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

            Monday, December 23, 2002, Vol. 6, No. 253

                          Headlines

ACORN HOLDING: Fails to Comply with Nasdaq Listing Requirements
ADELPHIA COMMS: Equity Committee Turning to Saybrook for Advice
ADVANCE TISSUE: Hires Clifford Chance as Securities Counsel
ADVANCED TISSUE: Eureka's Taking Bids for Debtor's Product Lines
AIR TO US: Fitch Further Junks Ratings on Series C & D Notes

ALAMOSA HOLDINGS: S&P Junks Corporate Credit Rating at CCC+
ALLEGHENY ENERGY: Talking with Banks re Outstanding Defaults
AMERICAN PAD & PAPER: Files for Chapter 11 Protection in Texas
ANC RENTAL: Seeks Nod to Assign Columbus Contracts to Midwest
ASIA GLOBAL CROSSING: Asset Sale Hearing Set for Jan. 21, 2003

ATHERTON FRANCHISEE: S&P Lowers Ratings on 3 Note Classes to D
AVAYA INC: Names Louis D'Ambrosio to Lead Sales Operations
BABCOCK & WILCOX: McDermott, et al., File Consensual Plan
BCE TELEGLOBE: Fitch Withdraws D Note Ratings Due to Bankruptcy
BURLINGTON: Inks Pact Lifting Stay for Allens to Pursue Claims

CNA FINANCIAL: Sells $750 Million of New Preferreds to Loews
CLAXSON INTERACTIVE: Amends Chilean Syndicated Credit Facility
COLD METAL PRODUCTS: Will Move Corp. Headquarters to Youngstown
CONSECO FINANCE: S&P Drops Related Trust Ratings to D
CONTINENTAL AIR: Extending Review Period of Proposed Alliance

CONTOUR ENERGY: Texas Court Confirms Plan of Reorganization
COVANTA: Stipulation re Traveler's Settlement with Yuba Approved
COVISTA COMMS: Shareholders Approve Equity Sale to Henry Luken
CTC COMMUNICATIONS: Committee Hires Saul Ewing as Local Counsel
DOLE FOOD: S&P Keeps Lower-B Level Ratings on Watch Negative

DYNEGY: Unit Completes Settlement with Futures Trading Regulator
ECHOSTAR COMMS: Massachusetts Fin'l Discloses 6.8% Equity Stake
EMPIRIC ENERGY: Inks Pact to Acquire Venture Energy Projects
ENCOMPASS SERVICES: Court Grants Priority to Postpetition Goods
ENRON CORP: EMCC Wants Court Approval for Navan Settlement Pact

EOTT ENERGY: Intends to Assume Two Premium Financing Agreements
EUROTECH LTD: Closes Licensing Transaction with Acoustic Core
FIRST UNION: Fitch Affirms Lower-B Ratings on 6 Classes of Notes
FISHER SCIENTIFIC: S&P Places Low-B Ratings on Watch Positive
FOCAL COMMS: Case Summary & Largest Unsecured Creditors

FOCAL COMMS: Fitch Drops Senior Unsecured Debt Ratings to D
GLOBAL CROSSING: Court OKs Settlement Pact with Risk Management
GMAC COMM'L: Fitch Rates Four Classes of Notes at Low-B Level
GROUP TELECOM: Conducts Meetings with Creditors to Vote on Plan
HAYES LEMMERZ: Assuming Stelco Blank & Rim Supply Agreement

INTEGRATED BUSINESS: Nears Completion of Investor Debt Workout
INTEGRATED TELECOM: Secures Okay to Sign-Up PwC as Accountants
JUNIPER CBO: S&P Affirms Junk Ratings on Classes A-3A & A-3B
KAISER ALUMINUM: Inks Pact to Sell Tacoma, WA Property for $12MM
KENTUCKY ELECTRIC: Lenders Snub Two Refinancing Proposals

KMART CORP: Court Approves Compromise Agreement with IRS
KMART CORP: Shares Trade on Pink Sheets Under New Ticker Symbols
LAIDLAW INC: Reports Improved Operating Results for Fiscal 2002
LUCENT: Maryann Niebojeski Returns to Head Investor Relations
MARK NUTRITIONALS: Brings-In Bill Wagner as Financial Consultant

MAXXIM MEDICAL: S&P Places B- Corp. Credit Rating on Watch Neg.
METRIS COMPANIES: Will Publish Fourth Quarter Results on Jan. 29
METRIS: Fitch Cuts Sr. Debt & Bank Credit Facility Ratings to B-
MISSISSIPPI CHEMICAL: Will Padlock Donaldsonville, LA Facility
MORGAN STANLEY: Fitch Affirms Low-B Ratings on 6 Note Classes

MOUNTAIN OIL: September 30 Working Capital Deficit Tops $180K
NATIONSRENT INC: Wants to Re-Employ Kroll Zolfo as Consultant
NEOFORMA INC: Extends VHA Credit Facility Until Dec. 31, 2004
NETIA HOLDINGS: Sets Extraordinary General Meeting for Jan. 15
NETIA: Taking Subscription for Series H Shares Today

NORTEL NETWORKS: Board Declares Preferred Share Dividends
N. AMERICAN REFRACTORIES: Honeywell to Fund Sec. 524(g) Trust
NRG NORTHEAST: S&P Lowers Credit Rating Down to Default Level
NRG ENERGY: Unit Fails to Make Payments on Bonds Due December 15
OWENS CORNING: Del. Court Says Yes to Settlement Pact with DEQ

PACIFIC GAS: CPUC Presses for Summary Judgment Denying Plan
PAC-WEST TELECOMM: Advances Interconnection Arbitration with SBC
POLYONE CORP: Fitch Hatchets Senior Unsecured Debt Rating to BB
PROVANT: Selling Several Businesses to Drake Beam for $30 Mill.
QWEST COMMS: Debt Exchange Offer Expired Friday as Scheduled

RESEARCH INC: Minnesota Court Confirms Reorganization Plan
RESTORAGEN INC: Case Summary & 20 Largest Unsecured Creditors
RITE AID CORP: Nov. 30 Balance Sheet Upside-Down by $105 Million
SMOKY RIVER: Fitch Junks Class C Notes Rating at C from B-
SOLECTRON CORP: Fiscal 1st Quarter Net Loss Widens to $71 Mill.

STERLING CHEMICALS: Successfully Emerges from Bankruptcy
UNIFAB INTL: Annual Shareholders' Meeting to Convene on Dec. 27
UNITED AIRLINES: Will Honor Prepetition Customer Obligations
UNITED AIRLINES: Unsec. Committee Taps Sonnenschein as Counsel
US AIRWAYS: Files Chapter 11 Plan and Disclosure Statement

US AIRWAYS: AAU Wants Stay Relief to Recover Trust Funds
US AIRWAYS: Reaches New Agreement with Training Instructors
VIASYSTEMS: Court Extends Lease Decision Period Until Feb. 28
WEIGHT WATCHERS: S&P's Keeps Watch on BB- Credit & Debt Ratings
WHEELING-PITTSBURGH: Files Chapter 11 Reorganization Plan

WILLIAM CARTER: S&P Raises Credit Rating Up Two Notches to BB-
WORLDCOM INC: Retains Joint Venture as Real Estate Consultant

* Cadwalader Names Tom Fini & Richard Gregorian as New Partners
* O'Melveny & Myers LLP Opens New Office in Beijing, China

* BOND PRICING: For the week of December 23 - 27, 2002

                          *********

ACORN HOLDING: Fails to Comply with Nasdaq Listing Requirements
---------------------------------------------------------------
On December 18, 2002, Acorn Holding Corp., received a letter
from Nasdaq of a staff determination indicating that the Company
failed to comply with the minimum market value of publicly held
shares of $1,000,000 over the previous 30 consecutive trading
days and that the Company's Common Stock is therefore subject to
delisting for the Nasdaq Small Cap Market. The Company is
considering appealing the staff determination to the panel
pursuant to the procedures set forth in the Nasdaq Market Rule
4800. If such an appeal is processed, there can be no assurance
that the panel will grant the Company's request for continued
listing.

From time to time in both written reports and oral statements by
the Company's senior management, we may express our expectations
regarding future performance by the Company. These "forward-
looking statements" are inherently uncertain, and investors must
recognize that events could turn out to be other than what
senior management expected.

The Company's stock is traded on the Nasdaq Small-Cap Market
under the symbol AVCC.

As reported in Troubled Company Reporter's November 25, 2002
edition, the Company's Board of Directors had authorized
management to seek and review strategic alternatives, given the
size of the Company and the costs of remaining a public company.

                         *     *     *

                   Going Concern Uncertainty

Acorn Products' September 29, 2002, balance sheet shows that its
total current liabilities exceeded total current assets by about
$16 million.

In its Form 10-Q filed with the Securities and Exchange
Commission on November 13, 2002, the Company reported:

"The Company's consolidated financial statements have been
presented on a going concern basis, which contemplates the
realization of assets and the satisfaction of liabilities in the
normal course of business. The Company is substantially
dependent upon borrowing under its credit facility.

"On June 28, 2002, the Company entered into a recapitalization
transaction, obtaining a new $10.0 million investment from its
majority stockholders representing funds and accounts managed by
TCW Special Credits and Oaktree Capital Management, LLC. The
Company also entered into a new $45.0 million credit facility,
agented by CapitalSource Finance, LLC, consisting of a $12.5
million term loan and a $32.5 million revolving credit
component. The term loan bears interest at prime plus 5.0% and
the revolving credit component bears interest at prime plus
3.0%. The Lender's facility terminates initially in December
2004 which is automatically extended to June 2007 upon
completion of an offering of common shares to minority
stockholders and conversion of certain convertible notes and
preferred stock described below. The majority of the proceeds
from this transaction went to pay off borrowings under the
Company's previous credit facility ($33.7 million was borrowed
as of June 27, 2002), that otherwise expired on June 30, 2002.
Relative to the extension and termination of its previous credit
facility, the Company paid $2.0 million of success fees during
the second quarter of fiscal 2002. At September 29, 2002, the
Company had $8.4 million available to borrow under its new
credit facility."


ADELPHIA COMMS: Equity Committee Turning to Saybrook for Advice
---------------------------------------------------------------
The Official Committee of Equity Security Holders of Adelphia
Communications and its debtor-affiliates seek the Court's
authority to retain Saybrook Restructuring Advisors, LLC as its
financial advisors nunc pro tunc to August 22, 2002.

Committee Co-Chairman Van Greenfield explains that they selected
Saybrook based on its experience in providing investment banking
and financial advisory services in Chapter 11 cases and based on
its familiarity with the ACOM Debtors' businesses.  Saybrook is
a respected investment banking and financial advisory services
firm and has extensive experience working with financially
troubled entities in complex financial reorganizations -- both
in Chapter 11 cases and in out-of-court restructuring
situations.  In particular, Saybrook has served, or is serving,
as financial advisor and investment banker to numerous official
committees and debtors-in-possession in bankruptcy proceedings,
including the Official Creditors' Committees for Orange County's
Investment Pool, Pacific Gas & Electric, and the Official Equity
Committee for Kmart Corporation.  Additionally, principals of
Saybrook have served as financial advisors to debtors-in-
possession and creditors in numerous bankruptcy proceedings,
including Ritter Development, LLC; Express.com; WhatsHotNow,
Inc.; Mobile Energy Services Company, LLC; Osceola Power LP;
Okeelanta Power, LP; Robbins Resource Recovery Partners, LLC;
Koll Real Estate, Mortgage and Realty Trust; First City
Bancorporation SAC Holdings Inc.; rPS Textiles, Inc.; Baldwin
Builders, Inc.; and United Education and Software Corporation.

Furthermore, Mr. Greenfield adds that before the appointment of
the Equity Committee, Saybrook advised an ad hoc committee of
the Debtors' preferred equity security holders on matters
relating to these bankruptcy proceedings.  In advising the ad
hoc committee, Saybrook developed a familiarity with the
Debtors' business operations and affairs.  Given Saybrook's
background, expertise, historical performance, and familiarity
with the Debtors' businesses, the Equity Committee believes that
Saybrook is uniquely qualified and well suited to provide
financial advisory services to the Equity Committee.

The Equity Committee expects Saybrook to provide financial
advisory and investment banking services, including:

   A. General Financial Advisory Services:

      -- review and analyze the business, management,
         operations, properties, financial condition and
         prospects of the Debtors;

      -- review the assumptions underlying the business plans
         and cash flow projections for the assets involved in
         any potential transaction;

      -- determine the reasonableness of the Debtors' projected
         performance;

      -- monitor, evaluate and report to the Equity Committee
         with respect to the Debtors' near term liquidity needs,
         material operational changes and related financial and
         operational issues;

      -- review and analyze all material contracts and
         agreements;

      -- identify contracts and agreements that may be
         disadvantageous to the interests of the Debtors' equity
         security holders;

      -- assist in procuring and assembling any necessary
         validations of asset values; and

      -- provide ongoing assistance to the Equity Committee and
         the Equity Committee's legal counsel.

   B. Investment Banking/Restructuring Services:

      -- evaluate the Debtors' capital structure and make
         recommendations to the Equity Committee with respect to
         the Debtors' efforts to reorganize their business
         operations and confirm a Plan;

      -- advise and assist the Equity Committee in analyzing
         alternative reorganization strategies;

      -- review and analyze any and all plans of reorganization
         and disclosure statements submitted to the Court for
         approval;

      -- evaluate the proposed Plan structure for the Debtors to
         ascertain its impact on the recovery available to all
         shareholders;

      -- in connection with the Plan, advise and assist the
         Equity Committee in connection with the structuring by
         the Debtors of any new securities to be issued to
         creditors and Shareholders in full or partial
         satisfaction of the creditors' or Shareholders' claims
         or interests;

      -- provide ongoing analysis of the Debtors' financial
         condition, business plans, capital spending budgets,
         operating forecasts, management and the prospects for
         their future performance;

      -- review and provide analysis of any valuations of the
         Debtors, as a whole and by system or other business
         unit, on a going concern basis and on a liquidation
         basis;

      -- review and provide analysis of any proposed disposition
         of any material assets of the Debtors or any offers to
         purchase some or substantially all of the Debtors'
         assets;

      -- assist, if necessary, in the formation of a financing
         team, including third party professionals;

      -- assist and participate in negotiations on behalf of the
         Equity Committee and other constituents with the
         Debtors or any groups affected by a Plan;

      -- assist the Equity Committee in preparing documentation
         required in connection with supporting or opposing a
         Plan; and

      -- at the Equity Committee's request and in conjunction
         with the Debtors' advisors, identify and pursue:

         a. potential buyers for the Debtors and its systems,
            and

         b. potential new money investors.

Saybrook Partner Jonathon Y. Thomas assures the Court that the
Firm has no connection with, and holds no interest adverse to,
the Debtors, their estates, their creditors, or any party-in-
interest in these cases.  In addition, to the best of his
knowledge, Saybrook is a "disinterested person" within the
meaning of Section 101(14) of the Bankruptcy Code.  However, Mr.
Thomas discloses that:

   A. Saybrook performed services for an ad hoc committee of
      equity security holders prior to the appointment of the
      Equity Committee.  Three members of the ad hoc committee
      now serve on the Equity Committee, including AIG, Blue
      River, and Highbridge;

   B. Saybrook has in the past performed services unrelated to
      these Chapter 11 cases for certain of the Debtors' bank
      lenders and indenture trustees, including: Bank of New
      York, Bank of Tokyo Mitsubishi Trust Company, Bankers
      Trust Company, Banque Nationale de Paris, Deutsche Bank
      AG, Bank of America, N.A., FujiBank, Limited, Industrial
      Bank of Japan, Limited, Long-Term Credit Bank of Japan,
      Ltd., Mitsubishi Trust & Banking Corporation, Sumitomo
      Trust and Banking Co., Ltd., and Union Bank of California;

   C. Saybrook is presently performing services unrelated to
      these Chapter 11 cases for Playa Capital, which is in part
      owned by Morgan Real Estate Fund, an affiliate of Morgan
      Stanley, which is an indenture trustee or bank lender of
      the Debtors;

   D. Saybrook is presently financial advisor to the Official
      Committee of Unsecured Creditors in connection with the
      Chapter 11 case of Pacific Gas and Electric Company.  The
      members of that committee include these creditors of the
      Debtors: Bank of America, N.A., JP Morgan Chase & Co.,
      Pacific Investment Management Company and Merrill Lynch;

   E. Saybrook, in the past, has served as co-manager of the
      sale of underwritten tax exempt securities unrelated to
      these Chapter 11 cases with Salomon Smith Barney, Inc., an
      underwriter of the Debtors' securities; and

   F. Sun America, an equity holder of the Debtors, is a
      minority investor in funds unrelated to these Chapter 11
      cases that are managed by Saybrook;

In exchange of these professional services, Saybrook will charge
these fees:

   A. Initial Fee: A $150,000 initial financial advisory cash
      fee will be due and paid by the Debtors' estates after the
      Court's approval of this Application;

   B. Monthly Fee: A $150,000 monthly cash fee payable on the
      22nd day of each month during the term of Saybrook's
      engagement starting on August 22, 2002, with Saybrook to
      be paid with respect to all Monthly Advisory Fees incurred
      from August 22, 2002 after approval of this application;
      and

   C. Transaction Fee: A transaction fee equal to the maximum
      of:

      -- $3,000,000 after the effective date of a Plan by which
         the Company emerges from Chapter 11; or

      -- the sum of:

         a. $4,000,000, if each class, pursuant to the Plan, of
            preferred shareholders either approves or is
            unimpaired under a confirmed Plan, plus

         b. $5,000,000, if either the class of class A common
            shareholders by affirmative class vote approves, or
            the class of class A common shareholders are not
            impaired by the Plan and at least four of the five
            largest holders of class A common shareholders do
            not oppose confirmation of the Plan;

         provided, however, that the Transaction Fee will be
         reduced by 50% of the amount by which the aggregate
         Monthly Fees earned and paid prior to August 30, 2003,
         exceed $1,000,000; and provided, further, that to the
         extent the Transaction Fee paid exceeds 3% of actual
         value, as of the effective date of the Plan, of
         recoveries pursuant to the Plan by equity holders, then
         the Transaction Fee will be limited to 3% of the value
         distributed to equity holders; and provided, however,
         that the Transaction Fee will never exceed 3% of the
         distribution to equity security holders, and in the
         event that there is no distribution to these holders
         under a plan, then the Transaction Fee will be zero.

Pursuant to the terms of the Engagement Letter, Mr. Thomas
relates that the Equity Committee and Saybrook agree that none
of the Firm or any of its affiliates or their directors,
officers, agents, employees, or controlling persons or any of
their successors or assigns will have any liability to the
Equity Committee for or in connection with this engagement or
any transactions or conduct except for losses, claims, damages,
liabilities or expenses incurred by the Equity Committee that
are determined pursuant to a final non-appealable judgment of a
court of competent jurisdiction to have resulted primarily from
the gross negligence or willful misconduct of the Covered
Person. Furthermore, the Debtors will indemnify Saybrook and
certain related persons in accordance with the indemnification
provisions set forth in the Engagement Letter.  The Equity
Committee and Saybrook believe that these provisions are
customary and reasonable for the engagement, both in out-of-
court and in Chapter 11 reorganizations, and are consistent with
indemnification provisions approved in large cases in this
District.

Mr. Thomas explains that Saybrook's engagement under the terms
of the Engagement Letter will terminate on the effective date of
the Plan, or may be terminated by the Equity Committee at any
time; provided however, that:

   A. termination of Saybrook's engagement will not affect the
      Debtors' continuing obligations to Saybrook and certain
      related persons as provided in the Engagement Letter.
      Notwithstanding any termination, Saybrook will be entitled
      to the full fees paid or payable in the amounts and at the
      times provided for in the Engagement Letter for services
      rendered prior to the date of termination and, for any
      Plan which is confirmed within 6 months subsequent to
      termination; and

   B. any termination of Saybrook's engagement will not affect
      the Debtors' obligation to reimburse expenses accruing
      prior to termination to the extent provided in the
      Engagement Letter. (Adelphia Bankruptcy News, Issue No.
      25; Bankruptcy Creditors' Service, Inc., 609/392-0900)

Adelphia Communications' 10.500% bonds due 2004 (ADEL04USR1) are
trading at 41 cents-on-the-dollar, DebtTraders says. See
http://www.debttraders.com/price.cfm?dt_sec_ticker=ADEL04USR1
for real-time bond pricing.


ADVANCE TISSUE: Hires Clifford Chance as Securities Counsel
-----------------------------------------------------------
The U.S. Bankruptcy Court for the Southern District of
California gave its stamp of approval to Advance Tissue
Sciences, Inc. and its debtor-affiliates' application to employ
Clifford Chance LLP as Special Securities Counsel.

Clifford Chance is an international law firm with extensive
expertise and experience in federal and state securities law
compliance, licensing and commercial transactions, and general
corporate representation.

Prior to the Petition Date, Clifford Chance provided legal
advice and services to ATS with regard to their registration
obligations under the Securities Act.  More recently, Clifford
Chance advised ATS on issues regarding their public disclosure
obligations under federal securities laws relating to the
possible restructuring of ATS and the commencement of these
chapter 11 proceedings.

The Debtors employs Clifford Chance in connection with general
corporate, commercial, and securities-related matters and,
specifically, to:

     a) provide general corporate legal advise to the Debtors;

     b) provide federal securities law advice to the Debtors;

     c) provide state securities law advice to the Debtors;

     d) provide advice with regard to listing and quotation
        requirement for national securities exchanges, national
        securities associations, over the counter trading and
        other automated reporting systems; and

     e) provide advice regarding the Debtor's existing and
        future commercial relationships; and

     f) perform all other necessary or appropriate legal
        services in connection with the professional services
        listed in connection with any other matter as requested
        by the Debtors other than representation as general
        insolvency counsel in these chapter 11 proceedings.

The Court additionally gave authority to the Debtors to pay
$56,000 of prepetition fees owed to Clifford Chance.  The
Clifford Chance attorneys currently expected to represent the
Debtors and their professional hourly rates are:

          Faye H. Russel            $595 per hour
          Maria P. Sendra           $495 per hour
          Elizabeth Lefever         $400 per hour
          Lucinda Y. Quan           $360 per hour
          Kandace W. Richardson     $360 per hour
          Mattew W. Onaitis         $330 per hour
          Charles E. Weir           $275 per hour

Advanced Tissue Sciences, Inc., is engaged in the development
and manufacture of human-based tissue products for tissue repair
and transplantation. The Company filed for chapter 11 protection
on October 10, 2002 at the U.S. Bankruptcy Court for the
Southern District of California (San Diego).  Craig H. Millet,
Esq., and Eric J. Fromme, Esq., at Gibson, Dunn & Crutcher LLP
represent the Debtor in its restructuring efforts.  When the
Company filed for protection from its creditors, it listed
$32,200,000 in total assets and $16,900,000 in total debts.


ADVANCED TISSUE: Eureka's Taking Bids for Debtor's Product Lines
----------------------------------------------------------------
Advanced Tissue Sciences, Inc., (OTC BB: ATISQ) provided an
update on certain changes and its activities under its Chapter
11 reorganization.

                     Office Relocation

As of Monday, December 23, 2002 the company's business address
will change to 10520 Wateridge Circle Drive, San Diego, CA
92121. Smith & Nephew is taking over the facility in La Jolla
previously occupied by Advanced Tissue Sciences. The company's
remaining employees are moving to a facility that the company
leased prior to its bankruptcy filing in October. The company
will have seven remaining employees as of December 31, 2002.
There will be no increase in lease expense as a result of the
move.

The new general telephone number is now (858) 452-6095. The new
telephone number for investor relations and news media
inquiries, effective Friday, December 20, will be 619-795-2345.

                       Web Site Shut-Down

The company also announced that its Web site was shut down
permanently at 5:00 p.m. Pacific time Thursday. The site is no
longer an accurate portrayal of Advanced Tissue Sciences and the
status of the company does not warrant the cost of updating the
site and its contents.

                   Eureka is Soliciting Bids

The company continues to target early 2003 for the submission of
its formal plan of reorganization. However, consistent with the
decision to liquidate assets, the company has begun actively
marketing its remaining assets. Eureka Capital Markets, LLC, the
company's financial and liquidation advisors, are actively
involved in the marketing of those assets.

Eureka has prepared several detailed "product profiles" for
company product lines. Those profiles have been circulated to
parties with potential interest and are serving as the basis for
ongoing negotiations. The company will announce material
transactions when deals are actually complete. Any material
transactions must be approved by the Bankruptcy Court before
they can be consummated. The company does not intend to make
announcements or other comments about offers and negotiations
while they are ongoing.

Those interested in purchasing assets should contact George
Kidd, Managing Director, Eureka Capital Markets, at (414) 332-
8075.

                     Real Estate for Sale

The company also has retained a real estate broker who is
assisting in locating a potential assignee or sublessee for the
lease on the facility on Wateridge Circle Drive. The present
lease is supported by a letter of credit that the company was
forced to secure by posting approximately $1.7 million in cash.
Any assumption and assignment of the lease, as well as any
rejection of the lease, must be approved by the Bankruptcy
Court.


AIR TO US: Fitch Further Junks Ratings on Series C & D Notes
------------------------------------------------------------
Fitch Ratings has downgraded and removed from Rating Watch
Negative the following Air 2 US enhanced equipment notes (EENs):

      -- Series A EENs to 'BBB-' from 'A';

      -- Series B EENs to 'B-' from 'BBB';

      -- Series C EENs to 'CC' from 'CCC';

      -- Series D EENs to 'C' from 'CC';

      -- All series are removed from Rating Watch Negative.

The rating actions reflect the Chapter 11 bankruptcy filing of
United Airlines, Inc., and the likelihood that the underlying
aircraft collateral has experienced some further impairment of
its value.

Air 2 US is a special purpose Cayman Islands company created to
issue the EENs, hold the proceeds as Permitted Investments, use
the Permitted Investments and their income to repay the EENs,
and enter into a risk transfer agreement. AIR 2 US has entered
into a risk transfer agreement, the PRA, with a subsidiary of
Airbus. The primary provision of the PRA states that if American
Airlines, Inc., or United Air Lines, Inc., fail to pay scheduled
rentals under existing subleases of aircraft with subsidiaries
of Airbus, AIR 2 US will pay these rental deficiencies to a
subsidiary of Airbus. These deficiency payments will come from
the Permitted Investments.

As a result of its bankruptcy, United has stopped sublease
payments. Although it is possible that payments may resume by
the next EEN debt service payment date, April 2003, Fitch
expects that EEN Permitted Investment cash flows will be used to
pay Airbus rather than the EEN holders. Accordingly, some
liquidity reserves will be drawn on to pay timely EEN interest.
Liquidity reserves are available to support all EEN series
except series D.

The ratings of the series A, and series B EENs are primarily
based on the expected present value of sublease rental payments
from the sublessees; 2) the Permitted Investment scheduled
payments; 3) the probability that the Permitted Investment
payments will be first directed to pay the scheduled sublease
rentals as per the Payment Recovery Agreement (PRA); 4)
liquidity facilities to support EEN interest payments; 5) the
ability of Airbus S.A.S. (Airbus) to provide support to the
transaction through the Airbus agreement and related agreements;
6) and the integrity of the EEN's legal structure.

The rating of the series C EENs is supported by the factors
mentioned above, but is based primarily on the credit quality of
the lower rated of the two sublessees. The rating of the series
D EENs is solely based on the lower unsecured credit of the two
sublessees.


ALAMOSA HOLDINGS: S&P Junks Corporate Credit Rating at CCC+
-----------------------------------------------------------
Standard & Poor's Ratings Services lowered its corporate credit
rating on Alamosa Holdings Inc., to 'CCC+' from 'B-'. The
downgrade reflects Standard & Poor's concern that Alamosa faces
increased risk of deteriorating liquidity in 2003.

The rating remains on CreditWatch with negative implications,
where it had been placed on June 26, 2002 due to concerns over
liquidity. The Lubbock, Texas-based company is a Sprint PCS
affiliate that provides wireless services to about 591,000
subscribers. At the end of the third quarter of 2002, Alamosa
had total debt of about $860 million.

"With free cash flow prospects likely to be weak in 2003 after
factoring in about $45 million in projected capital
expenditures, significant cash interest expense, and uncertain
level of EBITDA due to such factors as competition, over 30% of
its subscribers being subprime in credit quality, and the weak
economy, Alamosa's limited liquidity may not adequately fund
operations and leave sufficient cushion against execution risks
in 2003," said Standard & Poor's credit analyst Michael Tsao.

Standard & Poor's also said that Alamosa needs to avoid
significant execution missteps ahead in order to meet senior
leverage and total leverage covenants as they become effective
in the second quarter of 2003.

The resolution of the CreditWatch depends on Alamosa showing
significantly improving trends in cash flow and operating
metrics in the near term. Without these improvements, it is
likely that the ratings will be downgraded further.

DebtTraders reports Alamosa PCS Holdings Inc.'s 12.875% bonds
due 2010 (APS10USR1) are trading between 18 and 20. See
http://www.debttraders.com/price.cfm?dt_sec_ticker=APS10USR1for
real-time bond pricing.


ALLEGHENY ENERGY: Talking with Banks re Outstanding Defaults
------------------------------------------------------------
Allegheny Energy, Inc., (NYSE: AYE) released unaudited
consolidated financial data for the nine months ended
September 30, 2002.

This information was prepared for delivery to its lenders in the
course of the Company's ongoing comprehensive financial review
disclosed on November 4, 2002, when the Company announced it was
delaying the release of third quarter results.

The Company reported a consolidated net loss of $334.4 million
for the nine-month period, which includes a reduction in the
market value of its energy trading portfolio to reflect changes
in valuation model assumptions and market conditions; the
cumulative effect of an accounting change related to the
adoption of the Statement of Financial Accounting Standards
(SFAS) No. 142, "Goodwill and Other Intangible Assets";
workforce reduction expenses; and other items.

In the course of the comprehensive review of its financial
records, Allegheny Energy has identified a number of required
adjustments with respect to its 2002 financial statements that
resulted from accounting errors. These adjustments are fully
reflected in the unaudited financial data released Thursday.
Based on the results of this comprehensive review, the Company
has determined that it and certain of its subsidiaries will have
to restate their first and second quarter financial statements
for 2002. The Company will release third quarter 2002 earnings
data when the comprehensive review has been completed and will
issue restated financial statements for the first and second
quarters of 2002 as soon as possible thereafter.

The Company completed an analysis of the potential impairment of
goodwill related to the acquisition of its energy trading
business in accordance with SFAS No. 142, as well as the
potential impairment of its investment in its Midwest generating
assets in accordance with SFAS No. 144, "Accounting for the
Impairment or Disposal of Long-Lived Assets." The Company
concluded that these assets are not impaired.

Allegheny Energy is continuing discussions with banks, other
lenders, and trading counterparties regarding outstanding
defaults, needed amendments to existing agreements, and
obtaining additional secured financing. As announced on
October 21, 2002, the Company has received authority from the
U.S. Securities and Exchange Commission to borrow up to $2
billion on a secured basis, related to the refinancing.
Additional approvals needed to implement this refinancing are
still pending. In addition, the Company's subsidiaries,
Allegheny Energy Supply Company, LLC, and Allegheny Generating
Company, have received extensions through December 31, 2002, on
waivers from bank lenders under their credit agreements. The
Company continues to negotiate with these and other lenders and
is also working with the St. Joseph County generating facility
lenders concerning financial obligations related to this
facility. If the Company is unable to successfully complete
negotiations with these lenders, including arrangements with
respect to inter-creditor issues, it would likely be obliged to
seek bankruptcy protection.

As previously announced, Allegheny Energy has already taken
steps to reduce its cost structure, preserve cash, and
strengthen its balance sheet, including reducing the Company's
reliance on its wholesale energy trading business; significantly
reducing pre-tax operating expenses in 2002; canceling the
development of several generating facilities, saving $700
million in capital expenditures over the next several years;
reducing the workforce by approximately 10 percent through a
voluntary early retirement option, normal attrition, and
selected staff reductions; and suspending the dividend on its
common stock.

The Company actively continues its work to resolve the following
issues which are critical to its financial stability and long-
term performance:

     - satisfactory completion of asset sales and/or the
       issuance of equity;

     - satisfactory outcome of Federal Energy Regulatory
       Commission proceedings in which the validity of the
       Company's contracts with the California Department of
       Water Resources is challenged;

     - satisfactory resolution of litigation with Merrill Lynch
       regarding the Allegheny Energy Global Markets acquisition
       (in which Merrill Lynch is claiming $115 million plus
       interest and the Company has filed counter claims against
       Merrill Lynch);

     - satisfactory resolution of trading counterparties'
       current and future demands in settlement of terminated
       trades and collateral in respect of ongoing positions;
       and

     - continued transition of the Company to refocus on its
       core businesses.

Information regarding results for Allegheny Energy Supply for
the first nine months of 2002 is included in the Company's Form
8-K filed today with the SEC.

With headquarters in Hagerstown, Md., Allegheny Energy is an
integrated energy company with a balanced portfolio of
businesses, including Allegheny Energy Supply, which owns and
operates electric generating facilities and supplies energy and
energy-related commodities in selected domestic retail and
wholesale markets; Allegheny Power, which delivers low-cost,
reliable electric and natural gas service to about three million
people in Maryland, Ohio, Pennsylvania, Virginia, and West
Virginia; and a business offering fiber-optic and data services,
energy procurement and management, and energy services. More
information about the Company is available at
http://www.alleghenyenergy.com

Allegheny Energy Inc.'s 7.750% bonds due 2005 (AYE05USR1),
DebtTraders reports, are trading at 72 cents-on-the-dollar. See
http://www.debttraders.com/price.cfm?dt_sec_ticker=AYE05USR1for
real-time bond pricing.


AMERICAN PAD & PAPER: Files for Chapter 11 Protection in Texas
--------------------------------------------------------------
American Pad & Paper LLC voluntarily filed for Chapter 11
bankruptcy protection in the Bankruptcy Court, Eastern District
of Texas, Sherman Division.

In June 2002, the Company's owners resigned from all management
positions they held at Ampad. At that time their shares were
placed into a voting trust and a trustee was appointed who,
along with management, assumed complete responsibility for the
corporate governance and day-to-day operations of the Company.
Since that time the trustee, management team and their advisors
have been investigating alternative financing arrangements or a
strategic transaction to continue the significant financial
progress that has been made. Though a number of options were
explored, the Company was unable to complete a reorganization
outside of bankruptcy under terms agreeable to its owners.
Utilizing the Chapter 11 process, the Company plans to
reorganize with new equity sponsorship, including management
participation, which will create a new ownership structure.

Ampad has received a commitment for $40 million in Debtor-in-
Possession financing from its existing bank group, led by Bank
of America, to facilitate the reorganization. This financing
will provide the necessary liquidity the Company will require
until it emerges from Chapter 11 and ensure that its customers
continue to receive the products and level of service they have
come to expect from Ampad.

"Our suppliers have continued to provide a high level of support
and will remain key business partners as we move through this
process," stated Mark Lipscomb, Ampad's President and CEO.
"During the past year, the Ampad team has accelerated its
progress in our turnaround initiatives, as evidenced by higher
customer service levels, revenue growth and improved margins. As
we look to the future, our goal is to maintain our position as a
leading supplier in the office products industry."

Ampad said that the Chapter 11 filing should have little impact
on customers and employees. The Company will seek and expects to
receive the Court's approval to continue payment of employee
salaries, wages and benefits without interruption. It is the
Company's intention to quickly present a reorganization plan to
the bankruptcy court that will allow it to finalize the new
equity sponsorship and emerge from Chapter 11 in a timely
manner.

Ampad is a leading manufacturer and distributor of writing pads,
filing supplies, retail envelopes and specialty papers and
serves many of the largest and fastest growing office products
retailers and distributors in North America. Additional
information is available on the Company's Web site at
http://www.ampad.com


ANC RENTAL: Seeks Nod to Assign Columbus Contracts to Midwest
-------------------------------------------------------------
Elio Battista, Jr., Esq., at Blank Rome Comisky & McCauley LLP,
in Wilmington, Delaware, informs the Delaware Bankruptcy Court
that ANC Rental Corporation and its debtor-affiliates have now
reached an understanding with the Columbus Municipal Airport
Authority, which operates and controls the Columbus Airport,
regarding the assumption and assignment of the Alamo Concession
Agreement and the Financing Lease Agreement to Midwest Car
Corporation.

The Debtors seek the Court's authority to:

   A. assume and assign to Midwest the Concession Agreement,
      dated as of June 1, 2001 by and between the Columbus
      Authority and Alamo, whereby Columbus granted to Alamo the
      non-exclusive right to operate a  car rental concession at
      the Columbus Airport;

   B. assume and assign to Midwest the Financing Lease
      Agreement, dated as of June 1, 2001, as amended, by and
      between the Columbus Authority and Alamo, relating to
      $3,265,600 in Subordinate Taxable Airport Improvement
      Revenue Bonds, Series 2001A, whereby Columbus agreed to
      issue certain bonds in return for payments from the rental
      car concessionaires at the Columbus Airport; and

   C. reject the Rent-A-Car Service Facility Land Lease, dated
      June 7, 1991, by and between Alamo and the City of
      Columbus, Ohio, whereby Columbus leased to
      Alamo certain premises located near the Columbus Airport.

By assuming and assigning the Alamo Concession Agreement and the
Financing Lease Agreement, Mr. Battista points out that the
Debtors will be able to close the Midwest Agreement with regard
to the Columbus Airport.  After closing, the Debtors will
receive from Midwest additional fees for the license of rentals
made at the Columbus Airport under both the Alamo and National
brands and will also be relieved of the ongoing costs associated
with operating the Alamo brand.  As a result, by assuming and
assigning the Alamo Concession Agreement and the Financing Lease
Agreement, the Debtors will receive increased revenues and their
operations at the Columbus Airport will be consolidated under
related ownership.

The Debtors believe that this arrangement will contribute
significant cash flow to the Debtors, as well as providing
customers with the now-familiar dual branded operations at the
Columbus Airport.  In addition, by rejecting the Alamo Lease,
the Debtors will be relieved of the continuing obligation to:

   -- participate in a lease that is no longer advantageous or
      beneficial to their estates; and

   -- pay ongoing fees, among other things, on a lease that is
      no longer beneficial to their estates. (ANC Rental
      Bankruptcy News, Issue No. 24; Bankruptcy Creditors'
      Service, Inc., 609/392-0900)


ASIA GLOBAL CROSSING: Asset Sale Hearing Set for Jan. 21, 2003
--------------------------------------------------------------
Asia Global Crossing, the Committee and Asia Netcom reported to
the Court certain consensual modifications to the Sale Agreement
that resolved the Objections to the Agreement.

The Sale Agreement is modified:

   (1) by revising the definition of "Distribution Amount" under
       the Sale Agreement to read as:

       "Distribution Amount" will mean:

       (a) if Final Cash is greater than or equal to
           $89,800,000, an amount equal to $89,800,000, and

       (b) if Final Cash is less than $89,800,000, an amount
           equal to Final Cash;

       provided that "Distribution Amount" will be an amount of
       no less than $68,500,000 so long as the Closing Date will
       be on or prior to March 31, 2003; and provided further
       that, in the event that the Closing Date mutually will be
       extended by Seller and Purchaser beyond March 31, 2003,
       the "Distribution Amount" will be an amount of no less
       than $68,500,000 through the date of such extension; and

   (b) by changing the amount of the Break-up Fee set forth in
       Section 10.02(a)(ii)(x) of the Sale Agreement from "$16
       million" to "12 million".

The Sale Hearing will be held on January 21, 2003 at 2:00 p.m.
(prevailing Eastern Time), in Room 723 of the United States
Bankruptcy Court, Alexander Hamilton Customs House, One Bowling
Green, New York, New York 10004.  Objections or responses, if
any, to the Sale Motion should be received by no later than 4:00
p.m. (prevailing Eastern Time) on January 9, 2003.

                        *   *   *

As previously reported, the AGX Debtors and Asia Netcom entered
into a Sale Agreement.  Pursuant to the Sale Agreement, the AGX
Debtors propose to transfer, assign and sell to Asia Netcom
substantially all of its assets free and clear of Encumbrances
and assume and assign to Asia Netcom of certain executory
contracts and unexpired leases.  The Asia Netcom Transaction is
subject to approval by this Court and higher or better offers to
be solicited pursuant to certain notice and bidding procedures.
The Asia Netcom Transaction will provide the economic
underpinnings of the Debtors' plan of reorganization to be filed
in the Chapter 11 Case.

The AGX Debtors requested entry of an order approving the terms
and conditions of the Sale Agreement, or any other definitive
agreement between the Debtor and the Successful Bidder that may
emerge from an auction process.

The Debtors also asked the Court to authorize the consummation
of the Sale of the Acquired Assets, free and clear of all
Encumbrances, in accordance with the provisions of the Sale
Agreement.  Finally, the Debtors asked the Court to determine
that the Asia Netcom Transaction is exempt from any stamp,
transfer, recording or similar tax as a sale in anticipation of
a Chapter 11 plan of reorganization. (Global Crossing Bankruptcy
News, Issue No. 31; Bankruptcy Creditors' Service, Inc.,
609/392-0900)


ATHERTON FRANCHISEE: S&P Lowers Ratings on 3 Note Classes to D
--------------------------------------------------------------
Standard & Poor's Ratings Services lowered its ratings on the
class B, C, and D notes issued by Atherton Franchisee Loan
Funding 1999-A LLC to 'D'.

The rating actions follow the continued deterioration in the
performance of the underlying pool of franchise loan obligors
and the subsequent reduction in cash flow available to pay the
monthly expenses of the trust. Specifically, the defaults of the
class B, C, and D notes reflect the consecutive interest
shortfalls experienced by each of these classes on the
November 15 and December 16, 2002 distribution dates.

On the November 15 distribution date, the class B, C, and D
noteholders experienced interest shortfalls in the amount of
$13,421, $44,589, and $50,302, respectively. The cash flow
available to pay the trust's monthly expenses has been
negatively impacted by the performance of the underlying pool of
franchise loans (the majority of the loans (81%) were made to
obligors in the quick-service and casual dining segment of the
restaurant industry, and the remainder to obligors in the
specialty retail and petroleum sectors). It appears that two
factors added further stress to liquidity on the November 15
distribution date. First, the servicer, GMAC Commercial Mortgage
Corp., exercised its right to cease making future principal and
interest advances, deeming them nonrecoverable, with respect to
a particular gas and convenience store operator whose properties
have been in foreclosure since August 2001 (cumulative
outstanding principal and interest advances with respect to this
obligor exceed $2.2 million). This resulted in a reduction of
approximately $48,000 in available interest to pay the expenses
of the trust. Second, while AMRESCO Commercial Finance Inc., the
servicing advisor, has typically chosen to recover property
protection advances on a monthly basis, the recovery of $132,604
on the November 15 distribution date was nearly double the
amount recovered one month prior. This too was attributable to
the workout resolution of the same gas and convenience store
obligor in foreclosure. The net effect of these two
circumstances was a decline in overall liquidity of
approximately $113,000 on the November 15 distribution date.

Subsequently, on the December 16 distribution date, the class B,
C, and D noteholders experienced interest shortfalls in the
amount of $48,081, $44,874, and $50,646, respectively, bringing
the cumulative outstanding monthly interest shortfalls to
$61,502, $89,463, and $100,947, for each class, respectively.
The failure to pay timely interest on the December distribution
date is a direct result of GMAC's decision to begin recovery
of the outstanding principal and interest advances made on
behalf of the gas and convenience store operator whose
properties are in foreclosure and are in the final stages of the
workout process. GMAC has communicated its intentions to recover
approximately $1 million of the outstanding principal and
interest advances through the trust's waterfall over the course
of the next five months. It appears that the recovery of these
advances will cause a lengthy stress on liquidity that will
result in additional interest shortfalls - recovery of which is
questionable. Additionally, the recovery of advances by the
servicer negatively impacted the trust further, as the class A-1
noteholders experienced a principal shortfall on the December 16
distribution date of $56,350. Based on conversations with GMAC,
it is expected that this trend is likely to continue in the near
term, as it relates to the full recovery of principal and
interest advances with respect to this particular gas and
convenience store operator.

The ratings on classes E and F were lowered to 'D' on April 23,
2002, based upon a failure to cure significant cumulative
monthly interest shortfalls. As of the most recent reporting
period, those cumulative outstanding interest shortfalls amount
to $120,629 and $359,645, respectively. Additionally, on Nov. 6,
2002, Standard & Poor's lowered its ratings on Atherton's series
1999-A class B, C, and D notes to 'BBB', 'B-', and 'CCC',
respectively (the ratings remained on CreditWatch Negative at
that time, where they were placed on April 23, 2002). Those
rating actions reflected the continued deterioration in pool
performance and the anticipated reductions in available credit
enhancement. The ratings on Atherton's series 1999-A class A-1,
A-2, and A-X notes, which were also previously lowered on Nov.
6, 2002, remain 'AA-' and on CreditWatch Negative.

Standard & Poor's will continue to monitor the performance of
this franchise loan securitization to assure that the remaining
ratings continue to accurately reflect the risks associated with
this transaction.

                        Ratings Lowered

           Atherton Franchisee Loan Funding 1999-A LLC

                      Rating
  Class     To              From              Balance (Mil. $)
  B         D               BBB/Watch Neg     7.710
  C         D               B-/Watch Neg      6.976
  D         D               CCC/Watch Neg     7.343


AVAYA INC: Names Louis D'Ambrosio to Lead Sales Operations
----------------------------------------------------------
Avaya Inc. (NYSE: AV), a leading global provider of
communications networks and services to businesses, has named
Louis J. D'Ambrosio, group vice president, worldwide services,
reporting to Don Peterson, Avaya chairman and CEO.

D'Ambrosio will be responsible for sales, marketing, product
development and operations for Avaya Services, an organization
of more than 8,000 professionals worldwide that design, build
and manage communications networks for businesses.

Avaya Services, with $2 billion in annual revenues, provides the
most comprehensive full life-cycle services in the industry
including network consulting and assessment; multi-vendor
services; security; integration; and implementation as well as
maintenance and management.  Avaya Services supports customers
in more than 90 countries through 30 network operations centers
worldwide.

D'Ambrosio joins Avaya after a 16-year career at IBM where he
held senior executive positions in Software, Customer Units, and
Global Services.  Most recently, he was vice president,
Worldwide Marketing, Sales, and Operations for IBM's profitable,
$11 billion software business.  In that capacity, he led a
12,000-person team  --- across sales, services, brand
management, advertising, channels, and operations - to industry
leading growth and market share gains.

Prior to this, D'Ambrosio held other key leadership roles
including vice president, Marketing Development and Execution,
where he led the optimization of IBM's go-to-market model;
general manager of a 20-country industry unit in Asia Pacific
based in Tokyo; and director of worldwide strategy for Global
Services when it was formed, where he led the original strategy
and execution plan to integrate and grow IBM services to $20
billion.  D'Ambrosio was a member of IBM's worldwide management
committee, comprised of the company's top executives.

"Services is at the core of our value proposition to the
marketplace and critical to our growth," said Don Peterson,
chairman and CEO of Avaya.  "We are fortunate to have Lou
D'Ambrosio join our team.  Lou's leadership, strategic and
analytical thinking, and proven track record in building
profitable, growth-oriented businesses will be essential as we
accelerate our plans to expand Avaya's voice and data management
services business."

"I am delighted to join the Avaya team and excited about the
impact Avaya could have in the marketplace," said D'Ambrosio.
"Avaya is in an enviable position of having one million
customers and an outstanding technology and services portfolio.
I believe Avaya is uniquely positioned to deliver
communications-driven services and solutions to help enterprises
reduce costs and win in the marketplace."

D'Ambrosio received a Bachelor of Science from Pennsylvania
State University, summa cum laude and valedictorian, and M.B.A.
from Harvard Business School.

Avaya Inc. designs, builds and manages communications networks
for more than 1 million businesses worldwide, including 90
percent of the FORTUNE 500(R). Focused on businesses large to
small, Avaya is a world leader in secure and reliable Internet
Protocol telephony systems and communications software
applications and services. Driving the convergence of voice and
data communications with business applications -- and
distinguished by comprehensive worldwide services -- Avaya helps
customers leverage existing and new networks to achieve superior
business results.  For more information, visit the Avaya Web
site at http://www.avaya.com

                          *   *   *

As previously reported in the September 6, 2002 issue of the
Troubled Company Reporter, Standard & Poor's Ratings Services
lowered its corporate credit rating on enterprise communications
equipment and services provider Avaya Inc., to double-'B'-minus
from double-'B'-plus, lowered its senior secured debt rating to
single-'B'-plus from double-'B'-minus, and lowered its senior
unsecured debt rating to single-'B' from double-'B'-minus. At
the same time, Standard & Poor's removed the ratings from
CreditWatch, where they were placed on July 31, 2002. The
outlook is negative.


BABCOCK & WILCOX: McDermott, et al., File Consensual Plan
---------------------------------------------------------
McDermott International Inc., (NYSE:MDR) said that the Company,
together with the Asbestos Claimants' Committee and the Legal
Representative for Future Asbestos-Related Claimants, has filed
a substantially complete consensual plan of reorganization and
settlement agreement in the Chapter 11 Bankruptcy Proceedings
involving The Babcock & Wilcox Company with the U.S. Bankruptcy
Court for the Eastern District of Louisiana.

The Settlement Agreement between McDermott and certain of its
subsidiary companies, the ACC and the FCR is subject to various
conditions, including the requisite approval of the asbestos
claimants, the Bankruptcy Court's confirmation of the plan of
reorganization and approval of McDermott's shareholders.

"The filing of the consensual plan of reorganization is a
reflection of the time and effort we have dedicated to bringing
the B&W Chapter 11 proceedings to a close. We are pleased to
have made this filing and with the progress we have made so
far," said Bruce W. Wilkinson, chairman of the board and chief
executive officer of McDermott.

A summary of the key terms of the Settlement Agreement, which
are substantially the same as those previously reported, are as
follows:

     -- McDermott would assign all of its equity in B&W to a
trust to be created for the benefit of asbestos-related personal
injury claimants.

     -- McDermott and all of its subsidiaries would assign,
transfer or otherwise make available to the Trust their rights
to certain applicable insurance proceeds.

     -- McDermott would issue 4.75 million shares of restricted
McDermott common stock to the Trust. The resale of the shares
would be subject to certain limitations in order to provide for
an orderly means of selling the shares to the public. Certain
sales by the Trust would also be subject to McDermott's right of
first refusal. If any of the shares issued to the Trust are
still held by the Trust three years after the date of plan
confirmation, and to the extent those shares could not have been
sold in the market at a price greater than or equal to $19 per
share (based on quoted market prices) taking into account the
restrictions on sale and any waivers of those restrictions that
may be granted by McDermott from time to time, McDermott would
effectively guarantee that those shares would have a value of
$19 per share. McDermott would be able to satisfy this guaranty
obligation by making a cash payment or through the issuance of
additional shares of its common stock. If McDermott elects to
issue shares to satisfy this guarantee obligation, it generally
would not be required to issue more than 12.5 million shares.

     -- McDermott or one of its U.S. subsidiaries would issue an
aggregate of $92 million of promissory notes to the Trust. The
notes would be unsecured obligations with principal payments of
$8.36 million per year, for eleven years, and a 7.5% interest
rate.

     -- McDermott and all of its past and present directors,
officers and affiliates would receive the full benefit of
Section 524(g) of the Bankruptcy Code with respect to all
pending and future personal injury asbestos-related claims
relating to B&W and would be released and protected from all
other pending and future asbestos-related claims stemming from
B&W's operations, as well as claims of any other kind relating
to B&W, including claims relating to the 1998 corporate
reorganization that has been the subject of litigation in the
Chapter 11 bankruptcy proceedings.

     -- The settlement would be conditioned on the approval by
McDermott's stockholders of the terms of the settlement outlined
above.

The Company expects the Bankruptcy Court will schedule further
proceedings concerning this matter. The Company anticipates that
the process of finalizing and implementing this settlement could
take up to nine months, depending on the nature and extent of
any objections or appeals in the bankruptcy case. There are
certain issues that the Company is continuing to negotiate with
the ACC and FCR. When a final settlement becomes probable, the
Company currently estimates that, subject to further
negotiations, it would record an after-tax charge against
earnings of between $100 million to $130 million, reflecting the
present value of the Company's contributions and contemplated
payments to the Trust as outlined above. This charge would be in
addition to the $220.9 million after-tax charge the Company
recorded in the quarter ended June 30, 2002 when it wrote off
its investment in B&W and other related assets.

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


BCE TELEGLOBE: Fitch Withdraws D Note Ratings Due to Bankruptcy
---------------------------------------------------------------
Fitch Ratings affirms and withdraws the ratings of BCE
Teleglobe. The withdrawal reflects the company's current state
of bankruptcy and liquidation. Teleglobe's core voice and data
business are in the process of being sold for C$155.3 million
(approximately $98 million).

           The following ratings are being withdrawn:

      -- Senior Unsecured Notes 'D'


BURLINGTON: Inks Pact Lifting Stay for Allens to Pursue Claims
---------------------------------------------------------------
Christopher and Tracey Allen, parents of Spencer Allen -- a
minor, are plaintiffs in a postpetition lawsuit filed against
B.I. Transportation, Inc. and Donald Ray Bumgardner -- a former
employee of the Debtors.  The lawsuit is pending before the
United States District Court for the Northern District of
Georgia, Atlanta Division.

The type of claim asserted by the Allens against B.I. and Mr.
Bumgardner in the District Court Action is covered by an auto
insurance policy with Reliance National.  The Reliance Policy
has a $1,000,000 deductible that is reinsured by B.I. with
Insuratex Ltd., a non-Debtor offshore captive insurance company
owned by B.I.

The Insuratex Policy provides for both defense and liability
insurance coverage to B.I. and Mr. Bumgardner.

B.I. Transportation wants to permit the District Court Action to
proceed to full and final adjudication.  Any recovery granted to
the Allens against B.I. or Mr. Bumgardner in the District Court
will be paid by Insuratex under the Insuratex Policy and, to the
extent the Deductible id exhausted, Reliance under the Reliance
Policy.

Specifically, in a Court-approved Stipulation, the parties agree
that:

   -- the automatic stay imposed by Section 362 of the
      Bankruptcy Code will be modified solely to the extent
      necessary to permit the District Court Action to be fully
      and finally adjudicated;

   -- the Allens may enforce or execute on judgment obtained
      against B.I. or Mr. Bumgardner in the District Court
      Action only by pursuing available proceeds under the
      Insuratex Policy and the Reliance Policy; and

   -- the Allens will not engage in any efforts to collect
      amounts from B.I., the other Debtors, their properties, or
      Mr. Bumgardner and will not be entitled to a claim in B.I.
      or the Debtors' Chapter 11 cases relating to the District
      Court Action or the allegations asserted against B.I. or
      Mr. Bumgardner. (Burlington Bankruptcy News, Issue No. 22;
      Bankruptcy Creditors' Service, Inc., 609/392-0900)


CNA FINANCIAL: Sells $750 Million of New Preferreds to Loews
------------------------------------------------------------
CNA Financial Corporation (NYSE:CNA) has completed its
previously announced plan to sell $750 million of a new issue of
preferred stock, called Series H Cumulative Preferred Stock, to
Loews Corporation, the owner of 90% of CNA's outstanding common
stock. The terms of the new Series H Cumulative Preferred Stock
have been approved by a special committee of independent members
of CNA's Board of Directors. The principal terms of the Series H
Cumulative Preferred Stock are as follows:

     -- The new preferred stock will accrue cumulative dividends
at an initial rate of 8% per year. The dividend rate will be
adjusted quarterly to a rate equal to 400 basis points above the
ten year U.S. Treasury rate, beginning with the quarterly
dividend after the first to occur of the following two events:
(i) an increase by two intermediate ratings levels of the
financial strength rating of CNA's principal insurance
subsidiary, Continental Casualty Company, from its current
rating by any of A. M. Best Company, Standard & Poor's or
Moody's Investor Services; or (ii) one year following an
increase by one intermediate ratings level of the financial
strength rating of Continental Casualty by any one of such three
rating agencies.

     -- Accrued but unpaid cumulative dividends cannot be paid
on the Series H Preferred Stock unless and until Continental
Casualty's financial strength rating has been increased by two
intermediate rating levels, or one year after Continental
Casualty's financial strength rating has been increased by one
intermediate rating level, if earlier, as described above.
However beginning with the quarter following an increase of one
intermediate rating level in Continental Casualty's financial
strength rating, current quarterly dividends (but not accrued
cumulative dividends) can be paid.

     -- The Series H Cumulative Preferred Stock will not be
convertible into any other securities of CNA and will be non-
voting. The preferred stock may be redeemed only upon the mutual
agreement of CNA and a majority of the holders of the new
preferred stock.

     -- The new preferred stock will rank senior to CNA's common
stock as to the payment of dividends and amounts payable upon
liquidation, dissolution or winding up. No dividends may be
declared on CNA's common stock until all cumulative preferred
dividends have been paid in full. CNA may not issue any equity
securities ranking senior to or on par with the new preferred
stock without the consent of a majority of the holders of the
Series H Cumulative Preferred Stock.

CNA intends to use the $750 million of proceeds from the
preferred stock to repay debt, including prepayment of $250
million in bank debt prior to December 31, 2002, to improve
Continental Casualty Company's statutory surplus and for other
corporate purposes.

CNA is the country's fourth largest commercial insurance writer,
the ninth largest property and casualty company and the 51st
largest life insurance company. CNA's insurance products include
standard commercial lines, specialty lines, surety, reinsurance,
marine and other property and casualty coverages; life and
accident insurance; group long term care, disability and life
insurance; and pension products. CNA services include risk
management, information services, underwriting, loss control and
claims administration. For more information, please visit CNA at
http://www.cna.com

                         *     *     *

As reported in Troubled Company Reporter's November 25, 2002
edition, A.M. Best Co., affirmed the financial strength ratings
of the wholly-owned insurance subsidiaries of CNA Financial
Corporation (Chicago, IL).

Additionally, A.M. Best has affirmed the "bbb" debt rating on
CNA Financial Corporation's existing debt securities, a rating
of AMB-2 to the commercial paper program and indicative ratings
to corporate securities under a $600 million shelf registration
filed in 1999. These indicative ratings include "bbb" on senior
unsecured debt, "bbb-" on subordinated debt, "bb+" on trust
preferred securities and "bb+" on preferred stock.


CLAXSON INTERACTIVE: Amends Chilean Syndicated Credit Facility
--------------------------------------------------------------
Claxson Interactive Group Inc., has completed negotiations with
a syndicate of Chilean banks under its Chilean syndicated credit
facility. As of this date, the long-term portion of this debt
will no longer be classified as short-term debt on Claxson's
balance sheet.

On October 26, 2000, Iberoamerican Radio Holdings Uno Chile
S.A., a Claxson subsidiary, obtained the Syndicated Credit
Facility for a total amount of US$35.0 million, denominated in
Chilean Pesos, of which US$18.2 million was outstanding as of
September 30, 2002. As of the first quarter of 2002, Radio Chile
was not in compliance with certain financial ratios required
under the Syndicated Credit Facility, primarily due to the
decrease in the value of the Chilean Peso against the U.S.
Dollar in 2001.

The amended terms for the Syndicated Credit Facility include (i)
modification of financial covenant ratios, (ii) extension of the
term of the loan by one year to mature on May 5th 2006 and, as a
result, a reduction of the quarterly amortization, (iii)
increase in the interest rate by 25 basis points to the Tasa
Activa Bancaria plus 2.75%. In addition, Claxson will be
required to maintain a US$1.5 million deposit in a Chilean bank,
and Chilevision, Claxson's broadcast television operation in
Chile, will guarantee the Syndicated Credit Facility.

"This negotiation is one more step in meeting our commitment to
improve Claxson's financial position. Back in early November, we
completed the exchange offer and consent solicitation related to
Imagen Satelital's Senior Notes, and [Thurs]day we regained
compliance and negotiated new terms for our Chilean debt," said
Jose Antonio Ituarte, Chief Financial Officer, Claxson. "These
steps are certainly in the right direction and we could have not
achieved them without the support Radio Chile had from its bank
syndicate."

Claxson Interactive Group Inc., is a multimedia company
providing branded entertainment content targeted to Spanish and
Portuguese speakers around the world. Claxson has a portfolio of
popular entertainment brands that are distributed over multiple
platforms through its assets in pay television, broadcast
television, radio and the Internet. Claxson was formed on
September 21, 2001 in a merger transaction, which combined El
Sitio, Inc., and other media assets contributed by funds
affiliated with Hicks, Muse, Tate & Furst Inc., and members of
the Cisneros Group of Companies. Headquartered in Buenos Aires,
Argentina, and Miami Beach, Florida, Claxson has a presence in
all key Ibero-American countries, including without limitation,
Argentina, Mexico, Chile, Brazil, Spain, Portugal and the United
States.

At Sept. 30, 2002, Claxson's balance sheet shows a total
shareholders' equity deficit of about $14 million.


COLD METAL PRODUCTS: Will Move Corp. Headquarters to Youngstown
---------------------------------------------------------------
Cold Metal Products, Inc. (Amex: CLQ), a leading North American
intermediate strip steel processor, plans to move its corporate
headquarters back to Youngstown, Ohio, immediately.  Cold Metal
headquarters had been in Sewickley, Pa., since April 2000.

"We're looking at every possible avenue to reduce costs as we
reorganize under Chapter 11 bankruptcy protection," said Cold
Metal President and CEO Raymond P. Torok. "We've taken advantage
of several opportunities to take significant cost out of our
overhead expenses. This is another opportunity to do so as we
were able to negotiate a favorable lease rate for these new
offices."

Cold Metal's new address is 839 Southwestern Run, Youngstown, OH
44514. The company's toll free number remains 1-800-837-3300.
The company's new direct phone number is 330-758-8341 and the
fax number is 330-726-6150. Cold Metal also maintains an
administrative office in Youngstown at 8526 South Ave. and
continues operations in Ottawa, Ohio; Detroit, Mich.;
Indianapolis, Ind.; Hamilton, Ontario; and Montreal, Quebec.

Cold Metal filed for Chapter 11 bankruptcy protection August 16
citing unprofitable facilities, burdensome legacy costs and
pricing pressures as the primary reasons for the filing.

A leading North American intermediate strip steel processor,
Cold Metal Products provides a wide range of steel strip
products to meet the critical requirements of precision parts
manufacturers. Through cold rolling, annealing, normalizing,
edge conditioning, oscillate winding, slitting and cutting to
length, the company provides value-added products to
manufacturers in the automotive, construction, cutting tools,
consumer goods and industrial goods markets. Cold Metal Products
operates plants in Ottawa, Ohio; Detroit, Mich.; Indianapolis,
Ind.; Hamilton, Ontario; and Montreal, Quebec. The company
employs approximately 350 people.


CONSECO FINANCE: S&P Drops Related Trust Ratings to D
-----------------------------------------------------
Standard & Poor's Ratings Services lowered its ratings to 'D'
from 'CCC-' on five classes from various Conseco Finance Corp.-
related series issued by Home Improvement Loan Trust, Home
Improvement & Home Equity Loan Trust, Home Equity Loan Trust,
and Green Tree Home Improvement & Home Equity Loan Trust.

Conseco Finance Corp., did not make any payments under the
limited guarantee on the Dec. 16, 2002 distribution date,
resulting in interest shortfalls on these classes.

The ratings on these certificates were lowered to 'CCC-' from
'CCC+' on September 12, 2002, as a result of analysis
determining that the monthly excess spread alone might not be
sufficient to offset the weakening credit quality of the
guarantor, Conseco Finance Corp.

Each of the certificates has credit support from a limited
guarantee provided by Conseco Finance Corp., and from the
monthly excess spread.

                    Ratings Lowered

              Home Improvement Loan Trust

                                  Rating
       Series    Class       To           From
       1996-A    B-2         D            CCC-

         Home Improvement & Home Equity Loan Trust

                                  Rating
       Series    Class       To           From
       1998-B    HI:B2       D            CCC-

                 Home Equity Loan Trust

                                  Rating
       Series    Class       To           From
       1999-C    B-2         D            CCC-
       1999-D    B-2         D            CCC-

     Green Tree Home Improvement & Home Equity Loan Trust

                                  Rating
       Series    Class       To           From
       1999-B    B-2         D            CCC-


CONTINENTAL AIR: Extending Review Period of Proposed Alliance
-------------------------------------------------------------
Continental Airlines (NYSE: CAL), in response to the U.S.
Department of Transportation's announcement Thursday that it
will extend the review period of the proposed alliance among
Continental, Delta and Northwest and had received complaints
regarding allegedly anti-competitive actions taken by those
carriers, issued the following statement:

"In connection with its unrelated review of our proposed
codesharing alliance with Delta and Northwest, the DOT has told
us that America West has complained about competitive responses
that Continental took in connection with America West's fare
restructuring in March 2002.

"Continental's competitive responses to America West's actions
were totally lawful and in full compliance with the antitrust
laws. America West's complaint is without merit. That complaint
is about totally unrelated and lawful actions which preceded the
formation of our proposed alliance. The DOT is inappropriately
linking its review with unrelated, unfounded allegations of a
competitor.

"The DOT's attempt to hold our alliance hostage in order to
support the unfounded allegations of an airline partly owned by
the U.S. government is an attempt to inappropriately protect a
competitor, rather than competition.

"We are surprised that the DOT believes that our proposed
alliance raises competitive concerns, since we months ago
satisfactorily concluded our discussions with the Department of
Justice concerning the alliance. The Department of Justice is
the agency responsible for enforcing the antitrust laws with
respect to airlines.

"Most importantly, this further review extension by the DOT will
delay the ability of Continental, Delta and Northwest customers
to access the broader alliance network, and postpone the great
consumer benefits that this pro- competitive alliance will
bring."

DebtTraders reports that Continental Airlines' 8.000% bonds due
2005 (CAL05USR1) are trading between 57 and 59. See
http://www.debttraders.com/price.cfm?dt_sec_ticker=CAL05USR1for
real-time bond pricing.


CONTOUR ENERGY: Texas Court Confirms Plan of Reorganization
-----------------------------------------------------------
Contour Energy Co., announced that the United States Bankruptcy
Court for the Southern District of Texas, Houston Division has
confirmed Contour's First Amended Debtors' Joint Plan of
Reorganization Under Chapter 11 of the Bankruptcy Code, as
Modified.

The Final Plan provides that the general unsecured class of
creditors will be paid in full, so long as the claims within
that class are less than the Unsecured Claims Cap. The
"Unsecured Claims Cap" is defined in the Final Plan as
$1,750,000 plus the amount, if any, of general unsecured claims
attributable to current or suspended royalties, joint interest
billings, and certain license and membership fees. While a full
reconciliation of claims has not yet been completed, based on
the information available at this time the Company believes
general unsecured claims will ultimately be less than the
Unsecured Claims Cap and general unsecured creditors will
receive payment of allowed claims in full. If the general
unsecured claims do exceed the Unsecured Claims Cap, all general
unsecured creditors will share pro rata in the amount of the
Unsecured Claims Cap.

Contour continues to pay in full its royalty obligations in the
normal course of business. Under the Final Plan Contour will
assume the operating and related agreements covering oil and gas
leases and anticipates that any amounts owed to joint working
interest owners will be paid in full upon verification of the
claims.

The Final Plan provides for payment of the 14% senior secured
notes in full with interest at the non-default rate upon closing
using proceeds from a new revolving credit facility, newly
issued subordinated debt, and cash on hand. The holders of the
Company's $155 million of 10-3/8% senior subordinated notes will
receive all the Company's post-confirmation equity.

Under the Final Plan, existing holders of Contour common stock,
in the aggregate, will receive the lesser of $750,000 or the
amount by which total general unsecured claims are less than the
Unsecured Claims Cap. Until final resolution of the general
unsecured claims, the amount payable in the aggregate to holders
of common stock cannot be determined with certainty. However,
based on information available at this time, the Company
believes that holders of common stock will receive their pro
rata share of $750,000.

The Confirmation Order and Final Plan will be posted on the
Contour Energy Co., Web site -- http://www.contourenergy.com--
as soon as it is made available. Contour Energy Co. is engaged
in the exploration, development, acquisition and production of
natural gas and oil.

Contour Energy Co., common stock is traded on the Pink Sheets
under the symbol CONC.


COVANTA: Stipulation re Traveler's Settlement with Yuba Approved
----------------------------------------------------------------
Covanta Energy Corporation, and its debtor-affiliates do not
object to the Settlement Agreement between Travelers Indemnity
Company and Yuba Heat Transfer, a division of Connell Limited
Partnership.  Hence, the Debtors and Travelers entered into a
Court-approved Stipulation and Order providing that:

1. Travelers is authorized to pay to Connell the Indemnification
   Costs, subject to the terms, conditions and mutual agreements
   set forth herein;

2. The Debtors are not obligated to pay to Travelers or Connell
   any amounts as retrospective premiums or other obligations
   under the Insurance Policies on account of the
   Indemnification Costs.  Travelers agrees that it will not
   assert any claims against any of the Debtors or their
   affiliates in respect of any retrospective premiums or other
   obligations under the Insurance Policies on account of the
   Indemnification Costs, and Travelers waives any claims
   against any of the Debtors and their affiliates;

3. The Indemnification Costs, including the Retrospective
   Premiums paid by Connell, and litigation fees, costs and
   expenses incurred in connection with the Connell Claims will
   be applied to the maximum retrospective premium under the
   Insurance Policies;

4. The aggregate limit of liability under the Insurance Policies
   will be reduced by no more than the Indemnification Costs of
   $2,000,000.  Litigation fees, costs and expenses incurred in
   connection with the Connell Claims will not be applied to
   reduce the aggregate liability limits under the Insurance
   Policies;

5. Within 10 days after Travelers makes any payment to Connell
   on account of the Future Settlement Payment, Travelers will
   provide to the Debtors and their counsel written notification
   of the payment;

6. Except as otherwise set forth herein, the provisions of
   Section 362(a) of the Bankruptcy Code will remain in full
   force and effect and will not be deemed modified or waived in
   any manner;

7. Nothing herein will be deemed to constitute approval of
   payment of the Indemnification Costs subject to the terms,
   conditions and mutual agreements set forth herein;

8. The parties agreed that the Debtors will not be bound by any
   interpretation or construction by Travelers or Connell of the
   Insurance Policies, the Settlement Agreement or the final
   settlement agreement executed by Travelers and Connell; and

9. Nothing herein will prejudice:

   -- the rights of the Debtors to oppose or seek other orders
      as are in the best interest of the estates; or

   -- the rights of the Debtors to prosecute or defend against
      the merits of any allegations asserted in claims against
      the Insurance Policies and any subsequent appellate
      proceedings with respect to the Insurance Policies.
      (Covanta Bankruptcy News, Issue No. 19; Bankruptcy
      Creditors' Service, Inc., 609/392-0900)


COVISTA COMMS: Shareholders Approve Equity Sale to Henry Luken
--------------------------------------------------------------
Covista Communications, Inc.'s (NASDAQ: CVST) shareholders have
overwhelmingly approved the issuance and sale of up to 4,350,000
shares of its common stock for $2.867 per share to its Chairman,
Henry G. Luken, III in exchange for a $12,500,000 equity
infusion consisting of the conversion of $7,000,000 debt owed to
Mr. Luken and the contribution by him of $2,200,000 cash and
$3,300,000 in assets, primarily telecommunications switching
equipment.

In addition, Shareholders also elected Directors and approved
the Company's 2002 Equity Incentive Plan and the selection by
the Company's Audit Committee of Deloitte & Touche, as the
Company's independent auditors for its fiscal year ending
January 31, 2003.

At a Board of Director's meeting held following the
Shareholders' Meeting, the Board authorized, with Mr. W. Thorpe
McKenzie, a newly elected Director abstaining, the issuance of
up to one million shares which includes the sale of 500,000
shares of Common Stock to Mr. McKenzie, for $1,433,500 or $2.867
per share.

John Leach, President and CEO of Covista, stated, "This
investment represents the confidence that both Messrs. Luken and
McKenzie have in the future of Covista. This infusion of capital
greatly improves Covista's Balance Sheet and substantially
increases Shareholders' Equity. With the Company's return to
positive cash flow in the quarter ended October 31, 2002 and the
increase in sales, I am confident that Covista has accomplished
a significant turnaround and should continue to reflect
improvements in its operations. We are proud to welcome W.
Thorpe McKenzie to our Board and to the Company's Audit
Committee. With his background in investment and finance, he
brings invaluable expertise to our Board."

Covista is a facilities-based long distance telecommunications,
Internet and data services provider with a substantial customer
base in the residential, commercial and wholesale market
segments. Its products and services include a broad range of
voice, data and Internet solutions, including long distance and
toll-free services, calling cards, frame relay, Internet access,
VPN, directory assistance and teleconferencing services. The
wholesale division provides domestic and international
termination services to carriers worldwide. Covista currently
owns and operates switches in New York City, Newark, New Jersey,
Philadelphia, Dallas, Chattanooga, and Minneapolis. Covista
operates Network Operations, call center and information
technology facilities in Chattanooga to monitor its switched
network and to coordinate its various services. For information
on becoming a Covista customer, please telephone 800-805-1000 or
visit the Company's Web site at http://www.covista.com

Covista Communications' July 31, 2002 balance sheet shows that
total current liabilities exceeded total current assets by about
$13 million.


CTC COMMUNICATIONS: Committee Hires Saul Ewing as Local Counsel
---------------------------------------------------------------
The Official Committee of Unsecured Creditors of CTC
Communications Group, Inc., and its debtor-affiliates secured
approval from the U.S. Bankruptcy Court for the District of
Delaware to retain Saul Ewing as its co-counsel to perform the
legal services that will be necessary during these cases.

The Committee submits that it is essential for the Committee to
employ Brown Rudnick Berlack Israels, LLC and Saul Ewing as
their counsel in these cases.  BRBI and Saul Ewing will make
every effort to prevent any needless duplication of effort.
Particularly, the Committee needs to retain Saul Ewing because
the members, counsel, and associates of BRBI are not Delaware
lawyers.

The attorneys and paralegals presently designated to represent
the Committee and their current standard hourly rates are:

     Mark Minuti (partner)                    $365 per hour
     Donald J. Detweiler (special counsel)    $275 per hour
     Tara Lattomus (associate)                $260 per hour
     Jeremy W. Ryan (associate)               $250 per hour
     Rebecca Street (associate)               $150 per hour
     Jason Kittinger (paralegal)              $115 per hour
     Veronica Parker (case management clerk)  $ 65 per hour

Saul Ewing is expected to:

     a) provide legal advice with respect to the Committee's
        rights, powers and duties in these cases;

     b) prepare on behalf of the Committee all necessary
        applications, answers, responses, objections, forms of
        orders, reports and other legal papers;

     c) represent the Committee in any and all matters involving
        contests with the Debtors, alleged secured creditors,
        and other third parties;

     d) assist the Committee in its investigation and analysis
        of the Debtors and the operations of the Debtors'
        businesses; and

     e) perform all other legal services for the Committee which
        may be necessary and proper in these proceedings.

CTC Communications Group, Inc., a source provider of voice,
data, and Internet Communications services to medium and larger
sized business customers, filed for chapter 11 protection on
October 3, 2002. Pauline K. Morgan, Esq., at Young, Conaway,
Stargatt & Taylor, represents the Debtors in their restructuring
efforts. When the Company filed for protection from its
creditors, it listed $306,857,985 in total assets and
$394,059,938 in total debts.


DOLE FOOD: S&P Keeps Lower-B Level Ratings on Watch Negative
------------------------------------------------------------
Standard & Poor's lowered the corporate credit rating on fresh
fruit and vegetable producer Dole Food Co., Inc., to 'BB' from
'BBB-'. The rating downgrade follows Dole's announcement that it
has signed a definitive merger agreement with David Murdock, who
will acquire the approximately 76% of Dole's outstanding common
stock that he or his family does not currently own for $33.50
per share. The total enterprise value of the transaction,
including the assumption of debt, is approximately $2.5 billion.

The ratings action reflects a significant increase in financial
risk related to the leveraged buyout. Under the proposed
transaction, the company's 4x total debt to EBITDA would be well
beyond levels consistent with an investment-grade rating for
Dole's business profile.

The rating will remain on CreditWatch with negative implications
until the final details of the proposed financing are reviewed
and Standard & Poor's assesses the long-term financial
structure.

The 'BBB-'ratings on the $300 million, 7% notes due in 2003 and
the $300 million, 6.375% notes due in 2005 remain on CreditWatch
with negative implications. Because these notes are expected to
be retired at the close of the transaction, they will not be
downgraded if they are redeemed.

The ratings on the $400 million, 7.25% notes due in 2009 and the
$175 million, 7.875% debentures due in 2013 are lowered to 'B+'
(two notches below the corporate credit rating) to reflect the
proposed large amount of secured debt needed to complete the
transaction. The transaction would essentially subordinate the
position of these notes within the capital structure.

"Standard & Poor's will meet with management to review the final
capital structure and discuss the company's long-term strategic
objectives under new ownership," said Standard & Poor's credit
analyst Ronald B. Neysmith.


DYNEGY: Unit Completes Settlement with Futures Trading Regulator
----------------------------------------------------------------
Dynegy Inc.'s (NYSE:DYN) subsidiary, Dynegy Marketing and Trade,
has concluded a settlement with the Commodity Futures Trading
Commission on a previously disclosed investigation relating to
the inaccurate reporting of information on natural gas trades to
energy industry publications that compile and report index
prices. As a result, the CFTC issued an order filing and
simultaneously settling an administrative action against Dynegy
Marketing and Trade. Dynegy Marketing and Trade agreed to pay a
civil monetary penalty in the amount of $5 million without
admitting or denying the findings in the CFTC's order. The CFTC
made no findings against Dynegy with respect to round trip
trades, which were also a focus of the CFTC's now-concluded
investigation.

Dynegy previously reported that, as a result of an internal
investigation, the company discovered circumstances where
inaccurate information regarding natural gas trades was reported
by employees to various energy industry publications that
compile and report index prices. This activity was in direct
violation of the company's Code of Business Ethics. In response
to its findings, Dynegy Marketing and Trade has dismissed seven
employees and disciplined seven. In addition, the company has
instituted measures that will ensure that the office of the
chief risk officer verifies all price information. Dynegy is not
aware of any evidence that any of the faulty reporting
materially affected any of the price indices.

Dynegy's cooperation with the CFTC was expressly noted in the
agency's order. In addition, the company continues to cooperate
with the U.S. Attorney's Office and the Federal Energy
Regulatory Commission in their investigations into this matter.

Dynegy Inc., owns operating divisions engaged in power
generation, natural gas liquids and regulated energy delivery.
Through these business units, the company serves customers by
delivering value-added solutions to meet their energy needs. The
company's Web site is http://www.dynegy.com

                         *     *     *

As previously reported, Dynegy Holdings Inc.'s senior unsecured
debt rating was downgraded to 'BB+' from 'BBB' by Fitch Ratings.
In addition, Fitch downgraded Dynegy Inc.'s indicative senior
unsecured debt to 'BB+' from 'BBB-'. The short-term ratings for
DYNH and DYN' have been lowered to 'B' from 'F3'. The ratings
for DYN and DYNH remain on Rating Watch Negative where they were
originally placed on Nov. 9, 2001. In addition, ratings for
affiliated companies, Illinois Power Co., and Illinova Corp.,
have been lowered and remain on Rating Watch Negative.

Dynegy Holdings Inc.'s 8.125% bonds due 2005 (DYN05USR1) are
trading between 36 and 38, DebtTraders says. See
http://www.debttraders.com/price.cfm?dt_sec_ticker=DYN05USR1for
real-time bond pricing.


ECHOSTAR COMMS: Massachusetts Fin'l Discloses 6.8% Equity Stake
---------------------------------------------------------------
Massachusetts Financial Services Company beneficially owns
16,315,616 shares of the common stock of EchoStar Communications
Corporation, representing 6.8% of the outstanding common stock
of the Company.  MFS holds sole powers of voting and/or
disposing of the stock held.  These shares of common stock
include 832,774 shares of common stock which may be acquired
through conversion of convertible preferred stock.

At September 30, 2002, Echostar's balance sheet shows a total
shareholders' equity deficit of close to $1 billion.


EMPIRIC ENERGY: Inks Pact to Acquire Venture Energy Projects
------------------------------------------------------------
James J. Ling, CEO of Empiric Energy Inc., (OTCBB:EMPE) a
Dallas-based oil and gas company, announced the signing of a
definitive contract to acquire from Venture Energy Inc., several
on going projects located in Louisiana, with a closing to occur
on or before Dec. 28, 2002.

Mr. Gordon Johnson, President of Venture Energy Inc., made the
following statement relative to the properties and leases being
acquired from Venture Energy Inc., by EEI. "There are several
projects involved in Empiric Energy Inc.'s acquisition, which
will initially produce approximately 250 BOPD and 300 mcfpd. By
the beginning of the second quarter of 2003, production should
be in the 500 BOPD and gas at 500 mcfpd. Previously prepared
reserves reports indicate approximately 500,000 BBL's will be
assigned to Empiric Energy Inc. working interest, plus
approximately 2 bcf gas."

Mr. Ling announced the overwhelming approval of EEI shareholders
authorizing the proposal to restructure the EEI common shares
and issuance of a new Liquidating Series "L" Preferred equal to
$1.00 per share for each EEI Common Share outstanding, and is
convertible into 1/10 share of EEI common stock. Over
simplified, each 100 EEI Common Share will convert into 50 EEI
new common shares, and 10 shares of Series "L" shares with a
liquidation value of $100.00, and convertible into 10 shares of
EEI common stock. The effective date for Empiric's Capital
Restructuring Program is Jan. 14, 2003.

Mr. Ling has received notification from Anderson Exploration
Inc. the long rain delayed (five months) installation of a gas
meter and activation of a gas well in Southern Louisiana, will
occur within the next few days, and work on the re-entry well in
the same field will commence within the next three weeks.

Empiric Energy's September 30, 2002, balance sheet shows a
working capital deficit of about $382,000.


ENCOMPASS SERVICES: Court Grants Priority to Postpetition Goods
---------------------------------------------------------------
As of the Petition Date, Encompass Services Corporation and its
debtor-affiliates had numerous pending outstanding orders for
materials, supplies, goods, products and related items from
their vendors.  But as a result of their Chapter 11 filing, the
Debtors believe that many of the vendors may be concerned that
the postpetition delivery or shipment of goods with respect to
prepetition purchase orders will render the vendors general
unsecured creditors of the Debtors' estates.

According to Lydia T. Protopapas, Esq., at Weil Gotshal & Manges
LLP, the vendors may decline to ship or may instruct their
shippers not to deliver goods destined for the Debtors, unless
the Debtors:

   -- issue substitute purchase orders postpetition; or

   -- obtain a Court order confirming that all undisputed
      obligations arising from the postpetition delivery of
      goods and materials subject to prepetition Outstanding
      Orders are afforded administrative expense priority.

Encompass Services Corporation sought and obtained authority
from Judge Greendyke to:

   (a) grant the vendors administrative expense priority status
       for the undisputed obligations arising from the
       Outstanding Orders that are delivered subsequent to the
       Petition Date; and

   (b) authorize them, in their sole discretion in the exercise
       of their business judgment and in accordance with their
       customary business practices, to satisfy those undisputed
       obligations to the vendors in the ordinary course of
       business.

The Debtors believe that they have $24,000,000 in undisputed
obligations to the vendors arising from the Outstanding Orders.
(Encompass Bankruptcy News, Issue No. 3; Bankruptcy Creditors'
Service, Inc., 609/392-0900)


ENRON CORP: EMCC Wants Court Approval for Navan Settlement Pact
---------------------------------------------------------------
Melanie Gray, Esq., at Weil, Gotshal & Manges LLP, in New York,
tells the U.S. Bankruptcy Court for the Southern District of New
York that Enron Metals and Commodities Corp. is a party to:

   (a) a Copper Concentrate Purchase Agreement with Bimark A.D.,
       a company incorporated in Bulgaria and an affiliate of
       Navan Mining plc, dated as of December 1, 2000; and


   (b) a Copper Concentrate Agreement with Almagrera S.A., an
       affiliates of Navan, dated December 18, 2000.

Under the two agreements, EMCC agreed to prepay for copper
concentrates to be delivered by the Affiliates to EMCC in 2001.
Navan guaranteed the Affiliates' obligations under the
Agreements through a Guarantee Agreement dated December 19,
2000.

To mitigate the credit risk associated with Navan's performance
under the Guarantee, Ms. Gray explains that EMCC procured a
$9,000,000 insurance policy from Texel, an insurance broker.
Rightly so, the Affiliates failed to deliver any copper
concentrates as scheduled under the Agreements.

On December 5, 2001, EMCC demanded payment from Navan pursuant
to the Guarantee.  No payment has been received to date.  Thus,
on December 17, 2001, EMCC filed a claim with Texel.  This claim
is currently under review by loss adjusters for the underwriters
for the policy since January 2002.  The underwriters are
seriously questioning the validity of the claim.

Moreover, EMCC has been informed that Navan is facing severe
financial hardship and is on the brink of liquidation.  In an
effort to restructure, Navan is currently negotiating with all
of its unsecured creditors, including EMCC.

After conducting a review of its operations, EMCC decided to
settle the disputed issues with Navan consensually.  Settlement
negotiation between the parties reached these terms and
conditions:

   -- Navan will pay EMCC a $2,000,000 settlement cash
      component; and

   -- Navan will give EMCC a $2,000,000 worth of equity
      allotment.

Ms. Gray explains that the cash and equity payment is in full
and final satisfaction of all sums owing to EMCC from Navan
under the Agreements and the Guarantee.  The equity allotment
component is to be satisfied by a certain number of New Navan
Shares calculated in accordance with the terms of the Settlement
Agreement.  Furthermore, Ms. Gray informs Judge Gonzalez that
Navan has delivered the $2,000,000 cash settlement to JPMorgan
Chase Bank, as escrow agent, to be held in an escrow account
pending Court approval of the Settlement Agreement.

Accordingly, EMCC sought and obtained Court approval of the
Settlement Agreement with Navan as final satisfaction of the
Parties' obligations under the Agreements and Guarantee.

Ms. Gray contends that entry into the Settlement Agreement is
appropriate since:

   (a) the Parties will resolve all issues related to the
       Agreements and the Guarantee without any litigation;

   (b) possible unnecessary litigation expenses are prevented;

   (c) the EMCC estate is able to realize a value from the
       guarantee provided by a distressed company; and

   (d) the EMCC estate saves substantial administrative expenses
       -- including attorney's fees -- and the assets of EMCC's
       estate is preserved. (Enron Bankruptcy News, Issue No.
       51; Bankruptcy Creditors' Service, Inc., 609/392-0900)


EOTT ENERGY: Intends to Assume Two Premium Financing Agreements
---------------------------------------------------------------
One of the U.S. Trustee's requirements is that EOTT Energy
Partners, L.P., and its debtor-affiliates must maintain
insurance customary in their business as well as casualty
insurance, workers' compensation insurance, general liability
insurance and product liability insurance, and make all premium
payments on these insurance when due.

Prior to the Petition Date, Robert D. Albergotti, Esq., at
Haynes and Boone LLP, in Dallas, Texas, relates, the Debtors
financed their general liability, property and casualty, and
workers' compensation insurance premiums through Imperial A.I.
Credit Companies and Cananwill, Inc.

Accordingly, the Debtors seek the Court's authority to assume
the Premium Financing Agreements to give Imperial and Cananwill
the assurances they need to continue doing business with them.

Mr. Albergotti contends that the assumption is necessary because
pursuant to the terms of the Premium Financing Agreements, in
the event the Debtors default, Imperial or Cananwill may cancel
the policies and may receive and apply the unearned or return
premiums to the Debtors' account.  In the event monies still
remain due to Imperial or Cananwill, the deficiency will be
recognized as an administrative expense claim pursuant to
Section 503(b) of the Bankruptcy Code.

Moreover, Mr. Albergotti asserts, the assumption of the Premium
Financing Agreement is based on valid business justifications:

   (a) this method of financing insurance policy premiums is
       ordinary and customary in the Debtors' industry;

   (b) the Debtors are required to maintain insurance by the
       U.S. Trustee and make payments of the insurance premiums;
       and

   (c) the Premium Financing Agreements obviate the Debtors'
       need to pay the entire premium for each policy at one
       time, enabling them to better manage their use of cash.

The Debtors may be required during these Chapter 11 cases to
enter into similar premium financing agreements on new policies
to renew or replace existing policies.  Thus, the Debtors
further seek the Court's authority to enter into new premium
financing agreements from time to time, as appropriate, without
further Court order.

Mr. Albergotti proposes that instead of filing a new motion to
the Court, the Debtors will notify the U.S. Trustee, the
Official Committee of Unsecured Creditors and secured lenders in
writing of their intention to enter into a new premium financing
agreement.  If no objection is received within five business
days after notice, the Debtors will enter into the new premium
financing agreement without further Court order.  Otherwise, the
Debtors will file a motion with the Court requesting authority
to enter into the new premium financing agreement.  Mr.
Albergotti contends that this procedure provides sufficient
safeguard to the Debtors' creditors while permitting the Debtors
freedom to enter into new premium financing agreement without
the expense of filing and serving motions for approval of
premium financing agreements. (EOTT Energy Bankruptcy News,
Issue No. 7; Bankruptcy Creditors' Service, Inc., 609/392-0900)

DebtTraders reports that Eott Energy Partners/Fin.'s 11.000%
Bond Due '09 (EOT09USR1) are trading between 57 and 59. See
http://www.debttraders.com/price.cfm?dt_sec_ticker=EOT09USR1for
real-time bond pricing.


EUROTECH LTD: Closes Licensing Transaction with Acoustic Core
-------------------------------------------------------------
Eurotech, Ltd., (AMEX:EUO) and Markland Technologies, Inc.,
(OTC:MKLD) have closed their previously announced transaction
pursuant to which Eurotech has agreed to license all of its
rights to the Acoustic Core(TM) technology relating to illicit
materials detection and exchange all rights related to certain
cryptology technology held by Eurotech's subsidiary, Crypto.com,
Inc., for 239,927,344 shares of the outstanding common shares of
Markland, representing approximately 80% of the outstanding
common shares at the time of closing.

The closing of the transaction is the first in what Eurotech
expects will be a series of transactions aimed at better
positioning Eurotech's portfolio of technologies for financing
and commercialization.

The transaction enables Markland to pursue a series of related,
revenue generating opportunities aimed at servicing the growing
Homeland Security market. On December 10, 2002, Markland
announced the acquisition of a government contract to provide
border security logistic support and product development
services to the United States Immigration and Naturalization
Service and Customs Service.

Markland obtained the United States General Services
Administration contract as part of its acquisition of Ergo
Systems Inc., a privately-held corporation located in Virginia.

The companies had previously announced that the rights to the
Acoustic Core(TM) technology would be transferred to Markland,
but have subsequently agreed that Markland instead will be
granted a worldwide, exclusive and perpetual license to such
technology.

Eurotech also announced that it executed a definitive agreement
to effect the previously announced surrender by Woodward LLC of
Woodward's rights to receive approximately $5.7 million of
Eurotech's Series B 5% cumulative convertible preferred stock in
exchange for a security interest in the shares of Markland being
acquired by Eurotech and 50% of the proceeds generated from
future sales by Eurotech of these same shares.

Such security interest is subject to the qualifications and
limitations previously disclosed by Eurotech.

Details of these transactions are or will be available in
Eurotech's and Markland's filings with the Securities and
Exchange Commission.

Eurotech also announced that Mr. Simon Nemzow resigned from the
company's board of directors due to health concerns and family
commitments effective November 15, 2002, as reported in a recent
Security and Exchange Commission Form 8K filing.

In addition, Eurotech announced that the consulting agreement
between the Company and EB Associates, LLC, which had been
engaged by the Company on April 29, 2002 to perform certain
financial consulting services for the Company, has expired and
will not be renewed by the mutual consent of the parties.

Eurotech is a corporate asset manager seeking to acquire,
integrate and optimize a diversified portfolio of manufacturing
and service companies in various markets. Our mission is to
build value in our emerging technologies and in the companies we
acquire and own, providing each with the resources it needs to
realize its strategic business potential.

Eurotech's emerging technology business segment develops and
markets chemical and electronic technologies designed for use in
Homeland and Environmental Security. Following the exchange with
Markland, the Homeland Security segment of the business shall be
conducted through Markland.

Eurotech's portfolio of technologically advanced products
includes: (i) proprietary materials created to specifically
solve the serious problems of how nuclear and other hazardous
wastes are cost effectively contained; (ii) advanced performance
materials for use in industrial products such as coatings and
paints; (iii) automatic detection of explosives and illicit
materials though its Markland Technologies subsidiary, and; (iv)
cryptographic systems for secure communications, all of which
can be used in Homeland and Environmental Security.

Prior to the transfer of the Acoustic Core(TM) illicit materials
detection and Crypto.com technologies, Markland had no operating
businesses. Since the announcement of the definitive agreement
with Eurotech, Markland has commenced a program of acquiring
innovative emerging technologies and providing expert services
focused on the protection of personnel, data and infrastructure
assets.

At September 30, 2002, Eurotech's balance sheet shows that total
current liabilities exceeded total current assets by about $2
million.


FIRST UNION: Fitch Affirms Lower-B Ratings on 6 Classes of Notes
----------------------------------------------------------------
Fitch Ratings affirms all classes of First Union National Bank
Commercial Mortgage Trust's series 2000-C1 as follows: $76.8
million class A-1, $480.9 million class A-2, and notional IO
class at 'AAA', $38.8 million class B at 'AA', $34.9 million
class C at 'A', $11.6 million class D at 'A-', $25.2 million
class E at 'BBB', $11.6 million class F at 'BBB-', $29.1 million
class G at 'BB+', $7.8 million class H at 'BB', $3.9 million
class J at 'BB-', $7.8 million class K at 'B+', $5.8 million
class L at 'B' and $8.7 million class M at 'B-'. Fitch does not
rate the $14.4 million class N.

As of the November 2002 distribution date, the transaction's
aggregate principal balance had been reduced by 2% to $757.5
million from $776.3 million at issuance. To date, realized
losses have totaled $1.2 million. Losses pertaining only to the
Heilig Meyers loans have been applied to class Q which is
subordinate to the trust. Any other losses in the transaction
have been applied to class N. Geographic and property type
concentrations are unchanged. The top geographic concentrations
are Florida (15%), California (12%), and Texas (8%). Retail
(36%) and multifamily (33%) are the largest property type
concentrations.

Wachovia Securities, as master servicer, provided year-end 2001
operating statements for 96% of the loans based on unpaid
principal balance. The weighted-average debt service coverage
ratio for those loans has declined slightly to 1.27 times from
1.29x YE 2000 and 1.29x at issuance. Of concern is the fact that
6.6% of the pool reported DSCRs below 1.00x. The top five loans
currently comprise 17% of the transaction and their weighted-
average DSCR was 1.32x, up from 1.28x for YE 2000, and 1.25x at
issuance.

There is currently one real estate owned property (0.2% of the
pool) and one loan (0.3% of the pool) that is 60 days delinquent
in special servicing. The REO property is a vacant freestanding
Heilig Meyer loan located in San Diego, CA, which became REO in
September 2001. The property is under contract, and the sale is
expected to close before year-end. The loss on this property
should be relatively low. The delinquent loan is the Ramona
Industrial Center, located in Rochester, NY. The loan was
recently transferred to the special servicer for having three
delinquent payments within the past 12 months. There are twenty-
four loans (19%) on the master servicer watchlist. Fitch
considers approximately 9.8% of the loans to be of concern.
There is one loan (3%) in the transaction, Hawthorne Works
Shopping Center, located in Cicero, IL, with Kmart exposure. To
date, Kmart has not rejected the lease. The loan is currently on
the master servicer watchlist for DSCR decline due to low
occupancy caused by the Dominick's Grocery store vacating their
space in March 2002. However, the loan is current.

Fitch's analysis focused on the specially serviced loans,
factoring in the anticipated loss of the Heilig Meyer loan, as
well as other loans of concern. Subordination levels remained
sufficient to affirm the ratings. Fitch will continue to monitor
the performance of this transaction, as surveillance is ongoing.


FISHER SCIENTIFIC: S&P Places Low-B Ratings on Watch Positive
-------------------------------------------------------------
Standard & Poor's that it placed its ratings on Fisher
Scientific International Inc., on CreditWatch with positive
implications. The ratings action reflects Fisher's strong
performance in a difficult market environment and the expected
benefits of a planned refinancing.

The company's total debt outstanding is $900 million.

Hampton, New Hampshire-based Fisher Scientific has a well-
established position as a distributor of a wide variety of
supplies and equipment for the scientific and clinical
laboratory communities. Its broad product offering, diverse
customer base, exclusive distribution arrangements with
equipment manufacturers, and agreements with most major domestic
group-purchasing organizations are barriers to entry for new
competitors. The company has only a small presence in the big-
ticket, capital equipment market, and its sales are not strongly
influenced by the capital budget cycles of its public and
private customers.

Sales of consumable products contribute about 80% of the total,
providing a stable base of recurring revenues. In addition, the
company's rapidly growing electronic-commerce business, which
now accounts for 23% of sales, holds the promise of lower
selling costs.

"Although the company continues to operate with a heavy debt
burden, with total debt to capital in excess of 95%, other
credit measures are strengthening, reflecting ongoing operating
improvements," said Standard & Poor's credit analyst David Lugg.

Standard & Poor's estimates that a proposed refinancing of high-
cost debt issued to finance the company's 1998 leveraged buyout
should save at least $10 million of interest expense annually.
If the refinancing is completed as anticipated in early 2003,
Standard & Poor's expects to raise the corporate credit and
senior debt ratings to 'BB' from 'BB-' and subordinated debt
ratings to 'B+' from 'B'.


FOCAL COMMS: Case Summary & Largest Unsecured Creditors
-------------------------------------------------------
Lead Debtor: Focal Communications Corporation
             200 North LaSalle Street
             Chicago, Illinois 60601

Bankruptcy Case No.: 02-13709

Debtor affiliates filing separate chapter 11 petitions:

Entity                                                Case No.
------                                                --------
Focal Communications Corp of California               02-13717
Focal Communications Corporation of Colorado          02-13720
Focal Communications Corporation of Connecticut       02-13722
Focal International Corporation                       02-13723
Focal Communications Corporation of Pennsylvania      02-13724
Focal Communications Corporation of Florida           02-13725
Focal Communications Corporation of Georgia           02-13727
Focal Communications Corporation of Texas             02-13728
Focal Communications Corporation of Illinois          02-13729
Focal Equipment Finance, LLC                          02-13730
Focal Communications Corporation of Massachusetts     02-13731
Focal Communications Corporation of Michigan          02-13732
Focal Fiber Leasing, LLC                              02-13733
Focal Communications Corporation of the Mid-Atlantic  02-13734
Focal Communications Corporation of Washington        02-13735
Focal Communications Corporation of Minnesota         02-13736
Focal Communications Corporation of New York          02-13737
Focal Communications Corporation of Missouri          02-13738
Focal Communications Corporation of New England       02-13739
Focal Communications Corporation of Wisconsin         02-13740
Focal Communications Corporation of New Jersey        02-13741
Focal Communications Corporation of Ohio              02-13742
Focal Communications Corporation of Virginia          02-13743
Focal Telecommunications Corporation                  02-13745

Type of Business: Focal Communications Corporation and other
                  related Debtors are national communicational
                  providers of voice and data services to
                  communications-intensive users in major
                  cities and metropolitan areas in the United
                  States.

Chapter 11 Petition Date: December 19, 2002

Court: District of Delaware

Judge: Kevin J. Carey

Debtors' Counsel: Laura Davis Jones, Esq.
                  Christopher James Lhulier, Esq.
                  Pachulski Stang Ziehl Young & Jones PC
                  919 N. Market Street
                  16th Floor
                  Wilmington, DE 19899
                  Tel: 302-778-6405
                  Fax: 302-652-4400

Total Assets: $561,044,000

Total Debts: $609,353,000

A. Focal Communications' 20 Largest Unsecured Creditors:

Entity                      Nature Of Claim       Claim Amount
------                      ---------------       ------------
BNY Midwest Trust Company   12.125% Senior Unsec. $129,600,000
(as successor to Harris
Trust and Savings Bank) as
Indenture Trustee
209 West Jackson Blvd.,
Suite 700
Chicago, Illinois 60606

BNY Midwest Trust Company   11.875% Senior Unsec. $118,000,000
(as successor to Harris
Trust and Savings Bank) as
Indenture Trustee
Mary Callahan
209 West Jackson Blvd.,
Suite 700
Chicago, Illinois 60606
Tel: 312-827-8546
Fax: 312-827-8542

MFS Te lecom, Inc.          Trade                   $5,779,764
6929 N. Lakewood
MD 5.3-518
Tulsa, OK 74117
Fax: 720-888-5585

MCI Worldcom                Trade                   $3,059,000
PO Box 917418
Orlando, FL 32891
Fax: 601-460-5115

Verizon                     Trade                   $3,000,000
1095 Avenue of the Americas
New York, NY 10036
Attn: Jonathan Smith
Tel: 212-395-0201

UUNET                       Trade                     $683,632
6929 N. Lakewood
Maildrop 5.3-518
Tulsa, OK 574117
Fax: 208-730-74117

AT&T                        Trade                     $547,512
PO Box 79194
Phoenix, AZ 85062
Fax: 847-289-4972

Sprint                      Trade                     $325,413
PO Box 219489
Kansas City, MO 64121
Fax: 252-641-9096

First Transitions           Trade                     $183,000

Sun Microsystems            Trade                     $105,880

Intrado                     Trade                      $99,621

Infonxx                     Trade                      $99,773

Norlight Telecommunications Trade                      $92,773

Tecnet, Inc.                Trade                      $84,725

Zhone Technologies          Trade                      $26,106

Winstar                     Trade                      $22,686

Broadmargin, Inc.           Trade                      $17,250

Swidler Berlin Shereff      Trade                      $16,227
Friedman, LLP

Harte-Hanks Market          Trade                      $16,227
Intelligence, Inc.

Sher & Blackwell            Trade                      $10,000

Pivot Design, Inc.          Trade                       $8,584

CDWCOMPUTE-001              Trade                       $7,240

B. Focal Comms California's 20 Largest Unsecured Creditors:

Entity                      Nature Of Claim       Claim Amount
------                      ---------------       ------------
Pacific Bell                Trade                     $420,651
Payment Center
Van Nuys, CA 91388-0001
Fax: 217-522-0630

AT&T                        Trade                     $142,432

MCI Worldcom                Trade                      $80,174

Southern California Edison  Trade                      $80,174
Co.

Kinco Redhill, LLC          Trade                      $58,085

Verizon                     Trade                      $49,617

BGI Holdings II, LLC        Trade                      $16,800

Cranbrook Realty Investment Trade                      $12,545
Fund, LP

Texolutions                 Trade                       $7,169

Allegiance Telecom          Trade                       $6,411

Sprint                      Trade                       $6,288

Manpower                    Trade                       $3,094

RIM Logistics, Ltd.         Trade                         $800

Kastle Systems              Trade                         $726

Ikon Office Solutions       Trade                         $629

Fuel Oil Polishing Co.      Trade                         $516

Commercial Systems          Trade                         $516

Rentokil                    Trade                         $486

Commercial Systems          Trade                         $461

Neustar, Inc.               Trade                         $284

Aramark Refreshment         Trade                         $123
Services

C. Focal Comms Connecticut's Largest Unsecured Creditor:

Entity                      Nature Of Claim       Claim Amount
------                      ---------------       ------------
SNET Carrier Services       Trade                      $26,506

D. Focal Comms Pennsylvania's 20 Largest Unsecured Creditors:

Entity                      Nature Of Claim       Claim Amount
------                      ---------------       ------------
AT&T                        Trade                     $290,712
PO Box 79194
Phoenix, AZ 85062
Fax: 847-289-4972

Adelphia Business           Trade                      $17,019

Conestoga Telephone Company Trade                      $12,966

Commonwealth Tel Co         Trade                      $12,814

Allegiance Telecom          Trade                       $2,955

D&E Communications          Trade                       $2,224

Sure-Way Maintenance        Trade                       $1,385

Burns International Security Trade                      $1,082
Service

MCI WorldCom                Trade                         $881

MGE Ups Systems, Inc.       Trade                         $344

Sprint                      Trade                         $343

Utilech, Inc.               Trade                         $296

Quench, Inc.                Trade                         $241

Palmerton Telephone Co.     Trade                         $235

Neustar, Inc.               Trade                         $177

Innerscapes                 Trade                         $164

Adroc Productions, Inc.     Trade                         $150

Verizon                     Trade                         $134

Artistry in Printing        Trade                         $119

Aramark Refreshment Services Trade                        $104

E. Focal Comms Florida's 11 Largest Unsecured Creditors:

Entity                      Nature Of Claim       Claim Amount
------                      ---------------       ------------
BellSouth Pro Cabs          Trade                     $174,645

FPL Fibernett, LLC          Trade                      $38,145

MCI WorldCom                Trade                       $4,620

Taylor & Mathis, Inc.       Trade                       $1,227

Purchase Power              Trade                         $663

ITS Telecommunications      Trade                         $494

Adelphia Business           Trade                         $160
Solutions

Sprint                      Trade                         $128

Nortel Networks, Inc.       Trade                          $57

Allegiance Telecom          Trade                          $51

Neustar, Inc.               Trade                          $16

F. Focal Comms Georgia's 14 Largest Unsecured Creditors:

Entity                      Nature Of Claim       Claim Amount
------                      ---------------       ------------
Bellsouth Pro Cabs          Trade                     $294,953
PO Box 105373
Atlanta, Georgia 30348
Fax: 205-682-2724

Alltel                      Trade                      $62,321
PO Box 60549
St. Louis, MO 63160

AT&T                        Trade                      $20,180

Sunbelt Power               Trade                       $2,744

Blue Ridge Telephone Co.    Trade                       $2,528

RIM Logistics, Ltd.         Trade                       $1,425

Lecstar Communications      Trade                         $751

Waverly Hall Telephone, LLC Trade                         $615

MCI WorldCom                Trade                         $444

Sprint                      Trade                         $433

Nelson-Ball Ground          Trade                         $361

Allegiance Telecom          Trade                         $198

Rentokil                    Trade                         $112

Adelphia Business Solutions Trade                         $110

G. Focal Comms Texas' 20 Largest Unsecured Creditors:

Entity                      Nature Of Claim       Claim Amount
------                      ---------------       ------------
Southwestern Bell           Trade                     $339,303
PO Box 650502
Dallas, TX 75265
Fax: 217-522-0630

Verizon                     Trade                     $142,067

AT&T                        Trade                      $45,908

TrizecHahn Colony Square GP Trade                      $29,263
LLC

Sprint                      Trade                      $13,306

Valor Telecommunications    Trade                       $9,503

Infomart Dallas             Trade                       $7,082

Alltel                      Trade                       $5,187

Sugar Land Tel Co           Trade                       $4,098

Looking Glass Networksm Inc. Trade                      $1,872

Bud Griffin Customer Support Trade                      $1,872
Inc.

Allegiance Telecom          Trade                       $1,433

Brazoria Telephone Co.      Trade                       $1,161

MCI Wordlcom                Trade                       $1,094

Tele Pro Communications,    Trade                         $920
Inc.

Dependable Cleaning         Trade                         $704

Adelphia Business Solutions Trade                          $59

Tecnet, Inc,                Trade                          $30

Blossom Telephone Co.       Trade                          $15

Livingstone Telephone       Trade                           $2

H. Focal Comms Illinois' 20 Largest Unsecured Creditors:

Entity                      Nature Of Claim       Claim Amount
------                      ---------------       ------------
AT&T                         Trade                    $104,103

Ameritech                    Trade                     $81,749

Allegiance Telecom           Trade                     $30,339

Neustar, Inc.                Trade                     $26,397

MCI WorldCom                 Trade                     $10,430

Therm Flo, Inc.              Trade                      $9,648

SMS/800 Management Team      Trade                      $8,875

GKC Total Solutions          Trade                      $6,325

Simplex Grinnell             Trade                      $5,123

Covad                        Trade                      $4,745

Sprint                       Trade                      $4,112

Data Center Design           Trade                      $2,174

TDS Metrocom          Trade                             $1,997

Signature Electric           Trade                      $1,516
Company

Genesys Conferencing         Trade                      $1,077

Adelphia Business Solutions  Trade                        $257

InfoRamp, Inc.               Trade                        $249

Oak Brook Mechanical         Trade                        $180
Services, Inc.

Tecnet                       Trade                        $158

I. Focal Equipment Finance, LLC' 20 Largest Unsec. Creditors:

Entity                      Nature Of Claim       Claim Amount
------                      ---------------       ------------
Nortel Networks, Inc.       Trade                   $1,959,142
3985 Collection Center Drive
Chicago, IL 60693
Fax: 972-684-3666

Fujitsu Network Comm         Trade                    $169,208

Advanced Switching Corp.     Trade                    $134,395

Data Center Design           Trade                    $106,088

Cisco Systems                Trade                     $87,645

Walker and Associates, Inc.  Trade                     $67,074

Peco II, Inc.                Trade                     $30,529

Zhone Technologies           Trade                     $24,756

Vic Electric                 Trade                     $21,575

Savvion, Inc.                Trade                     $19,280

TAC Americus Inc.            Trade                     $15,843

Connection Concepts, Inc.    Trade                      $9,719

Computer Floors Inc.         Trade                      $8,920

Tasman Networks              Trade                      $7,998

Dimension Data               Trade                      $6,792

Netopia, Inc.                Trade                      $4,950

Sterling Commerce, Inc.      Trade                      $4,732

CES International            Trade                      $2,320

Sasco Electric               Trade                      $2,260

Solar Systems & Peripherals, Trade                      $2,250
Inc.

J. Focal Comms Massachusetts' 7 Largest Unsecured Creditors:

Entity                      Nature Of Claim       Claim Amount
------                      ---------------       ------------
260 Franklin Inc.           Trade                     $106,724

AT&T                        Trade                      $60,560

Verizon                     Trade                       $1,242

Sprint                      Trade                         $993

MCI WorldCom                Trade                         $824

Allegiance Telecom          Trade                          $90

Adelphia Business Solutions Trade                          $52

K. Focal Comms Michigan' 13 Largest Unsecured Creditors:

Entity                      Nature Of Claim       Claim Amount
------                      ---------------       ------------
AT&T                        Trade                      $38,695

Ameritech                   Trade                       $8,910

MCI WorldCom                Trade                       $2,564

Allegiance Telecom          Trade                       $1,180

TAC Americus Inc.           Trade                         $800

Sprint                      Trade                         $381

Nextel Comms                Trade                         $335

Chicago Laser & Computer    Trade                         $180
Service

Deerfield Farers Telephone  Trade                          $38

Aramark Refreshment Services Trade                         $36

Ogden Telephone Co.         Trade                          $24

TDS Metrocom                Trade                          $12

Lennon                      Trade                           $2

L. Focal Comms Mid-Atlantic's 13 Largest Unsecured Creditors:

Entity                      Nature Of Claim       Claim Amount
------                      ---------------       ------------
AT&T                        Trade                      $60,207

MCI Worldcom                Trade                       $7,085

Arent Fox Kinfner Plotkin   Trade                       $3,180
Kahn PLLC

Looking Glass Networks,     Trade                       $3,180
Inc.

Global Crossing             Trade                       $2,960
Telecommunications

Muzak-Chicago               Trade                       $1,517

R&R Jaitorial, Painting     Trade                         $990
& Bldg. Svc.

Encompass                   Trade                         $905

Rentokil                    Trade                         $140

Allegiance Telecom          Trade                         $111

Artistry in Painting        Trade                          $78

Neustar, Inc.               Trade                          $57

Adelphia Business           Trade                          $35
Solutions

M. Focal Comms Washington's 18 Largest Unsecured Creditors:

Entity                      Nature Of Claim       Claim Amount
------                      ---------------       ------------
Qwest                       Trade                     $344,536
PO Box 1301
Minneapolis, MN 55483
Fax: 801-239-4149

AT&T                        Trade                      $36,250

Electronic Lightwave        Trade                      $26,172

Eastgate Corporate LLC      Trade                      $17,290

Sprint                      Trade                       $9,496

Centurytel of Washington,   Trade                       $6,495
Inc.

Apollo Communications       Trade                       $3,289
International

YCOM Networks               Trade                       $2,056

McDaniel Tel Co             Trade                       $1,371

Open Works                  Trade                         $875

Ampco System Parking        Trade                         $690

Allegiance Telecom          Trade                         $564

Verizon                     Trade                         $360

Marshell Telecom, Inc.      Trade                         $266

MCI WorldCom                Trade                         $264

Hood Canal Telephone Co     Trade                          $91

Tenino Tel Co               Trade                          $63

Waste Management of Seattle Trade                          $30

N. Focal Comms Minnesota's 14 Largest Unsecured Creditors:

Entity                      Nature Of Claim       Claim Amount
------                      ---------------       ------------
Sprint                      Trade                      $28,872

Frontier Comm               Trade                      $26,334

Sherburne County Rural Tel  Trade                       $1,094

Citizens Communications     Trade                         $816

Qwest                       Trade                         $545

MCI WorldCom                Trade                         $531

Scott-Rice Telephone Co.    Trade                         $418

North Star Access           Trade                          $88

Aramark Refreshment         Trade                           $63
Services

Bridge Water Tel Co.        Trade                          $55

Lakedale Telephone Co       Trade                          $55

US Link                     Trade                          $25

Neustar, Inc.               Trade                           $7

Allegiance Telecom          Trade                           $6

O. Focal Comms New York's 17 Largest Unsecured Creditors:

Entity                      Nature Of Claim       Claim Amount
------                      ---------------       ------------
AT&T                        Trade                     $134,015

A D Winston Service Inc.    Trade                      $13,502

Sprint                      Trade                      $12,294

Con Edison Communications   Trade                      $12,294

MCI Wordlcom                Trade                       $3,585

Telephone Man               Trade                       $2,594

Frontier Comm               Trade                       $2,003

Allegiance Telecom          Trade                       $1,924

Building Maintenance        Trade                       $1,416
Service

Verizon                     Trade                       $1,390

Tishman Real Estate         Trade                       $1,342

Collins Building Services   Trade                       $1,083

Simplex Grinnell            Trade                       $1,012

Neustar, Inc.               Trade                         $285

Independence Center         Trade                         $155
Realty LP II

Artistry in Printing        Trade                          $41

Evans Company               Trade                          $12

P. Focal Comms New Jersey's 12 Largest Unsecured Creditors:

Entity                      Nature Of Claim       Claim Amount
------                      ---------------       ------------
Metromedia Fiber Network    Trade                     $279,097
PO Box 7247-6887
Philadelphia, PA 19170
Fax: 914-421-7688

AT&T                        Trade                     $173,371

Adelphia Business           Trade                     $106,064
Solutions

BPD International Bank      Trade                      $19,095

Sprint                      Trade                      $11,622

Manpower                    Trade                       $3,743

MCI WorldCom                Trade                       $2,202

Allegiance Telecom          Trade                       $1,797

Verizon                     Trade                       $1,466

Warwick Valley Tel Co       Trade                         $681

Neustar, Inc.               Trade                         $122

Artistry in Printing        Trade                          $41

O. Focal Comms Ohio's 6 Largest Unsecured Creditors:

Entity                      Nature Of Claim       Claim Amount
------                      ---------------       ------------
Ameritech                   Trade                     $105,868

AT&T                        Trade                       $9,862

Nextel Communications       Trade                         $320

Sprint                      Trade                         $182

Conneaut Telephone Co.      Trade                         $137

Rentokil                    Trade                         $134


FOCAL COMMS: Fitch Drops Senior Unsecured Debt Ratings to D
-----------------------------------------------------------
Fitch Ratings has downgraded Focal Communications' senior
unsecured debt rating to 'D' from 'C' and the senior secured
rating to 'D' from 'C'. The Negative Rating Watch has been
removed.

The rating action is consistent with Focal's announcement that
it has filed a voluntary Chapter 11 bankruptcy petition in order
to facilitate a financial restructuring. The company has
indicated that it has reached agreements with both its senior
bank lenders and senior secured convertible noteholders that
will enable Focal to undergo a reorganization. As part of the
reorganization plan, the company will exchange approximately
$109 million of its senior secured convertible notes into new
common equity and $65 million of redeemable preferred equity,
and it will also be required to prepay $15 million under its
senior secured bank facility.

At the end of the third quarter of 2002, Focal had approximately
$65 million in cash on its balance sheet and $93 million
outstanding on the credit facility. In addition to the senior
secured convertible notes, the company also had approximately
$240 million in senior unsecured notes outstanding and $18
million outstanding under its secured equipment term loan.

DebtTraders reports that Focal Communications Corp.'s 12.125%
bonds due 2008 (FCOM08USR1) are trading between 1 and 3. See
http://www.debttraders.com/price.cfm?dt_sec_ticker=FCOM08USR1
for real-time bond pricing.


GLOBAL CROSSING: Court OKs Settlement Pact with Risk Management
---------------------------------------------------------------
On January 20, 2000, Global Crossing Ltd., and its debtor-
affiliates entered into a Select Account Network Services
Agreement with Risk Management Alternatives, Inc., pursuant to
which, the GX Debtors agreed to provide Risk Management with
network services. Subsequently, a dispute arose between the GX
Debtors and Risk Management with respect to the amount of
accumulated charges and credits for services following the
termination of the Original Services Agreement.

Pursuant to Rule 9019 of the Federal Rules of Bankruptcy
Procedure, the GX Debtors sought and obtained the Court's
approval on a settlement and release agreement with Risk
Management.  The Settlement Agreement provides for:

   -- the settlement of all claims between the GX Debtors and
      Risk Management; and

   -- the parties to enter into the New Services Agreement.

                   The Settlement Agreement

The parties have agreed to a settlement of disputes relating to
the Original Services Agreement and the Interim Period, as set
forth in more detail in the Settlement Agreement dated as of
October 22, 2002.  The salient terms of the Settlement Agreement
are:

   -- After execution of the Settlement Agreement, Risk
      Management will deliver a check to the Debtors for
      $819,310.30;

   -- The Debtors are authorized to endorse and negotiate the
      Check;

   -- As of the Effective Date, the Debtors will credit the
      account of Risk Management $982,918.70, on account of the
      Disputed Charges;

   -- The parties agree that as of the Effective Date, the
      Original Services Agreement will be terminated and
      considered null and void and the New Services Agreement,
      providing for a $6,000,000 net revenue commitment over a
      term no greater than 60 months will become binding and in
      full force, provided, however, the rates and prices set
      forth in the New Services Agreement will become effective
      as of September 24, 2002; and

   -- The parties exchange mutual releases of claims subject
      to the Settlement Agreement. (Global Crossing Bankruptcy
      News, Issue No. 31; Bankruptcy Creditors' Service, Inc.,
      609/392-0900)


GMAC COMM'L: Fitch Rates Four Classes of Notes at Low-B Level
-------------------------------------------------------------
GMAC Commercial Mortgage Securities, Inc., series 2002-C3,
commercial mortgage pass-through certificates are rated by Fitch
Ratings as follows:

     -- $207,716,000 class A-1 'AAA';

     -- $406,440,000 class A-2 'AAA';

     -- $777,414,016 class X * 'AAA';

     -- $29,153,000 class B 'AA';

     -- $11,661,000 class C 'AA-';

     -- $18,463,000 class D 'A';

     -- $11,661,000 class E 'A-';

     -- $9,717,000 class F 'BBB+';

     -- $9,718,000 class G 'BBB';

     -- $9,718,000 class H 'BBB-';

     -- $18,464,000 class J 'BB+';

     -- $8,746,000 class K 'BB';

     -- $5,831,000 class L 'BB-';

     -- $4,859,000 class M 'B+';

     -- $3,887,000 class N 'B';

     -- $2,722,000 class O-1 'B-';

     -- $1,165,000lass O-2 'B-';

     -- $17,493,016 class P 'NR'.

*Interest-only

Class P is not rated by Fitch Ratings. Classes A-1, A-2, B, C, D
and E are offered publicly, while classes X, F, G, H, J, K, L,
M, N, and O, are privately placed pursuant to rule 144A of the
Securities Act of 1933. The certificates represent beneficial
ownership interest in the trust, primary assets of which are 108
fixed-rate loans having an aggregate principal balance of
approximately $777,414,016 as of the cutoff date.


GROUP TELECOM: Conducts Meetings with Creditors to Vote on Plan
---------------------------------------------------------------
GT Group Telecom Services Corp., GT Group Telecom Services
(U.S.A.) Corp., and London Connect Inc., have conducted meetings
of the senior secured creditor and the unsecured creditor
classes under their proposed plan of arrangement. In the senior
secured creditor class, one hundred per cent of the creditors
who cast votes voted in favor of the plan. Ninety-six per cent
of the unsecured creditors voting, representing 97 per cent of
the dollars voting, voted in favor of the plan.

GT Group Telecom Services Corp., GT Group Telecom Services
U.S.A. Corp., and LondonConnect Inc., will seek court sanction
for the plan by the Ontario Superior Court of Justice on
December 23, 2002, and recognition of that order by the U.S.
Bankruptcy Court on January 2, 2003.

Group Telecom is a Canadian independent, facilities-based
telecommunications provider, with a national fibre-optic network
linked by 454,125 strand kilometres of fibre-optics, at
March 31, 2002. Group Telecom's unique backbone architecture is
built with technologies such as Gigabit Ethernet for delivery of
enhanced network performance and Synchronous Optical Network
(SONET) for the highest level of network reliability. Group
Telecom offers next-generation high-speed data, Internet,
application and voice services, delivering enhanced
communication solutions to Canadian businesses. Group Telecom
operates with local offices in 17 markets across nine provinces
in Canada. Group Telecom's national office is in Toronto. For
more information, please visit http://www.gt.ca

GT Group Telecom's 13.250% bonds due 2010 (GTGR10CAR1),
DebtTraders reports, are trading at 6 cents-on-the-dollar. See
http://www.debttraders.com/price.cfm?dt_sec_ticker=GTGR10CAR1
for real-time bond pricing.


HAYES LEMMERZ: Assuming Stelco Blank & Rim Supply Agreement
-----------------------------------------------------------
Hayes Lemmerz International, Inc., and its debtor-affiliates
sought and obtained the Court's authority to assume the Blank
and Rim Supply Agreement with Stelco Inc., and Stelco USA, Inc.,
as amended.

As previously reported, under the Current Blank and Rim Supply
Agreement with Stelco Inc., Grenville R. Day, Esq., at Skadden
Arps Slate Meagher & Flom LLP, in Wilmington, Delaware, told the
Court that Stelco supplies to the Debtors steel blanks and rims.
These blanks and rims are ultimately manufactured by the Debtors
into wheels, which are sold to original equipment vehicle
manufacturers in North America.

The Debtors owe $774,000 to Stelco under the Current Agreement
prior to the Petition Date.  Stelco has filed proofs of claim in
these cases, asserting $1,300,000 in prepetition claims.  The
Debtors believe that they have certain set-offs and
counterclaims against Stelco with respect to certain of the
claims asserted in the Proofs of Claim.

To stabilize the important supply relationship between the
Debtors and Stelco and to resolve certain outstanding claims,
the parties engaged in good faith, arm's-length negotiations
with respect to the various issues under the Current Agreement.
As a result of these negotiations, the parties have reached a
settlement involving the resolution of the various claims,
certain modifications to the Current Agreement, and the
assumption of the Current Agreement, as amended.

The Assumption Agreement provides:

   -- that Stelco will continue to supply blanks and rims to the
      Debtors, and

   -- a release of substantially all of the claims between the
      parties.

The Debtors will pay Stelco the amount of $450,000 in full
settlement of:

   -- all prepetition defaults, amounts and claims Stelco may
      have against the Debtors under the Current Agreement,
      including the claims asserted in Stelco's Proofs of Claim;
      and

   -- all claims, set-offs and counterclaims the Debtors may
      have against Stelco.

The Assumption Agreement also contains mutual releases, which
provide that the Debtors and Stelco will release each other from
certain claims.  These releases will bring finality to the
disputed issues between the parties. (Hayes Lemmerz Bankruptcy
News, Issue No. 22; Bankruptcy Creditors' Service, Inc.,
609/392-0900)


INTEGRATED BUSINESS: Nears Completion of Investor Debt Workout
--------------------------------------------------------------
Integrated Business Systems and Services, Inc., (OTCBB:IBSS.OB)
a national provider of infrastructure, turnkey transaction
processing software, is scheduled to close before month end a
restructuring of its currently outstanding investor debt,
comprising substantially all of the Company's liabilities,
excluding its trade payables.

The restructuring will extend the payout schedule and provide
other modifications under the terms of approximately $655,000 of
short-term convertible debt and approximately $2.6 million of
long-term convertible debt. The announcement of this
restructuring follows the recent announcement by the Company of
a profitable third quarter and sustained positive cash flows
from operations.

"The restructuring of our outstanding investor debt will greatly
strengthen our balance sheet without unduly limiting our cash
flow for the coming year. The restructured debt will provide us
with the breathing room necessary to continue our quarter-to-
quarter positive cash flows from operations, while also allowing
us to execute our strategic growth plans in 2003. We believe
this refinancing demonstrates the recognition by our investors
of the tremendous structural and operational improvements the
Company has experienced during the past twelve months," said Dr.
George Mendenhall, Chairman and Chief Executive Officer of IBSS.

All of the restructured debt will remain convertible into
equity. During 2002, holders of approximately $658,000 of the
Company's debt converted principal and accrued interest of their
debt into equity. The Company expects additional debt
conversions to occur during 2003.

                    Two New Board Members

IBSS also announced that Dollie A. Cole and Richard D. Pulford
have recently joined the Company's Board of Directors.

Dr. Cole is chairman of the Dollie Cole Corporation, a venture
capital and industrial consulting firm, and has been involved
for many years in the leadership of several business, charitable
and civic organizations. She serves on the Board of Directors of
HPSC, Inc. (AMEX:HDR), a leading national provider of capital to
healthcare professionals, and serves as a consultant to the
Solar and Electric 500 Company. In addition to these business
activities, Dr. Cole also serves as Vice Chairman of the
Smithsonian Institution's National Air and Space Museum,
Chairman of the National Corvette Museum, and serves or has
served on the boards of Project HOPE, the World Health
Organization, the National Captioning Institute for the Hearing
Impaired, the President's Circle of the National Academy of
Science, the President's Club of the University of Michigan,
Michigan State Chancellor's Club - Oakland University, and the
Myer Prentess Cancer Foundation.

Mr. Pulford currently serves as President of Corporate
Strategies, Inc., founded and incorporated in 1981 by
Mr. Pulford, to provide investment banking services in the Great
Lakes region. Until 1987, CSI's primary focus was in brokering
the purchase or sale of automotive production suppliers to
include transaction negotiations and financing. Since 1988, the
CSI's concentration has been primarily in the technology arena.
Under Mr. Pulford's direction, CSI has been a contributor in
equity capital fund-raising endeavors for technology start-up
companies.  Mr. Pulford also operates in a sales consultant
capacity in the automotive industry for a variety of technology
companies, and has provided such services in the past for IBSS.
Prior to forming CSI, Mr. Pulford owned and operated a
consulting practice specializing in financing acquisition
transactions for operating companies.  Mr. Pulford also held
positions in the marketing field after receiving his Masters of
Business Administration in finance.

In announcing the addition of the two new board members, Dr.
Mendenhall stated, "IBSS has continued to receive a positive
response from our customers during various phases of our product
implementation. With the addition of Dr. Cole and Mr. Pulford to
our Board, we believe IBSS is poised to take advantage of even
greater opportunities in the marketplace. Combined with the
success we have achieved over the past year in streamlining our
operations and controlling costs, we anticipate being able to
more effectively achieve our revenue goals for 2003. As new
members of our Board, Dr. Cole and Mr. Pulford should be able to
play an integral part in this important growth stage of our
company."

IBSS is a national software provider of quick payback solutions
to complex, industry-specific information problems. The
Company's flagship product, Synapse, is targeted to be the
preferred architecture for dynamic, distributed, real-time
software applications. The ease and speed of Synapse
installation, its low maintenance and enormous versatility give
Synapse users a true competitive advantage. The Synapse suite of
products includes Synapse for Manufacturing, designed to
maximize flexibility in implementing site-specific manufacturing
solutions at the lowest possible cost and time-to-benefit;
Synapse EAI+ for enterprise modeling and application integration
in highly dynamic environments; and Synapse ASP for flexible,
highly scalable ASP enablement. For more information about IBSS'
technology and services, visit http://www.ibss.com

Integrated Business Systems' September 30, 2002 balance sheet
shows a working capital deficit of about $2 million, and a total
shareholders' equity deficit of about $3.7 million.


INTEGRATED TELECOM: Secures Okay to Sign-Up PwC as Accountants
--------------------------------------------------------------
Integrated Telecom Express, Inc., sought and obtained permission
from the U.S. Bankruptcy Court for the District of Delaware to
engage PricewaterhouseCoopers LLP as its accountants, auditors
and tax advisors.

The Debtor is familiar with the professional standing and
reputation of PricewaterhouseCoopers.  The Debtor understands
that PricewaterhouseCoopers has a wealth of experience in
providing accounting, tax and financial advisory services in
restructurings and reorganizations and enjoys an excellent
reputation for services it has rendered in large and complex
chapter 11 cases.

PricewaterhouseCoopers will provide:

Accounting and Auditing Services, including:

  a) Audits of the financial statements of the Debtor as may be
     required from time to time, and advice and assistance in
     the preparation and filing of financial statements and
     disclosure documents required by the Securities and
     Exchange Commission including Forms 10-K as required by
     applicable law or as requested by the Debtor;

  b) Review of the unaudited quarterly financial statements of
     the Debtor as required by applicable law or as requested by
     the Debtor; and

  c) Performance of other related accounting services for the
     Debtor as may be necessary or desirable.

Tax Services, including:

  a) Review of and assistance in the preparation and filing of
     any tax returns;

  b) Advice and assistance regarding tax planning issues,
     including calculating net operating loss carry forwards and
     the tax consequences of any proposed plans of liquidation,
     and assistance in the preparation of any Internal Revenue
     Service ruling requests regarding the fixture tax
     consequences of alternative reorganization structures;

  c) Assistance regarding existing and future IRS examinations;
     and

  d) Any and all other tax assistance as may be requested from
     time to time.

PricewaterhouseCoopers will bill for services at its customary
hourly rates:

          Partners                            $490-595
          Managers/Directors                  $325-480
          Associates / Senior Associates      $150-325
          Administration / Paraprofessionals  $ 75-140

Integrated Telecom Express, Inc., provides integrated circuit
and software products to the broadband access communications
equipment industry. The Company filed for chapter 11 protection
on October 8, 2002. When the Debtor filed for protection from
its creditors, it listed $115,969,000 in total assets and
$4,321,000 in total debts.


JUNIPER CBO: S&P Affirms Junk Ratings on Classes A-3A & A-3B
------------------------------------------------------------
Standard & Poor's Ratings Services lowered its rating on the
class A-2 notes issued by Juniper CBO 1999-1 Ltd., and co-issued
by Juniper CBO 1999-1 (Delaware) Corp., and removed it from
CreditWatch with negative implications where it was placed
on June 19, 2002. At the same time, the 'AAA' rating on the
class A-1L notes, the 'A+' rating on the class A-1 notes, and
the 'CCC-' rating on the class A-3A and A-3B notes are affirmed.

The lowered rating reflects the par erosion of the collateral
pool securing the rated notes as well as the downward migration
in the credit quality of the assets within the pool.

The affirmations reflect the sufficient level of credit
enhancement currently available to support these rated tranches.

The overcollateralization ratio tests for Juniper CBO 1999-1
Ltd. continue to be out of compliance, and there has been
significant deterioration in the ratios in recent months. As of
the December 2, 2002 monthly trustee report, the class A
overcollateralization ratio was 92.8% (the required minimum
ratio is 115%) versus 102.4% at the time of the last downgrade.
The class B overcollateralization ratio was 80.6% (the required
minimum ratio is 104%) versus 90.9% at the time of the last
downgrade.

The credit quality of the collateral pool has also deteriorated
in recent months. Currently, $72.754 million (or approximately
18.65% of the collateral pool) has defaulted. In addition,
$14.605 million (or approximately 4.60%) of the performing
assets in the collateral pool come from obligors with Standard &
Poor's ratings currently in the 'CCC' range; a total of $9.5
million (or approximately 2.99%) of the performing assets in the
collateral pool come from obligors with Standard & Poor's
ratings currently in the 'CC' range; and $25.102 million (or
approximately 7.91%) of the performing assets within the
collateral pool come from obligors with Standard & Poor's long-
term corporate credit ratings on CreditWatch negative.

Standard & Poor's has reviewed current cash flow runs generated
for Juniper CBO 1999-1 Ltd. to determine the future defaults the
transaction can withstand under various stressed default timing
scenarios while still paying all of the rated interest and
principal due on the class A-1L, A-1, A-2, A-3A, and A-3B notes.
Upon comparing the results of these cash flow runs with the
projected default performance of the current collateral pool,
Standard & Poor's has determined that the rating previously
assigned to the class A-2 notes was no longer consistent with
the credit enhancement currently available; hence, the lowered
rating. Standard & Poor's will continue to monitor the
performance of the transaction to ensure that the ratings
assigned to the rated notes remain consistent with the credit
enhancement available.

      Rating Lowered And Removed From Creditwatch Negative

                  Juniper CBO 1999-1 Ltd.

     Class       Rating                    Balance (Mil. $)
              To        From               Orig.    Current
     A-2      BBB-      BBB+/Watch Neg     34.000   34.000

                       Ratings Affirmed

                  Juniper CBO 1999-1 Ltd.

                              Balance (Mil. $)
          Class   Rating    Orig.       Current
          A-1L    AAA       147.000     98.511
          A-1     A+        134.000     134.000
          A-3A    CCC-      60.000      60.000
          A-3B    CCC-      40.000      40.000


KAISER ALUMINUM: Inks Pact to Sell Tacoma, WA Property for $12MM
----------------------------------------------------------------
Kaiser Aluminum entered into a definitive agreement to sell its
property, plant, and equipment located in Tacoma, Washington, to
the Port of Tacoma for initial net cash proceeds of $12.1
million. The Port also will place approximately $4.0 million in
escrow for future expenditures to meet certain regulatory
requirements related to preparing the real estate for future
use. Any portion of the escrowed funds not required to meet such
requirements will be paid to Kaiser as additional proceeds of
the sale.

"The transaction is part of Kaiser's ongoing objective to sell
non-core assets and to bolster our already strong liquidity,"
said Kaiser President and Chief Executive Officer Jack A.
Hockema.

"The Tacoma smelter has generated significant economic value
locally and regionally for more than 60 years. It is especially
gratifying to have found a buyer for this property who intends
to develop it in a manner that will provide ongoing economic
benefit. In particular, the Port of Tacoma has a number of
critical infrastructure and marine terminal expansion projects
underway - and we understand that this transaction represents
another element in the Port's long-term strategic plan," said
Hockema.

"The aluminum industry in which Tacoma thrived for so long has
changed and, clearly, so has the Northwest power environment,"
said Hockema. "After much study, we concluded that Tacoma simply
cannot compete with the much larger, newer, and more efficient
smelters - generally located outside the United States - that
dominate the world market today. We salute the many employees,
customers, suppliers, and others who shared in Tacoma's rich
history."

According to Jack Fabulich, President of the Port of Tacoma
Commission, the purchase is a continuation of the Port's
commitment to investing in the community. "Strategic
acquisitions like this are essential to expanding the
capabilities of the Port, which bolsters the regional economy
and produces jobs for Pierce County."

The transaction includes about 96 acres and related structures
located approximately four miles east of downtown Tacoma in the
Tideflats industrial area, adjacent to the Blair Waterway, which
the Port is re-developing for container terminal use. The
agreement is subject to approval by the U.S. Bankruptcy Court
for the District of Delaware. Subject to such approval, Kaiser
expects to close the transaction in the first quarter of 2003.

The Tacoma facility has been fully curtailed since mid-2000. At
full operation, the facility had about 350 employees and was
capable of producing about 73,000 metric tonnes of aluminum
annually. Most of these employees are eligible to receive - or
already have elected to receive -- retirement benefits under the
terms of the Salaried Employees Retirement Plan or under the
terms of a labor agreement with the United Steelworkers of
America.

Under the terms of the transaction, the Port of Tacoma will
assume responsibility for any necessary demolition and
environmental remediation that may be required as it develops or
otherwise maintains the property.

The status of Kaiser's Mead, Washington, aluminum smelter is
unchanged. It remains curtailed due to a combination of low
aluminum prices and unattractive power prices. As previously
disclosed in the company's third-quarter 10-Q, Kaiser continues
to assess how to optimize the value of Mead.

The Port of Tacoma's stated mission is to create sound regional
economic growth through maritime commerce and related
development. Established in 1918, the Port today ranks among the
largest containerized cargo handlers in the nation. The Port
contributes to $471 million in annual wages in Pierce County
while generating more than $77 million each year in state and
local taxes. For more information, visit the Port of Tacoma on
the Internet at http://www.portoftacoma.com

Kaiser Aluminum Corporation (OTCBB: KLUCQ) is a leading producer
of alumina, primary aluminum, and fabricated aluminum products.

DebtTraders says that Kaiser Aluminum & Chemicals' 12.750% bonds
due 2003 (KLU03USR1) are trading between 9.5 and 11.5. See
http://www.debttraders.com/price.cfm?dt_sec_ticker=KLU03USR1for
real-time bond pricing.


KENTUCKY ELECTRIC: Lenders Snub Two Refinancing Proposals
---------------------------------------------------------
As previously announced, Kentucky Electric Steel, Inc.,
(NASDAQ:KESI) was required, on or before December 16, 2002, to
provide the note holders and lenders under the revolving credit
facility proposals that would enable the Company to repay the
notes and the revolver in full. The Company submitted two
refinancing proposals to its lenders on December 13, 2002. The
Company has been informed that neither of these proposals is
acceptable to its current lenders and that the lenders consider
the Company in default on its Senior Notes and Revolving Credit
Agreement. The Company continues to work with its lenders to
address its financing needs.

Kentucky Electric Steel, Inc., is a publicly held company which
operates a specialty steel mini-mill, manufacturing special
quality steel bar flats for the leaf-spring suspension, cold
drawn bar conversion, truck trailer support beam, and steel
service center markets. Kentucky Electric Steel, Inc.'s common
stock (symbol: KESI) is traded on the NASDAQ Small Cap Market.


KMART CORP: Court Approves Compromise Agreement with IRS
--------------------------------------------------------
Kmart Corporation and its debtor-affiliates sought and obtained
approval from the U.S. Bankruptcy Court for the Northern
District of Illinois for a Compromise Agreement with the
Internal Revenue Services.

Pursuant to the Compromise Agreement, the IRS:

  (i) agrees to pay to the Debtors a $6,500,000 tax refund
      plus applicable interest and reconciling amounts;

(ii) is entitled to offset certain corporate income tax
      deficiencies owed by the Kmart Group for the taxable years
      ending January 1986, January 1988, January 1992, and
      January 1999 against corporate income tax refunds owed to
      the Kmart Group for the taxable years ending January 1993
      through January 1995 and January 1997 in the
      implementation of the Net Tax Refund; and

(iii) is further entitled to offset certain excise tax
      deficiencies or underpayment interest for the taxable
      periods ending December 31, 1997, December 31, 1998, and
      December 31, 2001 against excise tax refunds or
      Overpayment interest owed to the Kmart Group for the
      taxable periods ending March 31, 1997, June 30, 1997,
      September 30, 1997, March 31, 1998, June 30, 1998 and
      September 30, 1998 and, to the extent of the excess
      deficiency of $98,841 against the corporate income tax
      refunds owed to Kmart.

John Wm. Butler, Esq., at Skadden, Arps, Slate, Meagher & Flom,
relates that the parties are still trying to reach an agreement:

   -- on the interest computations for each of the income tax
      overpayments and underpayments at issue for taxable years
      ending January 1986 through January 1999; and

   -- resolving any related outstanding issues, including the
      proper application of the interest netting provisions of
      Section 6621(d) of the Internal Revenue Code of 1986, as
      amended.

Nonetheless, the parties agree that the Net Tax Refund due to
Kmart is at least $6,500,000 and may be increased up to an
additional $1,500,000 pursuant to the interest computation as
finally agreed to by the parties.

Mr. Butler explains that Kmart is the common parent of an
affiliated group of corporations -- the Kmart Group -- within
the meaning of IRC Section 1504 that files a consolidated
federal income tax return.  The IRS has audited the Kmart
Group's consolidated federal income tax returns for the taxable
years ending January 1986 through January 1999.  Consequently,
the IRS determined that for certain taxable years the Kmart
Group made underpayments or overpayments of corporate income
tax, resulting in a net refund of $14,476,701 plus applicable
interest owing to Kmart as of January 22, 2002:

               Taxable Year   Tax Underpayment
                  Ending      (or Overpayment)
               ------------   ----------------
                  1/1986             $2,985
                  1/1987                  0
                  1/1988            109,293
                  1/1989                  0
                  1/1990                  0
                  1/1991                  0
                  1/1992         (1,419,047)
                  1/1993         (5,776,784)
                  1/1994         (6,081,564)
                  1/1995         (1,142,697)
                  1/1996                  0
                  1/1997           (671,226)
                  1/1998                  0
                  1/1999            502,339
                              ----------------
           Net Overpayment     ($14,476,701)

The IRS also determined that for certain taxable periods, the
Kmart Group made underpayments or overpayments of excise tax or
interest, resulting in a net tax deficiency plus interest equal
to $98,841 owed by the Kmart Group as of January 22, 2002:

               Taxable Year   Tax Underpayment
                  Ending      (or Overpayment)
               ------------   ----------------
                 3/31/1997        ($176,607)
                 6/30/1997          (86,790)
                 9/30/1997             (121)
                12/31/1997          166,983
                 3/31/1998          (26,616)
                 6/30/1998          (28,071)
                 9/30/1998           (9,569)
                12/31/1998           61,917
                12/31/2001          197,715
                              ----------------
           Net Underpayment         $98,841

On September 29, 2000, Kmart received $7,581,163 -- interest
included -- from the IRS as payment against any taxes and
interest due to Kmart as of that date.

Mr. Butler contends that Compromise Agreement should be approved
since all the prerequisites for set-off under applicable non-
bankruptcy law are present:

   (1) the IRS has claims against Kmart for certain prepetition
       income tax deficiencies;

   (2) the IRS owes Kmart debts for prepetition income tax
       overpayments that Kmart made;

   (3) mutuality exists where the IRS is attempting to set off
       its liability to the taxpayer by the amount the taxpayer
       owes the IRS; and

   (4) both debts are prepetition. (Kmart Bankruptcy News, Issue
       No. 39; Bankruptcy Creditors' Service, Inc., 609/392-
       0900)


KMART CORP: Shares Trade on Pink Sheets Under New Ticker Symbols
----------------------------------------------------------------
Kmart Corporation announced that the over-the-counter bulletin
board has assigned the new ticker symbols "KMRTQ" to its common
stock and "KMTPQ" to the trust preferred securities of Kmart
Corporation's subsidiary, Kmart Financing I. Effective Thursday,
Dec. 19, 2002, the common stock and the trust preferred
securities will be quoted on the Pink Sheets Electronic
Quotation Service; information regarding such service is
available at http://www.pinksheets.com The OTCBB has indicated
that quotation of the common stock and the trust preferred
securities on the OTCBB will be delayed in light of the
Company's previously announced restatement of its financial
statements. The Company expects such securities to be eligible
for quotation on the OTCBB no later than completion of the
restatement.

As previously announced, the New York Stock Exchange has
indicated that it will suspend trading of Kmart's common stock
and the trust convertible preferred securities effective today,
and that it has initiated proceedings to delist the securities.

Kmart Corporation is a mass merchandising company that serves
America with more than 1,800 Kmart and Kmart SuperCenter retail
outlets. Kmart in 2001 had sales of $36 billion.


LAIDLAW INC: Reports Improved Operating Results for Fiscal 2002
---------------------------------------------------------------
Laidlaw Inc., announced unaudited operating financial results
for the fiscal year ended August 31, 2002. The Company expects
to release audited financials early in the new year. "The Plan
of Reorganization requires that we prepare financial statements
in accordance with both Canadian and US GAAP," said Kevin
Benson, President and CEO. "There are a number of recent
financial reporting changes required by US GAAP that are
applicable to Laidlaw in this fiscal year. These are delaying
the completion of the audited statements but will not affect the
operating results for the year. We are releasing these results
to provide stakeholders with this information as quickly as
possible."

                    Consolidated Revenue

For the fiscal year ended August 31, 2002, consolidated revenue
from the Company's Contract Bus Services, Greyhound and
Healthcare Services segments increased marginally to $4.43
billion from the $4.42 billion reported in fiscal 2001.

                     Operating Earnings

Consolidated earnings, before interest, taxes, depreciation and
amortization (EBITDA) and before goodwill impairment charges,
were $421 million compared with $383 million for fiscal 2001.

On September 24, 2002, the Company filed a Second Amended Joint
Plan of Reorganization with the United States Bankruptcy Court.
The projected consolidated statements of operations contained in
the plan anticipated EBITDA of $500 million for the fiscal 2002
period. However, a subsequent review of the actuarial cost
projections for current-year and maturing prior-year accident
claims indicated a negative trend in settlement amounts. The
Company accordingly decided to increase its reserve estimates,
primarily relating to incidents which occurred in prior years.
This change resulted in an additional charge to earnings of $60
million.

Further charges totaling $9 million were taken to provide for
losses resulting from the insolvency of PHICO Insurance Company,
from which EmCare had purchased malpractice insurance, and from
the write off of Greyhound's investment in Golden State, which
recently filed for bankruptcy protection. "In the course of
conducting the year-end review of our operations, we felt it was
prudent to provide for these losses as well as a number of other
smaller items that came to light. I believe that these will not
repeat in subsequent years," said Benson.

                  Resolution of PBGC Issues

In recent weeks the Company has been in discussion with the
Pension Benefit Guaranty Corporation, a United States government
corporation that administers the mandatory termination insurance
program for defined benefit pension plans under the Employee
Retirement Income Security Act. These discussions centred on the
claims asserted by the PBGC against the Company in the U.S.
bankruptcy proceedings regarding funding of the Greyhound U.S.
Plans. The Company and the PBGC have orally agreed to resolve
the claims of the PBGC, subject to negotiation and execution of
a definitive agreement. The terms of this agreement, in essence,
provide for the Company to contribute an aggregate amount of
$150 million to such Greyhound U.S. Plans, in excess of minimum
contributions. This amount will be contributed as follows:

     - $50 million in cash on exit from bankruptcy protection,

     - $50 million in cash in June 2004,

     - $50 million from the sale of Laidlaw stock placed in
       trust upon exit from bankruptcy and sold over the period
       to December 30, 2004.

The Company anticipates that, with the completion of this
agreement, it will emerge from bankruptcy protection by
March 31, 2003.

                    Segmented Results

The Company's Contract Bus Services segment comprises school bus
and municipal transit operations. Revenue for the current year
of $1.79 billion was virtually the same as the $1.77 billion
achieved in 2001. EBITDA, before goodwill impairment charges,
was $271 million compared with $270 million last year.

Revenue from Greyhound decreased 2.5% to $1.22 billion from
$1.25 billion in fiscal 2001. EBITDA, before goodwill impairment
charges, was $54 million compared with the $85 million reported
for fiscal 2001.

The Company's Healthcare Services segment comprises ambulance
services and emergency management services. Revenue for the
current year increased 2.2% to $1.42 billion from $1.39 billion
in fiscal 2001. EBITDA, before goodwill impairment charges, was
$96 million compared with the $28 million reported for fiscal
2001.

The revenue increase in Contract Bus Services is attributable to
contract price increases and additional routes, which offset
lost contracts. Decreased revenue at Greyhound results primarily
from the combined effects of lower ridership attributable to
travelers' continuing security concerns, partly offset by price
increases. The Healthcare Services' revenue increase is
primarily due to an increase in revenue per transport, the
renegotiation of a significant ambulance service contract and
the sale of previously written-off emergency management services
receivables. These increases were partly offset by the exit from
several unprofitable ambulance service contracts.

At Greyhound, reduced ridership, an increase in the proportion
of lower-margin, long-haul tickets sold, increased security
costs and the write-off of its investment in Golden State,
combined to reduce EBITDA.

Healthcare Services EBITDA increased as a result of an
improvement in revenue per transport and a reduction in both
accident claims and government audit settlements. These
improvements were partially offset by increases in physician and
paramedic compensation and increases in professional liability
insurance costs in emergency department management.

"2002 has been a challenging year for Laidlaw," said Benson.
"The extensive publicity around the Company's financial problems
and the time required for the completion of the Plan of
Reorganization, have detracted from the overall strategic focus
of the Company. We look forward to emerging from protection in
the first quarter of next year and to the opportunity to
demonstrate the underlying strength of our core operations."

Laidlaw Inc., is a holding company for North America's largest
providers of school and intercity bus transportation, public
transit, patient transportation and emergency management
services.


LUCENT: Maryann Niebojeski Returns to Head Investor Relations
-------------------------------------------------------------
Lucent Technologies (NYSE: LU) announced that MaryAnn Niebojeski
has returned to the company as vice president of investor
relations.

Ms. Niebojeski will lead the investor relations function at
Lucent and be responsible for communications with shareholders
and financial analysts. Lucent has about 5 million shareholders
and is one of the most widely held stocks in the U.S.

Prior to her retirement in May 1999, Niebojeski had 26 years
with Lucent and AT&T. Niebojeski had created the investor
relations function at the time of Lucent's spin-off from AT&T
and played a critical role in establishing the Lucent brand in
investment capitals around the world.

"We are very fortunate that MaryAnn has decided to return to
Lucent. Her insight, experience and hard work were critical to
the team that led the spin-off from AT&T, and she will be a
crucial leader as we continue our restructuring program," said
Frank D'Amelio, senior vice president and Chief Financial
Officer. "MaryAnn will refine and execute Lucent's global
investor relations strategy and continue to foster key
relationships with our investors and the financial analyst
community."

Niebojeski obtained a bachelor's of science degree from Kent
State University and has attended the executive education
program at Penn State University.

Lucent Technologies, headquartered in Murray Hill, N.J., USA,
designs and delivers networks for the world's largest
communications service providers. Backed by Bell Labs research
and development, Lucent relies on its strengths in mobility,
optical, data and voice networking technologies as well as
software and services to develop next-generation networks. The
company's systems, services and software are designed to help
customers quickly deploy and better manage their networks and
create new, revenue-generating services that help businesses and
consumers. For more information on Lucent Technologies, visit
its Web site at http://www.lucent.com

Lucent Technologies' 7.70% bonds due 2010 (LU10USR1),
DebtTraders says, are trading at about 32 cents-on-the-dollar.
See http://www.debttraders.com/price.cfm?dt_sec_ticker=LU10USR1
for real-time bond pricing.


MARK NUTRITIONALS: Brings-In Bill Wagner as Financial Consultant
----------------------------------------------------------------
Mark Nutritionals, Inc., obtained permission from the U.S.
Bankruptcy Court for the District of Texas to employ Bill Wagner
as its Financial Consultant.

Larry Cochran, the Debtor's C.E.O. has decided to hire a
professional with a strong financial background and experience
consumer product business.

Mr. Wagner is the President of Double B Foods, Inc., and a
Partner with the Firm Tatum CFO Partners.  He is a Certified
Management Accountant, a Certified Financial Planner, and holds
a Masters in Business Administration from the University of
South Carolina.  The Debtor must have an experiences Financial
Consultant to financial advisor to assist it in turnaround
management and financial advisory services.

Mr. Wagner's compensation will be fixed at $8,000 per month. Mr.
Wagner may seek a success fee based on results or monetary
investment, but the Debtors did not promise of that sort at this
time.

Mark Nutritionals, Inc., filed for chapter 11 protection on
September 17, 2002.  William H. Oliver, Esq., at Pipkin, Oliver
& Bradley, LLP represents the Debtor in its restructuring
efforts.  When the Company filed for protection from its
creditors it listed estimated debts of over $10 million.


MAXXIM MEDICAL: S&P Places B- Corp. Credit Rating on Watch Neg.
---------------------------------------------------------------
Standard & Poor's placed the ratings on medical products
supplier Maxxim Medical Group Inc., on CreditWatch with negative
implications.

The corporate credit rating on Waltham, Massachusetts-based
Maxxim is 'B-'.

"The ratings action reflects the possibility that Maxxim may
have difficulties complying with its covenant package if
performance does not improve in the next few months," said
Standard & Poor's credit analyst Jordan Grant.

Maxxim Medical is an important supplier of custom-procedure
trays, nonlatex examination gloves and other single-use
products. However, the company's new management faces an ongoing
challenge to improve the profitability of the operations that it
has acquired through the aggressive use of debt. Cash flow
shortfalls have required financial restructuring. Yet, even
though the issuance of new equity and a revision in the terms of
its credit facilities provided Maxxim with financial flexibility
to meet its principal and interest obligations during 2002,
the company has not yet been able to improve its operating
performance.

Maxxim was able to sell its bio-safety business in October of
2002 for approximately $23 million, which provided additional
funds for debt repayment. However, both revenue and operating
margins have been lower than expected. Unless operations improve
significantly during the next few months, Maxxim is in danger of
violating its bank covenants, which include interest coverage,
total leverage, and senior leverage ratios.

As of December 12, 2002, Maxxim had approximately $2 million in
cash, $3 million available on one of its revolving credit
facilities, and $17 million available on its priority credit
facility. However, Maxxim cannot access all of its available
borrowing capacity without violating covenants. Moreover, Maxxim
has approximately $34 million in interest and amortization
payments coming due in 2003. The company does not currently
produce enough operating cash flow to meet its 2003 obligations.

Standard & Poor's will meet with Maxxim's management to discuss
the company's prospects for amending its covenant package and
improving operating performance.


METRIS COMPANIES: Will Publish Fourth Quarter Results on Jan. 29
----------------------------------------------------------------
Metris Companies Inc., (NYSE:MXT) will announce its 2002 fourth
quarter earnings on Wednesday, January 29, before the market
opens.

Management will host a conference call on January 29 at 11:00
a.m. Eastern Time. The press and public are invited to listen to
a live webcast of the call by registering at
http://www.metriscompanies.com Click on the Investor Relations
icon to participate.

Metris Companies Inc., is one of the nation's leading providers
of financial products and services. The company issues credit
cards through its wholly owned subsidiary, Direct Merchants
Credit Card Bank, N.A., the 10th-largest bankcard issuer in the
United States. As a top-tier enhancement services company,
Metris also offers consumers a comprehensive array of value-
added products, including credit protection and insurance,
extended service plans and membership clubs. For more
information, visit http://www.metriscompanies.comor
http://www.directmerchantsbank.com


METRIS: Fitch Cuts Sr. Debt & Bank Credit Facility Ratings to B-
----------------------------------------------------------------
Fitch Ratings has lowered the senior debt and bank credit
facility ratings of Metris Companies Inc. to 'B-' from from
'B+'. In addition, the long-term deposit rating of Direct
Merchants Credit Card Bank N.A., has been lowered to 'B+' from
'BB'. The short-term deposit rating of DMCCB is unchanged at
'B'. All ratings have been placed on Rating Watch Negative.
Approximately $250 million of senior unsecured debt and $100
million of bank debt are affected by this action.

Fitch's downgrade and Rating Watch status reflect deterioration
in operating performance where higher losses have negatively
impacted earnings and profitability coupled with concerns
regarding ongoing access to the term and conduit asset-backed
securities markets. Metris has a considerable portion of its
conduit facilities that mature in the second quarter of 2003.
Although Metris is actively engaged with various credit
providers to ensure adequate conduit capacity, Fitch believes
the challenges this presents has heightened the risk to the
company. Moreover, Fitch is concerned that Metris will need to
rely on a surety provider to execute any term asset-backed
issuance, which if attainable, is likely to be a more costly
source of financing. Fitch also notes that Metris will need to
repay a $100 million term loan drawn under its bank credit
facility that comes due in July 2003. Repayment of this loan
could be more problematic unless additional financing is
obtained or regulators approve a dividend from the bank to the
holding company.

Fitch remains concerned with Metris' deteriorating operating
performance in the face of difficult economic and industry
conditions. The company's earnings and profitability have been
negatively impacted by higher levels of provisions coupled with
reduced revenues from a smaller portfolio. Furthermore, Fitch
expects that earnings are not likely to recover over the near-
term. Asset quality measures have also deteriorated owing to the
weaker economy and declining portfolio balance. Although Metris
has implemented a number of actions to improve its overall
credit quality, Fitch expects asset quality measures will also
remain pressured over the near to intermediate term.
Importantly, net charge-offs in the Metris Master Trust, the
company's primary securitization vehicle, have increased to
levels that have caused excess spread in the trust to fall below
5.50%, thereby trapping cash in the trust rather than releasing
back to the company. The company needs to maintain minimum
excess spread levels in the MMT under its securitization and
credit facilities, otherwise it may trigger covenant violations
and/or early amortization of securities issued out of the trust.
While excess spread levels are currently above these minimum
requirements, the deterioration in asset quality has eroded the
cushion that has previously existed. Further rating actions will
depend on the company's ability to improve overall operating
performance combined with its ability to secure or renew
additional financing for maturing obligations.

Fitch believes that DMCCB has made satisfactory progress towards
achieving the objectives laid out in the written agreement with
the Office of the Comptroller of the Currency. The company is in
compliance with stated guidance on subprime lending and credit
card account management practices, although the financial impact
of potential regulatory changes to assessing late and overlimit
fees remains uncertain.

Metris Companies Inc, based in Minnetonka, Minnesota, is a
direct marketer of general purpose credit cards and related
enhancement products. At September 30, 2002, Metris reported
managed credit card loans of $11.5 billion and total equity,
including preferred stock of $1.1 billion.

      Ratings Lowered and Placed on Rating Watch Negative

      -- Senior Debt Downgrade to 'B-' from 'B+';

      -- Bank Credit Facility Downgrade to 'B-' from 'B+'

            Direct Merchants Credit Card Bank N.A.

      -- Long term deposits Downgrade to 'B+' from 'BB'.

            Ratings Placed on Rating Watch Negative
             Direct Merchants Credit Card Bank N.A.

      -- Short-term deposits 'B'.


MISSISSIPPI CHEMICAL: Will Padlock Donaldsonville, LA Facility
--------------------------------------------------------------
Mississippi Chemical Corporation (NYSE: GRO) announced
production changes at its Donaldsonville, La., nitrogen complex.
Employees at the urea facility were notified Thursday that this
facility will be permanently shutdown during the first quarter
of calendar 2003. Continued pressure from the natural gas
price/product price relationship and the closure of Melamine
Chemicals, Inc., the facility's largest industrial customer for
urea melt, resulted in continuing losses from this operation.

When this plant is shut down, there will be a reduction in the
workforce of approximately 40 full-time positions. On an
annualized basis, approximately $6.5 million of cash fixed costs
will be eliminated from the Donaldsonville complex. Severance
cost of approximately $1.0 million will be accrued when these
changes occur. Outplacement counseling and a severance package
based on length of service will be provided to the employees.
The Louisiana Works-Department of Labor will also be assisting
affected employees in job opportunities.

The company's Donaldsonville complex has an annual capacity to
produce approximately 1 million tons of ammonia and 578,000 tons
of urea synthesis. A majority of the urea synthesis production
was used to produce approximately 396,000 tons of prilled urea.

Charles O. Dunn, president and chief executive officer, said,
"This environment, which has continued now for several years,
does not lend itself to easy decisions. It is unfortunate that
we are faced with having to make these choices, but we have to
do what is necessary for the continued well-being of the
company. We have always valued our employees highly and will try
to assist them as best we can during their transition. As we
move forward, we will continue to evaluate additional changes at
all of our facilities that will result in a more competitive
company in this challenging environment."

Mississippi Chemical Corporation, through its wholly owned
subsidiaries, produces and markets all three primary crop
nutrients. Nitrogen, phosphorus and potassium-based products are
produced at facilities in Mississippi, Louisiana and New Mexico,
and through a joint venture in The Republic of Trinidad and
Tobago.

As previously reported, Fitch Ratings has affirmed Mississippi
Chemical Corporation's senior secured credit facility at 'CCC+'
and the senior unsecured notes at 'CCC-'. The ratings have been
removed from Rating Watch Negative. The Rating Outlook is
Negative.

DebtTraders reports that Mississippi Chemical's 7.250% bonds due
2017 (GRO17USR1) are trading between 22 and 25. See
http://www.debttraders.com/price.cfm?dt_sec_ticker=GRO17USR1for
real-time bond pricing.


MORGAN STANLEY: Fitch Affirms Low-B Ratings on 6 Note Classes
-------------------------------------------------------------
Morgan Stanley Dean Witter Capital Inc.'s commercial mortgage
pass-through certificates, series 2001-IQ $181.9 million class
A-1, $151.7 million class A-2, $261 million class A-3 and
interest-only classes X-1 and X-2 are affirmed at 'AAA' by Fitch
Ratings. In addition, Fitch affirms $22.3 million class B at
'AA', $18.7 million class C at 'A', $5.3 million class D at 'A-
', $5.3 million class E at 'BBB+', $8.9 million class F at
'BBB', $5.3 million class G at 'BBB-', $5.3 million class H at
'BB+', $10.7 million class J at 'BB', $3.6 million class K at
'BB-', $1.8 million class L at 'B+', $5.3 million class M at 'B'
and $1.8 million class N at 'B-'. Fitch does not rate class O.
The rating affirmations follow Fitch's annual review of the
transaction, which closed in October 2001.

The rating affirmations are the result of stable pool
performance and the lack of collateral paydown resulting in
consistent subordination levels consistent with issuance.

The certificates are collateralized by 91 fixed-rate loans on
111 properties, and consist mainly of the following: retail
(35.3%), office (34%), industrial (16.6%), and multifamily
(8.6%). There are geographic concentrations in California (30%),
Kansas (8.3%), New Jersey (6%) and Virginia (5.4%). As of the
November 2002 distribution date, the pool's collateral balance
has decreased 2.6% to $694.5 million from $713 million at
closing.

CapMark Services, the master servicer, collected year-end 2001
financials for 94.7% of the pool balance. According to the
information provided, the 2001 weighted average debt service
coverage ratio increased to 1.74 times from 1.43x at issuance.

Fitch reviewed the performance of the Fitch credit assessed
loans: Town Center Plaza loan (7.7% of the pool), Turtle Creek
Mall (4.6%) and the Marina Village loan (4.5%). The Town Center
Plaza loan is secured by a fee interest in a 388,962 square foot
anchored retail center located in Leawood, KS (Kansas City). The
collateral is part of a larger center comprising 607,700 sf. The
collateral is currently anchored by Barnes & Noble and Bath &
Body, with a vacant Jacobson's store. Included in the overall
center, but not part of the collateral, are nine outlets
totaling 218,963 sf and two large retail properties: Galyans
Trading Co. and AMC Theaters. Jacobson's, the largest anchor in
the collateral, has liquidated and closed all stores. Despite
the store closing, the performance of the center (both the owned
and non-owned collateral) remains strong. The inline tenants
continue to perform well, despite the vacancy of the anchor. In
addition, the borrower is currently negotiating with potential
tenants who are interested in the anchor space. The DSCR at YE
2001 was 1.60x compared to 1.44x at issuance, using servicer
reported cash flows. Based on the overall performance of the
property and the lack of competition in the area, Fitch
maintains an investment grade credit assessment on this loan.

The Turtle Creek Mall loan is secured by a 388,962 sf regional
mall located in Hattiesburg, Mississippi, midway between the
state capital of Jackson and the Gulf Coast. The DSCR for the YE
2001 was 1.93x compared to 1.63x at issuance. Tenants include
Sears, McRae's Center Court, Dillards and J.C. Penney. The
Marina Village loan is secured by ten office buildings and one
grocery-anchored retail center located in Alameda, California.
The DSCR for the YE 2001 was 1.99x compared to 1.64x at
issuance. The largest tenants are Computer Associates
International (20.4%), Operon Technologies (10.4%), and Insite
Vision (8.2%). Based on the stable to improved performance, both
loans maintain investment grade credit assessments.

Of concern is an office property located in Phoenix, Arizona,
comprising 1.7% of the pool. The property is 67% leased by
Arthur Andersen, who is currently negotiating with the borrower
for different options to vacate their space. Fitch will continue
to the monitor the performance of this loan, the credit
assessment loans and the remaining loans in the pool, as
surveillance is ongoing.


MOUNTAIN OIL: September 30 Working Capital Deficit Tops $180K
-------------------------------------------------------------
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 September 30, 2002, the Company had a working capital
deficiency, an accumulated deficit, and has incurred substantial
operating losses.   These conditions raise substantial doubt
about the ability of the  Company to continue as a going
concern. Management intends to reduce operating costs through
the reduction of personnel and direct production efforts to the
more profitable wells. If the Company is unable to obtain
profitable operation it will require additional debt or equity
financing. There can be no assurance that the Company will be
successful in its efforts to secure debt or equity financing
should the need arise.

Net oil and gas sales were $458,000 and $876,000 for the nine
months ended September 30, 2002 and 2001,  respectively.  This
48% decrease in sales is primarily attributable to decreasing
both the number of  producing wells, and the production rates of
existing wells.  For the nine months ended September 30, 2002
the Company received an average of $21.77 per barrel.  For the
three months ended September 30, 2002 and 2001, net oil and gas
sales were $170,000 and $336,000, respectively, resulting in a
49% reduction. The significant decrease in revenues was due to
Mountain Oil's continued effort at concentration on the
more profitable wells.  During 2002, in order to improve cash
flow the Company determined to focus its operating efforts on
the wells that were producing at the highest rate and at the
least cost.  Such efforts have improved cash flow and reduced
net loss but have resulted in a significant decrease in revenue.
If Mountain Oil is able to improve its cash flow in the future,
it may return to the currently non-producing wells with the
intent on upgrading and improving the equipment on such wells
thus resulting in increased productivity.  The Company also may
return to such wells if the price of oil increases to the extent
that production becomes economically feasible.

Mountain Oil realized a net loss of $128,000 for the nine months
ended September 30, 2002, as compared to a net loss of $331,000
for the nine months ended September 30, 2001.  For the three
months ended September 30, 2002, it realized a net loss of
$45,000, compared to a net loss of $90,000 for the three months
ended  September 30, 2001.

At September 30, 2002, the Company had a working capital deficit
of $180,000 as compared to $86,000 at December 31, 2001.  This
decrease to working capital is due to expenditures on capital
improvements during 2002 as well as payments on  debt.


NATIONSRENT INC: Wants to Re-Employ Kroll Zolfo as Consultant
-------------------------------------------------------------
NationsRent Inc., and its debtor-affiliates seek to re-employ
Kroll Zolfo Cooper LLC as bankruptcy consultants and special
financial advisors for the Debtors, effective as of September 6,
2002.

Michael J. Merchant, Esq., Richards, Layton & Finger, informs
the Court that Zolfo Cooper LLC, the Debtors' original financial
advisors is now a first-tier subsidiary of Kroll Inc., a
publicly traded Delaware Corporation.  On September 5, 2002, the
members of Zolfo Cooper transferred all their membership
interests in the firm to Kroll.  On the same date, 100% of the
issued and outstanding shares in Zolfo Cooper's affiliates:

     * Zolfo Cooper Advisors, Inc.;
     * Zolfo Cooper Management Advisors, Inc. and
     * Zolfo Cooper Services, Inc.

were transferred to Zolfo Cooper Holdings, Inc.  In turn, 100%
of Zolfo Cooper Holdings' common stock was transferred to Kroll.

Mr. Merchant further relates that, since November 8, 2002, Zolfo
Cooper has used the name Kroll Zolfo Cooper LLC.  But in the
interim, Zolfo Cooper was authorized to do business under the
alternate name of Kroll Zolfo Cooper since September 6, 2002.

Notwithstanding Kroll's acquisition of Zolfo Cooper, Kevin M.
Golmont of Kroll Zolfo Cooper ascertains that his firm:

   -- has no connection with the Debtors, their creditors or
      other parties-in-interest in these cases;

   -- does not hold any interest adverse to the Debtors'
      estates; and

   -- is a "disinterested person" as defined in Section 101(14)
      of the Bankruptcy Code. (NationsRent Bankruptcy News,
      Issue No. 23; Bankruptcy Creditors' Service, Inc.,
      609/392-0900)


NEOFORMA INC: Extends VHA Credit Facility Until Dec. 31, 2004
-------------------------------------------------------------
Neoforma, Inc., (Nasdaq: NEOF) and VHA Inc., have agreed to
extend from May 31, 2003, until December 31, 2004, the maturity
date of the $25.0 million line of credit that VHA has made
available to Neoforma. Neoforma and VHA also have agreed to
modify the rate at which borrowed amounts bear interest.

Under the previous terms, borrowed funds bore interest at a
fixed rate of 10.0% per year. Under the terms of the amended
agreement, borrowed funds bear interest at a floating rate equal
to the prime rate plus 2.75%. Based on the current prime rate,
this equates to a total interest rate of 7.0%.

In connection with this amendment, Neoforma intends to reduce
the amount of principal outstanding to $14.0 million by making a
$5.0 million payment to VHA using existing cash balances. The
total capacity of the line of credit will remain at $25.0
million.

"The $5.0 million debt reduction and the modifications to the
line of credit reflect the ongoing strengthening of Neoforma's
balance sheet," says Andrew Guggenhime, chief financial officer
of Neoforma. "Our financial and operational flexibility continue
to grow as we generate positive cash flow."

Neoforma builds and operates Internet marketplaces that empower
healthcare trading partners to optimize supply chain
performance. Neoforma uses proven, scalable technologies to
provide customized marketplace solutions and services that
enable customers to maximize their existing technology and
supply chain relationships. Healthcare providers, leading group
purchasing organizations, manufacturers and distributors choose
Neoforma as their e-commerce partner. For more information,
visit the company's Web site at http://www.neoforma.com

Neoforma's September 30, 2002 balance sheet shows that total
current liabilities exceeded total current assets by about $11
million.


NETIA HOLDINGS: Sets Extraordinary General Meeting for Jan. 15
--------------------------------------------------------------
Netia Holdings S.A., (WSE: NET) Poland's largest alternative
provider of fixed-line telecommunications services (in terms of
value of generated revenues), will hold an Extraordinary General
Meeting of Shareholders on January 15, 2003, in Warsaw.

The proposed resolutions to be considered at this meeting
concern, among other things, changes to Netia's Statutes,
changes in the composition of Netia's supervisory board and
establishment of certain security interests over certain assets
of the Netia group companies in order to secure the obligations
under the EUR50 million Senior Secured Notes due 2008 to be
issued by Netia Holdings B.V. in connection with the ongoing
restructuring of Netia.

Netia Holdings SA's 13.50% bonds due 2009 (NETH09NLN2) are
trading at about 17 cents-on-the-dollar, DebtTraders says. See
http://www.debttraders.com/price.cfm?dt_sec_ticker=NETH09NLN2
for real-time bond pricing.


NETIA: Taking Subscription for Series H Shares Today
----------------------------------------------------
Netia Holdings S.A., (WSE: NET), Poland's largest alternative
provider of fixed-line telecommunications services (in terms of
value of generated revenues), announced that the subscription of
series H shares originally scheduled to take place on
December 20, 2002, was rescheduled for today, December 23, 2002.

The subscription for series H shares will open today,
December 23, 2002, at 8:00 a.m. CET and close on December 23,
2002, at 6:00 p.m. CET or immediately after subscription by all
eligible parties.

The subscription was postponed to enable Netia to complete the
subscription on the same day as the issue of EUR 50 million
Senior Secured Notes due 2008 to be issued by Netia Holdings
B.V., in accordance with the terms of the Restructuring
Agreement dated March 5, 2002 and the composition plans of Netia
Holdings B.V., Netia Holdings II B.V., and Netia Holdings III
B.V., Netia's Dutch subsidiaries.

The issuances of series H shares and new notes constitute some
of the final steps in the implementation of the ongoing
financial restructuring of Netia.


NORTEL NETWORKS: Board Declares Preferred Share Dividends
---------------------------------------------------------
The board of directors of Nortel Networks Limited declared a
dividend on each of the outstanding Cumulative Redeemable Class
A Preferred Shares Series 5 (TSX:NTL.PR.F) and the outstanding
Non-cumulative Redeemable Class A Preferred Shares Series 7
(TSX:NTL.PR.G), the amount of which for each series will be
calculated by multiplying (a) the average prime rate of Royal
Bank of Canada and Toronto-Dominion Bank during January 2003 by
(b) the applicable percentage for the dividend payable for such
series for December 2002 as adjusted up or down by a maximum of
4 percentage points (subject to a maximum applicable percentage
of 100 percent) based on the weighted average trading price of
the shares of such series during January 2003, in each case as
determined in accordance with the terms and conditions of such
series. The dividend on each series is payable on February 12,
2003 to shareholders of record of such series at the close of
business on January 31, 2003.

Nortel Networks is an industry leader and innovator focused on
transforming how the world communicates and exchanges
information. The company is supplying its service provider and
enterprise customers with communications technology and
infrastructure to enable value-added IP data, voice and
multimedia services spanning Wireless Networks, Wireline
Networks, Enterprise Networks, and Optical Networks. As a global
company, Nortel Networks does business in more than 150
countries. More information about Nortel Networks can be found
on the Web at http://www.nortelnetworks.com


N. AMERICAN REFRACTORIES: Honeywell to Fund Sec. 524(g) Trust
-------------------------------------------------------------
Honeywell (NYSE: HON) expects to take a fourth-quarter after-tax
charge of approximately $1.9 billion. The charge covers costs
associated with the potential resolution of North American
Refractories Company (NARCO)-related asbestos claims, asset
write-downs in the company's Specialty Materials and Friction
Materials businesses, repositioning and other actions.

Honeywell also said it expects ongoing earnings for 2002's
fourth quarter to be 50 cents per share; the charge is expected
to result in a reported loss of approximately $1.80 per share
for the quarter. The company also anticipates that it will
exceed $1.8 billion in free cash flow in 2002.

"Honeywell is taking decisive action to improve the efficiency
of our operations while continuing to sharpen our focus on
customers and growth," said Honeywell Chairman and CEO Dave
Cote.

"The actions announced [Thurs]day demonstrate that we are
steadfast in our commitment to improving our cost structure,
addressing the economic realities of our markets, and taking the
necessary actions to ensure a firm foundation for growth and
performance in all of our businesses," Mr. Cote added.
"Resolution of the NARCO-related asbestos claims would be an
enormous positive for the company, bringing closure to a
significant portion of the company's asbestos liability."

      NARCO-Related Asbestos Settlement Negotiations

Based on the current state of negotiations with plaintiffs'
counsel representing NARCO asbestos claimants, Honeywell
estimates a NARCO bankruptcy trust-related after-tax charge of
approximately $900 million, net of anticipated insurance
recoveries. NARCO, which filed for reorganization under Chapter
11 of the U.S. Bankruptcy Code in January 2002, is a company
that was sold by Honeywell in 1986.

Honeywell and NARCO are seeking to establish a trust under
Section 524 (g) of the U.S. Bankruptcy Code. If approved by the
court, the trust would bar any future NARCO-related asbestos
claims against Honeywell and NARCO in state and federal courts;
instead, all future claims would be directed to the federally
supervised trust. By law, agreement with counsel representing
75% of current claimants is required before the bankruptcy court
will consider the trust for approval.

The asbestos-related reserves are primarily linked to
anticipated company contributions over time, net of insurance,
that are associated with the 524 (g) trust process to resolve
all current and future claims. Settlement payments with respect
to current claims would be made over a four-year period.
Contributions required to fund future claims would be capped at
an annual level that would not have a material impact on
Honeywell's operating cash flows - assuming the successful
completion of ongoing settlement negotiations.

Honeywell is a diversified technology and manufacturing leader,
serving customers worldwide with aerospace products and
services; control technologies for buildings, homes and
industry; turbochargers; automotive products; specialty
chemicals; fibers; plastics; and electronic and advanced
materials. Based in Morris Township, N.J., Honeywell is one of
30 stocks that make up the Dow Jones Industrial Average and is a
component of the Standard & Poor's 500 Index. Its shares are
traded on the New York Stock Exchange under the symbol HON, as
well as on the London, Chicago and Pacific Stock Exchanges. For
more information about Honeywell, visit http://www.honeywell.com


NRG NORTHEAST: S&P Lowers Credit Rating Down to Default Level
-------------------------------------------------------------
Standard & Poor's Ratings Services lowered its corporate credit
rating on NRG Northeast Generating LLC to 'D' from 'CC'. At the
same time, Standard & Poor's lowered its ratings on NRG
Northeast's $126 million 8.842% senior secured bonds due
Dec. 15, 2010; its $320 million 8.061% senior secured bonds due
Dec. 15, 2004; and its $300 million 9.292% senior secured bonds
due Dec. 15, 2024 to 'D' from 'CC'.

The rating actions follow NRG Northeast's nonpayment of
principal and interest due Dec. 15, 2002, on all three of the
bond issues. NRG Northeast has 15 days to make principal and
interest payments to avoid an event of default.


NRG ENERGY: Unit Fails to Make Payments on Bonds Due December 15
----------------------------------------------------------------
NRG Energy, Inc., a wholly owned subsidiary of Xcel Energy
(NYSE:XEL), provided an update on its NRG Northeast Generating
LLC bond series, announcing that payments have not been made on
the bond series that were due December 15. The payments include
$78.3 million in combined principal and interest obligations on
NRG Northeast Generating LLC 8.06 percent Series A-1 senior
secured bonds due 2004, 8.84 percent Series B-1 senior secured
bonds due 2015 and 9.29 percent Series C-1 senior secured bonds
due 2024. NRG has until December 30 to make principal and
interest payments on these series.

Also, Standard and Poor's Ratings Services lowered the corporate
credit rating on NRG Energy Northeast Generating LLC to "D" from
"CC."

"We do not believe that these missed payments, nor the
subsequent downgrade, will affect the course of NRG's
restructuring discussions," said Richard C. Kelly, NRG president
and chief operating officer. "We are continuing to work with our
lenders toward an overall restructuring of NRG's debt and intend
to address these payments as part of the broader plan."

NRG Northeast Generating LLC bond series are non-recourse to NRG
and Xcel Energy.

NRG Energy, a wholly owned and unregulated subsidiary of Xcel
Energy, develops and operates power generating facilities. NRG's
operations include competitive energy production and
cogeneration facilities, thermal energy production and energy
resource recovery facilities.

Xcel Energy is a major U.S. electricity and natural gas company
with regulated operations in 12 Western and Midwestern states.
The company 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
U.S. Company headquarters are located in Minneapolis.


OWENS CORNING: Del. Court Says Yes to Settlement Pact with DEQ
--------------------------------------------------------------
Owens Corning and its debtor-affiliates sought and obtained
Court approval on its settlement agreement with the Oregon
Department of Environmental Quality.

The settlement arose in connection with the site generally
located at 1645 Railroad Ave., St. Helens in Columbia County,
Oregon and identified in the DEQ's ECSI database as Site 91 or
the St. Helens' site.

J. Kate Stickles, Esq., at Saul Ewing LLP, in Wilmington,
Delaware, relates that the Debtors owned the site between 1978
and 1986 and conducted manufacturing operations there between
1978 and 1982.  The Debtors acquired the site from Kaiser Gypsum
Co., which performed manufacturing operations on the site
between 1956 and 1978.  The site has been home to industrial
operations since 1929.  The Debtors conveyed the site to
Armstrong Worldwide Industries Inc. pursuant to an Asset
Purchase Agreement dated December 31, 1986.  Armstrong has
conducted industrial operations on the site since that time.

According to Ms. Stickles, the DEQ has detected naphtha in soils
and in groundwater, metals in stormwater runoff, chrysene and
dibutylphthalate in surface impoundment soils, methylene
chloride in surface impoundment waters and free product
petroleum in the groundwater.  The DEQ also has reported that
surface and subsurface contaminants may represent a threat to
on-site workers or utility trench workers but the full extent of
contamination has not been defined.  The DEQ intends to
determine the extent of contamination at the site, which is a
high priority for further action.

The present form of the stipulation provides that:

A. Owens Corning agrees to the terms of the stipulation without
   admission of any liability or violation of the law;

B. Owens Corning will pay $900,000 to the State of Oregon,
   Hazardous Remedial Action Fund after Court approval and
   within 30 days after entry of the stipulation Oregon Circuit
   Court.  The payment will be in full satisfaction of any
   liability Owens Corning may have for payment of the DEQ's
   remedial action costs -- both incurred and to be incurred at
   any time in the future, and including any oversight or other
   costs that the DEQ might claim -- with respect to the
   contamination at the site, excluding the sediments of
   Scappoose Bay that lie continuously below the low waterline
   of the Columbia River.  The DEQ will expend these amounts, to
   the extent required, on activities or oversight related to
   the investigation and remediation of the site.  In no event
   will DEQ have the right to require the Debtors to perform any
   activity or to participate in any action regarding the site
   or to pay more than the settlement sum with respect to the
   site;

C. Upon timely payment of $900,000, the Debtors will not be
   liable for claims for contribution regarding matters
   addressed in the stipulation;

D. Nothing in the stipulation will prevent the Debtors from
   exercising any rights of contribution or indemnification the
   Debtors might have against any person not a party to the
   stipulation regarding the site;

E. The stipulation is without prejudice to any of the Debtors'
   claims, rights, and defenses against third parties; and

F. Upon payment by the Debtors, the DEQ has agreed not to sue
   or take any other action, including but not limited to
   judicial or administrative action, against the Debtors
   concerning any liability to the State of Oregon with regard
   to the release or threatened release of hazardous substances
   at the site addressed by the stipulation.

As a former owner of the site, the Debtors are liable for the
cost of cleaning up the site.  Ms. Stickles relates that the
Debtors' independent consultants have pegged the cost at
$4,600,000.  Where more than one owner or operator is
potentially liable for cleanup costs, liability for cleanup
costs may be allocated among them based on equitable principles.

To date, Armstrong has asserted claims relating to the site
against the Debtors.  The Debtors also maintain that Armstrong
is indebted to them for indemnification under the Asset Purchase
Agreement, as well as applicable federal and state laws. (Owens
Corning Bankruptcy News, Issue No. 42; Bankruptcy Creditors'
Service, Inc., 609/392-0900)


PACIFIC GAS: CPUC Presses for Summary Judgment Denying Plan
-----------------------------------------------------------
The California Public Utilities Commission asks the Court to
grant a summary judgment denying the confirmation of Pacific Gas
and Electric Company's Reorganization Plan.  The CPUC argues
that Section 7.5(d) of the PG&E Plan is contrary to the valid,
non-preempted law of the State of California and would result in
ongoing illegality by PG&E following its reorganization.

Section 7.5(d) of the PG&E Plan provides that PG&E will not
assume the so-called "net open position" until, among other
things, it has received an investment-grade credit rating.  The
"net short" or "net open" position refers to the resulting
deficit in power -- the power that must be purchased to meet
customer needs.  To "assume the NOP" means, essentially, to
purchase the power necessary to keep PG&E's customers' lights
turned on.

However, Arocles Aguilar, Esq., at Paul, Weiss, Rifkind, Wharton
& Garrison, points out that the authority of the California
Department of Water Resources to purchase and provide power to
PG&E's California customers, which it has been doing since
January 2001, will expire on January 1, 2003.  At that point,
the residents of Northern California will once again have to
look to PG&E to meet all of their electricity needs.  Mr.
Aguilar contends that these needs are often greater than can be
met from PG&E's own facilities and from existing contracts.  But
with the PG&E Plan, Mr. Aguilar notes that PG&E is seeking in
effect to enjoin itself, for an indefinite period of time, from
complying with its obligation under California law to serve its
customers.

The CPUC asserts that:

1. PG&E's obligation to serve requires it to assume the NOR.
   This obligation stems from the CPUC Code and the common law.
   The CPUC Code Section 451 requires every utility to furnish
   and maintain adequate, efficient, just and reasonable
   service, instrumentalities, equipment and facilities as are
   necessary to promote the safety, health, comfort and
   convenience of its patrons, employees and the public; and

2. PG&E's obligation to serve the customers is not affected by
   District Judge Walker's decision in In re Pacific Gas and
   Elec. Co., 283 B.R. 41, (N.D.Cal., 2002), which upheld PG&E's
   theory that Section 1123(a)(5) of the Bankruptcy Code
   expressly preempts state and federal law in certain respects.
   Under the legal theory adopted by Judge Walker, plan
   provisions may preempt state laws relating to "transactions
   necessary for restructuring," but not state laws that
   prohibit "ongoing illegality."  Mr. Aguilar recounts that,
   while PG&E has made contradictory statements on the matter
   during the case, it told Judge Walker, before he made his
   decision, that that decision would not affect the obligation
   to serve.

"There can be no doubt on which side Section 7.5(d) of the
Debtor's Plan falls -- it seeks to authorize 'ongoing
illegality.'  It does not authorize, or even refer to, any
'transaction' that is part of, or necessary for, the
reorganization that PG&E is proposing," Mr. Aguilar argues.
"Rather, it states that, for however many months or years it
takes PG&E to attain an investment grade credit rating and to
meet several other self-imposed conditions, PG&E will not assume
the NOP."

Accordingly, Mr. Aguilar asserts that Section 7.5(d) is illegal
and its presence in the Debtor's Plan renders that plan
unconfirmable. (Pacific Gas Bankruptcy News, Issue No. 50;
Bankruptcy Creditors' Service, Inc., 609/392-0900)


PAC-WEST TELECOMM: Advances Interconnection Arbitration with SBC
----------------------------------------------------------------
Pac-West Telecomm, Inc. (Nasdaq: PACW), a provider of integrated
communications services to service providers and business
customers in the western U.S., announced that it's arbitration
regarding a new Interconnection Agreement with SBC
Communications is near completion. The California Public
Utilities Commission is scheduled to consider the agreement for
approval at its public meeting, which is tentatively scheduled
for mid-January in 2003.

Wally Griffin, Pac-West's Chairman and CEO, said, "The draft
agreement is within the range of our expectations and the rates
we have been using in our business planning. It reaffirms our
business model and the guiding principles set forth in the 1996
Telecom Act."

Ravi Brar, Pac-West's Chief Financial Officer, said, "Based on
the potential outcome of the ICA arbitration, we are able to
significantly narrow the range of our expected financial results
for the fourth quarter of 2002, as well as our annual targets
for 2003. We are on track to achieve our fourth quarter 2002
revenue target of $45 million, and adjusted EBITDA (earnings
before interest, net, income taxes, depreciation and
amortization, restructuring and impairment charges, gain on
repurchase of bonds and income or loss on asset dispositions)
target of $16 to $17 million. Fourth quarter 2002 results
include the receipt of $15.8 million in claims and disputes from
SBC Communications. In addition, fourth quarter 2002 results
include the impact of a timing difference in the recognition of
reciprocal compensation revenue, which reduced both revenue and
adjusted EBITDA by $4 million for the quarter. 2003 revenue will
be impacted by the anticipated lower reciprocal compensation
rates in our proposed SBC agreement, and by Verizon's expected
implementation of the FCC order on reciprocal compensation.
While some of this impact will be offset by growth in other
areas, we currently expect our 2003 revenue to be in the range
of $120 to $140 million. The revenue reduction will largely flow
directly to adjusted EBITDA; therefore, we currently expect our
2003 adjusted EBITDA to be in the range of $15 to $22 million.
It will take time for revenue growth to offset the lower rates,
however as we have previously reported, we have been expecting
and preparing for this potential outcome in our business
planning."

Founded in 1980, Pac-West Telecomm, Inc., supplies Internet
access services to Internet and other types of service
providers, and integrated voice and data communications services
to small and medium-sized businesses. The company estimates that
its network carries over 20% of the Internet traffic in
California. Pac-West currently has operations in California,
Nevada, Washington, Arizona, and Oregon. For more information,
please visit the company's Web site at http://www.pacwest.com

                         *     *     *

As reported in Troubled Company Reporter's November 20, 2002
edition, Standard & Poor's lowered its corporate credit
rating on competitive local exchange carrier Pac-West Telecomm
Inc., to 'CC' from 'CCC-'.

The senior unsecured debt rating on the company remains at 'C'.
The ratings were removed from CreditWatch with negative
implications. The outlook is negative. At the end of September
2002, Stockton, California-based Pac-West had total debt of more
than $106 million.


POLYONE CORP: Fitch Hatchets Senior Unsecured Debt Rating to BB
---------------------------------------------------------------
Fitch Ratings has downgraded PolyOne Corporation's senior
unsecured debt rating to 'BB' from 'BBB-' and its senior secured
credit facility to 'BB' from 'BBB-'. The Rating Outlook remains
Negative.

The downgrade reflects weaker than expected financial
performance. The company recently announced an expected net loss
for the fourth quarter of 2002. PolyOne's financial weakness is
also evident in its credit statistics. For the trailing twelve-
months ended September 30, 2002, EBITDA-to-interest was 2.3
times and total debt (including the A/R program balance)-to-
EBITDA was 6.6x. EBITDA for the trailing twelve-months ended
September 30, 2002 has not improved over EBITDA of $134.0
million for the same period in 2001 or the year-end 2001 level
of $127.6 million. Operating income for the business segments
has shown some improvement in the first nine months of 2002
versus the same period in 2001. However, the improvement is not
readily apparent in EBITDA due to a decline in depreciation and
amortization expense over the comparable periods. Debt
(including the A/R program balance) has increased to $801.1
million from $663.6 million at year-end 2001. PolyOne did issue
$200 million in senior unsecured debt earlier in 2002; however,
the proceeds from the issuance went to refinance existing debt.
Debt is expected to decline slightly in the fourth quarter due
to seasonal changes in working capital that can be applied to
debt reduction and the potential impact of the previously
announced So.F.teR S.p.A. divestiture. Greater progress in debt
reduction may result from future asset sales. The weakness of
PolyOne's position is further highlighted by the expected fourth
quarter violation of the interest coverage covenant associated
with its senior secured bank facility and current negotiations
with the lenders to amend covenants for 2003.

The negative rating outlook suggests the uncertainty regarding
the level of financial improvement that will be attained in the
near-term. The strength of the economic recovery in 2003 and the
volatility of raw materials will certainly underpin the
company's future earnings recovery and free cash flow
generation. Debt reduction will likely depend more upon
successful asset sales than free cash flow generation.

PolyOne is the largest compounder of plastics and rubber and one
of the leading distributors of plastic resins in North America.
The company had 2001 sales of $2.8 billion and EBITDA of $127.6
million.


PROVANT: Selling Several Businesses to Drake Beam for $30 Mill.
---------------------------------------------------------------
On December 15, 2002, Provant, Inc., entered into an agreement
calling for the sale for $30 million to Drake Beam Morin-Japan,
a leading Japanese human resource services provider, of
Provant's Performance Solutions, Technology and Development,
Vertical Markets and Project Management groups and Learning and
Strategic Alliances businesses. Provant will retain its
Government and Leadership Consulting groups.

The purchase price will consist of $23.5 million cash, subject
to a working capital adjustment, and the assumption by DBM-J of
substantially all of Provant's non-bank indebtedness. No taxes
will be payable by Provant as a result of the transaction.
Provant intends to use the cash proceeds less expenses to reduce
bank debt. The transaction is subject to necessary bank and
third-party consents and other customary closing conditions. The
parties anticipate a closing at year-end. DBM-J is a publicly
held company in Japan and an independent licensee of DBM, Inc.,
a subsidiary of Thomson Inc.  DBM, Inc., is not involved in this
transaction.

The principal businesses to be sold are J. Howard and
Associates, BT.Novations, Project Management, Strategic
Interactive, Executive Education Institute, MOHR Learning, KC-
EP, Provant Media and Decker Communications. In fiscal 2002
those businesses had aggregate revenues of slightly less than
half of Provant's revenues for that year. After the sale,
Provant's businesses will be its Government and Leadership
Consulting Groups, consisting principally of Star Mountain and
Senn-Delaney Leadership.

As a leading provider of performance improvement training
services and products, Provant helps its clients maximize their
effectiveness and profitability by improving the performance of
their people. With over 1,500 corporate and government clients,
the Company offers blended solutions combining web-based and
instructor-led offerings that produce measurable results by
strengthening the performance and productivity of both
individual employees and organizations as a whole.

For more information visit http://www.provant.com

                         *    *    *

As reported in Troubled Company Reporter's November 7, 2002
edition, Provant continues to be in default under its credit
facility agreement, and "believe[s] [the Company is] close to
finalizing the terms of an extension to it that would
end the current default."

The terms of this extension will, among other things, extend the
due date of the facility to April 15, 2003, subject to the
Company's continued obligation to take actions that would result
in the early repayment of our indebtedness to the banks. The
Company continues to pursue various strategic alternatives,
which include the sale of Provant or various of its assets.


QWEST COMMS: Debt Exchange Offer Expired Friday as Scheduled
------------------------------------------------------------
Qwest Communications International Inc., (NYSE: Q) announced
that the complaint filed by certain Qwest Capital Funding, Inc.,
noteholders in connection with Qwest's $12.9 billion debt
exchange offer was voluntarily dismissed by the plaintiffs.
Wednesday last week, a judge for the United States District
Court for the Southern District of New York denied the
plaintiffs' request to delay the exchange offer. As a result,
the exchange offer expired as originally scheduled, on Friday,
December 20, 2002 at 11:59 p.m., EST.

"We said from the outset that the plaintiffs' claims were
without merit, and this voluntary dismissal validates our
position," said Richard N. Baer, Qwest executive vice president
and general counsel.

Qwest Communications International Inc., (NYSE: Q) is a leading
provider of voice, video and data services to more than 25
million customers. The company's 53,000-plus employees are
committed to the "Spirit of Service" and providing world-class
services that exceed customers' expectations for quality, value
and reliability. For more information, please visit the Qwest
Web site at http://www.qwest.com

Qwest Communications' 7.50% bonds due 2008 (QUS08USR4) are
trading at about 76 cents-on-the-dollar, DebtTraders reports.
See http://www.debttraders.com/price.cfm?dt_sec_ticker=QUS08USR4
for real-time bond pricing.


RESEARCH INC: Minnesota Court Confirms Reorganization Plan
----------------------------------------------------------
On January 24, 2002, Research, Incorporated filed a voluntary
petition for relief under Chapter 11 of the United States
Bankruptcy Code in the United States Bankruptcy Court for the
District of Minnesota, Fourth Division.

On November 27, 2002, the Court entered an order confirming a
Plan of Reorganization filed on October 17, 2002 and dated
October 16, 2002. The Plan is effective as of the first business
day immediately following the later of (a) 15 calendar days
after the confirmation date or (b) the first date upon which all
of the conditions of the Plan have been satisfied or waived. The
Effective Date of the Plan is expected to be December 31, 2002.
Conditions to the effectiveness of the Plan include contribution
of cash and debt by Research Technologies Corporation, a wholly-
owned subsidiary of Squid Ink Manufacturing, Inc., payment of
the fees of the bankruptcy trustee, and satisfaction of all of
the condition to the closing of that certain Stock Purchase
Agreement dated September 13, 2002 between the Company and New
Research.

Upon the effectiveness of the Plan, Messrs. William T. Hoagland,
David R. Mylrea, Daniel W. Dryer and John L. Larsen will
constitute the Board of Directors of the Company. Further, the
management of the Company will consist of: William T. Hoagland,
President and Chief Executive Officer; David R. Mylrea,
Executive Vice President and Secretary; Brad C. Yopp, Senior
Vice President; and Bruce E. Bailey, Vice President.

In connection with the effectiveness of the Plan, the Company
will adopt Amended and Restated Articles of Incorporation. Under
the Articles of Incorporation, the Company will have authorized
one million (1,000,000) shares of common stock $.01 par value.

As of January 24, 2002, the date the petition was filed with the
Court, there were 1,328,565 shares of the Company's common stock
issued and outstanding. As a result of the Plan, as of the
Effective Date, all of the Company's Old Common Stock will be
canceled and all options and warrants to purchase the Company's
Old Common Stock existing as of the petition date will be
canceled. With the effectiveness of the Plan, the Company will
issue all 1,000,000 shares of its new common stock to New
Research pursuant to the Stock Purchase Agreement. Of the total
consideration to be received by the Company under the Stock
Purchase Agreement, certain amounts will be used to fund
obligations of the Plan and to provide post-confirmation working
capital.

Upon consummation of the Stock Purchase Agreement, New Research
will be the only holder of the Company's common stock.
Therefore, the Company intends to file a Form 15 with the
Securities and Exchange Commission to terminate the registration
of its common stock under Section 12 of the Securities Exchange
Act of 1934, as amended and discontinue its obligations as a
reporting company under the Act.

Furthermore, under the Plan, the Company will make certain cash
payments to the holders of the various classes of claims.
Holders of priority tax claims will receive payment in full and
in cash on the effective date of the Plan. Holders of certain
priority non-tax claims will receive a one-time cash payment on
the distribution date in the amount of the holder's allowed
claim. In the case of wages, salaries and  commissions, the
payment amount to any holder is capped at $4,650. Holders of
general unsecured claims will receive a payment on the
distribution date equal to it's pro rata share of $100,000 less
the claims paid to the priority tax and priority non-tax claims
and administrative convenience claims, $100,000 upon collection
of the CVD Holdback, 50% of the CVD Holdback when collected and
a final payment of up to $460,000 to be paid in 18 equal
quarterly installments with interest beginning the seventh month
following the effective date. The amount to be received by
general unsecured claim holders upon collection of the CVD
Holdback depends upon the amounts received under that certain
Asset Purchase Agreement dated November 9, 2001 between the
Company and CVD Equipment Corporation. Holders of certain
administrative convenience claims will receive cash payments of
30% of their allowed claim, which claim may not exceed $500.
Certain postpetition liabilities incurred by the Company will be
paid in accordance with the terms of the particular transactions
relating to the liabilities. The Company's debtor-in-possession
lender, Manchester Commercial Finance LLC, will be paid
according to the terms of its loan documents with the Company.


RESTORAGEN INC: Case Summary & 20 Largest Unsecured Creditors
-------------------------------------------------------------
Debtor: Restoragen, Inc.
        3820 NW 46th Street
        Lincoln, NE 68542
        fka BioNebraska, Inc.

Bankruptcy Case No.: 02-83998

Type of Business: Development stage biotechnology company that
                  is seeking to commercialize recombinant GLP-1
                  (rGLP-1) for certain niche cardiovascular
                  indications.

Chapter 11 Petition Date: December 17, 2002

Court: District of Nebraska (Omaha Office)

Judge: Timothy J. Mahoney

Debtor's Counsel: James A. Lodoen, Esq.
                  Lindquist & Vennum P.L.L.P.
                  4200 IDS Center
                  80 South Eighth Street
                  Minneapolis, MN 55402

                        -and-

                  James J Niemeier, Esq.
                  McGrath, North, Mullin & Kratz, P.C.
                  222 South 15th Street
                  1400 One Central Park Plaza
                  Omaha, NE 68102
                  Tel: (402) 341-3070
                  Fax: (402) 341-0216

                       -and-

                  Robert J. Bothe, Esq.
                  McGrath, North, Mullin & Kratz, PC
                  Suite 3700 First National Tower
                  1601 Dodge St.
                  Omaha, NE 68102
                  Tel: (402) 341-3070
                  Fax: (402) 341-0216

Total Assets: $3,729,047

Total Debts: $23,292,628

Debtor's 20 Largest Unsecured Creditors:

Entity                      Nature Of Claim       Claim Amount
------                      ---------------       ------------
Transamerica Technology     Equipment Lease         $1,000,000
Finance                     Deficiency
Riverwayll, West Office Tower
9399 West Higgins Road
Rosemont, IL 60018

Leasing Technologies, Inc.  Scientific Equipment      $500,000
221 Danbury Road
Wilton, CT 06897

Coolidge, Thomas R.         Employment Contract       $162,975

Wagner, Fred                Employment Contract       $161,250

Holmquist, Barton           Employment Contract       $130,106

BioContractor AB            Trade Debt                 $42,050

Pharmanet                   Trade Debt                 $37,694

UN Medical Center           Trade Debt                 $38,136

IOS Capital Office          Equipment Lease            $34,829
                            Deficiency

B S B Leasing               Scientific Equipment       $30,504
                            Lease Deficiency

GE Capital                  Scientific Equipment       $28,172
                            Lease Deficiency

GE Capital Business Finance Scientific Equipment       $28,814
C-97550

Dolphin Capital Corp.       Scientific Equipment       $24,664
                            Lease Deficiency

Black, Hugh E.              Trade Debt                 $18,025

Advanta Leasing Services    Scientific Equipment       $14,788
                            Lease Deficiency

Citicorp Vendor Fin. Inc.   Equipment Lease Deficiency $13,469

Ehlers, Mario               Employment Contract        $33,333

Hickey, Christopher         Employment Contract        $28,334

Information Leasing Corp.   Engineering Utility        $15,876
                            Equipment Lease Deficiency


RITE AID CORP: Nov. 30 Balance Sheet Upside-Down by $105 Million
----------------------------------------------------------------
Rite Aid Corporation (NYSE, PCX:RAD) announced financial results
for its third quarter, ended November 30, 2002.

Revenues for the 13-week third quarter were $3.9 billion versus
revenues of $3.7 billion in the prior year third quarter.
Revenues increased 4.0 percent.

Same store sales increased 6.7 percent during the third quarter
as compared to the prior year third quarter, reflecting
prescription sales growth of 9.6 percent and a 1.9 percent
increase in front-end same store sales. Prescription sales
accounted for 64.3 percent of total sales, and third party
prescription sales represented 92.9 percent of pharmacy sales.

Third quarter earnings before interest, taxes, depreciation and
amortization, LIFO charges, gains from asset disposals and non-
operating charges (EBITDA) amounted to $161.1 million or 4.2
percent of sales. This compares to $77.5 million or 2.1 percent
of sales last year.

"We are extremely pleased with our third quarter results. EBITDA
not only beat the high end of our guidance, it also more than
doubled compared to last year. We saw healthy increases in both
pharmacy and front-end same stores sales in an operating
environment that's been tough for all retailers," said Mary
Sammons, Rite Aid president and chief operating officer. "Once
again, our results highlight the substantial improvement we
continue to make in Rite Aid's overall performance."

Interest expense for the quarter was $80.9 million versus $82.5
million in the prior year's third quarter reflecting our
reduction in debt and lower overall interest rates on our
variable rate debt. Interest expense was comprised of $71.5
million of cash interest on indebtedness and capital lease
obligations and non-cash interest of $9.4 million.

Non-cash items in this quarter include a charge of $10.4 million
related to store closing and impairment and a $2.6 million
charge resulting from variable plan accounting for stock based
compensation. These items total non-cash charges of $13.0
million.

Net loss was $16.4 million for the quarter compared to a loss of
$112.8 million last year. The prior year loss includes a $39.4
million gain resulting from variable plan accounting for stock
based compensation.

Excluding the non-cash charges of $13.0 million, $6.6 million in
net litigation settlement income, $0.8 million of gains on asset
sales and $3.3 million of legal charges, the net loss would have
been $7.3 million.

During the third quarter, the company opened one new store,
remodeled 45 stores, relocated four stores and closed 34 stores.
Stores in operation at the end of the quarter totaled 3,411.

At November 30, 2002, Rite Aid's balance sheet shows a total
shareholders' equity deficit of about $105 million.

                    Company Provides Guidance
               for the Fourth Quarter Fiscal 2003,
                Raises Full Year EBITDA Guidance

Based on current trends, Rite Aid expects same store sales for
the fourth quarter of fiscal year 2003, which ends March 1,
2003, to increase 6 percent to 7 percent from the fourth quarter
of the prior year.

EBITDA for the fourth quarter is expected to be $160.0 million
to $170.0 million. This compares to $143.5 million in the prior
year fourth quarter.

The company raised EBITDA guidance for fiscal 2003 to a range of
$605.0 million to $615.0 million, compared to the previous range
of $565.0 million to $600.0 million.

"The improvement we've made year to date shows that our business
strategy is on target and our operating initiatives are on
track," said Bob Miller, Rite Aid chairman and chief executive
officer. "With these kind of results, and our strong liquidity
position, there's no question the company is on solid ground and
well positioned to deliver future value for our shareholders."

               Preliminary Outlook for Fiscal 2004

Based on preliminary business plans, Rite Aid said it expects
sales of $16.6 billion to $16.8 billion in fiscal 2004, which
ends February 28, 2004, with same store sales improving 6
percent to 7 percent over fiscal 2003. EBITDA for the year is
expected to be $675 million to $725 million. The company also
said it expects to generate $200 million to $250 million of free
cash flow for fiscal 2004.

Rite Aid Corporation is one of the nation's leading drugstore
chains with annual revenues of more than $15 billion and
approximately 3,400 stores in 28 states and the District of
Columbia. Information about Rite Aid, including corporate
background and press releases, is available through the
company's Web site at http://www.riteaid.com


SMOKY RIVER: Fitch Junks Class C Notes Rating at C from B-
----------------------------------------------------------
Fitch Ratings downgrades one class of notes issued by Smoky
River CDO, L.P (formerly known as Indosuez Capital Funding, IV
L.P.). The following rating action is effective immediately:

      -- $104,000,000 class C notes to 'C' from 'B-'.

Smoky River is a collateralized debt obligation (CDO), which is
backed by approximately 72% senior secured loans and 22% high
yield bonds. Smoky River, which closed on May 8, 1998, is
currently managed by RBC Leveraged Capital, a division of Royal
Bank of Canada.

On December 5, 2002, Smoky River triggered an Event of Default
due to the fund's failure to maintain an aggregate principal
balance of collateral debt securities equal to at least the
aggregate outstanding amount of the class A and class B notes.
Parties to the transaction were given Notice of Default on Dec.
9, 2002. The collateral manager is currently exploring options
to cure the Event of Default. As a result of the Event of
Default, the collateral manager no longer has the flexibility to
trade out of any portfolio assets.

Smoky River triggered an Event of Default due to the
deterioration of the credit quality of the portfolio assets. The
increase in defaulted assets has reduced the amount of asset
coverage available for the class A and B notes, as defaulted
assets are valued at expected recovery rather than at par. As of
the latest trustee report available, Nov. 29, 2002, the notional
amount of defaulted assets in the collateral portfolio was $93.8
million, which represented 12.5% of the $750 million collateral
debt securities. Fitch has reviewed in detail the current
portfolio holdings of the Fund. Included in this review, Fitch
discussed the current state of the portfolio with the collateral
manager and their portfolio management strategy going forward.

Fitch's rating on the class C notes addresses the return of
principal only. To date, the class C notes have received
distributions of approximately $81 million. Given the ongoing
failure of the class B over-collateralization test, we do not
expect the class C notes to receive any further interest
distributions. After reviewing the collateral portfolio and
adjusting for the market value of defaulted assets, Fitch has
determined that the original rating is not commensurate with the
current risk to the principal of the class C notes.

Fitch will continue to monitor and review this transaction for
any future ratings adjustments.


SOLECTRON CORP: Fiscal 1st Quarter Net Loss Widens to $71 Mill.
---------------------------------------------------------------
Solectron Corporation (NYSE: SLR), a leading provider of
electronics manufacturing and supply-chain management services,
reported sales of $3.1 billion in the first quarter of fiscal
2003, at the high end of the company's previously stated
guidance of $2.8 billion to $3.1 billion. That compares with
sales of $3.2 billion in the year-earlier quarter and $3.1
billion in the fourth quarter of fiscal 2002.

In the quarter ended Nov. 29, Solectron reported a net loss of
$71 million, compared with a net loss of $53 million in the
year-earlier period and a net loss of $2.6 billion in the fourth
quarter of fiscal 2002.

Excluding pre-tax restructuring and impairment charges of $102
million and a $34 million pre-tax gain from the repurchase of
debt, Solectron had a first-quarter loss of $7 million -- within
the company's guidance ranging from a 3-cent loss to break-even
EPS performance. Excluding restructuring, impairment and unusual
items, Solectron had earnings of $1 million in the same period
last year and a loss of $33 million in the fourth quarter of
fiscal 2002.

During the quarter, Solectron's key metrics continued to
improve:

     -- Sales reflected stability in the business.

     -- Gross margin improved to 7.5 percent, the highest level
        in six quarters.

     -- Operating profit was $12 million, excluding
        restructuring and impairment charges.

     -- Inventory turns increased to 6.3, the sixth straight
        quarter of improvement.

     -- Days sales outstanding improved for the third
        consecutive quarter, to 52 days.

     -- Cash-to-cash cycle decreased 6 days to 64 days.

In addition, the company repurchased $219 million in debt while
maintaining a cash position of nearly $2 billion.

"Our progress is on track and reflects the solid execution of
our plan to return the company to profitability and deliver
value to our stockholders," said Koichi Nishimura, Solectron
chairman, president and chief executive officer. "We are pleased
that new business wins in targeted segments continued to offset
ongoing weakness in certain technology end markets. For example,
our business in the consumer segment reached 5.5 percent of
companywide sales in the quarter, and our automotive business
reached 3 percent of sales. Our team is excited about our
growing success at diversifying the industries we serve.

"During the quarter, we took restructuring charges to further
reduce our general and administrative expenses, and we continue
to evaluate the opportunity for additional steps to shift more
of our activities from high-cost to lower-cost regions,"
Nishimura said. "With an expectation of seasonal softness in the
second quarter, our guidance is for sales to range from $2.8
billion to $3 billion, and earnings per share, excluding unusual
charges, to range from a 2-cent loss to break-even performance."

Solectron -- http://www.solectron.com-- provides a full range
of global manufacturing and supply-chain management services to
the world's premier high-tech electronics companies. Solectron's
offerings include new-product design and introduction services,
materials management, high-tech product manufacturing, and
product warranty and end-of-life support. Solectron, based in
Milpitas, Calif., is the first two-time winner of the Malcolm
Baldrige National Quality Award. The company had sales of $12.3
billion in fiscal 2002.

                        *    *    *

As previously reported in Troubled Company Reporter, Fitch
Ratings lowered Solectron Corporation's ratings as follows:
senior bank credit facility from 'BBB-' to 'BB', senior
unsecured debt from 'BBB-' to 'BB', and the Adjustable
Conversion Rate Equity Security Units from 'BB+' to 'B+'. The
Rating Outlook remains Negative.

The downgrades reflect the prolonged, significant reduction in
demand from Solectron's customers, which continues to weaken
operational performance and credit protection measures. In
addition, with the delay in new business as customers defer
ramping new projects in the face of continuing weak end-markets,
Fitch believes any sustainable recovery will not materialize in
2002. The ratings also consider Solectron's top-tier position in
the electronic manufacturing services industry, diversity
of end-markets and geographies, recent improvements in its
capital structure, solid cash position, and recent working
capital improvements albeit in an industry downturn. The
Negative Rating Outlook indicates that if adverse market
conditions persist, outsourcing contracts do not materialize
from new customers, the company makes significant cash
acquisitions, or if it is unsuccessful in execution of planned
cost reductions the ratings may continue to be negatively
impacted.


STERLING CHEMICALS: Successfully Emerges from Bankruptcy
--------------------------------------------------------
Sterling Chemicals, Inc., and certain of its direct and indirect
subsidiaries have successfully emerged from bankruptcy. At
emergence, Sterling received a $60 million equity infusion,
including $30 million from funds managed by Resurgence Asset
Management L.L.C., in exchange for preferred stock and $30
million from a common stock rights offering underwritten by
Resurgence. The rights offering closed on November 29, 2002.

After deducting unpaid restructuring expenses, Sterling now has
net debt of less than $20 million, down from approximately $1
billion when it filed for bankruptcy protection in July 2001.
Sterling's new debt consists primarily of approximately $94
million of new senior secured notes issued under its plan of
reorganization. In addition to cash on hand exceeding $80
million, Sterling has obtained a $100 million revolving credit
facility led by The CIT Group/Business Credit, Inc., which is
undrawn except for outstanding letters of credit.

At emergence, Sterling sold its pulp chemicals business to
Superior Propane Inc. for a gross purchase price of US$375
million, which resulted in net cash proceeds of approximately
US$358 million after debt retirement and payment of expenses and
after giving effect to certain closing adjustments. In a
separate transaction, Sterling disposed of its acrylic fibers
business for nominal consideration in accordance with the Plan.

As previously reported, the Plan was confirmed by the United
States Bankruptcy Court for the Southern District of Texas on
November 20, 2002, with the approval of an overwhelming majority
of its voting creditors. The reorganization cancelled all pre-
bankruptcy debt and equity of Sterling. The Company has
initiated the distribution, in accordance with the distribution
procedures provided in the Plan, of (i) a combination of cash
and new debt securities to the holders of Sterling's old senior
secured bonds and (ii) a combination of new common stock and
warrants to its unsecured creditors with allowed claims. Pre-
bankruptcy preferred and common shareholders received no
distribution under the Plan.

Sterling also announced that its Board of Directors has been
reconstituted in accordance with the Plan. The new directors
include James B. Rubin, Robert T. Symington, Byron J. Haney,
Marc S. Kirschner and Keith R. Whittaker, all of Resurgence;
Ronald A. Rittenmeyer, Chairman, CEO and President of Safety-
Kleen, Incorporated; and John Gildea, a Managing Director and
Principal of Gildea Management Company. Continuing as directors
are David G. Elkins and Richard K. Crump, Co-CEOs of Sterling.

Commenting on the emergence, Mr. Elkins, stated, "We are very
pleased with the outcome of our restructuring process. Our new
capital structure is designed to support the company over the
long-term, including during recurring cyclical downturns in the
markets for our petrochemicals products. We believe the steps we
have taken to strengthen our balance sheet and improve liquidity
have put Sterling on solid footing for the future. This
achievement is a testament to the hard work and dedication of
the great team at Sterling. We are gratified that our new
investors and business partners were able to come together to
support our business. We are also very appreciative of the
support provided by our customers, suppliers and employees
during this critical time. Finally, we are grateful for the
support of the members of our outgoing board of directors."

Mr. Crump stated, "With the reorganization completed, all of us
at Sterling are looking forward to turning our full attention to
enhancing profitability. We have a world-class manufacturing
facility and a dedicated, proven workforce. We are well-
positioned to implement our business strategy and to become a
much stronger competitor in the petrochemicals industry. We are
committed to maintaining a strong capital structure as well as
continuing to improve our cost structure and our reliability as
a supplier of goods and services to our customers and business
partners. Our management team and employees are excited by the
opportunity to be a part of the new Sterling."

Paul G. Vanderhoven, Sterling's Chief Financial Officer, said,
"We have significantly improved our balance sheet, liquidity and
capital resources. We have substantial flexibility in planning
for, or reacting to, chemical market disruptions, changes in the
petrochemicals industry, the economy and the financial markets.
The $60 million equity investment, combined with the $80 million
in cash we retained from the sale of our pulp chemicals
business, has given us a positive cash balance of more than $80
million. This, together with our new revolving credit facility,
provides us with over $100 million of liquidity and represents a
significant base of financial stability going forward."

As a result of the sale of its pulp chemicals business and
acrylic fibers business under the Plan, Sterling's business
operations will focus on manufacturing and distributing
petrochemicals from its facilities at Texas City, Texas.
Concurrent with its emergence, Sterling adopted the principles
of fresh-start accounting, which for financial purposes creates
a new entity and adjusts all historical assets and liabilities
to their respective fair values. Sterling also has elected to
change its fiscal year end from September 30 to December 31,
starting in 2003. As a consequence of the foregoing, Sterling's
financial results for periods subsequent to emergence from
bankruptcy generally will not be comparable to its financial
results for the same periods prior to that date.

Copies of the Plan and Sterling's Disclosure and most recent
annual Report on Form 10-K are posted on, or may be accessed
through, Sterling's Web site at http://www.sterlingchemicals.com

Based in White Plains, New York, Resurgence is a leading global
private investment firm with approximately $1.3 billion in
assets under management.


UNIFAB INTL: Annual Shareholders' Meeting to Convene on Dec. 27
---------------------------------------------------------------
A Notice of Annual Meeting of Shareholders of UNIFAB
International, Inc. has been mailed to the Company's
shareholders.  The meeting is to be held December 27, 2002,
10:00 A.M. C.D.T., at 5007 Port Road, New Iberia, Louisiana.

Purposes:       To consider and vote upon the following
                proposals and to ransact such other business as
                may properly come before the annual meeting:

                1.   To amend the Articles of Incorporation to
                     declassify the Board of Directors and
                     require the annual election of all
                     directors;

                2.   To elect eight directors to serve until the
                     2003 annual meeting or until their
                     respective successors are duly elected and
                     qualified, in the event Proposal One is
                     approved at the annual meeting;

                3.   Alternatively, to elect two Class II
                     directors to serve until the 2005 annual
                     meeting or until their respective
                     successors are duly elected and qualified,
                     in the event Proposal One is not approved
                     at the annual meeting;

                4.   To ratify the appointment of Deloitte &
                     Touche LLP as independent auditors to audit
                     the financial statements for 2002; and

                5.   To amend the long-term incentive plan.

                          *   *   *

As previously reported, Ernst & Young LLP, the accounting firm
that has been the independent auditor of UNIFAB International,
Inc., since its initial public offering in 1997, resigned from
its engagement with the Company, effective August 15, 2002. E&Y
notified the Company of its resignation on August 13, 2002.

In its report on the Company's audited financial statements for
the year ended December 31, 2001, E&Y modified its audit opinion
by noting that there was substantial doubt about the Company's
ability to continue as a going concern through the 2002 fiscal
year. This modification was the only qualification or
modification expressed by E&Y in their audit opinions during its
five-year engagement as the Company's independent auditor.


UNITED AIRLINES: Will Honor Prepetition Customer Obligations
------------------------------------------------------------
United Airlines sought and obtained permission to honor its
prepetition customer obligations.  James H.M. Sprayregen, Esq.,
at Kirkland & Ellis, tells the Court that airlines routinely
offer travel to many of the same locations as their competitors.
This competition makes retaining loyal customers and attracting
new customers important. Without winning and preserving the
loyalty of its customers, the Debtors' businesses could not be
maintained. It is essential that the Debtors maintain their
current customers through this difficult period and position
themselves to attract new customers.

1. Ticketholder Claims

The Debtors seek authority to honor all tickets for airline
travel that were purchased prepetition but have not yet been
used by providing the agreed upon air transportation. In
addition to tickets that are purchased by customers through
traditional channels, the Prepetition Tickets also include those
sold under the Senior Programs, the Pass Plus Program, the
Charter Sales Program and the Mileage Plus Program.

The Debtors established a promotion for senior citizens that
provides them with certain benefits, called the Silver Wings
Program. The Silver Wings Program is a membership club whose
members pay a fee in exchange for discounted travel on the
Debtors' airlines and other partners, including rental cars and
hotels. The Debtors' obligations under the Silver Wings Program,
which are ongoing, include discount certificates and guaranteed
air fares.

The Debtors also offered coupon books to seniors, the Senior
TravelPac. The Senior TravelPac allowed seniors to purchase
coupons at a fixed rate that are redeemable for two round trips.
Although the Senior TravelPac has been discontinued, there are
still outstanding coupons that could be redeemed through July
15, 2003.  Senior citizens are amongst the Debtors' most loyal
customers. If the Debtors are not allowed to honor prepetition
obligations of the Senior Programs, customer confidence and
goodwill among senior citizen travelers will be severely harmed,
and the Debtors will lose a valuable customer base.

The Debtors also have a program for individuals and small
businesses to purchase miles in advance, which may then be
debited when the individual or company elects to travel. This
program is an important tool for the Debtors' core business
traveler customer base.

The Debtors also offer charter services to, among others,
Leisure Travel Operators, sports teams, dignitaries and media
groups. The Debtors' generate millions of dollars in annual
revenue through the Charter Sales Program. Given the nature of
the business, the Debtors have made commitments and received
deposits for charter services through 2003. If the Debtors were
not allowed to honor these ticket sales, long-standing
relationships with these customers would be irreparably damaged,
and the Debtors would lose a proven revenue base.

Similarly, the Debtors must be able to honor any and all
prepetition transportation orders, miscellaneous charge orders,
vouchers, coupons, travel certificates, upgrade award
certificates, Universal Air Travel Plan credits and other
authorizations for travel and other services. These
authorizations are, from time to time, issued by the Debtors as:
(a) compensation for late, canceled or overbooked flights, (b)
part of the Debtors' promotional programs, (c) part of a tour
package and (d) in lieu of cash payments.

The Debtors also request authority to issue refunds on tickets
purchased prior to the Petition Date. To remain competitive with
other carriers and to retain the goodwill and confidence of
their customers and travel agents, it is extremely important
that the Debtors continue to issue refunds with respect to those
tickets originally sold as refundable. From January, 2002
through September, 2002, the Debtors refunded 2,443,643 coupons
totaling $638,444,464.13 in sales to customers. The average
refund value for this time period was $261.27.

2. Mileage Plus Program

In May 1981, the Debtors created a frequent flyer program named
Mileage Plus whereby members may earn miles, which may be
redeemed for travel on United Airlines or other affiliated
airlines or for other awards. The Mileage Plus miles may be
earned by purchasing the Debtors' airline tickets or tickets
from other reciprocal airlines and by purchasing goods and/or
services from or through various Mileage Plus partners,
including, among others, First USA Bank, iDine, Sprint, Nextel,
Safeway and numerous hotel and car rental companies. The Mileage
Plus partners purchase miles from the Debtors, which they
ultimately provide to their customers. These Mileage Plus miles
are then redeemed for travel awards. Frequent flyer programs
like Mileage Plus have been adopted by most major air carriers
and are considered the preeminent marketing tool for developing
brand loyalty among travelers and accumulating demographic data
pertaining to business flyers. Frequent flyer programs are
essential to building and maintaining a loyal customer base,
especially among business travelers, who pay higher fares than
leisure travelers. Over forty million customers have enrolled in
Mileage Plus since its inception.

Honoring Mileage Plus obligations rarely involves any
appreciable cash expense of the Debtors' estates. Rather, a
majority of the Mileage Plus participants who redeem mileage
credits receive only air transportation from the Debtors on
flights that would operate in any event, or other related
services from certain other participants in Mileage Plus. Most
of the Mileage Plus miles are awarded for travel with inventory
controls, which keeps displacement of revenue passengers at a
minimum. The Debtors' costs of providing service to the award
recipient are limited to incremental costs, such as fuel, food
and ticketing costs for what would otherwise be a vacant seat.

According to Mr. Sprayregen, the Debtors cannot compete
successfully against other major airlines unless they are able
to maintain the integrity of Mileage Plus. Failure to honor the
obligations of Mileage Plus will alienate the Debtors' best and
most loyal customers and thereby severely harm the Debtors'
competitive position and their reorganization efforts.

3. Leisure Sales Programs

Within the leisure travel market, the Debtors have positioned
themselves as a high-quality, competitive-fare carrier. The
Debtors offer air transportation through third parties which is
"incorporated" into Debtors' branded and unbranded vacation
packages to the leisure traveler. The Debtors generate millions
of dollars in annual revenue as a result of selling their
services together with other travel components (for example,
rental car, cruise, hotel, tours) as a total package to
consumers through Leisure Travel Operators, including, but not
limited to, Mark Travel, Collette Vacations, Far & Wide Travel
Corp., Globus and Cosmos and Grand Circle Travel. The Leisure
Travel Operators distribute the packages through retail travel
agents, or in some cases directly to the consumer.

The Debtors receive all of the proceeds from tour package sales.
In exchange, the customer receives the Debtors' airline tickets
and vouchers known as Leisure Sales Obligations issued by the
Leisure Travel Operators.

4. Barter Arrangements

The Debtors maintain barter arrangements with a number of
organizations that provide varied services and support to the
Debtors' operations in return for the Debtors providing air
transportation. The range of services provided to the Debtors
includes advertising, sales promotion, public relations and
other professional consulting services. The Debtors seek
authority to honor prepetition obligations related to the Barter
Arrangements and to continue to honor these Barter Arrangements
in the ordinary course of business. The Debtors believe that the
amount of unredeemed air transportation obligations related to
barter arrangements as of September 30, 2002 is approximately
$6.7 million.

5. Red Carpet Club Program

The Debtors offer their customers memberships in the Red Carpet
Club, which provides access to the Debtors' private lounges and
lounges owned by other carriers with which the Debtors' have a
reciprocal agreement. Memberships to the Red Carpet Club are
purchased from the Debtors. The Red Carpet Club Program offers
unique advantages to its members, which include the Debtors'
most frequent travelers. If the Debtors were unable to honor
their prepetition obligations to the Red Carpet Club Members or
maintain this program, they would jeopardize the confidence and
goodwill of their most valuable customers. Further, if the
Debtors were unable to allow reciprocal carriers' passengers to
utilize the Debtors' private first-class lounges, the Debtors'
passengers would similarly be denied access to the reciprocal
carriers' private first-class lounges.

6. Corporate Incentive Programs

The Debtors' Corporate Incentive Programs provide incentives to
participating corporations based upon the volume of tickets
purchased from the Debtors. The Corporate Inventive Programs,
include corporate volume agreements, the Perks Plus program and
global volume agreements. The incentives earned by the
corporations are either cash rebates or travel credits. The
greater the number of purchases, the larger the incentives to
the corporations. Therefore, corporations are encouraged to
purchase more travel tickets from the Debtors to obtain greater
incentives, which results in larger net revenue for the Debtors.
The average amount paid in cash per month under the Corporate
Incentive Programs over the last twelve months is approximately
$5.6 million.  Many corporate customers are approaching the
level of purchases that would trigger an incentive or a larger
incentive. Further, there may be corporations that have earned
incentives that have not yet been paid by the Debtors. If the
Court were not to grant the relief requested, participating
corporations would lose any incentives or credit for their
prepetition purchases of the Debtors' tickets, likely resulting
in these corporations refusing to purchase future tickets from
the Debtors, while initiating a business relationship with the
Debtors' competitors.

To the extent the Debtors are unable to continue the Corporate
Incentive Programs, the Debtors risk alienating and losing
market share to competing airlines which have every incentive to
engage in predatory behavior to "poach" the Debtors' most
valuable customers, all to the detriment of the Debtors, their
creditors and their estates. Therefore, it is in the best
interests of the Debtors, their estates, and their creditors to
honor prepetition obligations of the Corporate Incentive
Programs and to continue the Corporate Incentive Programs as
they see fit in the ordinary course of business.

7. The Cargo Programs

The Debtors instituted several programs for the benefit of their
cargo customers, including, but not limited to: (a) Premier
Partner Cargo Program whereby select air freight forwarders in
the United States and overseas receive commissions and tickets
for reaching prescribed sales goals; (b) a Domestic Cargo
Incentive Programs, similar to the Premier Partner Cargo
Program, whereby select air freight forwarders within the United
States earn invoice credits for reaching prescribed goals; (c)
International Cargo Incentive Programs for air freight
forwarders outside of the United States to earn rebates,
including cash payments and space on United Airlines flights,
for reaching prescribed sales goals; and (d) a program whereby
the Debtors provide same day, door-to-door cargo transport
service to existing commercial customers, called the United
SameDay/SameDay Plus Programs.

Freight customers account for an excess of $680 million in
annual revenue. A large portion of this revenue is generated as
a result of the Cargo Programs, which encourage freight
forwarders and other customers to use the Debtors' Cargo
Services. Confidence and goodwill among freight forwarders and
customers, as well as revenues, will be severely harmed if the
Debtors are prevented from honoring prepetition commissions and
other awards earned under the Cargo Programs. As of the Petition
Date, many articipating freight forwarders have generated
significant revenue for the Debtors to reach the forwarders'
sales goals. Many forwarders were approaching a revenue level
that would trigger additional commissions. If the Court were not
to grant the relief requested, participating customers would
lose any revenue credit for their prepetition business, which
would likely result in those freight forwarders avoiding the
Debtors in the future. Additionally, if the United
SameDay/SameDay Plus Program discounts and any other prepetition
obligations under the United SameDay/SameDay Plus Programs are
not honored, it is likely that the Debtors' customers will no
longer use the Debtors for their shipping needs and instead look
to the Debtors' competitors.

Mr. Sprayregen says that the filing of the Chapter 11 Cases may
negatively affect customers' attitudes and behavior toward their
services unless they can take the measures requested by this
Motion to disperse that shadow. In particular, the Debtors'
goodwill and ongoing business relationships may erode if their
customers perceive that the Debtors are unable or unwilling to
fulfill the prepetition promises they have made through the
Customer Programs. The same would be true if customers perceived
that the Debtors will no longer be offering the types of
services or quality of services they have come to expect and
rely upon. Further, the Debtors' competitors will likely
increase their efforts to lure away customers and to create
doubts as to the Debtors' ability to successfully emerge from
Chapter 11. (United Airlines Bankruptcy News, Issue No. 2;
Bankruptcy Creditors' Service, Inc., 609/392-0900)


UNITED AIRLINES: Unsec. Committee Taps Sonnenschein as Counsel
--------------------------------------------------------------
The Official Committee of Unsecured Creditors of UAL
Corporation, appointed Friday, Dec. 13, 2002, selected
Sonnenschein Nath & Rosenthal as counsel for the Committee.
Carole Neville and Fruman Jacobson of Sonnenschein will lead the
representation.

In addition, KPMG Corporate Recovery Group was retained as
accountant to the Committee. Larry Laddig of KPMG is the
engagement partner.

Both retentions are subject to approval by the Bankruptcy Court
in Chicago.

The Creditors' Committee is comprised of 13 creditors: Pension
Benefit Guaranty Corp., the Association of Flight Attendants,
the Air Line Pilots Association (ALPA), the International
Association of Machinists, The Bank of New York, Airbus North
America, Pratt & Whitney, HSBC Bank USA, US Bank National
Association, R Squared Investments, Deutsche Lufthansa, Goodrich
Corp. and Galileo International. The City of Chicago and the San
Francisco Airport Commission are ex officio members.

The Committee chose Airbus as chair, with ALPA and The Bank of
New York as vice-chairs.


US AIRWAYS: Files Chapter 11 Plan and Disclosure Statement
----------------------------------------------------------
US Airways Group, Inc., filed its Disclosure Statement and Plan
of Reorganization with the U.S. Bankruptcy Court on Friday
evening, keeping the company's "fast-track" voluntary Chapter 11
reorganization on schedule, and putting in motion a timeline for
the nation's seventh-largest airline to emerge from Chapter 11
protection as early as March 2003.

"We have achieved unprecedented results on all fronts thus far,
and are on-track to reduce operating costs by more than $1.8
billion annually. As the entire industry grapples with
restructuring, our efforts will ensure that we emerge from
Chapter 11 protection as a very efficient airline with
competitive labor, fleet and operating costs," said David
Siegel, US Airways president and chief executive officer. "The
support of our customers and the cooperation of our employees
and labor union leaders, as well as our lenders, lessors and
vendors, have allowed us to use this process to lay the
groundwork for our future success."

The company said that the capital structure and distributions
included in the Plan were negotiated consensually with the
company's Official Committee of Unsecured Creditors and the
Retirement Systems of Alabama -- the airline's Debtor-in-
Possession lender and its proposed equity sponsor. Both groups
are expected to formally endorse the Plan at or prior to the
hearing on the adequacy of the Disclosure Statement that has
been scheduled for Jan. 16, 2003, in the Bankruptcy Court.

"The management team and employees of US Airways continue to
impress us with their professionalism, vision and commitment to
a successful restructuring," said Dr. David Bronner, the chief
executive of RSA. "As recently as this week, we have held high-
level discussions with the airline's leadership and reiterated
our commitment to the company. The agreements recently reached
with its labor unions for additional cost and productivity
savings demonstrate to us that there is a dedicated workforce
that will pull the company through and who will benefit from the
future success of their airline."

The Disclosure Statement and Plan were filed in the United
States Bankruptcy Court for the Eastern District of Virginia,
where the Honorable Stephen S. Mitchell is presiding over the
case. Court approval of the adequacy of the Disclosure Statement
on Jan. 16, 2003, will allow US Airways to commence solicitation
of votes for confirmation of the Plan by its creditors in late
January and for the Bankruptcy Court to conduct a plan
confirmation hearing by late March.

Key elements of the Plan, as proposed, and subject to approval
by the Bankruptcy Court include:

     -- The company must secure final approval of the federal
guarantee from the Air Transportation Stabilization Board for a
$1 billion loan, to be used as exit financing upon emergence and
close its investment agreement with RSA.

     -- The company must implement the additional labor cost
savings agreements reached with all of the airline's unions (to
date, the Air Line Pilots Association has ratified its
agreement, with others expected over the next two weeks).

     -- The company must resolve a pension funding liability
estimated at $3.1 billion over the next seven years. The company
continues to explore options to lower its pension expense.

-- As previously disclosed, the plan assumes that the
existing common stock of the parent company will be cancelled.

-- RSA will invest $240 million upon emergence, and will
hold the lead investor position in the company with a 36.6
percent stake (on a fully diluted basis). The remaining stock
will be divided among the Unsecured Creditors (10.5 percent);
the ATSB (10.0 percent); General Electric (5.0 percent); members
of the Air Line Pilots Association (19.3 percent); other
employees (10.8 percent) and management (7.8 percent).

-- A newly-reconstituted 15-member Board of Directors will
be appointed, to include eight nominees selected by RSA, four
representatives of US Airways union groups (the Air Line Pilots
Association, the International Association of Machinists, the
Association of Flight Attendants/Transport Workers Union, and
the Communications Workers of America), CEO David Siegel, and
two independent directors nominated by the company in
consultation with the Committee of Unsecured Creditors.

     -- Valuations included in the Disclosure Statement estimate
the value of the total common equity and warrants of the
reorganized US Airways in the range between $425 million and
$645 million.

     -- On a consolidated basis, claims aggregating
approximately $61 billion were filed against the company. While
there can be no assurance that the company will be successful in
its claims administration process, the company estimates that
claims will finally be allowed in the range of $2.1 to $2.2
billion for secured claims and $2.5 billion to $3.1 billion for
unsecured claims. Holders of allowed secured and priority claims
are estimated to recover their full allowed claims while
recoveries to general unsecured claims are estimated to be in
the range of 1.6 percent to 2 percent of their allowed claims.

     -- The planned emergence of some or all of the company's
subsidiaries is not necessarily tied to the planned March 2003
emergence of US Airways. Prior to emerging, the wholly owned
regional air carriers must reach agreements with their
respective labor unions on competitive labor contracts that will
allow for the transition to an all-regional jet fleet at each of
the subsidiaries.

The filing does not address specifics as to which airport or
aircraft leases or other executory contracts will be assumed or
rejected. These and other details will continue to be the
subject of negotiations and finalization over the next several
months. The company's present intention is to file its plan
exhibits in the Bankruptcy Court with information relating to
assumption or rejection of executory contracts and other matters
in early March 2003, in advance of the proposed voting deadline
on the reorganization plan.

The filing also included a detailed "liquidation analysis" -- a
required element of the Disclosure Statement -- which concludes
that the airline's creditors and the overall value of the
company's estate would be better served if US Airways completes
a successful restructuring and remains an on-going enterprise of
which creditors would be given stock in the company in exchange
for unpaid claims.

"The restructuring process has presented us with many
challenges, and needless to say, many sacrifices have been
made," said Siegel. "Despite having to work to get more cost
savings than originally anticipated because of the industry's
prolonged downturn, I am actually more optimistic than ever
about our prospects."

US Airways is the nation's seventh-largest airline, serving more
than 200 communities in the U.S., Canada, Mexico, the Caribbean
and Europe. Most of its route network is concentrated in the
eastern U.S., where it is the largest air carrier east of the
Mississippi. It employs approximately 33,000 people and operates
a fleet of 279 mainline jet aircraft. US Airways and its US
Airways Express partner carriers operate more than 3,400 flights
per day.

The company filed for Chapter 11 protection on Aug. 11, 2002,
after the impact of the September 11 terrorist attacks led to
almost $2 billion in losses in the subsequent four quarters of
operation. It is the only major U.S. airline to receive
unanimous conditional approval of the federal loan guarantee
from the ATSB, and its restructuring efforts have been described
by airline industry analysts in very positive terms with regard
to the company's commitment to long-term success and positive
labor-management relations. Since filing for Chapter 11
protection, US Airways has implemented schedule changes which
have preserved service to virtually all of the communities in
its route network and has been at the top of the U.S. Department
of Transportation monthly customer service reports.


US AIRWAYS: AAU Wants Stay Relief to Recover Trust Funds
--------------------------------------------------------
Associated Aviation Underwriters, Inc., is the sole beneficiary
of trust funds established as security for payments owed by US
Airways, Inc., pursuant to prepetition Premium Payment
Agreements and a Trust Agreement dated August 20, 1991.

H. Jason Gold, Esq., at Wiley, Rein & Fielding, tells Judge
Mitchell that US Airways is in default of its payment
obligations under the PPAs.  Under the express terms of the PPAs
and the Trust Agreement, AAU is entitled to all Trust Funds to
satisfy unpaid workers' compensation insurance premium
obligations. Therefore, AAU seeks relief from the automatic stay
to obtain the Trust Funds.

US Airways executed insurance policies with AAU on September 1,
1987, September 1, 1988, and September 1, 1989, covering
workers' compensation claims.  On the same dates, AAU and US
Airways executed the PPAs.  The PPAs established a billing
schedule and provided for "true-ups" of premiums based on the
actual losses paid under each Policy.

The PPAs require US Airways to maintain the Trust Funds in a
specified amount "as security for payment of all premiums which
may become payable" under the PPAs.

In 1991, US Airways and AAU also entered into the Trust
Agreement, which requires US Airways to provide cash and/or
securities to a designated Trustee, as "security for the
performance by [US Airways] of its obligations under the Premium
Payment Agreements."  These assets are provided for "the sole
use and benefit" of AAU.  Pursuant to the PPAs and the Trust
Agreement, US Airways transferred the Trust Funds in trust to
the Trustee, which established a trust account for AAU's
benefit.

The PPAs provide that US Airways will be in default if it fails
to pay the full amount of any bill within 31 days after payment
is due or in the event that US Airways files for bankruptcy.  US
Airways is in default of its premium true-up payment obligations
to AAU for $7,836,769 as of June 24, 2002.  The Trust Funds had
a value of $4,101,713 as of July 31, 2002.

According to Mr. Gold, cause exists to permit AAU to recover the
Trust Funds because the Debtors' interests in the property have
no discernable value to the estate.  Permitting AAU to recover
the Trust Funds will not impact the estate, creditors or
property available to creditors for distribution or to the
debtors for operations.  US Airways has no right to the Trust
Funds unless and until all unpaid premiums are paid in full.
AAU is not seeking to liquidate or recover the unsecured balance
of its claims against US Airways for unpaid insurance premiums.

At most, US Airways has a de minimis legal interest in the
trust, but no legal or equitable interest in the Trust Funds.
US Airways is entitled only to receive income generated from the
Trust Funds and to direct investment of the Trust Funds within
authorized guidelines.  However, with respect to the Trust Funds
themselves, US Airways holds at most a contingent, reversionary
interest that will attach only if and to the extent that the
Trust Funds exceed US Airways' liability to AAU for unpaid true-
up premiums.  However, US Airways' reversionary interest could
never attach, because the Debtors' liabilities to AAU for
premium true-up payments far exceeds the balance of the Trust
Funds.

Mr. Gold asserts that AAU is entitled to withdraw and retain all
Trust Funds to satisfy any unpaid and overdue premium payments
in the event of US Airways' default under the PPAs.  Similarly,
the Trust Agreement provides that AAU may direct the Trustee to
disburse the Trust Funds to AAU as reimbursement for the
Debtors' overdue premium payments in the event of US Airways'
default under a PPA.  Because US Airways has no right to the
Trust Funds unless it first pays its substantially larger
obligation to AAU, permitting AAU to recover the Trust Funds
imposes no burden on the estate.

By comparison, maintaining the automatic stay frustrates the
purpose of the Trust, preventing AAU from recovering more than
half of the overdue payments from US Airways under the PPAs from
a source that is beyond the reach of the Debtors and their
estates.  The only potential impact that relief from the
automatic stay could have on the Debtors would be to eliminate
the limited income generated by investment of the Trust Funds.
However, that income, approximately $4,000 per month, is de
minimis compared to US Airways' size.  More importantly, the
potential loss of that income is dwarfed by the harm to AAU from
a delay in recovering the Trust Funds portion of its $7,800,000
claim.  The mere fact that the Debtors earn income on an asset
that is not estate property and, even if it were, would be
entirely "under-water," is not grounds for maintaining the stay.

Mr. Gold continues that the Debtors cannot demonstrate that the
assets sought by AAU are essential for a successful
reorganization because it does not have access to the Trust
Funds unless and until all outstanding premiums are paid to AAU.
There is no point in US Airways using other cash to pay
$7,800,000 in unpaid premiums to free up Trust Funds worth only
$4,100,000. While US Airways is entitled to receive the income
from the Trust Funds, the amounts are only $4,000 per month.
For a company of US Airways' size, this amount of money is of no
significance to the success of its reorganization.  Accordingly,
the Trust Funds that AAU is seeking are not required for the
successful reorganization of US Airways or any of the other
Debtors. (US Airways Bankruptcy News, Issue No. 18; Bankruptcy
Creditors' Service, Inc., 609/392-0900)


US AIRWAYS: Reaches New Agreement with Training Instructors
-----------------------------------------------------------
The Transport Workers Union (TWU) of America, Local 547,
representing US Airways' 107 flight crew training instructors,
reached a tentative agreement on further cost- savings measures.

"As difficult as these concessions are for our members, we
believe that our contributions, like those of our colleagues,
will better position US Airways to emerge from Chapter 11 as a
much stronger and competitive carrier," said Bill Gray,
president of TWU Local 547.

"Every agreement with our labor groups brings us that much
closer to a successful reorganization and we are grateful that
the TWU's flight crew training instructors have taken this
action to support our restructuring," said Jerry A. Glass, US
Airways senior vice president of employee relations.

US Airways continues to have productive discussions with its
other unions on further cost reductions.

Last week the Air Line Pilots Association's (ALPA) Master
Executive Council ratified its cost-cutting agreement and
yesterday, the Communications Workers of America (CWA), and the
TWU's dispatchers and simulator engineers reached tentative
agreements on the restructuring. The other unions representing
US Airways employees are the International Association of
Machinists (IAM) - mechanics and related workers; IAM - fleet
service workers; and Association of Flight Attendants (AFA).


VIASYSTEMS: Court Extends Lease Decision Period Until Feb. 28
-------------------------------------------------------------
By order of the U.S. Bankruptcy Court for the Southern District
of New York, Viasystems Group, Inc., and its debtor-affiliates
obtained an extension of their lease decision period.  The Court
gives the Debtors until February 28, 2003, to decide whether to
assume, assume and assign, or reject unexpired nonresidential
real property leases.

Viasystems Group, Inc., is a holding company whose principal
assets are its shares of stock of Viasystems, Inc.  Viasystems,
through its direct and indirect subsidiaries, is a leading,
worldwide, independent provider of electronics manufacturing
services to original equipment manufacturers primarily in the
telecommunication, networking, automotive, consumer, industrial
and computer industries. The Debtors filed for chapter 11
protection on October 1, 2002. Alan B. Miller, Esq., at Weil,
Gotshal & Manges, LLP represents the Debtors in their
restructuring efforts. When the Companies filed for protection
from its creditors, it listed $1.6 Billion in total assets and
$1.025 Billion in total debts.


WEIGHT WATCHERS: S&P's Keeps Watch on BB- Credit & Debt Ratings
---------------------------------------------------------------
Standard & Poor's placed its 'BB-' long-term corporate credit
and 'BB-' senior secured debt ratings on Woodbury, New York-
based Weight Watchers International Inc. on CreditWatch with
positive implications. The company's 'B' subordinated debt
rating was also placed on CreditWatch.

Total debt outstanding at Sept. 28, 2002, was about $452
million.

"The CreditWatch placement reflects the company's improving
financial profile and better-than-expected operating
performance, driven by increased classroom attendance and
product sales across most of its geographic segments," said
Standard & Poor's credit analyst David Kang.

Standard & Poor's will meet with management and review Weight
Watchers' operating and financial plans.

Weight Watchers is the largest provider of weight-control
programs in the world, operating in 30 countries through a
network of company-owned as well as franchised operations.


WHEELING-PITTSBURGH: Files Chapter 11 Reorganization Plan
---------------------------------------------------------
Wheeling-Pittsburgh Steel Corporation has filed its Plan of
Reorganization in United States Bankruptcy Court. Filing its
reorganization plan is the first step for the company as it
begins the process of emerging from Chapter 11 bankruptcy
protection.

Before Wheeling-Pittsburgh Steel's Plan of Reorganization can
become effective, it must be approved by the company's
creditors. The approval process is expected to be concluded
before the end of the first quarter of 2003. The Plan of
Reorganization is also contingent upon approval of the company's
$250 million loan guarantee application by the Emergency Steel
Loan Guarantee Board. The application was filed by Royal Bank of
Canada in September.

As part of its strategy to emerge from bankruptcy protection,
the company plans significant investments in state-of-the-art
technology that will reduce its overall cost structure and
increase its manufacturing flexibility. These changes will help
Wheeling-Pittsburgh Steel to better compete during both strong
and weak steel markets.

Wheeling-Pittsburgh Steel, the nation's eighth largest domestic
steel producer, filed for Chapter 11 bankruptcy protection in
November 2000.


WILLIAM CARTER: S&P Raises Credit Rating Up Two Notches to BB-
--------------------------------------------------------------
Standard & Poor's raised its corporate credit rating on Atlanta,
Georgia-based children's wear manufacturer The William Carter
Co., to 'BB-' from 'B+'. In addition, the bank loan rating was
raised to 'BB' from 'BB-'. Simultaneously, the subordinated debt
rating was raised to 'B' from 'B-'.

The ratings are removed from CreditWatch, where they were placed
on September 19, 2002. The outlook is stable.

Carter's had total debt outstanding of about $319 million at
September 28, 2002.

"The upgrade reflects the company's improving financial results
and related credit measures, which are a result of stronger
margins, increased outsourcing, and better cost controls," said
Standard & Poor's credit analyst Susan Ding. "Carter's sales
volumes and margins have increased each year, driven by
increased consumer spending on the infant and children's apparel
categories and favorable demographic trends. This top-line
improvement has translated into higher operating results as the
company continues to outsource its production to lower cost,
non-U.S. facilities."

The ratings incorporate Carter's leveraged financial profile,
which is partially offset by the company's leading positions in
the competitive infant and children's apparel industry, as well
as its distribution channel diversity.

Carter's is one of the largest manufacturers and marketers of
infants' and young children's apparel in the U.S., selling
products under the well-recognized Carter's and Carter's
Classics brand names. The company has leading market positions
in the layette, baby, and young children's sleepwear segments
and is also a strong competitor in young children's playwear.
Sales have increased at a 10% compounded annual rate since 1996
because of positive demographic trends and increased spending on
children's apparel. In addition, Carter's benefits from
retailers' current trend of using fewer vendors with well-known
brand names, those who can provide a broader array of products
and higher service levels.


WORLDCOM INC: Retains Joint Venture as Real Estate Consultant
-------------------------------------------------------------
Worldcom Inc., and its debtor-affiliates, sought and obtained
the U.S. Bankruptcy Court for the Southern District of New
York's authority to employ a joint venture consisting of Hilco
Real Estate LLC, Hilco Industrial LLC, New America Network Inc.
and NodeCom Inc. as consultants, in accordance with the terms of
a Consulting and Advisory Services Agreement, dated September
17, 2002.  The Debtors ask Judge Gonzalez to approve the Joint
Venture's employment nunc pro tunc to September 3, 2002.

Hilco is an industrial and commercial asset disposition firm
that has provided strategic services for distributors,
manufacturers, asset-based lenders, venture capitalists and
investment bankers. Hilco is also a leader in providing asset
disposition services to debtors in all industries, with
experience throughout the United States and Canada.  Hilco has
successfully marketed real estate in numerous bankruptcy cases
and out-of-court restructurings, including in Burlington
Industries, Hechinger, Heilig Meyer, Sportmart, Cherins, Sun TV,
Filene's Basement, Trak Auto, Homeland, Paul Harris, MSOP and
McWhorter's.

Additionally, NodeCom, who will assist in the disposition of the
Debtors' property, has been retained as real estate consultant
in these matters: 360 Network, Inflow, ICG, Colo.Com, ANS
Network Services, Intermedia Communications, Level 3, and e-
spire.

New America is a real estate broker in a number of states and
provides commercial real estate service through an international
system of commercial real estate service providers.

The members of the Joint Venture provide different but
complementary services.

                    Services to be Rendered

Joint Venture will provide consulting and advisory services to
the Debtors in connection with the valuation of certain owned
and leased properties, machinery, equipment, furniture and
fixtures.  The Joint Venture will also negotiate advantageous
sale or assignment agreements for Properties and the furniture,
fixtures and equipment, and landlord claim and rent reduction
agreements for the Leases.  In addition, the Joint Venture will:

   1. meet with the Debtors and its advisors to ascertain
      goals, objectives and financial parameters with respect to
      the engagement;

   2. develop a marketing strategy for the Owned Properties,
      the Leases and the FF&E in coordination with the Debtors'
      restructuring plans, and implement the marketing strategy
      after it has been approved by the Debtors;

   3. where appropriate and in conjunction with the Debtors,
      coordinate and organize the due diligence review,
      bidding, auction and sale processes in order to maximize
      the attendance of all interested bidders for the sale and
      assignment of Properties;

   4. at the Debtors' direction and on their behalf, with the
      assistance of their advisors, negotiate agreements for
      the sale and assignment of Properties;

   5. at the Debtors' direction and on their behalf, with the
      assistance of their advisors, negotiate agreements with
      landlords in connection with Leases;

   6. handle the disposition of the FF&E located at the
      Properties;

   7. report periodically to the Debtors and their advisors
      regarding the status of negotiations;

   8. participate in weekly conference calls and other periodic
      calls and meetings with the Debtors and their advisors to
      discuss disposition of the Properties; and

   9. provide any other services as requested by the Debtors
      from time to time.

                    Professional Compensation

The Debtors have agreed that fees for the services rendered in
these cases will be:

A. Valuation Services:  As compensation for the Joint Venture's
   services, the Debtors will pay the Joint Venture a fee for
   the valuation of the Properties and the associated FF&E at
   $100 per Lease and $1,000 per Owned Property.  The Valuation
   Fee will be credited 100% against Commission Fees earned in
   connection with the disposition of each of the valued
   Properties, including any fees earned from reduction of
   claims from lease rejection.  The Valuation Fee will be due
   and owing to the Joint Venture as of the time of a final
   order of the Bankruptcy Court approving:

   1. a sale/assignment, rent reduction and landlord claim
      reduction agreement, or

   2. a Lease rejection.

   To the extent that the Debtors ask the Joint Venture to
   provide MAI appraisals of any Property, the Joint Venture
   will charge and the Debtors will pay the Joint Venture's
   standard fee for these appraisals as mutually agreed by the
   Debtors and the Joint Venture; provided, however, that the
   standard fee for these appraisals will be comparable with
   competitive market rates and in no event will the fee exceed
   $25,000 without obtaining the Debtors' prior written
   approval.

B. Disposition of Owned Properties and Leases:

   1. Upon closing the sale of a Property, the Joint Venture
      will be deemed to have earned and the Debtors will pay
      Joint Venture a fee based on the total amount of cash
      received by the Debtors for these Properties in accordance
      with this sliding-scale structure:

         Gross Proceeds Per Property   Fee Percentage
         ---------------------------   --------------
               $0-$10 million               3.0%
              $10-$30 million               2.0%
              $30-$50 million               1.5%
            $50 million and over            1.0%

      Prior to the execution of the Agreement, the Debtors
      informed the Joint Venture that:

      -- offers exist with respect to certain Properties as the
         result of negotiations between the Debtors and a
         prospective buyer of the Property, and

      -- the Debtors' administrative building known as Pentagon
         City was to be sold to a prospective purchaser.

      The Debtors' goal may include signing a "stalking horse"
      bid as to one or more of the Prior Offer Properties.
      Since the execution of the Agreement, the Debtors have
      determined not to proceed with the sale of the Pentagon
      City Property under the agreement with the Initial
      Prospect.  Therefore, the Joint Venture's compensation for
      the disposition of this property will be based on these
      percentages.  With respect to Prior Offer Properties, the
      Debtors and the Joint Venture will mutually agree on the
      list of Prior Offer Properties and the reduction to the
      fee payable to the Joint Venture for the disposition of
      these properties.

   2. Upon obtaining any rent reduction under any Lease, Joint
      Venture will earn a commission equal to 3% of the net
      present value -- discounted at 7% -- of the pro-rata
      annualized occupancy cost reductions achieved as of the
      closing date of the renegotiated lease, which includes,
      gross savings from all future base rent, real estate
      taxes, CAM and other material savings.  In no event will
      the Joint Venture's fee for any rent reduction transaction
      be less than $5,000.

   3. For reductions of any landlord claim under Section
      502(b)(6) of the Bankruptcy Code with respect to any Lease
      rejected pursuant to Section 365, the Joint Venture will
      earn a fee for each Lease equal to the greater of:

      -- the Fixed Claim Reduction Fee, or

      -- the cash equivalent of a fee equal to 10% of the Claim
         Reduction Distribution Amount.

      A "Claim Reduction Agreement" will mean an agreement
      between the Debtors and a landlord providing for the
      reduction or waiver of the landlord's claim under Section
      502(b)(6) arising on account of the Debtors' rejection of
      a Lease.  The Fixed Claim Reduction Fee will be:

      -- $1,000 per Lease where the Claim Reduction Amount is
         less than $100,000,

      -- $3,000 per Lease where the Claim Reduction Amount is
         between $100,001 and $500,000,

      -- $4,000 per Lease where the Claim Reduction Amount is
         between $500,001 and $1,000,000, or

      -- $5,000 per Lease where the Claim Reduction Amount is
         greater than $1,000,000.

      The Claim Reduction Distribution Amount will be equal to
      the value of the pro rata distribution afforded to a
      general unsecured creditor holding a claim equal to the
      Claim Reduction Amount under a confirmed plan of
      reorganization for the debtor-lessee.  The Joint Venture
      will be paid any Fixed Claim Reduction Fee in full upon
      the order of the Bankruptcy Court approving the Claim
      Reduction Agreement having become a final order.  The
      Joint Venture will be paid Claim Reduction Fees, where
      applicable, within 10 business days of the effective date
      of a confirmed plan of reorganization for the applicable
      debtor-lessee.  Any payment of a Claim Reduction Fee for a
      Lease will be reduced by the amount of any Fixed Claim
      Reduction Fee paid on account of the Lease.

   4. Upon execution of a Lease in a Property where the
      Debtors act as landlord, the Debtors will pay the Joint
      Venture 3% of the aggregate value of lease commitment over
      the term of the Lease.

C. Disposition of the FF&E:

   The Joint Venture will be entitled to receive a fee equal to
   7% of the net proceeds from the sales of all FF&E located at
   the Properties and designated by the Debtors for sale.  For
   purposes of calculating this fee, "net proceeds" will mean
   gross proceeds minus sales taxes.  Additionally, the Joint
   Venture will be entitled to charge purchasers of FF&E a
   Buyer's premium of 10% for FF&E that is auctioned by the
   Joint Venture, it being understood that the premium will be
   in addition to, and will not be deducted from, sale proceeds,
   and that the Debtors bear no obligation or liability to the
   Joint Venture with respect thereto.  No buyer's premium will
   be charged for items that are not auctioned.  As requested by
   the Debtors, the Joint Venture will prepare budgets for all
   out-of-pocket expenses associated with the proposed
   disposition and removal of the FF&E.  Any and all budgets for
   the FF&E Expenses will be subject to the approval of the
   Debtors.  All FF&E Expenses will be borne by the Debtors.  To
   the extent that the Joint Venture incurs any FF&E Expenses in
   connection with an approved budget, the Joint Venture will be
   reimbursed by the Debtors for any FF&E Expenses.  Billing for
   these FF&E Expenses will be monthly and payment is due not
   later than 30 days after the date of invoice.  The Joint
   Venture is authorized only to negotiate the terms of the sale
   of any specified FF&E at the direction and on the behalf of
   the Debtors, with the assistance of the Debtors' advisors,
   but not to commit the Debtors to any agreement or arrangement
   or to sign any instrument on behalf of the Debtors.  No
   auction of any FF&E will be held except as authorized by the
   Debtors.  To the extent approved by the Debtors and
   authorized by the Bankruptcy Court, the Joint Venture will be
   entitled to abandon any unsold FF&E at the Properties.  For
   FF&E that the Joint Venture performs a valuation, in the
   event that there is a disposition assignment during the term
   of this agreement for the FF&E, the Joint Venture will be
   utilized for the disposition assignment under the terms of
   the Agreement.

The Joint Venture also will seek reimbursement for reasonable
out-of-pocket expenses, including reasonable expenses of travel
and transportation, telephone charges, postage, courier fees,
and fees for expert witness testimony, which will be billed at
the Joint Venture's standard rates at $250 to $400 per hour.
(Worldcom Bankruptcy News, Issue No. 15; Bankruptcy Creditors'
Service, Inc., 609/392-0900)


* Cadwalader Names Tom Fini & Richard Gregorian as New Partners
---------------------------------------------------------------
Cadwalader, Wickersham & Taft, one of the world's leading
international law firms, has elected Tom M. Fini and Richard
Gregorian as Partners of the firm.

"We are pleased to welcome these two outstanding attorneys to
the partnership, further evidence that Cadwalader continues to
grow in strength on both sides of the Atlantic. Their efforts,
along with those of the entire firm, have resulted in yet
another successful year for Cadwalader," said Robert O. Link,
Jr., Cadwalader's Chairman. "It is a great pleasure to
congratulate them today and we look forward to their continued
success and contributions to the firm in years to come."

The following attorneys were elected Partner:

     -- Tom M. Fini, an attorney in the New York Litigation
Department, focuses his practice on complex litigation matters
including corporate control litigation, securities fraud class
actions, corporate governance and fiduciary duty litigation, and
antitrust litigation and counseling. He received his B.A., magna
cum laude, from New York University, and his J.D., cum laude,
from New York University School of Law, where he received the
Edward Weinfeld Prize for distinguished scholarship in the area
of federal courts. Following law school, he served as a law
clerk to The Honorable Robert E. Cowen of the United States
Court of Appeals for the Third Circuit.

     -- Richard Gregorian, an attorney in the London Financial
Restructuring Department, focuses his practice on large scale
corporate restructurings and insolvencies with particular
expertise in bondholder restructurings and insurance
insolvencies. Richard also advises on all aspects of corporate,
banking and capital markets transactions. He received his LL.B.
from the University of Westminster, and achieved a First Class
Honours in his Law Society Finals at Lancaster Gate Law School,
where he received his law degree.

Cadwalader, Wickersham & Taft, established in 1792, is one of
the world's leading international law firms, with offices in New
York, Charlotte, Washington and London. Cadwalader serves a
diverse client base, including many of the world's top financial
institutions, undertaking business in more than 50 countries in
six continents. The firm offers legal expertise in
securitization, structured finance, mergers and acquisitions,
corporate finance, real estate, environmental, insolvency,
litigation, health care, global public affairs, banking, project
finance, insurance and reinsurance, tax, and private client
matters. More information about Cadwalader can be found at
http://www.cadwalader.com


* O'Melveny & Myers LLP Opens New Office in Beijing, China
----------------------------------------------------------
Continuing its global expansion, O'Melveny & Myers LLP announced
that the Chinese Ministry of Justice has granted the firm a
license to open a Beijing office. The Beijing office will
complement O'Melveny & Myers' thriving practices in Shanghai,
Hong Kong, and Tokyo.

In addition, the firm announced that Howard Zhang, an
accomplished international attorney and former diplomat with the
Chinese government, has joined O'Melveny & Myers as a partner.
Partner Patrick M. Norton, previously with the firm's Shanghai
office, will head O'Melveny & Myers' practice in Beijing. Norton
is a former U.S. State Department lawyer and a well-recognized
expert in both public and private international law. Both Norton
and Zhang are now based in Beijing.

"We are already the leading international firm in Shanghai, and
Beijing will strengthen our hand as a leading China practice,"
said Mr. Arthur B. Culvahouse, Chairman of O'Melveny & Myers.
"We see great advantage in being one of the few major U.S. law
firms with a strong network of offices in Asia's two most
important markets, China and Japan."

Before entering the World Trade Organization last year, China
limited foreign law firms to offices in one city. As part of its
new WTO commitments, China agreed to open its legal services
market by permitting foreign law firms to operate in additional
cities. In 1996 O'Melveny & Myers was one of the first foreign
law firms licensed to operate in Shanghai. The new Beijing
license makes it one of the first to benefit from China's new
WTO policies by having offices in both Beijing and Shanghai,
China's political and commercial centers.

The new office of O'Melveny & Myers in Beijing will open with a
team of 10 lawyers and a number of business professionals.

"A great deal of our work in China already takes place in
Beijing, so we are pleased to have an office from which we can
support our Beijing projects," said Howard Chao, head of
O'Melveny's Asia practice. "Beijing is an important commercial
center where a lot of deals are done, and we are already in the
thick of Beijing's deal flow." Chao is a recognized authority on
China and advises clients from many sectors in connection with
their direct investments and operations in China.

Norton emphasized that the new office will help O'Melveny better
serve both foreign and Chinese clients. The firm has represented
a number of Chinese companies in international commercial
transactions and has been particularly successful this year
representing Chinese companies in U.S. trade investigations.

"The U.S.-China bilateral relationship has become one of the
most important on the planet, commercially as well as
politically," said Norton, who has extensive experience in a
broad range of international commercial transactions, trade
disputes, and arbitration. "Our Beijing office will permit us to
stay attuned to policy and regulatory changes in China's capital
city that are important to our clients."

The addition of Mr. Zhang as a partner of the firm and to the
practice in Beijing is a significant advance for the Asia
practice of O'Melveny & Myers, said Chao and Norton.

"Howard Zhang is an important addition to O'Melveny & Myers'
Asia practice, as we expand our presence in Asia -- particularly
in China," said Mr. Chao. "His experience and diverse
qualifications are a strong complement to our already skilled
team of partners and associates in China and throughout Asia."

A former diplomat with the Chinese Foreign Ministry, Mr. Zhang
has comprehensive capabilities and experience in international
law, mergers and acquisitions, foreign direct investments, non-
performing loan matters, regulatory and government relations,
international trade, and media and entertainment.

Mr. Zhang earned his J.D. from Boston University School of Law,
his post-graduate certificate from Beijing University of
International Studies, United Nations Program, and his B.A.,
from Shanghai University of International Studies.

O'Melveny & Myers LLP is one of the world's most successful and
enterprising law firms. Established in 1885, the firm maintains
14 offices around the globe, with more than 900 attorneys
globally. As one of the world's largest law firms, O'Melveny &
Myers' capabilities span virtually every area of legal practice,
including Mergers and Acquisitions/Private Equity; Capital
Markets; Finance and Restructuring; Entertainment and Media;
Intellectual Property and Technology; Trade and International
Law; Labor and Employment; Litigation; White Collar and
Regulatory Defense; Project Development and Real Estate;
Securities; Tax; and Bankruptcy.


* BOND PRICING: For the week of December 23 - 27, 2002
-----------------------------------------------------

Issuer                                Coupon  Maturity  Price
------                                ------  --------  -----
Adelphia Communications                3.250%  05/01/21     7
Adelphia Communications                6.000%  02/15/06     7
Adelphia Communications                7.875%  05/01/09    37
Adelphia Communications               10.875%  10/01/10    38
Advanced Micro Devices Inc.            4.750%  02/01/22    64
Advanstar Communications              12.000%  02/15/11    66
AES Corporation                        4.500%  08/15/05    46
AES Corporation                        8.000%  12/31/08    58
AES Corporation                        9.375%  09/15/10    62
AES Corporation                        9.500%  06/01/09    60
Aether Systems                         6.000%  03/22/05    72
Agere Systems                          6.500%  12/15/09    73
Agro-Tech Corp.                        8.625%  10/01/07    65
Akamai Technologies                    5.500%  07/01/07    38
Alaska Communications                  9.375%  05/15/09    73
Allegheny Generating Company           6.875%  09/01/23    74
Alternative Living Services (Alterra)  5.250%  12/15/02     1
Alkermes Inc.                          3.750%  02/15/07    61
Alexion Pharmaceuticals Inc.           5.750%  03/15/07    69
Alpharma Inc.                          3.000%  06/01/06    71
Amazon.com Inc.                        4.750%  02/01/09    74
American Tower Corp.                   2.250%  10/15/09    69
American Tower Corp.                   5.000%  02/15/10    63
American Tower Corp.                   6.250%  10/15/09    67
American & Foreign Power               5.000%  03/01/30    59
America West Airlines                  6.930%  01/02/08    58
Americredit Corp.                      9.875%  04/15/06    75
Amkor Technology Inc.                  5.000%  03/15/07    57
Amkor Technology Inc.                  9.250%  05/01/06    70
Amkor Technology Inc.                  9.250%  02/15/08    66
Amkor Technology Inc.                 10.500%  05/01/09    45
AMR Corp.                              9.000%  08/01/12    50
AMR Corp.                              9.000%  09/15/16    47
AMR Corp.                              9.750%  08/15/21    48
AMR Corp.                              9.800%  10/01/21    48
AMR Corp.                             10.000%  04/15/21    49
AMR Corp.                             10.200%  03/15/20    50
AnnTaylor Stores                       0.550%  06/18/19    61
ANR Pipeline                           9.625%  11/01/21    72
Arco Chemical Company                  9.800%  02/01/20    73
Argo-Tech Corp.                        8.625%  10/01/07    72
Armstrong World Industries             9.750%  04/15/08    40
AMR Corporation                        9.000%  09/15/16    74
AMR Corporation                        9.750%  08/15/21    75
AMR Corporation                        9.800%  10/01/21    75
Asarco Inc.                            8.500%  05/01/25    35
Aspen Technology                       5.250%  06/15/05    50
Atlas Air Inc.                         9.250%  04/15/08    51
AT&T Corp.                             6.500%  03/15/29    75
AT&T Wireless                          8.750%  03/01/31    71
Aurora Foods                           9.875%  02/15/07    61
Avaya Inc.                            11.125%  04/01/09    69
Axcelis Technologies                   4.250%  01/15/07    62
BE Aerospace Inc.                      8.875%  05/01/11    70
Best Buy Co. Inc.                      0.684%  06?27/21    68
Bethlehem Steel                        8.450%  03/01/05    14
Borden Inc.                            7.875%  02/15/23    55
Borden Inc.                            8.375%  04/15/16    60
Borden Inc.                            9.250%  06/15/19    57
Borden Inc.                            9.200%  03/15/21    61
Boston Celtics                         6.000%  06/30/38    65
Brocade Communication Systems          2.000%  01/01/07    70
Brooks Automatic                       4.750%  06/01/08    73
Browning-Ferris Industries Inc.        7.400%  09/15/35    73
Budget Group Inc.                      9.125%  04/01/06    21
Building Materials Corp.               8.000%  10/15/07    72
Building Materials Corp.               8.000%  12/01/08    71
Burlington Northern                    3.200%  01/01/45    52
Burlington Northern                    3.800%  01/01/20    72
CSC Holdings Inc.                      7.625%  07/15/18    73
Calair LLC/Capital                     8.125%  04/01/08    46
Calpine Corp.                          4.000%  12/26/06    47
Calpine Corp.                          8.500%  02/15/11    44
Calpine Corp.                          8.625%  08/15/10    44
Capital One Financial                  7.125%  08/01/08    75
Case Credit                            6.750%  10/21/07    74
Case Corp.                             7.250%  01/15/16    71
Cell Therapeutic                       5.750%  06/15/08    61
Centennial Cell                       10.750%  12/15/08    57
Century Communications                 8.875%  01/15/07    34
Century Communications                 9.500%  03/01/05    23
Champion Enterprises                   7.625%  05/15/09    40
Charter Communications, Inc.           4.750%  06/01/06    24
Charter Communications, Inc.           5.750%  10/15/05    28
Charter Communications Holdings        8.625%  04/01/09    50
Charter Communications Holdings       10.250%  01/15/10    49
Ciena Corporation                      3.750%  02/01/08    70
Cincinnati Bell Telephone (Broadwing)  6.300%  12/01/28    66
Cincinnati Bell Inc. (Broadwing)       7.250%  06/15/23    66
Cogentrix Energy                       8.750%  10/15/08    74
Comcast Corp.                          2.000%  10/15/29    22
Comforce Operating                    12.000%  12/01/07    56
Commscope Inc.                         4.000%  12/15/06    74
Computer Associates                    5.000%  03/15/07    72
Computer Network                       3.000%  02/15/07    64
Cone Mills Corp.                       8.125%  03/15/05    60
Conexant Systems                       4.000%  02/01/07    46
Conexant Systems                       4.250%  05/01/06    51
Conseco Inc.                           8.750%  02/09/04     9
Conseco Inc.                          10.750%  06/15/09    13
Continental Airlines                   4.500%  02/01/07    44
Continental Airlines                   8.000%  12/15/05    52
Corning Inc.                           3.500%  11/01/08    73
Corning Inc.                           6.300%  03/01/09    75
Corning Inc.                           6.750%  09/15/13    66
Corning Inc.                           6.850%  03/01/29    54
Corning Inc.                           8.875%  08/15/21    69
Corning Glass                          8.875%  03/15/16    58
Cox Communications Inc.                3.000%  03/14/30    33
Cox Communications Inc.                0.348%  02/23/21    71
Cox Communications Inc.                0.426%  04/19/20    45
Cox Communications Inc.                7.750%  11/15/29    30
Critical Path                          5.750%  04/01/05    63
Critical Path                          5.750%  04/01/05    63
Crown Castle International             9.000%  05/15/11    74
Crown Castle International             9.375%  08/01/11    54
Crown Castle International             9.500%  08/01/11    71
Crown Castle International            10.750%  08/01/11    70
Crown Cork & Seal                      7.375%  12/15/26    69
Cubist Pharmacy                        5.500%  11/01/08    49
Curagen Corp.                          6.000%  02/02/07    64
Cummins Engine                         5.650%  03/01/98    62
Cypress Semiconductor                  3.750%  07/01/05    71
Cypress Semiconductor                  4.000%  02/01/05    72
Dana Corp.                             7.000%  03/01/29    72
Dana Corp.                             7.000%  03/15/28    72
DDI Corp.                              6.250%  04/01/07    16
Delhaize America                       9.000%  04/15/31    72
Delta Air Lines                        7.900%  12/15/09    71
Delta Air Lines                        8.300%  12/15/29    55
Delta Air Lines                        9.000%  05/15/16    65
Delta Air Lines                        9.250%  03/15/22    62
Delta Air Lines                        9.750%  05/15/21    66
Delta Air Lines                       10.375%  12/15/22    69
Dillard Department Store               7.000%  12/01/28    70
Dobson Communications Corp.           10.875%  07/01/10    72
Dobson/Sygnet                         12.250%  12/15/08    63
Documentum Inc.                        4.500%  04/01/07    74
Dresser Industries                     7.600%  08/15/96    60
DVI Inc.                               9.875%  02/01/04    75
Dynegy Holdings Inc.                   6.875%  04/01/11    41
EOTT Energy Partner                   11.000%  10/01/09    67
Echostar Communications                4.875%  01/01/07    74
Echostar Communications                5.750%  05/15/08    73
Edison Mission                         9.875%  04/15/11    29
Edison Mission                        10.000%  08/15/08    36
El Paso Corp.                          7.000%  05/15/11    68
El Paso Corp.                          7.750%  01/15/32    59
El Paso Energy                         6.750%  05/15/09    73
El Paso Energy                         8.050%  10/15/30    64
El Paso Natural Gas                    7.500%  11/15/26    57
El Paso Natural Gas                    8.625%  01/15/22    66
Emulex Corp.                           1.750%  02/01/07    72
Enron Corp.                            9.875%  06/15/03    16
Enzon Inc.                             4.500%  07/01/08    74
Equistar Chemicals                     7.550%  02/15/26    74
E*Trade Group                          6.000%  02/01/07    74
E*Trade Group                          6.750%  05/15/08    71
Extreme Networks                       3.500%  12/01/06    73
FEI Company                            5.500%  08/15/08    71
Finisar Corp.                          5.250%  10/15/08    46
Finova Group                           7.500%  11/15/09    34
Fleming Companies Inc.                 5.250%  03/15/09    51
Fluor Corp.                            6.950%  03/01/07    59
Foamex L.P.                            9.875%  06/15/07    22
Food Lion Inc.                         8.050%  04/15/27    66
Ford Motor Co.                         6.625%  02/15/28    74
Fort James Corp.                       7.750%  11/15/23    74
Foster Wheeler                         6.750%  11/15/05    58
GCI Inc.                               9.750%  08/01/07    75
General Physics                        6.000%  06/30/04    51
Geo Specialty                         10.125%  08/01/08    57
Georgia-Pacific                        7.375%  12/01/25    71
Globespan Inc.                         5.250%  05/15/06    74
Goodyear Tire                          7.000%  03/15/28    52
Goodyear Tire                          7.857%  08/15/11    73
Great Atlantic                         9.125%  12/15/11    69
Gulf Mobile Ohio                       5.000%  12/01/56    62
Hanover Compress                       4.750%  03/15/08    74
Hasbro Inc.                            6.600%  07/15/28    74
Health Management Associates Inc.      0.250%  08/16/20    67
Health Management Associates Inc.      0.250%  08/16/20    67
HealthSouth Corp.                      7.000%  06/15/08    70
HealthSouth Corp.                      8.375%  10/01/11    64
HealthSouth Corp.                      8.500%  02/01/08    74
HealthSouth Corp.                     10.750%  10/01/08    68
Hertz Corp.                            7.000%  01/15/28    74
Human Genome                           3.750%  03/15/07    65
Human Genome                           5.000%  02/01/07    72
Huntsman Polymer                      11.750%  12/01/04    67
I2 Technologies                        5.250%  12/15/06    58
ICN Pharmaceuticals Inc.               6.500%  07/15/08    73
IMC Global Inc.                        7.300%  01/15/28    70
IMC Global Inc.                        7.375%  08/01/18    73
Ikon Office                            6.750%  12/01/25    65
Ikon Office                            7.300%  11/01/27    69
Imcera Group                           7.000%  12/15/13    74
Imclone Systems                        5.500%  03/01/05    66
Incyte Genomics                        5.500%  02/01/07    68
Inhale Therapeutic Systems Inc.        3.500%  10/17/07    55
Inhale Therapeutic Systems Inc.        5.000%  02/08/07    61
Inland Steel Co.                       7.900%  01/15/07    47
International Rectifier                4.250%  07/15/07    75
Internet Capital                       5.500%  12/21/04    37
Interpublic Group                      1.870%  06/01/06    74
Isis Pharmaceutical                    5.500%  05/01/09    74
JL French Auto                        11.500%  06/01/09    54
Juniper Networks                       4.750%  03/15/07    73
Kaiser Aluminum & Chemicals Corp.      9.875%  02/15/49    67
Kmart Corporation                      9.375%  02/01/06    16
Kulicke & Soffa Industries Inc.        4.750%  12/15/06    55
Kulicke & Soffa Industries Inc.        5.250%  08/15/06    62
LSI Logic                              4.000%  11/01/06    75
LSP Energy LP                          8.160%  07/15/25    74
LTX Corporation                        4.250%  08/15/06    65
Lehman Brothers Holding                8.000%  11/13/03    64
Level 3 Communications                 6.000%  09/15/09    42
Level 3 Communications                 6.000%  03/15/10    41
Level 3 Communications                 9.125%  05/01/08    65
Level 3 Communications                11.250%  03/15/10    64
Liberty Media                          3.500%  01/15/31    64
Liberty Media                          3.750%  02/15/30    52
Liberty Media                          4.000%  11/15/29    55
LSI Logic                              4.000%  11/01/06    72
LSI Logic                              4.000%  11/01/06    72
LTX Corp.                              4.250%  08/15/06    62
Lucent Technologies                    5.500%  11/15/08    50
Lucent Technologies                    6.450%  03/15/29    43
Lucent Technologies                    6.500%  01/15/28    42
Lucent Technologies                    7.250%  07/15/06    57
Magellan Health                        9.000%  02/15/08    26
Mail-Well I Corp.                      8.750%  12/15/08    63
Mastec Inc.                            7.750%  02/01/08    75
MCi Communications Corp.               6.500%  04/15/10    46
MCI Communications Corp.               7.500%  08/20/04    29
MCI Communications Corp.               7.750%  03/15/24    30
Medarex Inc.                           4.500%  07/01/06    64
Mediacom Communications                5.250%  07/01/06    71
Mediacom LLC                           7.875%  02/15/11    67
Mediacom LLC                           8.500%  04/15/08    75
Mediacom LLC                           9.500%  01/15/13    73
Metris Companies                      10.125%  07/15/06    71
Mikohn Gaming                         11.875%  08/15/08    74
Mirant Corp.                           5.750%  07/15/07    40
Mirant Americas                        7.200%  10/01/08    49
Mirant Americas                        7.625%  05/01/06    65
Mirant Americas                        8.300%  05/01/11    43
Mirant Americas                        8.500%  10/01/21    36
Mission Energy                        13.500%  07/15/08    43
Missouri Pacific Railroad              4.750%  01/01/20    75
Missouri Pacific Railroad              4.750%  01/01/30    71
Missouri Pacific Railroad              5.000%  01/01/45    58
Motorola Inc.                          5.220%  10/01/21    63
MSX International                     11.375%  01/15/08    66
NTL (Delaware)                         5.750%  12/15/09    14
NTL Communications Corp.               7.000%  12/15/08    19
National Vision                       12.000%  03/30/09    50
Natural Microsystems                   5.000%  10/15/05    58
Navistar Financial                     4.750%  04/01/09    69
Nextel Communications                  5.250%  01/15/10    71
Nextel Partners                       11.000%  03/15/10    67
NGC Corp.                              7.625%  10/15/26    56
Noram Energy                           6.000%  03/15/12    71
Northern Pacific Railway               3.000%  01/01/47    50
Northern Pacific Railway               3.000%  01/01/47    50
Northwest Airlines                     7.625%  03/15/05    65
Nvidia Corp.                           4.750%  10/15/07    75
ON Semiconductor                      12.000%  05/15/08    73
ONI Systems Corporation                5.000%  10/15/05    74
OSI Pharmaceuticals                    4.000%  02/01/09    72
Owens-Illinois Inc.                    7.800%  05/15/18    68
PG&E Gas Transmission                  7.800%  06/01/25    60
PG&E National Energy                  10.375%  05/16/11    36
Panamsat Corp.                         6.875%  01/15/28    74
Park Ohio Industries                   9.250%  12/01/07    68
Paxson Communications                 10.750%  07/15/08    75
Pegasus Satellite                     12.375%  08/01/06    49
Pegasus Satellite                     12.500%  08/01/07    15
Photronics Inc.                        4.750%  12/15/06    68
PMC-Sierra Inc.                        3.750%  08/15/06    75
Polaroid Corp.                        11.500%  02/15/06     5
Polymer Group                          9.000%  07/01/07    21
Primedia Inc.                          7.625%  04/01/08    71
Primedia Inc.                          8.875%  05/15/11    73
Providian Financial                    3.250%  08/15/05    73
PSEG Energy Holdings                   8.500%  06/15/11    73
Public Service Electric & Gas          5.000%  07/01/37    71
Photronics Inc.                        4.750%  12/15/06    72
Quanta Services                        4.000%  07/01/07    56
Qwest Capital Funding                  7.000%  08/03/09    62
Qwest Capital Funding                  7.250%  02/15/11    62
Qwest Capital Funding                  7.625%  08/03/21    47
Qwest Capital Funding                  7.750%  08/15/06    66
Qwest Capital Funding                  7.900%  08/15/10    64
Qwest Communications Int'l             7.250%  11/01/06    74
RF Micro Devices                       3.750%  08/15/05    74
RF Micro Devices                       3.750%  08/15/05    74
Redback Networks                       5.000%  04/01/07    25
Rite Aid Corp.                         4.750%  12/01/06    73
Rite Aid Corp.                         7.125%  01/15/07    72
Rockwell Int'l                         5.200%  01/15/98    72
Royster-Clark                         10.250%  04/01/09    74
Rural Cellular                         9.625%  05/15/08    50
Ryder System Inc.                      5.000%  02/25/21    74
SBA Communications                    10.250%  02/01/09    54
SC International Services              9.250%  09/01/07    65
SCI Systems Inc.                       3.000%  03/15/07    70
Saks Inc.                              7.375%  02/15/19    72
Sepracor Inc.                          5.000%  02/15/07    59
Sepracor Inc.                          5.750%  11/15/06    63
Sepracor Inc.                          7.000%  12/15/05    62
Service Corp. Int'l                    6.750%  06/22/08    74
Silicon Graphics                       5.250%  09/01/04    54
Simula Inc.                            8.000%  05/01/04    73
Skechers USA, Inc.                     4.500%  04/15/07    75
Solutia Inc.                           7.375%  10/15/27    74
Sonat Inc.                             7.625%  07/15/11    59
Sonic Automotive                       5.250%  05/07/09    74
Sotheby's Holdings                     6.875%  02/01/09    74
Sprint Capital Corp.                   6.900%  05/01/19    67
TCI Communications Inc.                7.125%  02/15/28    74
TECO Energy Inc.                       7.000%  05/01/12    73
Tenneco Inc.                          10.000%  03/15/08    72
Tenneco Inc.                          11.625%  10/15/09    75
Teradyne Inc.                          3.750%  10/15/06    72
Tesoro Pete Corp.                      9.000%  07/01/08    66
Tesoro Pete Corp.                      9.625%  11/01/08    57
TIG Holdings Inc.                      8.125%  04/15/05    75
Transwitch Corp.                       4.500%  09/12/05    60
Trenwick Capital I                     8.820%  02/01/37    72
Tribune Company                        2.000%  05/15/29    73
Triton PCS Inc.                        8.750%  11/15/11    74
Triton PCS Inc.                        9.375%  02/01/11    74
Trump Atlantic                        11.250%  05/01/06    74
Turner Broadcasting                    8.375%  07/01/13    74
TXU Corp.                              6.375%  06/15/06    75
US Airways Passenger                   6.820%  01/30/14    72
US Airways Inc.                        7.960%  01/20/18    74
Ugly Duckling                         11.000%  04/15/07    60
Universal Health Services              0.426%  06/23/20    64
US Timberlands                         9.625%  11/15/07    62
US West Capital Funding                6.375%  07/15/08    59
Vector Group Ltd.                      6.250%  07/15/08    63
Veeco Instrument                       4.125%  12/21/08    73
Vertex Pharmaceuticals                 5.000%  09/19/07    73
Vesta Insurance Group                  8.750%  07/15/25    74
Viropharma Inc.                        6.000%  03/01/07    35
Vitesse Semiconductor                  4.000%  03/15/05    72
Weirton Steel                         10.750%  06/01/05    35
Weirton Steel                         11.375%  07/01/04    52
Westpoint Stevens                      7.875%  06/15/05    30
Westpoint Stevens                      7.875%  06/15/08    28
Williams Companies                     6.625%  11/15/04    65
Williams Companies                     6.750%  01/15/06    65
Williams Companies                     7.125%  09/01/11    73
Williams Companies                     7.625%  07/15/19    62
Williams Companies                     7.750%  06/15/31    58
Williams Companies                     7.875%  09/01/21    62
Williams Companies                     9.375%  11/15/21    72
Wind River System                      3.750%  12/15/06    74
Witco Corp.                            6.875%  02/01/26    68
XM Satellite Radio                     7.750%  03/01/06    39
XM Satellite Radio                    14.000%  03/15/10    52
Xerox Corp.                            0.570%  04/21/18    63
Xerox Credit                           6.500%  04/29/13    59

                          *********

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

Each Tuesday edition of the TCR contains a list of companies
with insolvent balance sheets whose shares trade higher than $3
per share in public markets.  At first glance, this list may
look like the definitive compilation of stocks that are ideal to
sell short.  Don't be fooled.  Assets, for example, reported at
historical cost net of depreciation may understate the true
value of a firm's assets.  A company may establish reserves on
its balance sheet for liabilities that may never materialize.
The prices at which equity securities trade in public market are
determined by more than a balance sheet solvency test.

A list of Meetings, Conferences and Seminars appears in each
Wednesday's edition of the TCR. Submissions about insolvency-
related conferences are encouraged. Send announcements to
conferences@bankrupt.com.

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 ***