also
continuing to evaluate our restructuring options. The company
expects to make additional announcements regarding progress as
developments require. At this time the company is focusing on
maximizing the recoveries for the creditors as it appears there
will not be a significant recovery if any, for our equity
security holders under the plans of reorganization currently
contemplated."

Friede Goldman Halter is a world leader in the design and
manufacture of equipment for the maritime and offshore energy
industries. Its operating units are Friede Goldman Offshore
(construction, upgrade and repair of drilling units, mobile
production units and offshore construction equipment), Halter
Marine (construction and repair of ocean-going vessels for
commercial and governmental markets), FGH Engineered Products
Group (design and manufacture of cranes, winches, mooring
systems and marine deck equipment), and Friede & Goldman Ltd.
(naval architecture and marine engineering).


FRUIT OF THE LOOM: Court Okays 2nd Amended Disclosure Statement
---------------------------------------------------------------
After a few days of deliberation, Judge Walsh put his stamp of
approval on Fruit of the Loom's Second Amended Disclosure
Statement.

March 1, 2002, is fixed as the last date for filing and serving
motions pursuant to Bankruptcy Rule 3018(a) seeking temporary
allowance of a disputed claim for voting purposes.  The hearing
on all Rule 3018(a) motions will be held on March 15, 2002, at
10:30 a.m.

The deadline for filing any objection to confirmation of the
Second Amended Plan is March 21, 2002.

The Voting Deadline is March 28, 2002.  Creditors must submit
their ballots to accept or reject the Plan by 4:00 p.m. on that
day or their votes will not be counted.

Judge Walsh will convene a Confirmation Hearing at 9:30 a.m. on
April 4, 2002, in Wilmington. (Fruit of the Loom Bankruptcy
News, Issue No. 49; Bankruptcy Creditors' Service, Inc.,
609/392-0900)   


GALEY & LORD: S&P Slashes Rating to D After Chapter 11 Filing
-------------------------------------------------------------
Standard & Poor's said that it lowered its corporate credit
rating on textile manufacturer Galey & Lord Inc. to single-'D'
from double-'C', because of the company's announcement that it
and its U.S. operating subsidiaries have filed voluntary
petitions for reorganization under Chapter 11 of the U.S.
Bankruptcy Code on Feb. 19, 2002.

About $639 million of debt was outstanding at Sept. 29, 2001.

Greensboro, N.C.-based Galey & Lord cited the need to
restructure its heavy debt load and the weak retail environment
exacerbated by the September 11 events, as the main reasons for
its filing. The company also announced it has arranged a $100
million debtor-in-possession facility, subject to bankruptcy
court approval.

Galey & Lord is a manufacturer of textiles used for sportswear,
workwear fabrics, and home furnishings.


GLOBAL CROSSING: Wants to Give Bidding Protections to Hutchison
---------------------------------------------------------------
Michael F. Walsh, Esq., at Weil Gotshal & Manges LLP in New
York, tells the Court that Hutchison Whampoa Limited and
Singapore Technologies Telemedia Pte. Ltd. have expended, and
likely will continue to expend, considerable time, money and
energy pursuing the transaction Contemplated by the Letter of
Intent and have engaged in extensive, arms'-length and good
faith negotiations. Global Crossing Ltd., and its debtor-
affiliates' determination to commence these chapter 11 cases
curtailed their ability to fully draft, negotiate and finalize a
definitive agreement with the Investors.  Nevertheless, rather
than losing the value and momentum obtained by the negotiations
conducted prior to the Commencement Date, the Debtors and the
Investors have determined to memorialize their agreement through
the LOI. Mr. Walsh explains that the LOI is the key step of the
Investors' efforts, and, as noted, is subject to higher or
better offers on the foregoing timetable and procedures, which
form a critical element of the debtors proposed reorganization
process.

In recognition of the time, energy, and resources expended in
reaching the LOI and to be expended in the furtherance of
definitive documentation and further participation by the
Investors, the Debtors have agreed to provide, and the LOI is
contingent upon the provision of, certain bidding protections to
the Investors. Specifically, the LOI provides, and the Debtors
request that the Investment Proposal Procedures Order approve, a
Termination Fee to the Investors in an aggregate amount equal to
$40,000,000 in the event that Global Crossing accepts or
approves, or the Court approves or orders, any proposal that
provides for one or more third parties:

A. to acquire in one or a series of related transactions all or
     substantially all of the assets of Global Crossing or

B. to make an investment comparable to the Hutch-STT Proposal in
     Global Crossing or sponsor, or function as an economic co-
     proponent of a plan of reorganization of Global Crossing.

Mr. Walsh explains that the Termination Fee will be payable when
the Alternate Transaction closes, provided that if an Alternate
Transaction is approved by the Court but ultimately does not
close, the Investors shall be entitled to a Termination Fee in
an aggregate amount equal to $20,000,000, payable on the
effective date of Global Crossing's plan of reorganization. The
Termination Fee will not be owed if the Investors terminate the
transaction for any reason. A Termination Fee payable only under
the circumstances described immediately above shall only be
payable out of the proceeds payable at closing of such Alternate
Transaction.

Mr. Walsh relates that the LOI provides, and the Debtors request
that the Investment Proposal Procedures Order approve Expense
Reimbursements, including those reasonable, actual, documented,
out of pocket costs and expenses, excluding any success fees,
not to exceed $10,000,000, until termination of the transaction
contemplated by the LOI. That portion of the Expense
Reimbursements consisting of a $150,000 monthly postpetition
retainer to each of Goldman Sachs (Asia) LLC, as advisor to
Hutchison, and Merrill Lynch (Singapore) Pte. Ltd., as advisor
to STT, will be paid by the Debtors upon receipt of an invoice
from such advisors. Mr. Walsh states that the balance of the
Expense Reimbursements, consisting of the actual, documented,
out of pocket costs of the Investors and their advisors listed
in the preceding sentence and the fees and expenses of the
Investors' attorneys and accountants shall be submitted, by way
of monthly fee and expense statements, to Global Crossing, the
attorneys for the Debtors' prepetition lenders, the U.S. Trustee
and the attorneys the Creditors' Committee. If Global Crossing
receives no objection within 10 business days of receipt of such
fee statement, Global Crossing shall pay the invoiced fees and
expenses but if an objection is received, Global Crossing shall
only pay the undisputed amount pending court resolution of such
dispute.

Mr. Walsh suggests that the Bidding Protections were a material
inducement for, and a condition of, the Investors' entry into
the LOI. The Debtors believe that they are fair and reasonable
in view of:

A. the intensive analysis, due diligence investigation, and
     negotiation undertaken by the Investors in connection with
     the Hutchison-STT Proposal;

B. the fact that the Investors' efforts have increased the
     chances that the Debtors will receive the highest or
     otherwise best investment offer;

C. the uncertainty inherent in an expedited chapter 11 process
     in which the Investment Proposal will be incorporated; and

D. the fact that the Investors continue, in the postpetition
     period, to negotiate with the Debtors to refine their bid.

Mr. Walsh submits that the Investors are unwilling to pursue the
Hutchison-STT Proposal under the terms of the LOI unless the
Investment Proposal Procedures Order authorizes payment of the
Termination Fee and Expense Reimbursements. Thus, absent entry
of the Investment Proposal Procedures Order and approval of the
Bidding Protections, the Debtors may lose the opportunity to
achieve and obtain what they believe to be a viable
restructuring alternative and the highest and best recovery for
their creditors.

The Debtors believe that the Bidding Protections are reasonable,
given the benefits to the estates of having a definitive LOI,
the costs incurred by the Investors and the risk to the
Investors that a third-party offer ultimately may be accepted,
and necessary to preserve and enhance the value of the Debtors'
estates. Mr. Walsh contends that The LOI and the Bidding
Protections are the product of intensive good faith, arms'-
length negotiations between the Debtors and the Investors and
their financial advisors. They are fair and reasonable in
amount, particularly in view of the Investors' efforts to date,
the risk to the Investors of being used as a "stalking horse,"
and the stabilizing effect that the execution of the LOI had and
continues to have on the Debtors' business.

Mr. Walsh points out that the Bidding Protections already have
encouraged competitive bidding, in that the Investors would not
have entered into the LOI without these provisions. The
Hutchison-STT Proposal, which was formulated only after
substantial due diligence was performed, provides a mark on
which other potential investors can rely and the mere existence
of the Bidding Protections permits the Debtors to insist that
competing proposals be materially higher or otherwise better
than the LOI, a clear benefit to the Debtors' estates. (Global
Crossing Bankruptcy News, Issue No. 3; Bankruptcy Creditors'
Service, Inc., 609/392-0900)


GLOBALNET INT'L: Crescent Intends to Swap $320K Note for Shares
---------------------------------------------------------------
On January 31, 2002, Crescent International, Ltd. delivered a
conversion notice for partial conversion of $320,000 principal
amount of the convertible note due April 9, 2004 in the
principal amount of $800,000 into 779,538 shares of GlobalNet,
Inc., common stock at a conversion price of $0.4105 per share
thereby reducing the principal amount of the convertible note to
$480,000. Such conversion notice was promptly accepted by the
Company in accordance with the terms of the convertible note and
the corresponding shares of Company common stock were delivered
to Crescent International, Ltd.

GlobalNet, Inc. provides international voice, data and Internet
services over a private IP network to international carriers and
other communication service providers in the United States and
Latin America. At June 30, 2001, the company's total current
liabilities exceeded its total current assets by about $7
million. Also at the same date, the company reported a total
shareholders' equity deficit of around $3 million.


GLOBALSTAR L.P.: Non-Debtor Telecom Unit Reviewing Alternatives
---------------------------------------------------------------
Globalstar Telecommunications Limited (OTC Bulletin Board:GSTRF)
has been notified that Globalstar, L.P. has filed for protection
under Chapter 11 of the U.S. Bankruptcy Code.

GTL's principal asset is approximately a 42% equity stake in LP.
GTL said today that its Board of Directors has met to review the
situation and determine GTL's course of action. At the present
time, GTL has indicated that it does not intend to file an
immediate bankruptcy petition but that it will continue to
monitor events and govern its actions accordingly.

GTL has been further informed that LP's reorganization plan also
calls for the cancellation of all existing partnership interests
in LP, including partnership interests held by GTL. As GTL has
cautioned earlier in public announcements and SEC filings, this
action will likely leave shares in GTL with very little or no
value. GTL has been further informed that LP's restructuring
plan also contemplates a rights offering to common shareholders
in GTL and to LP creditors which could give them the option to
purchase shares in the new company. There can be no assurance at
this time whether such rights offering could be achieved or
would have any value to GTL shareholders. In any case, such an
offering would be subject to review and approval by LP's
creditors and the bankruptcy court.

GTL also stated that in light of the options available to it,
and to conserve its limited assets, it has decided to
indefinitely postpone conducting an Annual Shareholders' Meeting
for Calendar Year 2001.


GOLDMAN INDUSTRIAL: Wants to Continue Cash Management System Use
----------------------------------------------------------------
Goldman Industrial Group, Inc., and its debtor-affiliates ask
permission from the U.S. Bankruptcy Court for the District of
Delaware to continue using their existing bank accounts,
business forms, cash management system and employee payment
system.

The U.S. Trustee has established operating guidelines for
debtors-in-possession that operate their businesses to provide a
simple way to distinguish between prepetition and postpetition
transactions and to help prevent the inadvertent pospetition
payment of prepetition claims by preventing the banks from
honoring checks drawn before the Petition Date.

The Debtors seek a waiver of this requirement because they
believe that maintenance of their bank accounts would greatly
facilitate the Debtors' "seamless transition" to post-petition
operations. The delays, confusion and disruption that might
result from requiring the Debtors to substitute new bank
accounts for the existing Bank Accounts could strain the
Debtors' relationships with various critical parties in
interest, including vendors and employees.

To minimize expense to their estates, the Debtors also request
authority to continue to use all stationary, correspondence and
business forms (purchase orders, multi-copy checks, letterhead,
envelopes, promotional materials, others), as well as checks
existing immediately before the Petition Date. However, any
checks ordered post-petition shall contain the designation of
"debtor-in-possession" with the corresponding bankruptcy number.

The Debtors point out changing such forms would be unnecessary
and burdensome to the estates, as well as expensive and
disruptive to the Debtors' business operations.

The Debtors also seek authority to continue to use their
existing cash management system. This system is driven by the
structure of the revolving credit extended to the Debtors by the
Lenders (Bank Facility). Under the Bank Facility, the Lenders
make regular deposits to the master operating accounts
maintained by four of the Debtors: Bridgeport, Hill-Loma, Bryant
and Fellows. Each of these Debtors also maintain specific
operating accounts which are funded by that Debtor's master
account.

In its Employee Payment System, Goldman Industrial oversees the
payment of its own employees and those of its subsidiaries.
Goldman Industrial contracts with Advantage Payroll Systems to
handle payroll for its domestic subsidiaries under nine
accounts. The Debtors believe that continuation of the Employee
Payment System is an ordinary course transaction. To ensure full
disclosure, the Debtors request that the Court issue an order
authorizing them to continue the Employee Payment System post-
petition.

Goldman Industrial Group, Inc., with its affiliates, provide
metalworking machinery to manufacturers; marketing and selling
original equipment primarily to the aerospace, automotive,
computer, defense, medical, farm, construction, energy,
transportation and appliance industries. The Company filed for
chapter 11 protection on February 14, 2002. Victoria W. Counihan
at Greenberg Traurig, LLP represents the Debtors in their
restructuring efforts.


GOLDMAN INDUSTRIAL: Signs-Up Bankruptcy Services as Claims Agent
----------------------------------------------------------------
Goldman Industrial Group, Inc., and its debtor-affiliates ask
the U.S. Bankruptcy Court for the District of Delaware to
approve their agreement with Bankruptcy Services LLC and
appointing BSI as agent of the Bankruptcy Court.

The Debtors believe that the most effective and efficient manner
by which to accomplish the process of noticing creditors of the
filing of these cases, and to transmit, receive, docket,
maintain, photocopy and microfilm claims, is for the Debtors to
engage an independent third party to act as an agent of the
Court.

The Debtors propose to employ BSI as notice and claims agent to
assist in distributing notices, and processing other
administrative information pertaining to these cases and to
serve as claims agent. The Debtors believe that BSI is well-
qualified to serve in this capacity and that BSI's retention is
in the best interest of the estates.  The Debtors chose BSI
based on both its experience and competitiveness of its fees.

Pursuant to the Agreement, the Debtors must provide BSI with a
deposit of $10,000 to be applied to the final invoice for the
services that BSI will provide. The Debtors propose that the
fees and expenses of BSI, as described in the Agreement and
incurred in the performance of the above services, be treated as
administrative expenses of the Debtors' estates, and be paid by
the Debtors in the ordinary course of business.

Goldman Industrial Group, Inc., with its affiliates, provide
metalworking machinery to manufacturers; marketing and selling
original equipment primarily to the aerospace, automotive,
computer, defense, medical, farm, construction, energy,
transportation and appliance industries. The Company filed for
chapter 11 protection on February 14, 2002. Victoria W. Counihan
at Greenberg Traurig, LLP represents the Debtors in their
restructuring efforts.


GROUP TELECOM: Expects to Turn EBITDA-Positive by Fourth Quarter
----------------------------------------------------------------
GT Group Telecom (TSE: GTG.A, GTG.B, NASDAQ: GTTLB), announced
it will reorganize its operations to reduce costs, while it
concentrates on managing the business to profitability and
becoming EBITDA-positive in the fourth quarter of fiscal 2002.
The reorganization will result in the loss of approximately 350
positions across all levels of the company in Canada.

The workforce reduction will reduce cash expenses by
approximately $30 million per year. The reduction will be
initiated immediately and will result in a one-time cash cost of
approximately $20 million in the second quarter of Group
Telecom's 2002 fiscal year.

"This is a difficult day for Group Telecom," said Dan Milliard,
chief executive officer Group Telecom. "We have achieved many
successes over the past two years including the completion of
our network and successful back office improvements which have
created more employee efficiencies. In addition, during this
difficult time in the economy we have a responsibility to our
shareholders, customers, and employees to ensure the company's
financial well-being while we continue to execute on our
business plan. We believe that this reorganization will have a
positive impact on our ability to turn EBITDA-positive in the
fourth quarter of fiscal 2002," Milliard said.

With this reorganization, Group Telecom now will shift its focus
from network deployment to leveraging its network assets to
profitability, increasing operational efficiency and customer
service.

"The decision to reduce our workforce is certainly not an action
we take lightly," Milliard said. "I would personally like to
acknowledge all of the employees that are impacted by this
restructuring. Their dedication has contributed greatly to our
success and we are grateful for their contributions."

Group Telecom is Canada's largest independent, facilities-based
telecommunications provider, with a national fibre-optic network
linked by 409,953 strand kilometres of fibre-optics, at December
31, 2001. Group Telecom's unique backbone architecture is built
with technologies such as Gigabit Ethernet for delivery of
enhanced network performance and Synchronous Optical Network
(SONET) for the highest level of network reliability. Group
Telecom offers next-generation high-speed data, Internet,
application and voice services, delivering enhanced
communication solutions to Canadian businesses. Group Telecom
operates with local offices in 17 markets across nine provinces
in Canada. Group Telecom's national office is in Toronto.


GUILFORD MILLS: Homes Fashion Div. to Sell Assets to Homestead
--------------------------------------------------------------
Guilford Home Fashions, a division of Guilford Mills, Inc. (OTC
Bulletin Board: GFDM), said it has agreed in principle to sell
certain assets to Homestead Fabrics, Ltd.  Terms of the sale
were not disclosed.

Homestead Fabrics is a subsidiary of Manchester, England-based
Broome & Wellington, which specializes in sourcing products for
the textile industry. Homestead Fabrics is acquiring Guilford
Home Fashions' name, trademarks, certain inventories and other
assets.

The agreement is subject to definitive documentation and other
conditions.

"We're pleased that we were able to reach an agreement with
Homestead Fabrics, which will be an excellent steward of the
brands and businesses we've developed over many years," said
John A. Emrich, President and Chief Executive Officer of
Guilford Mills, Inc.

"We're excited to be acquiring Guilford Home Fashions' excellent
brands and licenses, and we look forward to continuing to supply
the division's many customers," said David Greenstein, one of
the principals of Homestead Fabrics.

The agreement provides for Guilford Home Fashions to continue
manufacturing and distribution operations for a period of time
to ensure continual supplies to all customers.

"We have the necessary financing to continue all of Guilford
Home Fashions' existing programs and add new ones," Greenstein
said.  "We're confident that Guilford Home Fashions will be an
excellent fit with our expertise in providing turnkey, private
label programs."

Homestead does not plan to continue any of Guilford Home
Fashions' manufacturing or distribution operations.  Guilford
Home Fashions currently employs about 335 people at its
Herkimer, N.Y., and New York City locations and has laid off 125
people over the past few weeks as operations began winding down.

"We tried very hard to sell Guilford Home Fashions as an ongoing
business," Emrich said.  "But I'm sorry to say we were
unsuccessful.  I know this will be very hard on our associates
and their families."


GUILFORD MILLS: Continues Debt Workout Talks with Senior Lenders
----------------------------------------------------------------
Guilford Mills, Inc. (OTCBB: GFDM), announced operating results
for the Company's first quarter ended December 30, 2001.

First quarter sales of $137,568,000 were lower than the
$173,558,000 reported for the first quarter of the prior year.  
The Company incurred a net loss of $15,081,000 compared to the
prior year's net loss of $7,652,000.

The first quarter sales decline of 20.7% was substantially
related to the Company's decisions throughout fiscal years 2000
and 2001 to exit certain non-core businesses, primarily domestic
apparel and other fabrics dyeing and finishing.  Worldwide
Automotive Segment sales, which represented nearly 60% of the
Company's consolidated sales for the quarter, declined 6.2% from
the prior year.  The Company's domestic automotive sales were
flat despite a North American car build decline of 5%.  Direct-
to-retail Home Fashions sales increased nearly 30% as a result
of increased sales of bedding and window fabrics.  Industrial
Products segment sales decreased nearly 12%, and sales in the
Apparel and Other Fabric Segment declined 52.5% from the prior
year.

Operating margin for the first quarter was a loss of $7,817,000
compared to a loss of $5,169,000 in the prior year.  The Company
has identified its Automotive and its Industrial Products
segments, as well as its Mexican Apparel operations as core
businesses, and will focus its managerial and financial
resources on the future of these businesses.  The majority of
the operating margin decline from the prior year occurred in the
Company's non- core businesses, while operating margin in its
core businesses in the first quarter was a loss of $3.1 million
compared to a loss of $2.5 million in the prior year.  
Automotive margins continued to be reasonably strong although
price concessions to US automotive customers, declines in sales
volume in the UK, and capacity under-utilization in the US
resulted in a decline from prior year levels.  In addition,
significant professional fees incurred in connection with the
restructuring of the Company's senior debt partially offset a
decline in restructuring charges in the current year.  
Industrial Products results reflect improvement due to the lack
of such restructuring charges incurred in the prior year.  
Apparel and Other Fabrics segment losses continued to negatively
impact reported results as the Company exited its domestic
apparel operations and under-utilized its capacity in its
Altamira, Mexico facility which began production in the second
half of fiscal 2001.

The Company remains in active negotiations with its senior
lenders over the terms of a debt restructuring.  Also, the
Company's senior lenders have agreed to extend from February 15,
2002 through March 29, 2002, a waiver of the Company's non-
compliance with certain financial covenants; this waiver also
defers an interest payment date from February 15, 2002 to March
29, 2002. The Company's Form 10-Q for the quarterly period ended
December 30, 2001, filed Tuesday with the Securities and
Exchange Commission, should be read for further details.

As a result of changes in the Company's business during fiscal
2001, the Company has changed its segment definitions at the
beginning of fiscal 2002 to more accurately reflect the manner
in which the Company manages and measures its business.

In connection with the Company's operational realignment, on
February 18, 2002, the Company announced an agreement in
principle to sell certain assets of its direct-to-retail Home
Fashions segment and exit that segment of the Company's
business.

The Company has elected to delay the annual meeting of
stockholders for the 2001 fiscal year, a meeting which normally
would have been held in February or March of this year.

Guilford Mills is an integrated designer and producer of value-
added fabrics using a broad range of technologies.  The Company
is one of the largest warp knitters in the world and is a leader
in technological advances in textiles, including microdenier
warp knits and wide width circular knits of cotton blended with
LYCRA(R).  Guilford Mills serves a diversified customer base in
the apparel, automotive and industrial markets.


HOLLYWOOD ENTERTAINMENT: Dec. Balance Sheet Upside-Down by $113M
----------------------------------------------------------------
Hollywood Entertainment Corporation (Nasdaq: HLYW), owner of the
Hollywood Video chain of over 1800 video superstores, announced
adjusted diluted earnings per share of $0.32 for the fourth
quarter ended December 31, 2001, exceeding the previously
announced range for adjusted diluted earnings per share of $0.26
to $0.28.

The company reported consolidated revenue of $367.3 million for
the fourth quarter ended December 31, 2001.  Comparable store
sales increased 11% for the fourth quarter.  Income before taxes
was $36.9 million in the fourth quarter ended December 31, 2001,
and diluted earnings per share for the quarter were $1.35.

The company's net income for the fourth quarter benefited from
the reversal of accruals for planned store closures and accruals
for restructuring charges associated with the discontinuation of
the Reel.com operations.  The reversal of these accruals
increased income before taxes by $7.0 million.  As a result of
our fourth quarter earnings performance, net income for the
quarter benefited by the recognition of deferred tax assets,
primarily net operating loss carry forwards, in the amount of
approximately $14.5 million, for which the tax benefit was
previously unrecognized.  In addition, during the fourth
quarter, the company recognized additional deferred tax assets
which were previously unrecognized in the amount of $38.3
million based upon the company's 2001 earnings performance and
its outlook for 2002.  Adjusting net income to exclude these
items and to give effect to an assumed normalized effective tax
rate, adjusted net income for the quarter was $17.8 million or
$0.32 per diluted share.  The company's adjusted EBITDA for the
fourth quarter was $43.7 million.

The company reported consolidated revenue of $1.380 billion for
the year ended December 31, 2001.  Comparable store sales
increased 6% for the year. Income before taxes was $63.1 million
for the year ended December 31, 2001.  Adjusting net income to
exclude the items discussed above, and to give effect to an
assumed normalized effective tax rate, adjusted net income for
the year was $33.4 million.  The company's adjusted EBITDA for
the year was $194.7 million.

With respect to sales guidance for 2002, the company expects to
achieve comparable store sales increases of at least 3% in the
first, second, third and fourth quarters of the year.

At December 31, 2001, the company's balance sheet showed a total
shareholders' equity deficit of $113.5 million, down by almost
50% from $222.4 million recorded in the year-ago period.


HUB GROUP INC: Fails to Satisfy Nasdaq Listing Requirements
-----------------------------------------------------------
Hub Group, Inc. (Nasdaq: HUBG), said it has received a letter
from the Nasdaq National Stock Market informing the Company
that, after reviewing the Company's press release announcing
certain accounting irregularities at the Company's 65% owned
subsidiary, Nasdaq has determined that the Company's public
filings made during fiscal 1999, 2000, and 2001 do not satisfy
the Company's obligation under Nasdaq's Marketplace Rule
4310(c)(14), which, should this violation go uncorrected, could
subject its securities to delisting.  This rule requires the
Company to maintain at least three years of audited financial
statements, which the Company currently does not have since, as
previously announced, it is planning on restating certain
results due to the recently discovered accounting irregularities
at its subsidiary, Hub Group Distribution Services.  

The Company Tuesday delivered a letter to Nasdaq requesting a
hearing on this matter, which automatically stays the delisting
process due to the violation of Rule 4310(c)(14) until after the
hearing.  The Company believes that the audit of its financial
statements for 2001 and any necessary restatement for prior
years will be completed within the next several weeks and that
it will timely file its annual report on Form 10-K with the
Securities and Exchange Commission by its due date on March 31,
2002, which will result in the Company's full compliance with
Marketplace Rule 4310(c)(14).  Pending the hearing, the
Company's Class A Common Stock will continue trading on Nasdaq
under the symbol "HUBGE."  After the Company files its annual
report on Form 10-K, the Company will then seek Nasdaq approval
to again trade under the symbol "HUBG."  As stated in its
February 12, 2002 release, the Company is conducting a review of
the accounting irregularities at Hub Group Distribution Services
and has already taken action to ensure that this problem will
not recur.

Hub Group, Inc. is a leading non-asset based freight
transportation management company providing comprehensive
intermodal, truckload, LTL, railcar, air freight, international
and related logistics and distribution services.  The Company
operates through a network of over 30 offices throughout the
United States, Canada and Mexico and had 2000 sales of
approximately $1.4 billion.


IT GROUP: Seeks Authority to Return Prepetition Goods to Vendors
----------------------------------------------------------------
The IT Group, Inc., and its debtor-affiliates seek authority to
return goods purchased from Vendors prior to the Petition Date,
for credit against such Vendors' prepetition claims. The Debtors
further request that the Court enter an order prohibiting
Vendors and other third parties from taking steps to physically
reclaim or prevent delivery of goods or products to the Debtors
and confirming that third parties are stayed and prohibited from
interfering with the delivery of goods and products to the
Debtors.

Gary A. Rubin, Esq., at Skadden Arps Slate Meagher & Flom LLP in
Wilmington, Delaware, believes that certain vendors will
attempt, to assert their right to reclaim goods delivered to the
Debtors shortly before or soon after the Petition Date. To
ensure the proper categorization of reclamation demands, the
Debtors have instituted an internal system to ensure that they
appropriately date and time stamp reclamation demands as they
are received and are able to identify the Goods to which they
apply.

Mr. Rubin states that after the last timely reclamation demand
is received, which, at the latest, is 20 days after the Petition
Date in accordance with Bankruptcy Code section 546(c)(1), and
after the Debtors are thus able to quantify the aggregate amount
of reclamation claims that they believe are valid, the Debtors
intend to develop a comprehensive proposal for the treatment of
reclamation claims to all parties that delivered reclamation
demands. In connection therewith, the Debtors will inform all
parties that serve reclamation demands on the Debtors of their
position whether and to what extent each of such parties have
valid reclamation claims.

The Debtors propose that all valid reclamation claims be given
administrative expense treatment if the Vendor timely demands in
writing reclamation of Goods pursuant to section 546(c)(1) of
the Bankruptcy Code and Section 2-702 of the UCC, the Debtors
accept the Vendor's goods for delivery and the Vendor properly
identifies the Goods to be reclaimed. Furthermore, to allay
concerns of reclamation claimants, to avoid unnecessary
disruption of the Debtors' business and to minimize or eliminate
needless litigation, the Debtors agree to waive any argument
that an otherwise valid reclamation demand is rendered invalid
by:

A. a reclamation claimant's failure to take any or all possible
     "self-help" measures with respect to such Goods; or

B. the failure of a reclamation claimant to institute an
     adversary proceeding against the Debtors seeking to enjoin
     them from using or selling such Goods or any other similar
     relief.

Mr. Rubin points out that a reclamation claimant need only to
serve a timely and proper reclamation notice on the Debtors in
order to perfect its reclamation claim. Such relief will
facilitate the continued operation of the Debtors' business and
should obviate any Vendor's perceived need to initiate legal
action to preserve its rights, thereby minimizing potential
costs to the Debtors' estates in responding to such litigation.
Moreover, the disruption caused by having to administer and
analyze reclamation claims during the first few weeks of these
cases would seriously distract the Debtors' management and
professionals at a critical period in these cases.

The Debtors submit that an order approving returns to Vendors
for credit against its pre-petition claims, subject to the
limitations imposed by any orders of this Court, is in the best
interests of the Debtors' estates because such relief will
enable the Debtors to:

A. obtain trade credit and merchandise return rights that will
     make it possible for the Debtors to obtain proper credit
     for otherwise unsalable damaged merchandise,
     cost-effectively and without undue financial risk, and

B. effectively manage inventory, enhancing the Debtors'
     financial performance, the value of the assets of the
     estate and the prospects of a successful reorganization
     herein.

Absent the relief requested in this Motion, Mr. Rubin submits
that the Debtors would be required to expend substantial time
and resources:

A. convincing the Vendors of the Debtors authority to make
     certain payments,

B. reissuing the Outstanding Orders, and

C. establishing the Debtors' right to retain the Goods.

The Debtors believe that the relief requested herein will ensure
the continuous supply of Goods that are vital to the Debtors'
operations and integral to their successful reorganization. (IT
Group Bankruptcy News, Issue No. 4; Bankruptcy Creditors'
Service, Inc., 609/392-0900)  


IBEAM BROADCASTING: Court Extends Removal Period Until April 9
--------------------------------------------------------------
(Bernadette)

By order of the U.S. Bankruptcy Court for the District of
Delaware, the time within which iBeam Broadcasting Corporation
must file notices of removal of related proceedings is extended
through April 9, 2002.

iBeam Broadcasting Corporation delivers streaming media over the
Internet. The Company filed for chapter 11 protection on October
11, 2001. David B. Stratton, Esq. and David M. Fournier, Esq. at
Pepper Hamilton, LLP represent the Debtors in their
restructuring efforts. When the Company filed for protection
from its creditors, it listed $118,814,000 in total assets and
$41,910,000 in total debts.


INTERACTIVE NETWORK: Sets Shareholders' Meeting for March 21
------------------------------------------------------------
The special meeting of shareholders of Interactive Network, Inc.
will be held at 10:30 a.m., Pacific time, on Thursday, March 21,
2002, at Sofitel Hotel, 8555 Beverly Blvd., Los Angeles,
California 90048.

At the special meeting, shareholders will be asked to approve
the merger of Interactive Network, Inc. into Two Way TV (US)
Inc. (formerly known as TWIN Entertainment, Inc.), the joint
venture formed by Interactive Network and Two Way TV Limited. As
a result of the merger, shareholders of Interactive Network will
become shareholders of Two Way TV (US). After the merger, the
former shareholders of Interactive Network will own
approximately 48% of the outstanding shares of Two Way TV (US)
and 55% on a fully-diluted basis, and Two Way TV Limited will
own approximately 52% of the outstanding shares of Two Way TV
(US) and 45% on a fully-diluted basis.

In the merger, shareholders of Interactive Network will receive
one share of Two Way TV (US) for each share of Interactive
Network that they own. Therefore, Two Way TV (US) will be
issuing 43,019,277 shares in the merger to Interactive Network's
shareholders. Interactive Network's common stock currently is
quoted on The Over-the-Counter Bulletin Board under the symbol
"INNN.OB." On February 6, 2002, the closing sale price of its
common stock was $0.31 per share. Two Way TV (US)'s common stock
is privately held by its two shareholders and therefore
Interactive Network shareholders will be unable to determine the
market value of Two Way TV (US)'s shares they will receive in
the merger.

Interactive Network was incorporated in 1986 and has been
publicly traded since 1991. INNN holds core patents in the field
of interactive television. It helped pioneer and introduce
interactive TV technology by providing an interactive service
that ultimately delivered more than 40 hours of daily
interactive content to six major cities in the early '90s.Shows
made by Interactive Network included major sporting events, game
shows, murder mysteries, soap operas, educational and children's
programs, news broadcasts and many TV specials. Its major
corporate shareholders are AT&T (NYSE:T), Motorola Inc. (MOT),
General Electric Inc. (NYSE:GE), Sprint (FON), Gannett (GCI) and
A.C. Nielsen. At September 30, 2001, the company's balance sheet
showed that its total liabilities exceeded total assets by
around $3 million.


J2 COMMS: National Lampoon Buying Preferred Shares for $3MM Cash
----------------------------------------------------------------
On January 30, 2002, J2 Communications, a California
corporation, James P. Jimirro, Daniel S. Laikin, Paul Skjodt,
National Lampoon Acquisition Group LLC, a California limited
liability company, Timothy S. Durham, Samerian LLP, an Indiana
limited liability partnership, Diamond Investments, LLC, an
Indiana limited liability company, Christopher R. Williams,
Helen C. Williams, DW Leasing Company, LLC, an Indiana limited
liability company, and Judy B. Laikin entered into a non-binding
Letter of Intent.

The LOI, which is subject to the execution of definitive
documentation and shareholder approval (if required by
applicable law or Nasdaq rules), provides, without limitation,
that:

   * National Lampoon Acquisition Group or its designees will
purchase, for $3 million in cash, 30,000 shares of newly
authorized convertible preferred stock of the Company;

   * the Company will pay to Mr. Jimirro the sum of $1,100,000;

   * the Restated Employment Agreement, dated July 1, 1999,
between the Company and Mr. Jimirro will be terminated and Mr.
Jimirro will forgive the principal of, and all interest accrued
on, all outstanding contingent notes issued under that
agreement;

   * the Company and Mr. Jimirro will enter into a new
employment agreement, certain material terms of which are
described below;

   * Mr. Laikin will be appointed to the new position of Chief
Operating Officer of the Company; and

   * the parties of the LOI who are shareholders of the Company
will enter into a voting agreement providing for the composition
of a new Board of Directors of the Company. Pursuant to the
voting agreement, the Board of Directors would initially consist
of three nominees of Mr. Jimirro, three nominees of Mr. Laikin,
and one independent director.

The new employment agreement between the Company and Mr.
Jimirro, which will have a six year term, would provide Mr.
Jimirro with an annual salary of $500,000 and, commencing on
January 31, 2003 and continuing on the last day of each month
thereafter during the period that Jimirro is employed by the
Company, for the grant by the Company to Mr. Jimirro of fully
vested options to purchase 5,000 shares of the Company's common
stock. In addition, pursuant to the new employment agreement,
Mr. Jimirro would receive 50% of the Company's gross receipts
from the upcoming movie "National Lampoon's Van Wilder".

Subject to the approval of the Company's Board of Directors
required by the new employment agreement, the agreement will be
terminable by the Company without cause after December 31, 2002
upon written notice to Mr. Jimirro, payment to Mr. Jimirro of
cash in the amount of $1,400,000, and delivery of the Company's
promissory note providing for the payment of $1,000,000 one year
after the date of issuance. All of the Company's obligations to
Mr. Jimirro will be secured by a priority lien on the assets of
the Company.

The LOI further provides that, immediately following the closing
of the transactions described above, the Board of Directors of
the Company will call an annual meeting of the shareholders of
the Company. In addition, the LOI provides that National Lampoon
Acquisition Group or its designees will have the option to
purchase up to 30,000 additional shares of the Company's
convertible preferred stock on or prior to May 31, 2002.

In consideration of Mr. Jimirro's execution of the LOI and his
work with respect to the upcoming movie "National Lampoon's Van
Wilder" the Company granted Mr. Jimirro stock options to
purchase 400,000 shares of the Company's common stock. The
options vest the earlier of (i) so long as shareholder approval
of the grant of the options is obtained, and so long as the
closing of the LOI transactions occurs, upon the initial U.S.
theatrical opening date of the "National Lampoon's Van Wilder"
movie and (ii) so long as shareholder approval of the grant of
the options is obtained, the date 10 years after the date of the
LOI.

J2 Communications (Nasdaq: JTWO), which owns National Lampoon,
one of the leading brands in comedy, is an internet-based,
interactive entertainment company. Nationallampoon.com , its
newest comedy creation, employs cutting-edge technology to
deliver its own brand of biting humor on a highly interactive
comedy network created for the Internet. Showcasing hilarious
new characters and features, the site debuted in 1999. The
Company also sells advertising and merchandise on the site.
The company's October 31, 2001 balance sheet showed that the
company has a working capital deficit of almost $2 million.


JPM COMPANY: Sells Canadian Operations to Pay Down Bank Debt
------------------------------------------------------------
The JPM Company (OTC BB:JPMXE) said it has sold its Canadian
operations.

This sale is consistent with the Company's prior announcement
that it is working with its bank lenders to maximize the value
of the Company's assets, a process that will most likely result
in the sale of the Company's operations to one or more buyers.
The net proceeds of the sale of the Canadian operations were
used to reduce the Company's bank debt.

The JPM Company is a leading independent manufacturer of cable
assemblies and wire harnesses for original equipment
manufacturers and contract manufacturers in the
telecommunications, networking, computer and business automation
sectors of the global electronics industry. Headquartered in
Lewisburg, Pennsylvania; JPM also has facilities in Beaver
Springs, Pennsylvania; Sao Paulo, Brazil; Leuchtenberg, Germany
and Bela, Czech Republic.


KAISER ALUMINUM: Court OKs Payment of Prepetition Employee Wages
----------------------------------------------------------------
Kaiser Aluminum Corporation, and its debtor-affiliates sought
and obtained approval from the Court to pay:

A. certain prepetition employee and independent contractor
     wages, salaries, overtime pay, sales commissions;
     contractual compensation; sick pay; vacation pay, holiday
     pay and other accrued compensation,

B. prepetition employee payroll deductions and withholdings;

C. prepetition employee and independent contractor business
     expenses, including travel, lodging, moving, closing costs
     and other relocation expenses;

D. prepetition contributions to and benefits under employee
     benefit plans; and

E. all costs and expenses incident to the foregoing payments and
     contributions.

According to Joseph Bonn, the Debtors' Executive Vice President,
the continued and uninterrupted service of the Employees and
Independent Contractors is essential to the Debtors' continuing
operations and their ability to reorganize. As of the Petition
Date, many of the Employees and Independent Contractors were
owed or had accrued various sums for Prepetition Compensation
and Prepetition Business Expenses. In addition, as of the
Petition Date, the Debtors had obligations in respect of
Prepetition Compensation for deductions from Employees'
paychecks used to make payments on behalf of the Employees for
or with respect to:

A. 401(k) savings programs, benefit plans, charitable
     contributions, credit unions, life insurance plans,
     garnishments or support payments and other similar programs
     on account of which the Debtors deduct a sum of money from
     an Employee's paycheck and pay that amount to a third
     party; and

B. withholdings from Employees' and certain Independent
     Contractors' paychecks on account of various federal, state
     and local income, FICA, Medicare and other taxes for
     remittance to the appropriate federal, state or local
     taxing authority.

The Debtors estimate that, as of the Petition Date,
approximately $6,950,000 in Prepetition Compensation,
approximately $350,000 in Prepetition Business Expenses, and
approximately $680,000 in Deductions had accrued but remained
unpaid. In addition, the Debtors estimate that the amount of
Withholdings attributable to compensation earned prior to the
Petition Date but not yet remitted to the applicable taxing
authority is approximately $1,850,000 in the aggregate.

As of the Petition Date, certain Benefits were owed but remained
unpaid because certain obligations under the Benefit Programs
accrued either in whole or in part prior to the Petition Date,
but will not become payable in the ordinary course of the
Debtors' businesses until a later date. The Benefits that the
Court grants the Debtors authority to pay include those owing
under the following types of Benefit Programs:

A. Self-Insured Programs: The Debtors maintain self-insured
     plans that provide medical, prescription drug, dental,
     vision and sickness and accident benefits. Based on the
     historical levels of claims, the Debtors estimate that, as
     of the Petition Date, approximately $13,000,000 in
     prepetition claims under the Self-Insured Plans will be
     submitted by Employees postpetition.

B. Third-Party Insured Programs: The Debtors also maintain
     certain insured benefit plans under which the Debtors, the
     Employees or both contribute to the payment of premiums for
     insurance or other coverage provided by third parties. The
     Insured Plans include comprehensive health care plans,
     group life insurance, long-term disability insurance, and
     additional life insurance. Based on the historical levels
     of premiums under the Insured Plans, the Debtors estimate
     that their accrued but unpaid share of premiums
     contributions, as of the Petition Date, was $1,140,000.

C. Company-Sponsored Benefit Programs: The Debtors also maintain
     certain other Benefit Programs under which the Debtors, the
     Employees or both contribute to the Benefits provided to
     the Employees. The Noninsured Programs include 401 (k)
     savings plans; a relocation program; health care spending
     accounts; dependent care spending accounts; incentive award
     programs and a tuition assistance program. Based on the
     historical levels of participation in the Noninsured
     Programs, the Debtors estimate that their accrued but
     unpaid obligation under the Noninsured Programs, as of the
     Petition Date, was approximately $3,062,000.

D. Programs Maintained By or On Behalf of Unions: Pursuant to
     the terms of its collective bargaining agreements with
     certain unions, the Debtors are also required to make
     contributions on behalf of union-represented employees to
     Benefit Programs maintained by or on behalf of certain
     unions. Based on the historical levels of participation in
     the Union Programs, the Debtors estimate that their accrued
     but unpaid obligation under the Union Programs, as of the
     Petition Date, was approximately $10,000.

Daniel J. DeFranceschi, Esq., at Richards Layton & Finger in
Wilmington, Delaware, explains that the Debtors seek the relief
requested in this Motion because any delay or disruption in the
provision of employee benefits or payment of compensation will
destroy the Debtors' relationships with the Employees and
Independent Contractors and irreparably impair workforce morale
at the very time when the dedication, confidence and cooperation
of these Employees and Independent Contractors is most critical.
The Debtors face the risk that their operations may be severely
impaired if authority is not granted immediately for the Debtors
to make the payments described above.

Mr. DeFranceschi adds that bolstering Employee and Independent
Contractor morale and ensuring the uninterrupted availability of
their services will assist the Debtors in maintaining a
"business as usual" atmosphere and, in turn, facilitate the
Debtors' efforts to emerge from chapter 11 without significant
delay. Finally, to remain in a position to maintain necessary
oversight and quality control and to enable many key Employees
and Independent Contractors to perform their jobs effectively,
the Debtors must continue their corporate policies of permitting
certain Employees and Independent Contractors to incur business-
related expenses and thereafter seek reimbursement by submitting
appropriate invoices or vouchers evidencing such out-of-pocket
disbursements.

Because the amounts represented by Prepetition Compensation,
Prepetition Business Expenses and Deductions are needed to
enable the Employees and Independent Contractors to meet their
own personal obligations, absent the relief requested herein,
Mr. DeFranceschi claims that the Employees and Independent
Contractors will suffer undue hardship and serious financial
difficulties. Without the requested relief, the stability of the
Debtors' businesses would be undermined by the potential threat
that otherwise loyal Employees at all levels, as well as
Independent Contractors, would seek other employment, and Sales
Agents would pursue the sale of competitors' products.

Moreover, Mr. DeFranceschi believes that in virtually all cases,
the amount of prepetition wages, salaries and contractual
compensation owing to or on account of any particular Employee
or Independent Contractor will not exceed the sum of $4,650
allowable as a priority claim. Nonetheless, to the extent that
the Debtors may owe an aggregate amount exceeding $4,650 in
combined Prepetition Compensation, Prepetition Business
Expenses, Deductions and Benefits to or on account of certain
Employees or Independent Contractors, the Debtors should be
permitted to pay those amounts for all of the critical business
reasons described above.

To avoid the serious disruption of the Debtors' reorganization
efforts that could result from the nonpayment of any withholding
taxes, the Debtors seek authority to remit all Withholdings,
including prepetition Withholdings collected on behalf of the
Employees and certain Independent Contractors, to the applicable
taxing authorities. Mr. DeFranceschi notes that many federal,
state and local taxing authorities impose personal liability on
the officers and directors of entities responsible for
collecting taxes from employees to the extent any such taxes are
collected but not remitted. Accordingly, if these amounts
remained unpaid, there is a risk that the Debtors' officers and
directors may be subject to lawsuits or even criminal
prosecution on account of any such nonpayment during the
pendency of these chapter 11 cases. Such lawsuits or proceedings
obviously would constitute a significant distraction for
officers and directors at a time when they should be focused on
the Debtors' efforts to stabilize their postpetition business
operations and develop and implement a successful reorganization
strategy.

In addition, the Court authorizes the Debtors to pay all costs
incident to Prepetition Compensation and Deductions, such as
processing costs and the employer portion of payroll-related
taxes, as well as accrued but unpaid prepetition charges for
administration of the Benefit Programs. The Debtors estimate
that the aggregate amount of Prepetition Processing Costs
accrued but unpaid, as of the Petition Date, was approximately
$570,000.  Mr. DeFranceschi explains that payment of the
Prepetition Processing Costs is justified because the failure to
pay any such amounts might disrupt services of third-party
providers with respect to Prepetition Compensation, Deductions
and Benefits. By paying the Prepetition Processing Costs, the
Debtors may avoid even temporary disruptions of such services
and thereby ensure that the Independent Contractors and
Employees obtain all compensation and Benefits without
interruption.

The Court further orders that all applicable banks and other
financial institutions be authorized and directed, when
requested by the Debtors, in the Debtors' sole discretion, to
receive, process, honor and pay any and all checks drawn on the
Debtors' accounts in respect of Prepetition Compensation,
Prepetition Business Expenses, Deductions, Withholdings,
Benefits and Prepetition Processing Costs, whether such checks
were presented prior to or after the Petition Date, provided
that sufficient funds are available in the applicable accounts
to make the payments. The Debtors represent that, with only a
single exception, these checks are drawn on identifiable payroll
and disbursement accounts and, in all cases, can be readily
identified as relating directly to the authorized payment of
Prepetition Compensation, Prepetition Business Expenses,
Deductions, Withholdings, Benefits or Prepetition Processing
Costs. Accordingly, the Debtors believe that checks other than
those relating to authorized payments will not be honored
inadvertently. The Debtors further represent that they have
sufficient cash reserves, together with anticipated access to
sufficient debtor in possession financing, to pay all
Prepetition Compensation, Prepetition Business Expenses,
Deductions, Withholdings, Benefits and Prepetition Processing
Costs, to the extent described herein, as such amounts become
due in the ordinary course of their businesses. (Kaiser
Bankruptcy News, Issue No. 2; Bankruptcy Creditors' Service,
Inc., 609/392-0900)   


KELLSTROM INDUSTRIES: Files for Chapter 11 Relief in Delaware
-------------------------------------------------------------
Kellstrom Industries, Inc., announced that it executed an Asset
Sale Agreement with KIAC Inc., an entity controlled by Inverness
Management LLC.

The Agreement calls for approximately a $50 million cash payment
by KIAC, which will be funded with equity from Inverness
Management LLC and a senior secured debt facility agented by GE
Capital, and additional cash consideration in the amount of $46
million resulting from the sale of certain other inventory over
a period of five years. The terms of the agreement call for
KIAC, subject to court approval, to acquire the ongoing business
of Kellstrom, as well as certain of its inventory and
receivables. KIAC indicated its intention to retain
substantially all of the employees of Kellstrom. In conjunction
with signing the Agreement, Kellstrom announced that it filed a
voluntary petition for relief under Chapter 11 of the Bankruptcy
Code in the United States Bankruptcy Court for the District of
Delaware.

The Company's senior lenders have agreed to provide Kellstrom
with a new $10 million credit facility ("DIP financing") to
finance the Company's working capital needs during the sale
approval process, which is expected to be completed in a few
months.

Inverness Management LLC is a privately held investment firm,
based in Greenwich, Connecticut, which provides equity for
acquisitions, recapitalizations and companies seeking additional
capital. Inverness invests primarily in out of favor industries
and has experience investing in the aviation services industry.
Inverness manages a private equity fund with over $180 million
of committed capital, provided primarily by large institutional
investors.

James C. Comis, III, Managing Director of Inverness, stated, "We
are confident that after consummation, Kellstrom's aviation
inventory management business will emerge as one of the most
strongly capitalized competitors in the industry. We believe
that the sound financial footing of the Company will enable its
customers and vendors to trade with us with confidence."

Yoav Stern, Chairman of the Board of Kellstrom stated, "We have
secured DIP financing to ensure the smooth continuity of our
operations. We expect that cash will be available to fund post-
petition obligations to vendors, employees and others in the
normal course of business. We expect the Agreement with KIAC and
Inverness to enable the Company to complete the Chapter 11
process in the shortest period of time, while maximizing value
for our constituencies, given present market conditions."

Zivi R. Nedivi, President and CEO added: "We cater to more than
1200 customers worldwide who have supported us during these
difficult times. I expect no disruption of business for our
customers and employees during the debtor-in-possession period.
These events enable us to continue supplying commercial and
defense inventory to accommodate our customer's needs. Our
market position and competitive edge will be enhanced by new
partners and enhanced financial strength."

Kellstrom is a leading aviation inventory management company.
Its principal business is the purchasing, overhauling (through
subcontractors), reselling and leasing of aircraft parts,
aircraft engines and engine parts. Headquartered in Miramar,
Florida, Kellstrom specializes in providing: engines and engine
parts for large turbo fan engines manufactured by CFM
International, General Electric, Pratt & Whitney and Rolls
Royce; aircraft parts and turbojet engines and engine parts for
large transport aircraft and helicopters; and aircraft
components including flight data recorders, electrical and
mechanical equipment and radar and navigation equipment.


KELLSTROM INDUSTRIES: Case Summary & 20 Largest Creditors
---------------------------------------------------------
Lead Debtor: Kellstrom Industries, Inc., a Delaware Corporation
             3701 Flamingo Road
             Miramar, FL 33027

Bankruptcy Case No.: 02-10536

Debtor affiliates filing separate chapter 11 petitions:

                  Entity                        Case No.
                  ------                        --------
     Kellstrom Commercial Aircraft, Inc.        02-10537
     Kellstrom Solair, Inc.                     02-10538
     Certified Aircraft Parts, Inc.             02-10540
     Aircraft 21801, Inc.                       02-10541
     Aircraft 21805, Inc.                       02-10542
     DC-9 Aircraft Holdings, L.L.C.             02-10543
     DC-9 Aircraft Holdings II, L.L.C.          02-10544
  
Type of Business: Kellstrom is a Leader in the Aviation
                  Inventory Management Industry and its
                  Principal Business is the Purchasing,
                  Overhauling (Through Subcontractors),
                  Reselling and leasing of Aircraft Parts,
                  Aircraft Engines and Parts.   

Chapter 11 Petition Date: February 20, 2002

Court: District of Delaware

Judge: Mary F. Walrath

Debtors' Counsel: Domenic E. Pacitti, Esq.
                  Saul Ewing LLP
                  222 Delaware Ave.
                  Wilmington, DE 19899
                  (302) 421-6800
                  Fax: (302) 421-6813

Total Assets: $371,249,106

Total Debts: $402,400,477

Debtor's 20 Largest Unsecured Creditors:

Entity                      Nature Of Claim       Claim Amount
------                      ---------------       ------------
HSBC Bank USA               5.5% Convertible      $86,250,000
Issuer Services Dept.       Subordinated Notes
452 East Fifth Avenue       Due 6/2003
New York, NY 10018-2706
Tel: 212-525-1324
Fax: 212-525-1366

HSBC Bank USA               5.75% Convertible     $54,000,000  
Issuer Service Dept.        Subordinated Notes
452 East Fifth Avenue       Due 10/2002
New York, NY 10018-2706
Tel: 212-525-1324
Fax: 212-525-1366

Key Mezzanine Capital       13% Senior Subor-     $30,000,000
Mgmt. Co. LLC              dinated Notes Due
Three Embarcadero Center    11/13/07
Suite 2900
San Francisco, CA 94111
Tel: 415-733-3395
Fax: 415-733-2466

Kav Inventory, LLC          Trade Vendor          $2,088,308.28
Bank of America
Commercial Finance
GA 1-006-0514
600 Peachtree Street 5th
Floor
Atlanta, GA 30308
Tel: 404-607-5365
Fax: 404-607-6642

Don A. Sanders              Note Payable          $2,000,000
3100 Chase Tower
600 Travis
Houston, TX 77002
Tel: 713-224-3100
Fax: 713-224-1101

James Ventures, LP          Note Payable          $2,000,000
5301 Hollister
Suite 300
Houston, TX 77040
Tel: 713-934-1145
Fax: 713-934-1150

LJH Corporation             Note Payable          $2,000,000
377 Neva Lane
Dennison, TX 75020-4869
Tel: 214-695-0904
Fax: 903-465-6514

Mr. Robert Belfer           Note Payable          $2,000,000  
C/o Belco Oil & Gas Corp.
767 5th Ave., 46th Floor
New York, NY 10153
Attention: Robert Belfer
Tel: 212-644-2259
Fax: 212-644-2396

Deutsche Bank Alex Brown    Contract              $1,847,958
130 Liberty Street
MS 2331
New York, NY 10006
Attn: John R. Zacamy, Jr.
Tel: 212-250-6168
Fax: 212-669-0706

GE A/C Engine Services LTD  Trade Vendor          $997,283.49
Caerphilly Road
Cardiff, Nantgarw CF 7YJ
Great Britain
Attn: Mr. Guto Davies
Tel: 01 443871041
Fax: 01 443847362

Pratt & Whitney             Trade Vendor          $941,843.88
400 Main Street
M/S 133-64
East Hartford, CT 06108
Attn: Sherry Baine
Tel: 860-565-9691
Fax: 860-565-7806

Aviation Sales Company      Trade Vendor          $869,470.87
623 Radar Road
Greensboro, NC 27410
Attn: Anthony Borzillo
Tel: 336-668-8010
Fax: 336-662-8045

PS Group Holdings           Trade Vendor          $653,442.36
7915 Silverton Avenue
Suite 301
San Diego, CA 92126
Attn: Lawrence Guski
Tel: 858-271-9603
Fax: 858-642-1955

Turbine Metal Technology    Note Payable          $536,535.53
Inc.
105 Timbers Blvd.
Smith River, CA 95567
Attn: Gary Castlan
Tel: 707-487-0307
Fax: 707-487-2025

Boeing Commercial           Trade Vendor          $507,924.79
Airplanes
Building 10-18
635 Park Avenue North
Renton, WA 98055
Attn: Aniela Whisler
Tel: 425-237-4619
Fax: 425-237-3830

PT Dian Semestra Prakasa    Trade Vendor          $425,000
Jalng Kemang
Timur 16
Jakarta 12370 Indonesia
Attn: Sumardi Yanto,
Director
Tel: 62-21-7199621
Fax: 62-21-7199623

Aviation Holdings Int'l     Trade Vendor          $419,925
Inc
15675 NW 15th Ave
Miami, FL 33169
Attn: Joseph Nelson
Tel: 305-624-6700
Fax: 305-624-2944

Rolls Royce Corp            Trade Vendor          $390,000
PO Box 420 R39
Indianapolis, IN 46206-0420
Attn: Terry P. Kirst
Tel: 317-230-5805
Fax: 317-230-5760

Evergreen Aircraft          Trade Payable         $367,515.95
Sales & Leasing Co
3850 Three Mile Lane
McMinnville, OR 97128-9496
Attn: John Irwin, VP Finance
Tel: 503-472-0011
Fax: 503-434-6484

AAR Landing Gear            Trade Vendor          $341,621.19
C/o AAR Corp.
One AAR Place
1100 Wood Dale Road
Wood Dale, IL 60191
Attn: Bob Daly, Sr. VP
Finance
Tel: 630227-2380
Fax: 630-227-2359


KITTY HAWK: Hearing on Disclosure Statement Scheduled for Mar. 6
----------------------------------------------------------------
Kitty Hawk, Inc. (OTC Pink Sheets: KTTEQ) announced that it and
its subsidiaries have filed an Amended Joint Plan of
Reorganization dated February 5, 2002, and the accompanying
Disclosure Statement in Support of the Debtors' Amended Joint
Plan of Reorganization with the United States Bankruptcy Court
for the Northern District of Texas, Fort Worth Division in
connection with their pending Chapter 11 reorganization
proceedings under the United States Bankruptcy Code.

The company's proposed plan of reorganization provides for the
distribution of all the capital stock of the reorganized company
to Kitty Hawk's creditors, accompanied by the simultaneous
cancellation of all Kitty Hawk capital stock issued prior to the
Chapter 11 filing.  Kitty Hawk must obtain the approval of the
Bankruptcy Court before the reorganization plan can be
implemented.

A hearing on the adequacy of the Disclosure Statement has been
set for March 6, 2002, at 3:15 p.m. in the United States
Bankruptcy Court, 501 West 10th Street, Courtroom No. 128, Fort
Worth, Texas.  Any objections to the Disclosure Statement must
be received by debtors' counsel, Haynes and Boone, LLP, 201 Main
Street, Suite 2200, Fort Worth, Texas 76102, Attention: John D.
Penn on or before March 4, 2002.

As an alternative to the recently filed Amended Joint Plan of
Reorganization, Kitty Hawk is also examining the possibility of
an amendment to the plan to accommodate third-party investment.  
While Kitty Hawk has engaged in preliminary discussions with
several parties, no transaction terms have been reached, and
there can be no assurance that the pending discussions will
eventually lead to the consummation of a transaction.

Tilmon J. Reeves, Kitty Hawk's Chairman and Chief Executive
Officer, commented, "The filing of our reorganization plan is a
significant accomplishment.  While we continue to evaluate all
reorganization alternatives, including a potential plan
amendment to provide for a third-party investment, we presently
believe that our current plan of reorganization is the most
feasible way for Kitty Hawk to emerge from Chapter 11."


KMART CORP: U.S. Trustee Appoints Unsecured Creditors' Committee
----------------------------------------------------------------
Ira Bodenstein, United States Trustee for Region 11, appoints
these 13 unsecured claimants to the Official Committee of
Unsecured Creditors for Kmart Corp.'s chapter 11 cases:

               Fuji Photo Film U.S.A., Inc.
               555 Texter Road
               Elmsford, New York 10523
               Attn: Martin Barash

               American Greetings
               One American Road
               Cleveland, Ohio 44144-2398
               Attn: Art Tuttle

               Bridgeford Foods of Illinois
               170 North Green Street
               Chicago, Illinois 60607
               Attn: Richard G. Klaczynski

               20th Century Fox Home Entertainment
               Legal Department
               PO Box 900
               Beverly Hills, California 90213-0900
               Attn: UnJu Paik

               GMAC Commercial Credit
               1290 Avenue of Americas
               New York, New York 10104
               Attn: Esther D. Miller

               Newell Rubbermaid
               29 East Stephenson Street
               Freeport, Illinois 61032
               Attn: Mark Rapp

               Kimco Realty Corporation
               3333 New Hyde Park Road
               Suite 100
               New Hyde Park, New York 11042
               Attn: Milton Cooper

               Sara Lee Corporation
               475 Corporate Square Drive
               Winston-Salem, North Carolina 27105
               Attn: David S. Peoples

               PepsiCo
               3501 Algonquin Road
               Rolling Meadows, Illinois 60008
               Attn: Scott Nehs

               Nintendo of America, Inc.
               4820 150th Avenue N.E.
               Redmond, Washington 98052
               Attn: Elizabeth M. Aurelio

               Buena Vista Home Video
               500 South Buena Vista Street
               Burbank, California 91521-9750
               Attn: Kenneth E. Newman

               Mattel, Inc.
               333 Continental Boulevard
               El Segundo, California 90245
               Attn: Kathleen Simpson-Taylor

               Pension Benefit Guaranty Corporation
               1200 K Street, N.W.
               Washington, D.C. 20005-4026
               Attn: James J. Keightley

Kathryn Gleason, Esq., is the trial attorney for the U.S.
Trustee's office assigned to Kmart's chapter 11 cases.

At its first meeting, the Committee voted to retain Otterbourg,
Steindler, Houston & Rosen, P.C., as its legal counsel and KPMG
LLP as its accountants. (Kmart Bankruptcy News, Issue No. 4;
Bankruptcy Creditors' Service, Inc., 609/392-0900)   


MAJOR AUTOMOTIVE: Violates Nasdaq Continued Listing Requirements
----------------------------------------------------------------
The Major Automotive Companies, Inc. (f/k/a Fidelity Holdings,
Inc.) (Nasdaq NM: MAJR - news) announced that the Company has
received a Notification of Deficiency from Nasdaq indicating
that the Company is not in compliance with Nasdaq Marketplace
Rules 4450(a)(2) and 4450(a)(5) relating to minimum market value
of publicly held shares ($5 million) and minimum bid price per
share ($1.00) that are required for continued listing on the
Nasdaq National Market.

The Company has until May 15, 2002 to demonstrate compliance
with these rules or face delisting. Alternatively, the Company
may apply to transfer its securities to the Nasdaq SmallCap
Market, which, if such application is accepted, will grant the
Company an extended grace period, until August 13, 2002 to
demonstrate compliance with the $1.00 minimum bid requirement.

The Company is evaluating all alternatives.

The Major Automotive Companies is a leading consolidator of
automotive dealerships in the New York Metropolitan area. For
additional information, visit the Company's Web site at
http://www.majorauto.com/


MCLEODUSA INC: Asks Court to Establish January 30 Record Date
-------------------------------------------------------------
McLeodUSA Inc., asks the Court to fix January 30, 2002, the day
before the Petition Date, as the record date for the purpose of
determining which members of Classes 5 and 6 are entitled to
receive a Solicitation Package and to vote on the Plan.
(McLeodUSA Bankruptcy News, Issue No. 3; Bankruptcy Creditors'
Service, Inc., 609/392-0900)  


METRETEK TECHNOLOGIES: Falls Short of Nasdaq Listing Standards
--------------------------------------------------------------
Metretek Technologies, Inc. (Nasdaq:MTEK), announced that on
February 14, 2002 it received a letter from The Nasdaq Stock
Market indicating that Metretek is not in compliance with two
Nasdaq National Market continued listing requirements relating
to its common stock -- the $5,000,000 minimum market value of
publicly held shares requirement set forth in Marketplace Rule
4450(a)(2), and the $1.00 minimum bid price per share
requirement set forth in Marketplace Rule 4450(a)(5).

Under Marketplace Rules 4450(e)(1) and 4450(e)(2), Metretek will
be provided 90 calendar days, or until May 15, 2002, to regain
compliance with these requirements for 10 consecutive trading
days. If Metretek cannot demonstrate compliance within this
timeframe, its common stock will be subject to delisting from
the Nasdaq National Market. At that time, Metretek can either
appeal the delisting determination to the Nasdaq Listing
Qualifications Panel or apply to transfer its common stock to
The Nasdaq SmallCap Market.

If Metretek decides to transfer its common stock to the SmallCap
Market, it must satisfy the continued inclusion requirements for
that market, including the requirements of $1,000,000 minimum
market value of publicly held shares and $1.00 minimum bid price
per share. Under new Nasdaq rules, Metretek would be afforded
additional SmallCap Market grace periods for deficiencies in the
minimum $1.00 bid price requirement and could return to the
National Market if it demonstrates compliance with the $1.00 bid
price requirement for 30 consecutive trading days prior to the
expiration of all SmallCap Market grace periods and complies
with all other National Market maintenance requirements
throughout its SmallCap Market listing period.

Metretek Technologies, Inc. through its subsidiaries --
PowerSecure, Inc.; Metretek, Incorporated; and Southern Flow
Companies, Inc. -- is a diversified provider of energy
technology products, services and data management systems to
industrial and commercial users and suppliers of natural gas and
electricity.


ONI SYSTEMS: Acquisition by Ciena Corp. Spurs S&P Watch Actions
---------------------------------------------------------------
Standard & Poor's said that it placed its single-'B'-minus
corporate credit and triple-'C' subordinated debt ratings on San
Jose, California-based ONI Systems Inc., on CreditWatch with
positive implications, after Linthicum, Maryland-based Ciena
Corp., announced a definitive agreement to acquire ONI for about
$900 million in stock. The transaction is expected to close by
the third quarter of 2002.

At the same time Standard & Poor's affirmed Ciena's single-'B'-
plus corporate credit and senior note ratings. Ciena will issue
stock to ONI shareholders valued at about $900 million, based on
the closing price of Ciena stock on Feb. 15, 2002. In addition,
Ciena will assume ONI's outstanding $300 million in subordinated
convertible notes.

Ciena, the nation's second-largest producer of fiber-optic
networking equipment, expects the purchase of ONI Systems to
boost sales of optical networking devices used in metropolitan
telephone networks. Ciena and ONI have each been expecting
operating losses and negative operating cash flows over the
intermediate term, because of depressed market conditions. The
combined company will have about $1.3 billion of cash and
marketable securities net of debt, as of January 2002 figures.

"Ciena's ratings continue to reflect the company's narrow
business position, substantial technology risks and narrow
customer base, offset by its still-good financial flexibility,"
said Standard & Poor's credit analyst Emile Courtney. Upon
completion of the merger, ONI's subordinated debt will be raised
to Ciena's subordinated debt level.


OPTICARE HEALTH: Palisade Takes-Over 81.8% Controlling Stake
------------------------------------------------------------
On January 25, 2002, OptiCare Health Systems, Inc., a Delaware
corporation, consummated a series of transactions which resulted
in a change in control of the Company and a major restructuring
of its debt, equity and voting capital stock.

Pursuant to a Restructure Agreement among the Company, Palisade
Concentrated Equity Partnership, L.P., and Dean J. Yimoyines,
M.D. (the Chairman of the Board of Directors, President, and
Chief Executive Officer of the Company), dated December 17,
2001, as amended on January 5, 2002 and January 22, 2002,
Palisade purchased 2,571,429 shares of the Company's Series B
12.5% Voting Cumulative Convertible Participating Preferred
Stock, par value $.001 per share, convertible into 25,714,290
shares of common stock, for an aggregate cash purchase price of
$3.6 million. Palisade also received an additional 309,170.5
shares of the Company's Series B Preferred Stock, convertible
into 3,091,705 shares of common stock, as payment for the
outstanding balance (including accrued interest) of Palisade's
participation in a bridge loan to the Company, which principal
and interest aggregated $432,838.70 at the time of such issuance
and sale. Each share of Series B Preferred Stock is immediately
convertible into ten shares of common stock and has the voting
power equivalent to the number of shares of common stock into
which each share of Series B Preferred Stock may be converted.
In addition, pursuant to the Restructure Agreement, in
connection with providing a $13.9 million subordinated loan to
the Company, Palisade received warrants entitling Palisade, at
any time, to purchase up to 17,375,000 additional shares of
common stock at an exercise price of $.14 per share. All funds
used to make the loan and the purchase of the Series B Preferred
Stock came directly from the assets of Palisade.

As of the closing of the transactions, there were 59,396,087
shares of common stock outstanding on a diluted basis (including
12,815,092 shares of common stock outstanding as of January 25,
2002 and 28,805,995 shares of common stock issuable upon
conversion of the Series B Preferred Stock held by Palisade and
exercise of the warrants held by Palisade). As of the closing,
Palisade held (i) 2,000,000 shares of the common stock which
were previously acquired, (ii) 2,880,599.5 shares of Series B
Preferred Stock, immediately convertible into 28,805,995 shares
of common stock, (iii) immediately exercisable warrants to
purchase up to an additional 17,375,000 shares of common stock,
and (iv) immediately exerciseable warrants to purchase 400,000
shares, previously acquired. Without giving effect to the
warrants, Palisade may be deemed to beneficially own 74.0% of
the common stock. Giving effect to the warrants held by
Palisade, Palisade may be deemed to beneficially own 81.8%. The
Series B Preferred Stock and the warrants are subject to
adjustment for stock splits, stock dividends and similar
transactions and certain anti-dilution protections.

Pursuant to the terms of the Restructure Agreement, the Company
has agreed that so long as Palisade owns more than 50% of the
voting power of the Company, Palisade shall have the right to
designate a majority of the Board of Directors. On January 25,
2002, Messrs. Raymond W. Brennan and Alan J. Glazer, each of
whom had become a director of the Company effective as of
November 1, 2001, resigned as directors, and the following
persons, designated by Palisade, were elected to the Board of
Directors: Mel Meskin, Mark Hoffman, and Eric J. Bertrand.

Dr. Yimoyines and Messrs. Norman Drubner and Frederick Rice
continue to be directors of the Company. Palisade has advised
the Company that it expects to designate one or more additional
members of the Board of Directors, so that the members
designated by Palisade will constitute a majority of the Board
of Directors, as contemplated by the Restructure Agreement.
Under the Restructure Agreement, Dr. Yimoyines also agreed to
lend funds to the Company, purchase Series B Preferred Stock,
and settle his participation in an outstanding loan to the
Company in exchange for Series B Preferred Stock, on the same
terms and conditions (except as to amounts) as Palisade's loan,
purchase of Series B Preferred Stock and settlement of an
outstanding loan participation.

OptiCare Health Systems, Inc. is an integrated eye care services
company focused on managed care and professional eye care
services. It also provides systems, including internet-based
software solutions, to eye care professionals.


PACIFIC AEROSPACE: Enters Agreement to Restructure Debt & Equity
----------------------------------------------------------------
On January 11, 2002, Pacific Aerospace & Electronics Inc. and
holders of approximately 98% of the outstanding 11-1/4% senior
subordinated notes due 2005  have agreed to enter into a
restructuring of the Company's debt and equity. The Company and
the Participating Noteholders have agreed that the Participating
Noteholders will exchange their outstanding Old Notes, including
accrued interest, for a combination of common stock, convertible
preferred stock and new notes.

The Exchange will be consummated pursuant to an exchange
agreement whereby the Participating Noteholders will exchange
approximately $62.5 million aggregate principal amount of Old
Notes and accrued interest thereon, for:

     (i) shares of common stock of the Company in an amount
sufficient to give the Participating Noteholders in the
aggregate a majority of the outstanding common stock of the
Company;

    (ii) 1,000 shares of convertible preferred stock of the
Company, which will be automatically convertible, upon an
increase in the Company's authorized common stock, into that
number of shares of common stock which, when added to the common
stock issued in the Exchange, will be sufficient to give the
Participating Noteholders beneficial ownership of 97.5% of the
Company's outstanding common stock on a fully diluted basis; and

   (iii) $15 million in aggregate principal amount of the PIK
Notes.

PIK Notes having an aggregate principal amount of $15 million
will be issued pursuant to the Exchange. The Exchange is
conditioned upon all of the Old Notes being exchanged, although
the holders of 95% of the Old Notes reserve the right to waive
this requirement. To the extent that any Old Notes remain
outstanding following the Exchange, they will rank pari passu to
the PIK Notes with respect to seniority.

As the PIK Notes are proposed to be offered for exchange by the
Company with its existing Noteholders exclusively and for
outstanding securities of the Company as set forth above, the
Exchange is exempt from registration under the Securities Act,
pursuant to the provisions of Section 3(a)(9) thereof. There
will not be any sales of securities of the same class as the PIK
Notes (other than sales pursuant to the Exchange) by the Company
or by or through an underwriter at or about the same time as the
transaction for which the exemption is claimed. No consideration
has been or is to be given, directly or indirectly, to any
broker, dealer, salesman, or other person for soliciting
exchanges of the Old Notes. The Company has agreed to pay
remuneration to its financial, legal and accounting advisors for
the provision of advisory, legal and accounting services,
respectively. No Participating Noteholder has made or will be
requested to make any cash payment to the Company in connection
with the Exchange; provided, however, that the Company and an
affiliate of a holder of Old Notes anticipate entering into a
Senior Loan transaction at or about the same time as the date of
the Exchange.


PAXSON COMMS: Completes Refinancing of 12.5% Preferred Stock
------------------------------------------------------------
Paxson Communications Corporation (AMEX:PAX), the owner and
operator of the nation's largest broadcast television station
group and the PAX TV network reaching 85% of U.S. households,
today reported its financial results for the three months and
the year ended December 31, 2001.

Financial Highlights:

     -- The Company had EBITDA of positive $7.0 million in the
fourth quarter of 2001.

     -- EBITDA improved $23.0 million for the year, from
negative $4.9 million in 2000 to positive $18.1 million in 2001.

     -- Revenues for the year remained relatively flat with only
a 2% decrease compared to the prior year in a weak advertising
market.

     -- Cash operating expenses for broadcast operations and
SG&A decreased 10% for the quarter compared to the fourth
quarter of 2000.

     -- In January 2002, the Company successfully refinanced its
12.5% preferred stock with new senior subordinated discount
notes completing a step in further solidifying its capital
structure. The Company has no securities maturing before 2006.

Operating Highlights:

     -- Local spot is pacing up almost 20% in the first quarter
of 2002 as JSAs start to gain momentum.

     -- PAX TV 2001 full year ratings were up 9% in households
and 19% and 18%, respectively, in the key demos Adults 18-49 and
Adults 25-54.

     -- PAX TV hit shows "Doc" and "The Ponderosa" continue to
lead the network, registering season-to-date ratings increases
in total viewers of nearly 80% and over 50%, respectively, over
the year ago time period.

Gross revenues for the fourth quarter were $77.1 million, a
decrease of 10% compared with the quarter ended December 31,
2000. Gross revenues for the year ended December 31, 2001 were
$308.8 million, a decrease of 2.3% over the prior year. The
Company's relatively flat revenues for the twelve-month period
primarily reflect the strength of the PAX TV network despite
softness in television station broadcast revenues during such
period. The net loss attributable to common stockholders for the
quarter was $71.3 million compared to a net loss of $154.8
million last year. The net loss attributable to common
stockholders for the year ended December 31, 2001 was $350.4
million compared to $391.3 million for the prior year.

The Company's EBITDA remained relatively flat at $7.0 million
for the quarter ended December 31, 2001. The Company's EBITDA
improved to $18.1 million for the year ended December 31, 2001,
a $23.0 million increase from the prior year. The Company's
EBITDA growth for the twelve-month period resulted from cost
cutting measures in all areas of the Company's operations in
response to the ongoing recession in the advertising
marketplace. Paxson President and CEO Jeff Sagansky commented,
"Over the last seven months, we have completed refinancings of
over $850 million in our capital structure. We have reduced our
cost of this capital by 300 basis points and we now have a solid
capital structure with no maturing securities until 2006. On the
operations side, our local spot revenue is pacing ahead 20% in
the first quarter, which is a strong indication that our JSAs
are gaining the momentum we anticipated. We are also seeing our
long-form revenue regain the strength that we enjoyed during the
first half of 2001."

Commenting on the outlook for the first quarter, Paxson Chief
Financial Officer Tom Severson said, "We currently expect our
revenues for the first quarter of 2002 to be relatively flat
compared to the first quarter of 2001. The first quarter
momentum of our network long form revenue and local television
spot revenue is offsetting the weakness of the 2001-2002 upfront
marketplace which relates to our network spot revenue. We expect
our first quarter EBITDA to be in the positive $5 to $9 million
range. If we achieve the mid-point of our guidance, the result
will be an EBITDA improvement of over 100% over last year's
first quarter EBITDA of $3.3 million. We are not giving full
year 2002 guidance at this time, however, we are well positioned
to grow our EBITDA and revenue in 2002 and we are committed to
keeping our operating expenses at or below the levels
experienced in 2001."

Balance Sheet Analysis:

The Company's cash and short-term investments increased during
the fourth quarter by $36.0 million to $96.0 million as of
December 31, 2001. The quarter's increase in cash and short-term
investments primarily resulted from proceeds from the sale of
the Company's tower assets and borrowings under the Company's
bank credit facility. The Company's total debt increased $33.6
million during the quarter to $529.2 million as of December 31,
2001. The increase in total debt resulted from borrowings under
the Company's bank credit facility, a substantial portion of
which was used to finance the continuing digital build out
required by the Federal Communications Commission. As of
December 31, 2001, the Company had $30.0 million in available
capacity for future capital expenditures under its bank credit
facility. In January 2002, the Company refinanced its existing
12.5% preferred stock with $308 million of 12-1/4% senior
subordinated discount notes. The refinancing allowed the company
to remove its obligation to make $40 million of annual cash
dividend payments to the holders of the 12.5% preferred stock
beginning in 2003.

Paxson Communications Corporation owns and operates the nation's
largest broadcast television station group and PAX TV, the
family friendly broadcast television network that launched in
August of 1998. PAX TV reaches 85% of U.S. television households
via nationwide broadcast television, cable and satellite
distribution systems. Paxson owns and operates 65 stations
(including three stations operated under time brokerage
agreements). PAX airs its own original programming including
"It's A Miracle," "Mysterious Ways," "Encounters with the
Unexplained" and "Doc," starring recording artist Billy Ray
Cyrus. PAX TV's new season lineup includes the original series
"The Ponderosa," "Ed McMahon's Next Big Star" and "Candid
Camera." For more information, visit PAX TV's Web site at
http://www.pax.tv


PSINET INC: Bar Date Moved to March 7 for Xpedior Proof of Claim
----------------------------------------------------------------
Upon the Stipulation and Agreement by PSINet, Inc., and the
Official Committee of Unsecured Creditors of Xpedior
Incorporated and its affiliates, the Court so ordered that,
notwithstanding the General Bar Date of February 5, 2002, the
Xpedior Committee may file a Proof of Claim on behalf of
Xpedior's bankruptcy estates, against a Debtor in the PSINet
Chapter 11 cases, so as to be received no later than 4:00 pm.
prevailing eastern time, on March 7, 2002. (PSINet Bankruptcy
News, Issue No. 14; Bankruptcy Creditors' Service, Inc.,
609/392-0900)   


QUESTRON TECHNOLOGY: Nasdaq Delists Securities Effective Feb. 19
----------------------------------------------------------------
Questron Technology, Inc., announced that it has been notified
that the Company's securities will be delisted from the Nasdaq
Stock Market effective with the opening of business on February
19, 2002. Trading in the Company's securities on the Nasdaq
Stock Market has been suspended since the Company announced its
bankruptcy filing on February 4, 2002.

The Company has been informed that trading in the Company's
securities may occur in the "pink sheets" published by National
Quotation Bureau LLC. The Company strongly encourages anyone
contemplating purchasing its securities to proceed cautiously
and only after a careful review of publicly available
information. The Company has filed a Current Report on Form 8-K
with the United States Securities and Exchange Commission, dated
February 7, 2002, which provides information with respect to the
Company's bankruptcy filing and the proposed sale of
substantially all of the Company's assets. The Company believes
that the purchase price payable in the proposed sale transaction
will be insufficient to cover all of the Company's liabilities
and, therefore, the Company's stockholders will not receive any
distribution upon completion of the bankruptcy proceedings.

Questron Technology Inc. is a leading provider of supply chain
management solutions and professional inventory logistics
management programs for small parts commonly referred to as "C"
inventory items (fasteners and related products) focused on the
needs of Original Equipment Manufacturers (OEMs). More
information about the company can be found in its filings with
the Securities and Exchange Commission or by visiting
http://www.questrontechnology.com


RCN CORP: Moody's Junks Debt Ratings Over Credit Loss Revisions
---------------------------------------------------------------
Moody's Investors Service junks the debt ratings of RCN
Corporation and concludes the review of the company it started
on September, 27, 2001. The ratings lowere are:

                                        To        From
     *$250 million guaranteed senior
      secured revolver due 2006 -       Caa1      B2

     *$250 million guaranteed senior
      secured term loan A due 2006 -    Caa1      B2

     *$500 million guaranteed senior
      secured term loan B due 2007 -    Caa1      B2

     *$161 million (remaining amount
      of original $225 million issuance)
      of 10% senior notes due 2007 -    Ca        Caa2

     *$232 million (remaining amount
      of original $375 million issuance)
      of 10.125% senior notes due 2010 - Ca       Caa2

     *$356 million (remaining amount
      of original $567 million face
      value at issuance) of 9.80% senior
      discount notes due 2008 -          Ca       Caa2

     *$145 million (remaining amount
      of original $256.76 million face
      value at issuance) of 11.00% senior
      discount notes due 2008 -          Ca       Caa2

     *$292 million (remaining amount
      of original $601.05 million face
      value at issuance) of 11.125% senior
      discount notes due 2007 -          Ca       Caa2

     *Senior implied rating -            Caa2     B3

     *Senior unsecured issuer rating -   Ca       Caa2

Outlook is negative.  

"The downgrades stem mainly from upward revisions of expected
credit loss that are likely to be realized by the company's
creditors upon ultimate recovery under an anticipated default
scenario perhaps as early as later this year but almost
certainly by 2004 at the back end of our rating horizon.
Specifically, we note our view that the negative medium-term
impact of recent debt tendering activities at distressed prices
with pre-funded excess cash balances originally intended to
support asset deployment and business growth will outstrip the
near-term benefits of reduced debt service costs and a lower
absolute debt burden, and may well accelerate the seemingly
inevitable debt restructuring and/or liquidation of the
company," Moody's explains.

Outlook may be upgraded to stable if management can negotiate
more time from their bank creditors and generate cashflow growth
for the company thereby raising its possibility of servicing its
debt burden by 2004. However, outlook may further downgrade if
these measures cannot be complied with.

"As previously outlined, we remain concerned about management's
ability to grow the company's asset base to levels sufficient to
adequately support the company's obligations, notwithstanding
the material reduction on an absolute basis that has been
affected via heavily discounted debt repurchases over the last
year. The large liquidity position that RCN still maintains at
present (currently $834 million in cash and $250 million of
availability under its still undrawn revolving credit facility)
continues to represent one of the company's best assets,
particularly given our expectation that ongoing negative free
cash flow generation will keep the company a net borrower for
some time," Moody's further notes.

Several cost reductions schemes have been made by the company
over the past year, however they may soon be in violation of its
financial maintenance covenants within the bank credit agreement
by the second half of the present year. RCN is currently
discussing with its bank groups for possible relief in its
covenants. However, Moody's foresees that the resolution may
well result to further diminished financial flexibility leading
to a forced restructuring.

There are further questions if the company's assets are enough
in the liquidation scenario. "While certain more extraneous
assets do exist that could potentially be monetized, even a
fairly liberal valuation of those and other remaining properties
reveal a considerable shortfall relative to the absolute size of
RCN's obligations, thus leading us to the conclusion that there
is the potential for moderate loss of principal may be realized
by senior secured debt holders and severe losses are to be
expected for senior unsecured noteholders," Moody's explains.

RCN Corporation is a communications company that is constructing
network and marketing video, voice and data services mainly to
residential households located in high-density northeast, west
coast and Midwest markets in competition with leading incumbent
service providers. The company maintains its headquarters in
Princeton, NJ.


REGAL CINEMAS: Enters Deal to Keep 6 IMAX Theatres in Operation
---------------------------------------------------------------
IMAX Corporation (Nasdaq: IMAX; TSE: IMX) announced that it had
completed an agreement with Regal Cinemas to keep Regal's six
IMAX(R) theatres open and operating.  Regal will make a lump-sum
payment which is subject to Bankruptcy Court approval, to IMAX
in satisfaction of all outstanding claims between the two
parties.  As part of Regal's restructuring process, the company
was acquired by a consortium led by Philip Anschutz, also owner
of United Artists and Edwards Theater chains.

"We are extremely happy to strike a deal with Regal, one of our
most important clients," said IMAX co-CEOs Richard L. Gelfond
and Bradley J. Wechsler.  "This agreement will keep Regal's six
IMAX theatres open and will allow them to benefit from the 2002
film slate which is the strongest in our history. We are looking
forward to growing our relationship with Regal."

"We are pleased to complete arrangements which allow us to
continue operations at our six IMAX theatres," said Regal's
Chief Executive Officer Michael Campbell. "We look forward to
what looks to be a strong film slate for our IMAX theatres in
2002."

Founded in 1967, IMAX Corporation is one of the world's leading
entertainment technology companies.  IMAX's businesses include
the world's best cinematic presentations together with IMAX,
IMAX 3D and the development of the highest quality digital
production and presentation.  The IMAX brand is recognized
throughout the world for extraordinary and immersive family
experiences. As of September 2001, there were more than 220 IMAX
theatres operating in 30 countries. More than 700 million people
have seen an IMAX presentation since the medium premiered in
1970.   IMAX Corporation is a publicly traded company listed on
both the Toronto and Nasdaq stock exchanges. IMAX(R) is a
registered trademark of IMAX Corporation. More information on
the Company can be found at http://www.imax.com


SERVICE MERCHANDISE: Court OKs Wind-Down Employee Retention Pact
----------------------------------------------------------------
Judge Paine approves Service Merchandise Company, Inc., and its
debtor-affiliates' Wind-down Employee Retention Program provided
that:

  (a) Sam Cusano shall no longer serve as Chief Executive
      Officer effective as of February 1, 2002, but shall remain
      as non-executive chairman of the Board of Directors of the
      Debtors. Mr. Cusano shall continue to assist the Debtors
      on a non-exclusive, as needed basis until the earlier of
      May 3, 2002 or the completion of the final reconciliation
      of the Going Out of Business Sales under the Agency
      Agreement. During such time, Mr. Cusano shall continue to
      be compensated at his base salary rate, but shall not
      otherwise participate under the Wind-Down Retention
      Program. By February 1, 2002, Mr. Cusano shall be fully
      vested, and is hereby entitled to receive, all severance
      payments and any other benefits due under his existing
      employment agreement, and reimbursement of all employment
      related legal expenses without further notice or action;

  (b) Only those approximately 7 employees whose services are
      currently expected to be required beyond May 1, 2002 and
      who have been identified or will be identified to the
      Committee are eligible to participate in the Retention
      Program Plan. Subject to vesting as described in the
      Motion, payments under the Retention Payment Plan shall be
      as follows:

      -- 40% of the base salary for Steve Moore;

      -- 35% of base salary of Jeff Heavrin, Pat Shiver, Carrol
         Combs and Lane Scoggin; and

      -- 25% of base salary for Doris Meador, Michael Reese,
         Victoria Harvey and Bethany Malakalis.

      Payments under the Retention Payment Plan are estimated to
      be $320,000 assuming all such employees remain employed
      through their respective targeted termination dates.
      Notwithstanding the foregoing, to the extent that the
      services of Michael Hogrefe are necessary beyond May 31,
      2002, Mr. Hogrefe shall be entitled to participate in the
      Retention Payment Plan at an enhanced base salary rate of
      35% effective retroactively to January 18, 2002;

  (c) The amount of the Discretionary Bonus Pool shall be
      limited to $180,000 plus the aggregate amount of any
      bonuses forgone by any employee eligible to participate
      under the Retention Payment Plan prior to vesting. Payment
      shall be awarded either by Mr. Cusano or the then active
      Chief Officer for administering the Debtors' wind-down;

  (d) Participation under the Performance Incentive Plan shall
      be limited to the approximately 28 employees identified or
      to identified by the Debtors to the Committee. The amount
      of the pool subject to the Performance Incentive Plan
      shall be with relative distribution to participants at
      midpoint to be based on 20% to 40% of base salary as
      determined by the Debtors;

  (e) Steeve Moore shall serve as the officer responsible for
      administering the Debtors' wind-down upon the departure of
      Mr. Cusano. In addition to participation in the Retention
      Payment Plan as set forth above, in consideration for
      services to be rendered as the officer responsible for
      administering the wind-down, Mr. Moore shall be fully
      vested, and be entitle to receive:

      -- on May 1, 2002, 70% of all severance payments and the
         continuation of all other benefits under his existing
         employment agreement;

      -- on the earlier of the date on which the wind-down of
         the estates is substantially completed, or a dated to
         be agreed upon with the Committee, the remaining 30% of
         all severance payments and all other obligations under
         his existing employment agreement; and

      -- a special bonus as may be agreed to with the Committee
         based upon overall recovery to creditors, timely
         administration of the estates or other relevant
         criteria. (Service Merchandise Bankruptcy News, Issue  
         No. 26; Bankruptcy Creditors' Service, Inc., 609/392-
         0900)


SHARED TECHNOLOGIES: Inks Pact to Sell Assets to Exus Networks
--------------------------------------------------------------
Exus Networks, Inc. (OTC Bulletin Board: EXUS), a global
provider of end-to-end telecommunications services, announced
that it has signed an agreement to acquire the assets of Shared
Technologies Cellular, Inc. (OTC Bulletin Board: STCL), a
wireless telecommunications company with aggregated 2001
revenues of approximately $20 million.  Financial terms of the
transaction were not disclosed.

STC provided pre-paid communications and cellular phone products
and services through its nationwide sales organization and in
conjunction with numerous marketing partners.  In September of
2001, STC filed a voluntary petition for relief under Chapter 11
of Title 11 of the United States Code.

Under the terms of the agreement, Exus will own the assets of
STC, including STC's state of the art call center and databases
of pre-paid cellular customers.  Exus will expand STC's pre-paid
business and launch a new pre-paid product, RoamBuddy USA, as a
compliment to its successful pre-paid travel phone, RoamBuddy
Travel.  Advanced plans are underway to integrate STC's
infrastructure to achieve maximum operating efficiencies.

Ike Sutton, Exus Chairman and CEO, commented, "The acquisition
of Shared Technologies' assets fits perfectly into our strategic
plan.  The company has an extensive back office infrastructure
for billing, service activations, client information, inventory,
and account management, as well as numerous distribution
channels through its state of the art call center, agent
relationships, marketing partners, vending machines, and direct
mail.  This agreement makes it possible for us to immediately
add to our existing revenue base, launch new products, and
support future acquisitions."

Based in New York, Exus Networks is a global provider of a broad
array of value-added, satellite and terrestrially based
communication services to a diverse client base that includes
medium to large multi-national businesses, internet service
providers (ISP's), and governmental agencies.  Through service
agreements and strategic relationships with satellite, teleport,
and terrestrial network operators and the Company's satellite
gateway and data center in New York, Exus Networks benefits from
the growing need for affordable, premium quality managed data
networking services.  This is particularly true in emerging
markets, where EXUS benefits from a first-mover advantage.  
Markets in which the Company is currently active include Poland,
Ukraine, Kazakhstan, Uzbekistan, Greece, and Cyprus.  To learn
more about the Company, please visit its Web site at
http://www.exus.net


STEAKHOUSE PARTNERS: Files for Chapter 11 Petitions in Calif.
-------------------------------------------------------------
On February 15, 2002 San Diego, California-based Steakhouse
Partners, Inc., filed for reorganization, under Chapter 11 of
the United States Bankruptcy Code in the Central District of
California located in Riverside.

February 19, 2002 its subsidiaries, Paragon Steakhouse
Restaurants, Inc., Paragon of Nevada, Paragon of Michigan and
Paragon of Wisconsin are also filing for reorganization under
Chapter 11 of the United States Bankruptcy Code in the Central
District of California located in Riverside.

By filing under Chapter 11 the Company is seeking to retain core
locations, eliminate non-competitive leases, restructure its
debt, and withdraw from under-performing markets.

The Company believes that the bankruptcy reorganization will be
completed by the end of fiscal 2002.

Steakhouse Partners, Inc., through its subsidiaries operates
64 full-service steakhouse restaurants in 11 states, principally
under the brand names of Hungry Hunter's, Hunter's Steakhouse,
Mountain Jack's and Carvers.  The Company's restaurants
specialize in complete steak and prime rib meals, and offer
fresh fish and other lunch and dinner dishes, serving over 6.8
million meals annually.


STOCKWALK GROUP: Dotcom Unit to Sell All Assets to J.B. Oxford
--------------------------------------------------------------
On February 5, 2002, Stockwalk Group, Inc.'s directors John E.
Feltl, John C. Feltl, Louis Fornetti and Jan Breyer resigned
from the board of directors.

On February 11, 2002, Stockwalk Group, Inc. filed a voluntary
petition for reorganization under Chapter 11 of the United
States Bankruptcy Code in the United States Bankruptcy Court for
the District of Minnesota. The case is captioned In Re Stockwalk
Group, Inc., Case No. 02-40585 (RJK).

Also on February 11, 2002, Stockwalk Group, Inc. announced that
its wholly-owned subsidiary, Stockwalk.com, Inc., has agreed to
sell substantially all of its assets to J.B. Oxford, Inc.
Stockwalk.com, Inc. will receive $1,250,000 in cash and $850,000
in J. B. Oxford common stock, subject to certain adjustments.
The transaction is expected to close in early March, 2002.

The company's Miller Johnson Steichen Kinnard subsidiary
performs retail stock brokerage services for individuals and
institutions through nearly 30 offices in eight states. Its
investment banking operations target small cap, emerging, and
startup firms located primarily in the upper Midwest. Subsidiary
Stockwalk.com offers online securities trading. Stockwalk Group
also provides research services to other brokerage firms and
financial services companies. It sold the stock clearing
business of MJK Clearing to Southwest Securities Group.
Executives Eldon Miller, David Johnson, Jack Feltl, and Paul
Kuehn together own almost half of Stockwalk Group.


TELTRONICS INC: Falls Below Nasdaq Equity Listing Requirements
--------------------------------------------------------------
Teltronics, Inc. (Nasdaq: TELT), dedicated to excellence in the
design, development, and assembly of electronics equipment and
software that enhances the performance of telecommunications
networks, announced that it has received a Nasdaq Staff
Determination at the close of business on February 15, 2002,
indicating that Teltronics fails to comply with the minimum net
tangible assets or minimum stockholders' equity requirements for
continued listing, set forth in Marketplace Rule 4310(c)(2)(B)
and that its common stock is therefore subject to delisting from
The Nasdaq SmallCap Market.

Marketplace Rule 4310(c)(2)(B) states that "For continued
inclusion, the issuer shall maintain: (i) stockholders' equity
of $2.5 million; (ii) market capitalization of $35 million; or
(iii) net income of $500,000 in the most recently completed
fiscal year or two of the last three most recently completed
fiscal years."

The Company said it will file, on or before February 21, a
request for a hearing before the Nasdaq Qualifications Panel to
review the staff determination.  Meanwhile, Teltronics added,
its stock will continue to be traded on the Nasdaq SmallCap
Market.  The hearing date will be determined by Nasdaq and
should occur within 45 calendar days from now, the Company said.

The Company was also notified that it did not comply with the
$1.00 minimum bid price requirement for continued listing on The
Nasdaq SmallCap Market set forth in Nasdaq Marketplace Rule
43109(c)(4).  In accordance with Nasdaq Marketplace Rule
4310(c)(8)(D) the Company will be provided 180 calendar days or
until August 13, 2002 to regain compliance.  If at anytime
before August 13, 2002, the bid price of the Company's common
stock closes at $1.00 per share for a minimum of 10 consecutive
trading days, Nasdaq Staff will provide written notification
that the Company is in compliance with the Rule.

If Teltronics stock is delisted, it will be eligible for
quotation on the OTC Bulletin Board.

Teltronics, Inc. (Nasdaq: TELT) is dedicated to excellence in
the design, development, and assembly of electronics equipment
and software that enhances the performance of telecommunications
networks.  The Company manufactures telephone switching systems
and software for small to large sized businesses, government,
and 911 public safety communications centers.  Teltronics
provides remote maintenance hardware and software solutions to
help large organizations and regional telephone companies
effectively monitor and maintain their telecommunications
systems.

The Company also serves as an electronic contract manufacturing
partner to customers in the U.S. and overseas.  Interactive
Solutions, Inc., a subsidiary of Teltronics, Inc., designs and
markets technologically advanced, multimedia computer solutions
for the education of hard-of-hearing, deaf and learning disabled
people.  Teltronics' common stock trades on The NASDAQ SmallCap
Market tier of The NASDAQ Stock Market under the symbol "TELT".  
Further information regarding Teltronics can be found at their
Web site, http://www.teltronics.com


VERTEX INTERACTIVE: Working Capital Deficit Tops $15 Million
------------------------------------------------------------
Vertex Interactive, Inc. (NASDAQ:VETX), a leading provider of
supply chain execution solutions, announced operating results
for the fiscal first quarter ended December 31, 2001.

               First Quarter Financial Results

For the fiscal first quarter ended December 31, 2001, Vertex
reported operating revenues of $13.0 million, compared with
$14.7 million for the same period last year and $14.8 million in
the fiscal fourth quarter ended September 30, 2001. The decline
in sales in the quarter reflects: (1) a full quarter of post-
September 11th impact; and (2) the difficult selling environment
for enterprise application software generally as purchasing
decisions were postponed.

Vertex's reported net loss improved nearly 25% to $6.1 million,
compared with a reported net loss in the same period last year
of $8.0 million. Reported results include the impact of a $1.2
million non-cash interest expense item related to the issuance
of our convertible notes.

Gross profit improved 15% to $4.3 million compared with $3.8
million last year. Gross margin rose to 33% from 25.4% a year
ago.

Total operating expenses declined 23% to $8.9 million from $11.7
million a year ago. Operating losses were $4.7 million compared
with an operating loss of $7.9 million last year, a 41%
improvement.

Cash operating losses were $4.2 million compared with cash
operating losses in the same period last year of $4.9 million, a
15% improvement.

Selling & Administrative expenses fell 5% to $7 million from
$7.4 million. Sequentially, Selling & Administrative expenses
fell nearly 18%. Given additional expense reductions completed
since the end of the fiscal first quarter, management
anticipates that Selling & Administrative expenses will decline
in both real dollars and as a percentage of sales for the rest
of the fiscal year.

Research & Development expenses rose 16% year over year,
including the impact of our acquisition of the transportation
management assets in February 2001. Excluding the impact of that
acquisition, R&D expenses declined 14% year over year.
Sequentially, R&D expenses fell modestly. R&D spending is
expected to stabilize in real dollars as the Company has
substantially completed its foundational development spending
and is focusing now on enhancing the core functionality across
the solution suite. Management expects that, as a percentage of
sales, R&D will gradually decline for the rest of the fiscal
year.

                    Balance Sheet

We reported $1.5 million in cash and cash equivalents at
December 31, 2001.

At December 31, 2001 our net accounts receivable were $9.5
million, compared with $11.2 million at September 30, 2001.

Commenting on the results Nicholas Toms, CEO, said, "This is the
first full quarter in which we operated in the aftermath of the
events of September 11th and we signaled on our year-end
conference call that the full impact was likely to be reflected
in the first half of our fiscal year 2002 and the December
quarter in particular. This proved to be the case. Like many
companies in our space, we experienced an initial freeze in
activity after September 11th. Activity began to pick up towards
the end of the quarter. This activity is now translating into
firm orders with firm rollout schedules as we illustrate below.

"We were nonetheless able to improve our gross profitability by
15% in the quarter. As previously announced, we are now able to
focus on our core higher margin, higher growth enterprise
solutions and we have therefore already announced actions to
accelerate divestiture of non-core businesses that we believe
can contribute to profitability and form the solid foundation
for our future long-term profitable growth as an enterprise
software provider."

At December 31, 2001, our balance sheet showed that total
current liabilities exceeded total current assets by around $15
million.

Financing: As previously announced, we have accepted an offer to
purchase our French and Italian hardware maintenance operations,
which employ over 100 people (approximately 20% of our total
workforce). This transaction is expected to close during March
2002.

We are currently considering offers for our bar-code reseller
businesses in Germany, Holland and France. In addition, we are
in negotiations with respect to our hardware maintenance
business in the United Kingdom and our equipment reseller
businesses in Italy, France, the U.K. and Ireland. Our goal is
to complete these transactions by March 31, 2002. Completing
these transactions will significantly sharpen our focus on
enterprise software solutions.

These transactions, and others we are actively negotiating, are
expected to raise sufficient funds to meet our obligations and
fund our current growth plans through cash breakeven, which we
expect to reach in June 2002.

Cost Reduction: Since the end of December we have reduced our
total headcount by about 8% and now have about 500 worldwide
employees. Through certain planned initiatives, including the
sale of certain non-core operations, we expect this fiscal year
to reduce headcount substantially worldwide. While some of these
planned actions will impact our total sales levels, we also
expect that as a more focused company, we will improve our
operating leverage and put ourselves in a position for
sustainable long-term profitable growth.

Since year-end we have also made progress in consolidating our
facilities. In January we closed two facilities and we are
currently in the process of considering alternatives with
respect to three other facilities. We have also made progress in
bringing together employees in a more rational and we hope
efficient location structure.

We believe we have completed the lion's share of the R&D
spending associated with our enterprise Java?-based product set.
We will be devoting our R&D primarily toward enhancements to the
core functionality and we hope to be able to share with you our
progress on this effort over the course of the rest of this
year.

                            Outlook

We are currently targeting in the range of 10% revenue growth
this year, excluding any strategic developments that may impact
the top line.

Vertex Interactive is an international provider of supply chain
management technology with operations in North America and
across Europe. Vertex offers a comprehensive range of software
systems and tools, from point solutions, to integrated end-to-
end hardware and software solutions, for enterprise wide and
collaborative supply chain optimization.

Vertex Interactive's broad portfolio of products include advance
planning and scheduling with forecasting, purchasing and multi-
sourcing; fixed and mobile order entry, processing and
fulfillment; inventory, warehouse, and transportation management
systems. Vertex's inventory and warehousing product suite also
covers a range of point solutions which provide instant
productivity gains including "light-directed" systems for
picking and packing, intuitive software and integration
technology for handheld devices, auto ID and printing solutions
(for standard, 2D and 3D bar coding), and a suite of mobile data
collection solutions for SAP R/3 implementations.

Combining this extensive product portfolio with its own
industry-leading consultancy, expertise in systems integration
and customization, and unrivalled ongoing support and
maintenance for hardware and software systems, Vertex
Interactive provides its customers with a genuine supply chain
'solution'. From improving the pick rate in a single warehouse,
to fully integrated dynamic planning and execution system in a
collaborative environment, Vertex provides companies with the
right solution to ensure instant efficiency savings and a rapid
return on investment.

Vertex has a rapidly growing international presence, with
customers including leading companies such as, ABX USA, Air
Express International, Avery Dennison, Bacardi Martini, Bic,
Bristol Myers Squibb, Coca Cola, Daimler Chrysler, Express
Dairies, Georg von Opel, GlaxoSmithKline, IBM, Kraft Foods,
Merck, Pfizer, Nestle, North Sea Ferries, Parts Express, the
McLane division of Wal-Mart and Warner Lambert. For additional
information, please visit its Web site at
http://www.vertexinteractive.com  


WINSTAR COMMS: Williams Demands Payment of Postpetition Bills
-------------------------------------------------------------
Williams Communications LLC wants immediate payment from a
$60,000,000 escrow fund for all sums due Williams for services
rendered from and after December 19, 2001 through the date all
such services are actually and properly disconnected.

William P. Bowden, Esq., at Ashby & Geddes in Wilmington,
Delaware, relates Winstar Communications, Inc., and its debtor-
affiliates have defaulted on payments due Williams under the
sale order, has given incomplete and vague orders to discontinue
certain services which has caused Williams to continue to incur
third-party charges due to the Debtors' failure to give proper
notice and the Debtors have attempted to retroactively terminate
services it received since December 19, 2001amounting to a over
$4,346,181.54 as of February 13, 2002.

Mr. Bowden informs the Court that Williams and the Debtors
entered into a written IRU Agreement dated December 17, 1998
pursuant which Williams agreed to allow the Debtors to use
certain optical fibers contained in Williams' fiber optic system
and to provide voice and data transmission services. The
Debtors, in turn, agreed to make payments for the use of the
Fibers and Capacity.

Prior to the petition date, Mr. Bowden states that the Debtors
defaulted on its payments due under the Lease Agreement and
Williams exercised its right, pursuant thereto, to terminate the
Lease Agreement effective Apri111, 2001. Prior to the Petition
Date, Williams initiated disconnection of the Fibers and
notified Winstar to remove all of its equipment attached to the
Fibers and as of Petition Date, the Debtors owed Williams over
$39,000,000 in unpaid pre-petition payments.

After receiving Williams' termination notice, according to Mr.
Bowden, the Debtors requested that Williams continue to provide
services to the Debtors and entered into a post-petition
settlement whereby Williams would continue to provide services
to the Debtors. Under the Williams Settlement, the actual costs
of third party services used by Winstar and paid for by Williams
under the terms of the Lease Agreement would be paid monthly by
the Debtors to Williams. Thereafter, these costs averaged over
$525,000 per week. Further, the costs of services rendered by
Williams directly to Winstar, including Capacity and Fiber
services on the Williams' Network would be accrued and Williams'
claim for such amounts would be included under the DIP Credit
Agreement. Thereafter, these costs averaged over $635,000 per
week.

Mr. Bowden claims that the Debtors defaulted on the payments due
under the Settlement and Williams terminated its obligation to
provide further services to Winstar and proceeded to give the
appropriate regulatory agencies notice of termination of
Winstar's service. On December 10, 2001, the Court entered the
TRO, which helped preserve the business of Winstar for sale to
the Buyer, cost Williams approximately $1,280,000 for "Off-Net"
services consumed by Winstar during the duration of the TRO, for
which Williams had to pay the third party providers and for
which Williams has only an administrative claim which will never
be paid. During Williams' compliance with the TRO, Winstar
consumed "On-Net" services from Williams in the approximate
amount of $805,000, for which Williams has a claim as a DIP
Lender and on which Williams expects only a fractional payment.
For Off-Net Services provided by Williams under the Settlement,
the Debtors owe Williams over $5,900,000 and during the same
period Williams provided OnNet Services in an amount over
$15,200,000 for which Williams is to be added as a Post-Petition
Lender under the DIP Credit Agreement pursuant to the Order
Approving Williams Settlement.

On December 19, 2001, Mr. Bowden notes the Court approved the
Sale Order which includes an injunction against providers such
as Williams, whereby providers are required to continue to
provide the same services to the Buyer as were being provided to
the Debtors immediately prior to the sale, for at least 120 days
or until such time as the Buyer could decide which services to
continue with and which services to discontinue. The Sale Order
requires the Buyer to pre-pay weekly for the services provided
and at the time the Sale Order was entered, charges for services
Williams was providing to Winstar accrued at approximately
$999,000 per week. To protect suppliers such as Williams against
the risk of Buyer's non-payment, the Sale Order provides for an
escrow of $60,000,000, so that if a supplier is not paid, it can
move this Court for payment from the escrow.

Mr. Bowden points out that Williams has continued to provide
services to the Buyer, as required by the Sale Order but the
Buyer has failed to pay Williams weekly in advance as required
by the Order. As of February 13, 2002, the Buyer is in default
to Williams for the amount of $4,346,181.54. On January 9, 2002,
Winstar sent Williams a letter, under which Winstar purported to
give notice of termination of the "dark fiber network" services
provided by Williams to the Buyer, retroactive to December 19,
2001. Winstar further advised that Winstar still has equipment
in unspecified Williams' POPS which "supports the lit capacity"
and "should not be disturbed;" however, Winstar failed to
describe in any manner which equipment in which locations or
which circuits should not be disturbed.

Mr. Bowden submits that Williams responded with its letter of
January 23, 2002, and inquired of what authority Winstar had
from the Buyer to request discontinuance of services being
provided to the Buyer. Williams further advised that more
specific information would be needed for Williams to discontinue
what the Buyer believes to be the "dark fiber network," so that
Williams would not cut off the wrong services. Given that the
Buyer is still running traffic over certain portions of what
Williams identifies as the "dark fiber network," Williams
requested any notice of termination be filed with the Court so
that interested parties, including the FCC, could be advised of
the pending termination of services carrying active traffic.

Mr. Bowden states that no response has been received from
Winstar but continues to "short pay" Williams on its' weekly
payments to Williams. Since Williams received no response to its
request for a specific identification of services to be
disconnected, and because the bulk of the monetary dispute
appears to revolve around the "dark fiber network," Williams has
given the Buyer notice of default and of Williams' intent to
discontinue what Williams identifies as the "dark fiber"
services. Specifically, terminating the services will include
the following:

A. immediate termination of all power to the transmission sites
     and POP sites,

B. cessation of route maintenance services, and

C. the recovery of Williams' stranded assets, such as conduit,
     riser space, rack space, fibers between floors and jumpers.

Accordingly, Williams asks that the Court order the Buyer to
remove all Winstar/Buyer's equipment in the POPS within 30 days,
that the Buyer be required to pay collocation charges until the
equipment is removed, or that all such equipment be deemed
abandoned after 30 days. The lingering presence of this
equipment following termination of service will prevent Williams
from reselling services and space to other parties. Williams has
been especially concerned about terminating the "dark fiber
network" because as of the date this motion was filed the Buyer
is still sending traffic over certain circuits in the "dark
fiber network".

The Letter purports to retroactively disconnect the "dark fiber
network" back to December 19, 2001, and advised that the Buyer
will deduct amounts attributable to the dark fiber from payments
to Williams for services rendered after December 19, 2001. Since
Williams was proceeding to disconnect Debtor's services when
stopped by the TRO, since Williams was required to continue to
provide all such services under the Sale Order, since Williams
has in fact provided all those services to the Buyer, since
Williams has yet to receive a disconnect order from the Buyer,
and since the Buyer has and continues to run traffic over
certain of those circuits, Mr. Bowden contends that it would be
unfair for the Court to sanction any "retroactive" disconnection
requests. Williams should be paid in full for all services
rendered from December 19, 2001, through the actual date such
services are disconnected. Nevertheless, the Buyer has withheld
payment for the "dark fiber network" and deducted amounts
attributable for charges back to December 19, 2001, from current
bills.

Mr. Bowden submits that the Buyer has discontinued some services
with Williams but while stopping payment for discontinued
services, the Buyer has failed and refused to cooperate fully to
achieve discontinuance of those services. For example, the Buyer
has failed and refused to give "DFOC" notices to third party
providers with regard to discontinued "Off-Net" and to local
exchange carriers with loops connected to terminated "On-Net"
services. Without those DFOC notices from the Buyer, the third
party providers refuse to terminate the services and continue to
charge Williams ongoing charges for those services. Moreover, so
long as the LECs' loops remain connected to Williams' fibers,
Williams is unable to resell its fiber capacity connected to the
loops in question. Thus, the Buyer's failure to give the DFOC
notices costs Williams ongoing charges from third parties as
well as prevents Williams from reselling the related capacity on
its network. (Winstar Bankruptcy News, Issue No. 23; Bankruptcy
Creditors' Service, Inc., 609/392-0900)  


* DebtTraders' Real-Time Bond Pricing
-------------------------------------

Issuer               Coupon   Maturity   Bid - Ask Weekly change
------               ------   --------   --------- -------------
Crown Cork & Seal     7.125%  due 2002  77.5 - 79.5   -2.5
Federal-Mogul         7.5%    due 2004    14 - 16       -1
Finova Group          7.5%    due 2009    36 - 37        0
Freeport-McMoran      7.5%    due 2006    80 - 83       +1
Global Crossing Hldgs 9.5%    due 2009  2.75 - 3.75     -0.25
Globalstar            11.375% due 2004     6 - 8         0
Lucent Technologies   6.45%   due 2029    67 - 69     -0.5
Polaroid Corporation  6.75%   due 2002     7 - 9        +1
Terra Industries      10.5%   due 2005    84 - 87       +1
Westpoint Stevens     7.875%  due 2005    35 - 38       +1
Xerox Corporation     8.0%    due 2027    57 - 59       -1

Bond pricing, appearing in each Thursday's edition of the TCR,
is provided by DebtTraders in New York. DebtTraders is a
specialist in global high yield securities, providing clients
unparalleled services in the identification, assessment, and
sourcing of attractive high yield debt investments. For more
information on institutional services, contact Scott Johnson
at 1-212-247-5300. To view our research and find out about
private client accounts, contact Peter Fitzpatrick at
1-212-247-3800. Real-time pricing available at
http://www.debttraders.com

                          *********

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.

Bond pricing, appearing in each Thursday's edition of the TCR,
is provided by DebtTraders in New York. DebtTraders is a
specialist in global high yield securities, providing clients
unparalleled services in the identification, assessment, and
sourcing of attractive high yield debt investments. For more
information on institutional services, contact Scott Johnson at
1-212-247-5300. To view our research and find out about private
client accounts, contact Peter Fitzpatrick at 1-212-247-3800.
Real-time pricing available at http://www.debttraders.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. Yvonne L. Metzler, Bernadette
C. de Roda, Ronald P. Villavelez and Peter A. Chapman, Editors.

Copyright 2002.  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-
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                     *** End of Transmission ***