---

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

            Tuesday, September 3, 2002, Vol. 6, No. 174     

                          Headlines

AIMGLOBAL TECHNOLOGIES: Enters Compromise Pact with Creditors
AMERICA ONLINE LATIN AMERICA: Violates Nasdaq Listing Guidelines
ANC RENTAL: Court Okays National Tax Resource's Engagement
ANCHOR GLASS: Firms-Up Equity Deal with Cerberus Capital
APPLE CAPITOL: Court Sets Sept. 11 as Auction Date for Assets

ARMSTRONG: Assumes Amended Supply Contract with ExxonMobil
ASBESTOS CLAIMS: Wants to Continue Gibson Dunn's Engagement
AUTO-Q INT'L: Considering Funding Options to Continue Operations
BALDWINS INDUSTRIAL: Seeks Approval to Hire Fulbright & Jaworski
BALL CORP: S&P Revises Outlook on BB+ Credit Rating to Negative

BIG BUCK BREWERY: Fixes Sept. 13 Record Date for Reverse Split
BIO-TECHNOLOGY: Fails to Comply with Nasdaq Listing Requirements
BISTRO 2000-6: Fitch Junks Class C and D Fixed-Rate Notes
BUDGET GROUP: Signing-Up Sidley Austin as Bankruptcy Counsel
CAMPBELL SOUP: Vlasic Files Suit Alleging Misrepresentations

CANMINE RESOURCES: Ontario Court Grants 90-Day CCAA Extension
CARBIDE/GRAPHITE: Inks Pact to Sell Assets to Resilience Capital
CELL TECH: Working Capital Deficit Narrows to $5.4MM at June 30
CHILDTIME LEARNING: Appoints Frank Jerneycic as New VP and CFO
COHO ENERGY: Closes Sale of All Oil & Gas Properties for $222MM

CONMED CORP: S&P Changes Outlook to Stable Over Debt Refinancing
CONSOLIDATED FREIGHTWAYS: Expects to File Ch. 11 Petitions Today
CREDIT STORE: Gets Nod to Use $500K of Lender's Cash Collateral
DICTAPHONE CORP.: Has Until Jan. 28, 2003 to Challenge Claims
ECHOSTAR: ITC Confirms Company Doesn't Infringe Gemstar Patents

ENRON CORP: ENA Sues Tribune to Recover $22MM Termination Fee
EXIDE: Asks Court to Reconsider Portions of Blackstone Order
FEDERAL-MOGUL: Equity Committee Turns to Deloitte for Advice
GALEY & LORD: Has Until Dec. 17 to Make Lease-Related Decisions
GEMSTAR-TV: Wants to Appeal Int'l Trade Commission Decision

GLOBAL CROSSING: Asks Court to Approve Settlement with Sonus
GLOBAL CROSSING: Reports Net Loss of $145 Million for July 2002
GREAT AMERICAN: S&P Assigns BB+ Preferred Share Ratings
HORSEHEAD INDUSTRIES: Look for Schedules & Statements on Oct. 3
INSCI: Files Form 10-KSB/A for Fiscal Year Ended March 31, 2002

INTERNET ADVISORY: Must Raise New Funds to Support Business Plan
IT GROUP: Sues Sovereign to Avoid & Recover Fraudulent Transfers
KMART: Proposes Uniform Non-Core Asset Sale Bidding Procedures
KNOWLES ELECTRONICS: Raises $10MM from Senior Sub. Debt Issue
LASERSIGHT INC: Sets Annual Shareholders' Meeting for October 25

LSP BATESVILLE: NRG Downgrade Spurs S&P to Hatchet Rating to B
MARINER POST-ACUTE: Seeks Final Decree Closing Subsidiary Cases
MERRILL CORP: S&P Junks Classes A & B Senior Subordinated Notes
MOUNTAIN OIL: Auditors Doubt Company's Ability to Continue Ops.
NETIA: Creditors' Meeting to Vote on Plans Continued to Sept. 30

NRG GROUP: Continues to Pursue Efforts to Sell Remaining Assets
NUTRITIONAL SOURCING: Misses Interest Payment on Two Debt Issues
OSE USA: March 31, 2002 Balance Sheet Upside-Down by $29 Million
OUTSOURCING SERVICES: S&P Lowers Corporate Credit Rating to B-
PACIFIC GAS: Asks Court to Okay Settlement with Sierra re PPAs

PACIFIC GAS: District Court Reverses Preemption Decision
PG&E CORP: Obtains New Waiver Extension Until October 4, 2002
PRINTERA CORP: Closes US Operations and Consolidates in Canada
QWEST COMMS: S&P Lowers Ratings on Three Synthetic Transactions
RECOTON: Gets Waivers of Default & Loan Purchase Pact Amendments

RESOURCE RECOVERY: Inks Fuel Tax Credit Multilateral Settlement
RETURN ASSURED: Goldstein Golub Raises Going Concern Doubt
ROHN INDUSTRIES: Signs Amendment to Credit & Forbearance Pacts
SAFETY-KLEEN: Systems Wants to Sell 3E Company Stake for $12MM
SHELDAHL INC: Consummates Bankruptcy Sale to Investors' Group

SHENANDOAH RESOURCES: CCAA Protection Extended Until Sept. 13
TOWER AUTOMOTIVE: Declares Dividend on 6-3/4% Conv. Preferreds
TWO WAY TV: May Not Continue Due to "Weak Financial Condition"
UNITED AIR: Presents Proposed Labor Cost Concessions to Unions
US AIRWAYS: Bringing-In KPMG as Auditors and Tax Advisors

USG CORP: Asks Court to Restrict Plan Voting to Sick Claimants
VIASYSTEMS: Will File for Prepack. Chapter 11 Reorg. Late Sept.
VSOURCE INC: Appoints Braden Waverley as New Company President
WARNACO GROUP: Keeps Plan Filing Exclusivity Until September 30
WORLD WIRELESS: Inks Marketing Agreement with Service Concepts

WORLDCOM: Motorola Asks Court to Require Cash Collateral Acctg.
XCEL: Sells Remaining Interest in Yorkshire Power Group for $33M
XCEL ENERGY: Closes $450MM Bond Sale for Northern States Unit

                          *********

AIMGLOBAL TECHNOLOGIES: Enters Compromise Pact with Creditors
-------------------------------------------------------------
AimGlobal Technology Company, Inc., (TSE/Amex: AGT) announced
progress in completing its financial restructuring process
through the accomplishment of two key steps in that process:
exchange approval of conversion of its senior debt into equity
and implementation of a compromise agreement with certain of its
creditors.

As previously announced, on May 14, 2002, a private merchant
bank, Valtec Capital Corporation acquired the bank debt AGT owed
to the Canadian Imperial Bank of Commerce. Valtec's agreements
with AGT provide for conversion of its loan into AGT common
shares on terms previously reported, subject to approval by the
Toronto Stock Exchange and shareholders. AGT reported that the
TSE has approved the conversion transaction conditioned upon
shareholder approval and certain other events.

AGT further announced that the TSE has also approved an issuance
and private placement of $2.1 million of convertible debentures
to Valtec under which Valtec would be entitled to convert
principal and interest on the debentures into common stock of
AGT at $0.35 per share. The TSE's approval of this placement is
also subject to certain conditions including shareholder
approval.

AGT anticipates that the annual general shareholders meeting
will be held in December 2002, at which time these transactions
will be submitted to shareholders for approval.

As previously reported, AGT has reached agreements with
creditors representing in excess of $11 million in liabilities
to compromise their claims against the company. AGT today
announced it has begun distributing the initial cash portions of
the settlement distributions to those settling creditors that
have submitted the required documentation. AGT's management
believes that the process of distributing the cash and
promissory notes provided under the compromise agreements should
be completed within the next few weeks. Management believes that
the compromise agreements will provide the company with relief
from the substantial pressure it has faced and allow it to focus
on completing its operational restructuring and aggressively
pursue new opportunities.

AimGlobal Technologies Company, Inc., a company incorporated
under the laws of British Columbia, operates in the electronics
manufacturing services business providing contract manufacturing
for original equipment manufacturers in the medical, aerospace,
wireless, communications, industrial, military and emergency
response markets in Canada and the United States. The Company
offers a full range of services including product development
and design, material procurement and management, prototyping,
manufacturing and assembly, functional and in-circuit testing,
final system box build and distribution.


AMERICA ONLINE LATIN AMERICA: Violates Nasdaq Listing Guidelines
----------------------------------------------------------------
America Online Latin America, Inc. (NASDAQ-SCM:AOLA), a leading
interactive services provider in Latin America, has received a
letter from NASDAQ stating that the Company has not met the $35
million market capitalization requirement for continued listing
of its Class A Common Stock on the NASDAQ SmallCap Market
(Marketplace Rule 4310(C)(2)(B)(ii)).

America Online Latin America intends to request a hearing before
the NASDAQ Listing Qualifications Panel to appeal the ruling by
NASDAQ. During the appeals process, which the Company expects
will take between 30 and 60 days, the Company's class A common
stock will continue to trade on the NASDAQ SmallCap Market.
There can be no assurance that the Panel will grant the
Company's request for continued listing. In the event that the
Panel does not grant continued listing, the Company expects that
its class A common stock would trade on the Over-the-Counter
Bulletin Board. The OTCBB is a regulated quotation service that
displays real-time quotes, last-sales prices, and volume
information for more than 3,600 equity securities.

Charles Herington, President and CEO of AOL Latin America, said:
"We remain committed to our shareholders and to maintaining our
position as a leading ISP in Latin America, one of the fastest
growing Internet markets in the world. We will continue to
operate under normal conditions and continue to implement
initiatives aimed at strengthening our business fundamentals,
including targeting higher value members and streamlining
operations. In addition, as previously announced, we anticipate
that our cash on hand as well as cash available under our
financing agreement with AOL Time Warner will be sufficient to
fund operations into early 2003."

America Online Latin America, Inc., (NASDAQ-SCM: AOLA) is the
exclusive provider of AOL-branded services in Latin America and
has become one of the leading Internet and interactive services
providers in the region. AOL Latin America launched its first
service, America Online Brazil, in November 1999, and began as a
joint venture of America Online, Inc., a wholly owned subsidiary
of AOL Time Warner Inc. (NYSE:AOL), and the Cisneros Group of
Companies. Banco Itau, a leading Brazilian bank, is also a
minority stockholder of AOL Latin America. The Company combines
the technology, brand name, infrastructure and relationships of
America Online, the world's leader in branded interactive
services, with the relationships, regional experience and
extensive media assets of the Cisneros Group of Companies, one
of the leading media groups in the Americas. The Company
currently operates services in Brazil, Mexico and Argentina and
serves members of the AOL-branded service in Puerto Rico. It
also operates a regional portal accessible at
http://www.aola.com America Online's 35 million members  
worldwide can access content and offerings from AOL Latin
America through the International Channels on their local AOL
services.


ANC RENTAL: Court Okays National Tax Resource's Engagement
----------------------------------------------------------
Judge Walrath approves ANC Rental Corporation and its debtor-
affiliates' application but makes these specific modifications
to National Tax Resource Group's Engagement Letter:

A. Goals and Services of Engagement:  Goals will read -- "As
   your property tax program consultant, we will utilize our
   locally qualified consultants who will be paid at our expense
   and have the ability to pursue minimization of your property
   tax obligation within the constraints of state law and local
   practice.  In order to accomplish this, our ad valorem tax
   services consist of three phases: compliance, negotiation and
   appeal.  Additionally we will be pursuing refunds of taxes
   paid in previous years by utilizing the law firm of Brusniak
   Harrison & McCool, P.C. as counsel, who will be retained and
   compensated directly by ANC, other counsel retained at ANC's
   expense, as well as our local consultants retained at our
   expense, in concert with the proposed filings of Request of
   Hearing under Section 505 of the Bankruptcy Code";

B. Administrative Services:  Representation will read --
   "Subject to approval under 11 U.S.C. 327, ANC will employ
   Brusniak Harrison as counsel to assist the Debtors and NTRG
   in pursuing refunds of taxes paid in prior years, and may
   also retain other counsel.  ANC will pay all fees incurred by
   Brusniak Harrison and any other counsel during this
   representation, subject to the terms of orders approving
   NTRG's and Brusniak Harrison's retention, and further subject
   to the provisions of the Bankruptcy Code, local rules and any
   orders of this Court.  These fees will be deducted from the
   percentage fees due to NTRG.  If there are no tax savings
   realized in connection with NTRG's efforts, neither Brusniak
   Harrison, nor any local counsel retained by ANC will be
   entitled to any fees, and any fees paid specifically for
   services which produced no tax savings would be subject to
   disgorgement";

C. Statement Of Limiting Conditions:  The first full sentence of
   the second paragraph will read -- "NTRG will not be
   responsible for penalties, interest, or other charges
   resulting from the late payment of taxes"; and

D. Fees: Percentage Fee will read -- "Client agrees to pay NTRG
   a percentage equal to 30% of the total tax savings obtained
   from our appeal, less any attorneys' fees paid by ANC in
   connection with the appeal.  Tax savings are defined as the
   actual current year tax savings realized as a direct result
   of the difference between the current year proposed
   assessment and the current year final assessment, and will be
   based on the applicable current year tax rate.  Client agrees
   to pay NTRG a percentage equal to 33% of the tax savings,
   less any attorneys' fees paid by ANC in connection with the
   appeal of all refunds resulting from pursuit of assessment
   reductions for previous years under Section 505 of the
   Bankruptcy Code. With respect to assessment reductions for
   previous years, tax savings are defined as the actual
   previous year tax savings realized as a direct result of the
   difference between the previous year proposed assessment and
   the previous year final assessment, and will be based on the
   applicable previous year tax rate.  The percentage fee set
   forth in this paragraph will constitute the exclusive
   compensation payable by Client for the services provided
   hereunder.  For the avoidance of doubt, NTRG will not be
   entitled to reimbursement for, or to otherwise recover,
   expenses incurred by NTRG, or the local consultants engaged
   to assist NTRG, in providing services." (ANC Rental
   Bankruptcy News, Issue No. 18; Bankruptcy Creditors' Service,
   Inc., 609/392-0900)


ANCHOR GLASS: Firms-Up Equity Deal with Cerberus Capital
--------------------------------------------------------
Anchor Glass Container Corporation, the nation's third-largest
manufacturer of glass beverage containers, has finalized its
plan of reorganization, including the equity investment by
Cerberus Capital Management LP, a New York City-based investment
management firm.

In mid-March, Cerberus agreed to infuse Anchor Glass with $100
million in new capital, of which $80 million is in the form of
equity capital.  Anchor Glass said the investment will help the
company serve its expanding customer base.

"We're pleased to have Cerberus aboard as our equity sponsor,
validating both the strength of our business and the excellent
health of our industry as a whole," said Richard M. Deneau,
president of Anchor Glass.  "Business continues to be very good
and we expect Cerberus' participation in our business to enhance
what is already a bright future."

The consummation of Anchor Glass' plan of reorganization comes
less than a month after the U.S. Bankruptcy Court for the Middle
District of Florida, Tampa Division confirmed a restructuring
plan Anchor Glass filed in April.

Anchor Glass Container Corporation is the third-largest
manufacturer of glass containers in the United States and
employs 2,900 at 12 U.S. locations. It supplies beverage and
food producers and manufacturers of consumer products worldwide.
The company has been based in Tampa, Fla. since 1983.


APPLE CAPITOL: Court Sets Sept. 11 as Auction Date for Assets
-------------------------------------------------------------
On August 1, 2002, the U.S. Bankruptcy Court for the Southern
District of Florida approved Apple Capitol and its debtor-
affiliates' Sales Procedures in connection with the proposed
sale of substantially all of the Company's assets.  The assets
will be sold to one bidder, at an auction to be conducted at the
offices of Akerman Senterfitt or at another location in Fort
Lauderdale, Florida, timely disclosed by the Debtors to
Qualified Bidders, on Wednesday, September 11, 2002 at 10:00
a.m. prevailing Eastern Time.

All bids for the Company's assets must be in accordance with
uniform Sales Procedures, submitted in writing and received not
later than Wednesday, September 4, 2002 at 4:00 p.m. prevailing
Eastern Time, by:

      Akerman Senterfitt & Eidson, P.A.
      Las Olas Centre II, Suite 1600
      350 East Las Olas Boulevard
      Fort Lauderdale, Florida 33301-2229
      Attn: Denise D. Dell, Esq.
            David C. Peck, Esq.

with copies served on:

      (i) The Debtors
          Apple Capitol Group, LLC
          490 Sawgrass Corporate Parkway, Suite 330
          Sunrise, Florida 33325
          Attn: James Gillespie, Esq.

          
     (ii) Counsel for Lehman
          Hahn & Hessen
          Empire State Building
          350 Fifth Avenue
          New York, New York 10118-0075
          Attn: Jeffrey L. Schwartz, Esq.

                  -and-
         
          Berger Singerman
          200 South Biscayne Boulevard
          Suite 2000
          Miami, Florida
          Attn: Paul S. Singerman, Esq.
    
    (iii) Counsel for the Committee
          Olshan Grundman Frome Rosenzweig & Wolosky LLP
          505 Park Avenue
          New York, New York 10022
          Attn: Andrew I. Silfen, Esq.
                Schuyler G. Carroll, Esq.   
    
September 4, 2002, is also the deadline for any objections to
the Debtors' sale of its Assets.  Copies of the Objections must
also to be served on the parties listed above and to the Office
of the United States Trustee.

The Court further sets Friday, September 13, 2002, at 9:30 a.m.
as the date for a Sale Hearing to consider the entry of an order
authorizing and approving:

      (i) the sale of the Purchased Assets free and clear of all
          liens, claims, interests and encumbrances;

     (ii) assumption and assignment of certain executory
          contracts and unexpired leases in connection with the
          sale; and

    (iii) the sale's exemption from stamp and other similar
          taxes.

Apple Capitol Group, LLC and its debtor-affiliates filed for
Chapter 11 protection on July 16, 2002.  Denise D. Dell, Esq.,
and David C. Peck, Esq., at Akerman, Senterfitt & Eidson, P.A.
represent the Debtors in its liquidating chapter 11 proceeding.


ARMSTRONG: Assumes Amended Supply Contract with ExxonMobil
----------------------------------------------------------
Armstrong World Industries Inc., obtained the Court's authority
to assume an amended executory contract with Exxon Chemical
Company, a division of Exxon Corporation, now known as
ExxonMobil Chemical Company.

The principal terms of the ExxonMobil Agreement are:

    (1) Quantity.  ExxonMobil sells AWI 72,500,000 pounds of
        plasticizer per year.  The plasticizer is delivered
        to AWI manufacturing plants located in Pennsylvania,
        Mississippi, Oklahoma, Illinois, California, New
        Jersey and Montreal, Canada;

    (2) Price.  The net invoice price AWI pays ExxonMobil
        under this agreement is dependent upon the grade of
        plasticizer purchased and the location to which the
        plasticizer is shipped.  The actual agreement
        containing these prices is filed under seal and
        unavailable;

    (3) Term.  The original term of the ExxonMobil agreement
        expired on December 31, 2001, but extends
        automatically from year to year after that, subject
        to the right of either party to terminate the
        agreement upon 90 days' prior written notice;

    (4) Payment.  AWI receives proximo 15-day terms
        with a cash discount, or proximo 30-day terms.

    (5) Volume Performance Allowance.  ExxonMobil provides
        AWI with a volume performance or rebate equal to
        up to $0.01 per pound of plasticizer purchased
        from Exxon.  The VPA is calculated for each
        manufacturing plant based upon the amount of
        plasticizer AWI purchases for each plant;

    (6) Product Warranty.  ExxonMobil warrants that the
        product delivered to AWI under this agreement

        -- will conform with the specifications set out
           in the ExxonMobil/AWI agreement,

        -- are of merchantable quality, and

        -- as delivered to AWI, do not infringe on the
           patents, technical know-how, or other
           intellectual properties of third parties.

        To the extent any products do not conform to the
        specifications set out in the agreement, AWI is
        entitled to return the products to ExxonMobil
        for replacement at ExxonMobil's expense;

    (7) Indemnity.  To the extent any claims, liabilities
        or obligations arise as a result of any breach of
        warranty by ExxonMobil or by the failure of any
        product to satisfy the warranties set out in the
        agreement, ExxonMobil is required to indemnify AWI
        in an amount not to exceed $1,000,000 in any
        calendar year.  ExxonMobil has no liability for
        special, incidental, consequential or exemplary
        damages unless such damages are caused by gross
        negligence or willful misconduct;

    (8) Price Adjustments.  Upon 15 days' prior written
        notice, ExxonMobil may change any price, freight,
        and/or payment term on the first day of January,
        April, July or October; and

    (9) Competitive Adjustments.  If a North American
        competitor of ExxonMobil offers to sell AWI at
        least 10,000,000 pounds of plasticizer that is:

           (i) of equal quality to that supplied by
               ExxonMobil, and

          (ii) at a price greater than or equal to half
               a cent below ExxonMobil's net price
               (including the VPA) per pound,

        ExxonMobil is entitled to submit revised
        pricing to address the competitive situation.
        Alternatively, ExxonMobil may modify this
        agreement to permit AWI to accept the
        competitive offer and deduct the quantity to be
        purchased from the competitor from the total
        quantity to be delivered to AWI under this
        agreement.  In the case of DINP purchases,
        however, AWI may purchase up to 10,000,000
        pounds of plasticizer from an ExxonMobil
        competitor without expecting ExxonMobil to meet
        the competitive price.

AWI currently owes ExxonMobil prepetition amounts totaling
between $1,515,000 and $1,690,000 under this Agreement.

                       The Amendments

Under a 2002 Letter Agreement amending the ExxonMobil/AWI
Agreement, AWI and ExxonMobil have agreed to several new
provisions relating to, among other things:

    -- AWI's prepetition debt under the ExxonMobil agreement,

    -- the establishment of a global volume performance
       allowance or rebate, and

    -- the transition to a contingent billing arrangement for
       certain AWI warehouse facilities.

The 2002 Letter Agreement provides that:

    (1) Prepetition Debt.  ExxonMobil will reduce the amount
        of AWI's prepetition debt by $1,000,000;

    (2) Global Volume Performance Allowance.  AWI and its
        affiliates will receive a global volume performance
        allowance based upon annual worldwide sales of
        plasticizer to AWI and its affiliates.  Based upon
        AWI's current annual volume of 72,500,000 pounds,
        the Global VPA will be equal to 0.5% for each pound
        of plasticizer purchased from ExxonMobil.  AWI
        estimates this will result in annual savings of
        $135,000;

    (3) Consignment Billing Arrangement.  AWI and ExxonMobil
        have agreed to work towards implementing a consignment
        billing arrangement, under which ownership of, and
        financial responsibility for, the materials shipped by
        ExxonMobil to certain warehouse locations will be
        transferred to AWI upon AWI's use of the materials.
        The consignment billing arrangement contemplates the
        establishment of a monitoring system that will enable
        ExxonMobil to manage the inventory shipped to AWI's
        warehouses for billing purposes.  The consignment
        billing arrangement will alter the current billing
        arrangement under the ExxonMobil/AWI agreement under
        which AWI takes ownership of, and financial
        responsibility for, the materials shipped by
        ExxonMobil when they are delivered to AWI; and

    (4) Credit.  ExxonMobil may:

           (i) demand advance cash payment or satisfactory
               security if the financial responsibility of
               AWI becomes impaired or unsatisfactory to
               ExxonMobil, and

          (ii) withhold shipments until payment or security
               is received.

The 2002 Letter Amendment also replaces the payment, term and
price provisions in the ExxonMobil/AWI agreement.  Specifically,
the 2002 letter amendment modifies the ExxonMobil/AWI agreement
by providing that:

    (1) AWI will receive monthly summary bills with net
        25-day payment terms for all consignment billing
        locations and net 30-day payment terms for all
        other locations;

    (2) The term of the ExxonMobil/AWI agreement will
        expire on December 31, 2004, and extend from year
        to year thereafter, subject to the right of either
        party to terminate the agreement on December 31,
        2004, or any anniversary of that date upon 90 days'
        prior written notice; and

    (3) ExxonMobil will reduce the net invoice price by
        $0.01 for each pound of plasticizer AWI purchases
        from ExxonMobil and issue a credit to AWI in the
        amount of $0.01 per pound for all volumes purchased
        between July 1, 2002, and the date AWI's assumption
        of the ExxonMobil/AWI agreement, as amended, is
        approved by Judge Newsome.  AWI estimates that this
        will result in a net savings of $450,000 per annum.

Moreover, the 2002 Letter Agreement amends a portion of the
ExxonMobil/AWI agreement governing price adjustments.  
Specifically, the 2002 letter provides that AWI may, in its
discretion, purchase up to 10% of its prior 12 months'
plasticizer purchases from ExxonMobil from any of ExxonMobil's
North American competitors without expecting ExxonMobil to meet
the competitive price offered by any competitor. (Armstrong
Bankruptcy News, Issue No. 27; Bankruptcy Creditors' Service,
Inc., 609/392-0900)   


ASBESTOS CLAIMS: Wants to Continue Gibson Dunn's Engagement
-----------------------------------------------------------
Asbestos Claims Management Corporation asks the U.S. Bankruptcy
Court for the Northern District of Texas for interim and final
orders authorizing it to employ Gibson, Dunn & Crutcher LLP as
attorneys.

The Debtor reminds the Court that Gibson Dunn has represented it
and its non-debtor parent, the NGC Settlement Trust, as general
outside counsel and NGC's reorganization cases in 1993.  Because
of this long-standing relationship, Gibson Dunn has a
comprehensive understanding of these entities affairs.  Both
entities requested a dual representation during the pendency of
this case.  Although the companies do not believe that any
actual or potential conflict exists as a result of Gibson Dunn's
dual representation, they have executed a conflicts waiver
letter.  

Gibson Dunn is expected to:

     a) provide legal advice to the Debtor in respect of its
        powers and duties as debtor-in-possession;

     b) take all necessary action to protect and preserve the
        Debtor's estate, including the prosecution of actions on
        the Debtor's behalf, the defense of any actions
        commenced against the Debtor, the negotiation of
        settlements concerning litigation in which the Debtor
        may be involved, and the objection to claims filed
        against the estate;

     c) prepare, on behalf of the Debtor, all necessary motions,
        applications, answers, orders, reports and papers in
        connection with the administration of its estate;

     d) negotiate and prepare on behalf of the Debtor, the Plan
        and all related documents, and to prosecute the Plan
        through the confirmation process; and

     e) perform all other necessary or appropriate legal
        services in connection with this chapter 11 case and in
        connection with any matter as requested by the Debtor.

The NGC Settlement Trust has agreed to pay all the
administrative expenses, including fees of professionals, in
this chapter 11 case.  The Debtor does not relate Gibson Dunn's
specific hourly rates.

Asbestos Claims Management Corporation filed for chapter 11
protection on August 19, 2002 at the U.S. Bankruptcy Court for
the Northern District of Texas. Michael A. Rosenthal, Esq., and
Janet M. Weiss, Esq., at Gibson, Dunn & Crutcher represent the
Debtor in its restructuring efforts.  When the Company filed for
protection from its creditors it listed debts and assets of over
$100 million.


AUTO-Q INT'L: Considering Funding Options to Continue Operations
----------------------------------------------------------------
Auto-Q International, Inc., is a United States holding company,
and its wholly-owned subsidiary, Warminster Systems Limited is a
United Kingdom company. Warminster is engaged in the
development, supply and installation of mobile data acquisition
and vehicle tracking systems to corporate users throughout the
United Kingdom. The Company operates as a single segment. In
March 2002, Auto-Q's registration statement was declared
effective by the Securities and Exchange Commission.

Auto-Q was incorporated in the State of Delaware on April 26,
2001 and merged effectively on April 27, 2001 with Warminster, a
private company incorporated in Bristol, England.

Pursuant to this merger, Auto-Q issued 6,300,000 shares of its
common stock for all of the common stock of Warminster. As a
result of this acquisition, the stockholders of Warminster
effectively acquired Auto-Q and control thereof. In conjunction
with the exchange of shares, the then stockholders of Auto-Q
gave 2,612,400 shares to new employees. Accordingly, this
acquisition has been accounted for as a reverse acquisition for
financial statement purposes.

Revenues are generated from the sale, installation, and
maintenance and monitoring of the Company's vehicle tracking and
data acquisition systems. Total revenues for the nine months
ended June 30, 2002 and June 30, 2001 were $900,418 and $556,661
respectively, representing an increase of $343,757, or 61.8%,
for the nine months ended June 30, 2002 from the nine months
ended June 30, 2001. The increase in revenue resulted primarily
from an increase in the number of systems sold to existing
customers and the expansion of the Company's customer base. In
the nine month period ended June 30, 2002, as compared to the
nine month period ended June 30, 2001, the Company sold an
additional 98 fuel monitoring and satellite tracking units to
existing customers including Walkers Snack Foods, Mercedes Benz,
Scania Trucks and MFI. This resulted in an increase in sales of
equipment revenue of $339,733, or 70.8%, to $819,473 from
$479,740 for the nine months to June 30, 2002 and 2001,
respectively. Service and maintenance revenues for the nine
months ended June 30, 2002 and 2001 were $80,945 and $76,921,
respectively.

At June 30, 2002, the Company had $403 of cash and a working
capital deficiency of $997,870 and for the nine months ended
June 30, 2002, it has sustained a net loss of $527,804. These
circumstances raise substantial doubt about its ability to
continue as a going concern. Its ability to continue as a going
concern is dependent upon positive cash flows from operations
and/or financing from the issuance of equity securities. Without
such financing, it may not be able to meet working capital
requirements. Auto Q plans on expanding business by hiring
additional sales and marketing staff, investing in product
development, information technology enhancement and
acquisitions.

Due to the expansion of its customer base and the roll-out of
new products and services during fiscal 2001, the Company
anticipates requiring additional cash to support the anticipated
growth in accounts receivable and inventory. It also expects its
operating expenses to increase as it aggressively seeks to
expand awareness of its products and services through its
marketing campaign and increase its sales personnel. The Company
is considering a variety of funding alternatives including the
issuance of equity or debt securities.

Adequate funds may not be available when needed or may not be
available on terms favorable to Auto Q. If unable to secure
sufficient funding, the Company may be unable to develop or
enhance its products and services, take advantage of business
opportunities, respond to competitive pressures or grow its
business as hoped. This could have a negative effect on its
business, financial condition and results of operations.


BALDWINS INDUSTRIAL: Seeks Approval to Hire Fulbright & Jaworski
----------------------------------------------------------------
Baldwins Industrial Services, Inc., and Baldwin Leasing LP want
the U.S. Bankruptcy Court for the Southern District of Texas to
give them authority to employ Fulbright & Jaworski, LLP as their
counsel.

Fulbright & Jaworski will:

     a) advise and consult with Debtors with respect to their
        powers and duties as debtor-in-possession in the
        continued operation of their business and management of
        their properties;

     b) represent the Debtors in communication with vendors,
        creditors, ad hoc and official committees and others
        with respect to the conduct of these cases under Chapter
        11;

     c) represent Debtors in cash collateral and debtor-in-
        possession financing negotiations and litigation, as
        necessary;

     d) represent the Debtors in asset sales and other liquidity
        transactions, as necessary;

     e) represent Debtors concerning assumption and assignment
        or rejection or other disposition of their executory
        contracts and leases;

     f) assist Debtors in the development, negotiation,
        litigation and confirmation of a Chapter 11 plan or
        plans of reorganization or liquidation and the
        preparation of a disclosure statement or statements,
        concerning treatment of secured and unsecured claims
        including secured, trade, and other debt, as well as
        equity.

     g) prepare Debtors' necessary applications, motions,
        orders, complaints, adversary proceedings, answers,
        reports, and other pleadings and legal documents, in
        connection with matters affecting Debtors and their
        estates;

     h) take actions as necessary to preserve and protect the
        Debtors' assets, including, if required by the facts,
        the prosecution of avoidance actions and adversary or
        other proceedings on Debtors' behalf, defense of actions
        commenced against Debtors, negotiations concerning
        litigation in which Debtors are involved, objection
        claims filed against Debtors estates, and estimation
        against the estates;

     i) provide the legal services necessary to the
        representation of the Debtors in these chapter 11 cases,
        or to the administration;

     j) provide a full range of legal services including with
        respect to corporate governance, securities, litigation,
        tax, labor, environment, intellectual property, and
        other interests of the Debtors and their estates; and

     k) other legal services as the Debtors may request.

The Debtors will compensate Fulbright & Jaworski at its hourly
rates:

          Partners                    $320 to $575 per hour
          Associates                  $145 to $280 per hour
          Counsel and Senior Counsel  $185 to $405 per hour
          Paralegals                  $80 to $225 per hour

Baldwins Industrial Services Inc., and Baldwins Leasing LP  
filed for chapter 11 protection on August 26, 2002.  Jack M.
Partain, Jr., Esq., at Fulbright & Jaworksi represent the
Debtors in their restructuring efforts.  When the Company filed
for chapter 11 protection it listed assets of not more than $10
million and estimated debts at not more than $50 million.


BALL CORP: S&P Revises Outlook on BB+ Credit Rating to Negative
---------------------------------------------------------------
Standard & Poor's Ratings Services revised its outlook on
Broomfield, Colorado-based Ball Corp., to negative from
positive. At the same time, Standard & Poor's affirmed its
ratings, including the double-'B'-plus corporate credit rating,
on the metal can and plastic packaging producer. These actions
follow the recent announcement by Ball that it has agreed to
acquire Schmalbach-Lubeca AG for about $885 million (900 million
euros) in cash, and the assumption of about 16 million euros of
net debt.

"The outlook revision reflects the increased risks associated
with the transaction, including the meaningful increase in
Ball's debt levels and the challenges in integrating a large-
scale manufacturing business," said Standard & Poor's credit
analyst Paul Vastola. The transaction is subject to regulatory
approvals and is expected to close in late 2002 or early 2003.
Total debt pro forma for the acquisition at June 30, 2002, will
climb to about $2 billion from about $1.1 billion. Standard &
Poor's will evaluate the proposed financing plan and any rating
implications for existing senior noteholders, upon availability
of updated terms and conditions.

The ratings on Ball reflect the company's solid market positions
and stable cash flow generation, offset by its aggressive
financial management. Ball is the largest aluminum beverage can
producer in North America, with an estimated 33% market share.
Ball is also a leading producer of metal food cans and PET
(polyethylene terephthalate) beverage containers. A profitable
aerospace business generates about 11% of revenues. Ratingen,
Germany-headquartered S-L is the second-largest beverage can
producer in Europe with about 31% share, revenues of $1 billion,
and EBITDA of about $174 million for the 12 months ended June
30, 2002.

Following the completion of the S-L acquisition, Ball will
become the largest global beverage can producer, having leading
shares in the two largest can markets, North America and Europe.
The acquisition will also improve its geographic diversity and
modestly reduce its high customer concentration. Ball should
also benefit from better growth prospects, as the European
market is still growing in the mid-single-digit percent area,
unlike the mature North American market. Still, competition is
intense, stemming from large global rivals and intermaterial
substitution. Although management has a good track record of
buying and integrating businesses, the S-L acquisition will be
challenging both in its scope and because it will be the
company's first foray into Europe. In order to counter potential
difficulties, Ball plans to retain S-L's experienced management
team.

In the intermediate term, should the company be unable to
restore its credit measures to more appropriate levels, ratings
will likely be lowered.

Ball Corp.'s 8.25% bonds due 2008 (BLL08USR1) are trading
slightly above par at about 103, DebtTraders reports. See
http://www.debttraders.com/price.cfm?dt_sec_ticker=BLL08USR1for  
real-time bond pricing.


BIG BUCK BREWERY: Fixes Sept. 13 Record Date for Reverse Split
--------------------------------------------------------------
Big Buck Brewery & Steakhouse, Inc., (Nasdaq: BBUC) has fixed
September 13, 2002 as the record date for the one-for-seven
reverse stock split approved by the company's shareholders.  
Pursuant to the reverse split, the company will issue one new
share in exchange for every seven outstanding shares.  
Appropriate adjustment also will be made with respect to the
number of shares issuable upon exercise or conversion of
outstanding options, warrants and other rights.  Shares of the
company's common stock will begin trading on a post-reverse
split basis on September 16, 2002.

Among other things, the company's board of directors determined
to implement the reverse split in an effort to regain compliance
with the $1.00 minimum bid price requirement for continued
listing set forth in Marketplace Rule 4310(C)(4).  As previously
announced, the company's securities are subject to delisting
from The Nasdaq SmallCap Market.

The company will make its formal request for continued listing
at a hearing before a Nasdaq Listing Qualifications Panel on
September 19, 2002. If the Panel determines to delist the
company's securities, the company will not be notified until the
delisting has become effective.  There can be no assurance that
the Panel will grant the company's request for continued
listing.

If the company's securities do not continue to be listed on The
Nasdaq SmallCap Market, such securities would become subject to
certain rules of the SEC relating to "penny stocks."  Such rules
require broker-dealers to make a suitability determination for
purchasers and to receive the purchaser's prior written consent
for a purchase transaction, thus restricting the ability to
purchase or sell the securities in the open market.  In
addition, trading, if any, would be conducted in the over-the-
counter market in the so-called "pink sheets" or on the OTC
Bulletin Board, which was established for securities that do not
meet Nasdaq listing requirements.  Consequently, selling the
company's securities would be more difficult because smaller
quantities of securities could be bought and sold, transactions
could be delayed, and security analyst and news media coverage
of the company may be reduced.  These factors could result in
lower prices and larger spreads in the bid and ask prices for
the company's securities.  There can be no assurance that the
company's securities will continue to be listed on The Nasdaq
SmallCap Market.

Big Buck Brewery & Steakhouse, Inc., operates restaurant-
brewpubs in Gaylord, Grand Rapids and Auburn Hills, Michigan,
offering casual dining featuring a high quality, moderately
priced menu and a variety of award-winning craft-brewed beers.  
In August 2000, the company opened its fourth unit in Grapevine,
Texas, a suburb of Dallas.  This unit is owned and operated by
Buck & Bass, L.P., pursuant to a joint venture agreement between
the company and Bass Pro Outdoor World, L.L.C.


BIO-TECHNOLOGY: Fails to Comply with Nasdaq Listing Requirements
----------------------------------------------------------------
Bio-Technology General Corp., (NASDAQ: BTGC) announced receipt
of a letter from NASDAQ indicating that BTG had not complied
with Marketplace Rule 4310(c)(14) because its consolidated
financial statements included in its Quarterly Report on Form
10-Q for the period ended June 30, 2002 have not been reviewed
by its independent auditors in accordance with Statement on
Auditing Standards No. 71 because of the restatement and reaudit
previously disclosed, and discussed below, and that its
securities are therefore subject to delisting from the NASDAQ
National Stock Market.

BTG will request a hearing before a NASDAQ Listing
Qualifications Panel to appeal the potential delisting from
NASDAQ, which will be stayed, pending the panel's decision,
although there can be no assurance that the NASDAQ Listing
Qualifications Panel will grant the request for continued
listing by BTG. In the interim, effective August 29, 2002, BTG's
stock will trade on NASDAQ under the symbol BTGCE.

BTG is working diligently with KPMG to complete the reaudit
which it anticipates will be completed during September 2002.
Upon completion of the reaudit, BTG will file an amended annual
report on Form 10-K and amended quarterly reports to reflect the
reaudit. BTG anticipates that the filing of these amended
reports will cure any deficiency and allow BTG to remain listed.

As previously disclosed, on May 8, 2002 BTG engaged KPMG LLP as
its independent auditors replacing Arthur Andersen LLP. In
August 2002, BTG announced that in connection with a reaudit by
KPMG it would be restating its financial statements for the
years ended 1999 through 2001 to expense (i) the costs
associated with establishing alternate manufacturing sources for
its approved drug Oxandrin(R) and for a new tablet formulation,
which costs were previously capitalized, and (ii) compensation
for certain employees and former employees made in connection
with the termination of their employment and post-employment
consulting arrangements, which expense should have been
recognized at the time of modification.

Dr. Sim Fass, Chairman and Chief Executive Officer, stated: "Our
being out of compliance relates exclusively to the fact that
KPMG could not review our second quarter 2002 filing until the
reaudit of 1999 through 2001 is completed. We are well along in
the reaudit process and anticipate its completion and the filing
of amended financial reports by the end of September. We believe
that our 2002 financial results will not be impacted negatively
by the reaudit and that our third quarter 2002 and annual
filings will be timely."


BISTRO 2000-6: Fitch Junks Class C and D Fixed-Rate Notes
---------------------------------------------------------
Fitch Ratings has downgraded two classes of notes from the
Bistro 2000-6 program. Bistro 2000-6 is a synthetic balance
sheet collateralized debt obligation established by JP Morgan to
provide credit protection on a $4 billion portfolio of
investment grade loans. No rating action has been taken or
contemplated at this time for the class A and class B notes
which are rated 'AAA' and 'AA' respectively. The following
classes have been downgraded:

-- $100,000,000 class C fixed-rate notes to 'CCC-' from 'BBB+';

-- $30,000,000 class D fixed-rate notes to 'C' from 'BBB-'.

Fitch's rating action reflects the deterioration in credit
quality of several of the underlying assets as well as higher
than expected credit protection payments under the credit
default swap. As a result, there is a diminished level of credit
enhancement for the notes.


BUDGET GROUP: Signing-Up Sidley Austin as Bankruptcy Counsel
------------------------------------------------------------
Robert L. Aprati, Budget Group Inc.'s Executive Vice President,
General Counsel and Secretary, believes that these cases are
complex and the Debtors will require counsel that is part of an
international firm, with a national and international reputation
and with extensive experience in insolvency and bankruptcy
cases, including cross-border insolvency issues, as well as
specialized and substantial expertise in litigation and in
corporate, real estate and tax law.  The Debtors seek to employ
and retain Sidley Austin Brown & Wood as their reorganization
and bankruptcy counsel for these cases to fill that role.

The Debtors expect Sidley:

-- to provide legal advice with respect to the Debtors' powers
   and duties as debtors in possession in the continued
   operation of their businesses and management of their
   properties;

-- to take all necessary action to protect and preserve the
   Debtors' estates, including prosecuting actions on behalf of
   the Debtors, defending any actions commenced against the
   Debtors, negotiating any and all litigation in which the
   Debtors are involved, and objecting to claims filed against
   the Debtors' estates;

-- to prepare, on behalf of the Debtors, all necessary motions,
   answers, orders, reports and other legal papers in connection
   with the administration of the Debtors' estates;

-- to perform any and all other legal services for the Debtors
   in connection with the Chapter 11 cases and with the
   formulation and implementation of the Debtors' plan of
   reorganization;

-- to advise and assist the Debtors regarding all aspects of the
   plan confirmation process, including, but not limited to,
   securing the approval of a disclosure statement by the
   Bankruptcy Court and the confirmation of a plan at the
   earliest possible date;

-- to give legal advice and perform legal services with respect
   to general corporate matters, and advice and representation
   with respect to obligations of the Debtors, their Boards of
   Directors and officers;

-- to give legal advice and perform legal services with respect
   to matters involving the negotiation of the terms of and the
   issuance of corporate securities, matters related to
   corporate governance and the interpretation, application or
   amendment of the Debtors' corporate documents, including
   their Certificates of Incorporation, by-laws and material
   contracts, and matters involving stockholders and the
   Debtors' legal duties toward them;

-- to give legal advice and perform legal services with respect
   to real estate and tax issues relating to all of the
   foregoing; and

-- to render any other services as may be in the best interests
   of the Debtors in connection with any of the foregoing, as
   agreed upon by Sidley and the Debtors.

Mr. Aprati tells the Court that Sidley is a full-service law
firm with a national and international presence.  Sidley has
more than 1,400 lawyers in thirteen offices located in major
cities throughout the United States, Europe, and Asia.  Sidley
has experience and expertise in every major substantive area of
legal practice and its regular clients include leading public
companies in a variety of industries, privately-held businesses,
and major nonprofit organizations.

In the months leading up to the Petition Date, Mr. Aprati
relates that Sidley has been advising the Debtors as to
restructuring and insolvency issues, including factors
pertaining to the commencement of these cases, as well as to
general corporate, real estate, tax and litigation matters.  In
so doing, Sidley has become intimately familiar with the Debtors
and their affairs. The partners and associates of Sidley who
will advise the Debtors in these cases have wide-ranging
experience in insolvency and bankruptcy law, as well as in
litigation and corporate, real estate and tax law.  The Debtors
believe that Sidley is uniquely well-qualified to represent them
as debtors in possession in these Chapter 11 cases.

Sidley has indicated a willingness to act on the Debtors' behalf
at its normal and customary rates for matters of this type,
together with reimbursement of all costs and expenses incurred
by Sidley.  Sidley's billing rates currently range from:

         Partners              $375 - $700
         Associates            $160 - $425
         Paraprofessionals      $80 - $165

Sidley partner Larry J. Nyhan, Esq., informs the Court that the
Firm has represented the Debtors in preparation for these
filings, and has received a retainer in connection with
preparing for the filing of these Chapter 11 cases and for its
proposed postpetition representation of the Debtors.  All fees
and expenses of Sidley with respect to the prepetition period
have been paid.  The $300,000 retainer will constitute a general
retainer for postpetition services and expenses.  Sidley has
received $3,323,492.04 on account of legal services rendered in
contemplation of or in connection with these bankruptcy cases
within one year prior to the Petition Date.

Mr. Nyhan assures the Court that Sidley does not hold or,
represent any interest adverse to the Debtors' estates in
matters upon which Sidley is to be engaged, and is
disinterested. However, Sidley currently represents in matters
unrelated to these cases, these parties:

A. Lenders: Credit Suisse First Boston, Bank of America N.A.,
   Bank of Montreal, Bank of New York, Bank of Nova Scotia, Bank
   of Tokyo-Mitsubishi, Bank Polska Kasa Opieki S.A., Cerberus
   Partners L.P., Commerzbank, Credit Agricole Indosuez, Credit
   Lyonnais, Dresdner Bank, Erste Bank Der Oesterreichischen
   Sparkassen AG, Fleet Bank NA, Fuji Bank, Imperial Bank,
   General Electric Capital Corp., Goldman Sachs Credit Partners
   LP, Merill Lynch Pierce Fenner & Smith Inc., Natexis Banque,
   Sumitomo Mitsui Banking Corp.;

B. Unsecured Creditors:  Wells Fargo Bank Minnesota, Bear Sterns
   Securities Corp., JP Morgan Chase Bank, The Bank of New York,
   Credit Suisse First Boston, Wachovia Bank NA, Morgan Stanley
   & Co., State Street Bank & Trust Co., Salomon Smith Barney
   Inc., Deutsche Bank Trust Co., Citibank NA, Donaldson Lufkin
   & Jenrette Securities Corp., Goldman Sachs & Co., Boston Safe
   Deposit & Trust Co., Starcom Worldwide, Bank of America
   Securities LLC, GE Capital Corp., Ameritrade Holding Corp.,
   Charles Schwab & Co., UBS Paine Webber Inc., AT&T, Sabre
   Group, National Financial Services Inc., Galileo
   International, First Clearing Corp., Perot Systems Corp.,
   Prudential Securities Inc., First Data Pos, Philadelphia
   Insurance Co., and Stifel Nicolaus & Co.;

C. Major Vendors:  DaimlerChrysler, Ford Motor Co., Hyundai,
   Nissan, and Toyota;

D. Major Shareholders:  Dimensional Fund Advisors Inc., and
   Deutsche Bank;

E. Indenture Trustees:  Bankers Trust Co., Chase Manhattan Bank,
   Credit Suisse First Boston, JP Morgan, Bank of New York,
   Wells Fargo Bank, and Wilmington Trust Co.;

F. Professionals: Ernst & Young, Jefferies & Co., KPMG, King &
   Spalding, Latham & Watkins, Lazard Freres & Co., and
   Eversheds; (Budget Group Bankruptcy News, Issue No. 5;
   Bankruptcy Creditors' Service, Inc., 609/392-0900)    

Budget Group Inc.'s 9.125% bonds due 2006 (BD06USR1),
DebtTraders reports, are trading at 18.5 cents-on-the-dollar.
See http://www.debttraders.com/price.cfm?dt_sec_ticker=BD06USR1
for real-time bond pricing.


CAMPBELL SOUP: Vlasic Files Suit Alleging Misrepresentations
------------------------------------------------------------
The law firm of Andrews & Kurth filed an Amended Complaint in
U.S. District Court Thursday against Campbell Soup Company on
behalf of the bankruptcy estate of Vlasic Foods International
Inc.  The Amended Complaint alleges that the Campbell made
misrepresentations in dealing with the Internal Revenue Service,
the Securities and Exchange Commission and other entities
involved with the 1998 spin-off transaction which ultimately
resulted in VFI's bankruptcy.

John A. Lee, lead counsel for the VFI creditors, had this to say
about the amended filing: "This filing is the result of more
than six months of comprehensive investigation into the
circumstances that led to VFI's bankruptcy and liquidation,
including interviews with dozens of former VFI and Campbell
employees. Our investigation established that Campbell's real
motivation in the spin-off was to unload problem businesses it
wanted to get rid of and transfer as many of its debts to VFI as
it could get away with by manipulating the financial results and
projections of the VFI businesses. Campbell knew well before the
spin-off closed that VFI was careening toward a default and
would likely end up in a liquidation but refused to put the
brakes on its $600 million payday. We expect the Court will find
these allegations are true and that Campbell will be held 100
percent responsible for VFI's liquidation."

Campbell spun off VFI in March of 1998 with more than $500
million of bank debt, in addition to more than $100 million of
other assumed Campbell liabilities, to decrease its own debt
load incurred from its share repurchase program. Evidence
uncovered by A&K lawyers indicates that the $500 million figure
is almost two times the amount of debt that these businesses
should have had on their books at the time or could have
afforded to pay. The amended complaint also states that Campbell
knew in January 1998 that VFI, then still a part of the Campbell
companies, would significantly miss its target quarterly
earnings numbers unless it loaded over 500,000 cases of Swanson
and 100,000 cases of Vlasic products. The complaint alleges that
Campbell instructed VFI to load the cases knowing that the $500
million bank loan was dependent on VFI making its numbers at the
end of the coming fiscal quarter.

The architect of the spin-off was Basil Anderson, Campbell's
former Chief Financial Officer. The Board of Directors for VFI
prior to the spin-off was comprised of Campbell employees,
including many of Mr. Anderson's direct reports. It is alleged
that these Campbell employees could not have been making
decisions in the best interest of the future of VFI's creditors
and shareholders when they structured the transaction. The
Amended Complaint alleges Campbell knew in January of 1998 that
if VFI loaded its second quarter numbers in order to meet the
projections that Campbell had given to the financial
institutions, VFI could not then make its third and fourth
quarter numbers. Compounding this assertion, the pleading
alleges that this information was never conveyed to the banks
and was never disclosed in the Form 10 that Campbell filed with
the SEC on March 10, 1998. Further, Campbell never disclosed to
the banks or to the SEC in the Form 10 that many of the
businesses were carried on Campbell's books, and subsequently
transferred to VFI, at values far in excess of their fair market
value.

The complaint continues to allege that in order to make the
spin-off tax-free to Campbell and its shareholders, Campbell
concocted an excessive tax basis in the spin-off companies by
assigning fair market values to the businesses that were
hundreds of millions of dollars greater than the levels at which
both Campbell and its investment banker valued these businesses.
The pleading also alleges that Campbell misrepresented financial
data and values of the spun-off businesses in its dealings with
the IRS which resulted in a private letter ruling that the more
than $500 million in proceeds Campbell received from the spin-
off would be tax-free to Campbell and its shareholders.

The Complaint alleges that what sealed VFI's fate was Campbell's
forcing one-sided supply and co-pack agreements on VFI in the
weeks before the spin-off, well after the projections were given
to the banks and after the Form 10 was filed with the SEC. It is
noted that Campbell hired several major law firms to protect its
interests in the U.S., U.K., Germany and Canada but did not
provide VFI independent legal counsel or financial advisors to
protect its interests. Finally, it is alleged that Campbell
purposely induced many of its long-term career employees to go
with VFI so that Campbell could effect a cost-free layoff. When
VFI filed for bankruptcy less than three years after the spin-
off, many of these employees lost their medical benefits,
retirement savings and their children's education funds. Many of
these former employees are now listed as unpaid creditors of the
bankrupt VFI estate, and their claims are part of this lawsuit.

Andrews & Kurth L.L.P., was founded in Houston in 1902 and has
360 lawyers in offices in Austin, Dallas, Houston, Los Angeles,
London, New York, The Woodlands and Washington, D.C.  The firm's
practice areas include appellate, bankruptcy, business
transactions, energy, environmental, corporate and securities,
labor and employment, litigation, intellectual property, public
law, project finance, real estate, structured finance, asset
securitization, technology and tax law for U.S. and
international clients.

Additional Points of Information:

     --  This filing can be found at http://www.vfbllc.com  

     --  A class-action suit against Campbell based on some of
the same deceptive practices alleged in this Complaint is now
pending in Federal District Court in New Jersey, Case No. 01-
0272

     --  The original Complaint was filed in February 2002.

                              *   *   *

Campbell Soup's April 28, 2002 balance sheet shows a working
capital deficit of about $1.3 billion.  Campbell Soup is very
highly leveraged -- with a debt-to-equity ratio topping 70:1.  
The Company owes $5.7 billion to creditors and reports $80
million of shareholder equity on its April 28, 2002 balance
sheet.  Campbell Soup has $900 million of bond debt coming due
this year and next.  The notes evidencing those obligations
trade slightly above par.  Campbell Soup common stock trades
north of $20 per share.  


CANMINE RESOURCES: Ontario Court Grants 90-Day CCAA Extension
-------------------------------------------------------------
Canmine Resources Corporation (TSX Symbol: CMR) announces that
Ontario Superior Court of Justice extended an Order for
protection under the Companies' Creditors Arrangement Act for a
further period of 90 days.

On August 2, 2002, Canmine received an initial CCAA Order to
stay current obligations to all creditors for a period of 30
days. The 90-day extension Order received today will continue
this stay and ensure Canmine's financial restructuring process
continues. During this period a Plan of Compromise or
Arrangement will be prepared for submission to the interested
parties and the Court for approval. To finance the Company's
activities during this period, Debtor-in-Possession financing up
to $1.5 million has been approved under the Court Orders,
subject to the monitoring of payments by PricewaterhouseCoopers
Inc.  

Edward L. Ellwood, President and CEO, said, "We are pleased with
today's decision. Together with Beacon Group Advisors Inc., we
have made significant progress in formulating our restructuring
plan and we will continue to work hard to maximize the position
of all stakeholders. We want to thank all of our stakeholders
including our employees for their continued support."

Throughout the next 90 days, Canmine will continue to hold
discussions with various parties and is encouraged by the level
of interest and co-operation it has received from all parties
involved.

Canmine owns a 100% interest in a newly retrofitted cobalt-
nickel refinery located in Cobalt, Ontario. To date, Canmine has
invested $14.5 million, including acquisition costs, to upgrade
the Canmine Refinery which was originally built in 1995 at an
estimated cost of $30 million. The Canmine Refinery employs
pressure acid-leach, solvent extraction, and Merril-Crowe
precipitation to produce cobalt and nickel chemical compounds
along with copper, silver and other metal by-products. The
company also owns an inventory of cobalt-silver feedstock for
the refinery, a cobalt deposit in north-western Ontario, a
nickel deposit in Manitoba, and a nickel exploration project
north-east of Thompson, Manitoba.


CARBIDE/GRAPHITE: Inks Pact to Sell Assets to Resilience Capital
----------------------------------------------------------------
The Carbide/Graphite Group, Inc., announced that as part of its
efforts to emerge from Chapter 11 Bankruptcy, it has signed a
definitive purchase agreement with Resilience Capital Partners
LLC for the assets associated with C/G's electrode and graphite
specialty business unit.  

The terms of the Section 363 asset sale were filed with the
Western District of Pennsylvania Bankruptcy Court on August 30,
2002.  Resilience Capital Partners LLC, based in Cleveland,
Ohio, is an investment fund focused on restructurings and
special situations and will continue to operate the electrode
business in St. Marys, PA and Niagara Falls, NY, and maintain a
business unit headquarters in Pittsburgh, PA.  

In order to facilitate the asset sale, WARN Act notices were
sent to all required parties sixty days prior to the expected
transaction completion date of October 31, 2002.  

Walter Fowler, C/G's CEO, commented, "C/G is operating
comfortably within the DIP financing provided by our Bank Group
and we are pleased to have the Resilience organization
supporting our electrode and graphite specialty business as we
restructure and exit the Chapter 11 process. Many significant
positive achievements have occurred both from a quality and cost
perspective within the electrode business over the past year
which were critical to making this transaction work.  We are
very grateful to the employees who were part of those efforts
and achievements.  We are continuing to pursue restructuring
possibilities for our needle coke and carbide businesses."


CELL TECH: Working Capital Deficit Narrows to $5.4MM at June 30
---------------------------------------------------------------
Cell Tech International Incorporated and The New Algae Company
are engaged in the production and marketing of food supplement
products made with blue-green algae harvested from Klamath Lake,
Oregon. The Company uses a multi-level distributor network
throughout the United States and Canada to distribute its
products.

The Company has suffered recurring losses from operations and
has negative working capital. In addition, the Company is not in
compliance with certain restrictive covenants of its $15 million
Line of Credit Agreement with a financial institution. These
factors raise substantial doubt about the Company's ability to
continue as a going concern.

Net sales for the three months ended June 30, 2002 were $6.8
million, a decrease of $0.8 million, or 11.2%, from net sales of
$7.6 million for the three months ended June 30, 2001. The
decrease in sales is directly related to a 14.1% decrease in
orders for the same period. Average order size increased to $119
from $115 over the same period. The average number of
distributors for the three months ended June 30, 2002 decreased
to an average of 44,260, which was 19% lower than the average of
54,718 distributors for the three months ended June 30, 2001.
Sales of the Company's food supplement products are made through
a multi-level marketing network of distributors, so sales are
positively linked with the number of distributors.

Net loss decreased $801,081, or 107%, to a net income of $52,487
for the three months ended June 30, 2002 from a net loss of
$748,594 for the comparable period in 2001. As a percentage of
net sales, net income was 0.8% for the three months ended June
30, 2002 compared to a net loss of 10% for the comparable period
in 2001. The dollar increase was due to a decrease in selling
expenses and general and administrative expenses as a percentage
of sales offset and a decrease in commission expense as a
percentage of sales.

Net sales for the six months ended June 30, 2002 were
$13,860,819, a decrease of 11.5% from net sales of $15,665,312
for the six months ended June 30, 2001. The decrease in sales is
directly related to a 13% decrease in orders for the same
period. Average order size increased to $119 from $116 over the
same period. The average number of distributors for the six
months ended June 30, 2002 decreased to an average of 45,581,
which was 17% lower than the average of 54,928 distributors for
the six months ended June 30, 2001.

Net loss decreased 109% to net income of $161,560 for the six
months ended June 30, 2002 from a net loss of $1,796,857 for the
comparable period in 2001. As a percentage of net sales, net
income was 1.2% for the six months ended June 30, 2002 compared
to a net loss of 11.5% for the comparable period in 2001. The
dollar increase was due to net sales decreasing by 11.5%, offset
by the curtailment of various operating expenses.

Working capital deficit at June 30, 2002 amounted to $5,418,069,
a decrease of $1,019,117 from a working capital deficit of
$6,437,186 as of December 31, 2001. At June 30, 2002, the
Company had a bank overdraft of $195,732 versus a bank overdraft
of $763,105 as of December 31, 2001. In addition, the Company is
not in compliance with certain restrictive covenants of its $15
million Line of Credit Agreement with a financial institution.
As a result, at December 31, 2001 (fiscal year end), the
Company's independent certified public accountants have
expressed substantial doubt about Cell Tech's ability to
continue as a going concern.

Management of Cell Tech believes that future cash flows from
operations, existing capital resources, bank borrowings and
suspension of dividend payments to shareholders, should be
adequate to fund  operations for at least the next twelve
months. There are no present commitments or agreements with
respect to any acquisitions or purchases of manufacturing
facilities or new technologies.


CHILDTIME LEARNING: Appoints Frank Jerneycic as New VP and CFO
--------------------------------------------------------------
Childtime Learning Centers, Inc., (Nasdaq: CTIM) is pleased to
announce the appointment of Frank M. Jerneycic as Vice President
and Chief Financial Officer.  Mr. Jerneycic succeeds Mr. Leonard
Tylka, interim CFO, effective August 30, 2002.  Mr. Jerneycic
was formerly Senior Vice President and Chief Financial Officer
of Decision Consultants, Inc. of Southfield, MI.

Bill Davis, President and CEO of Childtime Learning Centers,
Inc., stated, "I am extremely pleased that Frank has made the
decision to help lead the company going forward.  Frank has the
financial and strategic leadership skills to enable Childtime to
achieve its long-term profit and growth objectives and to become
the premier leader in the child care industry."  Mr. Jerneycic
commented, "I am excited to be a part of this new leadership
team operating in such a dynamic growth industry."

Childtime Learning Centers, Inc., of Farmington Hills, MI
acquired Tutor Time Learning Systems, Inc. on July 19, 2002 and
is now the nation's third largest publicly traded child care
provider with operations in 30 states, the District of Columbia
and internationally.  Childtime Learning Centers, Inc., has over
7,500 employees and provides education and care for over 50,000
children daily in over 450 corporate and franchise centers
nationwide.
    
Childtime's March 30, 2002 balance sheet shows that its total
current liabilities exceeded its total current assets by about
$5 million.


COHO ENERGY: Closes Sale of All Oil & Gas Properties for $222MM
---------------------------------------------------------------
Coho Energy, Inc., (OTCBB:CHOQE) announced that on Aug. 29, 2002
it completed the sale of all of its oil and gas properties for
an aggregate sales price of approximately $222 million in cash.

Coho Energy's oil and gas properties were sold in two separate
transactions to Citation Oil & Gas Corp., and Denbury Resources,
Inc.

The claims of creditors of Coho Energy who have liens against
properties that were sold attach to the sale proceeds paid to
Coho Energy at closing. Those creditors will receive payments on
allowed claims in accordance with future orders of the
Bankruptcy Court.

Since the estimated claims of Coho Energy's creditors in its
bankruptcy proceedings aggregate in excess of $335 million, it
is unlikely that Coho Energy's shareholders will receive any
distribution upon liquidation of the company. Coho Energy
intends to file a plan of liquidation no later than Oct. 31,
2002. Creditors with allowed claims that do not attach to the
sale proceeds will receive distributions pursuant to Coho
Energy's plan of liquidation after approval by the Bankruptcy
Court.


CONMED CORP: S&P Changes Outlook to Stable Over Debt Refinancing
----------------------------------------------------------------
Standard & Poor's Ratings Services revised its outlook on
medical equipment maker ConMed Corp., to stable from negative
due to the successful refinancing of the company's credit
facility.  The double-'B'-minus corporate credit rating and
double-'B'-minus bank loan rating on the company's senior
secured credit facility were also affirmed. Utica, New York-
based ConMed has total debt outstanding of about $260 million.

"ConMed's new senior secured credit facility extends its
maturities and increases its liquidity, as about $90 million
will be available for use by the company," Standard & Poor's
credit analyst Jordan Grant said. "The bank facility consists of
a $100 million revolving credit facility and a $100 million term
loan; both are about five years in duration."

Standard & Poor's said the refinancing of the company's credit
facility addressed concerns and supports the stable outlook, as
the company had about $95 million of debt maturing through the
end of 2003. Operationally, the recent launch of new battery-
powered instruments and electrosurgical equipment may bolster
competitive prospects. Nevertheless, the large R&D budgets of
competitors, such as Stryker Corp. and Johnson & Johnson, pose
ongoing competitive threats.

An increase in the size of ConMed's sales force and some new
product disappointments have contributed to a decline in
operating margins to about 24% from a 28% peak two years ago.
However, margins remain within the average range for the
industry, and lease-adjusted EBITDA interest coverage of 3 times
is consistent with the rating. Moreover, debt has been reduced
using a combination of proceeds from a $70 million equity
offering in early 2002 and some cash from operations, which has
contributed to a decline in debt to capital to 41% from 55% at
the end of 2001. Credit measures of funds from operations to
lease-adjusted debt of 20% and total debt to EBITDA of about 3x
are also well within the rating category.

Conmed Corp.'s 9.0% bonds due 2008 (CNMD08USR1), DebtTraders
says, are trading slightly above par at about 102.003. See
http://www.debttraders.com/price.cfm?dt_sec_ticker=CNMD08USR1
for real-time bond pricing.


CONSOLIDATED FREIGHTWAYS: Expects to File Ch. 11 Petitions Today
----------------------------------------------------------------
Consolidated Freightways Corp. (Nasdaq:CFWYE), the 73-year old
freight transportation company and nation's third largest less-
than-truckload carrier, told employees in various telephone
communications that it would discontinue operations effective
immediately, and that -- in order to assure the orderly
liquidation of the business -- it planned to file petitions for
Chapter 11 bankruptcy on Tuesday.

Operations of the company's CF AirFreight and Canadian
Freightways, Ltd., subsidiaries are continuing normally, and
their employees will not be terminated as a result of this
action.

Management employees of CF's U.S. operations were briefed in a
9AM conference call. Supervisory personnel received calls from
their managers shortly thereafter. All drivers and freight
terminal employees received instructions at their homes to call
a toll-free number, where they heard a recorded message from
John Brincko, CEO of the company, telling them not to report to
work today.

In letters to be mailed to each employee today, the company said
it had "been vigorously exploring ways to restore the financial
health of the company. We expected that recent discussions with
our banks, other lenders and real estate investors would enable
us to obtain significant additional financial resources and
that, together with the combined efforts of employees, we would
be successful in our restructuring efforts.

"Unfortunately, this has not been the case. Nor do we have the
current resources necessary to sustain the business without
additional financial resources. Therefore, it is with sadness
and regret that I must inform you that Consolidated Freightways
has discontinued operations effective immediately and all CF
terminals are closed."

The company said it planned to file for Chapter 11 bankruptcy
today. It expects to file its Form 10-Q for the period ending
June 30, 2002, at the same time.

In his remarks to employees, Mr. Brincko said that, despite the
severe restrictions imposed on the credit, insurance and real
estate markets since the events of September 11, "and in my very
short three months here, I was hopeful that, with the right
moves at all the right times, we could be successful in turning
the company around."

Mr. Brincko said that until very recently, the company was
hopeful it could secure additional financing. However, he said
that when one of the company's surety bondholders cancelled
coverage related to the company's self-insurance programs for
worker's compensation and vehicular casualty, it negatively
impacted discussions with all lenders and investors. Ultimately
the company was unable to secure financing and to bridge the
surety bond gap, at which point the situation became critical.
Moreover, the company anticipated that a second insurer would
also cancel coverage.

"Without the availability of further financing, the Board of
Directors reluctantly concluded that the company simply could
not continue to operate, pay employees and meet its
obligations," Mr. Brincko said.

Approximately 15,500 employees are impacted by the CFC shutdown.
Of these, more than 80 percent will receive termination notices
immediately. The remaining management and supervisory positions
will be phased out in an expeditious shutdown of the company.

Consolidated Freightways was founded in Portland, Ore. in 1929.
The company provides less-than-truckload transportation,
airfreight forwarding and supply chain management services
throughout North America. The company is headquartered in
Vancouver, Wash.


CREDIT STORE: Gets Nod to Use $500K of Lender's Cash Collateral
---------------------------------------------------------------
The Credit Store, Inc., sought and obtained interim authority
from the U.S. Bankruptcy Court for the District of South Dakota
to use its prepetition lender's cash collateral.  The Debtor is
authorized to borrow from Coast Business Credit a total sum not
to exceed $500,000, pending a final cash collateral hearing.

The Debtor tells the Court that it does not have sufficient
available sources of working capital and cash to operate its
business in the ordinary course without postpetition financing
and use of Coast's cash collateral.  The Debtor's availability  
of working capital to maintain its business relationships with
its vendors, suppliers, and customers, to pay its employees and
otherwise to finance its operations, is essential to its
continued viability.  The Debtor argues that it has an immediate
need for financing to minimize the disruption of its business
operations and to manage and preserve the assets of its
bankruptcy estate in order to maximize the value of the Estate
and recovery to creditors.

Despite diligent efforts, the Debtor is unable to procure
requisite financing in the form of unsecured credit allowable as
administrative expense, or in exchange for the grant of an
administrative expense priority.

The Debtor acknowledged that as of the Petition Date, it was
indebted to Coast Business Credit under the Loan and Security
Agreement dated April 30, 1998, in the aggregate sum of not less
than $8,134,764.

The Postpetition Financing is to be provided to Debtors by
Lender, pursuant to a 14th Loan and Security Agreement and
Postpetition Financing Assumption Agreement dated August 15,
2002.

Pursuant to sections 361 and 363(e), the Lender is entitled to
adequate protection of its interest in the Prepetition
Collateral in exchange of Debtor's use of the Cash Collateral
and the imposition of the automatic stay.

The Court additionally finds that the interest of Thornton
Capital Advisors, under a certain Repurchase Agreement, is
adequately protected by an equity cushion.

The Credit Store, Inc., is primarily in the business of
providing credit card products to consumers who may otherwise
fail to qualify for a traditional unsecured bank credit card.
The Company filed for chapter 11 protection on August 15, 2002.
Clair R. Gerry, Esq., at Stuart, Gerry & Schlimgen, LLP and Mark
E. Andrews, Esq., at Neligan Stricklin, LLP represent the Debtor
in its restructuring efforts.  When the Company filed for
protection from its creditors, it listed $68 million in assets
and $69 million in debts.


DICTAPHONE CORP.: Has Until Jan. 28, 2003 to Challenge Claims
-------------------------------------------------------------
Dictaphone Corp., obtained an extension of its deadline by which
all objections to proofs of claim asserted against its
bankruptcy estate must be filed. Judge Wizmur gave the Debtor
until January 28, 2003, to challenge the claims.  Dictaphone
Corp. broke away from its former parent, Lernout & Hauspie,
under a standalone chapter 11 plan confirmed earlier this year.


ECHOSTAR: ITC Confirms Company Doesn't Infringe Gemstar Patents
---------------------------------------------------------------
EchoStar Communications Corporation (Nasdaq:DISH) announced that
the International Trade Commission affirmed and adopted the
ruling of Administrative Law Judge Paul Luckern that EchoStar
does not infringe the patents of Gemstar-TV Guide International
Inc., and the ITC has now closed its investigation of Gemstar's
ITC complaint.

The ITC also found that Gemstar's critical '121 patent was
unenforceable.

"We are pleased with the ITC's decision which vindicates
EchoStar's long-held position that its products do not infringe
Gemstar's patents," said David Moskowitz, senior vice president
and general counsel of EchoStar. "Although the ITC found it
unnecessary to take a position on the patent misuse issues, we
are also pleased they chose not to overturn Judge Luckern's
ruling which found Gemstar guilty of patent misuse."

The decision of the ITC is expected to be influential in related
district court actions where EchoStar will continue to defend
itself against Gemstar's allegations of patent infringement. In
addition, EchoStar will continue to pursue its antitrust and
patent misuse claims against Gemstar.

EchoStar Communications Corporation and its DISH Network
satellite TV system provide over 500 channels of digital video
and CD-quality audio programming, as well as advanced satellite
TV receiver hardware and installation nationwide. EchoStar is
included in the Nasdaq-100 Index. DISH Network currently serves
over 7.46 million customers. For more information, contact
800/333-DISH (3474) or visit http://www.dishnetwork.com

                         *    *    *

Echostar Communications' June 30, 2002 balance sheet shows a
total shareholders' equity deficit of about $827 million.


ENRON CORP: ENA Sues Tribune to Recover $22MM Termination Fee
-------------------------------------------------------------
Enron North America Corp., tells the Court that Tribune Company
failed to pay its debts under the financially settled swap
transaction involving the price of newsprint governed by the
International Swap Dealers Association, Inc., Master Agreement
dated August 21, 1997.

Melanie Gray, Esq., at Weil, Gotshal & Manges LLP, in New York,
relates that the parties further executed documents under the
Agreement:

  (a) Schedule and Credit Support Annex modifying certain terms
      of the Agreement, as well as setting forth the credit
      support terms of the Transactions; and

  (b) Confirmation Nos. EE3277.1, EL1181.1 AND EO1441.1,
      evidencing the specific terms and conditions of the
      Transactions for a period of five years:

      -- Confirmation No. EE3277.1 commenced on September 1,
         1997 and will expire on August 31, 2002;

      -- Confirmation No. EL1181.1 commenced on May 1, 1998 and
         will expire on April 30, 2002; and

      -- Confirmation No. EO1441.1 commenced on August 1, 1998
         and expire on July 31, 2003.

Ms. Gray continues that on December 11, 2001, Tribune notified
ENA that it is terminating the Transactions due to default, even
though ENA was performing its obligations under the
Transactions. The Termination Notice designated December 12,
2001 as the Early Termination Date.

Under the Agreement, Ms. Gray says, upon an Early Termination,
the future obligations due under the Confirmations are to be
valued against prevailing market prices.  To the extent the
Confirmations are priced above or below the market, the party
who benefits from the market differential is entitled to a
payment of the present value of the differential -- Forward
Value.

Also, pursuant to the Agreement, the non-defaulting party is to:

    (a) calculate the amount due under Section 6(e) of the
        Agreement as soon as reasonably practicable after the
        Early Termination Date; and

    (b) provide the Defaulting Party a statement showing the
        calculations.

However, Ms. Gray reports, Tribune has failed to calculate the
Termination Payment -- composed of the Transaction Payment and
the Forward Value -- either in its Termination Notice or at any
time thereafter.  Accordingly, ENA calculated the Termination
Payment and provided it to Tribune on June 13, 2002.  Based on
ENA's calculations, the Termination Payment is $22,928,365, both
for the Forward Value and the Transaction Payment.

However, Tribune failed to pay any portion of the Termination
Payment.  ENA asserts that due to breach of contract:

    (a) Tribune is required to pay to ENA the $22,928,365
        Termination Payment after the Early Termination Date;

    (b) Under the Agreement, Tribune is required to pay ENA the
        Transaction Payment of $2,543,060 when due since this
        constitutes a debt that is matured, payable on demand or
        payable on order; and

    (c) Tribute owes ENA a $20,385,305 Forward Value, which
        is due under the Agreement. (Enron Bankruptcy News,
        Issue No. 40; Bankruptcy Creditors' Service, Inc.,
        609/392-0900)

Enron Corp.'s 9.125% bonds due 2003 (ENRN03USR1) are trading at
11.5 cents-on-the-dollar, DebtTraders reports. See
http://www.debttraders.com/price.cfm?dt_sec_ticker=ENRN03USR1
for real-time bond pricing.


EXIDE: Asks Court to Reconsider Portions of Blackstone Order
------------------------------------------------------------
Judge Akard authorizes Exide Technologies and its debtor-
affiliates to employ Blackstone as Financial Advisor, provided,
however, that no restructuring or transaction fee will be paid
without prior approval by the Court. The restructuring fee will
be awarded only upon showing that Blackstone made a substantial
contribution to the transaction in question over and above the
contribution required by its monthly fee.  The $200,000 monthly
fee will be payable for the months of August 2002 through
November 2003, subject to the 30-day cancellation provisions
contained in the Letter Agreement.

Judge Akard deletes the Indemnity Agreement in its entirety.  
The Court rules that the Debtors will not indemnify Blackstone
because Blackstone is employed as a professional and must be
responsible for its actions.  The provisions calling for the
Debtors to pay Blackstone's attorney's fees are also deleted,
provided, however, that Blackstone can apply to the Court to
have the Debtors pay its attorney's fees in appropriate
circumstances.

Judge Akard directs the Debtors not to make any payments to
Blackstone until it has acknowledged its acceptance of its
employment on these terms.  Compensation to Blackstone will
commence on the date the Debtors receive written confirmation
with payment to be reduced on a pro rata basis for the remaining
days of that month.  If Blackstone does not file an acceptance
on or before August 30, 2002, its employment is denied.

                     Debtors Seek Reconsider

The Debtors ask the Court to reconsider portions of the
Blackstone Order pursuant to Rules 9023 and 9024 of the Federal
Rules of Bankruptcy Procedures because:

-- the change requested in the Motion in terms of
   indemnification is identical to the indemnification provision
   approved by this Court for the Committee's financial advisor,
   Jefferies & Company, Inc.;

-- there is no longer any dispute among the constituencies in
   these cases regarding Blackstone's retention; and

-- the Debtors believe they can incorporate the Court's concerns
   in a retention order which is acceptable to all parties.

Paragraph 2 of the Blackstone Order provides:  "Blackstone will
perform all of the duties described in the Letter Agreement.  
The $200,000 monthly fee will be payable for the months of
August 2002 through November 2003, but subject to the 30-day
cancellation provisions contained in the Letter Agreement."

Laura Davis Jones, Esq., at Pachulski Stang Ziehl Young & Jones,
P.C., in Wilmington, Delaware, notes that no party objected to
the proposed commencement date or termination date of
Blackstone's employment.  The Debtors seek reconsideration of
Paragraph 2 of the Blackstone Order because it limits the term
of Blackstone's retention and could have the effect of depriving
the Debtors of access to a financial advisor during a crucial
time in these cases and will have the effect of depriving
Blackstone of compensation from April 15 through July 2002.  
Blackstone would otherwise be entitled to $700,000 compensation
plus reimbursement for expenses incurred in that period.

Ms. Jones recounts that the Debtors filed the Application on May
31, 2002 and sought retention of Blackstone effective as of the
Petition Date.  Since the Petition Date, Blackstone has been
negotiating with the Committee and the Steering Committee of the
Prepetition Secured Lenders regarding:

-- the retention, corporate incentive and income protection
   plans approved by the court on July 30, and

-- the terms of its retention.

Ms. Jones adds that Blackstone has been performing its other
duties under the Letter Agreement including spending a
significant amount of time evaluating the divestiture of one of
the Debtors' business units, which may be crucial to the
Debtors' successful reorganization.  Blackstone should not be
penalized for performing services for the Debtors while
negotiating the terms of its retention with the constituents in
these cases.

Paragraph 5 of the Blackstone Order provides: "Blackstone is
being employed as a professional and must be responsible for its
actions.  Consequently, the Indemnity Agreement is deleted in
its entirety and the Debtors will not indemnify Blackstone.  The
provisions of the Letter Agreement calling for the Debtors to
pay Blackstone's attorneys' fees are deleted; provided, however,
nothing in this order will prohibit Blackstone from making an
application to this court to have the Debtors pay its attorneys;
fees in appropriate circumstances."

The Debtors also seek reconsideration of Paragraph 5 of the
Blackstone Order to provide for indemnification for Blackstone.
Pursuant to its agreement with the U.S. Trustee, Blackstone
agreed to limit the indemnification provisions under these
terms:

A. subject to the provisions of subparagraph (C), the Debtors
   are authorized to indemnify, and will indemnify, Blackstone
   in accordance with the terms of the Letter Agreement, for any
   claim arising from, related to, or in connection with
   Blackstone's engagement, but not for any claim arising from,
   related to, or in connection with Blackstone's postpetition
   performance of any services other than those in connection
   with the engagement, unless these postpetition services and
   indemnification therefore are approved by the Court;

B. notwithstanding any provision of the Letter Agreement to the
   contrary, the Debtors will have no obligation to indemnify
   Blackstone, or provide contribution or reimbursement to
   Blackstone, for any claim or expense that is either:

   -- judicially determined to have arisen solely from
      Blackstone's bad faith, gross negligence or willful
      misconduct, or

   -- settled prior to a judicial determination as to
      Blackstone's bad faith, gross negligence or willful
      misconduct, but determined by the Court, after notice and
      a hearing, to be a claim or expense for which Blackstone
      is not entitled to receive indemnity, contribution or
      reimbursement under the terms of the Letter Agreement as
      modified by the Order;

C. if, before the earlier of:

   -- the entry of an order confirming a Chapter 11 plan in
      these cases, and

   -- the entry of an order closing these Chapter 11 cases,

   Blackstone believes that it is entitled to the payment of
   ally amounts by the Debtors on account of the Debtors'
   indemnification, contribution and reimbursement obligations
   under the Letter Agreement, including the advancement of
   defense costs, Blackstone must file an application in this
   Court, and the Debtors may not pay any amounts to Blackstone
   before the entry of an order by the Court approving the
   payment.  This subparagraph is intended only to specify the
   period of time under which the Court will have jurisdiction
   over any request for fees and expenses by Blackstone for
   indemnification, contribution or reimbursement and not as a
   provision limiting the duration of the Debtors' obligation to
   indemnify Blackstone; and

D. the United States Trustee will have the right to object to
   the indemnification provisions approved if, during the
   Debtors' cases, the United States Court of Appeals for the
   Third Circuit issues a ruling with respect to the appeal from
   the decision of the United States District Court for the
   District of Delaware with respect to indemnification rights
   In re United Artists Theatre Company, et al., Case No. 00-
   3514 (SLR); provided that the United States Trustee will be
   required to file any objection within 120 days after the
   date the United States Court of Appeals for the Third Circuit
   issues a ruling; provided, further, that in the event of
   any objection, nothing herein will shift or otherwise
   alter the applicable burden of proof with respect to the
   indemnification provisions and, further provided, that if the
   United States Trustee appeals any decision to the United
   States Supreme Court, Blackstone agrees to be bound by any
   decision of the United States Supreme Court on this issue.

Ms. Jones points out that the indemnification provisions were
agreed to by Blackstone and the United States Trustee and are
identical to those agreed to by Jefferies and approved by this
Court in the Jefferies Order.  The Debtors assert that it is
inequitable to require the Debtors' financial advisor to work
without any indemnification while the Debtors have provided
indemnification to the Committee's financial advisor.  The
Debtors are prepared to offer limited indemnification to both
financial advisors under the terms which have been agreed to by
the United States Trustee in these cases and which have been
approved by this Court in the case of Jefferies.

Ms. Jones tells the Court that Blackstone has never accepted an
engagement, in or out of court, without indemnification and it
could not continue here without indemnification in the form of
the proposed Order.  Indemnification is essential to Blackstone
for these reasons:

A. Unlike attorneys, who are generally immune from discovery or
   being sued for their actions while representing a debtor,
   Blackstone is exposed to the risk of litigation and related
   expenses once it undertakes to represent a debtor.  This
   litigation may be meritless and may be unrelated to the
   quality of Blackstone's work; and

B. By requiring indemnification from the estate, Blackstone
   obtains a significant measure of protection against parties-
   in-interest acting in bad faith toward it.  Bankruptcy is a
   litigious environment and parties-in-interest who are
   sustaining losses on their investments have been known to
   lash out at deep pockets in the hope of extracting a few
   additional percentage points in their recovery, especially
   when a case turns out unsuccessfully from their perspective.  
   Without indemnification, Blackstone could be forced to incur
   substantial expense to defend itself and might lose money by
   virtue of representing a debtor even if its work was beyond
   reproach.  There is no risk that Blackstone will receive
   indemnification improperly because the proposed Order makes
   all indemnification payments subject to review and approval
   by tile Court before they are made and the indemnification
   arrangements contain customary exceptions that excuse payment
   where there has been misconduct by the advisor.

If not reconsidered, Ms. Jones fears that the Court's order
could have the unintended effect of leaving the Debtors without
a financial advisor.  It is very unlikely that the Debtors would
be able to retain a financial advisor of Blackstone's expertise,
which would be willing to work without indemnification.

Paragraph 6 of the Blackstone Order provides: "The Debtors will
not make any payments to Blackstone until Blackstone has
acknowledged in writing to the Debtors and filed with the Clerk
of this court its acceptance of its employment on the terms of
this order.  The Blackstone's employment will be considered
effective upon the Debtors' receipt of written notification from
Blackstone.  Compensation to Blackstone will commence on the
date the Debtors received that written confirmation with the
payment for the month in which it is received to be reduced on a
pro rata basis for the remaining days of that month.  If
Blackstone does not file an acceptance on or before August 30,
2002, then is employment will be denied."

While the Court intended this paragraph to protect the Debtors
by having Blackstone consent in writing to the revised terms of
its engagement, Ms. Jones notes that this paragraph would put
the commencement date of Blackstone's retention at no earlier
than August 2002.  Given the April 15, 2002 Petition Date, this
means that Blackstone would not be paid for 3 and 1/2 months of
work amounting to $700,000 plus reimbursement of expenses for
the same period during which Blackstone rendered valuable
services.

The Debtors assert and Blackstone has agreed to be governed by
this Court's order as modified by this reconsideration request.
If the Court requests, Blackstone will file a written
confirmation of its acceptance of the terms of its retention as
modified. (Exide Bankruptcy News, Issue No. 9; Bankruptcy
Creditors' Service, Inc., 609/392-0900)

  
FEDERAL-MOGUL: Equity Committee Turns to Deloitte for Advice
------------------------------------------------------------
The Official Committee of Equity Holders of Federal-Mogul
Corporation and its debtor-affiliates, seeks the Court's
authority to retain Deloitte & Touche LLP as consultant and
financial advisor in these Chapter 11 cases, effective July 12,
2002.

The Equity Committee asserts that it is entitled to a level
playing field, which can be achieved by permitting it access to
independent assistance in the analysis of the Debtors' financial
conditions, business plan, and asbestos liabilities, together
with the advocacy of the interest of Equity Security Holders.

"The Debtors cannot be expected to advocate the Equity
Committee's positions or to share internal work product and
analysis," according to Megan N. Harper, Esq., at Bifferato,
Bifferato & Gentilotti, in Wilmington, Delaware.  Without at
least one independent financial advisor of its own, the Equity
Committee will not be able to negotiate with well-informed and
well-funded parties on an equal basis.  Nor will it be in a
position to adequately articulate its arguments on the ultimate
issues to the Court.

Specifically, Deloitte is expected to:

(a) Assist and advise the Equity Committee in its consultations
    with the Debtors and other statutory committees regarding
    the administration of the cases;

(b) Assist and advise the Equity Committee in connection with
    its investigation of the financial condition of the Debtors
    and their affiliates, the operation of the Debtors'
    businesses and other matters relevant to the case or to the
    formulation of a reorganization plan;

(c) Assist the Equity Committee in connection with its
    evaluation of any valuations prepared by the Debtors and
    other statutory committees and in performing any alternative
    valuation calculations;

(d) Assist the Equity Committee in connection with the
    formulation or negotiation of a reorganization plan;

(e) Assist the Equity Committee in connection with the analysis
    of the Debtors' asbestos liabilities;

(f) Assist the Equity Committee in the analysis of the Debtors'
    business plan;

(g) Assist the Equity Committee in analyzing other reports or
    analysis prepared by the Debtors or its professionals;

(h) Assist the Equity Committee in analyzing the financial
    ramifications of any proposed transactions for which the
    Debtors seek Bankruptcy Court approval;

(i) As deemed appropriate by Deloitte and the Equity Committee,
    attend and advise at meetings with the Equity Committee and
    its counsel and representatives of the Debtors and other
    interested parties;

(j) As deemed appropriate by Deloitte and the Equity Committee,
    render expert testimony on behalf of the Equity Committee;
    and

(k) Provide other necessary services, as may be requested by the
    Equity Committee and as agreed by Deloitte.

The Debtors will compensate Deloitte for its services with a
fixed monthly fee not to exceed $200,000 per month for the first
five months of its engagement.  Deloitte will be paid $125,000
per month for the subsequent periods.  Deloitte will also be
entitled to reimbursement of actual and necessary expenses.

Ms. Harper adds that, in the event that, at the time of
submitting the monthly fee applications, the aggregate fixed
monthly fees for the current and prior months are greater than
the total of time actually expended -- by all individuals
providing services to the Committee -- multiplied by the billing
rates for those individuals, Deloitte will voluntarily reduce
its monthly fee by the excess.  The firm's standard hourly
billing rates are:

              Partner             $550 - 650
              Senior Manager       475 - 550
              Manager              425 - 475
              Senior Consultant    325 - 375
              Consultant           250 - 300
              Paraprofessional     100 - 150

Bernard Pump, a partner of Deloitte & Touche LLP, assures Judge
Newsome that Deloitte is a "disinterested person", as defined in
Section 101(14) of the Bankruptcy Code.  In addition, Deloitte
holds no adverse interest against the Debtors or their estates.

Mr. Pump also lists entities, or their affiliates, successors,
or predecessors, for which Deloitte or its affiliates have
provided or are currently providing services, or with whom
Deloitte has other relationships, in matters unrelated to these
Chapter 11 cases: A.G. Edwards Inc. (the parent of Ceres II
Finance); ABN Amro Holding NV; Alliance Capital Funding L.L.C.;
Amara-1 Finance Ltd.; Amara-2 Finance Ltd.; AIG Global
Investment Corp. C130-3; American International Group; AON Risk
Services; American Parts System; Associated Aviation
Underwriters; Avalon Capital Ltd.; Avalon Capital Ltd. 11; Banco
Espirito Santo; Bank of America; Bank of Montreal; Bank of New
York; Bank of Nova Scotia; Bank of Tokyo-Mitsubishi Trust Co.;
Bank One/NBD Bank; Bayerishe Hypo and Vereinsbank AG; Bear
Steams & Co. Inc.; Bell, Boyd & Lloyd; BNP Paribas; Bryan Cave
LLP; Caplin & Drysdale; Captiva III Finance, Ltd.; Captiva IV
Finance, Ltd.; Chang Hwa Commercial Bank, Ltd.; Chase Manhattan
Bank USA, NA; Chubb Insurance Group; Citicorp USA Inc.; Citizens
Bank of Massachusetts; Comerica Bank; Commerzbank AG; Compagnie
Financier; Constitution States (a subsidiary of
TravelersPropertyCasualty); Credit Agricole Indosuez; Credit
Lyonnais; Credit Suisse First Boston; Cummins Corporation;
Cypress Tree Investment Partners I; Cypress Tree Investment
Partners II; Dai-ichi Kangyo Bank; David Morris Wilson; Delano
Technology Corp.; Dresdner Bank AG; Dykema Gossett PLLC; Eaton
Vance Institutional; Ernst & Young LLP; Ernst & Young Capital
Advisors LLC; Erste Bank; Federal-Mogul Corporation; First
Commercial Bank; First Hawaiian Bank; First Union National Bank;
Fleet Boston Financial; Foothill Income Trust, LP; Fuji Bank
Limited; and Galaxy CLO.

Other interested parties include: General Electric Company;
Gibbons, Del Deo, Dolan, Griffinger & Vecchione; Golden Tree HY
Opportunities 1, LP; Goldentree High Yield Master Fd, Ltd.;
Goldman Sachs Credit Partners, L.P.; Greenberg Traurig; HSBC
Bank USA HSBC Bank plc; Icahn & Company; Industrial Bank of
Japan; Jackson National Life Insurance; John W. Richmond; KBC
Bank N.V.; KPMG; Liberty Mutual; Lloyds TS13 Bank, PLC; Lockheed
Aircraft Corporation; Marsh & McLennan Companies; Mellon Bank
N.A.; ML CLO XV Pilgrim Cayman; ML CLO XX Pilgrim America
(Cayman); Monument Capital Ltd.; Monumental Life Insurance
Company; National City Bank; National Westminster Bank; NTN
Corporation; Nuveen Floating Rate Fund; Nuveen Senior Income
Fund Ohio Bureau of Workers Compensation; Pachulski, Stang,
Ziehl Young & Jones; Paul S. Lewis; Pilgrim CLO;
PricewaterhouseCoopers; Putnam High Yield Trust; Putnam High
Yield Trust II; Putnam Variable Trust; R.R. Donnelley & Sons
Company; Regions Bank; Richard M. Green; Robert S. Miller, Jr.;
Royal Bank of Scotland; Sidley Austin Brown & Wood; Societe
Generale; South Bend Lathe, Inc.; State Street Bank & Trust;
Swiss Re; The Bayard Firm; The Budd Company;
TravelersPropertyCasualty; U.S. Bank Trust N.A.; Van Kampen
Prime Rate Interest Rate; Van Kampen Senior Income Trust; Van
Kampen Sr. Floating Rate Fund; Wachovia Bank N.A.; Webster Bank;
Willis Coroon of Wisconsin; and Zermatt CBO Limited.

            Creditors' Committee Seeks Fee Reduction

The Official Committee of Unsecured Creditors objects to the
retention of Deloitte & Touche for two reasons:

    (1) there is no value for equity, and
    (2) Deloitte has a conflict of interest.

Eric M. Sutty, Esq., at The Bayard Firm, in Wilmington,
Delaware, tells Judge Newsome that the Debtors' estimated
commercial debt obligations and unsecured claims, exclusive of
asbestos personal property and personal injury claims --
assuming the surety bonds are fully drawn and funded are:

              Obligations                 Amount
              -----------                 ------
              Bank Debt
                 DIP Facility             $250,000,000
                 Term Loan C               345,000,000
                 Revolver                1,636,000,000
              Surety Bonds                 225,000,000
              Bond Debt                  2,116,000,000
              Convertible Debt             449,000,000
              Trade Payables               300,000,000
              Admin & priority claims      400,000,000
                                        --------------
              TOTAL                     $5,721,000,000

Mr. Sutty reports that the Asbestos Committee has asserted the
Debtors' asbestos liability to be significantly over
$1,600,000,000.  On the other hand, the Debtors reported a
$495,000,000 EBITDA for the year ended December 31, 2001 and
$444,000,000 for the last twelve months ended June 30, 2002.

Based on these figures, there is no present value available for
equity.  "Not that it is dispositive of values, but we note that
the bank debt is currently trading at 60 cents on the dollar,
and the bond debt is currently trading at 24 cents on the
dollar," Mr. Sutty says.  Given that, Deloitte's retention would
generate a costly and unwarranted expense for the Debtors'
estates, besides being excessive.  Deloitte will be paid
$200,000 per month compared to the Creditors' Committee's
financial advisor at $125,000 a month.

Additionally, Mr. Sutty relates that, when the Creditors'
Committee sought to retain Deloitte, the Creditors' Committee
was advised by Deloitte that that the firm could not accept the
engagement because of their conflicts.  Deloitte Consulting in
Germany, an affiliate of Deloitte, assisted Federal-Mogul
Holding Germany -- a non-debtor subsidiary of the Federal-Mogul
Corporation -- from January 2000 through October 2001 with the
implementation of an accounting services center and certain
software applications in France.  Also, Deloitte Consulting in
the United States provided limited scope SAP-related services
for a subsidiary of Federal-Mogul Corporation.

"No explanation is given by Deloitte why a perceived conflict
that precluded them from accepting an assignment from the
Creditors' Committee does not similarly preclude them from now
representing the Equity Committee," Mr. Sutty concludes.

If the Court authorizes the Equity Committee to retain a
financial advisor, the Creditors' Committee insists that the cap
on fees should be materially less than the $200,000 per month
requested.  Moreover, the Equity Committee should not be
authorized to retain Deloitte absent any demonstration that the
firm does not have a disqualifying conflict. (Federal-Mogul
Bankruptcy News, Issue No. 22; Bankruptcy Creditors' Service,
Inc., 609/392-0900)


GALEY & LORD: Has Until Dec. 17 to Make Lease-Related Decisions
---------------------------------------------------------------
By order of the U.S. Bankruptcy Court for the Southern District
of New York, Galey & Lord, Inc., and its debtor-affiliates
obtained an extension of their lease decision period.  The Court
gives the Debtors until December 17, 2002, to decide whether to
assume, assume and assign, or reject their unexpired
nonresidential real property leases.

G&L, a leading global manufacturer of textiles for sportswear,
including cotton casuals, denim, and corduroy, and is a major
international manufacturer of workwear fabrics, filed for
chapter 11 protection on February 19, 2002 together with its
affiliates. When the Company filed for protection from its
creditors, it listed $694,362,000 in total assets and
$715,093,000 in total debts.  Michael J. Sage, Esq., at Stroock
& Stroock & Lavan LLP, represents the Official Committee of
Unsecured Creditors.


GEMSTAR-TV: Wants to Appeal Int'l Trade Commission Decision
-----------------------------------------------------------
Gemstar-TV Guide International, Inc., (Nasdaq:GMSTE) received
notice that the United States International Trade Commission has
declined to review the June 21, 2002 decision of its
Administrative Law Judge pertaining to three of the Company's
patents. The Commission also entered an additional finding with
regard to the technical prong of the domestic industry
requirement on one claim of one of the patents.

In the earlier decision, the Administrative Law Judge found that
there had been no infringement of those patents by EchoStar
Communications Corporation, Pioneer Corporation, Pioneer Digital
Technologies, Inc., Pioneer New Media Technologies, Inc.,
Pioneer North America, Inc., Scientific-Atlanta Inc., and SCI
Systems, Inc., and that the Company had misused one of the three
patents, which was also found to be unenforceable for failure to
name a co-inventor. The Commission took no position as to the
Administrative Law Judge's misuse findings. The Commission also
did not disturb the Administrative Law Judge's determination
regarding the validity of the patents.

The Company announced that it intends to appeal the decision to
the United States Court of Appeals for the Federal Circuit. The
company is currently pursuing these and other additional patents
in proceedings in the U.S. District Court in Atlanta against the
same parties.

                              *    *    *

As reported in Troubled Company Reporter's August 20, 2002
edition, Standard & Poor's Ratings Services placed its ratings,
including its double-'B'-plus corporate credit rating, on
Gemstar-TV Guide International Inc., on CreditWatch with
negative implications, based on the company's announcement that
it is delaying the release of its 2002 second-quarter earnings
and filing of its Form 10-Q with the SEC, and that the company
is reviewing how it recognizes revenue. Pasadena, California-
based Gemstar also reported it is restating its 2001 financial
results to reverse a nominal amount of revenue recognized at its
TV Guide subsidiary. Total debt outstanding at March 31, 2002,
was about $302.7 million.

"Standard & Poor's believes the disclosure heightens concerns
about the company's reported financial results and escalating
investor uncertainty", said Standard & Poor's credit analyst
Alyse Michaelson. She added that, "The ratings are already
vulnerable to mounting business risk. Recent announcements of an
ongoing review of how advertising was recorded and allocated,
and the potential for management instability, exert further
downward pressure on the ratings despite adequate cash
resources."


GLOBAL CROSSING: Asks Court to Approve Settlement with Sonus
------------------------------------------------------------
Pursuant to various agreements, Michael F. Walsh, Esq., at Weil
Gotshal & Manges LLP, in New York, relates that Sonus Networks
Inc., provides Global Crossing Ltd., and its debtor-affiliates
with equipment, software and maintenance support for its carrier
class voice over IP network. Sonus has aided the Debtors in
reducing operating expenses and decreasing the need for certain
capital investment due to the new architecture using any-to-any
voice over packet central office switch and call management.  
The Debtors regard Sonus as a strategic vendor going forward due
to the large network embedded base that it developed.

Sonus asserts claims against the Debtors for $2,800,000 in the
aggregate, including administrative expense claims and claims
having priority or preference against certain non-Debtor
affiliates.  The Debtors dispute the existence, amount, extent
and priority of Sonus' claims.

The salient terms of the Sonus Settlement Agreement are:

A. Parties:  Global Crossing Ltd., GC North American Networks;
   GC Holdings; Global Crossing Telecommunications, Inc.; GC PEC
   Switzerland GmbH; GC Network Centre (UK) Ltd. - PEC ROC; GC
   PEC Espana S.L.; GC PEC Nederland B.V.; GC PEC Sverige
   Aktiebolag; GC PEC Italia S.R.L.; GC PEC Deutschland GmbH;
   and Sonus Networks, Inc.;

B. European Debt Payment by Global Crossing to Sonus:  
   $1,192,466 payable in monthly installments by various
   European Global Crossing parties to be completed by December
   15, 2002;

C. Capex Commitment:  By no later than December 31, 2002, the
   Debtors will issue purchase orders that equal $150,000 in the
   aggregate, pursuant to the purchase and license agreement,
   dated as of May 1, 2000 between Sonus and Global Crossing
   North America, Inc.;

D. Support Services Payments:  Pursuant to the services
   agreement, dated as of May 1, 2000 between Sonus and GC North
   America, GC North America will make these payments to Sonus:

    -- $368,508.07 by June 30, 2002,

    -- $379,508.08 by July 15, 2002 and

    -- $732,284.24 by October 31, 2002;

E. Global Crossing Release:  As of the Effective Date, the
   Debtors release Sonus from all claims relating to the Sonus
   Agreements;

F. Sonus Release:  As of the Effective Date, Sonus releases the
   Debtors from all claims relating to the Sonus Agreements; and

G. Assumption of Executory Contracts:  The Debtors will assume
   these Sonus Agreements, as provided in the Sonus Settlement
   Agreement, provided that no payments will be required in
   connection with the assumption:

   -- Purchase and License Agreement;

   -- Services Agreement; and

   -- the Master Preferred Escrow Agreement, dated March 5,
      2002, between Sonus, GC North America and DSI Technology
      Escrow Services, Inc. (Global Crossing Bankruptcy News,
      Issue No. 19; Bankruptcy Creditors' Service, Inc.,
      609/392-0900)


GLOBAL CROSSING: Reports Net Loss of $145 Million for July 2002
---------------------------------------------------------------
Global Crossing reported that its financial performance remains
on-track, and that it continues to meet year-to-date targets
outlined in its operating plan for service revenue, cash in bank
accounts, operating expenses, third-party maintenance and
service EBITDA (earnings before interest, taxes, depreciation,
and amortization).  The performance targets were established for
Global Crossing (excluding Asia Global Crossing) in the
operating plan presented to its creditors in March.

Consolidated results for the month of July that include Asia
Global Crossing and that are reported in the Monthly Operating
Report filed with the U.S. Bankruptcy Court in the Southern
District of New York are summarized later in this press release.

                         Operating Results
                  (excluding Asia Global Crossing)

In July 2002, Global Crossing reported $231 million in service
revenue, $6 million above the service revenue target set forth
in the operating plan. Service EBITDA was reported at a loss of
$12 million, a loss $6 million greater than the July 2002
operating plan target. Year-to-date Service EBITDA continues to
exceed the target in the operating plan.

"In July 2002, our team continued to work towards the goals we
have outlined for ourselves and our creditors in the operating
plan," said John Legere, CEO of Global Crossing. "Now that our
future has been defined with our new investors, Hutchison
Telecommunications and Singapore Technologies Telemedia, we can
turn our complete attention to emerging from Chapter 11 as a
strong, healthy competitor - one that attracts new customers in
addition to retaining its current customer base."

Total cash in bank accounts beat targets set forth in the
operating plan, with $797 million as of July 31, 2002, compared
to a plan of $676 million. Operating expenses were $63 million
in July 2002, $3 million higher than the target in the operating
plan, while third-party maintenance costs were reported at $12
million, beating the operating plan target by $3 million.

                  MOR Results for July 2002

Global Crossing filed a Monthly Operating Report (MOR) for the
month of July with the U.S. Bankruptcy Court for the Southern
District of New York, as required by its Chapter 11
reorganization process.  These consolidated results in this MOR
include Asia Global Crossing and revenue from sales of capacity
in the form of IRUs (indefeasible rights of use) that occurred
in prior periods, recognized ratably over the life of the
relevant contracts.

Results reported in the July MOR include the following:

For continuing operations in July 2002, Global Crossing reported
consolidated revenue of approximately $249 million.  
Consolidated operating expenses were $75 million, while access
and maintenance costs were reported at $193 million in June
2002.

In addition, Global Crossing reported a consolidated GAAP
(Generally Accepted Accounting Principles) cash balance of
approximately $1,125 million as of July 31, 2002, including $366
million of cash held by Asia Global Crossing.  Global Crossing's
$759 million GAAP cash balance (excluding Asia) is comprised of
$376 million unrestricted cash, $333 million in restricted cash
and $50 million of cash held by Global Marine.

Global Crossing reported a consolidated net loss of $145 million
for July 2002.  Consolidated EBITDA was reported at a loss of
$19 million.

As discussed more fully in these MORs, Global Crossing has not
yet filed its Annual Report on Form 10-K for the year ended
December 31, 2001. Global Crossing has agreed with the
Creditors' Committee in its Bankruptcy proceeding and with the
United States Trustee to the appointment of an examiner in the
Chapter 11 cases, whose role will consist of an examination of
the financial statements of Global Crossing and companies within
its control. The examination will include, (i) issuing an audit
opinion on Global Crossing's financial statements for the year
ended December 31, 2001, (ii) determining if any restatements or
adjustments of previously filed financial statements are
required (including those that may be required in light of the
August 2, 2002 notification by the staff of the Office of the
Chief Accountant of the SEC regarding accounting for exchanges
of telecommunications capacity under APB Opinion No. 29,
Accounting for Non Monetary Transactions) and (iii) issuing a
report regarding its findings.  Global Crossing's Board of
Directors is currently seeking to retain a new independent
public accounting firm to act as its new auditor, and it is
expected that the new accounting firm would also act as the
examiner in the Bankruptcy proceeding.

In addition, certain matters relating to Global Crossing's
accounting for, and disclosure of, concurrent transactions for
the purchase and sale of telecommunications capacity between
Global Crossing and its carrier customers are being investigated
by the U.S. Securities and Exchange Commission, the U.S.
Attorney's Office for the Central District of California, the
House of Representatives Financial Services Committee and the
House of Representatives Energy & Commerce Committee. Global
Crossing is also cooperating with a similar inquiry being
conducted by the Denver office of the SEC regarding another
telecommunications company, and has provided documents in
response to a subpoena it received from the New York Attorney
General Office's relating to an investigation of Salomon Smith
Barney. The U.S. Department of Labor is conducting an
investigation into the administration of Global Crossing's
benefit plans.  These investigations are described more fully in
the July MOR.

Any changes to the financial statements resulting from any of
these investigations and the completion of the 2001 financial
statement audit could materially affect the unaudited
consolidated financial statements contained in these MORs and
the information presented in this press release.

As previously announced, Global Crossing's net loss for the
three months ended December 31, 2001 is expected to reflect the
write-off of the remaining goodwill and other intangible assets,
which total approximately $8 billion. Furthermore, in light of
the terms contained in the previously announced agreement with
Hutchison Telecommunications and Singapore Technologies
Telemedia, Global Crossing has determined that it will write
down its tangible assets by at least $10 billion. The financial
information included within this press release and the MORs
reflect the write-off of all of the goodwill and other
identifiable intangible assets of $8 billion, but does not
reflect any write-down of tangible asset value. Global Crossing
is currently in the process of evaluating its financial
forecasts to determine the impairment of its long-lived assets.  
In addition, Global Crossing will write down Asia Global
Crossing's interest in Hutchison Global Crossing by $450
million, representing the difference between the proceeds
received and the carrying value of Asia Global Crossing's
interest in Hutchison Global Crossing, which was sold on April
30, 2002.  The write-off of the intangible assets, and the
write-downs of tangible assets are described more fully in the
July MOR.

Global Crossing provides telecommunications solutions over the
world's first integrated global IP-based network, which reaches
27 countries and more than 200 major cities around the globe.  
Global Crossing serves many of the world's largest corporations,
providing a full range of managed data and voice products and
services.  Global Crossing operates throughout the Americas and
Europe, and provides services in Asia through its subsidiary,
Asia Global Crossing.

On January 28, 2002, Global Crossing and certain of its
affiliates (excluding Asia Global Crossing and its subsidiaries)
commenced Chapter 11 cases in the United States Bankruptcy Court
for the Southern District of New York (Bankruptcy Court) and
coordinated proceedings in the Supreme Court of Bermuda. On the
same date, the Bermuda Court granted an order appointing joint
provisional liquidators with the power to oversee the
continuation and reorganization of the Bermuda-incorporated
companies' businesses under the control of their boards of
directors and under the supervision of the U.S. Bankruptcy Court
and the Supreme Court of Bermuda. On April 23, 2002, Global
Crossing commenced a Chapter 11 case in the Bankruptcy Court for
its affiliate, GT UK, Ltd. On August 4, 2002, Global Crossing
commenced a Chapter 11 case in the United States Bankruptcy
Court for the Southern District of New York for its affiliate,
SAC Peru Ltd. On August 30, 2002, Global Crossing commenced
Chapter 11 cases in the Bankruptcy Court for an additional 23 of
its affiliates (as specified in the July MOR) in order to
coordinate the restructuring of those companies with its
restructuring.  Global Crossing expects to file coordinated
insolvency proceedings in the Bermuda Court for those affiliates
that are incorporated in Bermuda.  These cases are expected to
be consolidated with the existing cases commenced in Bankruptcy
Court on January 28, 2002.  Global Crossing does not expect that
the plan of reorganization, which it expects to file with the
Bankruptcy Court on or about September 16, 2002, would include a
capital structure in which existing common or preferred equity
would retain any value.

Please visit http://www.globalcrossing.comor  
http://www.asiaglobalcrossing.comfor more information about  
Global Crossing and Asia Global Crossing.

Global Crossing Holdings Ltd.'s 9.625% bonds due 2008
(GBLX08USR1), DebtTraders says, are trading at about 1.25. See
http://www.debttraders.com/price.cfm?dt_sec_ticker=GBLX08USR1
for real-time bond pricing.


GREAT AMERICAN: S&P Assigns BB+ Preferred Share Ratings
-------------------------------------------------------
Standard & Poor's Ratings Services assigned its preliminary
triple-'B' senior debt, triple-'B'-minus subordinated debt, and
double-'B'-plus preferred stock ratings to Great American
Financial Resources Inc.'s recently filed $250 million universal
shelf registration.

GAFRI is a holding company that markets retirement products--
primarily fixed and variable annuities--and various forms of
life and supplemental health insurance through its subsidiaries.
GAFRI's ultimate parent, American Financial Group Inc., is a
Cincinnati-based insurance holding company.

The ratings are based on the good business position of AFG,
GAFRI's ultimate parent. AFG is one of the 30 largest
property/casualty insurers and one of the top five writers of
nonstandard automobile coverage in the U.S. AFG's life
subsidiaries also have a strong business position in the
qualified annuity market and a small but growing position in
life and supplemental health. In addition, the group benefits
from a good (albeit diminished) capital position.

"Partially offsetting these factors is AFG's operating
performance and marginal interest coverage over the last two
years, which are lower than they had been historically,
primarily because of poor operating performance at the group's
property/casualty subsidiaries," explained Standard & Poor's
credit analyst Laline Carvalho. "However, Standard & Poor's
expects operating results and interest coverage to improve
substantially in 2002 and 2003." As of June 30, 2002, AFG's
property/casualty segment already showed improvement, with a
GAAP combined ratio of 101% for the first six months of the
year.

The current shelf registration replaces a previous shelf filed
by GAFRI in 2001. Standard & Poor's expects that any potential
drawdowns on the shelf will have no material impact on the
group's financial leverage, which is expected to remain at
current levels or lower.

Standard & Poor's expects AFG's property/casualty division to
report combined ratios in the 101%-104% range in 2002. Combined
with expected continued strong earnings at the life division,
interest coverage at the holding company is also expected to
improve to 3 times - 5x for full-year 2002. Consolidated capital
adequacy is expected to be in the 140% range. Financial leverage
is expected to remain within the rating range, with total debt
to total capital at about 33% and total debt-plus-preferred to
total capital at about 43%.


HORSEHEAD INDUSTRIES: Look for Schedules & Statements on Oct. 3
---------------------------------------------------------------
The U.S. Bankruptcy Court for the Southern District of New York
gave Horsehead Industries, Inc., and its debtor-affiliates, an
extension of time to file their schedules of assets and
liabilities and statement of financial affairs.  The Court gives
the Debtors until October 3, 2002 to complete their Schedules
and Statements, pursuant to 11 U.S.C. Sec. 521(1) and Rule 1007
of the Federal Rules of Bankruptcy Procedure.  

Horsehead Industries, Inc., d/b/a Zinc Corporation of America,
the largest zinc producer in the United States, filed for
chapter 11 protection on August 19, 2002 at Southern District of
New York. Laurence May, Esq., at Angel & Frankel, PC represents
the Debtors in their restructuring efforts. When the Company
filed for protection from its creditors, it listed $215,579,000
in assets and $231,152,000 in debts.


INSCI: Files Form 10-KSB/A for Fiscal Year Ended March 31, 2002
---------------------------------------------------------------
INSCI Corp. (OTC Bulletin Board: INSS), a leading supplier of
Electronic Statement Presentment, Integrated Document Archive
and Retrieval Systems and Enterprise Report Management (ERM)
software, announced it has filed with the Securities and
Exchange Commission the Company's audited financial statements
on Form 10-KSB/A for its fiscal year ended March 31, 2002.  
According to President and CEO Henry F. Nelson, the audited
statements show that the Company posted its third consecutive
quarter of profitability.

INSCI also announced that effective with the open of the market
on August 29, 2002, its Common Stock once again trades under the
symbol INSS.

In May of this year, INSCI dismissed Arthur Andersen as its
independent auditor and retained New York City-based Goldstein
and Morris.  The SEC had previously implemented release number
33-8070 for Arthur Andersen clients that were unable to or
elected not to obtain a manually signed audit report.  The
release provided in part that a company could have an additional
60-days to file audited year-end results.  There was no material
change in the audited financial statements filed with the SEC
pursuant to the Release from the unaudited results the Company
announced and filed in July.

Nelson commented, "We are particularly pleased to have been able
to redirect the Company and report a profitable year.  By
completing three consecutive quarters of profitability in a
difficult business climate, we believe INSCI is now well
positioned for future growth."

The audited results for the fiscal year ended March 31, 2002,
showed that revenues were $8.5 million with net income
applicable to common shareholders of $155,000, and that prior to
preferred stock dividends, net income for the 2002 fiscal year
was $368,000.  This compares to revenues of $10.0 million with a
net loss applicable to common shareholders of $17.8 million for
the 2001 fiscal year.  Fiscal year 2001 results included a non-
recurring restructuring charge of $8.9 million related to the
Company's portal services strategy and the closure of its
InfiniteSpace.com subsidiary.

Revenues for the 2002 fiscal year's fourth quarter were $1.8
million with net income applicable to common shareholders of
$246,000 compared to revenues of $1.9 million with a net loss of
$2.7 million for the prior year period.  Product revenues
declined year-over-year as a result of operations that have been
discontinued or sold as the Company refocused on its core
competencies and as a result of the slowdown of the general
economy.

"We are pleased to have completed our annual audit within the
extension guidelines mandated by the SEC.  Although it was a
real challenge to change auditors and complete the audit within
the time required, the diligence of our staff and new auditors
made it possible," Nelson added.

INSCI Corp., is a leading-provider of highly scalable digital
document repository solutions that provide high-volume document
presentment, preservation, and delivery functions via networks
or the Internet.  Its award-winning products bridge value
documents with front-office mission critical and customer-
centric applications by web-enabling legacy-generated reports,
bills, statements and other documents.  The Company has
strategic partnerships and relationships with such companies as
Xerox and Unisys.  For more information about INSCI, visit
http://www.insci.com For additional investor relation's  
information, visit the Allen & Caron Inc Web site at
http://www.allencaron.com  

                        *    *    *

According to INSCI's Form 10KSB filing dated July 15, 2002,
INSCI had $412,000 of cash and working capital deficit of $6.2
million, at March 31, 2002, in comparison to $460,000 of cash
and working capital deficit of $6.9 million at March 31, 2001.
Accounts receivable were $1.3 million as of March 31, 2002
compared to receivables of $1.5 million as of March 31, 2001.

The Company has a deficiency in its financial statements in that
it has $8.0 million in liabilities and $2.2 million in assets.
This deficiency, unless remedied, can result in the Company not
being able to continue its business operations. The Company
believes that its current business plan, if successfully
implemented, may provide the opportunity for the Company to
continue as a going concern. However, in the event that
satisfactory arrangements cannot be made with creditors, the
Company may be required to seek protection under the Federal
Bankruptcy law.


INTERNET ADVISORY: Must Raise New Funds to Support Business Plan
----------------------------------------------------------------
On March 11, 2002, The Internet Advisory Corporation Inc.,
entered into an Acquisition Agreement with Go West Entertainment
Inc., a New York corporation, and the shareholders of Go West.  
Pursuant to the Acquisition Agreement, Internet Advisory
acquired all of the issued and outstanding capital stock of Go
West from the Go West Shareholders, making Go West a wholly
owned subsidiary of Internet Advisory in exchange for 10,000,000
shares of Internet Advisory's restricted common stock

                      Results Of Operations

For the three-month period ended June 30, 2002 and June 30,
2001, The Internet Advisory Corp., had revenues of $6,250 and
$56,749, respectively. For the six-month period ended June 30,
2002, and June 30, 2001, it had revenues of $56,250 (all of
which were attributable to its month to month contract with
Scores Entertainment, Inc., a related party) and $175,979,
respectively. The decrease in revenue was attributable to the
Internet operations being ceased in the beginning of the second
quarter. Cost of goods sold was $0 for the three-month period
ended June 30, 2002 and $33,369 for the three-month period ended
June 30, 2001, respectively. Cost of goods sold was $0 for the
six-month period June 30, 2002 and $88,761 for the six-month
period ended June 30, 2001. The decrease in cost of goods sold
was attributable to the Internet operations being ceased in the
beginning of the second quarter. The Company incurred general
and administrative expenses of $704,751 for the three-month
period ended June 30, 2002 and $265 for the three-month period
ended June 30, 2001. It incurred general and administrative
expenses of $869,363 for the six-month period ended June 30,
2002 and $187,710 for the six-month period ended June 30, 2001.
The increase in general and administrative expenses was
primarily attributable to legal and consulting expenses incurred
by Go West. For the three-month period ended June 30, 2002, the
Company had a net loss of $704,414, or approximately $.04 per
share, as compared to a net profit of $23,009, for the three-
month period ended June 30, 2001. For the six-month period ended
June 30, 2002, it had a net loss of $868,689, or approximately
$.05 per share, as compared to a net loss of $100,749, or
approximately $.01 per share, for the six-month period ended
June 30, 2001. The Company recognizes revenues as they are
earned, not necessarily as they are collected. Direct costs such
as hosting expense, design cost and server expense are
classified as cost of goods sold. General and administrative
expenses include accounting, advertising, contract labor, bank
charges, depreciation, entertainment, equipment rental,
insurance, legal, supplies, payroll taxes, postage, professional
fees, telephone and travel.

                   Liquidity and Capital Resources

The Internet Advisory Corporation Inc., has incurred losses
since the inception of its business. Its net loss of $868,689
for the six-month period is primarily due to the inclusion of Go
West operating expenses. Since inception, the Company has been
dependent on acquisitions and funding from lenders and investors
to conduct operations. As of June 30, 2002 it had an accumulated
deficit of $1,076,239. As of June 30, 2002, it had total current
assets of $21,923 and total current liabilities of $1,452,138 or
negative working capital of $1,430,215. At December 31, 2001, it
had total current assets of $28,626 and total current
liabilities of $150,991 or negative working capital of $122,365.
The Company currently has no material commitments for capital
expenditures other than those related to the renovation of its
leased property at 533-535 West 27th Street, New York, New York,
at which it intends to operate an adult entertainment nightclub
commencing during the fourth quarter of 2002. The increase in
the amount of its negative working capital is primarily
attributable to payables incurred in connection with payment of
the security deposit on the Leased Property, including payables
due to related parties.

The Company will continue to evaluate possible acquisitions of,
or investments in businesses, products and technologies that are
complimentary to its operations. These may require the use of
cash, which would require it to seek financing. It may sell
equity or debt securities or seek credit facilities to fund
acquisition-related or other business costs. Sales of equity or
convertible debt securities would result in additional dilution
to its stockholders. The Company may also need to raise
additional funds in order to support more rapid expansion,
develop new or enhanced services or products, respond to
competitive pressures, or take advantage of unanticipated
opportunities. Its future liquidity and capital requirements
will depend upon numerous factors, including the success of its
adult entertainment nightclub business.


IT GROUP: Sues Sovereign to Avoid & Recover Fraudulent Transfers
----------------------------------------------------------------
Whippany Venture I LLC, a debtor in these cases, contracted
Sovereign Consulting Inc. to perform demolition and
environmental remediation services on 34 acres of property owned
by Whippany at 75 Troy Hills Road, Whippany in Morris County,
New Jersey.  Under the parties' prepetition Construction
Agreement, Sovereign was required to reduce the soil and
groundwater contamination levels in and around the Whippany
Property.  The Project is necessary in order for Whippany to
obtain authorization from the New Jersey Department of
Environmental Protection for the development of single-family
residences on the Property.

In consideration for its services, Sovereign was to be paid a
fixed price of $3,013,350.  However, Sovereign was to make
periodic applications to Whippany for progress payments as
portions of the work were completed.  Each progress payment was
subject to a retainage amount, ranging from 5% to 10%, to be
held by Whippany until all portions of the Project were
completed to Whippany's satisfaction.  From 1999 to 2001,
Whippany paid a total of $2,637,950 to Sovereign.

But Gregg M. Galardi, Esq., at Skadden, Arps, Slate, Meagher &
Flom LLP, in Wilmington, Delaware, relates that Sovereign
breached its obligations under the Construction Agreement by
providing faulty and deficient services, like:

(a) failing to repair or replace inoperable extraction pumps;

(b) injecting hydrogen peroxide into the soil while the pumps
    were inoperable;

(c) failing to conduct standard bench testing before treating
    the soil;

(d) mislabeling certain groundwater samples provided to the
    NJDEP;

(e) using a contaminated pump to collect groundwater samples;

(f) failing to conduct quality-control equipment tests before
    collecting the groundwater samples;

(g) failing to characterize volatile organic compounds in the
    soil properly;

(h) failing to investigate a septic area despite having advance
    notice from the NJDEP that it was an area of concern;

(i) failing to supervise excavation activities properly; and

(j) failing to cooperate with the NJDEP in connection with the
    remediation of the Whippany Property.

Despite repeated warnings, Sovereign continued to fail under the
Construction Agreement.

On September 6, 2001, Whippany terminated Sovereign.  In the
Termination Letter, Whippany indicated that:

    -- it would make no further payments to Sovereign;

    -- it would continue to withhold all retainage amounts to
       protect itself against further loss or damages resulting
       from Sovereign's deficiencies.  Whippany has previously
       retained an invoice for $103,795;

    -- the withheld amounts would be used fund all direct,
       indirect and consequential costs that Whippany will incur
       in completing the performance of, and remedying the
       defects in, the Project; and

    -- only those amounts left over after the payment of the
       completion costs would be released to Sovereign.

Mr. Galardi notes that the NJDEP has required Whippany to take a
number of costly and time-consuming remedial actions, as a
result of Sovereign's failure.  Whippany has been forced to
correct the defects and deficiencies in Sovereign's performance
and to properly remediate the contamination both on the Whippany
Property and in the neighboring community.  But Whippany was
unable to obtain from the NJDEP, either:

(1) a No Further Action letter for the soil contamination; or

(2) a Classified Exception Area designation for the groundwater
    contamination.

The NFA letter and CEA Designation would have enabled the
residential development to proceed on the Whippany Property.  
Mr. Galardi explains the issuance of the NFA Letter and CEA
Designation is prerequisite to the consummation of the Sterling
Sale Agreement.  Whippany is supposed to sell the Whippany
Property to The Sterling Properties Group LLC after Sovereign is
done with the Project.

The Construction Agreement required Sovereign to complete the
Project by September 16, 2001.  But, as a direct consequence of
Sovereign's failure, the Project remains incomplete until today.
It may not be completed for an estimated three more years.

In that case, Mr. Galardi informs Judge Walrath that the
Debtors' failure to consummate the sale would deprive them,
their successors and assigns of the bargained-for sales price of
at least $4,150,000.  The Debtors would also be exposed to
potential claims.

On October 9, 2001, Sovereign filed a construction lien on the
Whippany Property in Morris County, New Jersey.  Sovereign also
made a demand for arbitration to the American Arbitration
Association.  Whippany rebuffed the lien claim and, instead,
asserted a counterclaim.  On July 12, 2002, Sovereign filed
claims against Whippany, LandBank, Inc. and LandBank
Environmental Properties LLC --- each for $485,229.  Sovereign
alleged that $372,485 represented a secured claim against the
Debtors.  Sovereign based the claim upon the Construction
Agreement.  Sovereign also demanded the release the escrowed
proceeds from the Shaw Asset Sale because the Debtors had not
challenged the extent or validity of Sovereign's alleged lien
within 60 days of the Sale Order.

Accordingly, the Debtors file this adversary proceeding against
Sovereign:

(1) to avoid and recover fraudulent transfers to Sovereign
    pursuant to federal bankruptcy law and the New Jersey
    Uniform Fraudulent Transfer Act;

(2) for damages arising from Sovereign's breach of the
    Construction Agreement; and

(3) to disallow Sovereign's proofs of claim against the Debtors
    in these bankruptcy cases. (IT Group Bankruptcy News, Issue
    No. 16; Bankruptcy Creditors' Service, Inc., 609/392-0900)  


KMART: Proposes Uniform Non-Core Asset Sale Bidding Procedures
--------------------------------------------------------------
In order to facilitate prompt asset dispositions on terms
approved by the Court, Kmart Corporation and its debtor-
affiliates urge Judge Sonderby to enter an Order approving the
proposed standing bidding procedures and bid protection to be
utilized in connection with dispositions of non-core assets.

Mark A. McDermott, Esq., at Skadden, Arps, Slate, Meagher &
Flom, in Chicago, Illinois, contends that the Debtors have
determined that the standard bidding procedures and bid
protection as proposed are the most likely mechanisms for
maximizing the realizable value of various sales opportunities
that may arise, while providing clear, advance notice to parties
in interest of the ground rules.

Under the Bidding Procedures:

(a) only Qualified Bidders may participate in the asset sales
    process.  Qualified Bidders are those who deliver to the
    Debtors:

     (1) an executed confidentiality agreement in form and
         substance satisfactory to the Debtors;

     (2) current audited financial statements or other financial
         information of the bidder or its equity holders
         demonstrating the bidder's financial capability to
         consummate a Sale of assets, as determined by the
         Debtors in their sole discretion; and

     (3) a preliminary, non-binding proposal identifying:

           * the assets to be purchased;
           * the purchase price range;
           * the nature and extent of any due diligence it
             wishes to conduct;
           * any conditions it may wish to impose; and
           * financial information demonstrating its ability to
             consummate the sale.

    Qualified Bidders may be allowed to conduct due diligence on
    the assets;

(b) in order for a bid to be a Qualified Bid, that bid must be:

    (1) in the form of an asset purchase agreement acceptable to
        the Debtors;

    (2) accompanied by a good faith deposit equal to at least
        10% of the value of the bid;

    (3) accompanied by a financing commitment or other evidence
        of ability to consummate the transaction; and

    (4) received by the Debtors prior to the Bid Deadline.

    By making a bid, a bidder will be deemed to have agreed to
    keep this offer open until the earlier of:

     --- 2 business days after the assets upon which the bidder
         is bidding have been disposed of pursuant to the
         Bidding Procedures; and

     --- 30 days after the Sale Hearing;

(c) in order to induce Qualified Bidders to submit offers to the
    Debtors, the Debtors offer to the first Qualified Bidder, as
    Bid Protection:

     (1) the right to receive a termination fee equal to no more
         than 2% of the cash value of the Qualified Bid in the
         event another Qualified Bidder ultimately is the
         Successful Bidder and that transaction closes; and

     (2) a reasonable and documented expense reimbursement of up
         to $50,000, likewise payable only in the event the
         Debtors close on a higher or otherwise better offer
         submitted by a competing bidder;

    The termination fee would not be offered with respect to
    insiders, nor will the Bid Protection be granted more than
    once as to any particular asset;

(d) If one or more Qualified Bidders submit Qualified Bids
    acceptable to the Debtors prior to expiration of the Bid
    Deadline, the Debtors will file with this Court and serve a
    copy of the first Qualified Bid upon these parties:

       (i) counsel for the Debtors' DIP Lenders;

      (ii) counsel to the official committees;

     (iii) the U.S. Trustee;

      (iv) entities which have an Interest in the assets to be
           sold; and

       (v) federal, state, and local regulatory or taxing
           authorities or recording offices which have an
           interest in the sale transaction;

(e) If the Debtors receive more than one Qualified Bid for a
    particular asset or pool of assets, the Debtors may conduct
    an Auction on the date as the Debtors may determine.  
    Bidding at the Auction will commence with the highest or
    otherwise best Qualified Bid mid continue in a manner as the
    Debtors may determine will result in the highest or
    otherwise best offer;

(f) At the conclusion of the bidding, the Debtors will announce
    the Successful Bidder.  The Debtors may:

    (1) determine, in their business judgment and in
        consultation with the representatives of the Committees,
        which Qualified Bid is the highest or otherwise best
        offer; and

    (2) reject at any time before entry of an order of the Court
        approving a Qualified Bid any bid that, in the Debtors'
        reasonable business judgment and after consulting the
        Committees, is:

         --- inadequate or insufficient;

         --- not in conformity with the requirements of the
             Bankruptcy Code, the Bidding Procedures, or the
             terms and conditions of the sale; or

         --- contrary to the best interests of the Debtors,
             their estates and their creditors;

(g) The Debtors will submit any Successful Bids to this Court
    for approval at the omnibus hearing directly following the
    determination of a Successful Bid --- the Sale Hearing;

(h) The Debtors will be deemed to have accepted a bid only when
    the bid has been approved by the Court at the Sale Hearing.
    Upon failure to consummate any sale because of a breach or
    failure on the part of any Successful Bidder, the Debtors
    will select the next highest or otherwise best Qualified Bid
    to be the Successful Bid without further order of the Court.
    (Kmart Bankruptcy News, Issue No. 31; Bankruptcy Creditors'
    Service, Inc., 609/392-0900)   

Kmart Corp.'s 9% bonds due 2003 (KM03USR6), DebtTraders reports,
are trading at 17 cents-on-the-dollar. See
http://www.debttraders.com/price.cfm?dt_sec_ticker=KM03USR6for  
real-time bond pricing.


KNOWLES ELECTRONICS: Raises $10MM from Senior Sub. Debt Issue
-------------------------------------------------------------
Knowles Electronics Holdings, Inc., received $10 million gross
proceeds from the issuance of a senior subordinated note. This
note is pari passu with the Company's outstanding senior
subordinated notes due 2009 and was purchased by an affiliate of
Doughty Hanson & Co, Ltd., a private equity concern which
controls the equity of Knowles.

The note bears interest at 10% per annum and has terms which are
substantially identical to the Company's outstanding senior
subordinated notes.

Knowles Electronics is the world's leading manufacturer of
transducers and related components used in hearing aids. The
company also manufactures acoustic components used in voice
recognition, telephony, and Internet applications as well as
automotive solenoids and sensors. In 1999, the European fund
management company Doughty Hanson & Co Ltd., acquired Knowles.

As previously reported in the Troubled Company Reporter,
Knowles' June 30, 2002 balance sheet shows a total shareholders'
equity deficit of about $485 million.


LASERSIGHT INC: Sets Annual Shareholders' Meeting for October 25
----------------------------------------------------------------
LaserSight Incorporated (Nasdaq: LASE) has set August 29, 2002
as the record date for its 2002 Annual Meeting of Stockholders.  
The 2002 Annual Meeting of Stockholders will be held on October
25, 2002, at 0:00 a.m. local time, at the Hilton Garden Inn,
Orlando Airport, Orlando, Florida.   Because the date of the
2002 Annual Meeting of Stockholders is more than 30 calendar
days past the anniversary of LaserSight's 2001 Annual Meeting
of Stockholders, if a stockholder intends to present a proposal
at the 2002 Annual Meeting, LaserSight's Bylaws require that the
proposal must be received by LaserSight no later than September
9, 2002.

As previously announced, LaserSight has executed definitive
agreements with Shenzhen New Industries Medical Development Co.,
Shenzhen, People's Republic of China and a Hong Kong-based
affiliate.  As part of the transaction the Hong Kong affiliate
will be making a $2 million equity investment in LaserSight
Incorporated in the form of Convertible Preferred Stock that,
subject to certain restrictions, can be converted into shares of
LaserSight's Common Stock resulting in the Hong Kong affiliate
holding approximately 40% of LaserSight's Common Stock.  The
issuance of the Convertible Preferred Stock and the funding of
the equity investment is expected to occur by the end of
September 2002.  The definitive agreements provide that once the
funding of the equity investment and the issuance of the
Convertible Preferred Stock has occurred, the Holders of the
Convertible Preferred Stock shall, voting separately as a single
class by unanimous written consent, elect three members to
LaserSight's Board of Directors.  At the 2002 Annual Meeting of
Stockholders, LaserSight's stockholders (other than the holders
of the Convertible Preferred Stock) will vote to elect the
remaining four members of LaserSight's Board of Directors.

Under the rules of The Nasdaq Stock Market, LaserSight would
ordinarily be required to obtain shareholder approval for the
issuance of the Convertible Preferred Stock.  However, under the
rules Nasdaq may grant LaserSight an exception to the
shareholder approval requirement based on the financial
condition of LaserSight.  Nasdaq has granted LaserSight's
request for an exception to the shareholder approval
requirement.  LaserSight will be mailing its shareholders a
letter informing them that, as required by Nasdaq's rules,
LaserSight's Audit Committee has expressly approved LaserSight's
reliance on the exception granted by Nasdaq, that LaserSight
will rely on the exception granted by Nasdaq, and that
LaserSight will not be submitting the question of the issuance
of the Convertible Preferred Stock to its shareholders for
approval.

LaserSight is a leading supplier of quality technology solutions
for laser vision correction and has pioneered its patented
precision microspot scanning technology since it was introduced
in 1992. Its products include the LaserScan LSX(R) precision
microspot scanning system, its international research and
development activities related to the Astra family of products
used to perform custom ablation procedures known as CustomEyes
and its MicroShape(R) family of keratome products. The Astra
family of products includes the AstraMax(TM) diagnostic
workstation designed to provide precise diagnostic measurements
of the eye and CustomEyes CIPTA and AstraPro(TM) software,
surgical planning tools that utilize advanced levels of
diagnostic measurements for the planning of custom ablation
treatments. In the United States, the Company's LaserScan
LSX excimer laser system operating at 200 Hz is approved for the
LASIK treatment of myopia and myopic astigmatism. The MicroShape
family of keratome products includes the UltraShaper durable
keratome and UltraEdge(R) keratome blades.

                           *    *    *

As reported in Troubled Company Reporter's August 9, 2002
edition, LaserSight Inc., received notification from the Nasdaq
Listings Qualification Panel that effective with the opening of
business on August 9, 2002, the Company's Common Stock will be
transferred to The Nasdaq SmallCap Market and will no longer be
eligible for trading on The Nasdaq National Market.

If the Company is unable to meet that requirement, it may be
eligible for an additional 180-day grace period for trading on
The Nasdaq SmallCap Market, provided it is able to demonstrate
shareholders' equity of at least $5 million, is in compliance
with all other requirements for continued listing on The Nasdaq
SmallCap Market, and files an application for new listing and
the related review on or before August 13, 2002. The Company
believes it meets those requirements and plans to file that
application on time.


LSP BATESVILLE: NRG Downgrade Spurs S&P to Hatchet Rating to B
--------------------------------------------------------------
Standard & Poor's Ratings Services lowered its rating on LSP
Batesville Funding Corp's (the project) $326 million senior
secured bonds to single-'B' from double-'B'-plus. The rating
remains on CreditWatch with negative implications.

The rating action was taken following the recent downgrade of
NRG Energy Inc., to triple-'C'. The project is an indirect
wholly owned subsidiary of NRG.

"Standard & Poor's will only rate the debt of a wholly owned
subsidiary higher than the rating of the parent on the basis of
bankruptcy remoteness provided by structural enhancements, such
as covenants, a pledge of stock, and an independent director,
assuming the stand-alone credit quality of the entity supports
such elevation," said credit analyst Elif Acar. "We view these
provisions as supportive in that they reduce the risk of a
subsidiary being filed into bankruptcy in the event of a parent
bankruptcy, but do not view them as 100% preventative of such a
scenario," she added. Therefore, Standard & Poor's limits the
rating differential provided by such structural enhancements to
three notches. On that basis, the rating on the project's debt
cannot be higher than single-'B', and would also be on
CreditWatch with negative implications, reflecting the
CreditWatch status of NRG.

Standard & Poor's also reviewed the financial projections of the
project based on revised numbers and determined that the debt
service coverage ratios until 2006 are lower than the original
pro forma values, which were estimated at around 1.4 times.
Reduced energy revenues based on lower capacity factors, and
higher than originally projected labor expenses ultimately drive
the lower debt service coverage ratios. In 2002, the debt
service coverage will be especially low at approximately 1.1x,
mainly attributable to reduced revenues due to the extended
outage during September 2001-June 2002. By 2006, Standard &
Poor's expects the coverages to increase to levels that are more
in line with the project's original projections based on certain
step-up provisions in its reservation payments under the tolling
agreements.

The CreditWatch reflects that of NRG's rating. Upside rating
movements could occur if parent ratings improve.


MARINER POST-ACUTE: Seeks Final Decree Closing Subsidiary Cases
---------------------------------------------------------------
Mariner Post-Acute Network, Inc., wants the Court to enter a
final decree closing each now-administered MPAN-subsidiary
chapter 11 cases.  Mariner Post-Acute Network, Inc.'s case is
not affected by this request and will remain open until all
claims against MPAN are resolved.  In short, MPAN explains,
nothing remains to be accomplished in the Subsidiary Cases.

MPAN argues that closing the subsidiary cases is appropriate at
this time.  Pursuant to the Plan, each Reorganized Debtor may
close its respective chapter 11 cases after the Effective Date,
provided that the Chapter 11 Case of at least one Reorganized
Debtor remains open until the Debtors' estate is fully
administered.  Once closed, all rights of the Reorganized Debtor
in a closed case will vest in the Reorganized Debtor that hasn't
closed its case.

The MPAN Debtors ask the Court to retain jurisdiction over any
pending adversary proceedings, consistent with Section VIII of
the Plan.

The Debtors point out that entry of a final decree in the
Subsidiary Cases will preserve the Reorganized Debtors funds and
creditors who received distributions of stock and warrants will
benefit.  Moreover, closing the Subsidiary Cases will avoid the
possible accrual of substantial additional post-confirmation
fees imposed by the U.S. Trustee.

The Debtors ask the Court to waive the requirement of Local Rule
5009-1(c) for filing a final report for each Subsidiary Case.
Because of the substantive consolidation of the MPAN Debtors'
cases under the Plan, the Debtors suggest a single, consolidated
final report will do.  The Debtors assure the Court that before
the Lead Case is closed, a final report will be completed.
(Mariner Bankruptcy News, Issue No. 32; Bankruptcy Creditors'
Service, Inc., 609/392-0900)  


MERRILL CORP: S&P Junks Classes A & B Senior Subordinated Notes
---------------------------------------------------------------
Standard & Poor's Ratings Services assigned its triple-'C'-plus
rating to communications and document services company Merrill
Corp.'s $25 million Class A senior subordinated notes due 2009
and $120.5 million Class B senior subordinated notes due 2009.
In addition, Standard & Poor's affirmed Merrill's single-'B'
senior secured bank loan rating and removed it from CreditWatch,
where it was placed in February 2001. At the same time, Standard
& Poor's raised its corporate credit rating on St. Paul,
Minnesota-based Merrill to 'B' from 'SD', and its subordinated
debt rating to 'CCC+' from 'D'. Adjusted for the recent
recapitalization, the company had approximately $395 million in
consolidated debt outstanding as of April 30, 2002. The outlook
is negative.

"The ratings reflect Merrill's still significant debt levels,
moderate-size cash flow base, and competitive market
conditions," said Standard & Poor's credit analyst Michael
Scerbo. He added, "In addition, the company's transaction-based
financial printing business is subject to the volatility of the
capital markets. These factors are tempered by Merrill's solid
market positions, diversified customer base, and long-standing
client relationships. Also, the company's increasing focus on
the production of compliance and reporting materials provides a
more stable revenue and cash flow base."

The negative outlook is based on the evaluation that the ratings
could be lowered if the company's consolidated financial profile
weakens from current levels due to the difficult operating
environment.


MOUNTAIN OIL: Auditors Doubt Company's Ability to Continue Ops.
---------------------------------------------------------------
Mountain Oil Inc., is incorporated under the laws of the state
of Utah and is primarily engaged in the business of acquiring,
developing, producing and selling oil and gas products and
properties to  companies located in the continental United
States.

As of June 30, 2002, the Company had a working capital
deficiency, an accumulated deficit, and has incurred substantial
operating losses.  In addition, the Company's oil and gas
reserves have  declined significantly. These conditions raise
substantial doubt about the ability of the Company to continue
as a going concern.  

Net oil and gas sales were $288,000 and $540,000 for the six
months ended June 30, 2002 and 2001, respectively.  This 47%
decrease in sales is primarily attributable to decreasing both
the number of   producing wells, the production rates of
existing wells, and the declining price of oil.  For the six  
months ended June 30, 2002 the Company received a gross average
of $20.48 per barrel.

Operating costs for the six months ended June 30, 2002 and 2001
were $154,000 and $405,000,  respectively. This 62% decrease in
production costs is attributable to the reduction of well
reworking activities.  The Company also reduced its full-time
production employees to a total of four in January because of
lower oil prices.

General and administrative expenses decreased 49% to $131,000
from $256,000 for the six months ended June 30, 2002 and 2001,
respectively.  Depreciation, depletion and amortization expenses
decreased 18% to $93,000 for the six months ended June 30, 2002,
from $114,000 for the same period in 2001.  Interest expense for
the six months ended June 31, 2002 and 2001 was $6,000 and
$28,000, respectively.  Other income for these same periods were
13,000 and $22,000 respectively.  These decreases are
attributable to the Company's general decline in operations and
conversion of 822,000 in convertible notes to common stock at
$1.50 in April of 2001 and very small interest bearing on bank
deposits.

As a result of the foregoing, the Company realized a net loss of
$83,000 for the six months ended  June 30, 2002, as compared to
a net loss of 241,000 for the six months ended June 30, 2001.

At June 30, 2002, Mountain Oil had a working capital deficit of
$141,000 as compared to working capital of $344,000 at June 30,
2001.  This substantial difference to working capital is due to
the public offering that closed in February 2001 that increased
Mountain's working capital substantially  and then resulting
operations and expenses that have resulted in deficits.

Mountain Oil has reduced operating costs through the reduction
of personnel and has shifted direct production efforts to the
more profitable wells. If the Company is unable to operate
profitably it will require additional debt or equity financing
within the next twelve months. If Mountain Oil is successful in
improving production during this period and/or if the price of
oil increases, management believes that Mountain Oil will
generate sufficient revenues internally to cover its  operating
expenses.  The Company is currently looking for opportunities to
develop its undeveloped  lease acreage by drilling new wells
with partners or through farm out arrangements.


NETIA: Creditors' Meeting to Vote on Plans Continued to Sept. 30
----------------------------------------------------------------
Netia Holdings S.A. (Nasdaq: NTIAQ/NTIDQ, WSE: NET), Poland's
largest alternative provider of fixed-line telecommunications
services, announced that the creditors' meeting to accept the
composition plans of its three Dutch subsidiaries, Netia
Holdings B.V., Netia Holdings II B.V., and Netia Holdings III
B.V., was adjourned by the supervisory judge until September 30,
2002.

The verification hearings by the court in the Netherlands have
been provisionally fixed for October 9, 2002.

Netia Holdings SA's 13.125% bonds due 2009 (NETH09NLN1),
DebtTraders reports, are trading at 18 cents-on-the-dollar. See
http://www.debttraders.com/price.cfm?dt_sec_ticker=NETH09NLN1
for real-time bond pricing.


NRG GROUP: Continues to Pursue Efforts to Sell Remaining Assets
---------------------------------------------------------------
The NRG Group Inc. (TSX:NRG), reported financial results for the
second quarter ended June 30, 2002.

                         Operating Results

NRG reported a loss of $892,000 for the three months ended June
30, 2002 compared to net income of $2.8 million for the same
period last year.

NRG recorded an unrealized loss on investments for the three
months ended June 30, 2002 of $824,000 compared to an unrealized
gain of $3.7 million for the second quarter last year. The
unrealized investment losses result from an unrealized write-
down in the carrying value of The Fund Library Inc., and
fluctuations in the market value of MedcomSoft Inc. (TSX:MSF).
Although The Fund Library Inc., continues to be cash flow
positive, it has been negatively impacted by the downturn in the
mutual fund industry and the continuing decrease in advertising
activity. Subsequent to the end of the quarter, NRG sold the
remainder of its shares in Medcomsoft Inc.

Total expenses for the quarter ended June 30, 2002 were $73,000
compared to $991,000 for the same period last year. Management
has significantly reduced expenses, which consist primarily of
legal, audit and public listing fees.

The Company continues to discuss a number of its alternatives
with respect to maximizing shareholder value including the
utilization of its tax losses. The Company also continues to
sell its remaining assets but to date has not received any
satisfactory offers for its remaining assets.

NRG was notified by the Toronto Stock Exchange on May 27, 2002
that the TSX was reviewing the Company with respect to the
continued listing criteria in regards to public distribution,
price or trading activity of the Company's securities. In
particular, the market value of NRG's publicly held securities
has been below the $2 million threshold for 30 consecutive
trading days. NRG has until September 24, 2002 to meet the TSX
requirements after which date the securities may be suspended
from trading.


NUTRITIONAL SOURCING: Misses Interest Payment on Two Debt Issues
----------------------------------------------------------------
Nutritional Sourcing Corporation, formerly known as Pueblo Xtra
International, Inc., announced improved results for the third
quarter (12 weeks) and 40 weeks ended August 10, 2002.  NSC is
the parent corporation of Pueblo International, LLC, one of the
largest supermarket operators in Puerto Rico and the U.S. Virgin
Islands, and Pueblo Entertainment, Inc., the largest video
rental operator in Puerto Rico.

On November 2, 2001 the Company changed its fiscal year-end from
the Saturday closest to January 31 to the Saturday closest to
October 31. Consequently, the third quarter of the current
fiscal year is the 12 weeks ended August 10, 2002 and the first
three quarters of the current fiscal year are the 40 weeks ended
August 10, 2002.  The comparable periods are the 12 and 40 weeks
ended August 11, 2001, which are presented herein for comparison
purposes.  The results for the forty weeks ended August 11, 2001
have never been reported separately in filings with the
Securities and Exchange Commission.

Total sales for the 12 and 40 weeks ended August 10, 2002 were
$135.8 million and $459.2 million, respectively, versus $127.6
million and $447.1 million in the related periods of the prior
year, increases of 6.4% and 2.7%, respectively.  For the
comparable 12 and 40 week periods, same store sales were $135.8
million and $457.3 million, respectively, this year versus
$126.5 million and $441.8 million, respectively, for the prior
year, increases of 7.3% and 3.5%, respectively.  "Same stores"
are defined as those stores that were open as of the beginning
of both periods and remained open through the end of the
periods.  Same store sales in the Retail Food Division increased
8.2% and 3.9% for the 12 and 40 weeks, respectively.  The
principal factors contributing to the increase in same store
sales in the Retail Food Division, despite continued growth in
competition, were the Company's PuebloCard, a customer loyalty
card program launched in March 2001, and the Company's
repositioning efforts, also begun in March 2001.  Video Rental
Division same store sales decreased 3.4% and 2.1% for the 12 and
40 weeks, respectively. The decrease in Video Rental Division
same store sales for the quarter was the result of both a
decline in the number of new releases and in customer response
to new releases for both rental and sell-through videos.

Net income for the 12 and 40 weeks ended August 10, 2002 was
$8.2 million and $1.3 million, respectively, improvements of
$9.7 million and $10.5 million, respectively, from the net
losses in the comparable periods of the prior year.  The net
loss for the 12 and 40 weeks ended August 11, 2001 was $1.5
million and $9.2 million, respectively.  The net income for the
12 and 40 weeks ended August 10, 2002 included a gain from the
settlement of the Company's business interruption claim as a
result of Hurricane Georges of $3.2 million, net of taxes.

EBITDA (defined as Earnings Before Interest Expense-Net, Income
Taxes, Depreciation and Amortization) for the 12 and 40 weeks
ended August 10, 2002 was $24.8 million and $45.5 million,
respectively, versus $9.5 million and $25.6 million,
respectively, for the comparable periods of the prior year,
increases of $15.3 million and $19.9 million, respectively.  
EBITDA for the 12 and 40 weeks ended August 10, 2002 includes a
pre-tax gain from insurance settlement of $14.7 million.  The
remaining $0.6 million and $5.2 million improvements in EBITDA
for the 12 and 40 weeks ended August 10, 2002, respectively,
versus the comparable periods of the prior year, are primarily
the results of increased sales, improvement in the rate of gross
margins as a percentage of sales and the cost reductions
implemented in late April of 2001.

The Company's operating subsidiaries (Pueblo International, LLC,
Xtra Super Food Centers, Inc. and Pueblo Entertainment, Inc.)
did not pay $8.4 million of inter-company interest that was due
to the Company on August 1, 2002.  Consequently, the Company was
unable to pay the semi-annual interest payment of $8.4 million
due to third parties on its 9.5% Senior Notes and its 9.5%
Series C Senior Notes which was due on that date.  The Notes,
which total $177.3 million principal amount, are due in August
2003.  The Company and certain of its noteholders have initiated
discussions concerning the possible restructuring of its
indebtedness.

The lender banks involved in the revolving credit facility under
which the operating subsidiaries have cash borrowings of $32.0
million and letters of credit outstanding of $3.9 million
consented to the non-payment of interest on the Notes.  In
addition, the lender banks and the Company have agreed to
permanently reduce the total availability under the revolving
credit facility to $38.0 million through the termination date of
the facility, which is February 1, 2003.  Total availability had
been previously limited to $40.0 million.

Cash and cash equivalents at August 10, 2002 were $24.8 million.
During the 40 weeks ended August 11, 2001 the Company closed two
of its supermarkets and two of its video rental stores in Puerto
Rico.  The Company also relocated one of its video rental stores
in Puerto Rico during the 40 weeks ended August 11, 2001. During
the 40 weeks ended August 10, 2002, the Company closed an
additional supermarket in Puerto Rico.  NSC, through its
subsidiaries operates 47 supermarkets and 41 video rental stores
in Puerto Rico and the U. S. Virgin Islands.


ORTEC INT'L: Commences Trading on OTCBB Effective August 30
-----------------------------------------------------------
Ortec International, Inc., announced that NASDAQ had denied
Ortec's appeal for continued inclusion on the NASDAQ Small CAP
Market. Ortec was advised Thursday evening after the close of
the Market, that effective with the open of business on August
30, Nasdaq would delist the Company's securities from the NASDAQ
Stock Market. Accordingly, Ortec securities began trading on the
OTC Bulletin Board.

Steven Katz, Ph.D., Chairman and CEO, said, "Nasdaq's denial of
our appeal necessitating our transferring to the OTC Bulletin
Board does not impact our ability to execute our business plan
and near term milestones. We will continue on the path of
completing our venous pivotal clinical trial this year and
filing of our Pre-Market Approval application in the 1st quarter
of 2003 and the consummation of a corporate partner deal."

Ortec International, Inc., is a tissue engineering company
involved in the commercialization of a proprietary and patented
technology to stimulate the repair and regeneration of human
tissue. Ortec's current focus is the application of its
OrCel(TM) (Bi-layered Cellular Matrix) to heal chronic and acute
wounds. Ortec is composed of a collagen sponge seeded with
allogeneic epidermal and dermal cells. These cells secrete
growth factors and cytokines normally found in acute human
wounds and are believed to have a beneficial role in promoting
tissue repair. In addition to having received FDA approvals
during 2001 for the treatment of Epidermolysis Bullosa and donor
sites in burn patients, a pivotal clinical trial is ongoing in
venous ulcers and the FDA has granted Ortec approval to initiate
a pivotal trial in diabetic foot ulcers. Ortec believes that its
platform technology may extend to the regeneration of other
human tissue such as tendons, ligaments, cartilage, bone, muscle
and blood vessels. For more information, visit Ortec's Web site  
http://www.ortecinternational.com


OSE USA: March 31, 2002 Balance Sheet Upside-Down by $29 Million
----------------------------------------------------------------
OSE, USA, Inc. (OTCBB:OSEE), reported its amended results for
the first quarter ended March 31, 2002.

The Company filed with SEC an amended 10-Q for the three month
period ended March 31, 2002. This Form 10-Q/A amends the
Company's quarterly Form 10-Q for the first fiscal quarter ended
March 31, 2002 as filed on May 20, 2002 and is being filed to
reflect the restatement of the Registrant's consolidated
financial statements for that period. The restatement relates to
the adoption of Statement of Financial Accounting Standards
(SFAS) No. 142, Goodwill and Intangible Assets. As required by
the transitional provisions of SFAS No. 142, the Company
reviewed the carrying value of goodwill as of January 1, 2002
for impairment. Results from the review indicated that the
carrying value of the reporting unit, OSEI, an operating segment
of the company, to which goodwill was assigned, exceeded its
estimated fair value. The Company determined the amount of
goodwill impairment by allocating the estimated fair value of
the reporting unit to its assets and liabilities. The fair value
of the impaired segment was estimated using a discounted cash
flow methodology. The results of this allocation indicated that
goodwill was fully impaired. As a result, the Company charged an
impairment loss of $1,400,000 to the results of operations as a
cumulative change in accounting principle. The loss only
affected the Company's distribution segment. The consolidated
financial statements as of and for the three months ended March
31, 2002 have been restated to reflect the $1,400,000 goodwill
impairment discussed above, as of the adoption of SFAS 142,
which was January 1, 2002.

At March 31, 2002, OSE USA's balance sheets shows a working
capital deficit of about $24 million, and a total shareholders'
equity deficit of about $29 million.

Founded in 1992 and formerly known as Integrated Packaging
Assembly Corporation, OSE USA, Inc., is the nation's leading
onshore advanced technology IC packaging foundry. In May 1999
Orient Semiconductor Electronics Limited, one of Taiwan's top IC
assembly and packaging services companies, acquired controlling
interest in IPAC, boosting its US expansion efforts. The Company
entered the distribution segment of the market in October 1999
with the acquisition of OSE, Inc.  In May 2001 IPAC changed its
name to OSE USA, Inc., to reflect the company's strategic
reorganization.

San Jose-based OSE USA delivers competitive cost and quality in
moderate volumes with fast cycle times relative to its offshore
competitors. The company's close proximity to its customers
allows OSE USA to provide dynamic, quick-response, application-
specific packaging solutions to customers worldwide. The
company's latest services include Micro Lead frame, Flip Chip,
and Chip-Scale package assembly and manufacturing.

OSE USA offers these services to support its customers'
engineering, pre-production, low volume production and hot lot
requirements. The company will continue to develop and lead in
the areas of microelectronic packaging technology in the design,
packaging, and electrical testing industry. OSE USA's customers
include IC design houses, OEMs, and manufacturers. For more
information, visit OSE USA's Web site at: http://www.ose-usa.com  
or contact Chris Ooi at 408-321-3629 about these services.


OUTSOURCING SERVICES: S&P Lowers Corporate Credit Rating to B-
--------------------------------------------------------------
Standard & Poor's lowered its corporate credit rating on
Outsourcing Services Group Inc., to single-'B'-minus from
single-'B' as a result of the company's poor operating
performance and increased debt leverage.

Total debt at the Allendale, New Jersey-based company was about
$171 million on June 29, 2002. The outlook is negative.

The company's financial results were weak for the six months
ended June 29, 2002, reflecting an 8% decline in revenues
(excluding acquisitions) and a 23% drop in operating profit
(before depreciation, amortization, and nonrecurring charges).
The sales decline was the result of extreme softness in OSG's
Kolmar cosmetics segment, which participates in the highly
competitive U.S. beauty business.

"The operating profit decline was due to lower sales,
inefficiencies within the consumer segment, and increased
manufacturing and administrative costs," said Standard & Poor's
credit analyst Lori Harris. "Standard & Poor's believes that OSG
will continue to be challenged in the intermediate term by the
highly competitive environment in which it operates."

The ratings reflect the company's weak operating performance and
high debt leverage, resulting from its aggressive acquisition
strategy, partially offset by OSG's good position in the
contract manufacturing industry.

OSG is a full-service contract manufacturer providing product
conceptualization, formulation, manufacturing, filling, and
packaging services largely to the North American health, beauty,
personal care, and pharmaceutical markets. The company also
provides materials procurement, warehousing, and distribution of
finished product.


PACIFIC GAS: Asks Court to Okay Settlement with Sierra re PPAs
--------------------------------------------------------------
Pacific Gas and Electric Company seeks the Court's authority to
enter into:

(1) a Settlement Agreement resolving ongoing litigation and
    claims between PG&E, Sierra Pacific Industries -- SPI, and
    the California Independent Systems Operator -- the ISO; and

(2) an Assumption Agreement to assume the Power Purchase
    Agreements -- PPAs -- of four Qualifying Facilities -- QFs
    -- owned by SPI, namely the Burney Facility, the Quincy
    Facility, the Susanville Facility, and the Lincoln Facility.

             History Of The Dispute Between The Parties

In the mid-1980s, PG&E entered into the long-term Power Purchase
Agreements with the four SPI facilities.

Beginning in the late summer of 2000, PG&E was forced to pay
dramatically increased wholesale prices for electricity but was
prevented from passing these costs on to retail customers.  In
this circumstance, PG&E suffered from a financial shortfall.

PG&E was unable to fully pay SPI for its December 2000 and
January 2001 deliveries.  For February and March 2001 energy
deliveries, PG&E simply did not make any payment.

In total, PG&E's underpayment to SPI was $18 million.

Shortly before PG&E petitioned for Chapter 11 relief, SPI filed
a complaint against PG&E and the ISO in Sacramento Superior
Court, Case No. 01AS02027.  In this State Court Action, SPI
asserted eight separate contract based claims against PG&E based
on PG&E's defaults under the PPAs.  SPI also asserted non-
contractual claims against PG&E and the ISO arising out of
alleged conspiracy between PG&E and the ISO to exclude SPI from
the California energy market. SPI asserted non-contractual
claims for alleged antitrust violations under California's
Cartwright Act, unfair competition, intentional interference
with prospective business advantage, and declaratory relief.

On April 5, 2001, SPI sought and obtained a temporary
restraining order in the State Court Action, barring PG&E or the
ISO from taking any extra-judicial steps to prevent SPI from
selling its power to third parties.  The court found
preliminarily that PG&E had breached the PPAs through its
partial payment; PG&E's asserted defense of force majeure
failed.

A few weeks after filing its voluntary petition, PG&E removed
the State Court Action to the U.S. Bankruptcy Court for the
Eastern District of California, which in turn transferred the
State Court Action to the U.S. Bankruptcy Court for the Northern
District of California San Francisco Division -- the Court that
oversees PG&E's Chapter 11 proceeding.

As previously reported, in its Chapter 11 proceeding, SPI
commenced an adversary proceeding against PG&E.  Judge Montali
granted SPI a preliminary injunction to enjoin PG&E and ISO from
interfering with SPI's efforts to sell its electricity into the
California market.  In making the ruling, Judge Montali found
that there was a likelihood of SPI prevailing on the merits of
its claim that SPI cancelled its power purchase agreement with
PG&E before PG&E petitioned for bankruptcy.  Judge Montali found
that the balance of hardships tip in favor of SPI.

Judge Montali subsequently granted SPI partial summary judgment
that PG&E had materially breached its obligations under the
PPAs, and that SPI had no further obligations under the PPAs.

Finally, Judge Montali granted SPI relief from the automatic
stay and remanded the State Court Action to the Sacramento
Superior Court.  PG&E appealed the Court's Order remanding the
State Court Action.  The appeal is currently pending before the
U.S. Bankruptcy Appellate Panel of the Ninth Circuit.

Additionally, SPI filed Proof of Claim No. 8845 in the amount of
$1,108,361,147, based primarily on damages it contended were
owed in the State Court Action, including nearly $900 million in
punitive damages.

                 The Mediation And The Settlement

In April 2002, the parties retained Layn R. Phillips, an
experienced mediator, former United States District Judge and
current partner at the law firm of Irell & Manella, to mediate
the issues presented in the State Court Action.

On June 4, 2002, Judge Phillips presided over the mediation,
which was attended by the chief executive officers of SPI, PG&E
and the ISO.

Negotiations culminated with the drafting of the Settlement and
Assumption Agreements.  The Agreements provide for an integrated
resolution of the State Court Action, the Appeal, and SPI's
Claim, as well as the amendment and assumption of SPI's PPAs.

The Settlement Agreement provides for:

(a) The reinstatement and amendment of the PPAs including:

    (1) the provision of a fixed energy price of 5.37 cents per
        kWh for four years, pursuant to CPUC Decision 01-06-015,
        and after the four-year term reversion to PG&E's short-
        run avoided costs -- SRAC -- as determined by the CPUC
        pursuant to the provisions of the PPAs;

    (2) the addition of provisions allowing for the pooling of
        capacity from the four QFs; and

    (3) the deletion of the minimum damages clause.

(b) PG&E's cure of all prepetition defaults owing to SPI under
    the PPAs for $17,950,371.15, and interest at a 5% rate per
    annum;

(c) SPI's payment of amounts due PG&E by SPI or its affiliate
    Sierra Pine for energy and energy related services provided
    by PG&E during the period from March 1, 2001 through June 1,
    2001, $912,050, and interest at a 5% rate per annum,
    compounded monthly;

(d) PG&E's agreement not to place SPI on probation for its
    failure to deliver either energy or capacity between March
    21, 2001 and the date it begins to provide energy and
    capacity to PG&E pursuant to the amended PPAs;

(e) The dismissal of both the State Court Action and the Appeal;

(f) Full releases of all known and unknown claims between SPI
    and PG&E, other than the Section 503 administrative expense
    claims provided for in the Assumption Agreement with respect
    to PG&E's prepetition defaults and interest on the defaults;
    and

(g) Limited releases between SPI and the ISO, and between PG&E
    and the ISO.

The Assumption Agreement provides for the assumption of the
amended PPAs and the cure of any prepetition defaults pursuant
to Section 365 of the Bankruptcy Code.  The Assumption Agreement
also provides for SPI's waiver of its right to recover pecuniary
loss damages in connection with the assumption of the amended
PPAs.

PG&E notes that other than the monthly compounding of interest,
the terms in the Assumption Agreement are consistent with those
reached between PG&E and over two hundred other qualifying
facilities, already approved by the Court.

PG&E submits that the Agreements are in the best interest of the
estate because they provide, not just for the amendment and
assumption of SPI's PPAs, but also the resolution of all
disputes between SPI and PG&E, including the State Court Action,
the Appeal and SPI's Claim.

Judge Phillips remarks that while neither PG&E nor the ISO has
ever believed that SPI's non-contractual claims had validity,
there was a risk that the State Court Action could have resulted
in a finding that PG&E was liable for SPI's lost profits.  The
lost profits claimed by SPI amount to over $86 million.  SPI
also claimed interest at 7% in both the State Court Action and
as part of its Claim.

Under the Settlement and Assumption Agreements, PG&E avoids
having to pay any lost profit damages to SPI.  Moreover, PG&E
avoids any risk that SPI could have recovered on its claim for
punitive damages.

In addition, the Settlement and Assumption Agreements enable
PG&E to save substantial litigation costs associated with
defending the State Court Action, prosecuting its Appeal, and
defending the Claim. PG&E's counsel in the State Court Action
estimated that it would cost PG&E between $2-3 million to
litigate just the State Court Action through trial, not
including an appeal.

Both the Debtor and Judge Phillips concluded that the Settlement
Agreement was a reasonable and prudent alternative to the risks
and expenses of continued litigation.

After considering the risks, complexity and expense associated
with further litigation of the disputes, the Debtor has
determined that the proposed Settlement and Assumption
Agreements are fair, reasonable and equitable and in the best
interests of the estate and its constituencies.

The Agreements require the approval of both the Bankruptcy Court
and the California Public Utilities Commission.  Approval must
be obtained on or before October 4, 2002 according to the terms
of the Settlement Agreement or the Agreements will be deemed
null and void.

Accordingly, concurrent with the filing of this Motion, PG&E is
filing an application with the CPUC to obtain its approval.
(Pacific Gas Bankruptcy News, Issue No. 42; Bankruptcy
Creditors' Service, Inc., 609/392-0900)    


PACIFIC GAS: District Court Reverses Preemption Decision
--------------------------------------------------------
Pacific Gas and Electric Company issued the following statement
after the U.S. District Court reversed the U.S. Bankruptcy
Court's preemption decision:

    "[Fri]day's ruling is consistent with our interpretation of
bankruptcy statutes, which PG&E believes expressly preempt state
law to allow the Bankruptcy Court to fully implement our
reorganization plan.  While we are still reviewing the 37-page
decision, we are pleased with the federal district court's
ruling.

    "PG&E's plan of reorganization seeks to preempt only a
limited number of state laws and regulations necessary to allow
it to emerge from bankruptcy. The reorganized utility and the
three new companies would be subject to all applicable federal,
state and local laws, including environmental and public health
and safety regulations."


PG&E CORP: Obtains New Waiver Extension Until October 4, 2002
-------------------------------------------------------------
PG&E Corporation (NYSE: PCG) and lenders under the $420 million
Tranche B of the Corporation's $1.02 billion term loan agreement
reached an agreement that, among other things, extends through
October 4, 2002, the waiver of the requirement that PG&E
National Energy Group maintain an investment grade credit rating
from either Standard and Poor's or Moody's Investors Service.
The terms and conditions of the new waiver agreement will be
detailed in an 8-K which the Corporation intends to file later
today with the U.S. Securities and Exchange Commission.

Also, the Corporation fully repaid the principal and interest on
Tranche A of the loan to General Electric Capital Corporation,
totaling $606 million.  The Corporation anticipates its cash
balance at the end of the third quarter of 2002 will be
approximately $200 million including certain reserves required
under the terms of the loan agreement.  The Corporation's cash
balance remains sufficient to fund its ongoing operations.
Please visit its Web site at http://www.pgecorp.com


PRINTERA CORP: Closes US Operations and Consolidates in Canada
--------------------------------------------------------------
Printera Corporation (PAC:TSX) announced its operating results
for the third quarter ended June 30, 2002.  

In response to continuing losses in its U.S. operation, the
company has consolidated its operations in Canada and will close
the U.S. facility. As a result the U.S. operations have been
presented as discontinued operations.

Revenue declined 16% to $10.4 million from $12.4 million in
2001. EBITDA was $0.8 million for the quarter, compared to $2.0
million in the previous year. These results reflect the impact
of the loss of a major customer.

The company incurred a one time write down of $27 million to
reflect the realizable values of the company's investment and
other non-operating assets. The write down, combined with losses
on discontinued U.S. operations and company restructuring
charges, produced a net loss of $31.7 million for the quarter
and $32.5 million for the first three quarters of fiscal 2002,
compared to a profit of $10,000 and a loss of $848,000
respectively for 2001.  

The company continues to explore options to raise capital that
will be used to repay interim financing, to restore working
capital, and to rebuild the equity base of the company.  

Printera is a producer of high-quality custom labels focusing on
the beverage and food industries.


QWEST COMMS: S&P Lowers Ratings on Three Synthetic Transactions
---------------------------------------------------------------
Standard & Poor's Ratings Services today lowered its ratings on
three synthetic transactions related to Qwest Communications
International Inc., and its subsidiaries.

Concurrently, the CreditWatch status on the three transactions
is revised to CreditWatch with negative implications from
CreditWatch with developing implications.

The lowered ratings and CreditWatch revisions reflect the
Aug. 27, 2002 downgrade of Qwest Communications International
Inc., and its subsidiaries' long-term corporate credit and
senior unsecured debt ratings.

PreferredPLUS Trust Series QWS-1 and PreferredPLUS Trust Series
QWS-2 are swap-independent synthetic transactions that are weak-
linked to the underlying collateral, Qwest Capital Funding
Inc.'s (formerly U.S. West Capital Funding Inc.) debt. The
lowered ratings and CreditWatch revisions regarding these two
transactions reflect the credit quality of the underlying
securities issued by Qwest Capital Funding Inc., and guaranteed
by Qwest Communications International Inc.

CorTS Trust for U.S. West Communication Debentures is a swap-
independent synthetic transaction that is weak-linked to the
underlying collateral, Qwest Corp.'s (formerly U.S. West
Communications Inc.) debt. The lowered rating and CreditWatch
revision regarding this transaction reflects the credit quality
of the underlying securities issued by Qwest Corp.

          Ratings Lowered/Creditwatch Placements Revised

                 PreferredPLUS Trust Series QWS-1
           $40 million trust certificates series QWS-1

                                  Rating
          Certificates      To                From
                            CCC+/Watch Neg    B/Watch Dev

                 PreferredPLUS Trust Series QWS-2
           $38.75 million trust certificates series QWS-2

                                  Rating
                            To                From
          Certificates      CCC+/Watch Neg    B/Watch Dev
     
          CorTS Trust for US West Communication Debentures
          $40.565 million corporate-backed trust securities

                                  Rating
                            To                From
          Certificates      B-/Watch Neg      B+/Watch Dev

Qwest Corp.'s 7.625% bonds due 2003 (QUS03USS9) are trading at
93 cents-on-the-dollar, DebtTraders reports. See
http://www.debttraders.com/price.cfm?dt_sec_ticker=QUS03USS9for  
real-time bond pricing.


RECOTON: Gets Waivers of Default & Loan Purchase Pact Amendments
----------------------------------------------------------------
Recoton Corporation (Nasdaq: RCOT), a leading global consumer
electronics company, has received waivers of default and loan
and securities purchase agreement amendments from its lenders
and noteholders. The Company has submitted for filing a Form 8-K
with the Securities and Exchange Commission that includes
documents related to these waivers and amendments.

The Company has also provided pro-forma statements of operations
for the three and six-month periods ended June 30, 2002, and
pro-forma balance sheet data at June 30, 2002. This pro-forma
information is being provided to illustrate what Recoton's
results would have been had the Company obtained the waivers and
amendments by June 30, 2002, the date of our Form 10-Q for the
2nd quarter of 2002. Such pro-forma financial statements have
not been reviewed by Recoton's accountants and do not constitute
an amendment of the financial statements included in the
Company's previously filed Form 10-Q for the period ended June
30, 2002. These previously filed financial statements reflected
the situation as it existed at the time that such Form 10-Q was
filed.

Robert L. Borchardt, Chairman, President and Chief Executive
Officer of Recoton Corporation, commented, "We are very pleased
to have resolved this issue and appreciate the continued support
of our lenders. These waivers and amendments should provide
adequate liquidity for Recoton as we enter the holiday selling
season and beyond. We would also like to thank our vendors,
customers and shareholders for their support during this period.
Recoton remains focused on providing high quality products and
unmatched customer service, and enhancing shareholder value."

Mr. Borchardt concluded, "As previously announced, we have
substantially completed the restructuring at our video game
segment, thus reducing the drag that this business segment has
had on overall operating results. This restructuring, combined
with continued profitability at our consumer electronics
accessories and audio segments, should produce improved
operating results in the second half of 2002. Additionally, and
as previously announced, the asset sales that are planned to
occur should further serve to strengthen Recoton's financial
position by allowing us to reduce debt and improve liquidity."

Recoton Corporation is a global leader in the development and
marketing of consumer electronic accessories, audio products and
gaming products. Recoton's more than 4,000 products include
highly functional accessories for audio, video, car audio,
camcorder, multi-media/computer, home office and cellular and
standard telephone products, as well as 900MHz wireless
technology products including headphones and speakers;
loudspeakers and car and marine audio products including high
fidelity loudspeakers, home theater speakers and car audio
speakers and components; and accessories for video and computer
games. The Company's products are marketed under three business
segments: CE Accessory, Audio and Gaming.


RESOURCE RECOVERY: Inks Fuel Tax Credit Multilateral Settlement
---------------------------------------------------------------
Resource Recovery International Corporation (Pink Sheets: RRIC)
has signed a multilateral settlement ending the three years of
litigation that had entangled its interest in the Somerset
Synfuels No 1, LLC's IRS Section 29 Alterative Fuel Tax Credit
Program.

E. C. Kane, the President and CEO of RRIC, referred to the
settlement as a grand accord and release. He said it ended
costly litigation, compromised and settled issues among multiple
parties, and most importantly, safeguarded RRIC's financial
interest in Somerset Synfuel's Section 29 Tax Credit Program.
Mr. Kane indicated that this settlement, 3 years in the making,
had become a top priority in the financial restructuring of the
Company. "As a result of the settlement RRIC is now positioned
for significant growth through acquisitions and joint ventures."

Mr. Kane said he expected the Company would receive its first
distribution of proceeds within days while subsequent quarterly
payments would begin on October 10th and continue for many years
to come. Although the specifics were not released, Mr. Kane
stated that the projected income from this tax credit program
would significantly enhance the financial health of the Company
and result in a positive operational earnings report for the
fiscal year of 2002.

RRIC is in the business of developing products and technologies
in the environmental and recycling industries, with specific
emphasis on the recovery and recycling of non-ferrous metals.  
Focused on providing solutions that alleviate the world wide
environmental dilemma of industrial waste, Resource Recovery is
expanding its core activities to create compelling applications
to generate demand for its products.  The Company conducts most
of its operations through several subsidiary companies:
Diversified Resources International, Thomson Recovery
Corporation, Diversified Resources-US, and Diversified
Environmental Products, as well as a twenty percent interest in
Somerset Synfuels N0. 1 LLC.


RETURN ASSURED: Goldstein Golub Raises Going Concern Doubt
----------------------------------------------------------
According to the July 22, 2002 Auditors Report of Goldstein,
Golub, Kessler, LLP, of New York, EliteJet, Inc., and
Subsidiaries (successor to Return Assured Inc.) has sustained
recurring net operating losses and has a shareholders' deficit.
In addition, the holders of the preferred stock currently have
the right to redeem their shares for cash in an amount which
exceeds currently available funds.  These factors raise
substantial doubt about  the Company's ability to continue as a
going concern.

EliteJet, Inc., was incorporated under the laws of the State of
Nevada on November 16, 1999. The Company was formed to acquire,
own, and operate jet air transportation. The company and its
subsidiary, Elite Jet Partners, LLC, provide charter services
throughout North America and the Caribbean.

The Company financial statements are prepared giving effect to
the acquisition of Return Assured Incorporated, a Delaware
Corporation and Subsidiaries (effective April 26, 2002) by
EliteJet Nevada, an increase in the number of authorized shares
from 51,000,000 (50,000,000 common and 1,000,000 preferred) to
105,000,000 shares (100,000,000 common and 5,000,000 preferred),
a 1 for 60 reverse stock split, and the change of the name of
Return Assured Delaware to EliteJet, Inc. The Board of Directors
of Return Assured Delaware and its majority stockholders
approved these corporate actions on April 25, 2002 and prior.
The approval by Return Assured Delaware's Board of Directors and
the majority stockholders is adequate under Delaware law to
effect these corporate actions. The corporate actions will not
become effective until 20 days after Return Assured Delaware has
mailed an information statement to its stockholders.
Stockholders of Return Assured Delaware have no right under
Delaware Law or Return Assured Delaware's certificate of
incorporation or bylaws to dissent these corporate actions. To
date, the information statement has not been declared effective
by the Securities and Exchange Commission and as such, has not
been mailed to Return Assured Delaware's stockholders. However,
since no further decisions by the Company need to be made
regarding these corporate actions, the Company has accounted for
them effective April 26, 2002.

On April 26, 2002, EliteJet Nevada, through a reverse triangular
merger, became the accounting parent and the legal subsidiary of
Return Assured Delaware. Return Assured Delaware issued
7,000,000 shares of its stock to the shareholder of EliteJet
Nevada in exchange for his shares of EliteJet Nevada in the
Merger Transaction. On April 25, 2002, Return Assured Delaware's
assets amounted to $2,795,724, liabilities amounted to
$1,221,355 and Redeemable Preferred Stock amounted to
$2,828,873. Return Assured Delaware's name will now be EliteJet,
Inc., a Delaware corporation. As a result, the former
subsidiaries of Return Assured Delaware became wholly owned
subsidiaries of EliteJet Delaware. The merger was accounted for
as a capital transaction, accompanied by a  recapitalization.
The consolidated statements of operations and cash flows include
the activity of Return Assured Delaware and its subsidiaries
only since the date of the merger. The consolidated financial
statements include the following companies, EliteJet Nevada,
EliteJet Delaware, Elite Jet  Partners, Return Assured
Incorporated (a Nevada Corporation), and Edutec Computer
Education Institute, Inc.  At the date of the merger, Return
Assured Nevada and Edutec were inactive companies.

EliteJet is in the business of operating a  ractional aircraft
ownership program.  It sells  ownership interests in a limited
liability company which entitles the purchaser to utilize its
aircraft for a specified number of flight hours per year.  In
addition, it provides management, ground support and flight
operation services to customers after the sale.  Its revenues
derive from management and usage fees charged to clients in
connection with flight operations.  Its programs are designed to
offer customers guaranteed availability of aircraft, lower and
predictable operating  costs and liquidity.

On April 26, 2002, when our predecessor company, Return Assured
Incorporated, agreed to acquire all of the stock of EliteJet,
Inc. the transaction gave Elite access to all of the cash on
hand of Return Assured to continue EliteJet'd aircraft charter
business.

Charter revenue increased from $132,990 during the three months
ended June 30, 2001 to $877,349 during the three months ended
June 30, 2002. The increase was due to the commencement of
charter operations during 2001, while during 2002 the Company
was fully operational during the entire three month period. Cost
of sales increased from $99,548 during the three months ended
June 30, 2001 to $461,266 during the three months ended June 30,
2002. This increase corresponded to EliteJet becoming fully  
operational during 2002.

Operating expenses consist of selling expenses, general and
administrative expenses, and depreciation expense. Operating
expenses were $537,484 during the three months ended June 30,
2001 and $625,403 during the three months ended June 30, 2002.  
The slight increase was based on increased operations offset by
a decision to conserve cash for equipment and other hard costs.

During the three month periods ended June 30, 2001 and June 30,
2002, losses from operations were $504,042 and $209,320,
respectively. The loss in the 2001 period was due to the start-
up of operations during that period without any corresponding
income from charter services. As shown above, during the 2002
period EliteJet realized charter revenue of approximately
$877,000 but corresponding increases in cost of  sales and
operating expenses resulted in the loss during this period.

Other expenses were $48,962 during the three months ended June
30, 2001 and $56,567 during the three  months ended June 30,
2002. These other expenses consist primarily of interest and
reflect an increased level of borrowing.

Charter revenue increased from $132,990 during the six months
ended June 30, 2001 to $1,324,316 during the six months ended
June 30, 2002. Cost of sales increased from $169,413 during the
six months ended June 30, 2001 to $1,128,663 during the six
months ended June 30, 2002. This increase corresponded to  
becoming fully operational during  2002.

Operating expenses consist of selling expenses, general and
administrative expenses, and depreciation expense. Operating
expenses were $782,830 during the six months ended June 30, 2001
and $1,128,668 during the six months ended June 30. 2002. The
increase was based on increased operations offset by a decision
to conserve cash for equipment and other hard costs.

During the six month periods ended June 30, 2001 and June 30,
2002, losses from operations were $819,253 and $812,306,
respectively. During the 2002 period EliteJet realized charter
revenue of  approximately $1,324,316 but corresponding increases
in cost of sales and operating expenses resulted in the loss
during this period.

Other expenses were $91,492 during the six months ended June 30,
2001 and $100,831 during the six months ended June 30, 2002. As
shown above, these other expenses consist primarily of interest,
and reflect an increased level of borrowing.

As of December 31, 2001, EliteJet had cash of $341,899 and
accounts receivable of $220,053.  At the  end of its first
quarter, on March 31, 2002, it had a cash overdraft of $1,882
and accounts receivable of $42,116. The Company recognized the
need for immediate capital in order to continue operations.
After exploring all alternatives, EliteJet entered into the
transaction with Return Assured under which Return Assured
acquired all of EliteJet's outstanding stock. As of June 30,
2002, EliteJet had  cash on hand of $49,060 and unrestricted
cash held by an attorney of $2,791,752.

The Company now believes that cash on hand will allow it to
continue with planned operations for a  period of two years.  
Cash will be used to pay all operating expenses.  Aircraft will
in all likelihood not be acquired unless they can be leased or
obtained with seller or third party financing. Acquisition of
aircraft by these methods, as compared to being purchased for
cash, allows EliteJet to pay for the cost of aircraft over time
as income from charter operations is earned.

As to the issue raised by the Company's auditors regarding the
ability to continue as a going concern management believes that
access to the cash on hand of Return Assured will provide it
with the working capital to continue its aircraft charter
business. Management also believes that its preferred
shareholders will not seek to redeem their shares out of funds
needed for the Company's continued operation.


ROHN INDUSTRIES: Signs Amendment to Credit & Forbearance Pacts
--------------------------------------------------------------
ROHN Industries, Inc. (Nasdaq: ROHN), a global provider of
infrastructure equipment for the telecommunications industry,
has entered into an amendment to its credit and forbearance
agreements with its bank lenders.  The amendment to the credit
agreement, among other things, modifies the definition of the
borrowing base to restrict the Company's access to $1,500,000 of
borrowing capacity and imposes certain additional information
requirements on ROHN.  

Under the amendment to the forbearance agreement, the bank
lenders have agreed to extend until October 31, 2002 the period
during which they will forbear from enforcing any remedies under
the credit agreement arising from ROHN's breach of financial
covenants contained in the credit agreement.  If these financial
covenants and related provisions of the credit agreement are not
amended by October 31, 2002, and the bank lenders do not waive
any defaults by that date, the bank lenders will be able to
exercise any and all remedies they may have in the event of a
default.

ROHN Industries, Inc., is a leading manufacturer and installer
of telecommunications infrastructure equipment for the wireless
and fiber optic industries.  Its products are used in cellular,
PCS, fiber optic networks for the Internet, radio and television
broadcast markets.  The company's products include towers,
equipment enclosures, cabinets, poles and antennae mounts, as
well as design and construction services.  ROHN has
manufacturing locations in Peoria, Ill.; Frankfort, Ind.; and
Bessemer, Ala., along with a sales office in Mexico City,
Mexico.


SAFETY-KLEEN: Systems Wants to Sell 3E Company Stake for $12MM
--------------------------------------------------------------
Safety-Kleen Systems Inc., seek the Court's authority to:

    (i) vote its 604,000 shares of stock in 3E Company
        -- Environmental, Ecological and Engineering --
        approving the sale of substantially all of the
        assets of 3E Company to New 3E Company Acquisition
        Corporation under an Asset Purchase Agreement, and

   (ii) enter into an Asset Purchase Agreement providing
        for the sale of substantially all of the assets of
        3E Company and the purchase of 24.22% of 3E Company
        stock by SKS, and

  (iii) assume and assign 3E's contracts and unexpired leases.

The Debtors believe they can maximize the value of their equity
interest in 3E Company by selling their interests.

Beginning in April 2000, 3E Company mounted a significant effort
to identify and contact potential purchasers.  As its investment
banker, First Analysis contacted over 20 potential strategic and
financial buyers, of which 15 signed non-disclosure agreements
and, in turn, received confidential offering memoranda and/or
additional confidential materials.  Although proposals from the
potential buyers were received in late 2000, the shareholders of
3E Company concluded that all of the proposals submitted
provided inadequate consideration.  Subsequently, in April 2001,
"best and final" proposals were received from each of the three
potential buyers.  But the 3E Company shareholders were unable
to consummate a transaction with any of these parties on
acceptable terms.

In early 2002, the existing management of 3E Company offered to
buy the assets of 3E Company.  The terms offered were as
favorable, if not more so, than any previous alternative.  It
also provided the Debtors with an attractive opportunity to
liquidate its equity interest.

On June 3, 2002, New 3E Acquisition Corporation, 3E Company, and
Safety-Kleen Systems signed a Letter of Intent for the purchase
of the 3E Company assets.  The parties then negotiated the terms
of an Asset Purchase Agreement.

In order to enter into the Asset Purchase Agreement and
effectuate a sale of substantially all the assets of 3E Company
-- a California corporation, a majority of 3E Company's
shareholders must vote to approve the Asset Sale under
California law.  Safety-Kleen Systems owns 77.78% of the shares
of 3E Company, and intends to vote these shares in favor of the
transaction.

                    The Asset Purchase Agreement

After good faith and arm's-length negotiations between the
Debtors, 3E Company, the Minority Shareholders, and the
Purchaser, the parties agreed that:

    (1) Purchase Price:

        The total purchase price to be paid by the Purchaser
        is $12,639,218.  Of the total, $9,389,218 of the price
        will be paid in cash at the closing of the transaction
        contemplated by the APA.  The Purchaser will sign and
        deliver to 3E Company a subordinated secured promissory
        note for $3,250,000 at the Closing.  The Note will bear
        interest at the rate of 9% per annum and will be secured
        by all of New 3E's assets, subordinated only to the
        acquisition financing and a working capital line of
        credit not to exceed $3,750,000.

    (2) Purchased Assets:

        -- the lease of real property at 1905 Aston Avenue,
           Carlsbad, California, dated December 17, 1998,
           between EGLL Development LLC of San Diego, CA,
           and Systems;

        -- all equipment and furniture;

        -- all inventories and cash;

        -- all rights under 3E company contracts;

        -- certain intellectual property rights; and

        -- all permits, licenses, certifications and approvals
           from all permitting, licensing, accrediting and
           certifying agencies.

        The Purchased Assets will not include items like:

        -- income tax refunds and tax attributes,

        -- documents relating solely to the organization,
           maintenance and existence of 3E Company as a
           corporation, and

        -- any rights of 3E Company under the APA.

    (3) Assumed Liabilities:

        At the Closing, the Purchaser will assume and
        undertake to pay, perform and discharge when due or
        required to be performed (without duplication) all
        of 3E Company's liabilities, mortgages, indentures,
        claims, liens, expenses or obligations, whether
        actual or contingent, accrued or unaccrued, matured
        or unmatured, relating to agreements, facts, conduct,
        conditions or circumstances in existence on or before
        the Closing, except for Excluded Liabilities.

    (4) Excluded Liabilities:

        The Purchaser does not assume and is not otherwise
        responsible for liabilities, expenses or obligations
        arising out of occurrences before, on or after the
        Closing which include:

        -- any liabilities or obligations owed to SKS or any
           of its affiliates, except for liabilities and
           obligations under the Marketing Agreement dated as
           of December 31, 2001, between 3E Company and SKS,
           which the Purchaser assumes;

        -- any an all ERISA liabilities and certain
           liabilities for taxes;

        -- liabilities payable to First Analysis;

        -- liabilities of 3E Company arising under
           guarantees or similar instruments relating to
           indebtedness for borrowed money incurred by SKS
           or its affiliates, other than 3E Company, other
           than for 3E Company's direct benefit, including
           liabilities of 3E Company as a guarantor under
           the Amended And Restated Credit Agreement among
           LES, Inc., Laidlaw Environmental Services
           (Canada) Ltd., and the lenders and agents under
           that Agreement; and

        -- certain claims covered by insurance policies held
           by SKS or any of its affiliates.

    (5) Purchase of Minority Stockholders' Shares:

        SKS will purchase all 193,000 shares held by
        Minority Shareholders free and clear of all options,
        proxies, voting agreements, judgments, pledges,
        charges, escrows, rights of first refusal or first
        offer, mortgages, and all other types of encumbrances.
        The aggregate purchase price for these shares will be
        $625,062.08.  Following this purchase, SKS will own
        100% of the equity interests of 3E Company. (Safety-
        Kleen Bankruptcy News, Issue No. 44; Bankruptcy
        Creditors' Service, Inc., 609/392-0900)    


SHELDAHL INC: Consummates Bankruptcy Sale to Investors' Group
-------------------------------------------------------------
Sheldahl, Inc., has completed the sale of substantially all of
its continuing business assets to Northfield Acquisition Co., a
new company owned by Sheldahl's three largest shareholders,
Ampersand Ventures, Molex Incorporated and Morgenthaler
Partners. The sale was approved by the Bankruptcy Court on
August 21, 2002 following the company's Chapter 11
reorganization filed on April 30, 2002.

Northfield Acquisition Co., said it will retain the Sheldahl
brand name and will continue to operate the Company's Northfield
facility. Sheldahl's remaining operations in Longmont, Colorado
will be relocated to Northfield and the Longmont plant will be
closed.

"This transaction is the result of a long course of negotiations
with creditors and the buyers and is, in the company's opinion,
a very good result for creditors as well as for employees and
customers," said Benoit Pouliquen, President and Chief Executive
Officer of Sheldahl.

The sale includes a majority of the Sheldahl's operating assets
and contracts necessary to maintaining its operations. The
company said the sale would not result in any residual value for
preferred and common shareholders.


SHENANDOAH RESOURCES: CCAA Protection Extended Until Sept. 13
-------------------------------------------------------------
Shenandoah Resources Ltd. (CDNX: "SNN") announced that the Court
of Queen's Bench of Alberta granted a further extension to
September 13, 2002 of the Interim Order previously granted under
the Companies' Creditors Arrangement Act providing for creditor
protection to Shenandoah and to permit it to continue to develop
a financial restructuring plan to present to its creditors.
Canadian Western Bank, Shenandoah's secured creditor, supported
today's application. Shenandoah's data room will continue to be
open for review by interested parties. Parties interested in
viewing the data room should contact Shenandoah directly.

Shenandoah's shares continue to be halted by the TSX Venture
Exchange pending review of its tier maintenance requirements.


TOWER AUTOMOTIVE: Declares Dividend on 6-3/4% Conv. Preferreds
--------------------------------------------------------------
Tower Automotive, Inc. (NYSE:TWR), announced that a dividend of
$0.84 per share will be paid on the 6-3/4% trust convertible
preferred securities issued by the Tower Automotive Capital
Trust. The dividend will be payable on September 30, 2002, to
stockholders of record on September 15, 2002. The dividend will
be paid on 5,175,000 shares outstanding.

Tower Automotive, Inc., is a global designer and producer of
structural components and assemblies used by every major
automotive original equipment manufacturer, including Ford,
DaimlerChrysler, GM, Honda, Toyota, Nissan, Fiat, Hyundai/Kia,
BMW, and Volkswagen Group. Products include body structures and
assemblies, lower vehicle frames and structures, chassis modules
and systems, and suspension components. The company is based in
Grand Rapids, Mich.

As previously reported, Tower Automotive's June 30, 2002 balance
sheet shows that its total current liabilities exceeded its
total current assets by about $249 million.


TWO WAY TV: May Not Continue Due to "Weak Financial Condition"
--------------------------------------------------------------
On May 31, 2001, Interactive Network, the Company and Two Way TV
Limited, a corporation organized under the laws of England and
Wales, entered into an Agreement and Plan of Reorganization
providing for a merger of Interactive Network into the Company,
with the Company as the surviving corporation. Immediately prior
to the Merger, each share of the Company's common stock was
split at a ratio of 3.5293639 for 1. Concurrent with the Merger,
all shares of the Company held by Interactive Network were
cancelled. The Interactive Network shareholders were issued
45,660,949 shares in exchange for their shares of Interactive
Network common stock. In the Merger, each share of common stock
of Interactive Network was converted into one share of common
stock of the Company, and options and warrants to purchase
Interactive Network common stock and promissory notes
convertible into Interactive Network common stock were converted
into options and warrants to purchase and promissory notes
convertible into the same number of shares of common stock of
the Company under the same conditions. The Merger was accounted
for as a "purchase" transaction for accounting and financial
reporting purposes, in accordance with generally accepted
accounting principles. After the Merger, the results of
operations of Interactive Network were included in the
consolidated financial statements of the Company. The purchase
price was allocated based on the fair values of the assets
acquired and the liabilities assumed by the combined company.

Interactive Network had a pre-acquisition shareholder deficiency
of approximately $3,231,000 at March 31, 2002. The consolidation
recognizes the $614,000 of goodwill that arises from the
combination by bringing the intangible rights of Interactive
Network directly under the ownership of the Company, rather than
the indirect ownership through license that existed prior to
Merger. The remaining $2,617,000 has been charged to additional
paid-in capital $2,192,000 and due to shareholder $425,000. On
August 30, 2001, TWIN Entertainment, Inc. changed its name to
Two Way TV (US), Inc.  The Merger was effective as of April 30,
2002.

Former Interactive Network shareholders as a whole now own
approximately 49% of Two Way TV US issued and outstanding stock,
with the balance held by Two Way TV Limited. As a result of the
merger, Two Way TV US now owns and controls all of Interactive
Network's intellectual property and in particular their patent
portfolio. Following the effective date of the merger, Two Way's
common stock was formally listed on the NASDAQ Over the Counter
Bulletin Board with the ticker symbol TWTV.

Based in Los Angeles, California, the Company dedicates its
resources to developing and supplying technology solutions to
enable enhanced TV games played in conjunction with live and
scheduled television broadcasts.

Over the last six months Two Way has continuously reduced its
operations and within the past two months have suspended all of
its revenue generating operations because the income generated
by its business was not sufficient to sustain these operations.
During its last fiscal year, the Company incurred a net loss of
$3.9 million on a proforma basis and in the quarter ended June
30, 2002, incurred a net loss of $1.8 million and had negative
cash flow from operations of $700,000. In order to resume and
maintain operations for at least one year thereafter, Two Way
estimates that, exclusive of currently outstanding debt, it will
require financing of approximately $2 million, although there is
no assurance that this amount will be adequate for this purpose.
The Company is investigating the possibility of merging or
otherwise affiliating with a business that could benefit from
the use of Two Way's technology and patents, but currently it
has not identified any such business. Any such merger or
affiliation will also most likely require significant financing.
The Company has recently borrowed $300,000 from Two Way TV
Limited in the form of an unsecured one-year convertible note
which bears interest at the maximum rate allowed by law. Of this
amount $150,000 was received prior to June 30, 2002. Two Way TV
Limited has offered to extend another $150,000 to the Company,
subject to its agreement to secure the entire loan amount with
its intellectual property and its ability to obtain certain
waivers from the holders of $1.625 million in notes issued by
Interactive Networks in June 2001. Two Way is considering this
offer. The Company currently has no commitments for any
additional financing and may be unable to raise needed cash on
terms acceptable to it, if at all. Financings may be on terms
that are dilutive or potentially dilutive to  stockholders.
Further, the Company's weak financial condition could restrict
its ability to merge or affiliate with a business partner as
well as prevent it from establishing a source of financing. If  
unable to secure the financing required to support its
activities by September 2002, the Company will most likely cease
all operations.

Two Way TV US recorded $182,900 of revenue in the three month
period ended June 30, 2002 compared to $0 in the three month
period ended June 30, 2001. It recorded $182,900 of revenue in
the six months ended June 30, 2002 compared to $0 in the six
months ended June 30, 2001. Its revenue was generated from a
combination of accrued license fees from Two Way TV Limited and
non recurring revenue for development from Liberate Technologies
and digeo, inc.

Selling, general and administrative expenses were $1,124,378 for
the three months ended June 30, 2002 and $608,038 for the three
months ended June 30, 2001. Selling, general and administrative
expenses were $1,641,708 in the six months ended June 30, 2002
as compared to $1,457,288 in the six months ended June 30, 2001.
The increases of $516,340 and $184,420, respectively, reflect
the additional expenses resulting from the merger with
Interactive Network.

Interest income was $24,491 for the three months ended June 30,
2002 and $255 for the three months ended June 30, 2001. Interest
income was $24,491 for the six months ended June 30, 2002 and
$836 for the six months ended June 30, 2001. Interest income
consists of interest earned on cash balances and short-term
investments and the increases are due to interest earned on the
Restricted Cash balance held in relation to Liabilities subject
to compromise.

As of June 30, 2002, Two Way believes it had approximately $7.1
million of federal net operating loss carry-forwards for tax
reporting purposes available to offset future taxable income as
compared to $3.7 million of net operating loss carry-forwards as
of June 30, 2001. Such net operating loss carry-forwards begin
to expire in 2015, to the extent that they are not utilized. The
Company has not recognized any current benefit from the future
use of loss carry-forwards since inception. Management's
evaluation of all the available evidence in assessing
realizability of the tax benefits of such loss carry-forwards
indicates that the underlying assumptions of future profitable
operations contain risks that do not provide sufficient
assurance to recognize the tax benefits currently. The net
operating loss carry-forwards could be limited in future years
if there is a significant change in ownership.

As a result of limited operating history and the emerging nature
of its markets, it is difficult to forecast revenues or earnings
accurately. Current and future expense levels are based largely
on its investment plans and estimates of future revenues and
are, to a large extent, fixed. Two Way may be unable to adjust
spending in a timely manner to compensate for any unexpected
revenue shortfall. Accordingly, any significant shortfall in
revenues relative to planned expenditures would have an
immediate adverse effect on business, results of operations and
the Company's financial condition.

Two Way management believes that its current cash will not be
sufficient to meet its anticipated cash needs for working
capital and capital expenditures for the remainder of 2002 and
as noted above, have presently ceased all revenue generating
operations. It is currently seeking to sell additional equity or
debt securities. If additional funds are raised through the
issuance of debt securities, these securities could have rights,
preferences and privileges senior to those accruing to holders
of common stock, and the term of this debt could impose
restrictions on Company operations. The sale of additional
equity or convertible debt securities could result in additional
dilution to stockholders, and there is no assurance that
additional financing will be available in amounts or on terms
acceptable to Two Way, if at all.

Two Way has not been able to meet its ongoing trade obligations
on a current basis, and as a result,  expects that creditors may
file actions against it to recover amounts allegedly due. On
August 9, 2002, an action was filed against it by The Brenner
Group, Inc., in Santa Clara Superior Court, case number CV
810174, for amounts purportedly due for accounting services in
the sum of $18,132.94, plus costs of suit and attorneys fees
incurred. Two Way states that it may consider filing for
protection with the United States Bankruptcy Court, depending on
its efforts to locate additional financing, and the actions
taken by its creditors.

Two Way TV US' financial condition is extremely weak and the
Company may be unable to continue as a going concern.


UNITED AIR: Presents Proposed Labor Cost Concessions to Unions
--------------------------------------------------------------
UAL Corp., (CCC/Watch Dev/--) unit United Air Lines Inc.
(CCC/Watch Dev/--) on August 28 presented its unions with
proposed labor cost concessions of $1.5 billion annually over
six years as part of a plan to save $2.5 billion per year and
avert a threatened bankruptcy filing this autumn. Standard &
Poor's Ratings Services said its ratings on both entities remain
on CreditWatch with developing implications.

Management said it hoped to file a revised application with the
Air Transportation Stabilization Board on Sept. 16 for a $1.8
billion federal loan guaranty if it can reach agreement with
unions, suppliers, and other parties to participate in cost
cutting. The Chicago, Illinois-based company may be prepared to
file the application if it has made substantial progress, but
not yet reached full agreement, on Sept. 16. Still, with heavy
debt payments due starting in mid-November, time to reach
agreement is limited.

"The scale and complexity of reaching concessionary agreements
in a short time, the unions' initial very negative reaction, and
United's long history of difficult labor relations imply that a
bankruptcy filing is more likely than not," said Standard &
Poor's credit analyst Philip Baggaley. The pilots union, which
had reached tentative agreement on a more limited and short-term
package of concessions, sharply criticized the revised proposal.
The machinists and flight attendants unions had rejected
management's earlier plan. The revised proposal, which would
target total cost savings equivalent to about 15% of total
operating and nonoperating costs, is similar in relative scale
to that of US Airways, but relies slightly less on labor cost
savings.

The Air Transportation Stabilization Board gave tentative
approval to a federal loan guaranty for US Airways, based on the
overall business plan, but not on the composition of cost
savings to be achieved, and would very likely do the same for
United if management can deliver the targeted savings. Whether a
more limited plan, negotiated with labor and other stakeholders,
would be acceptable is less clear. UAL's situation is clouded
further by the absence thus far of a designated successor to
interim CEO John W. Creighton, Jr.

Standard & Poor's ratings could be lowered if progress toward a
financial restructuring does not materialize, or if such a plan
includes defaulting on debt instruments; alternatively, ratings
could be raised if such a plan is concluded successfully.


US AIRWAYS: Bringing-In KPMG as Auditors and Tax Advisors
---------------------------------------------------------
Pursuant to Section 327(a) of the Bankruptcy Code, US Airways
Group seeks the Court's permission to employ KPMG LLP as its
auditors and tax advisors.  KPMG's extensive experience and
knowledge in the field of accounting, particularly in the
context of complex Chapter 11 reorganizations, makes it well
qualified to provide auditing services to the Debtors.

Robert A. Fenimore, CPA and KPMG partner, tells the Court that
for several years, KPMG has served as the independent
accountant, auditor, and tax advisors to the Debtors.  By virtue
of its prior engagement, KPMG is familiar with the books,
records, financial information and other data maintained by the
Debtors and is well qualified to continue to provide continued
services.

The Debtors anticipate that KPMG will:

  (a) audit and review examinations of the financial statements
      of the Debtors as may be required from time to time;

  (b) analyze accounting issues and advise the Debtors'
      management regarding the proper accounting treatment of
      events;

  (c) assist in the preparation and filing of the Debtors'
      financial statements and disclosure documents required by
      the Securities and Exchange Commission;

  (d) assist in the preparation and filing of the Debtors'
      registration statements required by the Securities and
      Exchange Commission in relation to debt and equity
      offerings;

  (e) review and assist in the preparation and filing of
      tax returns;

  (f) advise and assist the Debtors regarding tax planning
      issues, including assistance in estimating net operating
      loss carryforwards, international taxes, and state and
      local taxes;

  (g) assist regarding transaction taxes, state and local
      sales and use taxes;

  (h) assist regarding tax matters related to the Debtors'
      pension plans;

  (i) assist regarding real and personal property tax
      matters, including review of real and personal property
      tax records, negotiation of values with appraisal
      authorities, preparation and presentation of appeals to
      local taxing jurisdictions and assistance in litigation of
      property tax appeals;

  (j) assist regarding any existing or future Internal
      Revenue Service, state and/or local tax examinations;

  (k) provide other consulting, advice, research, planning or
      analysis regarding tax issues as may be requested;

  (l) advise and assist on the tax consequences of proposed
      plans of reorganization, including assistance in the
      preparation of IRS ruling requests regarding the future
      tax consequences of alternative reorganization structures;
      and

  (m) perform other related accounting and tax services
      for the Debtors as may be necessary or desirable.

Mr. Fenimore relates that KPMG searched its client database from
1998 and forward to identify any connection or relationship with
these entities:

(a) The Debtors and their affiliates;
(b) The Debtors' officers and directors;
(c) The equity shareholders with more than 20% of common stock;
(d) The Debtors' major secured creditors;
(e) The Debtors' largest unsecured creditors;
(f) The Debtors' counsel and Investment Banker; and
(g) Financial advisors and counsel to other parties-in-interest.

Mr. Fenimore is confident that KPMG does not hold or represent
an interest adverse to the estates that would impair its ability
to objectively perform professional services for the Debtors, in
accordance with Section 327 of the Bankruptcy Code.

KPMG received $1,031,981 from the Debtors within 90 days of the
bankruptcy filings.  KPMG believes that these payments are not
preferences.  KPMG is a "disinterested person" as defined in
Section 101(14) of the Bankruptcy Code and modified by Section
1107(b), Mr. Fenimore asserts.

According to Mr. Fenimore, KPMG has in the past been retained
by, and presently and likely in the future will provide services
for, the Debtors' creditors, other parties-in-interest and their
respective attorneys and accountants in matters unrelated to the
parties' claims against the Debtors or interests in these
Chapter 11 cases.

KPMG's compensation for professional services rendered to the
Debtors will be based on the hours expended by each assigned
staff member at the corresponding hourly billing rate.  The
Debtors have agreed to compensate KPMG for professional services
rendered at its normal and customary hourly rates.  In the
normal course of business, KPMG revises its hourly rates on
October 1 of each year.  The current customary hourly rates for
accounting and tax services by KPMG are:

      Accounting and Audit Services:  Hourly Rate
      ------------------------------  -----------
      Partners/Principals             $500 - 650
      Managing Directors/Directors     500 - 600
      Senior Managers/Managers         325 - 600
      Senior/Staff Consultants         225 - 325
      Associates                       175 - 200
      Paraprofessionals                100 - 110

      Tax Advisory Services:
      ----------------------
      Partners/Principals/Directors   $500 - 750
      Senior Managers/Managers         375 - 675
      Senior/Staff Consultants         175 - 350

      Tax Compliance Services:
      ------------------------
      Partners/Principals/Directors   $500 - 600
      Senior Managers/Managers         375 - 500
      Senior/Staff Consultants         175 - 350

David N. Siegel, Chief Executive Officer of US Airways Group,
believe that KPMG's fees are fair and reasonable in light of:

    -- industry practice,
    -- market rates both in and out of Chapter 11 proceedings,
    -- KPMG's experience in reorganizations, and
    -- KPMG's importance to these cases.

KPMG has not received a prepetition retainer from the Debtors.
Before the Petition Date, KPMG was not owed any amounts for
services rendered to the Debtors.  KPMG will also seek
reimbursement for necessary expenses incurred, which include
travel, photocopying, delivery service, postage, vendor charges
and other out-of-pocket expenses incurred in providing
professional services.

KPMG intends to apply to the Court for compensation and
reimbursement of expenses in accordance with Bankruptcy Code
Section 330(a), the Federal Rules of Bankruptcy Procedure. (US
Airways Bankruptcy News, Issue No. 3; Bankruptcy Creditors'
Service, Inc., 609/392-0900)


USG CORP: Asks Court to Restrict Plan Voting to Sick Claimants
--------------------------------------------------------------
Richard I. Werder, Jr., Esq., at Jones, Day, Reavis & Pogue,
explains that USG Corporation, and its debtor-affiliates expect,
as these cases progress, to propose and confirm a Plan of
Reorganization, satisfying the requirements of Section 524(g) of
the Bankruptcy Code and qualify for the Congressionally
authorized supplemental injunction.

As the Debtors see it, one of the hurdles to Plan confirmation
is the proposition that bankruptcy law affords counsel to
claimants allegedly exposed to asbestos, but who aren't sick, an
effective "veto right" when it comes time to vote on any
proposed Plan, and "that these counsel must be appeased."

Mr. Werder asserts that the "blocking power" of asbestos
claimants who are, in fact, not sick is illusory and he contends
Judge Newsome should "say so now."   Unimpaired claimants with
an asbestos case outside of bankruptcy are not treated
procedurally as having a present right to payment.  The Third
Circuit has held that persons that are not sick do not have
claims for bankruptcy purposes.  These unimpaired asbestos
plaintiffs, under federal and state law, both substantively and
procedurally mandates a conclusion that those persons do not
have voting power and control over a bankruptcy plan of
reorganization.

The Debtors the Court to declare that persons who wish to vote
on a plan of reorganization be required to "satisfy objective
medical criteria of impairment."  A declaration like this will:

      * clarify who is entitled to vote on the plan and

      * ensure that the plan's terms will not be dictated by
        lawyers representing hoards of unimpaired plaintiffs.

The declaration will also ensure that unimpaired plaintiffs'
right are protected by the future claimants' representative's
input and participation.  No one's right to submit and pursue a
claim against a plan-established trust will be affected by this
type of declaration.

Mr. Werder proposes that, after this initial declaration,
proceedings can be held to determine specific medical criteria
to implement this voting ruling.  The Debtors are not asking the
Court to review any claimant's medical conditions at this time.
(USG Bankruptcy News, Issue No. 32; Bankruptcy Creditors'
Service, Inc., 609/392-0900)


VIASYSTEMS: Will File for Prepack. Chapter 11 Reorg. Late Sept.
---------------------------------------------------------------
Viasystems Group, Inc., (OTCBB:VSGI) has reached final agreement
with its bank lenders, Hicks, Muse, Tate & Furst Incorporated,
and an Ad Hoc Committee of Bondholders regarding its previously
announced financial restructuring. The restructuring will
involve the exchange of approximately $740 million of
Viasystems' debt into common and preferred stock. Upon
completion of the restructuring, Viasystems' debt, net of cash,
will decline from approximately $1.1 billion to approximately
$380 million and interest will be reduced by approximately $70
million annually. The parties to the restructuring agreement
include all of Viasystems bank lenders, holders of 100% of
Viasystems' 14% Senior Notes and holders of 72.8% of Viasystems'
9.75% Senior Subordinated Notes.

Viasystems expects to commence the formal process of soliciting
consents from creditors for the restructuring. Once the
necessary consents are received, the financial restructuring
will be finalized through a voluntary prepackaged bankruptcy
proceeding under Chapter 11 of the U.S. Bankruptcy Code. That
proceeding is expected to be filed in late September, with the
objective of consummating the restructuring in mid-November.

Viasystems has now secured sufficient agreements to the
restructuring to meet the requirements of the Bankruptcy Code
for confirmation of the restructuring plan. Viasystems will
continue business as usual through its operating subsidiaries,
which will not be party to the reorganization proceeding.
Consequently, it is anticipated that customers, employees and
suppliers will not be affected by the restructuring.

"Viasystems has voluntarily chosen a pre-packaged, court-
assisted reorganization as the means to complete our
recapitalization with the most speed and certainty possible,"
said David M. Sindelar, Viasystems' chief executive officer.
"[Fri]day's announcement represents the final ingredient needed
to complete the recapitalization, and this strategy benefits our
customers, suppliers and employees," Sindelar said.

"We are also grateful to our senior lenders, noteholders and
Hicks, Muse, Tate & Furst, all of whom have agreed to support
our restructuring plan. Their support is truly a vote of
confidence in our business model, our management team and our
prospects," Sindelar said.

Under the terms of the restructuring, Viasystems' senior secured
bank debt will be reduced to approximately $450 million ($370
million net of estimated cash) through repayments from $77.4
million in proceeds from sales of senior convertible preferred
stock and common stock representing in the aggregate up to 23.5%
of the company's fully diluted common stock (excluding a
management incentive plan and warrants issued pursuant to the
plan). Viasystems' 14% Senior Notes will be exchanged for junior
preferred stock with a liquidation preference of $120.1 million
and 6.3% of the company's common stock, determined on a fully
diluted basis (excluding a management incentive plan and
warrants issued pursuant to the plan). Viasystems' 9.75% Senior
Subordinated Notes will be exchanged for up to 70.2% of the
company's common stock, determined on a fully diluted basis
(excluding a management incentive plan and warrants issued
pursuant to the plan). Subject to approval of the plan by the
general unsecured creditors of Viasystems Group, Inc., such
creditors will receive in exchange for their claims warrants to
purchase 0.6% of the company's common stock, determined on a
fully diluted basis, and the holders of Viasystems' existing
Series A Preferred Stock will receive warrants to purchase 5.4%
of the company's common stock, determined on a fully diluted
basis (in each case excluding a management incentive plan). The
exercise price of the warrants will be based on a $1.15 billion
total enterprise value. Viasystems' existing common stock,
options and warrants will be cancelled and will not receive any
distribution in the restructuring.

Viasystems has secured commitments from its senior lenders for
$37.5 million of working capital financing that will be
available during the reorganization proceeding. Upon completion
of the recapitalization, Viasystems will have a cash balance of
approximately $80 million and a new revolving credit facility of
up to $62 million.

Viasystems Group, Inc., is a leading global EMS provider with
more than 18,000 employees in eight countries, supplying
customers in the telecommunications, networking, automotive and
consumer electronics industries.


VSOURCE INC: Appoints Braden Waverley as New Company President
--------------------------------------------------------------
Braden Waverley, an executive with international management
experience in Asia-Pacific and North America, has been named
President of Vsource, Inc. (OTC Bulletin Board: VSRC), a leader
in providing customized business process outsourcing services to
Fortune 500 and Global 500 companies operating across Asia-
Pacific.

Waverley, who will be based in the company's corporate office in
San Diego, Calif., will assume responsibility for all sales,
marketing, public and investor relations functions of Vsource
and will serve on the company's Executive Committee.

Waverley was most recently with Dell Computer Corporation, where
he was Vice President and General Manager in the company's
Canadian operations. Previously, he held marketing and general
management posts for Dell's business throughout Asia-Pacific.

"We selected Braden to assume this new position at Vsource
because of his excellent background in Asia-Pacific and his
tremendous accomplishments throughout his career," commented
Phil Kelly, co-chairman and chief executive officer of Vsource.

"I have personal knowledge of Braden's track record at Dell and
Motorola and believe he will assume a strong role at Vsource as
we continue to implement our business model in the Asia-Pacific
region," Kelly added.

Waverley's most recent assignment for Dell, in Toronto, Canada,
included full responsibility for Dell's Home and Small Business
Division, where he led the company to the top market share
position.  Earlier, Dell assigned Waverley to establish the same
division in Asia-Pacific, penetrating markets that included
China, Australia and Southeast Asia.  When Waverley first joined
Dell in 1996, he led all aspects of marketing management across
Dell's direct markets in Asia.

Prior to Dell, Waverley co-founded Paradigm Research, a
successful management consulting firm specializing in business
process automation and redesign strategies.  Clients came from
industries such as computer hardware, software and wireless
technology.  Earlier, Waverley held several management positions
at Motorola, Inc.

Waverley holds a bachelor's degree in political science,
international relations and economics from University of
Wisconsin at Madison, and a master's of business administration
in marketing and operations management from the J.L. Kellogg
Graduate School of Management at Northwestern University.

Vsource, Inc., based in San Diego, Calif., provides business
process outsourcing services -- under the Vsource Versatile
Solutions(TM) trade name -- to Fortune 500 and Global 500
organizations across the Asia-Pacific region.  Vsource Versatile
Solutions include Integrated Technical Service Solutions,
Payroll and Claims Solutions, Sales Solutions and Vsource
Foundation Solutions(TM), which include Financial Services,
Customer Relationship Management and Supply Chain Management.  
Vsource operates shared customer service centers (Vsource
Customer Centers) in Malaysia and Japan and has offices in the
United States, Hong Kong and Singapore.  Vsource clients include
ABN AMRO, Agilent Technologies, EMC, Gateway, Haworth, Network
Appliance and other Fortune 500 and Global 500 companies.

For more information, visit the Vsource Web site:
http://www.vsource.com

At April 30, 2002, Vsource's balance sheet shows a total
shareholders' equity deficit of about $3.4 million.


WARNACO GROUP: Keeps Plan Filing Exclusivity Until September 30
---------------------------------------------------------------
The Warnaco Group, Inc., and debtor-affiliates sought and
obtained a Court order:

  (1) extending the deadline to file a plan of reorganization to
      September 30, 2002;

  (2) extending their solicitation period to November 29, 2002;
      and

  (3) barring any other party-in-interest from proposing and
      filing a plan of reorganization unless and until the Court
      modifies these exclusive periods.

Kelly A. Cornish, Esq., at Sidley Austin Brown & Wood, in New
York, convinced Judge Bohanon that cause exists to extend the
exclusive periods for one month because:

    (a) the 38 Chapter 11 cases are extremely large and complex
        with thousands of creditors and debts exceeding
        $2,000,000,000;

    (b) the Company has successfully stabilized and improved its
        businesses since Petition Date;

    (c) the Debtors have maintained more than adequate liquidity
        to fund operations since the Petition Date, with excess
        cash of $72,000,000 as of August 9, 2002, while
        consistently reducing and, at present, having paid
        completely down all outstandings under the Debtors'
        $600,000,000 DIP Facility;

    (d) the Debtors have made significant progress in executing
        their business plan to facilitate the filing of a
        consensual plan or plans of reorganization; and

    (e) to date, the Debtors have worked cooperatively and
        constructively with their key constituencies with the
        goal of achieving a consensual resolution of these
        cases.

Furthermore, Ms. Cornish states that the Debtors are aiming to
file their plan within a matter of hours.  However, the
extension is sought out of an abundance of caution and to give
the Debtors and their key constituents some flexibility for
changes. (Warnaco Bankruptcy News, Issue No. 31; Bankruptcy
Creditors' Service, Inc., 609/392-0900)  


WORLD WIRELESS: Inks Marketing Agreement with Service Concepts
--------------------------------------------------------------
World Wireless Communications (AMEX: XWC) announced that its has
signed a letter of understanding with Service Concepts to
jointly market and sell World Wireless' Advanced AMR system to
the utility industry.

Under the terms of the agreement, World Wireless and Service
Concepts will jointly develop 'break through solutions' for the
utility industry, which will utilize Service Concepts' market
knowledge and World Wireless' embedded AMR.

"Service Concepts purpose," according to Steve Thrash, CEO, "is
to identify useful products and services that help electric
cooperatives enhance their financial position and form stronger
bonds with their local members. World Wireless achieves both of
these goals, not only adding efficiency but also providing a
platform for highly useful load management services to
commercial and industrial accounts. We are very pleased to help
communicate these opportunities to the cooperative community."

World Wireless' Advanced AMR system is a highly functional,
simple design that utilizes a very powerful 1W under-glass, an
unlicensed radio and low cost data concentrators.  Flexibility
is the key attribute of the system, which uses unlicensed
frequencies for meter-to-Gateway communication and readily
available public networks for Gateway-to-Internet access.  By
capitalizing on existing infrastructure, World Wireless has
developed a two-way Advanced AMR that can be a reality at a
real-world price.

"We are pleased to be working with Service Concepts," stated
David Singer, chief executive officer of World Wireless
Communications and its subsidiary X-traWeb, Inc. "Their industry
expertise combined with our Advanced AMR system will enable us
to provide real-time information on energy usage that will help
consumers and producers of electricity to make better decisions
on energy usage."

The World Wireless AMR system is comprised of two main
components: X-Gate and X-Node.  The X-Node mounts under the
glass of the electric meter and provides a mechanism by which
meter rotations can be counted and the data archived and
uploaded to the X-Gate at user configurable time periods.  The
X-Gate provides a data concentration point for hundreds of X-
Nodes and a means to connect to the Internet for daily uploads
of a batch of meters to the server.

Singer continued, "Energy companies and consumers alike are
concerned with the increasing cost for energy.  Information is
vital to managing those costs and our technology enables utility
companies to provide Time of Use Billing, peak shifting and
better manage their risk."

Service Concepts was created by co-ops, for co-ops to provide
ways to help boost services to local members and encourage
loyalty, while generating new revenues for the co-op's
participating in product and service offerings. Incorporated as
a limited liability company in 1999, Service Concepts is owned
by 28 local electric cooperatives, 2 G and T's and a statewide
association of REMCs. Service Concepts track record is solid,
developing several national vendor agreements and paying over $1
million in cash to participating co-ops in just the last 20
months. Service Concepts product offerings include co-op
branded long distance and Internet services, Maytag Water
heaters, surge and back-up power protection, Verizon Wireless
phones, Careington Health Care Pharmacy/Dental/Vision Discount
Card, prepaid calling cards promoting the Touchstone Energy
campaign, and more. Participating co-ops also qualify for
national account discount pricing on DELL Computers, SHARP
copiers and fax machines, OFS office furniture and more.
Cooperatives need not be a member of Service Concepts to enjoy
great savings on products and turnkey programs suitable for
promoting to their local residential and commercial members.
Contact Service Concepts toll free at 1-877-738-6824 or visit
its Web site at http://www.serviceconcepts.biz

Greenwood Village-based World Wireless Communications, Inc., was
founded in 1995 and is a leading developer of wireless and
Internet systems, technology and products. World Wireless
focuses on spectrum radios in the 900 MHz band and has developed
the X-traWeb(TM) system -- an Internet based product designed
for remote monitoring and control of devices. X-traWeb's many
applications include security systems, vending machines, asset
management, quick service restaurants and utility meters.  More
information on X-traWeb(TM) is available at
http://www.x-traweb.com  More information about World
Wireless Communications, Inc., is available on the company's Web
site, http://www.worldwireless.com

At March 31, 2002, World Wireless' balance sheet shows a total
shareholders' equity deficit of about $5 million.


WORLDCOM: Motorola Asks Court to Require Cash Collateral Acctg.
---------------------------------------------------------------
Joel M. Gross, Esq., at Arnold & Porter, in Washington D.C.,
recounts that on April 1, 2001, Motorola and the WorldCom
Wireless entered into a Unified Wireless Products Supply
Agreement under which WorldCom Wireless agreed to purchase from
Motorola certain wireless phones, phone accessories, pagers, and
consumer and light industrial two-way radios.  Shortly after the
Agreement was executed, Motorola began shipping Products to
WorldCom Wireless.  The Agreement required WorldCom Wireless to
pay for the Products within 30 days after the invoice date.  The
Agreement also granted Motorola a security interest in all of
the WorldCom Wireless' products inventory, as well as accounts,
chattel paper, instruments, contract rights, general
intangibles, accounts receivable, and the proceeds, arising from
the sale or other disposition of the Products.  Mr. Gross
relates that Motorola duly perfected the security interest and
lien by the filing of a UCC-1 with the Arizona Secretary of
State on June 14, 2002.

In the third quarter of 2001, Motorola agreed to extend the
WorldCom Wireless' 30-day payment period to 45 days.  In the
fourth quarter of 2001, the parties revisited invoice terms and
again agreed to extend WorldCom Wireless' invoice term to 45
days.

In April 2002, Mr. Gross recounts that the WorldCom Wireless
advised Motorola that its accounts payable personnel and
processing division, as well as its principal place of business,
would be transferred to the WorldCom Inc.'s corporate offices in
Clinton, Mississippi.  At the same time, the WorldCom Wireless
stopped paying Motorola amounts due to it amounting to
$25,935,973.04, plus interest, for products shipped to it under
the terms of the Agreement.  WorldCom Wireless receives, on a
daily basis, payments constituting Accounts and Proceeds arising
from the sale on other disposition of the Products sold to it by
Motorola.

During the prepetition period, Mr. Gross relates that WorldCom
Wireless transferred all of the money it received to the
WorldCom Inc. on a daily basis.  Under the Debtors' centralized
cash management system, all cash proceeds received by WorldCom
Wireless are transferred daily to WorldCom Inc.  WorldCom
Wireless has not kept the accounts and proceeds separate and
distinct from its other assets, but rather:

    -- has commingled the accounts and proceeds with other
       WorldCom Wireless assets,

    -- is continuing to commingle the Accounts and Proceeds with
       other Wireless assets, and

    -- is utilizing the Accounts and Proceeds without approval
       of this Court.

Motorola has repeatedly attempted to obtain from WorldCom
Wireless an accounting showing which portion of the cash
proceeds received each day are or have been subject to
Motorola's security interest.  However, WorldCom Wireless has
not provided Motorola with any accounting.

On July 10, 2002, Mr. Gross tells the Court that Motorola
commenced an action in the Chancery Court of the First Judicial
District of Hinds County, Mississippi, entitled, Motorola, Inc.
v. WorldCom Inc and WorldCom Wireless, Inc., Civil Action No. G-
2002-1213 0/3.  In that action, Motorola sought an accounting by
WorldCom Wireless as to the Proceeds that were subject to
Motorola's security interest.  No accounting was ever received,
and that action was stayed by this bankruptcy filing before the
Chancery Court could take action.

Pursuant to Section 363 of the Bankruptcy Code, Motorola asks
the Court to require WorldCom Wireless and WorldCom Inc., to
segregate and account for the cash collateral and for adequate
protection.

Mr. Gross contends that the Accounts and Proceeds are Motorola's
Cash Collateral, within the scope of the definition of cash
collateral in Section 363(a) of the Bankruptcy Code.  Pursuant
to Section 363(c)(2) of the Bankruptcy Code, the Debtors are not
authorized to use, sell or lease Motorola's Cash Collateral, as
Motorola has not consented to its use, nor has this Court
authorized it.  Accordingly, the Court should direct the Debtors
that they many not use, sell or lease Motorola's cash
collateral. Motorola expressly reserves all claims that any use
of its Cash Collateral by the Debtors has been and continues to
be without authorization.  Motorola also reserves all right and
remedies with respect thereto.  Pursuant to Section 363(e), the
Court should prohibit any use, sale or lease of Motorola's Cash
Collateral, or in the alternative should condition any use, sale
or lease on the adequate protection of Motorola's interest in
accordance with Section 361 of the Bankruptcy Code.

At a meeting for creditors on July 29, 2002, the Chief Executive
Officer of WorldCom informed creditors that the Debtors were
selling or transferring the accounts of its wireless customers
to four other companies.  In making this motion, Mr. Gross
clarifies that Motorola is not waiving any rights or remedies it
may have with respect to any sale or transfers.  However, given
the possible imminent sale of Debtors' wireless customer
accounts, Motorola will be severely prejudiced if the Debtors
are allowed to operate in the interim without strict compliance
with the requirements of Section 363.

Section 363 provides fundamental protections to secured
creditors from having their cash collateral utilized to their
detriment. Given the fact that:

    -- the Debtors have failed to provide Motorola with any
       accounting as to the amount and location of Motorola's
       Collateral,

    -- it is uncertain how much further cash collateral debtors
       will be receiving, and

    -- the Debtors are apparently in the process of selling the
       accounts, which produce the cash collateral,

Mr. Gross deems it essential that the Court should protect
Motorola's security interest by requiring Debtors to comply with
Section 363. (Worldcom Bankruptcy News, Issue No. 5; Bankruptcy
Creditors' Service, Inc., 609/392-0900)   


XCEL: Sells Remaining Interest in Yorkshire Power Group for $33M
----------------------------------------------------------------
Xcel Energy Inc., has sold its 5.25 percent interest in
Yorkshire Power Group Limited, the parent company of Yorkshire
Electricity Group plc in the United Kingdom, for $33 million.

The sale to CE Electric UK was completed Wednesday last week.

"This sale is another step in rationalizing our asset portfolio
and focusing on our domestic operations," said Dick Kelly, Xcel
Energy's chief financial officer. In the past five weeks, NRG
Energy, a wholly owned subsidiary of Xcel Energy, sold its
stakes in Energy Development Limited and Collinsville Power
Station in Australia. NRG is on track to close on the sales of
its other international assets and selected U.S. assets by year
end, Kelly said.

Xcel Energy and American Electric Power Co., each held a 50
percent interest in Yorkshire, a UK retail electricity and gas
supplier and electricity distributor, before selling 94.75
percent of the company to Innogy Holdings plc in April 2001. CE
Electric acquired Innogy's share of Yorkshire in a separate
transaction in the second half of 2001.

In the 2001 sale, Xcel Energy retained a 5.25 percent interest
in Yorkshire to comply with pooling requirements associated with
the August 2000 merger of Northern States Power Co., and New
Century Energies to form Xcel Energy. Those requirements expired
this month, clearing the way for Xcel Energy to sell its
remaining interest in Yorkshire.

Xcel Energy is a major U.S. electricity and natural gas company
with regulated operations in 12 Western and Midwestern states.
Formed by the merger of Denver-based New Century Energies and
Minneapolis-based Northern States Power Co., Xcel Energy
provides a comprehensive portfolio of energy-related products
and services to 3.2 million electricity customers and 1.7
million natural gas customers through its regulated operating
companies. In terms of customers, it is the fourth-largest
combination natural gas and electricity company in the nation.
Company headquarters are located in Minneapolis. More
information is available at http://www.xcelenergy.com

                        *    *    *

As reported in Troubled Company Reporter's August 7, 2002
edition, Xcel Energy signed agreements with its lenders to
eliminate a cross-default provision in its two bank lines-of-
credit for which Bank of New York serves as agent.

These agreements remove a key provision that had constrained
Xcel Energy's ability to access capital markets due to NRG's
financial condition. Xcel Energy has access to about $200
million remaining on its lines of credit. These lines consist of
two bank facilities of $400 million each, one expiring in
November 2002 and the other in November 2005.

Xcel Energy renegotiated its $800 million bank credit facilities
when it appeared that NRG would be unable to meet cash
collateral demands in the event it were downgraded to below
investment grade. NRG's debt recently was downgraded to below
investment grade by three credit rating agencies.

Xcel Energy continues to focus on improving NRG's financial
strength. NRG is actively working with its lenders to modify the
cash collateral requirements in its current arrangements. Xcel
Energy's immediate goal is to obtain extensions of NRG's
collateral obligations in anticipation of asset sales and other
cash generating measures. As part of the agreements with its
lenders, the company has agreed that its board of directors will
review the company's dividend policy. While the board could
decide to alter the dividend, no decision has been made by the
board.


XCEL ENERGY: Closes $450MM Bond Sale for Northern States Unit
-------------------------------------------------------------
Xcel Energy Inc., completed the sale of $450 million of first
mortgage bonds for its Northern States Power Co.-Minnesota
regulated subsidiary, which serves customers in Minnesota, North
Dakota and South Dakota.

Proceeds will be used to pay down short-term debt and for
current cash needs.

"We were very pleased with the level of participation in this
transaction, and it moves us forward on our goal of improving
our liquidity position," said Dick Kelly, Xcel Energy's chief
financial officer.

Xcel Energy is a major U.S. electricity and natural gas company
with regulated operations in 12 Western and Midwestern states.
Formed by the merger of Denver-based New Century Energies and
Minneapolis-based Northern States Power Co., Xcel Energy
provides a comprehensive portfolio of energy-related products
and services to 3.2 million electricity customers and 1.7
million natural gas customers through its regulated operating
companies. In terms of customers, it is the fourth-largest
combination natural gas and electricity company in the nation.
Company headquarters are located in Minneapolis. More
information is available at http://www.xcelenergy.com

                          *********

Monday's edition of the TCR delivers a list of indicative prices
for bond issues that reportedly trade well below par.  Prices
are obtained by TCR editors from a variety of outside sources
during the prior week we think are reliable.  Those sources may
not, however, be complete or accurate.  The Monday Bond Pricing
table is compiled on the Friday prior to publication.  Prices
reported are not intended to reflect actual trades.  Prices for
actual trades are probably different.  Our objective is to share
information, not make markets in publicly traded securities.
Nothing in the TCR constitutes an offer or solicitation to buy
or sell any security of any kind.  It is likely that some entity
affiliated with a TCR editor holds some position in the issuers'
public debt and equity securities about which we report.

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, Donnabel C. Salcedo, 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 $625 for 6 months delivered via e-
mail. Additional e-mail subscriptions for members of the same
firm for the term of the initial subscription or balance thereof
are $25 each.  For subscription information, contact Christopher
Beard at 240/629-3300.

                *** End of Transmission ***