---

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

         Tuesday, September 27, 2005, Vol. 9, No. 229

                          Headlines

AERWAV INTEGRATION: U.S. Trustee Names 5-Member Creditors' Panel
AERWAV INTEGRATION: Committee Taps Becker Meisel as Counsel
AERWAV INTEGRATION: Leaf Saltzman Hired as Committee's Accountants
AIR CANADA: Submits Dispute with Pilots' Union to Mediation
AMERICAN PACIFIC: Moody's Junks Sr. Secured 2nd-Lien Term Loan

ARGO-TECH CORP: Moody's Reviews Low-B Ratings & May Downgrade
AOL LATIN AMERICA: Will Retrench 72 Employees by Month-End
ASARCO LLC: Wants to Employ Keegan Linscott as Accountant
ASARCO LLC: Wants to Reject Three Equipment Leases with CNB
ASARCO LLC: Wants Until Jan. 13 to Decide on Leases

ATA AIRLINES: U.S. Trustee Told to Appoint C8 Creditor to Panel
BSI HOLDING: Liquidation Trustee Wants to Delay Closing to Mar. 3
CANWEST GLOBAL: Gets Requisite Consents to Amend Senior Indentures
CARDIAC SERVICES: Wants CVG Approved as Valuation Expert
CARDIAC SERVICES: UST Wants CGV's Disinterestedness Affidavit

CATHOLIC CHURCH: Spokane Wants Avoidance Actions Stayed
CENTURY ALUMINUM: Inks New $100MM Sr. Sec. Revolving Credit Pact
CIMAREX ENERGY: Moody's Assigns Ba3 Corporate Family Rating
CONSTAR INTERNATIONAL: Has Access to $45.1-Mil from Revolver Funds
CONSTAR INT'L: S&P Junks $395 Million Senior Notes' Ratings

CORNERSTONE PRODUCTS: Hires Wimmer as Restructuring Consultant
CORNERSTONE PRODUCTS: Panel Objects to Sundance Payments
COTT CORP: Gets $4.9-Mil from Settlement of Antitrust Class Suit
COTT CORP: Says 2005 Earnings Will Be Substantially Below Guidance
DELTA AIR: Court Okays Payments Under Critical Carrier Agreements

DELTA AIR: Court Okays Payment of Prepetition Taxes & Fees
DELTA AIR: Retired Pilots Want Sec. 1114 Committee Appointed
DERIVIUM CAPITAL: Files Schedules of Assets and Liabilities
DURATEK INC: Expects 2005 Revenues at $280 Million to $286 Million
DYCOM INDUSTRIES: S&P Rates $150 Million Sr. Sub. Notes at B+

DYCOM INVESTMENTS: Moody's Rates $150 Mil. Sr. Sub. Notes at Ba3
ELITE TECHNICAL: CEO Fenton Out; Goudy & Heidebrecht on Helm
ENER1 INC: Eisner LLP Replaces Kaufman Rossin as Auditors
ENRON CORP: Court Okays Amendments to Plan Schedule S
ENRON CORP: Court Okays $1.4 Million Settlement with UBS AG

ENRON CORP: Wants Project Teresa Settlement Agreement Approved
ENTERGY NEW ORLEANS: Files Chapter 11 Petition Due to Katrina
ENTERGY NEW ORLEANS: Case Summary & 20 Largest Unsecured Creditors
ENTERGY NEW ORLEANS: Fitch Assigns D Issuer Default Rating
ENTERGY NEW ORLEANS: S&P Downgrades Corporate Credit Rating to D

ENXNET INC: Sprouse & Anderson Declines Re-Election as Auditor
EPICUS COMMS: Auditors Express Going Concern Doubt in Form 10-K
FAIRFAX FINANCIAL: Fitch Affirms Senior Debt Ratings at B+
GOODYEAR TIRE: Expects to Spend $150M to $250M on Turnaround Plan
GS CONSULTING: Chapter 7 Trustee Sues to Recover Estate Property

GS CONSULTING: Meeting of Creditors Continued on Oct. 18
HEALTH RAMP: Voluntary Chapter 11 Case Summary
HEATING OIL: Files for Chapter 11 Protection in Connecticut
HEATING OIL: Case Summary & 20 Largest Unsecured Creditors
HOLLINGER INT'L: Board Declares $0.05 Dividend for Common Shares

HOUSE2HOME: Court Approves GMAC Pact to Resolve Contested Claim
IGENE BIOTECHNOLOGY: Completes 50% of Financial Restatements
INTERMET CORP: Court Confirms Amended Plan of Reorganization
INTERSTATE BAKERIES: Dist. Ct. Okays Final Class Action Settlement
INTERSTATE BAKERIES: Wants to Pay Tax & Other Secured Claims

JERNBERG INDUSTRIES: Wants Chapter 11 Cases Converted to Chapter 7
KBSH LEADERS: Investment Managers Present Plan to Dissolve Trust
KERZNER INT'L: Accepts 99.22% of $400 Mil. Sr. Sub. Notes in Offer
LIMELIGHT MEDIA: June 30 Balance Sheet Upside-Down by $266,545
LIN TELEVISION: Moody's Rates $175 Million Sr. Sub. Notes at B1

LIN TELEVISION: S&P Rates Proposed $175 Million Sub. Notes at B-
LSP-KENDALL ENERGY: Moody's Rates $422 Million Facilities at B1
MAGNUM HUNTER: Moody's Upgrades Sr. Unsec. Notes' Rating to Ba3
MAYTAG CORP: Moody's Lowers Senior Unsecured Debt Rating to B2
MCI INC: Completes Acquisition of Totality Corp.

MCI INC: D.E. Shaw to Vote Against MCI-Verizon Merger on Oct. 6
METALLURG INC: Issuing $167.5 Million of New Senior Secured Notes
MIRANT CORP: Disclosure Statement Hearing Slated for Tomorrow
MIRANT CORP: Southern Co. Wants $2BB Suit Transferred to Georgia
MIRANT CORP: Restarts Potomac River Plant Unit 1 After Filing Plan

MORTGAGE ASSET: Fitch Holds Low-B Rating on Seven Cert. Classes
MOVIE GALLERY: Amends $870 Million Senior Secured Credit Facility
NBTY INC: Closing 7-1/8% Senior Subordinated Debt Offering
NETWORK INSTALLATION: Acquires Kelley Tech. in an All-Equity Deal
NEW WORLD: Judge France Approves Amended Disclosure Statement

NORTHWEST AIRLINES: Paying $91MM Prepetition Employee Obligations
NORTHWEST AIRLINES: Board Approves Amendment to Incentive Program
NORTHWEST AIRLINES: Interline Pacts Approved on Interim Basis
OAK CREEK: Section 341(a) Meeting Slated for Oct. 19
OM GROUP: Delivers Delayed Financial Reports to SEC

PARKWAY HOSPITAL: Gets Interim Okay to Use $3.7MM Cash Collateral
PLYMOUTH RUBBER: Has Until October 31 to Decide on Leases
RELIANCE GROUP: Bankruptcy Court Approves Disclosure Statement
RELIANCE GROUP: Committee Has Until Oct. 28 to Solicit Acceptances
RITE AID: Posts $1.6 Million Net Loss in Second Quarter

ROYAL GROUP: Board of Directors OKs Comprehensive Improvement Plan
RUSSELL WYNN: Wants to Hire Ling Robinson as Bankruptcy Counsel
SAINT CASIMIR: Wants Rattet Pasternak as Bankruptcy Counsel
SAINT VINCENTS: Gets Final Court Nod to Access Cash Collateral
SAINT VINCENTS: Revises Sun Life Cash Collateral Deal

SIGNATURE 5: Moody's Reviews $20 Million Class C Notes' B2 Rating
SITESTAR CORP: Buying Idacomm Internet Assets for $1.698 Million
SPECTRX INC: June 30 Balance Sheet Upside-Down by $6 Million
SPIEGEL INC: Johnson & Morris Seek Reconsideration on $912K Claim
STRATEGY INTERNATIONAL: Posts $3.5M Net Loss in 1st Quarter of '05

SUN NETWORK: Going Concern Doubts Continue as Deficits Widen
TERRY LYTLE: Case Summary & 20 Largest Unsecured Creditors
THERMOVIEW INDUSTRIES: Files Chapter 11 Petition in W.D. Kentucky
THERMOVIEW INDUSTRIES: Case Summary & 40 Largest Unsec. Creditors
UAL CORP: Court Authorizes MyPoints KERP Implementation

UAL CORP: Wants to Walk Away from Sky Chefs & Detroit Leases
UNIFI INC: S&P Junks Corporate Credit & Sr. Unsecured Debt Ratings
UNOVA INC: Debt Reduction Cues Fitch to Raise IDR to BB- from B-
USG CORP: Futures Rep. Wants to Hire Michael Crames as Advisor
USGEN NEW ENGLAND: Inks Pact Resolving ET Power's & ET Gas' Claims

VALHI INC: Fitch Retains BB- Rating on Senior Secured Debt
VARIG S.A.: Brazilian Bankruptcy Judge Teams Up With Judge Drain
VARIG S.A.: Aircraft SPC-6 Wary of Status of Assets
VARIG S.A.: Opposes GATX's Bid to Lift Preliminary Injunction
VILLAGES AT SARATOGA: Hires Robert Frugal as Bankruptcy Counsel

VILLAGES AT SARATOGA: Files Schedules of Assets and Liabilities
VILLAGES AT SARATOGA: Section 341(a) Meeting Slated for Oct. 5
WATERMAN INDUSTRIES: Files Reorganization Plan in E.D. California
WERNER HOLDING: S&P Affirms Junk Corporate Credit Rating
WESTPOINT STEVENS: Funds, et al. Wants Panel's Fee Request Denied

WHITEFORD FOOD: Case Summary & 20 Largest Unsecured Creditors
WHITING PETROLEUM: S&P Rates Proposed $250 Million Notes at B-
WILLIAM BOYD: Case Summary & Largest Unsecured Creditors
WILLIAM FITZGERALD: Case Summary & Largest Unsecured Creditor
WILLIAMS SCOTSMAN: S&P Upgrades Corporate Credit Rating to BB-

WILLBROS GROUP: Noteholders Agree to Waive Potential Defaults

* Large Companies with Insolvent Balance Sheets

                          *********

AERWAV INTEGRATION: U.S. Trustee Names 5-Member Creditors' Panel
----------------------------------------------------------------
The United States Trustee for Region 3 appointed five creditors to
serve on an Official Committee of Unsecured Creditors in Aerwav
Integration Group, Inc.'s chapter 11 case:

     1. Vicon Industries, Inc.
        Attn: Lewis Barbo
        89 Arkay Drive
        Hauppauge, NY 11788
        Tel/fax: 631-952-2288

     2. ADI-Division of Honeywell, Inc.
        Attn: Parvinder Uppal
        263-Old Country Road
        Melville, NY 11747
        Tel: 631-692-1262, Fax: 631-692-3454

     3. Signs USA, Inc.
        Attn: Thomas Miano
        4123 W. Hillsborough Avenue
        Tampa, FL 33614
        Tel: 813-901-9333, Fax: 813-901-9334

     4. Janet Geismar
        2009 Cedarview Drive
        Greensboro, NC 27455
        Tel: 336-643-8614

     5. Alliance Group
        Attn: Michael Pitino
        9505 Williamsburg Plaza
        Suite 101
        Louisville, KY 40222
        Tel: 502-425-3715, Fax: 502-425-3579

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

Heaquartered in Pine Brook, New Jersey, Aerwav Integration Group,
Inc., fka ArmorGroup Integrated Systems dba Aerwav Integration
Services -- http://www.aerwavintegration.com/-- creates,
installs,  monitors and customizes integrated electronic safety
and security systems.  The Debtor, along with its affiliates,
filed for chapter 11 protection on July 22, 2005 (Bankr. D. N.J.
Case Nos. 05-33791 through 05-33794).  Gerald H. Gline, Esq., and
Warren A. Usatine, Esq., at Cole, Schotz, Meisel, Forman &
Leonard, P.A., represent Aerwav.  When the Debtors filed for
chapter 11 protection, they estimated below $50,000 in assets and
$1 million to $10 million in debts.


AERWAV INTEGRATION: Committee Taps Becker Meisel as Counsel
-----------------------------------------------------------
The Official Committee of Unsecured Creditors of Aerwav
Integration Group, Inc., and its debtor-affiliates asks the U.S.
Bankruptcy Court for the District of New Jersey for permission to
retain Becker Meisel LLC as its counsel.

Becker Meisel is expected to:

     a. advise the Committee with respect to its powers and
        duties in these cases;

     b. investigate, as necessary, the financial affairs of the
        Debtors;

     c. meet with representatives of the Debtors, as necessary,
        to formulate, negotiate and implement a plan or plans of
        reorganization;

     d. prepare on behalf of the Committee all necessary and
        appropriate applications, motions, pleadings, draft
        orders and to review all financial and other reports to
        be filed in these Chapter 11 cases;

     e. attend, when necessary, Court hearings, depositions, Rule
        2004 examinations and other proceedings in these Chapter
        11 cases; and

     f. perform all other legal services for the Committee which
        may be necessary including, but not limited to, advising
        the Committee with respect to all issues relating to the
        marshaling of assets and maximizing a distribution to
        unsecured creditors.

Becker Meisel's professionals and their current billing rates:

     Professional                  Rates
     ------------                  -----
     Ben H. Becker                  $400
     Stacey L. Meisel               $300
     Martin L. Borosko              $285
     Daniel J. O'Hern               $400
     Joseph G. Harraka, Jr.         $325
     Steven R. Weinstein            $300
     Douglas A. Kent                $300
     Linda Brower                   $300
     Ivan J. Kaplan                 $250
     Daniel J. O'Hern, Jr.          $250
     Anthony J. Vizzoni             $220
     Michael A. Oxman               $220
     Allen J. Underwood II          $210
     Amanda L. Schultz              $150
     Michael E. Holzapfel           $150
     Daniel L. Pascoe               $125
     Clerks & Paralegals         $75 - $110

To the best of the Debtors' knowledge, Becker Meisel is a
"disinterested person" as that term is defined in Section 101(14)
of the Bankruptcy Code.

Heaquartered in Pine Brook, New Jersey, Aerwav Integration Group,
Inc., fka ArmorGroup Integrated Systems dba Aerwav Integration
Services -- http://www.aerwavintegration.com/-- creates,
installs,  monitors and customizes integrated electronic safety
and security systems.  The Debtor, along with its affiliates,
filed for chapter 11 protection on July 22, 2005 (Bankr. D. N.J.
Case Nos. 05-33791 through 05-33794).  Gerald H. Gline, Esq., and
Warren A. Usatine, Esq., at Cole, Schotz, Meisel, Forman &
Leonard, P.A., represent Aerwav.  When the Debtors filed for
chapter 11 protection, they estimated below $50,000 in assets and
$1 million to $10 million in debts.


AERWAV INTEGRATION: Leaf Saltzman Hired as Committee's Accountants
------------------------------------------------------------------
The U.S. Bankruptcy Court for the District of New Jersey gave the
Official Committee of Unsecured Creditors of Aerwav Integration
Group, Inc., and its debtor-affiliates permission to employ and
retain Leaf, Saltzman, Manganelli, Pfeil & Tendler, LLP, as its
accountants.

Leaf Saltzman will:

   a) assist the Committee in analyzing the current financial
      position, including the Debtors' books and records;

   b) evaluate the cash management systems currently being used by
      the Debtors;

   c) assist the Committee in evaluating the Debtors' financial
      projections and test the reasonableness of the assumptions
      used in developing the same;

   d) prepare hypothetical orderly or forced liquidation analyses;

   e) assist the Committee in analyzing the financial
      ramifications of any proposed transactions for which the
      Debtors may seek Bankruptcy Court approval including, but
      not limited to, potential DIP financing agreements,
      assumption or rejection of executory contracts, management
      compensation and/or retention and severance plans;

   f) assist the Committee in its investigation of the Debtors'
      acts, conduct, assets, liabilities, and financial condition,
      the operation of Debtors' business, and the desirability of
      the continuation of such business, and any other matters
      relevant to the case or to the formulation of a plan of
      reorganization or liquidation;

   g) assist and advise the Committee in its analysis of the
      Debtors' statements of financial affairs and schedules of
      assets and liabilities;

   h) investigate and analyze on behalf of the Committee the
      Debtors' financial operations, related-party transactions
      and accounts, inter-company transfers and asset recovery
      potential;

   i) analyze financial information prepared by the Debtors or its
      accountants or financial advisors as requested by the
      Committee including, but not limited to, Debtors' monthly
      operating reports, cash flow projections and comparisons of
      actual to projected performance;

   j) assist and advise the Committee and its counsel in the
      development, evaluation and documentation of any plan of
      reorganization or liquidation, including developing,
      structuring and negotiating the terms and conditions of such
      plan of reorganization or liquidation and the value
      of consideration that is to be provided to unsecured
      creditors;

   k) assist the Committee in the evaluation of a proposed sale,
      if any, and related procedures under section 363 of the
      Bankruptcy Code, including identification of potential
      buyers;

   l) attend and advise at meetings with the Committee and its
      counsel and representatives of the Debtors;

   m) render expert testimony on behalf of the Committee, if
      required; and

   n) provide such other services, as requested by the Committee
      or counsel from time to time and agreed to by the firm.

Larry Leaf, a Leaf Saltzman partner, discloses that he will be
paid $235 per hour for his services and Scott Kemp's services at
$135 per hour.

Mr. Leaf assures the Court that the firm is a "disinterested
person" as that term is defined in Section 101(14) of the
Bankruptcy Code.

Heaquartered in Pine Brook, New Jersey, Aerwav Integration Group,
Inc., fka ArmorGroup Integrated Systems dba Aerwav Integration
Services -- http://www.aerwavintegration.com/-- creates,
installs,  monitors and customizes integrated electronic safety
and security systems.  The Debtor, along with its affiliates,
filed for chapter 11 protection on July 22, 2005 (Bankr. D. N.J.
Case Nos. 05-33791 through 05-33794).  Gerald H. Gline, Esq., and
Warren A. Usatine, Esq., at Cole, Schotz, Meisel, Forman &
Leonard, P.A., represent Aerwav.  When the Debtors filed for
chapter 11 protection, they estimated below $50,000 in assets and
$1 million to $10 million in debts.


AIR CANADA: Submits Dispute with Pilots' Union to Mediation
-----------------------------------------------------------
Air Canada and the Air Canada Pilots Association have agreed to
submit the long-standing seniority dispute to mediation for a
final resolution.  The parties have agreed to appoint Martin
Teplitsky, Q.C., a very senior and prominent mediator, to direct
the mediation efforts.

"The decision to begin the mediation process was approved by
ACPA's Master Executive Council," said Captain Kent Wilson,
President of ACPA.  "We sincerely hope that, Mr. Teplitsky, and
the mediation process can bring the seniority issue to a final
settlement," said Captain Wilson.  "For the pilots and for the
Company, we must resolve the issue in a fair way that allows us to
move forward." Details, including a schedule for the mediation,
will be worked out shortly.

ACPA and Air Canada also agreed to a binding arbitration process
for resolving issues related to the acquisition of Boeing (B777
and B787) aircraft. Mr. Teplitsky has been appointed as the
arbitrator in this matter.

The Air Canada Pilots Association is the largest professional
pilot group in Canada, representing about 3100 pilots who operate
Air Canada's mainline fleet.

Air Canada filed for CCAA protection on April 1, 2003 (Ontario
Superior Court of Justice, Case No. 03-4932) and filed a Section
304 petition in the U.S. Bankruptcy Court for the Southern
District of New York (Case No. 03-11971).  Mr. Justice Farley
sanctioned Air Canada's CCAA restructuring plan on Aug. 23, 2004.
Sean F. Dunphy, Esq., and Ashley John Taylor, Esq., at Stikeman
Elliott LLP, in Toronto, serve as Canadian Counsel to the carrier.
Matthew A. Feldman, Esq., and Elizabeth Crispino, Esq., at Willkie
Farr & Gallagher, serve as the Debtors' U.S. Counsel.  When the
Debtors filed for protection from their creditors, they listed
C$7,816,000,000 in assets and C$9,704,000,000 in liabilities.

On Sept. 30, 2004, Air Canada successfully completed its
restructuring process and implemented its Plan of Arrangement.
The airline exited from CCAA protection raising $1.1 billion of
new equity capital.

As of Dec. 31, 2004, Air Canada's shareholders' deficit
narrowed to CDN$203 million compared to a $4.155 billion deficit
at Dec. 31, 2003.


AMERICAN PACIFIC: Moody's Junks Sr. Secured 2nd-Lien Term Loan
--------------------------------------------------------------
Moody's Investors Service assigned a B2 corporate family rating to
American Pacific Corporation.  Moody's also assigned B2 ratings to
the company's proposed first lien term loan and revolver, a Caa1
rating to its second lien term loan, and a speculative grade
liquidity rating of SGL-3.  Proceeds from the debt offering will
be used, along with a subordinated $19 million seller-note and
cash, to fund the acquisition of the Aerojet Fine Chemicals
business of GenCorp Inc.  The rating outlook is stable.

Ratings Assigned:

  American Pacific Corporation:

     * Corporate Family Rating -- B2

     * Senior Secured Revolver due October 2010 -- B2

     * Senior Secured First Lien Term Loan due October 2010 -- B2

     * Senior Secured Second Lien Term Loan due October 2011
       -- Caa1

     * Speculative Grade Liquidity Rating -- SGL-3

The B2 ratings reflect:

   * elevated business risk associated with a large step-out
     acquisition;

   * weak near-term fundamentals of the company's ammonium
     perchlorate business; and

   * elevated debt levels subsequent to the acquisition.

Furthermore, the ratings reflect:

   * the combined company's small size;

   * limited product diversity;

   * ongoing environmental costs; and

   * elevated intermediate to long term product risk associated
     with a pharmaceutical intermediates business.

AMPAC is purchasing Aerojet for $119 million.

AMPAC's B2 ratings are supported by its position as the only US
supplier of AP for solid fuel rocket motors and Aerojet's existing
qualifications for the supply of intermediates for certain
pharmaceuticals that have demonstrated good growth over the past
few years.  Moody's noted however, that there is substantial
longer-term risk related to Aerojet's revenue from these
applications, as described more fully below.

The B2 senior secured first lien term loan and revolver are rated
at the same level as the corporate family rating since they
comprise the majority of the outstanding debt.  Additionally, the
lender's position is supported by a 75% excess cash flow sweep
provision, until total debt to EBITDA falls to 3 times.  The Caa1
rating on the second lien loan, two notches below the corporate
family rating, reflects the second lien holders' lack of rights
relative to the first lien holders, as defined by the inter-
creditor agreement.

Moreover, the lack of asset coverage in a distressed scenario,
provides limited coverage to first lien holders, and hence,
severely limits the potential recovery for second lien holders.
The current ratings assume that the terms and size of the
definitive credit agreements will not be substantially different
from the draft documentation provided to Moody's.  If terms in the
executed agreements differ substantially from the draft documents,
Moody's may reassess the company's ratings and/or outlook.

The stable outlook reflects:

   * Moody's belief that AP demand will remain at or above
     8-9 million pounds;

   * near-term sales will grow from Aerojet's existing
     qualifications related to three pharmaceuticals; and

   * that AMPAC's other businesses will remain modest contributors
     to EBITDA.

While AMPAC has not publicly released information on AFC's
historical or projected performance, Moody's believes:

   * that the combined company should be able to generate at least
     $5-10 per year of free cash flow (excluding legacy
     environmental expenditures in fiscal 2006);

   * that total adjusted net debt to EBITDA will fall below 5
     times by the end of 2006; and

   * that management will actively manage the level of capital
     spending over the next several years related to the Aerojet
     business.

Failure of the company to meet these projections could result in a
negative rating action.  If the company is able to generate more
than $10-15 million per year of free cash flow and total adjusted
net debt to EBITDA falls below 4 times, there would be upward
pressure on the ratings.

AMPAC's speculative grade liquidity rating of SGL-3 reflects the
small size of the company and its revolver, and uncertainty over
the headroom under the yet-to-be-negotiated financial covenants in
its credit facilities.  Moreover, the absolute level of free cash
flow anticipated over the next 12-15 months is not sufficient to
support a higher rating.  However, if there is sufficient headroom
under the financial covenants in the credit facility, the company
increases the size of the revolver, and the company's cash balance
after completion of the transaction is higher than currently
anticipated, then Moody's could raise the rating to SGL-2.

AMPAC's sales of AP account for the majority of the company's
sales and EBITDA.  Sales and profitability have declined over the
past several years due to a significant drop in demand from NASA
for the space shuttle (roughly 70% of the shuttle's solid rocket
booster is comprised of AP).  This decline has been partially
offset by increases in demand by the US Department of Defense
(DoD) for the refurbishment of Minuteman missiles.  Due to
problems on the most recent shuttle flight, as well as the
anticipated decline in sales related to the Minuteman
refurbishment program, AP volumes could experience additional
weakness.

However, Moody's does believe that NASA and US Department of
Defense will place orders at a minimum level to ensure that
AMPAC's production infrastructure remains in place.  Additionally,
Moody's takes a modest level of comfort in the knowledge that if
the shuttle missions were postponed for an extended period, other
launch vehicles would likely be required to place US commercial
and military satellites in orbit over the next several years,
ensuring some measure of additional demand for AMPAC's AP.

Aerojet Fine Chemicals is a producer of pharmaceutical
intermediates.  The majority of the company's sales are tied to a
specific number of pharmaceuticals that Moody's can track.  Given
the growth of these particular pharmaceuticals over the past
several years, Moody's is comfortable that near-term sales will
not decline from current levels.  In Moody's opinion, there could
be a reasonable amount of upside in the Aerojet business over the
next few years, but longer-term there is significant product and
technology risk as many of Aerojet's competitors have more
substantial resources than AMPAC.

Additionally, the manufacture of pharmaceutical intermediates is
an evolving science subject to substantial investment by companies
and research institutions.  Moody's views the pharmaceutical
intermediates business as having significant long-term product and
technology risk, as products may be displaced due to newer
pharmaceuticals or by changes in production processes and
equipment.

AMPAC recently took a $22 million charge related to legacy
environmental issues at its closed Henderson, Nevada site.  The
remediation site plan has been approved by state officials and
spending is expected to be roughly $6 million in fiscal 2005-2006,
with roughly $400 thousand of annual operating expense thereafter.
While there can be no assurance that additional capital will not
be required, nor that other liabilities related to the
contamination at this site will arise, Moody's currently views the
remediation plan as feasible and the costs as manageable.

As with most remediation projects, AMPAC's spending will continue
for the foreseeable future and there can be no assurance that
changes in government regulations or public policy will not result
in a significant increase in costs or capital.  In Moody's view,
this increases the risks behind the B2 corporate family rating.
Additionally, there can be no assurance that AMPAC can recover any
of these costs from NASA or the DoD.

American Pacific Corporation, headquartered in Las Vegas, Nevada,
is the sole North American provider of ammonium perchlorate, the
primary ingredient in solid rocket motors.  AMPAC is also a
leading supplier of liquid propulsion products and bipropellant
thrusters.  In July 2005, the company executed an Asset Purchase
Agreement with GenCorp Inc. to acquire Aerojet Fine Chemicals.


ARGO-TECH CORP: Moody's Reviews Low-B Ratings & May Downgrade
-------------------------------------------------------------
Moody's Investors Service placed the ratings of Argo-Tech
Corporation under review for possible downgrade following the
announcement by the company of the sale of its parent company, AT
Holdings Corporation, to private equity group V.G.A.T. Investors,
LLC for $173 million.  The ratings review will focus on the new
financial structure that will ensue as the result of the purchase
of the company by V.G.A.T. and the implication of that structure
for existing debt holders.

The affected ratings, which have been made definitive, include:

   * Senior secured revolving credit facility due 2009, rated B1,
   * Senior secured term loans due 2009, rated B1,
   * Senior unsecured notes due 2011, rated B3, and
   * Corporate Family Rating of B2

Argo-Tech Corporation, based in Cleveland, Ohio, through its
operating subsidiaries designs, manufactures and services high
performance fuel flow devices primarily for the aerospace
industry.  Products include:

   * main engine fuel pumps,
   * air-frame fuel pumps,
   * aerial refueling systems,
   * components for ground-fueling systems, and
   * industrial cryogenic pumps and components.

The company is 65% owned by senior management and other employees,
primarily through an ESOP structure.


AOL LATIN AMERICA: Will Retrench 72 Employees by Month-End
----------------------------------------------------------
As part of its restructuring efforts, on Sept. 19, 2005, America
Online Latin America, Inc.'s Board of Directors approved a
workforce reduction of 72 employees in Mexico and Argentina.  AOLA
expects to incur severance charges related to this workforce
reduction of approximately $1.9 million in the third quarter of
2005.  AOLA expects to complete this workforce reduction by the
end of September 2005.

Headquartered in Fort Lauderdale, Florida, America Online Latin
America, Inc. -- http://www.aola.com/ -- offers AOL-branded
Internet service in Argentina, Brazil, Mexico, and Puerto Rico, as
well as localized content and online shopping over its proprietary
network.  Principal shareholders in AOLA are Cisneros Group, one
of Latin America's largest media firms, Brazil's Banco Itau, and
Time Warner, through America Online.  The Company and its debtor-
affiliates filed for chapter 11 protection on June 24, 2005
(Bankr. D. Del. Case No. 05-11778).  Pauline K. Morgan, Esq., and
Edmon L. Morton, Esq., at Young Conaway Stargatt & Taylor, LLP and
Douglas P. Bartner, Esq., at Shearman & Sterling LLP represent the
Debtors in their restructuring efforts.  When the Debtors filed
for protection from their creditors, they listed total assets of
$28,500,000 and total debts of $181,774,000.


ASARCO LLC: Wants to Employ Keegan Linscott as Accountant
---------------------------------------------------------
ASARCO LLC seeks authority from the U.S. Bankruptcy Court for the
Southern District of Texas to employ Keegan, Linscott & Kenon,
P.C., as its accountant nunc pro tunc to Aug. 9, 2005.

James R. Prince, Esq., at Baker Botts L.L.P., in Dallas, Texas,
tells Judge Schmidt that Keegan is a full service accounting firm
established in January 1994 in Tucson, Arizona.  The firm is a
professional services corporation, which offers a wide range of
services specializing in real estate, construction, non-profit
organizations, mining, and business consulting.  The firm enjoys
an outstanding reputation in the community and its Tucson office
is the third largest accounting firm in Southern Arizona.

Mr. Prince relates that since 1999, Keegan has represented ASARCO
as accountants and has performed financial statement audits,
royalty audits, pension plan audits and tax and consulting
services for the company.  Because of Keegan's previous
engagement with ASARCO, the firm already has an extensive
experience with and knowledge of the company's businesses and
financial affairs, and is already an expert in the matters for
which the firm is employed.  Accordingly, Keegan is uniquely
qualified to assist ASARCO in certain accounting matters.

ASARCO believes that in engaging accountants other than Keegan,
the company, its estate, and all parties-in-interest would be
unduly prejudiced by the time and expense necessarily attendant
to the accountant's familiarization with ASARCO's business
operations and affairs, and the impossibility of acquiring that
familiarity within the time constraints.

Mr. Prince informs the Court that in the ordinary course of
representing ASARCO before the Petition Date, Keegan received a
$13,669 retainer.  Within the 90-day period preceding the
commencement of ASARCO's Chapter 11 cases, the firm received
$84,270 for professional services rendered and as reimbursement
for prepetition expenses incurred.

ASARCO will pay Keegan in accordance with the firm's customary
hourly rates, which range from $65 to $250.  Keegan will also be
reimbursed for the necessary out-of-pocket expenses it incurs.

ASARCO asks Judge Schmidt to allow Keegan to submit interim
monthly invoices to the company for reimbursement of postpetition
fees generated and expenses incurred, and to allow ASARCO to pay
those invoices on an interim basis in an amount not to exceed
$20,000 per month.

Christopher Linscott, a director at Keegan, attests that the firm
does not have or represent any interest adverse to ASARCO or its
estate on the matters for which Keegan is engaged as accountants.

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

The Debtor has five affiliates that filed for chapter 11
protection on April 11, 2005 (Bankr. S.D. Tex. Case Nos. 05-20521
through 05-20525).  They are Lac d'Amiante Du Quebec Ltee, CAPCO
Pipe Company, Inc., Cement Asbestos Products Company, Lake
Asbestos of Quebec, Ltd., and LAQ Canada, Ltd.  Details about
their asbestos-driven chapter 11 filings have appeared in the
Troubled Company Reporter since Apr. 18, 2005.

Encycle/Texas, Inc. (Bankr. S.D. Tex. Case No. 05-21304), Encycle,
Inc., and ASARCO Consulting, Inc. (Bankr. S.D. Tex. Case No.
05-21346) also filed for chapter 11 protection, and ASARCO has
asked that the three subsidiary cases be jointly administered with
its chapter 11 case.  (ASARCO Bankruptcy News, Issue No. 6;
Bankruptcy Creditors' Service, Inc., 215/945-7000).


ASARCO LLC: Wants to Reject Three Equipment Leases with CNB
-----------------------------------------------------------
On Mar. 1, 1991, ASARCO Inc. entered into a lease agreement with
the Connecticut National Bank, as Owner Trustee, for certain
mobile mining equipment and railroad rolling stock.  On the same
date, ASARCO Inc. entered into a Participation Agreement and a
Tax Indemnification Agreement, and on Apr. 18, 1991, it entered
into a Lease and Indenture Supplement No. 1.  On Feb. 17, 2005,
ASARCO Inc. was merged into ASARCO LLC, and, as a result,
ASARCO LLC is the successor to the Contracts.

By this motion, ASARCO seeks authority from the U.S. Bankruptcy
Court for the Southern District of Texas to reject the Contracts
effective as of Sept. 19, 2005.

ASARCO contends that the Contracts are of no material value to
its estate.  Moreover, it is unable to use the mobile mining
equipment and railroad rolling stock, so incurring liability
under the Contracts as an administrative expense is not in the
best interest of the estate.

ASARCO also says that it is actively seeking to minimize its
expenses during its reorganization cases and rejecting the
Contracts will help ASARCO lower its expenses further.

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

The Debtor has five affiliates that filed for chapter 11
protection on April 11, 2005 (Bankr. S.D. Tex. Case Nos. 05-20521
through 05-20525).  They are Lac d'Amiante Du Quebec Ltee, CAPCO
Pipe Company, Inc., Cement Asbestos Products Company, Lake
Asbestos of Quebec, Ltd., and LAQ Canada, Ltd.  Details about
their asbestos-driven chapter 11 filings have appeared in the
Troubled Company Reporter since Apr. 18, 2005.

Encycle/Texas, Inc. (Bankr. S.D. Tex. Case No. 05-21304), Encycle,
Inc., and ASARCO Consulting, Inc. (Bankr. S.D. Tex. Case No.
05-21346) also filed for chapter 11 protection, and ASARCO has
asked that the three subsidiary cases be jointly administered with
its chapter 11 case.  (ASARCO Bankruptcy News, Issue No. 6;
Bankruptcy Creditors' Service, Inc., 215/945-7000).


ASARCO LLC: Wants Until Jan. 13 to Decide on Leases
---------------------------------------------------
Pursuant to Section 365(d)(4) of the Bankruptcy Code, a debtor is
required to assume or reject unexpired leases of non-residential
real property to which it is a lessee within 60 days after the
date of the order for relief.  Otherwise, the leases are
automatically deemed rejected and the debtor must then
immediately surrender the premises to the lessor.  However, the
Bankruptcy Court may, for cause shown, grant an extension of that
period.

In determining whether cause exists for an extension of time for
the assumption or rejection of non-residential real property
leases under Section 365(d)(4), bankruptcy courts have
relied on several factors, including:

   (a) whether the case is exceptionally complex and involves a
       large number of leases;

   (b) whether the leases are the primary assets of the debtor;

   (c) whether the lessor continues to receive rental payments;

   (d) whether the debtor has had sufficient time to formulate a
       plan or reorganization; and

   (e) whether the debtor's continued occupation could damage the
       lessor beyond the compensation available under the
       Bankruptcy Code.

C. Luckey McDowell, Esq., at Baker Botts L.L.P., in Dallas,
Texas, relates that ASARCO LLC and its debtor-affiliates are
parties to a number of non-residential real property leases.  At
this time, the Debtors are in the process of determining whether
the Leases should be assumed or rejected.

Mr. McDowell explains that because they have focused their
efforts on various other demands inherent in large reorganization
cases, including responding to an on-going labor strike,
obtaining DIP financing, and developing a viable reorganization
plan, the Debtors have not yet been able to accurately evaluate
and weigh the benefits or burdens to their estates of assuming or
rejecting the Leases.  Without an evaluation, the Debtors would
be unable to articulate factors sufficient to make the required
showing to the Court that they have exercised reasonable business
judgment in determining whether to assume or reject the Leases.

Accordingly, the Debtors ask Judge Schmidt of the U.S. Bankruptcy
Court for the Southern District of Texas to extend their lease
decision period through Jan. 13, 2006.

The Debtors assure the Court that they are current on all of
their postpetition obligations under the Leases and will remain
so until the Leases are assumed or rejected.

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

The Debtor has five affiliates that filed for chapter 11
protection on April 11, 2005 (Bankr. S.D. Tex. Case Nos. 05-20521
through 05-20525).  They are Lac d'Amiante Du Quebec Ltee, CAPCO
Pipe Company, Inc., Cement Asbestos Products Company, Lake
Asbestos of Quebec, Ltd., and LAQ Canada, Ltd.  Details about
their asbestos-driven chapter 11 filings have appeared in the
Troubled Company Reporter since Apr. 18, 2005.

Encycle/Texas, Inc. (Bankr. S.D. Tex. Case No. 05-21304), Encycle,
Inc., and ASARCO Consulting, Inc. (Bankr. S.D. Tex. Case No.
05-21346) also filed for chapter 11 protection, and ASARCO has
asked that the three subsidiary cases be jointly administered with
its chapter 11 case.  (ASARCO Bankruptcy News, Issue No. 6;
Bankruptcy Creditors' Service, Inc., 215/945-7000).


ATA AIRLINES: U.S. Trustee Told to Appoint C8 Creditor to Panel
---------------------------------------------------------------
Having heard the arguments and considered the evidence presented
at the hearing held on Sept. 6, 2005, the U.S. Bankruptcy Court
for the Southern District of Indiana finds that:

  (1) The interests of the creditors of C8 Airlines, Inc.,
      formerly known as Chicago Express Airlines, Inc., are and
      have been adequately represented by the Official Committee
      of Unsecured Creditors, and the Committee is capable of
      investigating the issues raised by the Ad Hoc Committee for
      the benefit of C8 Airlines creditors;

  (2) Given the evidence that indicates that the estate of C8
      Airlines may be administratively insolvent, it would not be
      in the bests interests of C8 Airlines creditors at this
      time to authorize the appointment of a new committee when
      it may worsen the ability of the C8 estate to pay its
      administrative creditors or to provide any recovery beyond
      administrative creditors; and

  (3) The representation of the interests of the C8 Airlines
      creditors may be enhanced by the inclusion of a C8 trade
      creditor on the Creditors Committee.

Accordingly, the Court denies the Ad Hoc Committee's request for
appointment of a new committee.  The Ad Hoc Committee, however,
may re-file the request at a later time when it may be proven that
the C8 Estate is administratively solvent and that good cause then
exists for the relief requested.

The Court directs the U.S. Trustee to consider appointing a C8
trade creditor to the Official Committee of Unsecured Creditors.

As previously reported in the Troubled Company Reporter on
September 9, 2005, the Official Committee of Unsecured Creditors
opposed the request of the Ad Hoc Committee for the appointment of
an official creditors committee of Chicago Express Airlines, Inc.,
now known as C8 Airlines, Inc.

Headquartered in Indianapolis, Indiana, ATA Airlines, owned by ATA
Holdings Corp. -- http://www.ata.com/-- is the nation's 10th
largest passenger carrier (based on revenue passenger miles) and
one of the nation's largest low-fare carriers.  ATA has one of the
youngest, most fuel-efficient fleets among the major carriers,
featuring the new Boeing 737-800 and 757-300 aircraft.  The
airline operates significant scheduled service from Chicago-
Midway, Hawaii, Indianapolis, New York and San Francisco to over
40 business and vacation destinations.  Stock of parent company,
ATA Holdings Corp., is traded on the Nasdaq Stock Exchange.  The
Company and its debtor-affiliates filed for chapter 11 protection
on Oct. 26, 2004 (Bankr. S.D. Ind. Case Nos. 04-19866, 04-19868
through 04-19874).  Terry E. Hall, Esq., at Baker & Daniels,
represents the Debtors in their restructuring efforts.  When the
Debtors filed for protection from their creditors, they listed
$745,159,000 in total assets and $940,521,000 in total debts.
(ATA Airlines Bankruptcy News, Issue No. 35; Bankruptcy Creditors'
Service, Inc., 215/945-7000)


BSI HOLDING: Liquidation Trustee Wants to Delay Closing to Mar. 3
-----------------------------------------------------------------
Joseph E. Myers serves as the Liquidation Trustee of BSI Holdings
Liquidation Trust overseeing the liquidation of BSI Holding Co.,
Inc., formerly known as Bob's Stores, Inc.  Mr. Myers asks the
U.S. Bankruptcy Court for the District of Delaware for:

   (a) a new extension of the time to file a consolidated final
       report through and including Feb. 3, 2006, and

   (b) a new delay in entry of a final decree closing the Debtors'
       cases through and including Mar. 3, 2006.

As reported in the Troubled Company Reporter on May 10, 2005, the
Liquidation Trustee had asked the Court for:

   (a) an extension of the time to file a consolidated final
       report through and including September 15, 2005, and

   (b) a delay in entry of a final decree closing the Debtors'
       cases through and including October 15, 2005.

The Liquidation Trustee tells the Court that since the
Confirmation Date, he has made several distributions required in
accordance with the Plan.  The Liquidation Trustee further tells
the Court that a number of objections to claims are pending before
the Court, most of which are in the advanced stages.  Resolution
of these objections is needed in order to determine the claims and
amounts entitled to final distribution of the assets received from
the Debtors, Mr. Myers says.

Headquartered in Meriden, Connecticut, BSI Holding Co., Inc.,
formerly known as Bob's Stores, Inc., and its debtor-affiliates
operated a retail clothing chain.  The Debtors filed for chapter
11 protection on October 22, 2003 (Bankr. D. Del. Case No. 03-
13254).  At the time of filing, the casual clothing and footwear
chain operated 34 stores in six states throughout the Northeast.
The majority of the merchant's assets were subsequently acquired
by The TJX Companies, Framingham, Mass., for about $100 million
less various adjustments.  A liquidation trust was then
established to reconcile all remaining claims and liquidate the
retailer's estate.

Adam Hiller, Esq., at Pepper Hamilton represents the Debtors.  Jay
R. Indyke, Esq., at Kronish Lieb Weiner & Hellman LLP, and
Charlene Davis, Esq., and Deirdre Richards, Esq., at The Bayard
Firm represent the Creditors' Committee.  When the Company filed
for protection from its creditors, it listed debts and assets of
more than $100 million.  On Aug. 17, 2004, the Court confirmed the
Modified Consolidated Joint Plan of Liquidation of the Debtors and
that plan became effective on Sept. 15, 2004.


CANWEST GLOBAL: Gets Requisite Consents to Amend Senior Indentures
------------------------------------------------------------------
CanWest MediaWorks Inc., a wholly owned subsidiary of CanWest
Global Communications Corp., has received the consents required
for enactment of the indenture amendments proposed in its
previously announced cash tender offers and consent solicitations.
CanWest received valid and unrevoked consents from holders of more
than the required majorities in principal amount of each of the
two series of notes that were the subject of its offers:

   * CanWest's 10-5/8% Senior Subordinated Notes due 2011; and
   * its 7-5/8% Senior Unsecured Notes due 2013.

Following receipt of the necessary consents, CanWest executed
supplemental indentures implementing the amendments that the
consent solicitations approved, and those amendments are now
effective (though they will be revoked with retroactive effect if
settlement of the tender offers and consent solicitations fails to
occur).

The withdrawal deadline for the offers has now passed and holders
cannot withdraw any notes that they have tendered, or the related
consents that they have given, unless CanWest permits them to do
so.

The early tender premium deadline for the offers has now expired,
so that any holders that validly tender notes on or after
Sept. 22, 2005,will be paid only the purchase price less the early
tender premium for their notes, if the offer is consummated.

The expiration time has not been changed in respect of either
offer.  It remains midnight Eastern Daylight Time, on Oct. 12,
2005, subject to extension.

Citigroup Global Markets Inc. is the dealer manager and Global
Bondholder Services Corporation is the depositary and information
agent for the tender offers and consents solicitations.

Requests for documents relating to the tender offers and consent
solicitations may be directed to Global Bondholder Services
Corporation by telephone at 1-866 470-4500 (toll free) or
1-212-430-3774 or in writing at 65 Broadway, Suite 74, New York,
NY, 10006.  Questions regarding the tender offers and consent
solicitations may be directed to Citigroup Global Markets
Inc., Liability Management Group, at 1-800-558-3745 (toll free) or
1-212-723-6106 (collect).

CanWest MediaWorks Inc. is a wholly owned subsidiary of CanWest
Global Communications Corp. (NYSE: CWG; TSX: CGS.SV and CGS.NV) --
http://www.canwestglobal.com/-- an international media company.

CanWest Global Communications Corp., Canada's largest publisher of
daily newspapers, owns, operates and/or holds substantial
interests in newspapers, conventional television, out-of-home
advertising, specialty cable channels, radio networks and web
sites in Canada, New Zealand, Australia, and the Republic of
Ireland.

                         *     *     *

CanWest Global's 7-5/8% senior notes due 2013 carry Moody's
Investors Service's Ba3 rating and Standard and Poor's B- rating.


CARDIAC SERVICES: Wants CVG Approved as Valuation Expert
--------------------------------------------------------
Cardiac Services, Inc., asks the U.S. Bankruptcy Court for the
Middle District of Tennessee for authority to substitute the
appointment of a professional previously approved by the Court and
to clarify the terms of its compensation.

On August 16, 2005, the Debtor obtained the Court's permission to
retain Kraft & Company to assist it in drafting a chapter 11 plan.
Specifically, Kraft & Company was to consider financial issues
related to enterprise value and contributions of new value for
purposes of confirmation.

Kraft & Company now tells the Debtor that the financial analysis
it requires within a very short period of time conflicts with the
company's present workload and schedule.  In addition, Kraft was
concerned with the provisions in the Court's order approving its
employment which states that its professional fees will be
classified as an administrative expense.

The Debtor turned to Laroy W. Wolff, Jr., the president and CEO of
Centennial Valuation Group, LLC, to see if that firm could do the
work.

Mr. Wolff assured the Debtor his Firm can complete the work in the
required period.  What remains to be resolved is its compensation.

The Debtor selected Centennial because of its extensive experience
and knowledge in business evaluations and bankruptcy issues.  Mr.
Wolff is a certified public accountant, accredited in business
valuation, an accredited service appraiser, a certified valuation
analyst, a certified management accountant, and a certified fraud
examiner.

Centennial expresses its willingness to undertake the task if the
Debtor agrees to and the Court will approve its financial terms
and conditions:

     * receipt of a $5,000 retainer;

     * payment of 80% of its monthly billings plus expenses
       each month; and

     * interim and final approval of fees and expenses as
       required in 11 U.S.C. Section 330 and 331.

Headquartered in Nashville, Tennessee, Cardiac Services, Inc.,
provides surgical services, mobile catherization and peripheral
vascular labs, and associated equipment.  The Company filed for
chapter 11 protection on March 8, 2005 (Bankr. M.D. Tenn. Case No.
05-02813).  Paul E. Jennings, Esq., at Paul E. Jennings Law
Offices, P.C., represents the Debtor in its restructuring efforts.
When the Debtor filed for protection from its creditors, it
estimated assets and debts of $10 million to $50 million.


CARDIAC SERVICES: UST Wants CGV's Disinterestedness Affidavit
-------------------------------------------------------------
The United States Trustee for Region 8 asks the U.S. Bankrutpcy
Court for the Middle District of Tennessee to withhold approval of
Cardiac Services, Inc.'s request to retain Centennial Valuation
Group, LLC, as the Debtor's valuation professional in lieu of
Kraft & Company until CGV can and does attest to its
disinterestedness as required under 11 U.S.C. Sec. 327.

The Bankruptcy Court approved the retention of Kraft & Company to
assist Cardiac in the formulation of a chapter 11 plan.  In
particular, Kraft was to provide financial analysis of the
Debtor's enterprise value.  Kraft backed out of the agreement
after it learned that the valuation was needed in a very short
period of time its compensation would be classified as an
administrative expense.

The Debtor sought the services of another firm to provide a
valuation analysis in the period it requires.  Laroy W. Wolff,
Jr., Centennial Valuation's president and CEO, says his firm's
professionals can readily complete the valuation work the Debtor
needs.

The U.S. Trustee doesn't know if Mr. Wolff and his firm are
disinterested parties.  Court records doesn't show that Centennial
Valuation filed an affidavit attesting to its disinterestedness.

Headquartered in Nashville, Tennessee, Cardiac Services, Inc.,
provides surgical services, mobile catherization and peripheral
vascular labs, and associated equipment.  The Company filed for
chapter 11 protection on March 8, 2005 (Bankr. M.D. Tenn. Case No.
05-02813).  Paul E. Jennings, Esq., at Paul E. Jennings Law
Offices, P.C., represents the Debtor in its restructuring efforts.
When the Debtor filed for protection from its creditors, it
estimated assets and debts of $10 million to $50 million.


CATHOLIC CHURCH: Spokane Wants Avoidance Actions Stayed
-------------------------------------------------------
The Diocese of Spokane asks the U.S. Bankruptcy Court for the
Eastern District of Washington to stay any preference actions,
fraudulent transfer actions or other avoidance actions, pending
the appeal from the Court Orders in the "property of the estate
litigation."

"The [Diocese] seeks to avoid the inequity of litigating the
[Tort Litigants Committee's] alternative legal theories regarding
the property of the parishes and schools pending the appeal of the
Orders," Michael J. Paukert, Esq., at Paine, Hamblen, Coffin,
Brooke & Miller, LLP, in Spokane, Washington, tells the Court.

Rule 8005 of the Federal Rules of Bankruptcy Procedure provides
that:

    "A motion for a stay of the judgment, order, or decree of a
    bankruptcy judge, for approval of a supersedeas bond, or for
    other relief pending appeal must ordinarily be presented to
    the bankruptcy judge in the first instance.  Notwithstanding
    Rule 7062 but subject to the power of the district court and
    the bankruptcy appellate panel reserved hereinafter, the
    bankruptcy judge may suspend or order the continuation of
    other proceedings in the case under the Code or make any other
    appropriate order during the pendency of an appeal on such
    terms as will protect the rights of all parties in interest."

Mr. Paukert notes that a discretionary stay pursuant to Rule 8005
is appropriate if:

    (1) appellant is likely to succeed on the merits;
    (2) appellant will suffer irreparable injury;
    (3) no substantial harm will come to appellee; and
    (4) the stay will do no harm to the public interest.

             Equities Weigh in Favor of Granting Stay

Mr. Paukert tells Judge Williams that the Diocese and the
Association of Parishes presented a substantial case on the merits
involving a serious legal issue in the Property of the Estate
Litigation.  The issue of whether "the assets of parishes and
schools located within a Catholic Diocese must be included in the
Diocese's bankruptcy estate" is a matter of first impression
nationally and presents serious legal issues.

Mr. Paukert recounts that the Court recognized the seriousness of
the legal issues presented during oral argument by remarking that
the Court would likely be authoring nothing more than the "first
position paper for appeal."

Thus, Mr. Paukert believes that the equities weigh heavily in
favor of granting a limited stay.  If a stay is not granted, the
Diocese may be forced to litigate the Tort Litigants' alternative
legal theories, at the same time diminishing the estate without
good reason.

Mr. Paukert contends that there will be no harm to the Tort
Litigants if a stay is granted.  The Diocese and the Association
of Parishes pledge not to transfer or encumber any assets, other
than in the ordinary course of business or as allowed by Court
order following notice and hearing.  Also, the Diocese and the
Association of Parishes will maintain their assets in good
condition.  The status quo will be maintained and the interests of
the Tort Litigants, whatever they may be, will not be disturbed.

In contrast, Mr. Paukert notes, the concurrent litigation of the
Tort Litigants' alternative legal theories will harm the Diocese
and unnecessarily waste estate assets.

"There is simply no reason to incur attorneys' fees and costs in
connection with litigating avoidance claims at this time pending
appeal of the Property of the Estate Litigation," Mr. Paukert
says.  "Doing so will only drain the Debtor's estate of assets
that could be used for the resolution of claims."

Moreover, Mr. Paukert assures the Judge Williams that the stay
will affect only the Tort Litigants and the Diocese.  Granting a
stay pending appeal will have no impact on the public at large, he
adds.

                            *    *    *

As previously reported in the Troubled Company Reporter on
September 9, 2005, the Diocese of Spokane and 22 members of the
Association of Parishes in Washington filed separate notices
advising Judge Williams that they will take an appeal to the U.S.
District Court for the Eastern District of Washington from the
Bankruptcy Court's order granting the Committee of Tort Litigant's
request for partial summary judgment and finding that certain
properties that the Diocese "held for another" actually constitute
property of the Diocese's estate.

               Spokane & Parishes Want Order Stayed

The Diocese of Spokane, the Association of Parishes and the
related schools and ministries seek leave from the Bankruptcy
Court to file appeals from Judge Williams' Orders.

The 22 members of the Association of Parishes also ask the
Bankruptcy Court to stay the Orders pending the appeals.

Shaun M. Cross, Esq., at Paine, Hamblen, Coffin, Brooke & Miller,
LLP, in Spokane, Washington, explains that the Bankruptcy Court's
Orders are of great significance to the Diocese and other
defendants.  Unless reversed by an appellate court, the Orders
have the effect of creating a "law of the case" which would result
in the Diocese being forced to submit a plan of reorganization
that includes property in which it has no beneficial interest.

That plan, Mr. Cross points out, would pit the Diocese against the
true beneficial owners of the disputed property, the schools and
parishes, in violation of the civil and canonical trust
relationship between the Diocese, on the one hand, and the
parishes and schools on the other.

The Bankruptcy Court's decision will lead to the disruption of
Diocese's reorganization process and subject all non-debtors in
other bankruptcies to unrestricted litigation advanced by
creditors committees acting as de facto trustees, says John D.
Munding, Esq., at Crumb & Munding, P.S., in Spokane, Washington.

The Roman Catholic Church of the Diocese of Spokane filed for
chapter 11 protection (Bankr. E.D. Wash. Case No. 04-08822) on
Dec. 6, 2004.  Michael J. Paukert, Esq., at Paine, Hamblen,
Coffin, Brooke & Miller, LLP, represents the Spokane Diocese in
its restructuring efforts.  When the Debtor filed for protection
from its creditors, it listed $11,162,938 in total assets and
$81,364,055 in total debts. (Catholic Church Bankruptcy News,
Issue No. 43; Bankruptcy Creditors' Service, Inc., 215/945-7000)


CENTURY ALUMINUM: Inks New $100MM Sr. Sec. Revolving Credit Pact
----------------------------------------------------------------
Century Aluminum Company and certain of its direct and indirect
domestic subsidiaries entered into a new five-year $100 million
senior secured revolving credit facility with a syndicate of
lending institutions.

Bank of America, N.A. is the administrative agent under the New
Credit Facility.  The New Credit Facility, which expires on May
25, 2010, provides for borrowings of up to $100 million in the
aggregate, including up to $25.0 million under a letter of credit
sub-facility.  The New Credit Facility replaces the Company's
existing $100 million senior secured revolving credit facility.

No amounts have been borrowed under the New Credit Facility yet,
although the Borrowers may in the future use the New Credit
Facility to repay existing indebtedness, to issue standby or
commercial letters of credit, to finance permitted capital
expenditures and for ongoing working capital needs and other
general corporate purposes.

The Borrowers' obligations under the New Credit Facility are
guaranteed by certain of the Company's domestic subsidiaries and
secured by a first priority security interest in favor of the
Lenders in all of the Borrowers' accounts receivable, inventory
and certain bank accounts.

The availability of funds under the revolving credit facility is
limited by a specified borrowing base consisting of accounts
receivable and inventory, which meet customary eligibility
criteria.  Amounts outstanding under the revolving credit facility
bear interest, at the Company's option, at LIBOR or the Bank of
America base rate plus, in each case, an applicable interest
margin.

Affiliates of Credit Suisse, Cayman Branch and JPMorgan Chase
Bank, N.A., which are each a lender under the New Credit Facility,
and Bank of America, N.A., which is administrative agent and a
lender, have from time to time participated as underwriters or
initial purchasers in various offerings of the Company's
securities and have also provided financial advisory, commercial
banking and investment banking services for the Company in the
ordinary course of business for customary fees.

Century Aluminum Co. owns 615,000 metric tons per year (mtpy) of
primary aluminum capacity.  The company owns and operates a
244,000-mtpy plant at Hawesville, Kentucky, a 170,000-mtpy plant
at Ravenswood, West Virginia, and a 90,000-mtpy plant at
Grundartangi, Iceland.  Century also owns a 49.67-percent interest
in a 222,000-mtpy reduction plant at Mt. Holly, South Carolina.
Alcoa Inc. owns the remainder and is the operating partner.
Century's corporate offices are located in Monterey, California.

                         *     *     *

As reported in the Troubled Company Reporter on Dec. 7, 2004,
Moody's Investors Service assigned a B1 rating to Century Aluminum
Company's $175 million senior unsecured convertible notes due
2024.

These ratings were affirmed:

   * The Ba3 rating for Century's $100 million senior secured
     revolving credit facility,

   * The B1 rating for Century's $250 million 7.5% senior notes
     due 2014

   * Century's B1 senior implied rating, and

   * Century's B3 senior unsecured issuer rating.

As reported in the Troubled Company Reporter on Nov. 9, 2004,
Standard & Poor's Ratings Services raised its rating on Century
Aluminum Company's $150 million 1.75% convertible notes due 2024
to 'BB-' from 'B' and removed it from CreditWatch.  At the same
time, Standard & Poor's affirmed its 'BB-' corporate credit rating
on the Monterey, California-based company.


CIMAREX ENERGY: Moody's Assigns Ba3 Corporate Family Rating
-----------------------------------------------------------
Moody's assigned a Ba3 Corporate Family Rating to Cimarex Energy
Company, upgraded its Magnum Hunter (MHR) senior unsecured notes
to Ba3 from B2, and withdrew MHR's B1 Corporate Family Rating.
MHR's ratings had been under review for upgrade since the
announcement of the $2.2 billion acquisition of MHR by Cimarex.
The rating outlook is stable.

Debt free Cimarex assumed $634 million of MHR debt and capital
leases at the closing ($573 million as of June 30, 2005 and now
approximately $500 million) and issued 39.7 million common shares
in exchange for all MHR common stock.  The acquisition doubled
Cimarex' production and tripled its reserves.  All MHR debt now
resides at parent Cimarex.  Cimarex reports that essentially all
pro-forma reserves and production are held at the Cimarex level
and at subsidiaries guaranteeing the MHR notes.

Founded in 1992 by Mr. F. H. Merelli as Key Production Company,
Cimarex is the product a 2002 merger with Helmerich and Paynes's
upstream division, changing Key's name to Cimarex.  Mr. Merelli,
Cimarex' CEO, was the driving force and surviving chief executive
of both the Helmerich and MHR mergers.  Cimarex is an exploration
and production company with core properties located in:

   * the Mid-continent (38% of reserves; 37% of production);
   * Permian Basin (45%; 27%);
   * Gulf Coast (9%; 19%); and
   * the Gulf of Mexico (6%; 15%).

MHR added important scale, diversification, basin intensification,
and a longer reserve life to Cimarex' portfolio.  MHR's longer
lived Mid-continent reserves intensified Cimarex' existing core
holdings there and MHR's Permian Basin properties added an
important new core area of operations, with MHR's Southeast New
Mexico properties (Permian) central to Cimarex' interest in MHR.
Moody's is less enthusiastic with Cimarex' new presence in the
very short lived, very capital intensive, offshore Gulf of Mexico
region.

The removal of the notch between the senior note rating and the
Corporate Family Rating results in the two notch upgrade of the
notes.  The de-notching of the notes reflects Moody's current view
that Cimarex is likely to complete full repayment of its remaining
secured debt with proceeds from modest additional asset sales and
cash flow and Moody's view that Cimarex is likely to steer towards
its historic preference for sustained low leverage as it repays
its acquisition debt.  Moody's believe Cimarex' historic penchant
for lower leverage is prone to further materially reduce secured
debt near-term.

The notes would be re-notched if it appears that Cimarex'
accelerating internal capital budget and/or new acquisitions and
related funding begin to indicate sustained material borrowings
under its $500 million secured borrowing base bank revolver.
Since the second quarter 2005 closing and assumption of $270
million of bank debt, Cimarex reduced secured bank debt to $138
million with cash on hand, cash flow from operations, and the
proceeds of its initial divestiture (royalty interests).

Ratings support derives importantly from Moody's view that:

   * Cimarex is likely to hew to its long-standing low leverage
     strategy and culture;

   * focus over the next twelve months likely to be on assessing
     and re-ranking its post-acquisition project priorities; and

   * benefit from the flexibility provided by a longer lived,
     larger, more diversified proven developed (PD) reserve base.

Cimarex has also followed conservative reserve booking practices
in the past for proven undeveloped reserves, with its much larger
post-acquisition PUD position being inherited from MHR.  Cimarex
also reported at the time that it would likely chose to not book
all of MHR's PUD reserves.  Further support comes from Cimarex'
past practice of funding corporate acquisitions with all-stock
exchanges of common equity, though, as in MHR, the target may come
with material existing debt.

The ratings are partly restrained by Moody's view that during
Cimarex digestion period, it may take as long as a year or more to
determine if Cimarex' organic activity will consistently offset,
on a sequential quarter basis, its now much larger 34% proportion
of quick-decline Gulf Coast and Gulf of Mexico production.  Still,
while Moody's expects that the steep decline curves of those
properties will put a flat-to-down bias on production over the
next twelve months, Moody's also expects that capital spending
will be covered by flush up-cycle pre-capex cash flow.
Furthermore, the longer lived and, to a degree, lower risk Mid-
continent and Permian properties provide important risk
diversification balance to the relatively higher risk Gulf Coast
and Gulf of Mexico properties.

Ratings support is also seen in Moody's expectation of a:

   * post-acquisition inward focus on portfolio rationalization;
   * prospect evaluation and ranking; and
   * quick secured debt quick reduction.

Moody's anticipates divestitures in the range of $60 million
(already completed) to as much as $100 million, with proceeds used
to reduce debt.  Moody's expects that Cimarex will move quickly to
rank and exploit its substantially larger inventory of production
enhancement projects, take longer to evaluate its West Texas and
Gulf of Mexico prospects, and continue its tradition of internally
developed drilling prospects.

Specifically, the ratings are supported by:

   * substantial PD reserve scale;

   * a reasonably supportive PD reserve life of 6.6 years;

   * currently low leverage as measured by a comparatively low
     $2.45/BOE of Adjusted Debt per BOE of PD reserves;

   * important core holdings in the Mid-continent and
     Permian Basin;

   * intensified and added diversification of its core Gulf Coast
     holdings; and

   * internal capital allocation flexibility provide by the new
     fourth core holding of the Gulf of Mexico.

While the Gulf Coast and Gulf of Mexico holdings have inherently
short reserve lives, they add internal flexibility for the high
grading of drilling activity in a range of price environments.

The short-lived Gulf Coast and Gulf of Mexico holdings together
comprise 15% of reserves, 34% of production, and 50% of the 2005
and expected 2006 pro-forma capital budgets.  Importantly, the
high level of capital devoted to those holdings may not be very
credit accretive, especially if their proportion grows materially
in Cimarex' base.

The ratings are also restrained by Cimarex' high reserve
replacement costs, partly due to its strategy of pursuing fast
payout activity suitable to high price environments.  The
resulting short reserve lives and especially high reserve
replacement costs have so far been comfortably covered in recent
and expect price environments.  However, this strategy also
requires lower leverage than otherwise might be required by the
ratings.  It also remains to be seen how Cimarex' prospect
inventory can be managed to deliver lower reserve replacement
costs suitable to lower price environments.

Based on Cimarex' more conservative estimates of MHR reserves, it
paid $14/boe or $2.33/mcfe for MHR's reserves and approximately
$48,000/boe of daily MHR production.  The merged firm holds
approximately 233.5 mmboe of proven reserves, of which 191.3 mmboe
(82% of reserves) would be proven developed reserves.  Cimarex' PD
reserve life had been a comparatively short 5.2 years while MHR's
has been approximately 8.5 years.  The merged firm still has a
below average proven developed reserve life of approximately 6.6
years.

Cimarex' full-cycle costs are high, in the range of $29/BOE
(including capitalized G&A and capitalized interest), principally
reflecting its very high pro-forma three year average all-sources
finding and development costs of roughly $16.40/BOE.  While
Cimarex states that its high reserve replacement costs (over
$16/BOE before MHR) are partly due to its prospect selection
during a historically high price environment, it will be important
for those costs to moderate down when oil and gas prices moderate.

Moody's anticipates approximately $725 million to $750 million of
actual 2005 EBITDA, amply supporting actual capital spending and
interest expense.  In 2006, Moody's anticipates in the range of
$775 million to $850 million, due to moderating oil and gas prices
and flat-to-down production relative to current post-merger daily
production.  Moody's anticipates 2006 capital spending in the
range of $700 million to $800 million, depending on Cimarex' cash
flow expectations at the time, and interest expense in the range
of $30 million to $40 million (including capitalized interest),
depending on the degree of further debt reduction.

Cimarex Energy Co. is headquartered in Denver Colorado.


CONSTAR INTERNATIONAL: Has Access to $45.1-Mil from Revolver Funds
------------------------------------------------------------------
Constar International Inc. (NASDAQ: CNST) reported that as of
Sept. 21, 2005, the Company had drawn $10 million on its
$70 million revolving credit facility and outstanding letters of
credit totaled $11.9 million.

The collateral value supporting the facility, which the Company
determines monthly, exceeded the $70 million commitment as of
Aug. 31, 2005.  Therefore, as of Sept. 21, 2005, the Company's
availability under its revolver was $48.1 million.  Availability
at June 30, 2005 was $45.4 million.

Philadelphia-based Constar International is a leading global
producer of PET (polyethylene terephthalate) plastic containers
for food, soft drinks and water.  The Company provides full-
service packaging solutions, from product design and engineering,
to ongoing customer support.  Its customers include many of the
world's leading branded consumer products companies.

                         *     *     *

As reported in the Troubled Company Reporter on June 7, 2005,
Standard & Poor's Ratings Services lowered its corporate credit
rating on Constar International Inc. to 'B' from 'B+'.  The
downgrade follows the company's disappointing operating
performance in the first quarter of 2005, and lower than expected
trend in earnings and cash generation for the remainder of 2005,
which is likely to further weaken the company's very aggressive
financial profile.  Other ratings were also lowered.  S&P says the
outlook is negative.

As reported in the Troubled Company Reporter on Feb. 4, 2005,
Moody's Investors Service assigned a B2 rating to Constar
International Inc.'s proposed $210 million floating rate first
mortgage note, due 2012, and also affirmed existing debt ratings.
Concurrently, Moody's revised the ratings outlook to stable from
negative.

The rating actions Moody's took are:

   * Assigned B2 rating to the proposed $210 million floating rate
     first mortgage note, due 2012

   * Affirmed the existing Caa1 rating for the $173 million senior
     subordinated notes, due 2012

   * Affirmed B2 senior implied rating

   * Revised to B3 from Caa1, senior unsecured issuer rating (non-
     guaranteed exposure)

   * Moody's will withdraw the B2 rating for the first lien
     revolver, maturing 2007, and the term B loan, maturing 2009

   * Moody's will withdraw the B3 rating for the second lien term
     C loan, due 2010


CONSTAR INT'L: S&P Junks $395 Million Senior Notes' Ratings
-----------------------------------------------------------
Standard & Poor's Ratings Services lowered its corporate credit
rating on Constar International Inc. to 'B-' from 'B'.  At the
same time, Standard & Poor's lowered its rating on the company's
$220 million senior secured notes to 'CCC+' from 'B-' and its
rating on the $175 million senior subordinated notes to 'CCC' from
'CCC+'.

"The downgrade factors in the potential for a further weakening of
Constar's highly leveraged financial profile, because of
deterioration in cash flow and profitability this year and the
possibility of additional temporary margin pressure as a result of
rising raw-material costs," said Standard & Poor's credit analyst
Paul Kurias.

The outlook is negative.  Philadelphia, Pennsylvania-based Constar
had approximately $457 million in total debt outstanding at
June 30, 2005.

Constar's business profile is weak and reflects the company's
dependence on a narrow product line (containers for soft drinks
and water account for 80% of sales) and a high level of customer
concentration.  The largest customer -- PepsiCo Inc. -- accounts
for about 35% of revenues, and the top 10 customers contribute
about 75% of revenues, limiting pricing flexibility.

Margins have been lower than those of its rated peers, because of
a product-mix with emphasis on high-volume, commodity-type and
lower-margin containers for carbonated beverages.  In the first
half of 2005, margins were hurt by:

   * the ongoing impact of pricing concessions granted to extend
     customer contracts;

   * lower European volumes; and

   * increased transportation costs.

Constar's contracts allow the company to pass-through resin price
increases to its customers.  This factor should offer the company
some protection against recent and pending input price increases,
although even a temporary compression of margins could further
strain Constar's already stretched financial profile.

Constar is very aggressively leveraged with total debt (adjusted
for capitalized operating leases) to EBITDA of 7.4x at June 30,
2005, and EBITDA interest coverage of about 1.4x.

If the financial profile continues to deteriorate because of
weaker operating results this year, or liquidity deteriorates
because of further cost escalations or other business challenges,
ratings could be lowered again.  Conversely, the outlook could be
revised to stable if the company is able to reverse the downward
trend in operating margins and preserve satisfactory liquidity in
the face of pending cost increases.


CORNERSTONE PRODUCTS: Hires Wimmer as Restructuring Consultant
--------------------------------------------------------------
The U.S. Bankruptcy Court for the Eastern District of Texas,
Sherman Division, gave Cornerstone Products, Inc., authority to
retain Wimmer Associates, Inc., as its Restructuring Consultant.

The Debtor chose Wimmer Associates because of the Firm's extensive
experience and knowledge in the field of business restructurings
and reorganizations, and bankruptcy.  In this engagement, Wimmer
Associates will:

    a) assess the Debtor's strategic business plans, programs,
       information systems and decision-making processes;

    b) assess and recommend asset redeployment opportunities to
       improve Debtor's cash flow;

    c) assist with development and implementation of an action
       plan leading to refinancing, if appropriate;

    d) assist and advise the Debtor in connection with any
       potential sales of assets;

    e) assist the Debtor in the development of a plan of
       reorganization and in the preparation of an accompanying
       disclosure statement, any amendments to the plan or
       disclosure statement, and any related agreements and/or
       documents;

    f) testify at any hearings and/or trials as to one or more of
       the matters set forth herein as is determined to be
       necessary and/or appropriate; and

    g) perform all other restructuring consultation services to
       the Debtor in connection with this Chapter 11 case.

Lance P. Wimmer, the principal member of Wimmer Associates
presently designated to work on the engagement, charges $325 per
hour for his services.

In the event that the Debtor requests Wimmer Associates to obtain
financing or other cash infusion from sources not previously
contacted by the Debtor and the transaction is approved by the
Court and is consummated, the Firm will be entitled to an
additional fee equal to:

      a) 2% of any senior debt up to $5 million;

      b) 1% for any senior debt in excess of $5 million; and

      c) 49% of any subordinated debt or minority equity position
         in the Debtor;

The Debtor tells the Bankruptcy Court that Wimmer Associates
received a prepetition retainer of $25,000.

To the best of the Debtor's knowledge, Wimmer Associates does not
hold any interest adverse to the Debtor and is a "disinterested
person" as that term is defined in section 101(14) of the
Bankruptcy Code.

Headquartered in Plano, Texas, Cornerstone Products, Inc. --
http://www.cornerstoneproducts.com/-- manufactures custom
injection molded plastic products.  The Company filed for
chapter 11 protection on July 5, 2005 (Bankr. E.D. Tex. Case No.
05-43533).  Frank J. Wright, Esq., at Hance Scarborough Wright
Ginsberg & Brusilow, L.L.P., represents the Debtor in its
restructuring efforts.  When the Debtor filed for protection from
its creditors, it listed total assets of $59,595,144 and total
debts of $65,714,015.


CORNERSTONE PRODUCTS: Panel Objects to Sundance Payments
--------------------------------------------------------
The Official Committee of Unsecured Creditors of Cornerstone
Products, Inc., has questioned the appropriateness and
reasonableness of management fees the Debtor is paying to Sundance
Management.  The Committee asks the U.S Bankruptcy Court for the
Eastern District of Texas, Sherman Division, to cap further
payments to Sundance at $260,000 per year.

Judith W. Ross, Esq., of Baker Botts LLP, tells the Bankruptcy
Court that the Debtor continues to make weekly management fees
totaling $9,000, or $468,000 per year, to Sundance despite its
financial difficulties.  Ms. Ross claims that the management fees
collected by Sundance go directly to Reggie Sullivan, who is the
Debtor's majority shareholder, chief executive officer and
director.

                       The Contract

Prior to its bankruptcy filing, the Debtor hired Sundance to
organize a management team that would operate its business.  Under
this contract, Mr. Sullivan and other members of Sundance's team
received $260,000 per year for their services.

Despite the departure of the other members of the management team,
the Debtor continued to pay the full amount of the management fee
and eventually increased Mr. Sullivan's salary to $480,000 per
year.

Ms. Ross asks the Bankruptcy Court to set aside the management
contract unless Sundance and Mr. Sullivan can show the
reasonableness of their current fees.

Headquartered in Plano, Texas, Cornerstone Products, Inc. --
http://www.cornerstoneproducts.com/-- manufactures custom
injection molded plastic products.  The Company filed for
chapter 11 protection on July 5, 2005 (Bankr. E.D. Tex. Case No.
05-43533).  Frank J. Wright, Esq., at Hance Scarborough Wright
Ginsberg & Brusilow, L.L.P., represents the Debtor in its
restructuring efforts.  When the Debtor filed for protection from
its creditors, it listed total assets of $59,595,144 and total
debts of $65,714,015.


COTT CORP: Gets $4.9-Mil from Settlement of Antitrust Class Suit
----------------------------------------------------------------
Cott Corporation (NYSE:COT; TSX:BCB) received approximately
$4.9 million related to the settlement of a class action lawsuit
concerning price-fixing in the sale of high fructose corn syrup
(HFCS) purchased by the Company during the years 1991 to 1995.

The suit, styled "In re: High Fructose Corn Syrup Antitrust
Litigation Master File No. 95-1477," filed in the United States
District Court for the Central District of Illinois," relates to
purchases of high fructose corn syrup made by the Company and
others.

About 20 corn syrup buyers initially filed the suit in
the United States District Court for the Central District of
Illinois against several corn processors, alleging that they
violated antitrust laws from 1988 to 1995 by conspiring to
artificially inflate the price of high fructose corn syrup.
About 2,000 plaintiffs joined the suit, including Coca-Cola Co.,
PepsiCo Inc., Kraft Foods Inc. and Quaker Oats, an earlier Class
Action Reporter story (July 30,2004) states.

In July 2004, the parties in the suit forged a $531 million
settlement for the suit.  The settlement amount was allocated to
each class action recipient based on the proportion of its
purchases of high fructose corn syrup from these suppliers
during the period 1991 through 1995 to the total of such
purchases by all class action recipients.

Cott Corporation is the world's largest retailer brand soft drink
supplier.  Its core markets are the United States, Canada and the
United Kingdom. (Class Action Reporter, September 23, 2005)

                         *     *     *

As reported in the Troubled Company Reporter on Sept. 23, 2005,
Standard & Poor's Ratings Services placed its 'BB' long-term
corporate credit rating and 'B+' subordinated debt rating on the
leading supplier of retailer-branded soft drinks, Toronto, Ont.-
based Cott Corp., on CreditWatch with negative implications.

As reported in the Troubled Company Reporter on Sept. 23, 2005,
Moody's Investors Service placed the ratings for Cott Corporation
under review for possible downgrade following the announcement
that it expects 2005 earnings to be substantially lower than
previous guidance.

These ratings were placed on review for possible downgrade:

  Cott Corporation:

     -- Ba2 corporate family rating

  Cott Beverages, Inc.:

     -- Ba3 rating on the $275 million 8% senior subordinated
        notes, due 2011

The review for possible downgrade will focus on:

   * the impact that the above pressures will have on the
     company's operating profit;

   * cash flow and debt protection measures going forward; and

   * the company's plans for cost reduction efforts and pricing.


COTT CORP: Says 2005 Earnings Will Be Substantially Below Guidance
------------------------------------------------------------------
Cott Corporation (NYSE:COT; TSX:BCB) expects its 2005 earnings to
be substantially below previously announced guidance.  Earnings
are being impacted by continued carbonated soft drink volume
softness in the U.S., product mix shift towards lower margin
bottled water and escalating raw material costs.

"The entire soft drink industry is dealing with the impact of
rising PET costs," commented John Sheppard, President and Chief
Executive Officer of Cott.  "When we add this to the changes we
are seeing in the market and our ongoing operational challenges,
we expect a substantial impact on our full-year results."

The Company withdrew its previous financial guidance and did not
provide revised guidance for 2005 as it is currently reviewing a
number of initiatives to cover cost increases and streamline
operations while delivering improved customer service.

"Over the years, Cott has demonstrated its ability to change in
order to deliver long term shareowner growth," added Mr. Sheppard.
"The management team is focused on taking quick and decisive
action to address the current challenges."

Cott Corporation is the world's largest retailer brand soft drink
supplier.  Its core markets are the United States, Canada and the
United Kingdom.

                         *     *     *

As reported in the Troubled Company Reporter on Sept. 23, 2005,
Standard & Poor's Ratings Services placed its 'BB' long-term
corporate credit rating and 'B+' subordinated debt rating on the
leading supplier of retailer-branded soft drinks, Toronto, Ont.-
based Cott Corp., on CreditWatch with negative implications.

As reported in the Troubled Company Reporter on Sept. 23, 2005,
Moody's Investors Service placed the ratings for Cott Corporation
under review for possible downgrade following the announcement
that it expects 2005 earnings to be substantially lower than
previous guidance.

These ratings were placed on review for possible downgrade:

  Cott Corporation:

     -- Ba2 corporate family rating

  Cott Beverages, Inc.:

     -- Ba3 rating on the $275 million 8% senior subordinated
        notes, due 2011

The review for possible downgrade will focus on:

   * the impact that the above pressures will have on the
     company's operating profit;

   * cash flow and debt protection measures going forward; and

   * the company's plans for cost reduction efforts and pricing.


DELTA AIR: Court Okays Payments Under Critical Carrier Agreements
-----------------------------------------------------------------
Pursuant to Section 105 of the Bankruptcy Code, the Delta Air
Lines Inc. and its debtor-affiliates sought and obtained the U.S.
Bankruptcy Court for the Southern District of New York's
permission, on an interim basis, to honor their prepetition
obligations and to continue honoring, performing and exercising
their rights and obligations under 12 sets of agreements.

Marshall S. Huebner, Esq., at Davis Polk & Wardwell, in New York,
tells the Court that the Agreements are critical to the Debtors'
operations.  If the Debtors do not pay their prepetition
obligations relating to the Agreements in the ordinary course of
business, the counterparties may have no incentive to continue to
provide services to the Debtors or may attempt unilateral self-
help measures to protect their interests.

A. SkyTeam Alliance Agreements and US Cargo Sales Joint Venture
   Agreement

Prior to the Petition Date, the Debtors entered into a series of
bilateral and multilateral agreements for cooperative marketing
efforts with eight carriers:

   -- Air France,
   -- AeroMexico,
   -- Korean Air,
   -- CSA Czech Airlines,
   -- Alitalia,
   -- Continental Airlines,
   -- Northwest Airlines and
   -- KLM Royal Dutch Airlines.

The SkyTeam Alliance Agreements provide numerous benefits to the
Debtors and their customers, including reciprocal code share
arrangements, the ability of the Debtors' customers to accrue and
redeem frequent flyer miles on flights of other SkyTeam Alliance
members, reciprocal airport lounge access and cargo services.
The Debtors generate approximately $209 million per year as a
result of being a member of the SkyTeam Alliance.

The Debtors also, along with SkyTeam Alliance participants Air
France and Korean Air in August 2001, entered into an agreement to
jointly form a limited liability company to exclusively market all
U.S. export air freight capacity of the Members.  The purpose of
the joint venture is to combine the Members' existing network and
sales strengths in order to increase service offerings, enhance
revenue opportunities, reduce costs and improve competitiveness in
the U.S. export air freight industry.  The joint venture acts as
the exclusive general sales agent of each of the Members in the
United States for their U.S. export freight capacity; thus, the
Debtors rely on the Joint Venture as sole sales agent for U.S.
export air freight capacity.

For the twelve months ending June 30, 2005, the Joint Venture, as
Debtors' U.S. export air freight sales agent, generated
approximately $78.1 million in air freight revenue for the
Debtors.

B. Domestic Alliance Agreements

Prior to the Petition Date, the Debtors entered into a series of
bilateral and multilateral agreements with Continental Airlines,
Inc., and Northwest Airlines, Inc., and Alaska Airlines, Inc., for
cooperative marketing efforts.  The Domestic Alliance Agreements
provide numerous benefits to the Debtors and their customers,
including reciprocal code share arrangements, the ability for the
Debtors' customers to accrue and redeem frequent flyer miles on
flights of the Domestic Alliance Airlines and have reciprocal
airport lounge access.  The Debtors generate in excess of $90.9
million per year as a result of the Agreements.

C. Code Share Agreements

The Debtors have air service agreements with certain commuter and
other airlines, other than the SkyTeam Alliance Airlines and the
Domestic Alliance Airlines, including, but not limited to, Air
Jamaica, Avianca, China Airlines, China Southern, El Al Israel
Airlines, Horizon, Royal Air Moroc, and South African Airways,
whereby the airlines offer air transportation of passengers and
cargo between certain airports and the Debtors' hub airports.

The average net passenger revenue per month for the twelve months
ending June 30, 2005, under the Code Share Agreements is
approximately $3.23 million.  Additionally, the Debtors realize
valuable connecting revenue from the Code Share Agreements, which
is generated by passengers connecting from a Code Share Airline
flight to a Delta flight.

D. GDS Agreements

The Debtors are parties to several participation carrier
agreements with various global distribution systems, including
Worldspan, Sabre, Amadeus Global Travel Distribution, Galileo,
Topas, Axxess, INFINI, Abacus and others.  Global Distribution
Systems are computer systems, networks and databases that store,
process and distribute information about available passenger air
transportation.  The Global Distribution Systems enable travel
agents to accept and record bookings of those services from remote
locations.  In addition to storing information, the Systems also
allow travel agents to make and confirm reservations, price and
issue tickets automatically, and do the travel agencies' internal
accounting.

Airline ticket sales made through travel agents comprise
approximately 70% of the Debtors' air passenger transportation
sales volume.  Almost all travel agents in the United States
subscribe to Global Distribution Systems.

The obligations incurred under the GDS Participation Carrier
Agreements are paid through the IATA Clearinghouse, and the
Airlines Clearing House, Inc.  For the six months ending June 30,
2005, the Debtors on average owed approximately $32 million per
month pursuant to the GDS Participation Carrier Agreements.  The
Global Distribution Systems monthly charges are paid through the
Clearinghouses, generally two months after the charges are
incurred.

E. Travel Agency Agreements

The Debtors are parties to various agreements related to their
travel agency network, including:

   (a) backend incentive agreements,
   (b) volume-based incentive agreements,
   (c) point-of-sale agreements,
   (d) block seat agreements,
   (e) online agency agreements,
   (f) opaque channel agreements,
   (g) general sales agents agreements and
   (h) the supplier link agreement.

Consistent with most other airlines, the Debtors sell their
tickets directly and through travel agents, which sold 70% of the
Debtors' tickets in 2004.

In the past, the Debtors generally paid travel agents a base
commission payment for each ticket sold based on a percentage of
the ticket price up to a pre-set maximum amount.  However, the
Debtors essentially eliminated the base commission incentive
structure and established a system based on backend performance-
based payments.  By early 2002, substantially all domestic travel
agents with which the Debtors have agreements had been switched to
performance-based backend incentive payments.  Further, the
Debtors generally no longer pay a base commission to travel agents
located outside the United States and Canada for sales of tickets
for travel originating in the United States and Canada.

Under these agreements, the travel agency is required to establish
the Debtors as a preferred air carrier and actively promote the
Debtors' services.  In turn, the agency is entitled to a quarterly
incentive award, paid directly by the Debtors to the agency in
arrears after the close of the applicable calendar quarter, based
on their performance during the quarter.

Certain foreign and online travel agents are also parties to
agreements with the Debtors, which provide volume-based
incentives.  Under these Volume-Based Incentive Agreements, the
travel agency is entitled to a quarterly incentive award, paid
directly by the Debtors to the agency in arrears after the close
of the applicable calendar quarter, based on the travel agency's
achieving a revenue growth target for the applicable period.

The Debtors pay travel agents under Backend and Volume-Based
Incentive Agreements quarterly.  Incentive payments are generally
made directly to the agents by the Debtors in the second month
following the close of the applicable quarter.  For the 1st
quarter of 2005, the Debtors' obligation under the Backend
Incentive Agreements and Volume-Based Incentive Agreements was
approximately $20 million.  The revenue generated from the travel
agencies with Backend and Volume-Based Incentive Agreements during
the same period was approximately $1.37 billion.

A smaller number of the travel agencies with which the Debtors
have agreements are potentially entitled to certain bonus
payments.  The Point-of-Sale Agreements are normally in addition
to the backend and volume-based payments.  These bonuses are
normally provided only for specific origination and destination
pairings that are targeted to achieve certain goals, including
improving the Debtors' performance on underperforming routes, and
are provided to certain travel agencies based on the geographic
market in which the specific travel agency operates.

The Debtors also have agreements pursuant to which certain travel
agents and other parties have the right to sell blocks of seats on
certain flights.  These parties fall into four general categories:

   (a) cruise line operators,
   (b) group travel providers,
   (c) European tour operators and
   (d) charter flight groups.

During the prime cruise travel season, Block Seat Agreements with
cruise line operators account for a significant volume of seats.

The Debtors have agreements with CheapTickets, Expedia,
Travelocity and Orbitz, for sales of the Debtors' tickets over the
Internet.  Under the Online Agency Agreements, the online agencies
are entitled to transaction fees for each ticket sold, which vary
by agency.  The online agencies also agree to pay the Debtors'
Global Distribution Systems fees in exchange for access and
authority to sell the Debtors' fares that are available over the
Internet.  These agreements substantially reduce the Debtors'
Global Distribution Systems fees.

Additionally, the Debtors sell tickets through certain opaque
online travel agents, including Priceline.com and Hotwire.
Under the Opaque Channel Agreements, the Debtors sell certain
tickets, generally distressed inventory, to the online travel
agents, who in turn sell to the public based on time of travel and
origination and destination information, without revealing the
name of the carrier.  The online travel agent retains the
difference between the Debtors' sale price and the price the
online travel agent receives from its customer.

Settlements under the Point-of-Sale Agreements, Block Seat
Agreements, Online Agency Agreements and Opaque Channel
Agreements are weekly, on Wednesday, through ARC, and are made 10
days in arrears.  For the first and second quarters of 2005,
commissions paid under these agreements averaged approximately
$879,510 per week.  While commissions for the two quarters total
approximately $22.9 million, the revenue generated from the travel
agencies with Point-of-Sale Agreements, Block Seat Agreements,
Online Agency Agreements and Opaque Channel Agreements was in
excess of $4.57 billion.

The Debtors have sales representation agreements with various
entities known as general sales agents under which the Debtors
have made each GSA its exclusive sales agent in a particular
geographic region.  The purpose of the GSA Agreements is to allow
the Debtors to sell tickets in foreign locations not normally
serviced by the Debtors.  The services of the GSAs allow the
Debtors to realize ticket sales through the issuance of multi-
carrier itineraries.  In return, the GSAs generally are
compensated by way of commissions on their ticket sales.  For the
six months ending May 31, 2005, GSA commissions averaged
approximately $995,000 per month.  Commissions are generally paid
two months after they are earned.  The revenue generated from the
GSA Agreements during the 1st quarter of 2005 was approximately
$89 million.

The Debtors also have agreements with Orbitz and G2 Switchworks,
under which Orbitz and G2 book tickets directly through the
Debtors' reservation system.  The Supplier Link Agreements will
provide a lower cost alternative to traditional booking channels
and will result in significant cost savings for the Debtors.

F. Cargo Agency Agreements

The Debtors' cargo services use general sales agents pursuant to
certain agreements with the Debtors in the United States and
abroad.  The Cargo GSAs are generally paid monthly.  For the six
months ending June 30, 2005, the Debtors' payments under the
Cargo GSA Agreements equal approximately $1.01 million per month.
In 2004, the Debtors generated approximately $173.2 in revenue
directly attributable to the use of Cargo GSAs.

G. TSI Agreements

The Debtors have agreements with Transportation Solutions, Inc.,
whereby TSI acts as a financial clearinghouse for the Debtors for
billings, payments and the related administration of ground
transportation services for air cargo.  In this clearinghouse
role, TSI aggregates and settles charges between the Debtors and
approximately 50 motor carrier providers that transport customer
cargo throughout the United States.  In addition to air cargo
customers, TSI also acts as a clearinghouse for payments to
truckers in connection with the ground transportation of aircraft
parts, engines and other related materials necessary for the
maintenance of the Debtors aircraft fleet.

H. In-To Plane Service Company Claims

The Debtors want to honor the claims of suppliers of aircraft
fueling, ground handling, and aircraft cleaning services.  The
Debtors' arrangements with In-to Plane Service Companies obviate
the need to have separate personnel and facilities devoted to
these services at each airport to which a carrier flies.

I. Technical Services Sales Agents

The Debtors perform certain aircraft and engine maintenance
activities for third party customers.  The provision of Technical
Services provides substantial revenue to the Debtors and is an
essential part of the Debtors business.

In an effort to maximize the Debtors' revenue from providing
Technical Services and to ensure continued use of personnel and
assets used to provide Technical Services, the Debtors have
engaged the services of Technical Services sales agents,
worldwide, to assist the Debtors in securing customers for the
Debtors Technical Services.

Pursuant to certain arrangements, Sales Agents are paid on a
commission basis, derived as a percentage of the net revenues
received by the Debtors from customers secured by the Sales
Agent.  In addition to the commission structure, in certain cases,
Sales Agents are reimbursed for necessary and pre-approved
expenses.

J. ATPCO Agreement

Airline Tariff Publishing Company facilitates the publication of
airline tariff filings that are communicated by ATPCO to ticket
vendors pursuant to an ATPCO Agreement.

The Debtors rely on ATPCO to distribute changes to the Debtors'
fares and rules to global distribution systems in a timely manner.
ATPCO also files fares for the Debtors with government
authorities, as is required for all airlines.  The Debtors' cargo
division also utilizes ATPCO to file domestic freight tariffs and
rates.

The obligations incurred under the ATPCO Agreement are paid
through the Clearinghouses.  For the six months ending May 31,
2005, the Debtors average monthly obligation to ATPCO was
approximately $200,000.  Fees to ATPCO are generally paid two
months after they are earned.

K. Foreign Deeds of Undertaking

The Debtors are parties to certain foreign deeds of undertaking,
pursuant to which they are obligated to provide holders of the
Debtors' tickets with assurance that, should the issuer of the
ticket fail to remit money to the Debtors paid by the customer to
the travel agent, the Debtors will nonetheless honor the ticket.
As of the Petition Date, the Debtors do not have unpaid
obligations under the Foreign Deeds of Undertaking.

L. The SAFI Arrangement

Pursuant to certain aviation requirements in the United Kingdom,
air travel organizers are required to carry Scheduled Airline
Failure Insurance to protect the public against, among other
things, the failure of an airline.

Mr. Huebner notes that, although airlines are not parties to SAFI
policies, certain actions taken by airlines, including the filing
of a Chapter 11 petition, can invalidate the policies.  If the
policies are deemed to be ineffective, the Air Travel Organizers
will not be able to protect consumers against the subsequent
failure of an airline and, therefore, may immediately stop selling
tickets for air travel on any airline that has filed for relief
under Chapter 11 or may file for bankruptcy relief in the future.

Because the Debtors' ability to sell tickets in the United
Kingdom is essential to their successful reorganization, the
Debtors brokered a prepetition arrangement with International
Passenger Protection Limited to prevent the cancellation of SAFI
coverage for certain of the Debtors' Air Travel Organizers.
Under the SAFI Arrangement, the Debtors collateralized the risk
undertaken by IPP by placing GBP3.585 million in an escrow account
on September 9, 2005, which will be returned to the Debtors 30
days after their emergence from Chapter 11.

For the twelve months ended July 31, 2005, revenue from United
Kingdom travel agent sales total GBP80,338,336.

Headquartered in Atlanta, Georgia, Delta Air Lines --
http://www.delta.com/-- is the world's second-largest airline in
terms of passengers carried and the leading U.S. carrier across
the Atlantic, offering daily flights to 502 destinations in 88
countries on Delta, Song, Delta Shuttle, the Delta Connection
carriers and its worldwide partners.  The Company and 18
affiliates filed for chapter 11 protection on Sept. 14, 2005
(Bankr. S.D.N.Y. Lead Case No. 05-17923).  Marshall S. Huebner,
Esq., at Davis Polk & Wardwell, represents the Debtors in their
restructuring efforts.  As of June 30, 2005, the Company's balance
sheet showed $21.5 billion in assets and $28.5 billion in
liabilities.  (Delta Air Lines Bankruptcy News, Issue No. 3;
Bankruptcy Creditors' Service, Inc., 215/945-7000)


DELTA AIR: Court Okays Payment of Prepetition Taxes & Fees
----------------------------------------------------------
In connection with the normal operations of their business, the
Delta Air Lines Inc. and its debtor-affiliates collect, withhold
and incur sales, use, transportation, excise, fuel and employment
taxes, as well as other fees and charges.  The Debtors then remit
those taxes to various federal, state and local government, and
taxing, licensing and airport authorities, usually on a periodic
basis.

The Debtors established two accounts to pay the Covered Taxes and
Fees to the Governmental Authorities.  The Debtors held a separate
account for passenger facility charges collected.

The Debtors will not grant to any third party any security or
other interest in the funds to those Accounts.

A. Transportation Taxes

Pursuant to Sections 4261 and 4271 of the Internal Revenue Code,
the Debtors are responsible for the collection of:

   (i) a 7.5% excise tax on the sale of each air travel passenger
       ticket and each sale of frequent flyer awards,

  (ii) a $17 to $14.10 excise tax in connection with any travel
       beginning and ending in the United States;

(iii) a $3.20 segment fee for each domestic segment of paid
       travel; and

  (iv) a 6.25% excise tax on the amount paid for the
       transportation of property by air that begins or ends in
       the United States.

Approximately $105 million of the air transportation taxes
incurred prepetition remain deposited in the Covered Taxes and
Fees Account and have yet to be remitted to the Governmental
Authorities.

B. Airport Fees and Passenger Charges

The Debtors are responsible for the collection of various taxes
related to customs, immigration, passenger services and security
including, without limitation, fees for inspection of
international passengers, baggage and cargo.

Approximately $111 million of these types of taxes collected
during the prepetition period have not yet been remitted to the
Governmental Authorities:

         Type                              Amount
         -----                             ------
         Custom Fees                    $4,000,000
         Immigration Inspection Fee      9,000,000
         APHIS Fees                      6,000,000
         Passenger Facility Charges     51,000,000
         Security Fees                 $41,000,000

C. Fuel Taxes

The Internal Revenue Code imposes excise taxes on the purchase of
diesel fuel, gasoline and aviation fuels.  These fuel taxes must
be remitted to the Internal Revenue Service on a periodic basis.

Approximately $5 million of the fuel taxes incurred and collected
prepetition remains deposited into the Covered Taxes Account and
have yet to be remitted to the Governmental Authorities.

D. Sales and Use and Other Taxes

The Debtors collect or incur various general sales and use taxes.
Approximately $14 million in unremitted prepetition sales and use
taxes remain deposited in the Covered Taxes and Fees Account.

The Debtors also collect, withhold or incur various other taxes,
fees and charges, including backup withholding under Section 3406
of the Internal Revenue Code, withholding on certain payments to
foreign persons, state and local taxes imposed on overall gross
receipts, state and local fuel excise taxes, hotel occupancy
taxes, charges in connection with the importation of goods,
business and liquor license fees and other similar federal, state
or local taxes, charges and fees.  Approximately $6 million in the
Other Taxes collected and withheld prepetition remain deposited in
the Covered Taxes and Fees Account and unremitted to the
Governmental Authorities.

E. Employment and Wage-Related Taxes

The Debtors are required by law to withhold from domestic
employees' wages various amounts related to federal, state and
local taxes.  These taxes include, but are not limited to, income
taxes, FICA Taxes, unemployment taxes and similar state, local and
federal taxes that accrue on wages, benefits, disability and
workers compensation paid to the Debtors' employees.

Approximately $60 million in various Employment and Wage-Related
Taxes have been withheld by the Debtors and remitted to the Third-
Party Processor before the Petition Date.

The Third-Party Processor will remit the amounts to the
Governmental Authorities as they come due and at the directive of
the Court.

                  Taxes Not Property of Estates

Marshall S. Huebner, Esq., at Davis Polk & Wardwell, in New York,
notes that most of the Covered Taxes and Fees collected
prepetition are not property of the Debtors estates, and must be
turned over to the Governmental Authorities.

Mr. Huebner adds that the Covered Taxes and Fees must be remitted
to the Governmental Authorities to forestall the Authorities from
taking actions that might interfere with the Debtors' successful
reorganization, including possibly bringing personal liability
actions against directors, officers and other employees with
respect to any non-remittance.

Pursuant to Sections 105(a) and 363(b) of the Bankruptcy Code, the
Debtors seek authorization to pay any prepetition Covered Taxes
and Fees when they come due.

The Debtors also ask the U.S. Bankruptcy Court for the Southern
District of New York to direct the Banks to receive, process,
honor and pay the checks or electronic transfers used for the
Covered Taxes and Fees.

                          *     *     *

The Court approves the Debtors' request.

Headquartered in Atlanta, Georgia, Delta Air Lines --
http://www.delta.com/-- is the world's second-largest airline in
terms of passengers carried and the leading U.S. carrier across
the Atlantic, offering daily flights to 502 destinations in 88
countries on Delta, Song, Delta Shuttle, the Delta Connection
carriers and its worldwide partners.  The Company and 18
affiliates filed for chapter 11 protection on Sept. 14, 2005
(Bankr. S.D.N.Y. Lead Case No. 05-17923).  Marshall S. Huebner,
Esq., at Davis Polk & Wardwell, represents the Debtors in their
restructuring efforts.  As of June 30, 2005, the Company's balance
sheet showed $21.5 billion in assets and $28.5 billion in
liabilities.  (Delta Air Lines Bankruptcy News, Issue No. 3;
Bankruptcy Creditors' Service, Inc., 215/945-7000)


DELTA AIR: Retired Pilots Want Sec. 1114 Committee Appointed
------------------------------------------------------------
DP3, Inc., doing business as Delta Pilots' Pension Preservation
Organization, asks the U.S. Bankruptcy Court for the Southern
District of New York to appoint an Official Committee of Retired
Pilots to act as the authorized representative for the retired
pilots of Delta Air Lines, Inc.

Dean Booth, Esq., at Schreeder, Wheeler & Flint, LLP, in Atlanta,
Georgia, relates that Delta has approximately 4,500 retired
pilots, survivors and dependents who are receiving medical, dental
and other retirement benefits, along with pension benefits arising
from collective bargaining agreements.  These creditors hold
claims estimated to aggregate over $500 million.

Given Delta's recent lobbying efforts concerning pension plan
relief and the focus on retiree pension and benefits in other
recent airline bankruptcies, it is critical for the Court to
appoint a committee to represent the interests of retired pilots,
Mr. Booth asserts.

Mr. Booth explains that the retired pilots need to protect their
rights and interests in the likely event that Delta Air Lines,
Inc., initiates proceedings to terminate or modify pension or
retiree benefits under Section 1113 or 1114 of the Bankruptcy
Code.  In addition, Mr. Booth says, they need to be heard with
respect to issues relating to debtor-in-possession financing and
other issues presented early on in the case that may very well
affect them.

Mr. Booth asserts that the loss of retirement benefits can have a
devastating impact on retirees and their families who are, by
definition, on fixed income.

Section 1114(c)(1) of the Bankruptcy Code states that a labor
organization will be the authorized representative of persons
receiving retiree benefits unless the labor organization:

    (1) elects not to serve as the authorized representative, or

    (2) the court determines that different representation is
        appropriate.

Section 1114(c)(2) provides that when a labor organization will
not be acting as the authorized representative of retirees, "the
court, upon a motion by a party in interest, and after notice and
a hearing, will appoint a committee of retired employees if the
Debtor seeks to modify or not pay the retiree benefits or if the
court otherwise determines that it is appropriate . . ."

DP3 expects that the labor organization representing Delta's
active pilots, the Air Line Pilots Association, International,
will take the position that it does not represent the retired
pilots in the Debtors' bankruptcy proceedings.

Mr. Booth notes that unlike many other legacy airlines that have a
fully unionized work force, Delta is unique because the pilots are
its only unionized group of employees.  The retired pilots are the
only group of Delta retirees whose retirement benefits are
provided under a CBA, Mr. Booth points out.

He relates that this critical distinction was recognized by the
court in the Chapter 11 case of Continental Air Lines, Inc., in
which the court appointed separate committees for union and non-
unionized employees.

Given their number and the magnitude of their claims, the retirees
are entitled to be heard in a unified manner, rather than forcing
each retired pilot, albeit with similar interests, to engage
independent counsel at great expense, Mr. Booth avers.

Headquartered in Atlanta, Georgia, Delta Air Lines --
http://www.delta.com/-- is the world's second-largest airline in
terms of passengers carried and the leading U.S. carrier across
the Atlantic, offering daily flights to 502 destinations in 88
countries on Delta, Song, Delta Shuttle, the Delta Connection
carriers and its worldwide partners.  The Company and 18
affiliates filed for chapter 11 protection on Sept. 14, 2005
(Bankr. S.D.N.Y. Lead Case No. 05-17923).  Marshall S. Huebner,
Esq., at Davis Polk & Wardwell, represents the Debtors in their
restructuring efforts.  As of June 30, 2005, the Company's balance
sheet showed $21.5 billion in assets and $28.5 billion in
liabilities.  (Delta Air Lines Bankruptcy News, Issue No. 3;
Bankruptcy Creditors' Service, Inc., 215/945-7000)


DERIVIUM CAPITAL: Files Schedules of Assets and Liabilities
-----------------------------------------------------------
Derivium Capital LLC delivered its Schedules of Assets and
Liabilities to the U.S. Bankruptcy Court for the Southern District
of New York, disclosing:

   Name of Schedule               Assets          Liabilities
   ----------------               ------          -----------
A. Real Property                 $257,000
B. Personal Property          $51,223,278.29
C. Property Claimed
   As Exempt
D. Creditor Holding                              $19,660,023.81
   Secured Claim
E. Creditors Holding Unsecured
   Priority Claims
F. Creditors Holding Unsecured                   $68,859,047.80
   Nonpriority Claims
G. Executory Contracts and
   Unexpired Leases
H. Codebtors
I. Current Income of
   Individual Debtor(s)
J. Current Expenditures of
   Individual Debtor(s)
                              --------------    --------------
   Total                      $51,480,278.29    $88,519,071.61

Headquartered in Tuxedo, New York, Derivium Capital LLC markets
and administers loans.  The Company filed for chapter 11
protection on Sept. 1, 2005 (Bankr. S.D.N.Y. Case NO. 05-37491).
Steven Soulios, Esq., at Ruta & Soulios, LLP, represents the
Debtor in its restructuring efforts.  When the Debtor filed for
protection from its creditors, it listed $60,000,000 in assets
and $79,890,199 in debts.


DURATEK INC: Expects 2005 Revenues at $280 Million to $286 Million
------------------------------------------------------------------
Duratek, Inc. (NASDAQ:DRTK) expects 2005 revenues to be in the
range of $280 million to $286 million, compared to 2004 reported
revenues of $286 million.  The 2005 revenue outlook reflects a
lower than anticipated level of new Commercial work required to
offset projects completed during the year, a lengthening of the
sales cycle in the Company's Federal business, and no
international work awarded to date.  As a result, Duratek may
moderately reduce its accelerated debt payoff target of $15 - $17
million for the year.

Robert E. Prince, President and CEO said, "We have been working
very hard to strategically position the Company to be a winner in
our changing markets.  Our short-term growth rate is not where we
wanted it to be.  We believe the long term trends in the Federal
Department of Energy cleanup, commercial nuclear market, and
international markets will present favorable opportunities for
Duratek."

Duratek provides safe, secure radioactive materials disposition
and nuclear facility operations for commercial and government
customers.

                         *     *     *

As reported in the Troubled Company Reporter on Dec. 22, 2003,
Standard & Poor's Rating Services assigned its 'BB-/Stable/--'
corporate credit rating to Columbia, Maryland-based Duratek, Inc.

At the same time, Standard and Poor's assigned its 'BB-' rating to
Duratek's $145 million senior secured credit facilities.


DYCOM INDUSTRIES: S&P Rates $150 Million Sr. Sub. Notes at B+
-------------------------------------------------------------
Standard & Poor's Ratings Services assigned its 'BB' corporate
credit rating to engineering and construction firm Dycom
Industries Inc.  At the same time, the rating agency assigned its
'B+' subordinated debt rating to a $150 million senior
subordinated note offering due 2015, to be issued by Dycom
Investments Inc. (a wholly owned subsidiary of Dycom Industries).
The notes offering is to be issued under Rule 144a with
registration rights.  The outlook on Dycom Industries is stable.

The proceeds from the offering will be used to fund a $200 million
share repurchase program.

Palm Beach Gardens, Florida-based Dycom will have more than $200
million of pro forma debt following the note issuance.

"The initial ratings on Dycom Industries reflect the company's
aggressive financial risk profile, highlighted by the recently
announced share repurchase program," said Standard & Poor's credit
analyst James Siahaan.  "The ratings also reflect the company's
weak business risk profile as a provider of engineering and
construction services to the telecommunications and utilities
industries."

Dycom, with sales of nearly $1 billion, provides:

   * engineering;
   * construction;
   * installation; and
   * maintenance services primarily to:

     -- cable, and
     -- telecommunications companies.

In addition, it provides utility line locating services to those
industries, as well as to certain electric utilities.

The company competes in markets that are large, highly fragmented,
and cyclical.  Competition in this industry is based on price,
service breadth, and geographic reach.  Larger industry
participants, including Dycom, should benefit from the gradual
trends of outsourcing and vendor consolidation.  Presently, the
demand prospects are mixed.  There should be solid demand as
telecommunications companies deliver more fiber optic cable
directly to homes; however, at the same time, there has been less
demand for cable construction.

Dycom's strengths include:

   * its geographic reach (which is broader than that of
     most peers);

   * its fair risk management;

   * its limited fixed-capital intensiveness; and

   * its long-term relationships with stable customers.

These factors are counterbalanced by:

   * Dycom's high customer concentration;
   * its exposure to highly cyclical end markets; and
   * its only limited revenue visibility.

Nonetheless, key company profitability measures such as operating
margins and returns on permanent capital have been more
consistently favorable than those of peers such as Quanta Services
Inc. (BB-/Stable/--) and InfraSource Inc. (BB-/Stable/--).


DYCOM INVESTMENTS: Moody's Rates $150 Mil. Sr. Sub. Notes at Ba3
----------------------------------------------------------------
Moody's Investors Service assigned a Ba3 subordinated long-term
debt rating to Dycom Investments, Inc.'s $150 million, ten year
senior subordinated notes.  This is an initial rating for the
company.  The notes will be guaranteed by Dycom Industries, Inc.,
the parent company, as well as all downstream domestic
subsidiaries.  At the same time, a Ba2 corporate family rating
(formerly the senior implied rating) and SGL-1 Speculative Grade
Liquidity rating were assigned to Dycom.  The rating outlook is
stable.

The Ba2 corporate family rating reflects Dycom's leading position
as a provider of:

   * engineering,

   * construction,

   * maintenance, and

   * underground locating services for the utility and
     telecommunications industries.

Special contracting services for the telecommunication sector
represents almost 75% of its revenues.  The rating also
incorporates the company's relatively strong operating
performance, even through the telecommunication downturn, that has
produced good cash flow generation, well-established blue-chip
customer base, highly variable cost structure and favorable end-
market trends.

Moody's noted that although the company's operations are
geographically dispersed, covering 48 of the 50 states and multi-
year master service agreements and long term contracts cover
almost 89% of its revenues, Dycom has a concentration of customers
with the top three -- Verizon, BellSouth, and Comcast representing
over 53% of revenues and its multi-year contracts can be cancelled
by either party with 90 days notice.  The rating agency added that
any change in strategy slowing fiber-to-the-home or node growth
capital expenditures or loss of a contract from a major customer
could result in adverse financial results in any given year.

The Ba3 rating for the senior subordinated notes reflects the
effective subordination of the notes to priority of claims of
senior debt and trade creditors at the operating subsidiary level.
In addition, the subordinated notes rank junior to the bank
revolving credit facility at the Dycom level.  The $300 million
bank unsecured revolving credit (not rated by Moody's) is
guaranteed by Dycom Investments, as well as the downstream
domestic subsidiaries.  Moody's cautioned that the use of proceeds
would represent the bulk of the funding for a stock repurchase
program that could reach approximately $200 million, de-
capitalizing a very solid balance sheet, impacting financial
flexibility and adding meaningful leverage and interest expense.

The notes will be sold in a privately negotiated transaction
without registration under the Securities Act of 1933 under
circumstances reasonably designed to preclude a distribution
thereof in violation of the Act.  The issuance has been designed
to permit resale under Rule 144A.

The stable outlook anticipates the continuation of single digit
revenue growth in 2007 after a slight dip in 2006 due to one major
customer completing an upgrade initiative.  Improving operating
earnings and cash flow generation should reduce leverage over time
as long as major customers continue with their current growth
capital expenditure plans.

However, the stability of the outlook is sensitive to the
telecommunications and cable industry cycles, the company's
success at renewing its many master service agreements and the
continuation of positive end-market trends, including increased
outsourcing by the major providers and carriers and the consumers'
need for greater bandwidth.  Should these key factors show
weakness, the ratings outlook could face downward pressure.

More specifically on a credit metrics basis, debt-to-EBITDA in the
3.5x range, debt-to-capitalization in excess of 45% and free cash
flow-to-debt below 5% could warrant negative outlook/rating
implications.  Conversely, strong cash generation and accelerated
debt reduction such that debt-to-EBITDA falls below 1.5x, debt-to-
capitalization improves to the low 20% range and return on assets
approaches 10% could result in positive rating actions.

Ratings assigned with a stable outlook:

Dycom Industries, Inc.:

   * Ba2 corporate family rating (formerly the senior implied
     rating); and

   * GL-1 Speculative Grade Liquidity rating.

Dycom Investments, Inc.:

   * Ba3 for the senior subordinated notes.

The notes will be guaranteed by Dycom Industries, Inc. as well as
downstream domestic subsidiaries.

Through a self-tender offer set to expire October 11th, Dycom
plans to use the subordinated note proceeds in addition to
approximately $50 million of cash and/or drawdowns under the bank
revolver to purchase up to $200 million (just over 19%) of the
company's outstanding common stock.  Book equity, however will
decline almost 37 to roughly $347 million.

On a pro forma basis at July 31, 2005 using Moody's standard
adjustments, debt-to-EBITDA is slightly over 2x,
debt-to-capitalization is approximately 37% and free cash
flow-to-debt is roughly 7%.  The rating agency expects free cash
flow generation to be flat-to-down from 2005 levels as capital
expenditures rise over the next few years.

The SGL-1 Speculative Grade Liquidity rating reflects Dycom's
solid liquidity position, which is supported by $87 million of
cash on the balance sheet at July 31, 2005 and an unsecured $300
million five year bank revolving credit agreement, maturing in
December of 2009.  The facility has no outstanding borrowings to
date but does have $37 million of letters of credit under a $100
million sub limit.  Moody's noted that on a pro forma basis,
Dycom's cash on hand and unused availability under the bank
facility are more than sufficient to meet investment requirements
and nominal debt maturities over the next twelve months.

Dycom's bank facility was amended to allow for the share
repurchase program.  The revolver includes three financial
covenants, a debt-to-EBITDA ratio not to exceed 3.0x, an interest
coverage ratio not to fall below 2.75x and tangible net worth of
at least $70 million plus adjustments.  The company was well
within the financial covenants for the year ended July 31, 2005
prior to the amendment and on a pro forma basis have ample cushion
under the revised covenants.  There is Material Adverse Change
representation or warranty required for individual borrowings
under the facility as well as a one day notification to borrow.
The rating agency added that Dycom's assets are virtually
unencumbered and certain product lines or businesses are readily
saleable, factors which could provide additional flexibility in
liquidity planning if necessary.

Dycom Industries, Inc., a $1 billion company with EBITDA of $122
million, headquartered in Palm Beach Gardens, Florida, is a
leading provider of specialty contracting services, including
engineering, construction, maintenance, and underground locating
services for the utility and telecommunication industries.


ELITE TECHNICAL: CEO Fenton Out; Goudy & Heidebrecht on Helm
------------------------------------------------------------
Elite Technical Inc. (TSX VENTURE: ET) reported the termination of
CEO Peter Fenton's employment contract, effective immediately.

The Board of Directors have engaged John Goudy and Peter
Heidebrecht of Cornerstone Manufacturing under a short-term
contract to manage the Company's operations, while pursuing
strategic alternatives for the Company.

Mr. Goudy has over 12 years executive experience in various
manufacturing companies, including five years as Director of Sales
with Hi-Tech Assembly Systems from 1997 to 2002, while Mr.
Heidebrecht was Director of Engineering with Sanmina for four
years and prior thereto spent 14 years as Manufacturing
Engineering Manager with Nortel.

The Company has also fulfilled its obligations to date under the
Notice of Intention to make a Proposal under the Bankruptcy and
Insolvency Act.  With the bank's agreement, Elite has until
October 12, 2005, to present a Proposal to Creditors or file for
an extension, while continuing with production and operations.

In addition, Elite reported that following the termination of the
prospectus offering, the Share Purchase Agreement signed with
Pinnacle Capital for the acquisition of Hi-Tech Assembly Systems
has expired.

Elite Technical Inc. -- http://www.etechi.com/-- is a Calgary-
based manufacturer of high-quality, high-reliability cable
assemblies and connection solutions for use in a broad range of
commercial and industrial products, and electrical systems.  Elite
is listed for trading on the TSX Venture Exchange under the symbol
"ET." and has 10,999,650 common shares outstanding.


ENER1 INC: Eisner LLP Replaces Kaufman Rossin as Auditors
---------------------------------------------------------
Ener1, Inc., has retained Eisner LLP as its independent registered
public accounting firm, effective immediately.  Eisner LLP
replaces Kaufman, Rossin & Co. who resigned on August 16, 2005.

The decision to appoint the new independent registered public
accounting firm was made by the company's Audit Committee of the
Board of Directors.

The reports of Kaufman on Ener1's consolidated financial
statements for the fiscal years that ended December 31, 2004, and
2003 did not contain an adverse opinion or disclaimer of opinion
and were not qualified or modified as to uncertainty, audit scope
or accounting principles.

A. Ernest Toth, the Company's Chief Financial Officer, informs the
Securities and Exchange Commission that during the fiscal years
that ended December 31, 2004, and 2003 and the subsequent interim
period from January 1, 2005, through August 16, 2005,

   (1) there were no disagreements between Ener1 and Kaufman on
       any matter of accounting principles or practices, financial
       statement disclosure or auditing scope or procedure, which
       disagreements, if not resolved to the satisfaction of
       Kaufman, would have caused Kaufman to make reference to the
       subject matter of the disagreement(s) in connection with
       its report on the consolidated financial statements for
       such periods, and

   (2) there were no "reportable events" as such term is defined
       in Item 304(a)(1)(v) of Regulation S-K.

Ener1, Inc. (EBB: ENEI) -- http://www.ener1.com/-- is an energy
technology company.  The company's interests include:

   * 80.5% of EnerDel -- http://www.enerdel.com/-- a lithium
     battery company in which Delphi Corp. owns 19.5%;

   * 49% of Enerstruct, a Japanese lithium battery technology
     company in which Ener1's strategic investor ITOCHU owns 51%;
     wholly owned subsidiary EnerFuel, a fuel cell testing and
     component company -- http://www.enerfuel.com/; and

   * wholly owned subsidiary NanoEner -- http://www.nanoener.com/
     --  which develops nanotechnology-based materials and
     manufacturing processes for batteries and other applications.

At June 30, 2005, the Company's balance sheet shows $17,690,000 in
total assets and a $13,733,000 stockholders deficit.


ENRON CORP: Court Okays Amendments to Plan Schedule S
-----------------------------------------------------
The U.S. Bankruptcy Court for the Southern District of New York
approved certain amendments to Enron Corporation and its debtor-
affiliates' Plan Schedule S.

The Reorganized Debtors circulated to their creditors and filed
with the Court an amended Schedule S to their Plan Supplement
filed in March 2004.

The Schedule lists the instruments and types of claims that are
entitled to the benefits of subordination according to the
provisions of the Enron Subordinated Debentures, the Enron TOPrS
Debentures or the Loan Agreement executed in connection with:

      * the Enron Capital Resources, L.P. 9% Cumulative
        Preferred Securities, Series A; or

      * the Enron Capital LLC 8% Cumulative Preferred Securities.

The Reorganized Debtors informed the Court that distributions with
respect to the Schedule will begin no sooner than October 2005
and may not begin until April 2006 or thereafter.  They explained
that the ability to distribute to senior indebtedness is
contingent on a number of factors, including, but not limited to:

    (i) entry of a final order by the Bankruptcy Court approving
        the amended Schedule S; and

   (ii) liquidation of senior claims.

The Reorganized Debtors advise affected creditors to consult with
their counsel as to their entitlement to the benefits of the
subordination provisions.

A full-text copy of the amended Schedule S is available at no
extra charge at http://ResearchArchives.com/t/s?1cc

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

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


ENRON CORP: Court Okays $1.4 Million Settlement with UBS AG
-----------------------------------------------------------
The U.S. Bankruptcy Court for the Southern District of New York
approved a compromise and settlement agreement between Enron
Corporation and its debtor-affiliates and UBS AG.

On Oct. 9, 2002, UBS filed an adversary proceeding against ENA
seeking a constructive trust in favor of UBS in the amount of
$7,083,000.  UBS claims that it had mistakenly transferred a
duplicate payment of $7,083,000 to ENA.

ENA denied that UBS was entitled to a constructive trust.

UBS filed Claim No. 15333 against ENA for $10,906,038 for amounts
owed under the Contract and on account of the Duplicate Payment.

The Reorganized Debtors objected to the Claim on grounds that it
was overstated.

Pursuant to the Settlement between the parties:

    (1) ENA will pay UBS $1,350,000;

   (ii) Claim No. 15333 will be allowed as a Class 5
        general unsecured claim against ENA for $7,750,000;

  (iii) The Adversary Proceeding will be dismissed with prejudice;
        and

   (iv) The parties will exchange mutual releases of claims.

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

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


ENRON CORP: Wants Project Teresa Settlement Agreement Approved
--------------------------------------------------------------
In March 1997, Enron Corp., along with numerous parties, formed
Project Teresa to raise third party capital and to create a
leasing company of leased assets.  The Project aims to achieve
certain financial accounting benefits arising from basis
increases in stock and partnership interests.

Under Project Teresa, the parties entered into various
transactions, including Enron contributing certain assets to
Organizational Partners, Inc., which, in turn, contributed the
assets to Enron Leasing Partners, L.P.  The contributed assets
included, among others, the lease for Enron's headquarters
building located at 1400 Smith Street in Houston, Texas.

Seneca Delaware, Inc., formerly known as EN-BT Delaware, Inc.,
and Potomac Capital Investment Corporation, as shareholders and
lenders in OPI, and EN-BT, as a limited partner in ELP, infused
$30 million in aggregate equity and debt investments.

                           Brazos Loan

In April 1997, Enron monetized the value of its Building in
Houston, Texas, pursuant to a synthetic lease financing structure
in which Brazos Office Holdings, L.P., provided cash to Enron
with financing received from a syndicate of banks, with JP Morgan
Chase as Agent.

Contemporaneously with the Brazos Loan, Brazos and OPI entered
into a lease agreement, which was assigned to the Brazos Lenders,
and Enron guaranteed OPI's obligations under the Prime Lease for
the benefit of the Brazos Lenders.

On Oct. 11, 2002, the Agent filed two proofs of claim in
connection with, among other things, the Parent Guaranty.

OPI subsequently assigned its rights under the Prime Lease to
ELP, which subleased the headquarters building to Enron.  Enron
subsequently assigned its rights and obligations under the
sublease to Enron Property & Services Corp.

                        Brazos Settlement

Susheel Kirpalani, Esq., at Milbank, Tweed, Hadley & McCloy LLP,
in New York, relates that the Enron Parties have negotiated a
settlement with JPMC and certain of the Brazos Lenders, other
than EN-BT and Deutsche Bank AG, in connection with the alleged
liabilities owing to Brazos.

However, the DB Parties have informed the Enron Parties that they
oppose the Brazos Settlement.

The Reorganized Debtors anticipate that the Brazos Settlement
will be presented to the Court in the future.

The Brazos Transactions are not included within the Teresa
Transactions, Mr. Kirpalani notes.

                   Ownership in ELP, EPMC and OPI

The Teresa Transactions resulted to ownerships and claims of
various entities, including ELP, OPI, Enron Pipeline Holding
Company and Enron Property Management Corp.:

   (A) ELP:     OPI owns the majority limited partnership interest
                in ELP.  EN-BT owns a minority limited partnership
                interest in ELP.  EPMC owns the general
                partnership interest in ELP.  Enron Property &
                Services Corp., a wholly owned subsidiary of
                Enron, provides management services to ELP.

                ELP holds a scheduled, prepetition claim against
                Enron and EPSC for $472,369,095 and $7,933,829.
                ELP also holds an administrative rent claim
                against Enron for $8,300,000.

   (B) OPI:     Potomac owns 100% of the Series A Preferred Shares
                of OPI.  EN-BT owns 100% of the Series B Preferred
                Shares of OPI.  Enron owns 100% of the Common
                Shares of OPI.

   (C) EPHC:    ELP holds an 80.2% preferred stock interest in
                EPHC, which holds a scheduled prepetition claim
                against Enron for $131,992,165, which yields a net
                interest of ELP in EPHC of $99,593,207.

   (D) EPMC:    Enron indirectly owns 100% of the Common Shares of
                EPMC.  EPMC holds a scheduled prepetition claim
                against Enron for $6,645,738.

                 Deutsche Bank and EN-BT Claims

On Sept. 26, 2003, Enron and several of its affiliated Debtors
commenced an adversary proceeding against, among other persons,
Deutsche Bank AG and EN-BT to assert causes of action in
connection with the Teresa Transactions.

On the other hand, the DB Parties filed Claim Nos. 12800 and
12801 in Enron's Chapter 11 case.  They also asserted claims,
demands and causes of action against ELP, OPI, EPMC and EPSC.

                    Project Teresa Settlement

The Enron Parties and the DB Parties have engaged in negotiations
to resolve their differences in connection with Project Teresa
and the Brazos Settlement.  They were able to reach a settlement
agreement.

The salient terms of the Teresa Settlement Agreement are:

    (a) The DB Parties will receive not less than $21,428,880 from
        OPI:

         (i) EN-BT, as holder of the Series B Preferred
             Shares of OPI, will receive $16,428,880 from
             OPI:

               * $12,397,959 of which represents a return of
                 its initial equity investment in OPI; and

               * $4,030,921 of which represents unpaid dividends
                 and accrued interest assuming a Closing Date of
                 September 30, 2005; and

        (ii) EN-BT, as holder of the minority limited partnership
             interest in ELP, will receive $5,000,000 from OPI in
             settlement of its claims against ELP;

    (b) In the event the closing date occurs after September 30,
        2005, the settlement amount will be increased by pro
        rating the aggregate amount of unpaid dividends and
        accrued interest as of the Closing Date based on these
        amounts:

          -- $4,128,126 as of October 31, 2005,
          -- $4,225,330 as of November 30, 2005, and
          -- $4,322,534 as of December 31, 2005;

    (c) In exchange for the payment:

          -- the DB Parties consent to the Brazos Settlement;

          -- the Enron Parties will redeem the DB Parties'
             preferred equity and partnership interests in OPI
             and ELP; and

          -- the Adversary Proceeding and the Teresa Claims will
             be deemed irrevocably withdrawn or waived, with
             prejudice; and

    (d) The parties will exchange limited mutual releases.

Pursuant to Rule 9019 of the Federal Rules of Bankruptcy
Procedure, the Reorganized Debtors ask the U.S. Bankruptcy Court
for the Southern District of New York to approve the Teresa
Settlement Agreement.

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

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


ENTERGY NEW ORLEANS: Files Chapter 11 Petition Due to Katrina
-------------------------------------------------------------
Entergy New Orleans, Inc., a New Orleans subsidiary of Entergy
Corporation (NYSE: ETR), voluntarily filed for reorganization
under Chapter 11 of the U.S. Bankruptcy Code.  The Debtor filed
for bankruptcy protection in order to protect its customers and
ensure continued progress in restoring power and gas service to
New Orleans after Hurricane Katrina.

                      DIP Financing

The Debtor asks the Court for permission to access up to
$200 million in debtor-in-possession financing committed by
Entergy Corp. to address the Debtor's current liquidity crisis.
The petition also requests that up to $150 million of these loans
be approved on an interim basis.  These funds will enable Entergy
New Orleans to meet its near-term obligations, including employee
wages and benefits, payments under power purchase and gas supply
agreements, and its current efforts to repair and restore the
facilities needed to serve its electric and gas customers.

Entergy Corporation trusts that the bankruptcy court will act
swiftly to approve its debtor-in-possession financing for the
Debtor.  Entergy New Orleans, which provides electric and natural
gas service to customers within the city of New Orleans, is the
smallest of Entergy's five utility companies and represented about
7 percent of the consolidated revenues and 3 percent of its
consolidated earnings in 2004.  Neither Entergy Corporation nor
any of Entergy's other utility and non-utility subsidiaries were
included in the bankruptcy filing.

"We took this action after careful review of the various options
available to preserve Entergy New Orleans' business over the near-
and long-term" said Dan Packer, Entergy New Orleans' chairman and
chief executive officer.  "Due to our parent company's financial
support, we can focus on the city's reconstruction and rebirth, as
those restoration efforts continue today."

This filing also is intended to address the very legitimate
concern expressed recently in a letter by U.S. Senators Mary
Landrieu and David Vitter from Louisiana to President Bush that
the potential bankruptcy of Entergy New Orleans would stall or
cease restoration efforts in the City as a result of creditor
disputes that could arise in such a filing.  In making the filing
for debtor-in-possession financing, it is Entergy's hope and
desire that the Debtor will be able to continue its restoration
efforts for the immediate future.  The Court has set this petition
and motion for hearing today, Sept. 26.

As the City Council of New Orleans stated in a letter of support
to Entergy Chief Executive Officer J. Wayne Leonard this week, any
long-term solution, that provides for a financially viable utility
at Entergy New Orleans and protects customers from the massive
restoration costs they can ill afford to pay, must involve a
substantial federal financial commitment.

In a related action, a bill was introduced by Senators Landrieu
and Vitter in the U.S. Senate on Sept. 22 that could provide
$250 billion of financial aid to Louisiana, of which $2.5 billion
was earmarked to cover restoration costs of in-state utilities,
including Entergy's Louisiana subsidiaries.

Federal resources, in addition to reimbursement of certain costs
covered by insurance, are critical to restoring the system and
restoring Entergy New Orleans' financial health.  Entergy is
working with public officials at the federal, state and local
levels to try to secure vital government assistance.

                   Pre-Bankruptcy Actions

Entergy had taken steps in advance of this bankruptcy filing by
Entergy New Orleans to mitigate any effects of the filing on the
parent and its financially stronger subsidiaries.  Prior to the
Entergy New Orleans' bankruptcy filing, Entergy obtained
amendments to the $2 billion bank revolving credit facility and
other bank facilities to eliminate the bankruptcy of Entergy New
Orleans as an Event of Default under the terms of those bank
agreements.  Therefore, the Debtor's bankruptcy filing will not
trigger a default under these bank facilities or other financing
obligations of Entergy and subsidiaries that are not party to this
bankruptcy filing.

Entergy Corporation -- http://www.entergy.com/-- is an integrated
energy company engaged primarily in electric power production and
retail distribution operations.  Entergy owns and operates power
plants with approximately 30,000 megawatts of electric generating
capacity, and it is the second-largest nuclear generator in the
United States.  Entergy delivers electricity to 2.7 million
utility customers in Arkansas, Louisiana, Mississippi, and Texas.
Entergy has annual revenues of over $10 billion and approximately
14,000 employees.


ENTERGY NEW ORLEANS: Case Summary & 20 Largest Unsecured Creditors
------------------------------------------------------------------
Debtor: Entergy New Orleans Inc.
        c/o R. Patrick Vance, Esq.
        Jones Walker
        8555 United Plaza Boulevard, 4th Floor
        Baton Rouge, Louisiana 70809-7000

Bankruptcy Case No.: 05-17697

Type of Business: The Debtor sells both electric power and gas
                  to retail customers in the City of New Orleans,
                  except for Algiers.  Entergy New Orleans is a
                  wholly owned subsidiary of Entergy Corporation.
                  See http://www.entergy.com/

Chapter 11 Petition Date: September 23, 2005

Court: Eastern District of Louisiana (New Orleans)

Judge: Jerry A. Brown

Debtor's Counsel: Elizabeth J. Futrell, Esq.
                  R. Partick Vance, Esq.
                  Jones, Walker, Waechter, Poitevent,
                  CarrSre & DenSgre, L.L.P.
                  201 Street, Charles Avenue, 49th Floor
                  New Orleans, Louisiana 70170-5100
                  Tel: (504) 582-8000
                  Fax: (504) 589-8194

Total Assets: $703,197,000

Total Debts:  $610,421,000

Debtor's 20 Largest Unsecured Creditors:

   Entity                     Nature of Claim       Claim Amount
   ------                     ---------------       ------------
Atmos Energy Marketing LLC    Gas purchases          $13,219,466
11251 Northwest Freeway,#400
Houston, TX 77092

Bridgeline Gas Distribution   Gas purchase            $9,768,204
Co.
333 Clay Street, #1200
Houston, TX 77002

Western Gas Resources Inc.    Gas purchases           $4,146,326
1099 18th Street, #1200
Denver, CO 80202

Magnus Energy Marketing Ltd.  Gas purchases           $2,226,291
2805 North Dallas Tollway
#640
Plano, TX 75093

Coral Energy Resources LP     Gas purchases           $1,856,825
909 Fannin Street, #700
Houston, TX 77010

Enbridge Marketing US Inc.    Gas purchases             $871,735
1100 Louisiana, #3300
Houston, TX 77002

Apache Corp.                  Gas purchases             $437,394
2000 Post Oak Boulevard,#100
Houston, TX 77056-4400

Air 2 LLC                     Utility services          $234,638
                              contractor

Bridgeline Gas Marketing LLC  Gas purchases             $214,153

Chaparral Energy, LLC         Gas purchases             $128,823

ER Solutions, Inc.                                       $69,588

CJ Calamania Construction     Utility services           $43,287
Co., Inc.                     provider

Pike Electrical Contractor    Utility contract           $29,823
Inc.                          services

William C. Broadhurst         Consultant                 $24,500

Mail Box Inc.                                            $22,315

AT&T                          Communication              $18,203
                              services

Strategic Business                                       $16,775
Initiatives Inc.

David J. Domangue Equip.      Electrical supplies        $15,278

Priority Wire & Cable         Electrical supplies        $14,638

Policy & Planning             Consultant                  $8,700
Partners LLC


ENTERGY NEW ORLEANS: Fitch Assigns D Issuer Default Rating
----------------------------------------------------------
Fitch Ratings maintains the 'CCC' first mortgage bond rating of
Entergy New Orleans, Inc., and assigns a 'D' issuer default rating
in accordance with the recovery rating methodology published
July 26, 2005, following ENOI's Chapter 11 bankruptcy filing on
Sept. 23, 2005.

Based on Fitch's initial recovery analysis, the 'CCC' rating
reflects good recovery prospects for first mortgage bondholders.
Fitch will update the ratings for ENOI as more information
regarding creditor recovery prospects becomes available during the
course of the bankruptcy.  Fitch notes that ENOI's parent, Entergy
Corp., has obtained waivers for the cross default provision in its
primary $2 billion credit facility.


ENTERGY NEW ORLEANS: S&P Downgrades Corporate Credit Rating to D
----------------------------------------------------------------
Standard & Poor's Ratings Services lowered its corporate credit
rating on electric utility Entergy New Orleans Inc. to 'D' from
'CCC+' reflecting the company's voluntary petition for bankruptcy
protection filed on September 23, 2005.

Standard & Poor's also lowered its rating on Entergy New Orleans'
first mortgage bonds to 'CC' from 'CCC+'.  The rating remains on
CreditWatch with negative implications pending further clarity
regarding the likelihood of nonpayment on these obligations.  In
addition, the recovery prospects for first mortgage bondholders
are still under review pending the valuation of the remaining
utility plant collateral and insurance proceeds.

The ratings on the company's parent, New Orleans, Louisiana-based
Entergy Corp. (BBB/Watch Neg/--), and all other affiliates remain
on CreditWatch with negative implications.  As of June 30, 2005,
Entergy New Orleans had $259 million of debt outstanding.

"Entergy New Orleans' bankruptcy filing is in response to the
unit's near-term liquidity needs and restoration costs from
Hurricane Katrina, currently estimated at between $325 million to
$475 million," said Standard & Poor's credit analyst John Kennedy.

Entergy, the parent company, eliminated all cross defaults
associated with its bank credit facility before Entergy New
Orleans filed for bankruptcy.  Entergy may provide $200 million to
Entergy New Orleans as debtor-in-possession financing, on
bankruptcy court approval, for the unit's short-term needs.

"We continue to believe that parent Entergy and all other units
will be excluded from Entergy New Orleans' bankruptcy filing based
on the assessment that the parent has the means and motivation to
effectively contain the obligations of Entergy New Orleans at the
subsidiary level," said Mr. Kennedy.


ENXNET INC: Sprouse & Anderson Declines Re-Election as Auditor
--------------------------------------------------------------
On Sept. 12, 2005, Enxnet, Inc., received written communication
from Sprouse & Anderson, LLP, stating that Sprouse & Anderson's
Audit Retention Committee had elected to decline to stand for
re-election for the Company's audit for the year ended March 31,
2006.

On June 9, 2005, Sprouse & Anderson completed its audit of the
company's financial statements for the fiscal year ending
March 31, 2005.  Sprouse & Anderson expressed substantial doubt
about the Company's ability to continue as a going concern,
pointing to the Company's working capital deficit and losses since
inception.

Ryan Corley, the Company's President and Principal Executive
Officer, makes it clear the Company did not have any disagreements
with Sprouse & Anderson on any matter of accounting principles or
practices, financial statement disclosure, or auditing scope or
procedure.

The Company has not yet identified an independent accounting firm
to succeed Sprouse & Anderson.

The Company offers video compression services for distribution,
downloading, and streaming of video and audio content for use on
the Internet, advertising applications, television and cable
broadcasting companies, and standard content media such as DVDs.


EPICUS COMMS: Auditors Express Going Concern Doubt in Form 10-K
---------------------------------------------------------------
S.W. Hatfield, CPA, expressed substantial doubt about Epicus
Communications Group, Inc.'s ability to continue as a going
concern after it audited the Company's financial statements for
the year ended May 31, 2005.  The auditing firm points to the
Company's operating losses and negative cash flow from operations.

The Company also reported that it has incurred cumulative
operating losses for the previous four-year period and has used
cash in operating activities for the cumulative four-year period
from May 31, 2002 through May 31, 2005 of approximately
$4,200,000.  The Company says that although it has a positive
working capital of approximately $600,000 as of May 31, 2005, it
continues to experience cash flow difficulties in matching its
contractual payment obligations, principally to BellSouth Corp.
and Global Crossing, to its revenue billing cycles.

As of May 31, 2005, Epicus Group had approximately $164,000 in
cash in its operating account compared with $922,000 in May 31,
2004.  To assist it in its cash flow requirements management may
determine, depending upon the prevailing stock price of Company
shares, to seek subscriptions from the sale of securities to
private investors, although there can be no assurance that the
Company will be successful in securing any investment from private
investors at terms and conditions satisfactory to it, if at all.

If the Company is unable to obtain new capital, the Company will
be unable to carry out its strategy of growth through acquisitions
and the long-term ability of the Company to continue its
operations may be in doubt.

                       Chapter 11 Update

On Oct. 25, 2004, Epicus Communications Group, Inc., and its
subsidiary, Epicus, Inc., filed voluntary petitions in the United
States Bankruptcy Court for the Southern District of Florida
seeking reorganization relief under the provisions of Chapter 11
of Title 11 of the United States Code

For the year ended May 31, 2005, as a result of management's
actions related to the chapter 11 filing, total revenues declined
by approximately $6,400,000 from Fiscal 2004 revenues of
approximately $25,191,000 to approximately $18,776,000 for Fiscal
2005.  This decline was directly related to:

    * an evaluation of the various states where the Company was
      providing service,

    * the direct cost of service to that State, and

    * the number of customers in a particular State and various
      problems in dealing with telecommunications backbone
      providers outside BellSouth Corp. and Global Crossing, the
      Company's two primary backbone providers.

Management believes that it has identified the service areas which
afford the best potential profitability and customer quality.

                    Convertible Notes in Default

As a result of the bankruptcy filing, the Company is in default
under the terms of the Callable Secured Convertible Notes it
executed on May 28, 2004, July 22, 2004 and September 27, 2004 in
connection with the private placement of an aggregate of
$3,300,000 in 8% secured convertible notes which begin to mature
on May 28, 2006.  As a result of such default, the principal
amount, plus accrued and unpaid interest, including any liquidated
damages, if any, on the Notes may be determined to be due and
payable.  As a result of the bankruptcy filing, the ability of
creditors to seek remedies to enforce their rights under all such
agreements are stayed and creditor rights of enforcement are
subject to the applicable provisions of the Bankruptcy Code.
Additionally, despite the uncertainty of the ultimate settlement
or outcome of the Bankruptcy action, the Debtors have continued
the accrual of the applicable contractual interest charges on all
outstanding notes or debenture agreements for all periods through
May 31, 2005.

Headquartered in West Palm Beach, Florida, Epicus Group is a
holding company with a primary goal of investing in its current
telecommunications assets.  Epicus, Inc., it's a wholly-owned
subsidiary is an integrated communications provider with voice and
data service in the continuous 48 states, international long
distance in 240 countries with local exchange services in 7
southeastern states.  The Debtors filed for chapter 11 protection
on Oct. 25, 2004 (Bankr. S.D. Fla Case Nos. 04-34915 and 04-
34916).  Alvin S Goldstein, Esq., represents the Debtors in their
restructuring efforts.

At May 31, 2005, Epicus Communications Group Inc.'s balance sheet
showed a $16,271,072 stockholders' deficit, compared to a
$9,284,572 deficit at May 31, 2004.


FAIRFAX FINANCIAL: Fitch Affirms Senior Debt Ratings at B+
----------------------------------------------------------
Fitch Ratings has affirmed the ratings of Fairfax Financial
Holdings, Ltd., and removed the ratings from Rating Watch
Negative.  The Rating Outlook is Stable.  The rating action
reflects perceived improvements in Fairfax's overall financial
profile, and Fitch's belief that the company has likely 'turned
the corner' in its recovery following a sharp decline in credit
fundamentals beginning in the late 1990s.

In addition, Fitch has affirmed and/or upgraded the ratings of
Fairfax's wholly and partially owned subsidiaries.  Upgraded
ratings include the Insurer Financial Strength ratings of members
of the Northbridge Group, and the debt ratings of Crum & Forster
Holdings and TIG Holdings Inc.  Fitch also assigned debt ratings
to Odyssey Re Holdings Corp.  The Rating Outlook for all
affiliated ratings is Stable.  A full list of all ratings can be
found below. Approximately $2.6 billion of debt is affected by
these actions.

The rating actions follow Fitch's completion of its regular
ratings review cycle for Fairfax.  Fitch recognizes possible
losses facing the industry in the near term due to Hurricane Rita.
Fitch will react to losses from Rita for the industry and Fairfax
as necessary, after the event occurs.

According to Fitch, these key issues drive Fairfax's ratings
profile:

a) Cash Flow and Liquidity

Operational cash flows and holding company liquidity have
improved, but future cash needs remain hard to predict.  Cash
requirements at Fairfax have been significantly higher than for
most insurance holding companies due to the need to fund troubled
runoff businesses.  Runoff businesses face the risk of reserve
shortfalls that have required capital or finite reinsurance
premium funding, as well as timing issues in paying claims and
collecting on large reinsurance balances.

Over the past several years Fairfax has needed to fill significant
cash flow shortages via capital markets and other activities.
Signs of recent improvement include Fairfax's ability to unlock
over $600 million of funds previously held in trust at the request
of the California Insurance Department at runoff company TIG, the
ability to upstream dividends from Crum & Forster beginning in
2004, a restructuring of debt to reduce maturities over the next
five years, and the need to no longer fund premiums on existing
finite reinsurance contracts.  Fitch also believes the risk of
further major reserving shortfalls is lower than in the recent
past.

b) Financial Flexibility

Despite its non-investment-grade ratings and weak earnings,
Fairfax has demonstrated superior financial flexibility over the
past several years, especially for a company at its ratings level.

Financial flexibility has been demonstrated by successful capital
market activities, including equity raising at the Fairfax level
and debt issuance at the subsidiary level, the successful partial
IPOs of subsidiaries Odyssey Re and Northbridge, the sale of
shares in strategic investments such as Zenith Insurance, and
tapping subsidiaries for cash via 'arm's length' transactions.  An
example of the latter includes Odyssey Re funding a $211 million
Lloyds deposit on behalf of Fairfax for a fee in 2004.

While the partial IPOs have reduced future consolidated earnings
and upstream dividend capacity, they proved highly opportunistic
in allowing Fairfax to work through its near-term cash flow
issues.  Fitch believes Fairfax will likely be able to find
additional sources of financial flexibility, if needed, and views
financial flexibility as a key source of strength for the company.

c) Earnings

Fairfax's earnings are bi-polar in nature, and thus hard to
predict, though Fitch believes consolidated earnings trends will
likely continue to improve. However, despite improvements,
operating earnings remain very weak, and Fitch believes it will
take Fairfax several more years to show reasonable consolidated
operating margins.

On one hand, Fairfax produces strong earnings from its ongoing
operations, primarily Odyssey Re, Crum & Forster, and Northbridge,
with combined ratios below 100% the last couple years.  However,
strong ongoing earnings have been overwhelmed by runoff losses,
together with the reversal of earnings from minority interests in
Odyssey Re and Northbridge.

In addition, positive net earnings are heavily reliant on realized
investment gains, as investment yields have been quite modest and
have trended downward.  Fully consolidated operating earnings,
before realized capital gains, were at a large loss in each year
in 2000-2003, with small operating profits produced in 2004 and
first-half 2005.  Including realized gains, average earnings are
stronger, but have shown period-to-period volatility.

d) Financial Leverage

While the risk embedded in Fairfax's capital structure improved
greatly in 2004 due to a debt restructuring that greatly pushed
out maturities, financial leverage remains very high.  Debt-to-
earnings before interest and taxes, even including realized gains,
has averaged over 5 times (x) since 2002, and remained very high
at 4.8x in first-half 2005.  Such high leverage ratios are
consistent with the current 'B+' level senior debt rating assigned
to Fairfax.

While debt-to-capital ratios, which stand at approximately 40%,
fall on the cusp between low investment grade and high non-
investment-grade standards, Fitch believes earnings-based leverage
ratios provide a much truer picture of the risks related to
Fairfax's capital structure and debt servicing abilities, and are
thus weighed heavily in our analysis.  Fitch believes management's
focus on debt/capital ratios instead of ratios such as debt/EBIT
may be a key reason the company has not de-leveraged its balance
sheet despite its recent challenges.  Fitch believes Fairfax's
financial profile would benefit greatly from a material de-
leveraging until earnings and cash flows are stronger.

e) Turning the Corner

Fitch believes the most critical question driving Fairfax's
ratings, and Rating Outlook, is if the company has indeed 'turned
the corner.'  On balance, Fitch's comfort has increased that
Fairfax will continue to show signs of improvement.

In addition to favorable developments previously noted, positive
signs include management's stated commitment to maintain
underwriting discipline as markets soften, Crum & Forster
reporting a combined ratio below 100% for the first time in the
recent past during first-half 2005, Fairfax's ability to free up
cash in the second quarter of 2005 from the commutation of a
finite reinsurance contract with Chubb, reductions in still high
levels of reinsurance recoverables, and reduced levels of adverse
reserve development.  Lingering concerns include the risk of
reserve development or reinsurer bad debts, uncertainty as to
ultimate loss levels from Hurricane Katrina, and the uncertain
nature of runoff cash flow requirements.

The upgrade for Northbridge's IFS ratings reflects the group's
very strong underwriting performance over the past several years
which is partially offset by above-average operating leverage.
The upgrade of Crum & Forster's debt ratings reflects the
subsidiaries' resumption of upstream dividends in 2004.  The
upgrade of TIG's ratings reflects alignment of TIG's and Fairfax's
debt ratings recognizing significant reductions in TIG's
standalone leverage.

Though our near-term Rating Outlook is Stable, in the medium term
Fitch would expect Fairfax to experience positive momentum in its
ratings should debt/EBIT move closer to 3x, earnings show less
reliance on realized gains and become viewed as sustainable, and
Fairfax demonstrate an ability to continue to maintain material
holding company cash (management target is $500 million) -
especially without reliance on financing activities.

Negative ratings momentum could return should Fairfax experience
major adverse reserve developments, material new finite
reinsurance usage, a reversal of positive trends in underwriting
performance within its ongoing operations, a widening of cash flow
shortfalls, or signs that financial flexibility is waning.

Fitch affirms Fairfax Financial Holdings Ltd.'s long-term issuer
and senior debt ratings at 'B+' and removes the ratings from
Rating Watch Negative.  The Rating Outlook is Stable.

     -- $61 million unsecured due 3/15/06;
     -- $62 million unsecured due 4/15/08;
     -- $467 million unsecured due 4/15/12;
     -- $100 million unsecured due 10/1/15;
     -- $190 million unsecured due 4/15/18;
     -- $92 million unsecured due 7/15/37;
     -- $96 million convertible due 7/15/23.

Fitch affirms Fairfax, Inc.'s long-term issuer and senior debt
rating at 'B+' and removes the ratings from Rating Watch Negative.
The Rating Outlook is Stable.

     -- $101 million exchangeable due 11/19/09.

Fitch assigns Odyssey Re Holdings Corp. long-term issuer and
senior debt ratings at 'BB+'.  The Rating Outlook is Stable.

     -- $40 million unsecured due 11/30/06;
     -- $92 million convertible due 6/22/22;
     -- $225 million unsecured due 11/1/13;
     -- $125 million unsecured due 2015.

Fitch upgrades Crum & Forster Holdings' long-term issuer and
senior debt ratings to 'B+' from 'B' and removes the ratings from
Rating Watch Negative.  The Rating Outlook is Stable.

     -- $300 million unsecured due 6/15/13.

Fitch upgrades TIG Holdings Inc.'s long-term issuer rating to 'B+'
from 'B'.  Fitch upgrades the following trust preferred stock
rating for TIG Capital Trust I to 'B-' from 'CCC+'.  All noted
ratings were removed from Rating Watch Negative.  The Rating
Outlook is Stable.

     -- $52 million due 2027.

Fitch affirms and removes from Rating Watch Negative these IFS
ratings at 'BBB+' for members of the Odyssey Re Group.  The Rating
Outlook is Stable.

     -- Odyssey American Reinsurance Corp.
     -- Clearwater Insurance Co.

Fitch affirms and removes from Rating Watch Negative these IFS
ratings at 'BBB-' for members of the Crum & Forster Group.  The
Rating Outlook is Stable.

     -- Crum & Forster Insurance Co.
     -- Crum & Forster Underwriters of Ohio
     -- Crum & Forster Indemnity Co.
     -- Industrial County Mutual Insurance Co.
     -- The North River Insurance Co.
     -- United States Fire Insurance Co.
     -- Zenith Insurance Co. (Canada)

Fitch upgrades to 'BBB' from 'BBB-' and removes from Rating Watch
Negative these IFS ratings for members of the Northbridge Group.
The Rating Outlook is Stable.

     -- Commonwealth Insurance Co.
     -- Commonwealth Insurance Co. of America
     -- Federated Insurance Co. of Canada
     -- Lombard General Insurance Co. of Canada
     -- Lombard Insurance Co.
     -- Markel Insurance Co. of Canada

Fitch affirms and removes from Rating Watch Negative these IFS
ratings at 'BB+' for members of the TIG Insurance Group.  The
Rating Outlook is Stable.

     -- Fairmont Insurance Co.
     -- TIG American Specialty Ins. Co.
     -- TIG Indemnity Co.
     -- TIG Insurance Co.
     -- TIG Insurance Co. of Colorado
     -- TIG Insurance Co. of New York
     -- TIG Insurance Co. of Texas
     -- TIG Insurance Corporation of America
     -- TIG Lloyds Insurance Co.
     -- TIG Specialty Insurance Co.


GOODYEAR TIRE: Expects to Spend $150M to $250M on Turnaround Plan
-----------------------------------------------------------------
Robert J. Keegan, chairman and chief executive officer of The
Goodyear Tire & Rubber Company, discloses plans to continue the
tiremaker's business turnaround.

The company plans include accelerating the introduction of
consumer-driven innovative new tires, reducing its cost structure,
closing high-cost factories and generating capital to support
further investment in its core tire businesses worldwide.

"We successfully achieved many of the goals we set three years ago
and look to further improve our performance as we move to the next
stage of our turnaround," said Mr. Keegan.

Over the next three years, Goodyear anticipates incurring cash
restructuring charges of approximately $150-250 million to reduce
its high-cost manufacturing capacity by between 8 percent and
12 percent resulting in anticipated annual savings of between
$100 million and $150 million.  The company will not identify how
many plants it will close or the locations while it continues its
evaluation, but indicated that reducing high-cost capacity will be
a key component of the continued turnaround.

Other cost reduction actions anticipated include increased Asian
sourcing and ongoing productivity improvements.  Goodyear said it
is targeting cost reductions totaling between $750 million and
$1 billion by 2008, through the restructuring and other cost
savings initiatives.

Goodyear will continue to evaluate its business portfolio with the
expectation of selling non-core assets and investing the proceeds
to become a stronger competitor.  Earlier this week, Goodyear
announced it is exploring the sale of its Engineered Products
business.  The company has already completed the sale of its
Wingtack adhesive resins business and its rubber plantation in
Indonesia.  Goodyear's sale of its North American farm tire
business is pending a union agreement.

Goodyear leaders will discuss plans for achieving their goals to
improve segment operating margin to 8 percent for the total
company and 5 percent for North American Tire through
implementation of these plans.  The company said it continues to
face several challenges, including increasing raw material costs,
uncertain global economic conditions, and pension funding
obligations that are expected to peak in 2006.  The pension
obligations may vary depending on potential legislative reform.

"Our turnaround is on track and will continue to evolve," Mr.
Keegan said.  "We have a business model and a strategy that is
working.  We believe we have the strongest leadership team in the
industry, and we are now a market-driven company.  We have a
passion for this business and are energized by the opportunities
ahead of us."

Further, Goodyear said it is currently assessing the impact of
Hurricane Katrina on its property, inventory and the overall
operations.  The company currently has five retail stores, which
are expected to remain closed for an indefinite period of time.
The financial impact resulting from the closure of these stores is
not expected to be material.  However, the company is still in the
process of assessing the potential overall financial impact.

The Goodyear Tire & Rubber Company (NYSE: GT) is the world's
largest tire company.  Headquartered in Akron, Ohio, the company
manufactures tires, engineered rubber products and chemicals in
more than 90 facilities in 28 countries.  It has marketing
operations in almost every country around the world.  Goodyear
employs more than 80,000 people worldwide.

                         *     *     *

As reported in the Troubled Company Reporter on June 23, 2005,
Fitch Ratings has assigned an indicative rating of 'CCC+' to
Goodyear Tire & Rubber Company's (GT) planned $400 million issue
of senior unsecured notes.

GT intends to issue $400 million of 10-year notes under Rule 144A.
Proceeds will be used to repay $200 million outstanding under the
company's first lien revolving credit facility and to replace
$190 million of cash balances that were used to pay $516 million
of 6.375% Euro notes that matured June 6, 2005.  The Rating
Outlook is Stable.

The rating reflects the substantial amount of senior secured debt
relative to the planned notes.  It also incorporates Fitch's
concerns about GT's high leverage, high-cost structure, and weak
profitability and cash flow.  In addition, GT's pension plans,
which were underfunded by $3.1 billion at the end of 2004, are
likely to require substantially higher contributions over the near
term.


GS CONSULTING: Chapter 7 Trustee Sues to Recover Estate Property
----------------------------------------------------------------
Joseph D. Bradley, the chapter 7 Trustee overseeing the
liquidation of GS Consulting Services, Inc.'s assets, initiated an
adversary proceeding in the U.S. Bankruptcy Court for the Northern
District of Indiana, South Bend Division, against several
entities.  The suit seeks possession of properties purchased by
the Debtor from business entities registered in Indiana.

In December 2004, the Debtor bought the assets of Healthcare
Economics Group, LLC, Facilities Management & Investments, Inc.,
and all of the assets of the "TPA Companies":

        a. Benefit Resource Administrators, Inc.
        b. The Calends Group, Inc.
        c. Horizon Management Group, LLC
        d. Healthcare Resources Group, LLC
        e. MedGuard, LLC
        f. MedRecover, LLC
        g. Pyramid Benefit Services, Inc.
        h. PCT Operations, Inc.
        i. Rockport Administrative Services, LLC
        j. StopLoss Commission Services, LLC

The Debtor also purchased the sellers ownership interests in
Management Administrative Services, LLC.

Under an asset purchase agreement, the assets sold to the Debtor
included funds contained in a General Claims Accounts and General
Premium Accounts.

After a discovery proceeding, the Trustee found out that many of
the sellers were registered as an assumed name for Management
Administrative Services, LLC, on June 24, 2004.  Also, the Trustee
found out that the premises listed by the sellers as their
business addresses are unoccupied.

                          Bank Accounts

The Debtor maintains 14 bank accounts with 1st Source Bank which
the Trustee wants to administer.

These accounts are named under The Calends Group, Inc., Benefit
Resource Administration, Horizon Management Group LLC, PCT
Operations, PCT Operations Inc., Pyramid Benefit Services Inc.,
and Healthcare Resources Group LLC.

The Trustee also asserts ownership of all future accounts of the
sellers.

The Trustee wants possession of these accounts.

Headquartered in South Bend, Indiana, GS Consulting Services,
Inc., provided health-care claims processing and consulting for
major Northern Indiana employers.  The Company and its debtor-
affiliates filed for chapter 7 liquidation proceeding on May 23,
2005 (Bankr. D. Del. Case No. 05-11464).  The Debtors' chapter 7
cases were transferred to the U.S. Bankruptcy Court for the
Northern District of Indiana on June 28, 2005 (Bankr. N.D. Ind.
Case No. 05-33646). Christopher M. Winter, Esq., at Duane Morris
LLP represents the Debtors.  When the Debtors filed for a chapter
7 liquidation proceeding, it estimated assets of $1 million to $10
million and debts of $10 million to $50 million.  Joseph D.
Bradley, Esq., is the chapter 7 Trustee for the Debtors' estates.


GS CONSULTING: Meeting of Creditors Continued on Oct. 18
--------------------------------------------------------
The U.S. Trustee for Region 10 will continue a meeting of GS
Consulting Services, Inc.'s creditors at 9:00 a.m., on
Oct. 18, 2005, at One Michiana Square, 5th Floor in South Bend,
Indiana.

All creditors are invited, but not required, to attend.  This
Meeting of Creditors offers the one opportunity in a bankruptcy
proceeding for creditors to question a responsible office of the
Debtor under oath about the company's financial affairs and
operations that would be of interest to the general body of
creditors.

Headquartered in South Bend, Indiana, GS Consulting Services,
Inc., provided health-care claims processing and consulting for
major Northern Indiana employers.  The Company and its debtor-
affiliates filed for chapter 7 liquidation proceeding on May 23,
2005 (Bankr. D. Del. Case No. 05-11464).  The Debtors' chapter 7
cases were transferred to the U.S. Bankruptcy Court for the
Northern District of Indiana on June 28, 2005 (Bankr. N.D. Ind.
Case No. 05-33646).  Christopher M. Winter, Esq., at Duane Morris
LLP represents the Debtors.  When the Debtors filed for a chapter
7 liquidation proceeding, it estimated assets of $1 million to
$10 million and debts of $10 million to $50 million.  Joseph D.
Bradley, Esq., is the chapter 7 Trustee for the Debtors' estates.


HEALTH RAMP: Voluntary Chapter 11 Case Summary
----------------------------------------------
Debtor: Health Ramp, Inc.
        33 Maiden Lane, 5th Floor
        New York, New York 10038

Bankruptcy Case No.: 05-18741

Type of Business: The Debtor is a wholly owned subsidiary of Ramp
                  Corporation, which filed for chapter 11
                  protection on June 2, 2005 (Bankr. S.D.N.Y.
                  Case No. 05-14006).

Chapter 11 Petition Date: September 26, 2005

Court: Southern District of New York (Manhattan)

Debtor's Counsel: Howard Karasik, Esq.
                  Sherman, Citron & Karasik, P.C.
                  152 West 57th Street
                  New York, New York 10019
                  Tel: (212) 582-7800
                  Fax: (212) 582-5354

Estimated Assets: $1 Million to $10 Million

Estimated Debts:  $10 Million to $50 Million

The Debtor does not have a list of its 20 Largest Unsecured
Creditors.


HEATING OIL: Files for Chapter 11 Protection in Connecticut
-----------------------------------------------------------
Heating Oil Partners, L.P., the operating subsidiary of Heating
Oil Partners Income Fund (TSX:HIF.UN), filed a voluntary petition
for reorganization under Chapter 11 of the United States
Bankruptcy Code in the U.S. Bankruptcy Court for the District of
Connecticut in Bridgeport.  The Company will also be seeking
recognition of the Chapter 11 proceedings under the Companies'
Creditors Arrangement Act (Canada).

Both the U.S. and Canadian filings include Heating Oil Partners,
G.P. Inc., the Company's general partner, and HOP Holdings, Inc.,
a 100% subsidiary of the Fund and an 88.1% owner of the Company.
The Fund is not directly a party to any of these filings.

The Company's decision to file for bankruptcy protection was a
result of several factors, including the record level of fuel oil
prices and the impact of those prices on both the Company's on-
going working capital requirements and operational performance.

"The Company has been engaged in a lengthy process to address its
capital structure, particularly its increased working capital
needs," Michael Anton, the Debtor's Chief Executive Officer, said.
"Unfortunately, the combination of unprecedented fuel oil prices
and diminished operational performance, specifically decreased
gross margins, an increase in overall operating expenses and
further customer attrition has made such a re-financing of the
Company's capital structure impossible to achieve outside of the
bankruptcy process."

The Debtor stated that it intends to maintain all normal business
operations throughout the bankruptcy process.  Specifically, it
expects to continue:

   -- delivering heating oil and other petroleum products to all
      existing and new customers, including any customers who may
      have pre-paid the Company for their fuel costs for the
      upcoming winter season;

   -- providing customers with a variety of pricing options

   -- honoring all protected price, service and installation
      commitments to its customers;

   -- paying vendors for inventory, parts and services received
      during the reorganization process; and

   -- providing employees with uninterrupted wages, healthcare
      coverage, vacation and sick leave.

                       DIP Financing

To fund its continuing operations during the restructuring
process, the Company has negotiated a commitment of up to
US$115 million debtor-in-possession revolving credit facility from
a group of lenders led by Bank of America.  The DIP facility,
which will be used to meet the Company's working capital needs
throughout the reorganization process, is subject to court
approval and the potential objection by the Company's pre-petition
lenders.

M. Douglas Young, Chairman of the Board of Trustees of the Fund,
stated, "On behalf of the entire Board of Trustees, I want to
express our disappointment that we have been unable to achieve our
desired levels of performance at the Fund and the Company in the
current environment, and within the Company's existing operating
constraints.  We deeply regret the adverse effect [yester]day's
action will have on the Fund's unitholders."

Unitholders will be kept apprised of developments affecting the
Fund and the Company as the restructuring process advances.  The
Fund cautioned that, given the level of financing provided by
secured creditors of the Company, it is unlikely that unitholders
will receive any consideration in respect of the Fund's investment
upon completion of the restructuring process.

                     First Day Motions

The Debtor has filed a series of first day motions in the
Bankruptcy Court in Bridgeport, Connecticut to ensure that the
Company will not have any interruption in maintaining and honoring
all of its commitments to its customers.  The motions also address
the Company's continued ability to pay its vendors, the retention
of various professional advisors and other matters.  RSM Richter
Inc. will be proposed as the Court-appointed Information Officer
in Canada under the CCAA.

Company employees will be paid in the usual manner and their
health and welfare benefits are expected to continue without
disruption.  The Company's 401(k) plan is maintained independently
of the Company, is protected under federal law and will continue
to be administered as usual.

The Fund indirectly owns approximately 88.1% of Heating Oil, one
of the largest residential heating oil distributors in the United
States.  The Debtor delivered over 236 million gallons of heating
oil and other refined liquid petroleum products for the twelve
months ended June 30, 2005, to approximately 137,000 residential,
fleet and commercial customers, primarily in Connecticut,
Delaware, Maryland, Massachusetts, New Jersey, New Hampshire, New
York, Pennsylvania, Rhode Island, Virginia and the District of
Columbia.  The Debtor's operations are conducted through 16
regional distribution and service centres.  From these centres,
the Debtor provides its customers with a full range of value-added
services, including the delivery of heating oil and the
installation, maintenance and service of furnaces, boilers,
heating equipment and air conditioners on a 24 hours-a-day, 365
days-a-year basis.

Headquartered in Darien, Connecticut, Heating Oil Partners, L.P.
-- http://www.hopheat.com/-- is one of the largest residential
heating oil distributors in the United States, serving
approximately 150,000 customers in the Northeastern United States.
The Company's primary business is the distribution of heating oil
and other refined liquid petroleum products to residential and
commercial customers.  The Company and its subsidiaries filed for
chapter 11 protection on Sept. 26, 2005 (Bankr. D. Conn. Case No.
05-51271).  Craig I. Lifland, Esq., and James Berman, Esq., at
Zeisler and Zeisler, represent the Debtors in their restructuring
efforts.  When the Debtors filed for protection from their
creditors, they listed $127,278,000 in total assets and
$155,033,000 in total debts.


HEATING OIL: Case Summary & 20 Largest Unsecured Creditors
----------------------------------------------------------
Lead Debtor: Heating Oil Partners, L.P.
             1120 Post Road
             Darien, Connecticut 06820

Bankruptcy Case No.: 05-51271

Debtor affiliates filing separate chapter 11 petitions:

      Entity                                     Case No.
      ------                                     --------
      Heating Oil Partners GP Inc.               05-51272
      HOP Holdings, Inc.                         05-51274

Type of Business: The Debtor is one of the largest residential
                  heating oil distributors in the United States,
                  serving approximately 150,000 customers in the
                  Northeastern United States.  The Company's
                  primary business is the distribution of heating
                  oil and other refined liquid petroleum products
                  to residential and commercial customers.
                  See http://www.hopheat.com/

Chapter 11 Petition Date: September 26, 2005

Court: District of Connecticut (Bridgeport)

Judge: Alan H.W. Shiff

Debtors' Counsel: Craig I. Lifland, Esq.
                  James Berman, Esq.
                  Zeisler and Zeisler
                  558 Clinton Avenue
                  P.O. Box 3186
                  Bridgeport, Connecticut 06605
                  Tel: (203) 368-4234
                  Fax: (203) 367-9678

Total Assets: $127,278,000

Total Debts:  $155,033,000

Consolidated List of Debtors' 20 Largest Unsecured Creditors:

   Entity                                 Claim Amount
   ------                                 ------------
Tom Antonelli, Inc.                            $14,001
Green Lane Industrial Complex
2201 Hunter Road
Bristol, PA 19007

RE Michel                                       $7,172
1 RE Michel Way
Glen Burnie, MD 21060

Air Purchases, Inc.                             $6,784
24 Blanchard Road
Burlington, MA 01803

J&R Towing recovery & RPR                       $5,790
3 Tow Road
Wareham, MA 02571

Verizon                                         $5,592
P.O. Box 2800
Lehigh Valley, PA 18002

Shetucket Plumbing Norwich                      $5,299

Con Edison                                      $5,066

R.F. Clemens & Son, Inc.                        $4,467

Bradley Marketing Group                         $4,133

Brian Bingham                                   $3,800

EStaffControl USS                               $3,404

Stephen Elliot Co. Inc.                         $3,300

Bayonne Plumbing Supply Co.                     $3,297

Waterair                                        $2,988

Paetec Communications, Inc.                     $2,960

Lefferts Oil Terminal, Inc.                     $2,934

Cingular Wireless                               $2,851

Sid Harvey Industries, Inc.                     $2,673

Killingly Tax Collector                         $2,566

Snow & Jones                                   Unknown


HOLLINGER INT'L: Board Declares $0.05 Dividend for Common Shares
----------------------------------------------------------------
Hollinger International Inc.'s (NYSE: HLR) Board of Directors
declared a quarterly dividend of $0.05 per share on the issued and
outstanding common stock of the Company to be payable October 17,
2005 to stockholders of record on October 3, 2005.

Hollinger International Inc. is a newspaper publisher whose assets
include The Chicago Sun-Times and a large number of community
newspapers in the Chicago area as well as in Canada.

                         *     *     *

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

Ratings withdrawn:

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

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

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

Ratings confirmed:

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

Moody's says the outlook is changed to positive.


HOUSE2HOME: Court Approves GMAC Pact to Resolve Contested Claim
---------------------------------------------------------------
The Honorable James N. Barr of the U.S. Bankruptcy Court for the
Central District of California, Santa Ana Division, approved a
stipulation between House2Home, Inc., and GMAC Commercial Finance,
LLC, as successor in interest to GMAC Commercial Credit, LLC, to
resolve a contested claim.

GMAC filed a Proof of Claim, No. 358 for $335,338.11, asserting a
prepetition, non-priority, unsecured claim.  The Debtor objects to
GMAC's claim.  The parties resolved the dispute by allowing Claim
No. 358 as a prepetition, non-priority, unsecured claim for
$296,175.28.

The parties further agree that all pending litigation filed by
GMAC against the Debtor be dismissed with prejudice and any
distributions received by GMAC will satisfy any lien on this
claim.

House2Home, Inc., stores offer an expansive selection of specialty
home decor merchandise across four broad product categories --
outdoor living, indoor living, home decor and accessories, and
seasonal goods.  The Company filed for chapter 11 protection on
November 7, 2001, (Bankr. C.D. Calif. Case No. 01-19244).  Oscar
Garza, Esq., at Gibson, Dunn & Crutcher represents the Debtor in
this liquidating proceeding.  When the Debtor filed for protection
from its creditors, it listed $181,244,162 in assets and
$192,961,553 in liabilities.


IGENE BIOTECHNOLOGY: Completes 50% of Financial Restatements
------------------------------------------------------------
IGENE Biotechnology, Inc., can't prepare and file its 2004 Annual
Report or its Quarterly Reports for the quarters ending March 31,
2005, and June 30, 2005, until it restates its 2003 and 2004
financials and files amended reports with the Securities and
Exchange Commission.

As reported in a Form 8-K filed with the SEC on May 16, 2005,
IGENE received a letter on May 12, 2005 from Berenson LLP, its
independent registered public accounting firm, notifying the
Company that its Financial Statements 2003 and 2004 should no
longer be relied upon because they contain errors.

The errors in the suspect Financial Statements relate to the
accounting treatment of the Company's 50% participation in a joint
venture with Tate & Lyle that produces Aquasta(TM) for the
aquaculture industry at Tate & Lyle's facility in Selby, England.

IGENE must amend six regulatory filings before it can prepare and
file its final 2004 and interim 2005 financial statements; three
of those amended filings have been delivered to the SEC to date:

   SEC Filing             Amended SEC Filing Now
   Requiring Amendment    Available at No Charge At
   -------------------    -------------------------
   Quarterly Report on    http://ResearchArchives.com/t/s?19b
   Form 10-QSB for the    (Amendment filed July 28, 2005)
   quarterly period
   ended June 30, 2003

   Quarterly Report on    http://ResearchArchives.com/t/s?19a
   Form 10-QSB for the    (Amendment filed July 28, 2005)
   quarterly period
   ended Sept. 30, 2003

   Annual Report on       http://ResearchArchives.com/t/s?199
   Form 10-KSB for the    (Amendment filed Sept. 6, 2005)
   year ended
   December 31, 2003

   Quarterly Report on    Not yet amended
   Form 10-QSB for the
   quarterly period
   ended March 31, 2004

   Quarterly Report on    Not yet amended
   Form 10-QSB for the
   quarterly period
   ended June 30, 2004

   Quarterly Report on    Not yet amended
   Form 10-QSB for the
   quarterly period
   ended Sept. 30, 2004

Berenson has advised Igene that its investment in the Joint
Venture should have been recorded with a book value of zero; not
the $12,000,000 initially recorded in the erroneous Financial
Statements.  This adjustment materially erodes Igene's asset base.
Igene's original and restated financials show liabilities
exceeding assets.

Auditors at STEGMAN & COMPANY in Baltimore, Maryland, expressed
doubt about IGENE's ability to continue as a going concern when it
audited the company's 2003 financials.  The auditors pointed to
IGENE's recurring losses, production limitations and limited
capitalization.

Based in Columbia, Maryland, IGENE Biotechnology, Inc., develops,
markets and manufactures specialty ingredients for human and
animal nutrition.  Igene is a supplier of natural astaxanthin, an
essential nutrient in different feed applications and a source of
pigment for coloring farmed salmon species.


INTERMET CORP: Court Confirms Amended Plan of Reorganization
------------------------------------------------------------
The U.S. Bankruptcy Court for the Eastern District of Michigan
confirmed INTERMET Corporation (INMTQ:PK) and its debtor-
affiliates Amended Plan of Reorganization dated Aug. 12, 2005.
The confirmation is subject to the entry of a formal confirmation
order.

"Today, INTERMET's customers, employees and new business partners
received a clear vote of confidence in our company," said Gary F.
Ruff, Chairman and CEO of INTERMET.  "This is a very important
event for our company, and one that also defines our future
direction.  The confirmed Plan is crafted to provide the resources
we need to execute our business strategy, and I am confident that
we will meet our new goals.  I would like to thank the more than
5,000 INTERMET employees, our valued customers, and creditors for
their support during this challenging period."

                      Terms of the Plan

The Plan contemplates that each of the Debtors will become
reorganized entities after consummation of the Plan.  The Plan is
jointly proposed by all of the Debtors, but constitutes a separate
plan for each Debtor.

                   General Unsecured Claims

The Debtors estimate that General Unsecured Claims against their
estates total:

   Debtor                              Allowed Claim
   ------                              -------------
   Intermet Corp.                       $189,197,093
   Alexander City
      Casting Company, Inc.              179,931,240
   Cast-Matic Corporation                183,197,759
   Columbus Foundry, L.P.                189,397,046
   Diversified Diemakers, Inc.           183,291,005
   Ganton Technologies, Inc.             187,016,248
   Intermet Illinois, Inc.               181,331,240
   Intermet International, Inc.               14,000
   Intermet U.S. Holding, Inc.           185,889,247
   Ironton Iron, Inc.                    182,736,103
   Lynchburg Foundry                     189,342,671
   Northern Castings Corporation         181,482,233
   Sudbury, Inc.                         182,804,825
   Tool Products, Inc.                   186,138,827
   Wagner Castings Company               184,580,140
   Wagner Havana, Inc.                  $181,369,667
                                       --------------
                                       $2,767,719,344

The Plan promises general unsecured creditors:

   (a) a cash-out amount on account of their claims;

   (b) at the option of each holder:

        (i) a pro rata share of the applicable Debtor's New
            Common Stock; and

       (ii) a pro rata share of the rights allocated to the
            applicable Debtor as described in the Plan; or

   (c) at the option of each holder, an inducement cash amount.

The unsecured portion of the Noteholders' claims will be satisfied
by a cash payment from the sale proceeds of the respective
Debtor's assets.

If the Liquidating Plan condition is satisfied, the Indenture
Trustee will receive the indenture trustee fee amount and a cash-
out amount allocated to the applicable Debtor:

   Debtor                              Allowed Claim
   ------                              -------------
    SUDM, Inc.                           $179,931,240
    Wagner Havana, Inc.                  $181,369,667

Unsecured convenience claimholders will be paid out of the
Convenience Cash Amount, according to the terms of the Plan, after
the effective date.

                       Exit Financing

INTERMET has received a commitment letter from Goldman, Sachs &
Co. for an exit financing facility which will fund its operations
post-bankruptcy.  The parties are in the process of negotiating
the terms of a definitive credit covenant.

INTERMET currently expects that it will enter into the post-
bankruptcy credit facility, satisfy the other conditions to Plan
effectiveness and emerge from Chapter 11 during the month of
October 2005.

A full-text copy of the Debtor's Amended Plan of Reorganization is
available at no charge at http://ResearchArchives.com/t/s?1d6

A full-text copy of the Disclosure Statement explaining the
Amended Plan is available at no charge at
http://ResearchArchives.com/t/s?1d7

Headquartered in Troy, Michigan, Intermet Corporation --
http://www.intermet.com/-- provides machining and tooling
services for the automotive and industrial markets specializing
in the design and manufacture of highly engineered, cast
automotive components for the global light truck, passenger car,
light vehicle and heavy-duty vehicle markets.  Intermet, along
with its debtor-affiliates, filed for chapter 11 protection on
Sept. 29, 2004 (Bankr. E.D. Mich. Case Nos. 04-67597 through
04-67614).  Salvatore A. Barbatano, Esq., at Foley & Lardner LLP
represents the Debtors.  When the Debtors filed for protection
from their creditors, they listed $735,821,000 in total assets
and $592,816,000 in total debts.


INTERSTATE BAKERIES: Dist. Ct. Okays Final Class Action Settlement
------------------------------------------------------------------
Judge Fernando J. Gaitan, Jr., of the United States District
Court for the Western District of Missouri, gave final approval
of an $18 million settlement of a class action complaint filed
against Interstate Bakeries Corporation and three of its former
executives:

    (1) Charles A. Sullivan, former chief executive officer and
        chairman;

    (2) Frank W. Coffey, former chief financial officer; and

    (3) James R. Elsesser, Mr. Sullivan' successor as chief
        executive officer and chairman.

The Class Action is entitled Smith v. Interstate Bakeries Corp.,
et al., Case No. 03-0142-V-W-FJG (W.D. Mo.)

Pursuant to the parties' settlement, Interstate Bakeries'
insurance carriers will pay $15,000,000 to the Class Members and
the Class will have a $3,000,000 liquidated, subordinated,
unsecured claim in the IBC bankruptcy estate.

The District Court finds that the Class meets all of the
requirements of Rule 23 of the Federal Rules of Civil Procedure.
Accordingly, Judge Gaitan certifies for settlement purposes a
Class consisting of all persons or entities that purchased, sold,
exchanged, acquired, disposed of, or transferred IBC common stock
between April 2, 2002, and April 8, 2003.

The Class certified by the District Court does not include:

    (a) persons or entities who submitted valid and timely
        requests for exclusion from the Class;

    (b) persons or entities who, while represented by counsel,
        settled an actual or threatened lawsuit or other
        proceeding with IBC or a Defendant, and released IBC and
        the Releasees from any further claims concerning their
        purchase, sale, exchange, acquisition, disposal, or
        transfer involving IBC common stock during the Class
        Period;

    (c) persons or entities who are or were Defendants; Family
        Members of any Defendant; any entity in which IBC or a
        Defendant has or had a Controlling Interest; the legal
        representatives, heirs, executors, successors or assigns
        of any person or entity requesting exclusion from the
        Class or any current or former directors or officers of
        IBC or of an entity in which IBC had a Controlling
        Interest.

The District Court further rules that the Class' Lead Counsel
will be awarded 25% of both the $15 million cash settlement and
the $3 million unsecured claim against IBC; and $132,154, in
reimbursement of expenses.

Judge Gaitan dismisses the Class Action Complaint, including all
individual claims and Class claims, with prejudice, without fees
or costs to any party except as otherwise provided.


Headquartered in Kansas City, Missouri, Interstate Bakeries
Corporation is a wholesale baker and distributor of fresh baked
bread and sweet goods, under various national brand names,
including Wonder(R), Hostess(R), Dolly Madison(R), Baker's Inn(R),
Merita(R) and Drake's(R).  The Company employs approximately
32,000 in 54 bakeries, more than 1,000 distribution centers and
1,200 thrift stores throughout the U.S.

The Company and seven of its debtor-affiliates filed for chapter
11 protection on September 22, 2004 (Bankr. W.D. Mo. Case No.
04-45814). J. Eric Ivester, Esq., and Samuel S. Ory, Esq., at
Skadden, Arps, Slate, Meagher & Flom LLP, represent the Debtors in
their restructuring efforts.  When the Debtors filed for
protection from their creditors, they listed $1,626,425,000 in
total assets and $1,321,713,000 (excluding the $100,000,000 issue
of 6.0% senior subordinated convertible notes due August 15, 2014,
on August 12, 2004) in total debts.  (Interstate Bakeries
Bankruptcy News, Issue No. 27; Bankruptcy Creditors' Service,
Inc., 215/945-7000)


INTERSTATE BAKERIES: Wants to Pay Tax & Other Secured Claims
------------------------------------------------------------
Interstate Bakeries Corporation and its debtor-affiliates seek
discretionary authority to compromise, settle, and, if
appropriate, pay certain prepetition real property tax claims and
other secured claims that are accruing collectible postpetition
interest or penalties.

According to J. Eric Ivester, Esq., at Skadden Arps Slate Meagher
& Flom LLP, in Chicago, Illinois, 225 claims have been filed
against the Debtors for secured real and personal property taxes,
totaling over $2.5 million.  Approximately 50 claims have been
filed for other secured liabilities for over $1 million.

Much of the Debtors' liability may be secured by statutory liens
against estate assets that arguably "ride through" irrespective
of any failure to file proofs of claim, Mr. Ivester relates.

Based the tax bills received and estimates of their current tax
liabilities from prior tax years, the Debtors believe that they
may have as much as $7.5 million in outstanding liabilities for
real property taxes and almost $4 million for non-vehicle
personal property taxes.

The Debtors are not currently paying any prepetition or disputed
tax claims except where granted specific Court approval in
conjunction with the sales of their assets, Mr. Ivester states.

Certain unpaid Secured Tax and Other Claims are accruing, under
applicable state and federal law, postpetition interest and
penalties for which the Debtors may be liable under the
Bankruptcy Code, Mr. Ivester tells the U.S. Bankruptcy Court for
the Western District of Missouri.

The Debtors estimate that they will incur tens of thousands of
dollars in additional liability over the pendency of their
Chapter 11 cases if the Secured Tax and Other Claims remain
unpaid.

Mr. Ivester asserts that the Debtors can significantly reduce
their aggregate secured liability in their bankruptcy cases if
they can pay the tax clams that are accruing collectible
postpetition interest and penalties.

Moreover, the Debtors dispute the amounts asserted by a large
number of the Secured Tax and Other Claims.  The Debtors may
choose to object to a number of these claims and engage in
significant and often aggressive negotiations to limit their
exposure.

Mr. Ivester contends that the Debtors will have a much stronger
negotiation position if they can agree to prompt payment as part
of their settlement offer.  Mr. Ivester points out that certain
jurisdictions will postpone settlement discussion until the
Debtors can guaranty a date of payment of any agreed upon
amounts.

                         Notice Procedures

The Debtors propose these notice procedures with respect to the
settlement and payment of the Secured Tax and Other Claims:

    (a) Where the settlement amount does not exceed $50,000, the
        Debtors will pay Secured Tax and Other Claims without the
        need for further Court approval or further notice to any
        party-in-interest;

    (b) Where the settlement amount is $50,000 or more, the
        Debtors will give notice of the proposed settlements with
        the applicable taxing or other governmental authorities
        to:

           -- counsel for the various committees established in
              the Debtors' cases;

           -- counsel for the prepetition lenders; and

           -- counsel for the postpetition lenders;

    (c) The Notice Parties will have 10 days after the Notices are
        sent to them to object or to request additional
        information to evaluate a Proposed Settlement;

    (d) Objections or requests for additional information
        regarding the Proposed Settlements must be sent to Samuel
        Ory, Esq., at Skadden, Arps, Slate, Meagher & Flom, LLP,
        in Chicago, Illinois, by the Notice Deadline;

    (e) Timely objections will be resolved consensually between
        the parties through good faith efforts.  If not, the
        Debtors may seek Court approval of the Proposed Settlement
        upon notice and a hearing;

    (f) The Debtors will prepare reports of claims that have been
        settled in amounts not to exceed $50,000.  These De
        Minimis Secured Paid Claims Reports will be circulated to
        the Notice Parties every 120 days; and

    (g) The Debtors, in their sole discretion, may seek Court
        approval at any time of any Proposed Settlement after
        notice and a hearing.

Mr. Ivester asserts that the proposed Notice Procedures represent
the best and most efficient method of minimizing the
administrative liability of the Debtors' estates related to
Secured Tax and Other Claims and are within the Debtors' ordinary
business practices.

Headquartered in Kansas City, Missouri, Interstate Bakeries
Corporation is a wholesale baker and distributor of fresh baked
bread and sweet goods, under various national brand names,
including Wonder(R), Hostess(R), Dolly Madison(R), Baker's Inn(R),
Merita(R) and Drake's(R).  The Company employs approximately
32,000 in 54 bakeries, more than 1,000 distribution centers and
1,200 thrift stores throughout the U.S.

The Company and seven of its debtor-affiliates filed for chapter
11 protection on September 22, 2004 (Bankr. W.D. Mo. Case No.
04-45814). J. Eric Ivester, Esq., and Samuel S. Ory, Esq., at
Skadden, Arps, Slate, Meagher & Flom LLP, represent the Debtors in
their restructuring efforts.  When the Debtors filed for
protection from their creditors, they listed $1,626,425,000 in
total assets and $1,321,713,000 (excluding the $100,000,000 issue
of 6.0% senior subordinated convertible notes due August 15, 2014,
on August 12, 2004) in total debts.  (Interstate Bakeries
Bankruptcy News, Issue No. 27; Bankruptcy Creditors' Service,
Inc., 215/945-7000)


JERNBERG INDUSTRIES: Wants Chapter 11 Cases Converted to Chapter 7
------------------------------------------------------------------
Jernberg Industries, Inc., and its debtor-affiliates ask the U.S.
Bankruptcy Court for the Northern District of Illinois to convert
their chapter 11 cases into a chapter 7 liquidation.  The Debtors
also ask the Court to approve payment of the chapter 11
professionals' final fee applications.

As reported in Troubled Company Reporter on Sept. 9, 2005, KPS
Special Situations Fund II completed the acquisition of
substantially all of the assets of Jernberg Industries, Inc., Iron
Mountain Industries, LLC and related entities.  KPS acquired the
assets through a newly formed company, Hephaestus Holdings, Inc.,
for $1.25 million in cash and the assumption of certain of the
Debtors' liabilities.  The Debtors believe that the aggregate
value of the Offer exceeds $60 million.  The transaction was
accomplished pursuant to a 363 sale of assets under Chapter 11 of
the U.S. Bankruptcy Code.

The Debtors told the Court that when the parties closed the sale
on Sept. 7, 2005, it ceased all operations and terminated all of
their employees.  The Debtors say that as of Sept. 20, 2005, all
but one of the members of the Debtors' board of directors has
resigned.

                      Conversion to Chapter 7

The Debtors say that the ongoing administrative expenses of
maintaining a bankruptcy proceeding under chapter 11 and the
absence of any source of operating revenue are causing the value
of their estates to erode.  The Debtors believe that converting
the case to chapter 7 liquidation makes good business sense.

The Debtors say that converting the case to chapter 7 will:

    (a) preserve the remaining assets of the Debtors;

    (b) reduce administrative expenses by substituting one set of
        professionals (of the chapter 7 trustee) for the three
        sets of professionals (of the Debtors, the Committee and
        the Committee of Non-Union Retirees); and

    (c) eliminate the cost and expenses of a plan, disclosure
        statement and solicitation procedures.

The Debtors tell the Court that upon conversion to chapter 7, the
Debtors' assets will consist of approximately $1.25 million in
cash.  The Debtors believe that the assets will be sufficient for
the chapter 7 trustee to pay all chapter 7 and chapter 11
administrative expenses in full, and to make a distribution on
account of priority and general unsecured claims.

The Debtors also disclosed that should the case be converted to
chapter 7, to facilitate the chapter 7 trustee's efforts, they
will:

    (a) file a schedule of unpaid debts incurred after the
        petition date and before the conversion date; and

    (b) file and transmit to the U.S. Trustee a final report and
        account.

The Debtors propose that the chapter 11 cases be converted to a
chapter 7 liquidation effective 12:01 a.m. on the 11th day after
entry of the orders granting the Final Feel Applications filed by
the chapter 11 professionals.

                    Final Fee Applications

The Debtors ask the Court that prior to the conversion of the
case, all professionals retained in the chapter 11 cases file
their final fee applications, including an estimate of anticipated
fees and expenses from the date of the final applications through
the date of the hearing, no later than Sept. 29, 2005.

The Debtors also ask that the hearing on the Final Fee Application
be held at 9:30 a.m., on Oct. 6, 2005.  Any objection must be
filed and served so as to be received by the Debtors and the
Notice Parties on or before Oct. 4, 2005, the Debtors also ask the
Court.

Finally, the Debtors propose that each chapter 11 professional
file an affidavit setting forth the actual amount of fees and
expenses no later than 2 days before the hearing for the final fee
applications.

                  Shorten and Limited Notice

The Debtors argue that cause exists to limit and shorten notice of
the Motion to convert the Bankruptcy Cases to the notice already
given.  The Debtors say that because they have the automatic right
to convert the Bankruptcy Cases to chapter 7 pursuant to section
1112(a) of the Bankruptcy Code, little or no purpose will be
served by:

    (1) requiring a 20-day notice of the Motion or

    (2) serving such notice on all creditors, equity security
        holders and other parties in interest.

The Debtors disclose that cause exists to shorten notice of the
Final Fee Applications and the hearing thereon.  The Interim
Compensation Order limits notice of the filing of fee applications
in the Bankruptcy Cases to the Notice Parties, consisting of the
Debtors, counsel to the Debtors, counsel to the Committee, counsel
to LaSalle Bank and the United States Trustee.

The Final Fee Applications will only seek approval of additional
fees and expenses covering a 34-day period from September 1
through October 5, so the Notice Parties (and the Court) should
have sufficient time to review and analyze the Final Fee
Applications prior to the objection deadline and the hearing, the
Debtors tell the Court.

Headquartered in Chicago, Illinois, Jernberg Industries, Inc., --
http://www.jernberg.com/-- is a press forging company that
manufactures formed and machined products.  The Company and its
debtor-affiliates filed for chapter 11 protection on June 29, 2005
(Bankr. N.D. Ill. Case No. 05-25909).  Jerry L. Switzer, Jr.,
Esq., at Jenner & Block LLP represents the Debtors in their
restructuring efforts.  When the Debtors filed for protection from
their creditors, they estimated assets and debts of $50 million to
$100 million.  CM&D Management Services, LLC's A. Jeffery Zappone
serves as the Debtors' Chief Restructuring Officer.  CM&D Joseph
M. Geraghty sits as Cash and Restructuring Manager and Joshua J.
Siano, Gerald B. Saltarelli and J. David Mathews serve as Cash and
Restructuring Support personnel.


KBSH LEADERS: Investment Managers Present Plan to Dissolve Trust
----------------------------------------------------------------
The Board of Directors of KBSH Capital Management Inc., the
manager and investment manager of KBSH Leaders Trust (TSX:KLT.UN),
authorized presenting to unitholders of the Trust a plan for the
liquidation, dissolution and winding up of the Trust.

A special Unitholder meeting has been called and will be held on
Nov. 23, 2005, where Unitholders will be asked to vote upon a
special resolution requiring the approval of two-thirds of the
Unitholders represented at the special meeting to approve the
liquidation, dissolution and winding up of the Trust.

Details of the plan will be outlined in a management information
circular and proxy statement to be prepared and delivered to
Unitholders of the Trust at the end of October 2005.  The reasons
for the wind-up are:

   (1) the net assets of the Trust have declined to the point
       relative to the ongoing expenses of the Trust where it has
       become uneconomical to operate the Trust from a unitholder
       perspective; and

   (2) the units of the Trust which are listed on the TSX are
       thinly traded.

If the special resolution is approved by Unitholders, the assets
of the Trust will be liquidated and at least one liquidating
distribution, equal to the net asset value at that time, will be
paid to Unitholders of the Trust shortly thereafter.  If
Unitholders do not approve the special resolution, the Trust will
continue as it is currently being operated.

KBSH Leaders Trust invests 100% of its capital in a diversified
portfolio of primarily U.S. equity securities.  These are
supplemented by a selection of Canadian & International
securities.  In addition, a significant portion of the portfolio
are invested in companies who are emerging leaders in their
industry, with a market cap of between US$5 billion and
US$20 billion.


KERZNER INT'L: Accepts 99.22% of $400 Mil. Sr. Sub. Notes in Offer
------------------------------------------------------------------
Kerzner International Limited (NYSE: KZL) and its wholly owned
subsidiary, Kerzner International North America, Inc. reported
that as of 5:00 p.m. EST on Sept. 21, 2005, they had received the
tenders and consents required to eliminate or modify certain
covenants and related provisions in the indenture governing their
outstanding 8-7/8% senior subordinated notes due 2011.

As of the Consent Date, approximately 99.22% of the $400 million
aggregate principal amount outstanding of the Notes were received
and accepted for payment by the Company and KINA.

The Company paid the total consideration of $1,082.83 per $1,000
aggregate principal amount of Notes validly tendered on or prior
to the Consent Date on September 22, 2005 by delivery to the
depositary.

Furthermore, the Company, KINA and the trustee have executed a
supplemental indenture containing certain amendments to the
indenture, as described in the Offer to Purchase and Consent
Solicitation Statement dated Sept. 12, 2005.  The Company used the
proceeds of a new offering of $400 million 6-3/4% senior
subordinated notes that closed on September 22, 2005, together
with cash on hand, to repay the tendered Notes.

Holders of Notes can still tender their Notes until 12:01 a.m. EST
on Oct. 8, 2005.  Holders who validly tender their Notes after the
Consent Date and on or prior to the Expiration Date are entitled
to receive $1,060.58 per $1,000 aggregate principal amount of
Notes validly tendered, which represents the total consideration
less the consent payment.

Copies of the tender offer and consent solicitation documents can
be obtained by contacting MacKenzie Partners, Inc., the tabulation
agent and information agent for the consent solicitation, at 800-
322-2885 (toll free) and 212-929-5500.

Deutsche Bank Securities Inc. is acting as dealer manager for the
tender offer and solicitation agent for the consent solicitation.
Questions concerning the tender offer and consent solicitation may
be directed to Deutsche Bank Securities Inc., High Yield Capital
Markets, at 800-553-2826 (toll free).

Kerzner International Limited engages in the development and
operation of destination resorts, luxury resort hotels, and gaming
properties worldwide.  The company was incorporated as Sun
International Hotels Limited in 1993 and changed its name to
Kerzner International Limited in 2002.  Kerzner is headquartered
in Paradise Island, The Bahamas.

                         *     *     *

As reported in the Troubled Company Reporter on Sept. 19, 2005,
Moody's Investors Service assigned a B2 rating to Kerzner
International Limited's proposed $400 million guaranteed senior
subordinated notes due 2015, and affirmed the company's Ba3
Corporate Family Rating and stable rating outlook.  The notes are
offered pursuant to Rule 144A of the Securities Act of 1933.
Proceeds of the note offering will be used, together with cash on
hand, to repurchase all of Kerzner's 8-7/8% guaranteed senior
subordinated notes tendered for pursuant to a tender offer
launched on August 12, 2005.  The B2 rating on the 8 7/8% notes
will be withdrawn once the notes are redeemed.

As reported in the Troubled Company Reporter on Sept. 19, 2005,
Standard & Poor's Ratings Services assigned its 'B' rating to
Kerzner International Ltd.'s proposed $400 million senior
subordinated notes due 2015.  Proceeds from these notes, along
with cash on hand, will be used to refinance its existing
$400 million senior subordinated notes due 2011 and to fund fees
and expenses associated with this transaction.

At the same time, Standard & Poor's affirmed its ratings,
including its 'BB-' corporate credit rating, on the hotels and a
casino owner and operator.   S&P said the outlook on Kerzner
remains stable.


LIMELIGHT MEDIA: June 30 Balance Sheet Upside-Down by $266,545
--------------------------------------------------------------
Limelight Media Group, Inc., delivered its quarterly report on
Form 10-QSB for the quarter ending June 30, 2005, to the
Securities and Exchange Commission on Sept. 1, 2005.

The Company reported $26,792 of net income on $1,016,966 of net
revenues for the quarter ending June 30, 2005.

At June 30, 2005, Limelight had liquid assets of $1,072,259,
consisting of cash, accounts receivable derived from operations
and inventory.  Long-term assets of $469,166 consisted primarily
of computer servers and video display equipment used in
operations.

Current liabilities of $3,211,043 at June 30, 2005 consisted
primarily of $2,211,523 of accounts payable and notes payable,
including related party amounts.  After June 30, 2005, certain
officers and directors holding approximately $1.7 million
aggregate principal amount of promissory notes have agreed, in
principle, to cancel such notes in consideration of the issuance
of options to purchases an aggregate of 16,766,820 shares of
Limelight common stock having an exercise price of $0.10 per
share.

The Company's working capital deficit was $2,128,482 as of
June 30, 2005

                    Related Party Transaction

On June 30, 2005, Impart entered into an Agreement with Media
Sidestreet Support Corporation whereby Impart purchased the assets
of Media Sidestreet in exchange for the issuance of notes in the
aggregate principal amount of $1,027,965 to the owners of Media
Sidestreet.  The notes are unsecured, with interest ranging from
6% to 10% (two notes include variable interest rates), and are
payable on the earlier of June 30, 2006 or the closing of a PIPE
financing transaction by the Company.  Prior to the Impart
Transaction, the majority owners of Impart were also owners in
Media Sidestreet, thus a related party transaction.

                       Zero Cash Balance

At June 30, 2005, the Company had a cash balance of $0.  Since
2002, its principal sources of liquidity have been:

    * the issuance of debt and equity securities, primarily to
      related parties, and

    * borrowings from lending institutions.

Its current cash levels, together with the cash flows generated
from operating activities, are not sufficient to enable Limelight
to continue its operations at current levels.  Management believes
that anticipated cash flows from recent and near-term scheduled
deployments of its digital signage network will allow Limelight to
achieve "break-even" during the first quarter of 2006.  As a
result, management intends to seek additional capital through the
sale of shares of Limelight's common stock to institutional
investors or other "accredited investors" in private placements in
order to provide the Company with sufficient working capital to
sustain operations until such time, and to allow it to pay off its
existing credit facility.

                   Wants to Borrow $1.5 Million

Limelight is currently in preliminary discussions with an
institutional lender to obtain a loan in the amount of $1.5
million.  Management anticipates that the closing of such
financing will be contingent upon, among other conditions, the
recapitalization of the Company to increase its number of
authorized but unissued common stock, which it intends to effect
in October 2005.

There can be no assurance that the Company will be able to
consummate the proposed financing transaction, or that any such
transaction will be consummated on terms favorable to it.  Even if
successful in obtaining such financing, Limelight will still
require additional capital to execute its growth strategy of
expanding its digital signage network and acquiring other digital
signage companies that management believes are financially
accretive with Limelight.

                      Lines of Credit

As of June 30, 2005, the Company's lines of credit consist of a
bank line of credit for borrowing up to $200,000, secured by the
Company's assets, bearing interest at 11% per annum, payable in
monthly installments of interest only, matures December 2006, and
an American Express business capital line for borrowing up to
$54,000, unsecured, bearing avariable interest rate (28.24% at
June 30, 2005) payable in monthly installments of interest only.
Of the former line with a bank $119,284 is outstanding, $17,927
was the June 30, 2005 total owed American Express.


                    Going Concern Doubt

Limelight Media Group has incurred a net loss of approximately
$161,000 in the six months ended June 30, 2005.  The Company's
current liabilities exceed its current assets by approximately
$2,128,000 as of June 30, 2005. The Company's net cash used from
operating activities approximated $35,000 during the six months
ended June 30, 2005.  These conditions give rise to substantial
doubt about the Company's ability to continue as a going concern.

The Company's management plan is to obtain additional financing
through a combination of equity and debt financing.  The ability
of the Company to continue as a going concern is dependent on
additional sources of capital and the success of the Company's
plan.

L.L. Bradford & Company, LLC also expressed substantial doubt
about the Company's ability to continue as a going concern when it
audited the Company's financial statements for the year ended
Dec. 31, 2004.

Headquartered in Seattle, Washington, Limelight Media Group, Inc.
(OTC Bulletin Board: LMMG) -- http://www.limelightmedia.com/and
http://www.impartinc.com/-- is a rapidly expanding digital
signage leader in the emerging out-of-home media sector, which is
beginning to take center stage with advertisers.  The company is
growing through a consolidation strategy that includes acquiring
the industries best and brightest talent and most advanced
solutions to create a broad, integrated one-stop communications
media company focused on digital signage and networked advertising
offerings for leading brands in industries such as retail,
grocery, banking, restaurants, hospitality, government and public
spaces, among others.  The company's digital media solutions
enable the simultaneous delivery of video content to a variety of
remote audiences in real time, allowing for immediate
customization of messages through a centralized network operations
center.

At June 30, 2005, Limelight Media Group, Inc.'s balance sheet
showed a $266,545 stockholders' deficit, compared to a $762,744
deficit at Mar. 31, 2004.


LIN TELEVISION: Moody's Rates $175 Million Sr. Sub. Notes at B1
---------------------------------------------------------------
Moody's Investors Service confirmed today the long term ratings of
LIN Television Corporation and concluded the review for possible
downgrade initiated on August 22, 2005.  Additionally, Moody's
assigned a B1 rating to the company's issuance of $175 million of
senior subordinated notes due 2015 and changed the outlook to
negative.  The proceeds from the transaction will be used to
reduce outstanding indebtedness under the company's existing bank
credit facilities.  Concurrent with this issuance, LIN announced
its intention to secure $500 million in bank financing, consisting
of a $250 million revolving credit facility and a $250 million
term loan to finance its asset acquisition from Emmis
Communications Corporation (five TV stations for $260 million with
cash).

The negative outlook reflects:

   * Moody's concern surrounding the potential return of cash to
     shareholders through the recently authorized $200 million
     share repurchase program instead of using excess cash flow
     for debt reduction;

   * Moody's expectation that leverage, (defined as total debt
     plus preferred to EBITDA) will exceed 6 times pro forma YE
     2005 and remain at or slightly above 6 times in the near to
     intermediate term; and

   * the uncertainty over the company's capital structure pro
     forma for the announced acquisitions.

Moody's confirmed these ratings:

   * Ba1 rating on the $330 million senior secured credit
     facilities;

   * B1 rating on the $375 million, 6.5% Senior Subordinated
     Debentures due 2013;

   * B1 rating on the Convertible Senior Subordinated Notes
     due 2033;

   * the SGL-2 Speculative Grade Liquidity rating; and

   * the Company's Ba2 Corporate Family Rating.

Moody's assigned this rating:

   * B1 rating to $175 million of senior subordinated notes
     due 2015.

The rating outlook is negative.

The ratings continue to reflect:

   * LIN's relatively high debt level ($1.2 billion pro forma for
     the acquisition and refinancing);

   * the company's strategy of growing through debt-financed
     acquisitions and the integration risk associated with this
     strategy;

   * the likelihood that the company will continue to expand into
     new and existing markets; and

   * the potential return of cash to shareholders through the
     recently authorized $200 million share repurchase program
     instead of using excess cash flow for debt reduction.

Further, the ratings incorporate risk posed by the intensely
competitive environment in which the company operates, as well as
Moody's concerns regarding the longer-term growth potential of
this sector as advertising spend is distributed over a growing
number of mediums (e.g. Internet, satellite radio, and Outdoor).

The ratings benefit from:

   * the company's stable cash flow;

   * a management team of proven operators; and

   * the substantial underlying perceived asset value in
     comparison to its debt burden.

The ratings also incorporate LIN's strong operating performance
relative to its peers, and continued strength in local news
programming, thereby generating a large proportion of more stable
local advertising.  To the extent that the company improves its
balance sheet, and successfully integrates its station assets in a
manner that exceeds Moody's expectations, a change in outlook
could occur.

LIN's SGL-2 rating reflects the company's "good" liquidity profile
as projected over the next four quarters.  Moody's notes that LIN
intends to use the proceeds from the company's recently announced
issuance of $175 million of senior subordinated notes to repay
outstandings under the existing credit facilities.  Further, LIN
announced its intention to secure $500 million in bank financing
to fund its $260 million asset acquisition from Emmis, consisting
of a $250 million revolving credit facility and a $250 million
term loan.

As such, Moody's expects LIN to have in excess of $200 million in
availability on its revolving credit facility providing the
company with significant cushion over the SGL time horizon.
Despite the off-year in terms of political and Olympic revenues,
Moody's estimates that LIN will continue to generate a meaningful
level of free cash flow during the full fiscal year 2005.
Additionally, capital expenditures are expected to remain at
maintenance levels going forward given that the company has
completed its digital conversion.  The liquidity rating is also
supported by the lack of any sizeable near term debt maturities.
Further, the SGL-2 rating acknowledges LIN TV's valuable portfolio
of television stations, which provide significant alternate
liquidity despite being encumbered by the secured bank agreement.

LIN TV Corp., headquartered in Providence, Rhode Island, pro forma
for the acquisition owns and operates 30 television stations in 14
markets.  In addition, the company also owns approximately 20% of
KXAS-TV in Dallas, Texas and KNSD-TV in San Diego, California
through a joint venture with NBC.  LIN TV is a 50% investor in
Banks Broadcasting, Inc., which owns KWCV-TV in Wichita, Kansas
and KNIN-TV in Boise, Idaho.


LIN TELEVISION: S&P Rates Proposed $175 Million Sub. Notes at B-
----------------------------------------------------------------
Standard & Poor's Ratings Services assigned its 'BB-' rating to
LIN Television Corp.'s proposed $500 million secured credit
facilities.  A recovery rating of '1' was also assigned to these
facilities, indicating high expectations of a full recovery (100%)
of principal in the event of a payment default.

At the same time, Standard & Poor's assigned a 'B-' rating to LIN
Television Corp.'s proposed $175 million subordinated notes due
2015.  Borrowings under the proposed credit facility and proceeds
from the expected notes offering are to be used to refinance the
company's existing credit agreement and to fund the $260 million
acquisition of five TV stations.  LIN Television Corp. is a wholly
owned subsidiary of LIN TV Corp.

The 'B+' long-term corporate credit rating on LIN TV was affirmed.
The outlook is stable.  TV operator LIN had approximately $718
million of debt outstanding on June 30, 2005.

The effect of the proposed transaction is to increase LIN's total
debt to EBITDA ratio by more than one turn, to the mid-6x area at
June 30, 2005, resulting from the debt-financed purchase of five
TV stations for $260 million.  This increase in leverage and the
potential for share repurchases given the company's recent
authorization were factored into the recent lowering of LIN's
corporate credit rating to 'B+' from 'BB-' on August 25, 2005.

"The rating on LIN reflects financial risk from debt-financed
expansion, ongoing acquisitions, and advertising cyclicality,"
said Standard & Poor's credit analyst Alyse Michaelson Kelly.
"These factors are only partially offset by LIN's competitive
positions in midsize TV markets, broadcasting's good margin and
free cash flow potential, and resilient station asset values."

LIN's portfolio comprises TV stations affiliated with the three
major broadcast networks, affording diversification against the
risks of individual network underperformance and local economic
cycles.  LIN operates a number of duopolies that provide cost
savings, revenue benefits, and a significant portion of broadcast
cash flow.

Revenue comparisons in 2005, a non-election year, will be
difficult because of the absence of the sizable political ad
dollars that provide a lift in even-numbered years.  Auto
advertising, which has been regionally spotty, will be a key
driver of operating performance in 2005.


LSP-KENDALL ENERGY: Moody's Rates $422 Million Facilities at B1
---------------------------------------------------------------
Moody's Investors Service assigned a B1 rating to LSP-Kendall
Energy, LLC's proposed $422 million senior secured credit
facilities consisting of a $412 million term loan facility due in
2013 and a $10 million revolving credit facility expiring in 2011.
The rating outlook is stable.

Proceeds from the proposed term loan facility combined with a $30
million equity contribution from the sponsor and cash on hand will
be used to repay approximately $441 million of existing recourse
debt and various transaction costs and expenses.

The B1 rating considers the stable cash flow expected to be
generated through existing tolling arrangements with Dynegy Power
Marketing, Inc. (DPM) for electricity generating capacity provided
from Kendall's units one and two through the first quarter of 2017
and Constellation Energy Commodities Group, Inc. (CECG) for
capacity provided by unit three through September 2017.  The
majority of payments under the tolling arrangements are
insensitive to dispatch of the generating units.

The obligations of DPM and CECG are supported by irrevocable and
unconditional payment guarantees from:

   * Dynegy Holdings, Inc. (DHI: Caa2 senior unsecured, under
     review for possible upgrade), and

   * Constellation Energy Group, Inc. (Constellation: Baa1 senior
     unsecured, stable outlook), respectively.

The B1 rating also reflects an existing back-to-back power
purchase agreement between DPM and CECG.  Under this structure,
DPM agreed to pay CECG $117 million to assume the fixed
obligations under its tolling arrangement with Kendall through
November 2008.  During the term, CECG will control the dispatch of
units one and two and will be responsible for paying DPM monthly
amounts that are nearly identical to the amounts that DPM owes
Kendall.  Termination by DPM of the Kendall tolling arrangement
for any reason would result in the immediate termination of the
back-to-back agreement.

Kendall's fourth turbine unit has been left uncontracted to
satisfy contractual obligations should the contracted units be out
of service, and to earn additional margin by selling capacity and
energy into the local power market.

Limiting factors for the rating include:

   * Kendall's reliance on DHI for approximately two-thirds of its
     contracted cash flow after expiration of the back-to-back
     agreement;

   * the modest amount of contractual cash flow relative to pro-
     forma leverage; and

   * the reliance on cash flow from the sale of Kendall's
     uncontracted energy and capacity to reduce and refinance an
     expected bullet payment in 2013.

While Kendall's base case financial forecast model shows a
refinancing need of less than $100 million in 2013, the actual
size of refinancing will largely be determined by the market
prices for the sale of Kendall's uncontracted capacity and energy.
The issuer's base case assumes improvement in the merchant power
market for gas fired plants, which are currently affected by
oversupply and high natural gas prices.

As an illustration of the reliance upon merchant revenue, if
Kendall's cash flow was assumed to hold constant at the most
recent trailing twelve month level, thereby not taking into
account annual inflation adjustments in the tolling arrangement,
the refinancing need would be estimated at approximately $335
million in 2013.  The rating incorporates an expectation that
there will be some improvement in market conditions over the
period of the financing but recognizes that the timing and degree
of recovery are uncertain.

Kendall generated cash available for debt service (defined as cash
from operations plus interest expense less capital expenditures)
of approximately $38 million in 2004 and $39 million for the
twelve months ended June 30, 2005 (which excludes a $4.1M non-
recurring fee).  These amounts include $2.5 million and $4.0
million, respectively, of margin contributions generated through
the sale of merchant energy and capacity.

In assigning the rating, Moody's also considered structural
features in the term loan agreement, including:

   * a 100% cash sweep of excess cash flow with proceeds to be
     used for debt repayments above the scheduled amortization of
     1% per annum;

   * a $20 million debt service reserve to be funded with a
     sponsor-provided letter of credit; and

   * a $10 million revolving credit facility that could be used to
     make mandatory debt service payments in the event that the
     debt service reserve is exhausted.

The $20 million debt service reserve represents approximately 7
months of projected debt service in 2006.  The debt service
reserve requirement remains at $20 million until the ratio of debt
to EBITDA is less than 5 times, at which time the required debt
service reserve would be reduced to an amount equal to 6 months of
debt service.

The stable outlook reflects the contractual nature of Kendall's
cash flows and near-term mitigation of DHI credit risk through the
back-to-back agreement.  Positive trends that could lead Moody's
to consider an upgrade would include a rating upgrade of DHI's
senior unsecured rating to B1 combined with better than expected
cash flow on a sustainable basis such that the ratio of cash flow
from operating activities (defined as cash available for debt
service less interest expense) to debt would be about 10%.  The
ratio of cash flow from operating activities in 2006 to
outstanding debt at year end is projected to be about 4%.

Trends that could lead Moody's to consider a downgrade of the
rating would include substantial deterioration in the tolling
counterparties' credit profile or operational difficulties that
negatively impact Kendall's cash flows, resulting in a ratio of
cash from operating activities to funded debt of less than 3%.

The rating is predicated upon the expectation that final
documentation will be consistent with Moody's current
understanding of the transaction structure.

Kendall is a four-unit 1,160 megawatt natural gas-fired combined
cycle power plant located 30 miles southwest of Chicago.  It
operates within the ComEd region of PJM and is wholly-owned by LS
Power Associates, L.P.


MAGNUM HUNTER: Moody's Upgrades Sr. Unsec. Notes' Rating to Ba3
---------------------------------------------------------------
Moody's assigned a Ba3 Corporate Family Rating to Cimarex Energy
Company, upgraded its Magnum Hunter (MHR) senior unsecured notes
to Ba3 from B2, and withdrew MHR's B1 Corporate Family Rating.
MHR's ratings had been under review for upgrade since the
announcement of the $2.2 billion acquisition of MHR by Cimarex.
The rating outlook is stable.

Debt free Cimarex assumed $634 million of MHR debt and capital
leases at the closing ($573 million as of June 30, 2005 and now
approximately $500 million) and issued 39.7 million common shares
in exchange for all MHR common stock.  The acquisition doubled
Cimarex' production and tripled its reserves.  All MHR debt now
resides at parent Cimarex.  Cimarex reports that essentially all
pro-forma reserves and production are held at the Cimarex level
and at subsidiaries guaranteeing the MHR notes.

Founded in 1992 by Mr. F. H. Merelli as Key Production Company,
Cimarex is the product a 2002 merger with Helmerich and Paynes's
upstream division, changing Key's name to Cimarex.  Mr. Merelli,
Cimarex' CEO, was the driving force and surviving chief executive
of both the Helmerich and MHR mergers.  Cimarex is an exploration
and production company with core properties located in:

   * the Mid-continent (38% of reserves; 37% of production);
   * Permian Basin (45%; 27%);
   * Gulf Coast (9%; 19%); and
   * the Gulf of Mexico (6%; 15%).

MHR added important scale, diversification, basin intensification,
and a longer reserve life to Cimarex' portfolio.  MHR's longer
lived Mid-continent reserves intensified Cimarex' existing core
holdings there and MHR's Permian Basin properties added an
important new core area of operations, with MHR's Southeast New
Mexico properties (Permian) central to Cimarex' interest in MHR.
Moody's is less enthusiastic with Cimarex' new presence in the
very short lived, very capital intensive, offshore Gulf of Mexico
region.

The removal of the notch between the senior note rating and the
Corporate Family Rating results in the two notch upgrade of the
notes.  The de-notching of the notes reflects Moody's current view
that Cimarex is likely to complete full repayment of its remaining
secured debt with proceeds from modest additional asset sales and
cash flow and Moody's view that Cimarex is likely to steer towards
its historic preference for sustained low leverage as it repays
its acquisition debt.  Moody's believe Cimarex' historic penchant
for lower leverage is prone to further materially reduce secured
debt near-term.

The notes would be re-notched if it appears that Cimarex'
accelerating internal capital budget and/or new acquisitions and
related funding begin to indicate sustained material borrowings
under its $500 million secured borrowing base bank revolver.
Since the second quarter 2005 closing and assumption of $270
million of bank debt, Cimarex reduced secured bank debt to $138
million with cash on hand, cash flow from operations, and the
proceeds of its initial divestiture (royalty interests).

Ratings support derives importantly from Moody's view that:

   * Cimarex is likely to hew to its long-standing low leverage
     strategy and culture;

   * focus over the next twelve months likely to be on assessing
     and re-ranking its post-acquisition project priorities; and

   * benefit from the flexibility provided by a longer lived,
     larger, more diversified proven developed (PD) reserve base.

Cimarex has also followed conservative reserve booking practices
in the past for proven undeveloped reserves, with its much larger
post-acquisition PUD position being inherited from MHR.  Cimarex
also reported at the time that it would likely chose to not book
all of MHR's PUD reserves.  Further support comes from Cimarex'
past practice of funding corporate acquisitions with all-stock
exchanges of common equity, though, as in MHR, the target may come
with material existing debt.

The ratings are partly restrained by Moody's view that during
Cimarex digestion period, it may take as long as a year or more to
determine if Cimarex' organic activity will consistently offset,
on a sequential quarter basis, its now much larger 34% proportion
of quick-decline Gulf Coast and Gulf of Mexico production.  Still,
while Moody's expects that the steep decline curves of those
properties will put a flat-to-down bias on production over the
next twelve months, Moody's also expects that capital spending
will be covered by flush up-cycle pre-capex cash flow.
Furthermore, the longer lived and, to a degree, lower risk Mid-
continent and Permian properties provide important risk
diversification balance to the relatively higher risk Gulf Coast
and Gulf of Mexico properties.

Ratings support is also seen in Moody's expectation of a:

   * post-acquisition inward focus on portfolio rationalization;
   * prospect evaluation and ranking; and
   * quick secured debt quick reduction.

Moody's anticipates divestitures in the range of $60 million
(already completed) to as much as $100 million, with proceeds used
to reduce debt.  Moody's expects that Cimarex will move quickly to
rank and exploit its substantially larger inventory of production
enhancement projects, take longer to evaluate its West Texas and
Gulf of Mexico prospects, and continue its tradition of internally
developed drilling prospects.

Specifically, the ratings are supported by:

   * substantial PD reserve scale;

   * a reasonably supportive PD reserve life of 6.6 years;

   * currently low leverage as measured by a comparatively low
     $2.45/BOE of Adjusted Debt per BOE of PD reserves;

   * important core holdings in the Mid-continent and
     Permian Basin;

   * intensified and added diversification of its core Gulf Coast
     holdings; and

   * internal capital allocation flexibility provide by the new
     fourth core holding of the Gulf of Mexico.

While the Gulf Coast and Gulf of Mexico holdings have inherently
short reserve lives, they add internal flexibility for the high
grading of drilling activity in a range of price environments.

The short-lived Gulf Coast and Gulf of Mexico holdings together
comprise 15% of reserves, 34% of production, and 50% of the 2005
and expected 2006 pro-forma capital budgets.  Importantly, the
high level of capital devoted to those holdings may not be very
credit accretive, especially if their proportion grows materially
in Cimarex' base.

The ratings are also restrained by Cimarex' high reserve
replacement costs, partly due to its strategy of pursuing fast
payout activity suitable to high price environments.  The
resulting short reserve lives and especially high reserve
replacement costs have so far been comfortably covered in recent
and expect price environments.  However, this strategy also
requires lower leverage than otherwise might be required by the
ratings.  It also remains to be seen how Cimarex' prospect
inventory can be managed to deliver lower reserve replacement
costs suitable to lower price environments.

Based on Cimarex' more conservative estimates of MHR reserves, it
paid $14/boe or $2.33/mcfe for MHR's reserves and approximately
$48,000/boe of daily MHR production.  The merged firm holds
approximately 233.5 mmboe of proven reserves, of which 191.3 mmboe
(82% of reserves) would be proven developed reserves.  Cimarex' PD
reserve life had been a comparatively short 5.2 years while MHR's
has been approximately 8.5 years.  The merged firm still has a
below average proven developed reserve life of approximately 6.6
years.

Cimarex' full-cycle costs are high, in the range of $29/BOE
(including capitalized G&A and capitalized interest), principally
reflecting its very high pro-forma three year average all-sources
finding and development costs of roughly $16.40/BOE.  While
Cimarex states that its high reserve replacement costs (over
$16/BOE before MHR) are partly due to its prospect selection
during a historically high price environment, it will be important
for those costs to moderate down when oil and gas prices moderate.

Moody's anticipates approximately $725 million to $750 million of
actual 2005 EBITDA, amply supporting actual capital spending and
interest expense.  In 2006, Moody's anticipates in the range of
$775 million to $850 million, due to moderating oil and gas prices
and flat-to-down production relative to current post-merger daily
production.  Moody's anticipates 2006 capital spending in the
range of $700 million to $800 million, depending on Cimarex' cash
flow expectations at the time, and interest expense in the range
of $30 million to $40 million (including capitalized interest),
depending on the degree of further debt reduction.

Cimarex Energy Co. is headquartered in Denver Colorado.


MAYTAG CORP: Moody's Lowers Senior Unsecured Debt Rating to B2
--------------------------------------------------------------
Moody's Investors Service lowered the debt ratings of Maytag
Corp., while maintaining the ratings on review with "direction
uncertain".  The corporate family rating and bank facility rating
have been lowered to B1 from Ba2 and the senior unsecured notes
have been lowered to B2 from Ba2.

The action follows Maytag's recent lowering of near-term financial
guidance due to a combination of cost increases and unfavorable
product and pricing mix as well as the subordination impact on the
senior notes arising from the proposed new secured credit
facility.  The company cited known challenges to its cost
structure, including high fixed costs and excess manufacturing
capacity, as well as more recent issues such as increased
distribution expenses and raw material costs.

In addition, Maytag indicated that it would complete its recently
negotiated $600 million secured revolving credit facility, which
is not rated by Moody's.  The new facility will replace Maytag's
current credit facility in the fourth quarter of 2005.  While the
company is continuing to move toward its goal of being acquired by
Whirlpool, it does not expect to complete the merger prior to the
first quarter of 2006.

The rating of Maytag's bonds are being dropped one notch below the
company's corporate family rating.  The new credit facility will
be secured by Maytag's accounts receivable and inventory of
certain subsidiaries, which will subordinate Maytag's senior
unsecured debt to a potentially substantial amount of secured
borrowings.  This will reduce bondholders' priority of claim to
Maytag's more liquid assets in a distressed scenario.  The current
credit facility remains at the same level as the corporate family
rating; it will be cancelled concurrent with the activation of the
new secured facility.

Maytag's ratings remain on review with direction uncertain.  A
successful takeover by Whirlpool (Baa2 on review for possible
downgrade) could improve Maytag's ratings if Whirlpool assumes the
debt or if the acquisition provides other value to bondholders.
Maytag's ratings could remain at current levels or fall further if
the bonds are further subordinated in the capital structure, if
the merger is not completed or if completion becomes highly
unlikely, or if the company's performance and financial condition
show further deterioration.

These ratings were affected by this action:

   * Corporate family rating lowered to B1 from Ba2

   * Senior unsecured notes ratings lowered to B2 from Ba2

   * Senior unsecured credit facility rating lowered to B1
     from Ba2

The ratings are on review with direction uncertain.

Maytag, based in Newton, Iowa is the third largest US-based
appliance company.  For the fiscal year ended January 1, 2005 the
company reported total revenues of approximately $4.7 billion.


MCI INC: Completes Acquisition of Totality Corp.
------------------------------------------------
MCI, Inc., (NASDAQ: MCIP) reported the completion of its
acquisition of Totality Corp., a privately held, San Francisco-
based provider of remote managed services for business-critical
applications and infrastructure.

This acquisition, a significant step toward expanding MCI's
managed services capabilities, enables MCI to satisfy the growing
demand from its enterprise and government customers to manage a
wider array of IT functions end-to-end.  With the addition of
Totality, MCI is enabling the remote monitoring and management of
applications whether they are hosted at MCI's colocation centers
or at customer locations, further extending MCI's managed hosting
portfolio.  MCI will now be able to offer its customers more
flexible hosting options ranging from colocation services to
Enterprise Hosting services to outsourcing of application
management services.

"As more businesses and governments transition to IP, they are
looking for higher-value services that help them better manage
their IP infrastructure," said Jonathan Crane, MCI executive vice
president and chief strategy officer.  "This acquisition enables
MCI to provide more fully integrated solutions from the networking
to the application layer with the performance and reliability
customers have come to expect from MCI."

Headquartered in Clinton, Mississippi, WorldCom, Inc., now known
as MCI -- http://www.worldcom.com/-- is a pre-eminent global
communications provider, operating in more than 65 countries and
maintaining one of the most expansive IP networks in the world.
The Company filed for chapter 11 protection on July 21, 2002
(Bankr. S.D.N.Y. Case No. 02-13532).  On March 31, 2002, the
Debtors listed $103,803,000,000 in assets and $45,897,000,000 in
debts.  The Bankruptcy Court confirmed WorldCom's Plan on
October 31, 2003, and on April 20, 2004, the company formally
emerged from U.S. Chapter 11 protection as MCI, Inc. (WorldCom
Bankruptcy News, Issue No. 101; Bankruptcy Creditors' Service,
Inc., 215/945-7000)

                         *     *     *

As reported in the Troubled Company Reporter on Feb. 22, 2005,
Standard & Poor's Ratings Services placed its ratings of Ashburn,
Virginia-based MCI Corp., including the 'B+' corporate credit
rating, on CreditWatch with positive implications.  The action
affects approximately $6 billion of MCI debt.


MCI INC: D.E. Shaw to Vote Against MCI-Verizon Merger on Oct. 6
---------------------------------------------------------------
The D. E. Shaw group reported its intention to vote its 10,135,319
million shares of MCI, Inc. (Nasdaq:MCIP) common stock against the
company's proposed merger with Verizon Communications Inc.
(NYSE:VZ).  The proposed merger will be the subject of a special
vote at a meeting of MCI stockholders scheduled for October 6,
2005.

D. E. Shaw & Co., L.P. believes that the current transaction
undervalues MCI and is inadequate given the offers MCI has
previously received and rejected.

                           About D.E. Shaw

Headquartered in New York, the D. E. Shaw group is a specialized
investment and technology development firm whose activities center
on various aspects of the intersection between technology and
finance.  With approximately $17 billion in aggregate capital, the
D. E. Shaw group is a recognized leaderin the alternative
investment management arena and was recently named "Best
Alternative Investment House" by Euromoney magazine.

Headquartered in Clinton, Mississippi, WorldCom, Inc., now known
as MCI -- http://www.worldcom.com/-- is a pre-eminent global
communications provider, operating in more than 65 countries and
maintaining one of the most expansive IP networks in the world.
The Company filed for chapter 11 protection on July 21, 2002
(Bankr. S.D.N.Y. Case No. 02-13532).  On March 31, 2002, the
Debtors listed $103,803,000,000 in assets and $45,897,000,000 in
debts.  The Bankruptcy Court confirmed WorldCom's Plan on
October 31, 2003, and on April 20, 2004, the company formally
emerged from U.S. Chapter 11 protection as MCI, Inc. (WorldCom
Bankruptcy News, Issue No. 101; Bankruptcy Creditors' Service,
Inc., 215/945-7000)

                         *     *     *

As reported in the Troubled Company Reporter on Feb. 22, 2005,
Standard & Poor's Ratings Services placed its ratings of Ashburn,
Virginia-based MCI Corp., including the 'B+' corporate credit
rating, on CreditWatch with positive implications.  The action
affects approximately $6 billion of MCI debt.


METALLURG INC: Issuing $167.5 Million of New Senior Secured Notes
----------------------------------------------------------------
Metallurg, Inc., along with:

   * its parent company, Metallurg Holdings, Inc., as co-issuer;

   * Metallurg Inc.'s subsidiaries:

     -- Shieldalloy Metallurgical Corporation, as co-issuer; and
     -- Metallurg Holdings Corporation, as guarantor

entered into a Purchase Agreement with Jefferies & Company, Inc.,
relating to the Company's offer and sale in a Rule 144A
transaction of an aggregate principal amount of $117.5 million of
their 10-1/2% Senior Secured Class A Notes due 2010.

The sale of the Class A Notes is subject to customary closing
conditions and expected to close on September 29, 2005.  The
Purchase Agreement contains representations and warranties and
conditions precedent that are customary for transactions of this
type.  In the Purchase Agreement, the Issuers and the Guarantor
have agreed to indemnify the Initial Purchaser against liabilities
arising from the transactions under the Purchase Agreement,
including liabilities arising under the Securities Act of 1933 and
the Securities Exchange Act of 1934.

Concurrent with its entry into the Purchase Agreement, the Company
expects to issue $50 million of Senior Secured Class B Notes and
to enter into a new credit facility.  The Company expects to use
the proceeds of the Class A Notes and the Class B Notes to repay
all of its outstanding domestic indebtedness.

Metallurg, Inc., headquartered in New York City, is a leading
international producer of high quality metal alloys and specialty
metals used by manufacturers of steel, aluminum, superalloys,
chemicals, and other metal consuming industries.

                         *     *     *

As reported in the Troubled Company Reporter on June 13, 2005,
Moody's Investors Service raised the ratings of Metallurg, Inc.
and its parent Metallurg Holdings, Inc.

These ratings were upgraded:

  Metallurg Holdings, Inc.:

   * senior implied rating, to Caa1 from Caa3;

   * $40.3 million of 12.75% senior discount notes, Series B, due
     July 15, 2008, to Ca from C; and

   * issuer rating, to Ca from C.

  Metallurg, Inc.:

   * $100 million of 11% guaranteed senior notes, Series B, due
     Dec. 1, 2007, to Caa2 from Ca.


MIRANT CORP: Disclosure Statement Hearing Slated for Tomorrow
-------------------------------------------------------------
Judge Lynn of the U.S. Bankruptcy Court for the Northern District
of Texas will convene a hearing today, Sept. 27, 2005, at 9:00
a.m. Central time;

       -- to determine whether objections relating to the
          confirmability of Mirant Corporation and its debtor-
          affiliates' proposed plan of reorganization, rather than
          the adequacy of the Disclosure Statement, should be
          heard in connection with the Disclosure Statement
          Hearing or continued to a later date; and

       -- pertaining to any objections that may be decided as a
          matter of law only and do not require the parties to
          solicit testimony or introduce evidence.

The hearing on the Debtors' Solicitation Procedures Motion dated
April 20, 2005, will convene on Sept. 28, at 9:00 a.m.  Telephonic
participation will be permitted during the hearing.

The Disclosure Statement Hearing will convene on Sept. 28, 2005,
at 9:00 a.m. (CDT).  The Court will hear arguments and the
presentation of evidence pertaining to any Objections that cannot
be decided as a matter of law.  Telephonic participation will not
be permitted during this phase of the Hearing except in "listen
only" mode.

To aid the Court in allocating the Disclosure Statement Hearing
among the various issues, Judge Lynn directs the Examiner to
present to the Court a brief list of the remaining issues to be
resolved in connection with the determination of the adequacy of
the Disclosure Statement and time estimates for each of the
issues.

To aid the Examiner in the compilation of the information, Judge
Lynn directs the Debtors and the Objecting Parties to coordinate
with the Examiner and his counsel in identifying outstanding
issues and proposed time estimates.

As reported in the Troubled Company Reporter on Sept. 23, 2005,
the Debtors filed its Second Amended Plan of Reorganization and
Disclosure Statement with the Court.

The complete Amended Plan of Reorganization is available for free
at http://ResearchArchives.com/t/s?1c7

The complete Amended Disclosure Statement is available for free at
http://ResearchArchives.com/t/s?1c8

Headquartered in Atlanta, Georgia, Mirant Corporation --
http://www.mirant.com/-- is a competitive energy company that
produces and sells electricity in North America, the Caribbean,
and the Philippines.  Mirant owns or leases more than 18,000
megawatts of electric generating capacity globally.  Mirant
Corporation filed for chapter 11 protection on July 14, 2003
(Bankr. N.D. Tex. 03-46590).  Thomas E. Lauria, Esq., at White &
Case LLP, represents the Debtors in their restructuring efforts.
When the Debtors filed for protection from their creditors, they
listed $20,574,000,000 in assets and $11,401,000,000 in debts.
(Mirant Bankruptcy News, Issue No. 77; Bankruptcy Creditors'
Service, Inc., 215/945-7000)


MIRANT CORP: Southern Co. Wants $2BB Suit Transferred to Georgia
----------------------------------------------------------------
Mirant Corporation and its debtor-affiliates and the Official
Committee of Unsecured Creditors of Mirant Corporation amended
their $2 billion lawsuit against Southern Co. et al. to reflect
non-material modifications.

A full-text copy of Mirant's Amended Complaint is available for
free at http://bankrupt.com/misc/AmendedComplaint.pdf

               Southern Wants the Reference Withdrawn

Gregory M. Gordon, Esq., at Jones Day, in Dallas, Texas, tells
the U.S. Bankruptcy Court for the Northern District of Texas that
Southern Co. wants to transfer the venue of the Southern Action to
a court in Atlanta, Georgia, and consolidate it with a lawsuit
filed by Mirant against its former directors and officers.

Accordingly, Southern asks the U.S. District Court for the
Northern District of Texas to withdraw the reference of the
Southern Action from the Bankruptcy Court.

Mr. Gordon explains that in deciding whether there is "cause" to
withdraw the reference, a court should consider seven factors:

    (a) Whether the matter involves core, non-core or mixed
        issues;

    (b) Whether or not there has been a jury demand;

    (c) The effect of withdrawal on judicial efficiency;

    (d) Reduction in forum shopping;

    (e) Uniformity in bankruptcy administration;

    (f) Fostering the economical use of the Debtor's and
        creditor's resources; and

    (g) Expediting the bankruptcy process.

"The substantive causes of action contained in the Adversary
Complaint include both core and non-core claims," Mr. Gordon
asserts.  A proceeding is core only if "it invokes a substantive
right provided by [the Bankruptcy Code] or if it is a proceeding
that, by its nature, could arise only in the context of a
bankruptcy case."

Many of the claims asserted in the Adversary Complaint are
clearly non-core, Mr. Gordon says, including claims for damages
for aiding and abetting breach of certain fiduciary duties;
illegal dividend claim; and alter ego claim.

Because the Complaint contains substantial non-core actions, Mr.
Gordon contends, it would be more efficient for the Georgia
District Court to decide all of the causes of actions rather than
having the Bankruptcy Court issue a final decision on the core
issues and submit proposed findings of fact and conclusions of
law on the non-core issues.

Mr. Gordon asserts that Southern is entitled to a jury trial for
many of the claims asserted against it under the standards set
forth in Granfinanciera v. Nordberg, 492 U.S. 33 (1989).  The
Supreme Court has made it clear that a person is entitled to a
jury trial with respect to a fraudulent conveyance action, Mr.
Gordon adds.  "The Seventh Amendment [also] entitles a person to
a jury trial on a breach of fiduciary duty claim and an illegal
dividend claim."

Moreover, Southern has not waived its right to a jury trial by
filing the Southern Claims, Mr. Gordon points out.  "Any argument
by the Mirant Debtors and the Committee to the contrary would be
misguided."

Mr. Gordon maintains that withdrawal of the reference would
foster judicial economy.  "It is well established that where
there is a pending district court action that shares common
issues of fact with an action in a bankruptcy court, the
reference should be withdrawn so that the matters can be
consolidated."

According to Mr. Gordon, the D&O Action is based on the same
operative facts as the Adversary Proceeding.  Similarly, the
Director Defendants has filed a motion to withdraw the reference
of the D&O Action, Mr. Gordon relates.  Notably, In re Mirant
Corporation Securities Litigation, Civil Action No. 1:02-CV-1467-
RWS (N.D. Ga.), which involves many of the same parties and
potentially overlapping discovery with the Adversary Proceeding
and the D&O Action, is pending before the Georgia District Court,
Mr. Gordon adds.

"By withdrawing the reference of the Adversary Proceeding, the
[Texas District Court] would be able to transfer the Adversary
Proceeding and the D&O Action to the Georgia District Court.  The
Georgia District Court would then be able to determine the most
efficient way for one or more trials to proceed on the common
issues of fact.  That Court could also coordinate discovery,
which would reduce the burden on the courts, the parties (and
non-party witnesses) and enable each party to litigate fully and
fairly its case without unnecessary collateral litigation," Mr.
Gordon emphasizes.

Mr. Gordon tells the Court that the parties in the Actions
substantially overlap and there is considerable risk of
duplication of effort and inconsistent results.  "[I]t is far
more efficient to have one court supervise discovery and pretrial
proceedings," Mr. Gordon asserts.

Southern is not engaging in forum shopping, Mr. Gordon contends.
"Southern's aim is to have the Adversary Proceeding tried in
Georgia District Court, the forum whose law applies to many of
the claims, where the underlying transactions occurred, where the
vast majority of witnesses and evidentiary proof reside, and
where related litigation has been pending."

                 Transfer & Consolidation of Action

Southern also asks the District Court to:

    a. transfer the Southern Action to the United States District
       Court for the Northern District of Georgia, Atlanta
       Division; and

    b. consolidate the Southern Action with the D&O Action
       captioned as Official Committee of Unsecured Creditors of
       Mirant Corp., et al. v. Elmer B. Harris, et al., Adv. Pro.
       No. 05-04146 (DML).

Mr. Gordon says that the Actions contain both common issues of
fact and law.  "Both cases involve the same plaintiff-creditors,
who are suing on behalf of the same debtors, over nearly
identical questions of fact and common questions of law."

Mr. Gordon adds that consolidation will:

    -- reduce the costs, time, and convenience inherent in
       litigating parallel actions;

    -- eliminate the need for redundant trials in which identical
       evidence and witnesses will be presented; and

    -- conserve judicial resources by avoiding duplicate hearings,
       motions and trials.

According to Mr. Gordon, the Southern Action arises from
decisions made in Atlanta by witnesses who mainly live or work
there, and where the vast majority of relevant documents are
maintained.  "Indeed, Mirant itself successfully moved to
transfer securities litigation pending against it in California
to the Northern District of Georgia on the grounds that the vast
majority of its relevant documents and witnesses were in
Atlanta."

By contrast, Mr. Gordon points out that Mirant does not allege
that:

    -- any of the operative facts occurred in Texas;
    -- Texas law applies to any of their claims; or
    -- Texas has any connection to the dispute.

"The interests of justice as well as the convenience of the
parties and witnesses strongly weigh in favor of transferring the
case to Atlanta," Mr. Gordon asserts.

On August 9, 2005, the Mirant Committee filed a motion to dismiss
the D&O Action as a matter of right.

             Mirant Opposes Withdrawal of the Reference

Robin E. Phelan, Esq., at Haynes and Boone, LLP, in Dallas,
Texas, asserts that because of the Mirant Committee's request to
dismiss the D&O Action, there is no longer any need to consider
the consolidation or any related issues.

Mr. Phelan points out that the matter is a core proceeding, and
for which there is no right to trial by jury.  "Southern cannot
recast [the] case as anything other than a proceeding that
directly and unquestionably affects the Debtors' restructuring
and the debtor-creditor relationship, and for which there is no
right to trial by jury."

Each of the causes of action asserted against Southern in the
Amended Complaint is a core matter, Mr. Phelan asserts.  "They
are inextricably intertwined with the same transaction that forms
the basis of Southern's proofs of claim and [Mirant's] objections
thereto . . . and directly impact the claims allowance process."

Aside from the fact that the Amended Complaint objects to
Southern's claims, all causes of action asserted either sound in
equity, seek an equitable remedy, or affect the claims allowance
process and the priority of creditors' claims, Mr. Phelan adds.

                     Southern Answers Complaint

Mirant's financial problems resulted from an industry crisis that
was sparked by the unforeseen "perfect storm" of the tragic
events of September 11, 2001, a U.S. and global economic
recession and the collapse of Enron Corporation, Mr. Gordon tells
the Court.  "While Mirant and its creditors would like to rewrite
history, the facts demonstrate that Southern was in no way
responsible for Mirant's financial problems or bankruptcy."

According to Mr. Gordon, Mirant's financial problems arose after
its independence from Southern and after Mirant was frustrated in
its attempt to pursue a rapid growth strategy in the wake of an
industry crisis that devastated Mirant's credit ratings and
business model.

Mr. Gordon points out that the facts stated in the Debtors'
"First Day Affidavit" filed at the commencement of their Chapter
11 proceedings refute the allegations of the Amended Complaint.
In the Affidavit, the Mirant Debtors attributed their financial
plight to:

    (1) a financial crisis in the U.S. power industry;
    (2) Enron's bankruptcy in December 2001; and
    (3) the downgrading of Mirant's credit rating.

"Mirant's testimony nowhere implicates Southern as a factor
leading to Mirant's current financial troubles," Mr. Gordon says.
"Mirant's Annual Report to Shareholders for 2001 supported this
testimony."

Mr. Gordon disagrees with Mirant's allegations that it was
insolvent at the time of the alleged Transfers under various
transactions.  At all relevant times during 1999 through 2001,
Mr. Gordon relates that the three major credit rating agencies --
Standard & Poor's Rating Services, Moody's Investor Service and
Fitch Ratings -- rated Mirant, Mirant Americas Generation, LLC
and Mirant Americas Energy Marketing, LP, as having investment
grade credit.  "These ratings resulted from rigorous scrutiny by
the credit rating agencies of these companies' respective
financial conditions, capitalization and prospects.  Their
investment grade credit ratings were confirmed prior to the IPO
after the rating agencies had reviewed the details of the IPO and
the Spin-Off, including the dividends, loan repayments and
transfer of subsidiaries."

Following the Spin-Off, Mirant and its subsidiaries continued to
engage in a business strategy of rapid growth through acquisition
and construction of new projects, Mr. Gordon points out.
"[B]anks and other lenders were willing to lend billions of
dollars in new debt to Mirant and its subsidiaries between the
Spin-Off and their chapter 11 filing."

Mr. Gordon insists that Southern acted properly and lawfully as
the corporate parent and as a majority shareholder of Mirant
through the initial public offering of Mirant's common stock in
2000 and the spin-off of Mirant shares to Southern shareholders
effective on April 2, 2001. "The overall divestiture was
formulated and executed with Mirant's active participation, was
in all respects fair to Mirant and was subjected to intense
public, regulatory and creditor scrutiny."

Southern denies Mirant's allegations in relation to fraudulent
conveyances or transfers, advances as equity, Mirant as the alter
ego of Southern, breach of fiduciary duty, objection to
Southern's claims, and equitable subordination of Southern's
claims.

Southern asserts that:

    a. the reference should be withdrawn to the United States
       District Court for the Northern District of Texas;

    b. the Bankruptcy Court and the Texas District Court are not
       the proper venues for the Southern Action;

    c. Mirant's Amended Complaint fails to state a claim on which
       relief can be granted;

    d. some or all of Mirant's claims in the Amended Complaint are
       barred:

       * by the applicable statute of limitations or repose;

       * by the doctrines of waiver, unclean hands, laches and
         estoppel, accord and satisfaction, and set-off; and

       * due to release; and

    e. Mirant lacks standing as to one or more of the claims.

Southern also asserts that Mirant's claim for punitive damages
should be dismissed because it violates the constitutional
clauses of Excessive Fines and Due Process, the applicable law
for punitive damages and Southern's equal protection rights.

Thus, Southern asks the Court:

     (i) to rule in its favor whereby Mirant recovers nothing, and
         for Mirant to bear all costs and expenses: and

    (ii) for a trial by jury.

Headquartered in Atlanta, Georgia, Mirant Corporation --
http://www.mirant.com/-- is a competitive energy company that
produces and sells electricity in North America, the Caribbean,
and the Philippines.  Mirant owns or leases more than 18,000
megawatts of electric generating capacity globally.  Mirant
Corporation filed for chapter 11 protection on July 14, 2003
(Bankr. N.D. Tex. 03-46590).  Thomas E. Lauria, Esq., at White &
Case LLP, represents the Debtors in their restructuring efforts.
When the Debtors filed for protection from their creditors, they
listed $20,574,000,000 in assets and $11,401,000,000 in debts.
(Mirant Bankruptcy News, Issue No. 75; Bankruptcy Creditors'
Service, Inc., 215/945-7000)


MIRANT CORP: Restarts Potomac River Plant Unit 1 After Filing Plan
------------------------------------------------------------------
Mirant Corporation's Potomac River Generating Station Unit 1
temporarily went back to operation as of Sep. 21, 2005, after the
Company filed a plan with the Virginia Department of Environmental
Quality (DEQ).

By using the same modeling protocol approved by the DEQ, but
with inputs that reflect more realistic operating conditions,
Mirant will operate Unit 1 with ambient air concentrations that
are better than the National Ambient Air Quality Standards
(NAAQS) for sulfur dioxide, particulate matter 10 and oxides of
nitrogen.  The plan ensures protection of human health and the
environment surrounding the plant.

Mirant notes that prior to shutting down the plant, its
stack emissions complied with Environmental Protection Agency
operating permit emission limits.

Mirant's plan calls for operating Potomac River Unit 1 up to
16 hours a day, including approximately eight hours at maximum
load (88 MW), approximately eight hours at minimum load (35 MW),
and eight hours of shutdown.  At full operation, the plant
produces 482 MW.

"This step is consistent with our goal to return the plant
to service, protect public health and support the region's
electric reliability," said Lisa D. Johnson, president of
Mirant's Northeast and Mid-Atlantic business unit.

The plan is based on modeling that employs the same
meteorological data and air measurement locations used in the
August 2005 report prepared by ENSR International, the same
company approved by DEQ to do the August 2005 modeling study.

However, certain changes were made to reflect more realistic
operating conditions, including:

      * Removing Potomac River's contribution to "background"
        sulfur dioxide levels - eliminating a double-counting of
        Mirant's contribution to ambient emission levels.

      * Using actual sulfur dioxide coal specifications rather
        than higher permitted levels that the plant's coal fuel
        does not reach.

      * Using actual particulate matter rates rather than higher
        permitted levels that the plant's stack emissions do not
        reach.

      * Using actual oxides of nitrogen rates, rather than higher
        permitted levels that the plant's stack emissions do not
        reach.

Since the August 24 shutdown of the Potomac River Generating
Station, Mirant has worked to develop a solution that would allow
the company to return the plant to operation as soon as possible.

Mirant's decision to temporarily close the plant came as a
result of the company's inability to satisfy DEQ's requirement to
meet NAAQS within the time allotted by the department.  The
study's computer modeling showed that air emissions from the
plant have the potential to contribute to localized, modeled
exceedances of NAAQS under certain atypical conditions.

Mirant acted with an abundance of caution by taking a series
of well-communicated steps over a five-day period to reduce, then
finally halt power production at the plant on August 24, 2005.

Headquartered in Atlanta, Georgia, Mirant Corporation --
http://www.mirant.com/-- is a competitive energy company that
produces and sells electricity in North America, the Caribbean,
and the Philippines.  Mirant owns or leases more than 18,000
megawatts of electric generating capacity globally.  Mirant
Corporation filed for chapter 11 protection on July 14, 2003
(Bankr. N.D. Tex. 03-46590).  Thomas E. Lauria, Esq., at White &
Case LLP, represents the Debtors in their restructuring efforts.
When the Debtors filed for protection from their creditors, they
listed $20,574,000,000 in assets and $11,401,000,000 in debts.
(Mirant Bankruptcy News, Issue No. 77; Bankruptcy Creditors'
Service, Inc., 215/945-7000)


MORTGAGE ASSET: Fitch Holds Low-B Rating on Seven Cert. Classes
---------------------------------------------------------------
Fitch Ratings has taken ratings actions on these Mortgage Asset
Securitization Transactions, Inc., alternative loan trust
transactions residential mortgage-backed certificates:

   MALT, Mortgage Pass-Through Certificates, Series 2002-1

      -- Class A affirmed at 'AAA'.

   MALT, Mortgage Pass-Through Certificates, Series 2003-4

      -- Class A affirmed at 'AAA';
      -- Class B-1 upgraded to 'AA' from 'AA-';
      -- Class B-2 upgraded to 'A+' from 'A-';
      -- Class B-4 affirmed at 'BB-'.

   MALT, Mortgage Pass-Through Certificates, Series 2003-7

      -- Class A affirmed at 'AAA';
      -- Class B-2 affirmed at 'A-';
      -- Class B-3 affirmed at 'BBB-'.

   MALT, Mortgage Pass-Through Certificates, Series 2003-8

      -- Class A affirmed at 'AAA'.

   MALT, Mortgage Pass-Through Certificates, Series 2003-9

      -- Class A affirmed at 'AAA';
      -- Class B-1 affirmed at 'AA-';
      -- Class B-2 affirmed at 'A-';
      -- Class B-3 affirmed at 'BBB';
      -- Class B-4 affirmed at 'BB-'.

   MALT, Mortgage Pass-Through Certificates, Series 2004-6

      -- Class A affirmed at 'AAA';
      -- Class B-2 affirmed at 'A-';
      -- Class B-3 affirmed at 'BBB-'.

   MALT, Mortgage Pass-Through Certificates, Series 2004-7

      -- Class A affirmed at 'AAA';
      -- Class B-1 affirmed at 'AA';
      -- Class B-2 affirmed at 'A';
      -- Class B-3 affirmed at 'BBB';
      -- Class B-4 affirmed at 'BB';
      -- Class B-5 affirmed at 'B'.

   MALT, Mortgage Pass-Through Certificates, Series 2004-8

      -- Class 1A affirmed at 'AAA';
      -- Class 2A affirmed at 'AAA';
      -- Class B-3 affirmed at 'BBB-';
      -- Class BI-1 affirmed at 'AA';
      -- Class BI-2 affirmed at 'A';
      -- Class BI-3 affirmed at 'BBB';
      -- Class BI-4 affirmed at 'BB'.

   MALT, Mortgage Pass-Through Certificates, Series 2004-10

      -- Class A affirmed at 'AAA';
      -- Class B-1 affirmed at 'AA-';
      -- Class B-2 affirmed at 'A-';
      -- Class B-3 affirmed at 'BBB-'.

   MALT, Mortgage Pass-Through Certificates, Series 2004-11

      -- Class 1A affirmed at 'AAA';
      -- Class 3A affirmed at 'AAA';
      -- Class BI-1 affirmed at 'AA';
      -- Class BI-2 affirmed at 'A';
      -- Class BI-3 affirmed at 'BBB';
      -- Class BI-4 affirmed at 'BB'.

   MALT, Mortgage Pass-Through Certificates, Series 2004-12

      -- Class 1A affirmed at 'AAA';
      -- Class 2A affirmed at 'AAA';
      -- Class BI-1 affirmed at 'AA';
      -- Class BI-2 affirmed at 'A';
      -- Class BI-3 affirmed at 'BBB';
      -- Class BI-4 affirmed at 'BB'.

The mortgage loans in the aforementioned transactions consist of
both 30-year fixed-rate and 15 year fixed-rate mortgages extended
to Alt-A borrowers that are secured by first and second liens,
primarily on one- to four-family residential properties.  As of
the August 2005 distribution date, the transactions are seasoned
from a range of nine (2004-2012) to 27 (2003-2004) months and the
pool factors (current mortgage loan principal outstanding as a
percentage of the initial pool) range from approximately 42%
(2003-2004) to 86% (2004-2012).  All of the MALT deals mentioned
above are service by Wells Fargo Bank Minnesota, N.A., which is
rated 'RPS1' by Fitch.

The affirmations reflect satisfactory credit enhancement
relationships to future loss expectations and affect approximately
$3.8 billion outstanding certificates as detailed above.  The
upgrade actions, which affect approximately $14 million
outstanding certificates, reflect an improvement in the
relationship of credit enhancement to future loss expectations

As of August 2005 distribution date, the pool factor for series
2003-4 is approximately 42%.  The CE levels for the series 2003-4
class B-1 and for class B-2 have more than doubled the original
enhancement levels at closing date.  They currently benefit from
6.39% (originally 2.85%) and 4.03% (originally 1.80%)
subordination, respectively.


MOVIE GALLERY: Amends $870 Million Senior Secured Credit Facility
-----------------------------------------------------------------
Movie Gallery, Inc. (Nasdaq: MOVI) entered into an amendment of
the Company's $870 million senior secured credit facility with its
bank group.

The amendment provides for an additional $50.0 million of
borrowings under the facility's Term Loan B tranche.  The
amendment also relaxes, for a one- year period, the required ratio
levels under the financial covenants contained in the credit
facility.  The amendment also increases the letter of credit
sublimit under the revolving credit facility from $30 million to
$40 million, but does not increase the overall revolving
commitment amount.

Under the terms of the amendment, the interest rate on Movie
Gallery's Term Loan B increases from London Interbank Offered Rate
plus 3% to LIBOR plus 3.75% (and effecting an equivalent increase
in margin under the base rate option applicable to the Term Loan
B).  Furthermore, an additional tier has been added to the pricing
grid contained in the senior credit facility.  The additional tier
is applicable to the revolving loan and Term Loan A tranches of
the facility and provides that if the Company's leverage ratio,
defined as total debt to EBITDA (as defined under the credit
agreement), exceeds 3.25 times, then the interest rate margin
applicable to revolving loans and Term Loan A will be 3.50% over
LIBOR (and 2.50% over the base rate).

As a condition to obtaining the consent of the lenders to the
foregoing amendments, Movie Gallery has agreed to pay an amendment
and consent fee equal to 0.25% of the aggregate total commitments
of those lenders that consent to the amendments, including those
lenders that provide the additional $50 million of borrowings
under Term Loan B.  The Company also agreed to provide certain
additional prepayment protections to the Term Loan B lenders and
to certain changes to the excess cash flow sweep contained in the
existing credit agreement.

As part of this amendment, the Company disclosed that it has
received a notice from Mark Wattles, the founder and former CEO of
Hollywood Entertainment, exercising a contractual right to require
the Company to purchase 20 Hollywood Video stores currently owned
by an entity controlled by Wattles pursuant to a "put" option
contained in the license agreement for these stores.  A portion of
the funds available to Movie Gallery under the increased Term Loan
B will be used to satisfy this obligation.  The remainder of the
additional borrowings under Term Loan B will be used for other
general corporate purposes.

Movie Gallery is the second largest North American video rental
company with annual revenue in excess of $2.6 billion and
approximately 4,800 stores located in all 50 U.S. states, Canada
and Mexico.  Since the Company's initial public offering in August
1994, Movie Gallery has grown from 97 stores to its present size
through acquisitions and new store openings.

                            *     *     *

As reported in the Troubled Company Reporter on Sept. 19, 2005,
Moody's Investors Services downgraded the long term debt ratings
of Movie Gallery, Inc., and speculative grade liquidity rating
over concerns that the industry trends demonstrated during the
second quarter as well as the impact of Hurricane Katrina to its
south eastern stores will constrain the company's operating
performance over the next twelve to eighteen months.  The outlook
is negative.

These ratings are downgraded:

   * Corporate Family to B2 from B1;

   * $870 Million of Senior Secured Credit Facilities to B2 from
     B1;

   * $325 Million of Guaranteed Senior Notes to B3 from B2;

   * Speculative Grade Liquidity Rating to SGL-3 from SGL-2.


NBTY INC: Closing 7-1/8% Senior Subordinated Debt Offering
----------------------------------------------------------
NBTY, Inc. (NYSE: NTY) closed its previously announced offering of
$200,000,000 aggregate principal amount of 7-1/8% Senior
Subordinated Notes due 2015.  In addition, NBTY has called for
redemption that portion of its $150,000,000 aggregate principal
amount of 8-5/8% Senior Subordinated Notes due 2007 that remains
outstanding on Oct. 24, 2005, the redemption date.  The redemption
price is equal to $1,000 per $1,000 principal amount of the Notes
validly tendered, plus accrued and unpaid interest to the
redemption date.

On Aug. 25, 2005, NBTY initiated a cash tender offer for any and
all of the Notes.

On Sept. 23, 2005, NBTY completed its previously announced tender
offer for any and all of its $150,000,000 aggregate principal
amount of 8-5/8% Senior Subordinated Notes due 2007.  A total of
$74,458,000 aggregate principal amount of Notes were tendered,
representing approximately 49.6% of the outstanding Notes.

Holders who tendered their Notes after 11:59 a.m. (EDT) on
Sept. 15, 2005, but prior to 11:59 p.m. (EDT) on Sept. 22, 2005,
received $980 per $1,000 principal amount of the Notes validly
tendered, which is equal to the total consideration less an early
participation payment of $20 per $1,000 principal amount of Notes
tendered.  The Early Participation Payment is paid only to holders
who validly tendered and did not revoke the tender of their Notes
prior to the Early Participation Date and whose Notes are accepted
for payment.  In each case, holders that validly tendered their
Notes and whose Notes are accepted for payment will receive
accrued and unpaid interest up to, but not including, the payment
date.  The payment date for any Notes tendered prior to the
Expiration Date and accepted for payment was Sept. 23, 2005.

NBTY, Inc. -- http://www.NBTY.com/-- is a leading vertically
integrated manufacturer and distributor of a broad line of high-
quality, value-priced nutritional supplements in the United States
and throughout the world.  The Company markets approximately 2,000
products under several brands, including Nature's Bounty(R),
Vitamin World(R), Puritan's Pride(R), Holland & Barrett(R),
Rexall(R), Sundown(R), MET-Rx(R), WORLDWIDE Sport Nutrition(R),
American Health(R), GNC (UK)(R), DeTuinen(R), LeNaturiste(TM) and
SISU(R).

                         *     *     *

As reported in the Troubled Company Reporter on July 20, 2005,
Standard & Poor's Ratings Services affirmed its ratings on vitamin
manufacturer NBTY Inc., including its 'BB' corporate credit
rating.

Standard & Poor's removed the ratings from CreditWatch, where they
were placed on June 7, 2005, with negative implications, following
NBTY's announcement of its plans to acquire nutritional supplement
manufacturer Solgar Vitamin and Herb, an operating unit of Wyeth
Consumer Healthcare, a division of Wyeth (A/Negative/A-1) for
$115 million.

At the same time, Standard & Poor's assigned its 'BB' bank loan
rating and a recovery rating of '2' to NBTY's proposed $120
million senior secured term loan A, indicating the expectation of
substantial (80%-100%) recovery of principal in the event of a
payment default.  The outlook on the Bohemia, New York-based
company is negative.  Pro forma total debt outstanding at
March 31, 2005, was about $412 million.

The proposed $120 million, five-year senior secured term loan A is
due 2010, or March 15, 2007, if the 8.625% senior subordinated
notes due Sept. 15, 2007, are still outstanding.  Proceeds of the
new term loan A will finance NBTY's pending acquisition of Solgar,
as part of a proposed credit facility amendment that will permit
the acquisition, as well as other modifications to the company's
existing credit facility.  The ratings are based on preliminary
terms and are subject to review upon final documentation.

Also, Moody's Investors Service rated NBTY Inc.'s new $120 million
senior secured term loan A at Ba2.  In addition, Moody's affirmed
NBTY's existing ratings, including its corporate family rating
(formerly, "senior implied rating") of Ba2.  Proceeds from the
term loan (net $115 million) will fund NBTY's pending acquisition
of Solgar from Wyeth.  Notwithstanding the risks associated with a
high-priced, debt-financed acquisition, the ratings affirmation
reflects the strong alignment of Solgar with NBTY's products,
integration capabilities, and long-term growth strategies, as well
as the ongoing solid financial profile and market position of NBTY
in the nutritional supplements industry.  Moody's says the outlook
remains stable.


NETWORK INSTALLATION: Acquires Kelley Tech. in an All-Equity Deal
-----------------------------------------------------------------
Network Installation Corp. (OTC Bulletin Board: NWKI) acquired
100% of the outstanding shares of Las Vegas-based Kelley
Communications Company, Inc. d/b/a Kelley Technologies.

KCCI is a national communications systems designer and project
engineering firm.  KCCI shareholders received 14,061,577 shares of
Network Installation common stock in the exchange.  Based on
Network Installation's un-audited reported revenue of $1.9 million
through June 30, 2005, and KCCI's un-audited revenue of
approximately $4.9 million through August of 2005, the combined
company's annual revenue run rate for 2005 is expected to be
approximately $10 million.

"Since the new management team arrived in March of this year, we
have publicly stated our strategy of accelerating our growth
through acquisition and after carefully evaluating a number of
opportunities which we were presented with, we chose to partner
with Kelley Technologies," Network Installation CEO Jeffrey R.
Hultman, said.  "The rationale for our partnership is simple; the
obvious synergies between our businesses, Kelley's long history of
success with an A-list of clients, and most importantly, the
stellar reputation of Michael Kelley and his team."  He added,
"Our strategy is aggressive, but our goal is to continue to grow
rapidly through high quality strategic acquisitions such as
Kelley, and grow organically, resulting in significant scale
within three years.  I believe we have now taken the first but
most important step towards that objective."

KCCI President Michael Kelley commented, "I am truly excited about
this partnership with Network Installation and pursuing the many
opportunities we currently have before us.  Jeff and his team have
a track record of multiple major successes within the
communications universe.  Network Installation's core competencies
in the delivery of data and voice communications systems are a
perfect complement to our technology design, engineering, and
project management capabilities.  I look forward to achieving
great success and to the continued growth of our combined
organization."

                       New Executives

Pursuant to the Agreement, Mr. Hultman was appointed Chairman of
Network Installation and will remain as CEO.  Mr. Kelley will
remain President of KCCI, a wholly owned subsidiary, and will join
the Network Installation Board of Directors.  Network Installation
CFO Michael V. Rosenthal, has also been appointed to the Board of
Directors.  Additionally, Network Installation Chairman Michael
Novielli and Directors Douglas Leighton and Theodore Smith have
resigned their positions as Directors of the Company.  The Company
plans to fill the remaining two vacancies on the Board before the
end of the year.

Outgoing Network Installation Chairman Michael Novielli stated,
"On behalf of Messrs. Leighton and Smith, we are extremely proud
to have delivered such a significant event and dynamic management
team to the Network Installation shareholders.  Since our
involvement began in April 2003, we've seen the Company grow its
annual revenues dramatically.  I believe we are departing the
Company with our mission accomplished.  It's now time to leave
Network Installation in the very capable hands of the management
team we've assembled, so that they may pursue their clearly
articulated vision."

Mr. Hultman added, "The Dutchess organization is one of the most
proficient, resourceful and capable teams of professionals I have
dealt with in my 35 year business career.  Their ability to create
solutions to challenges in matters of finance, business
strategies, legal or accounting alike, are second to none.  They
have been a tremendous asset to management and certainly critical
to the growth of Network Installation.  We are grateful for their
past contributions and although they still remain a major
shareholder we will miss their day to day input."

                  About Kelley Technologies

Founded in 1988, Kelley Communications Company, Inc., d/b/a Kelley
Technologies -- http://www.kccinc.com/-- designs and integrates
custom audio and video, communications and technologies serving
the gaming, hospitality and entertainment industries.  Michael
Kelley's IVC successfully implemented the first electronic sports
and racing book, which debuted in Las Vegas at Caesar's Palace.
Since then, Kelley Technologies has designed and built more than
70 Race Books, Sports Books and Off Track betting facilities
across North America. Some of its clients include; MGM Mirage,
Mandalay Bay Resort Group, University of Nevada Las Vegas, Whiting
Turner Construction, Harrah's Entertainment Group, Palm Resorts-
N9ne Group, Station Casinos, Borgata Resort and Casino, Perini
Building Group and Venetian Resorts and Casino.

Network Installation Corp. provides communications solutions to
the Fortune 1000, Government Agencies, Municipalities, K-12 and
Universities and Multiple Property Owners.  These solutions
include the design, installation and deployment of data, voice and
video networks as well as wireless networks including Wi-Fi and
Wi-Max applications and integrated telecommunications solutions
including Voice over Internet Protocol applications.  Network
Installation is available on the World Wide Web at
http://www.networkinstallationcorp.net/

At June 30, 2005, Network Installation's balance sheet showed a
$2,196,412 stockholders' deficit, compared to a $1,877,631 deficit
at Dec. 31, 2004.


NEW WORLD: Judge France Approves Amended Disclosure Statement
-------------------------------------------------------------
The Hon. Mary D. France of the U.S. Bankruptcy Court for the
Middle District of Pennsylvania approved the adequacy of the
Second Amended and Restated Disclosure Statement explaining the
Second Amended and Restated Joint Plan of Reorganization filed by
New World Pasta Company and its debtor-affiliates.  Judge France
put her stamp of approval on the Amended Disclosure Statement on
Sept. 23, 2005.

The Debtors are now authorized to send copies of the Amended
Disclosure Statement and Amended Joint Plan to creditors and
solicit their votes in favor of the Plan.

On the Effective Date of the Amended Plan, Reorganized New World
Pasta will be authorized to issue 10 million authorized shares of
New Common Stock at $0.01 par value per share.  A total of
7,500,000 shares will be issued and distributed, in accordance
with the Restructuring Transactions, to the holders of Allowed
Claims of Term Lender Claims and General Unsecured Claims pursuant
to Section IV of the Plan.

                 Treatment of Claims and Interests

Unimpaired Claims consist of:

  1) Priority Non-Tax Claims, totaling approximately $18,500 will
     be paid in full, in Cash after the Effective Date;

  2) Senior Lender Claims, totaling approximately $146,600,000
     will be paid in Cash in an amount equal to those holders'
     Allowed Claims, including accrued and unpaid interest
     calculated at the default rate, plus the reasonable,
     documented, accrued and unpaid fees and expenses of the
     Pre-petition Agent and the Prepetition Agent;s and Senior
     Lenders' legal advisors, financial advisors and consultants,
     net of amounts paid prior to the Effective Date; and

  3) Other Secured Claims totaling approximately $25,000 will
     received at the Debtors' option, either reinstatement of the
     Claim or cash payment in full, or surrender of the collateral
     securing that Allowed Claim, or treatment rendering that
     Allowed Claim unimpaired in accordance with Section 1124 of
     the Bankruptcy Code.

Impaired Claims consist of:

  1) Term Lender Claims totaling approximately $168,000,000 will
     receive on the Effective Date, distribution of 6,375,000
     shares of the Holdings Common Stock, which will constitute
     85% of the Holdings Common Stock issued on or after the
     Effective Date, subject to full dilution for the shares to be
     issued pursuant to the Management Incentive Plan, the New
     Warrants, and any issuance of equity or equity-linked
     distributions in connection with the Exit Facility;

  2) General Unsecured Claims totaling approximately $185,256,062
     will receive their Pro Rata Share of 1,125,000 shares of
     Holdings Common Stock, which will constitute 15% of the
     Holdings Common Stock issued after the Effective Date,
     subject to full dilution for the shares to be issued pursuant
     to the Management Incentive Plan, the New Warrants, and any
     issuance of equity or equity-linked distributions in
     connection with the Exit Facility and the New Warrants;

  3) Other Unsecured Claims totaling approximately $1,500,000 will
     on the Effective Date, cash payment in an amount equal to
     7.5%4 of each Allowed Claim; and

  4) NWP Equity Interests will not receive or retain any property
     or interest in property on account of Equity Interests in New
     World Pasta.

A full-text copy of the Amended Disclosure Statement is available
for a fee at:

     http://www.researcharchives.com/bin/download?id=050926023807

A full-text copy of the Amended Plan is available for a fee at:

     http://www.researcharchives.com/bin/download?id=050926024120

All ballots must be returned by Nov. 11, 2005, to the Debtors'
voting agent:

       Financial Balloting Group, LLC.
       757 Third Ave., 3rd Floor
       New York, New York 10017
       Tel. 646-282-1800

Objections to the Amended Plan, if any, must be filed and served
Nov. 7, 2005.

The Court will convene a confirmation hearing to consider the
merits of the Plan at 9:00 a.m., on Nov. 18, 2005.

Headquartered in Harrisburg, Pennsylvania, New World Pasta Company
-- http://www.nwpasta.com/-- is a pasta manufacturer in the
United States.  The Company, along with its debtor-affiliates,
filed for chapter 11 protection (Bankr. M.D. Penn. Case No. 04-
02817) on May 10, 2004.  Eric L. Brossman, Esq., and Robert Bein,
Esq., at Saul Ewing LLP, in Harrisburg, serve as the Debtors'
local counsel.  Bonnie Steingart, Esq., and Vivek Melwani, Esq.,
at Fried, Frank, Harris, Shriver & Jacobson LLP, represent the
Creditors' Committee.  In its latest Form 10-Q for the period
ended June 29, 2002, New World Pasta reported $445,579,000 in
total assets and $451,816,000 in total liabilities.


NORTHWEST AIRLINES: Paying $91MM Prepetition Employee Obligations
-----------------------------------------------------------------
Northwest Airlines Corporation and its debtor-affiliates,
excluding MLT Inc., employ approximately 39,000 employees.  During
peak travel periods, the Debtors employ additional temporary full-
time and part-time employees.

Approximately 6,900 of the Debtors' retired employees currently
receive employment related benefits from the Debtors.

To minimize personal hardships of the Employees, at the Debtors'
behest, the U.S. Bankruptcy Court for the Southern District of New
York authorizes:

   (i) them to pay certain prepetition wages, compensation and
       employee benefits;

  (ii) them to continue paying wages, compensation and employee
       benefit programs in the ordinary course of business and to
       pay other costs and expenses; and

(iii) applicable banks and other financial institutions to
       process and pay all checks presented for payment and to
       honor all funds transfer requests made by the Debtors in
       connection with their employee obligations.

                       Unpaid Compensation

(a) Employees

Bruce R. Zirinsky, Esq., at Cadwalader, Wickersham & Taft LLP, in
New York, relates that, in the ordinary course of business, the
Debtors issue payroll checks to both hourly and salaried
Employees.  The Debtors withhold certain federal, state, and
local income taxes, and social security and Medicare taxes and
remit the same to the appropriate taxing authorities.

The average gross monthly payroll to all Employees is
approximately $186 million, including $52.1 million for payroll
taxes.

The Debtors estimate that approximately $91 million in
prepetition wages, salaries and other non-incentive compensation
may remain unpaid at the Petition Date.

The Debtors have set up a separate tax trust to the withheld
taxes.  They intend to continue to make these payments through
the tax trust and as a result there will be no amounts owed for
taxes.

(b) Independent Contractors

The Debtors have contracted directly with approximately 500
individuals who have been trained to serve as flight attendants
in the event any of the Debtors' current flight attendants fail
to appear for work in connection with the strike by employees
represented by the Aircraft Mechanics Fraternal Association.
They also contracted Chimes, Inc., to provide information
technology contractors.

The Debtors owe the AMFA and Chimes contractors approximately
$25,000, and $3.5 million, respectively, for their prepetition
services.

                         Incentive Plans

The Debtors maintain incentive plans for different categories of
Employees.  The Debtors' gross prepetition obligations in
connection with the incentive plans sum to $20 million.

                 Vacation, Sick and Personal Days

Full-time and part-time Employees are eligible for paid vacation.
The Debtors have paid an average of $19.8 million a month in
accordance with the vacation policy, with $5.7 million paid for
payroll tax obligations.

In addition, under the applicable collective bargaining agreement
or company policy, Employees are entitled to certain sick leave
benefits.   Payments for sick and on-the-job injury leave
benefits are funded by the Debtors' VEBA Trust account.

Full-time Employees are also paid for 10 holidays per year.

           Workers' Compensation Programs and Benefits

The Debtors provide workers' compensation benefits to all
Employees.  These benefits are currently provided through a
program administered by Liberty Mutual Insurance and its
subsidiary Helmsman Management Services, LLC in all U.S. states
except North Dakota, Ohio, Wyoming and Washington, and certain
Canadian provinces.  Under their agreement with Liberty Mutual,
the Debtors' deductible is generally $2 million per occurrence,
but varies by jurisdiction.

With respect to the Debtors' foreign workers' compensation
policies, the Debtors comply with all local laws and regulations
and pay minimal amounts for the policies.

Liberty Mutual administers and pays the Debtors' workers
compensation claims, and thereafter bills the Debtors monthly for
reimbursement.  These monthly payments equal $3 million to $4
million.

The Debtors pay a yearly premium and fees for administrative
costs to Liberty Mutual of approximately $4 million.

The Debtors have posted to Liberty Mutual collateral in the form
of cash held in an escrow account and letters of credit, which
are subject to a reimbursement agreement with the issuing banks.

Employees in North Dakota, Ohio, Wyoming and Canada are
compensated through a separate procedure.  The Debtors pay those
Employees approximately $500,000 for workers' compensation claims
and claim administration services.

The Debtors have been qualified to self-insure their workers'
compensation claims in the State of Washington and have retained
Liberty Mutual to administer the Debtors workers' compensation
program in that state.  The Debtors estimate that they pay
approximately $200,000 per month to Washington for the claims in
that state.

At any given time, approximately 2,000 workers' compensation
claims are pending against the Debtors for which the Debtors have
reserved approximately $100 million in potential liability as of
June 30, 2005.

                        Employee Benefits

The Debtors have established various plans and policies to
provide the Employees with medical, dental, prescription drug,
disability, life insurance, retirement savings and other
benefits.

(a) Medical Benefits

The Debtors withdraw funds every business day from their VEBA
Trust accounts to cover incurred liabilities relating to medical,
pharmacy and dental benefits of Employees.

The Debtors pay approximately $26.87 million to $30.61 million
per month for medical and pharmacy obligations of Employees.
They also pay $2.56 million to $3.2 million per month for dental
obligations of Employees.

The Debtors also maintain medical and dental plans for
approximately 5,700 retired employees who elect to participate in
and are required to pay all or a portion of the medical and
dental premium based on age and years of service.

Retirees who participate in these plans pay for the cost of the
coverage through either deductions from annuity payments owed by
the Debtors to the retirees or through cash payments sent to the
Debtors and transferred to the Debtors' VEBA Trust shortly after
the amounts are withheld or received.  The actual amount of
deductions from annuity can range from approximately $1,009,000
to $1,037,000 per month.

(b) Insurance

The Debtors bear the entire cost of basic life insurance for
full-time Employees.  As of June 2005, they owed approximately
$315,000 to insurance companies for the prior month.

The Debtors maintain an additional life insurance plan in which
Employees may elect to participate.  As of June 2005, they
withheld approximately $770,000 from wages prior to the Petition
Date pending transfer to the insurance carriers.

The Debtors also maintain a voluntary accident and death
insurance plan covering approximately 9,270 Employees.  The
Debtors withheld $153,000 in prepetition Employee contributions.

The Debtors fund life insurance plan for certain Retired
Employees.  The Debtors' expenses for the plan can range from
approximately $30,000 to $31,000 per month.  As of June 2005,
they owed approximately $31,000 to insurance companies for
amounts relating to the program.

Certain Retired Employees are also entitled to continue their
basic, additional or supplemental life insurance coverage for 18
months after retirement but are required to pay 100% of the
premiums to the Debtors either via deductions from annuity checks
owed by the Debtors to the retirees or cash payments sent to the
Debtors.  The Debtors hold approximately $50,000 to $60,000 in
collected life insurance premiums pending transfer to the
insurance carrier.

The Debtors fund portions of long-term disability and short-term
disability plans for approximately 29,678 Employees.  As of June
2005, the Debtors hold approximately $498,000 in Employee
contributions withheld prior to the Petition Date, as well as
$525,000 in premiums relating to the prior month pending transfer
to the insurance carriers in the ordinary course of business.
The Debtors pay approximately $1,023,000 to $1,047,000 per month
for those plans.

(c) Retirement Savings

The Debtors maintain several retirement savings plans that meet
the requirements of Section 401(k) of the Internal Revenue Code
of 1986, or are qualified defined contribution plans under the
Internal Revenue Code.  The savings plan was amended effective
September 1, 2005.

(d) Pension Benefits

Northwest sponsors three tax-qualified noncontributory defined
benefit pension plans that cover substantially all of the
Debtors' domestic employees:

    1.  the Northwest Airlines Pension Plan for Pilot Employees;

    2.  the Northwest Airlines Pension Plan for Salaried
        Employees and;

    3.  the Northwest Airlines Pension Plan for Contract
        Employees.

The Plans are funded through a tax-qualified pension trust that
is supported by contributions from the Debtors.

Northwest also sponsors two nonqualified defined benefit pension
plans to pay benefits that may not be paid from the tax qualified
plans due to IRC limitations:

   1.  the Northwest Airlines Pension Excess Plan for Pilot
       Employees; and

   2.  the Northwest Airlines Excess Pension Plan for Salaried
       Employees.

Effective August 31, 2005, the Debtors have amended their
Salaried Pension Plan and Salaried Excess Plan to freeze future
benefit accruals under those Plans.

(e) SERP

The Debtors provide supplemental pension benefits to certain key
Employees pursuant to the Northwest Airlines, Inc. Supplemental
Executive Retirement Plan.  Eight executives currently
participate in the SERP.  All benefits under the SERP are
unfunded and are payable by the Debtors from its general assets.

(f) Employee Benefits for Foreign Workers

Approximately 50% of 2,300 foreign-based employees are located in
Japan.  The remaining international employees are located in 17
different countries.

The foreign employees receive benefits from numerous programs
varying widely based upon local laws and custom.  Amounts
expended under the Debtors' foreign benefit programs do not
exceed $17 million annually.

                 Reimbursable Business Expenses

The Debtors reimburse their Employees for certain business
expenses incurred in the performance of their duties.

The Debtors estimate that as of the Petition Date, an aggregate
of approximately $364,300 will be owed on account of the
reimbursable expenses.

                 Employee Payroll Garnishments &
                     Other Payroll Deductions

The Debtors are presented with garnishment or child support
orders requiring the withholding of Employee wages.  The average
amount withheld on account of the orders per month is
approximately $1.1 million.

The Employees often request deductions from their payroll for the
benefit of other parties, including, without limitation, union
dues or charitable contributions.

                         Severance Plans

The Debtors offer certain severance programs to their Employees.

In the last 12 months, the Debtors paid $2.0 million pursuant to
severance programs to their Employees.  The Debtors also paid
$1.7 million under severance agreements with various Employees.
They also paid $3.8 million for severance payments under
collective bargaining agreements with unions.

The Debtors owe approximately $16 million to union Employees
terminated prior to the Petition Date.

Northwest Airlines Corporation -- http://www.nwa.com/-- is the
world's fourth largest airline with hubs at Detroit,
Minneapolis/St. Paul, Memphis, Tokyo and Amsterdam, and
approximately 1,400 daily departures.  Northwest is a member of
SkyTeam, an airline alliance that offers customers one of the
world's most extensive global networks.  Northwest and its travel
partners serve more than 900 cities in excess of 160 countries on
six continents.  The Company and 12 affiliates filed for chapter
11 protection on Sept. 14, 2005 (Bankr. S.D.N.Y. Lead Case No. 05-
17930).  Bruce R. Zirinsky, Esq., and Gregory M. Petrick, Esq., at
Cadwalader, Wickersham & Taft LLP in New York, and Mark C.
Ellenberg, Esq., at Cadwalader, Wickersham & Taft LLP in
Washington represent the Debtors in their restructuring efforts.
When the Debtors filed for protection from their creditors, they
listed $14.4 billion in total assets and $17.9 billion in total
debts.  (Northwest Airlines Bankruptcy News, Issue No. 2;
Bankruptcy Creditors' Service, Inc., 215/945-7000)


NORTHWEST AIRLINES: Board Approves Amendment to Incentive Program
-----------------------------------------------------------------
Northwest Airlines Corporation discloses in a regulatory filing
with the Securities and Exchange Commission that its board of
directors approved a modification to the company's E-Commerce
Incentive Compensation Program on September 14, 2005.

The modification will allow certain previously granted awards
under the Plan that were canceled in connection with the
departure of certain officers from Northwest Airlines, Inc., the
principal operating subsidiary of the company, to be re-
allocated.

The Plan was adopted in 2000 as an incentive to management to
create, develop and maximize the value of Northwest's investment
in a number of e-commerce or Internet-based businesses.  Under
the E-Commerce Plan, 20% of the value of the investments in
excess of the cost of such investments plus a minimum compounded
annual return of 15% was set aside for awards to key employees of
Northwest.

Any new awards under the Plan will be granted with respect to the
same investments as the canceled awards and will be subject to
vesting conditions and other terms as will be approved by the
Compensation Committee.

Northwest Airlines Corporation -- http://www.nwa.com/-- is the
world's fourth largest airline with hubs at Detroit,
Minneapolis/St. Paul, Memphis, Tokyo and Amsterdam, and
approximately 1,400 daily departures.  Northwest is a member of
SkyTeam, an airline alliance that offers customers one of the
world's most extensive global networks.  Northwest and its travel
partners serve more than 900 cities in excess of 160 countries on
six continents.  The Company and 12 affiliates filed for chapter
11 protection on Sept. 14, 2005 (Bankr. S.D.N.Y. Lead Case No. 05-
17930).  Bruce R. Zirinsky, Esq., and Gregory M. Petrick, Esq., at
Cadwalader, Wickersham & Taft LLP in New York, and Mark C.
Ellenberg, Esq., at Cadwalader, Wickersham & Taft LLP in
Washington represent the Debtors in their restructuring efforts.
When the Debtors filed for protection from their creditors, they
listed $14.4 billion in total assets and $17.9 billion in total
debts.  (Northwest Airlines Bankruptcy News, Issue No. 2;
Bankruptcy Creditors' Service, Inc., 215/945-7000)


NORTHWEST AIRLINES: Interline Pacts Approved on Interim Basis
-------------------------------------------------------------
Northwest Airlines Corporation and its debtor-affiliates seek the
U.S. Bankruptcy Court for the Southern District of New York's
authority to assume certain interline traffic agreements,
industry-standard agreements and related clearinghouse agreements,
and immediately satisfy certain prepetition obligations pending
assumption of these agreements.

The Debtors also seek permission to satisfy certain obligations
to other airlines that are settled through airline clearinghouses
and certain prepetition frequent flyer obligations to other
airlines.

Bruce R. Zirinsky, Esq., at Cadwalader, Wickersham & Taft LLP, in
New York, tells Judge Gropper that the Debtors' Interline Traffic
Agreements with other carriers are an essential part of their
transportation services.  These arrangements facilitate
cooperation among airlines with respect to critical activities as
making reservations and transferring passengers, freight, baggage
and mail between airlines.

The Interline Traffic Agreements are the most basic level of
inter-airline coordination and cooperation agreements.  They do
not cover other relationships among airlines, like code sharing,
mutual acceptance of frequent flyer programs or other marketing
arrangements.

A non-exclusive list of the Debtors' Interline Traffic Agreements
is available at no charge at http://ResearchArchives.com/t/s?1d3

The Debtors' Industry Agreements facilitate transactions under
the Interline Traffic Agreements and also provide for fare
publication, appointment of travel agencies, and foreign currency
clearing procedures.  The Related Clearinghouse Agreements allow
the Debtors to effectuate transactions under the Interline
Traffic Agreements and certain other agreements.

The Debtors have a number of relationships with other airlines
under which obligations are settled through the Clearinghouses.
These relationships include, but are not limited to, the SkyTeam
Alliance, certain aspects of the Debtors' alliance agreements
with KLM, the Debtors' alliance agreements with Delta and
Continental Airlines, and various code share agreements with
other airlines.

A non-exclusive list of the Debtors' Industry Agreements and
Related Clearinghouse Agreements is available at no charge at
http://ResearchArchives.com/t/s?1d4

Mr. Zirinsky contends that any interruption or cessation of the
Debtors' ability to make and receive payments through the
Clearinghouses could precipitate a disruption in performance
under the Interline Traffic Agreements, and thus could have a
material adverse effect on the Debtors' businesses and jeopardize
their prospects for successful reorganization.

According to Mr. Zirinsky, certain services under the Interline
Traffic Agreements, Industry Agreements, and Related
Clearinghouse Agreements are the equivalent of industry wide
"utility" services for which there is no readily available
alternative.

                 Debtors Want to Pay Obligations

The Debtors believe that they are current with respect to
payments under the agreements to be assumed and, therefore, are
not required to provide adequate assurances of their future
performance under the agreements.

However, out of an abundance of caution, the Debtors want
immediate authority, but not the direction, to pay any
prepetition amounts owed under these agreements pending the
Court's approval of the assumption of the agreements.

The Debtors want to ensure a seamless transition into Chapter 11
for their customers, whose traveling experience in many instances
depends on the cooperation of the airlines under the Interline
Traffic Agreements, Industry Agreements and Related Clearinghouse
Agreements.

The Debtors' estimated net obligations owed to other airlines as
of the Petition Date:

          Agreement                     Net Obligations
          ---------                     ---------------
          SkyTeam Agreements              $57,000,000
          Code share Agreements           $22,000,000
          Frequent Flyer Agreements           $38,000

Without the discretion to pay certain undisputed prepetition
obligations to other airlines, the Debtors believe that:

   (i) their future revenue could suffer and their ability to
       serve their customers' needs and continue to operate
       within the airline industry and, thus, reorganize, could
       be in jeopardy; and

  (ii) the counterparties may not have any incentive to continue
       to provide services to the Debtors or may attempt
       unilateral self-help measures, including set-off or
       recoupment, to protect their interests.

Regardless of whether those actions are legally proper, Mr.
Zirinsky tells Judge Gropper that any disruption in the Debtors'
businesses, even for a short time, could be harmful to the
necessary goodwill of their customers.

To the extent that any of the agreements to be assumed provide
for the posting of a deposit or other security, Mr. Zirinsky
notes that the Debtors' request to assume the agreements is
conditioned upon a determination that they are not required to
provide any deposits or security.

Mr. Zirinsky says any request for a deposit or other security
would be based upon either (i) the Debtors' having commenced
these Chapter 11 cases or (ii) the Debtors' financial condition,
and, accordingly, the contractual provisions are unenforceable
under Section 365(e).  In this regard, the Debtors reserve the
right to withdraw their request to assume any agreement to be
assumed should they be required to provide a deposit or other
security under those contracts.

                          *     *     *

Judge Gropper grants the Debtors' request on an interim basis.

The Court directs all applicable banks and other financial
institutions to receive, process, honor, and pay any and all
checks drawn on the Debtors' accounts, whether those checks were
presented prior to or after the Petition Date, and make other
transfers.

Northwest Airlines Corporation -- http://www.nwa.com/-- is the
world's fourth largest airline with hubs at Detroit,
Minneapolis/St. Paul, Memphis, Tokyo and Amsterdam, and
approximately 1,400 daily departures.  Northwest is a member of
SkyTeam, an airline alliance that offers customers one of the
world's most extensive global networks.  Northwest and its travel
partners serve more than 900 cities in excess of 160 countries on
six continents.  The Company and 12 affiliates filed for chapter
11 protection on Sept. 14, 2005 (Bankr. S.D.N.Y. Lead Case No. 05-
17930).  Bruce R. Zirinsky, Esq., and Gregory M. Petrick, Esq., at
Cadwalader, Wickersham & Taft LLP in New York, and Mark C.
Ellenberg, Esq., at Cadwalader, Wickersham & Taft LLP in
Washington represent the Debtors in their restructuring efforts.
When the Debtors filed for protection from their creditors, they
listed $14.4 billion in total assets and $17.9 billion in total
debts.  (Northwest Airlines Bankruptcy News, Issue No. 2;
Bankruptcy Creditors' Service, Inc., 215/945-7000)


OAK CREEK: Section 341(a) Meeting Slated for Oct. 19
----------------------------------------------------
The U.S. Trustee for Region 17 will convene a meeting of Oak Creek
Park, LLC's creditors at Room 130, U.S. Federal Bldg., 280 S. 1st
Street #268, San Jose, California 95113-3004.  This is the first
meeting of creditors required under 11 U.S.C. Sec. 341(a) in all
bankruptcy cases.

All creditors are invited, but not required, to attend.  This
Meeting of Creditors offers the one opportunity in a bankruptcy
proceeding for creditors to question a responsible office of the
Debtor under oath about the company's financial affairs and
operations that would be of interest to the general body of
creditors.

Headquartered in San Francisco, California, Oak Creek Park, LLC
filed for chapter 11 protection on Sept. 21, 2005 (Bankr. N.D.
Calif. Case No. 05-56102).  Desmond J. Cussen, Esq., at Gibson,
Dunn and Crutcher represents the Debtor in its restructuring
efforts.  When the Debtor filed for protection from its creditors,
it listed estimated assets and debts of $10 million to
$50 million.


OM GROUP: Delivers Delayed Financial Reports to SEC
---------------------------------------------------
OM Group, Inc. (NYSE: OMG) completed the filing of its delayed
financial reports with the Securities and Exchange Commission.
The company's SEC filings have been delayed due to the restatement
of prior year financial statements included in the company's 2003
Form 10-K, which was filed on March 31, 2005.  The company filed
its 2004 Form 10-K on Aug. 22, 2005, and filed its Forms 10-Q for
the first and second quarter of 2005 on Friday, Sept. 23, 2005.
As a result, OM Group is now current with all its SEC filings.

                    Material Weakness

In August 2005, Ernst & Young, LLP, identified certain material
weaknesses in the Company's internal control over financial
reporting.  These control deficiencies, which relate primarily to
the Americas' operating location, resulted in errors in the:

   -- depreciation of fixed assets,
   -- amortization of intangible assets,
   -- deferral of costs,
   -- valuation of inventory,
   -- recording of accruals,
   -- revenue recognition,
   -- classification of certain assets and liabilities, and
   -- elimination of intercompany profit in inventory.

These errors resulted in adjustments to the accounts.

The Company has implemented improved internal controls and
efficiencies with respect to its monthly, quarterly and year-end
financial statement close processes.  Two key controls implemented
to remediate the issues raised by the material weakness include:

     (1) formal quarterly meetings among the chief executive
         officer, chief financial officer, group vice presidents,
         corporate controller and group controllers are held to
         discuss all significant and/or judgmental issues, facts
         and circumstances as well as accounting treatment of each
         issue, and a summary of the issues and conclusions is
         then shared with the audit committee and the Company's
         independent registered public accounting firm; and

     (2) the group vice presidents and corporate and group
         controllers sign an internal representation letter each
         quarter regarding their respective results, which cascade
         up to the chief executive officer and chief financial
         officer certifications pursuant to Sections 302 and 906
         of the Sarbanes-Oxley Act.

                      Events of Default

The delay by the Company in filing its Form 10-K for the year
ended Dec. 31, 2003, caused events of default under the indenture
governing the 9.25% Senior Subordinated Notes due Dec. 15, 2011.
The Company reclassified the Notes from long-term to current as of
March 31, 2004, which was the date the 2003 Form 10-K was due.
The Company filed its 2003 Form 10-K on March 31, 2005, and filed
its Form 10-Qs for each of the first three quarters of 2004 on
June 10, 2005.

The delay by the Company in filing its Form 10-K for the year
ended Dec. 31, 2004, and its Form 10-Q for the first quarter of
2005, resulted in new events of default under the indenture
governing the Notes.  Also, on Aug. 17, 2005, the trustee for the
Notes furnished a notice of default to the Company with respect to
the delay by the Company in filing its Form 10-Q for the second
quarter of 2005.  The delay would have become an event of default
if the Form 10-Q for the second quarter of 2005 were not filed by
Oct. 16, 2005.  However, the Company filed its 2004 Form 10-K on
Aug. 22, 2005, and is filing its Form 10-Qs for the first and
second quarter of 2005 on Sept. 23, 2005.

On Aug. 30, 2005, the trustee for the Notes furnished a letter to
the Company that gave the Company until Oct. 29, 2005, to furnish
to the trustee an annual compliance certificate required under the
indenture governing the Notes in order to avoid an event of
default under that indenture.  In the event the Company is unable
to avoid an event of default, the noteholders, or the indenture
trustee at the direction of the noteholders, would have the right
but would not be obligated, to accelerate payment of these Notes.

If any acceleration were to occur, based on discussions with the
Company's lead bank, the Company believes it would be able to
refinance the obligation on a long-term basis.

                     Going Concern Doubt

Ernst & Young had expressed substantial doubt about the Company's
ability to continue as a going concern after it audited its
financial statements for the fiscal year ended Dec. 31, 2004, due
to the Company's default and non-compliance with a covenant under
its Senior Secured Revolving Credit Facility.

               Second Quarter Financial Results

The company reported financial results for the 2005 second
quarter.  Net sales for the three months ended June 30, 2005, were
$314.7 million, versus $313.7 million for the comparable period in
2004.  Gross profit decreased to $40.6 million for the second
quarter of 2005 versus $70 million for the year-earlier period.
Net income was $11.3 million for the 2005 quarter, versus
$17.7 million, for the comparable period in 2004.

The decrease in the 2005 second-quarter performance was largely
due to lower cobalt metal prices, partially offset by higher
nickel prices.  The average price of cobalt for the second quarter
of 2005 was $15.03 compared with $24.91 for the second quarter of
2004.  Conversely, the average price of nickel for the second
quarter of 2005 was $7.44 compared with $5.67 for the year-earlier
quarter.

Other factors which had a negative impact on the company's second
quarter results include:

   -- the sale of cobalt finished goods manufactured using higher-
      cost raw materials that were purchased before the overall
      decrease in metal prices;

   -- lower nickel sales volumes;

   -- a lower of cost or market (LCM) charge of $2.3 million in
      2005 due to decreasing nickel metal prices at the end of the
      quarter;

   -- higher smelting and refining costs at the company's nickel
      refinery in Finland;

   -- the scheduled maintenance shutdown of its joint venture
      smelter; and

   -- the negative impact of currency exchange effects resulting
      from the stronger euro compared with the U.S. dollar.

Selling, general and administrative expenses for the second
quarter of 2005 decreased by $8.1 million, to 6.4% of sales,
versus 9.0% for the comparable period in 2004.  The decrease was
due principally to the receipt of $10.9 million of insurance
proceeds related to the shareholder class-action litigation,
reduced by $2.4 million of legal fees associated with the
litigation.  The settlement of these suits was expensed in 2003.

"The company's results for the second quarter of 2005 were not
entirely unexpected considering the scope and magnitude of the
previously disclosed challenges we faced," said Joseph Scaminace,
chairman and chief executive officer.  "In spite of those
challenges, we generated roughly $90 million of cash from
operations prior to paying our litigation settlement.  What's
clear, however, is the critical need to focus on a business model
that relies less on metal pricing and more on value-added,
technology-driven products and services.  The development and
execution of such a business model, one that fully leverages this
company's unique market position and overall operational health,
is our highest priority."

                      Six-Month Results

Net sales for the six months ended June 30, 2005 were
$666.6 million, versus $680.4 million for the comparable period in
2004.  Gross profit decreased to $96.4 million for the 2005 six-
month period versus $182.6 million for the year-earlier period.
Net income was $23.9 million for the first six months of 2005,
versus $65.9 million for the comparable period in 2004.  The
decrease in the six-month results was due primarily to the same
factors that impacted the second-quarter results.

SG&A expenses decreased by $10.8 million, to 8.4% of sales, in the
first six months of 2005, versus 9.8% for the comparable period in
2004. The decrease was principally due to 2004 charges to
administrative expense of $7.5 million related to the shareholder
lawsuits and $2.8 million for executive compensation awards. The
2005 amount includes an $8.7 million charge related to the former
chief executive officer's separation agreement and $8.5 million of
income from the receipt of net insurance proceeds related to the
shareholder lawsuits.

The company's first quarter results released on June 30, 2005 did
not include any estimate of a separation charge for the company's
former chief executive officer. The $8.7 million charge was
determined subsequent to that date and has been included in the
first quarter results as the former chief executive officer's
employment was terminated during the first quarter.

Operating activities provided cash of $19.2 million during the
2005 six- month period, versus providing cash of $10.9 million for
the comparable period in 2004. The amount in 2005 includes a cash
payment of $74 million for the shareholder class action
litigation. Excluding this payment, operating activities provided
cash of $93.2 million in the 2005 six-month period.

                      About the Company

OM Group -- http://www.omgi.com/-- is a leading, vertically
integrated international producer and marketer of value-added,
metal-based specialty chemicals and related materials.
Headquartered in Cleveland, Ohio, OM Group operates manufacturing
facilities in the Americas, Europe, Asia, Africa and Australia.


PARKWAY HOSPITAL: Gets Interim Okay to Use $3.7MM Cash Collateral
-----------------------------------------------------------------
The U.S. Bankruptcy Court for the Southern District of New York
entered a fifth interim order permitting The Parkway Hospital,
Inc., to use $3,660,000 of cash collateral securing repayment of
pre-petition debts to GE HFS Holdings, Inc.

When Parkway sought chapter 11 protection, it owed GE HFS
approximately $8,642,433 (including interest through June 30,
2005).  GE holds a first-priority security interest in certain
collateral, including but not limited to, accounts, accounts
receivable, contract rights, deposits, intangibles, inventory and
equipment.

Continued access to GE's cash collateral will allow the Debtor
to meet payroll and payroll expenses, obtain required services,
and provide working capital to continue the estate's ongoing
operations, and grant replacement security interests and liens
to GE.

To secure and provide adequate protection, GE is granted a valid
and perfected continuing replacement first-priority lien and
security interest upon the property of the Debtor's estate without
the necessity of filing, recording or serving any financing
statements, mortgages or other documents.  The liens will be
subject to carve-out expenses of at least $40,000 for fees payable
to the U.S. Trustee, the Creditors' Committee and its
professionals.

Parkway agrees to limit its use of GE's cash collateral to amounts
specified in a consensual budget.  A copy of that budget is
available for free at http://ResearchArchives.com/t/s?1d1

The final hearing to approve the Debtor's use of cash collateral
is scheduled on Sept. 29, 2005, at 2:30 p.m.

The Parkway Hospital, Inc., operates a 251-bed proprietary, acute
care community hospital located in Forest Hills, New York.  The
Company filed for chapter 11 protection on July 1, 2005 (Bankr.
S.D.N.Y. Case No. 05-14876).  Timothy W. Walsh, Esq., at DLA Piper
Rudnick Gray Cary US LLP, represents the Debtor in its
restructuring efforts.  When the Debtor filed for protection from
its creditors, it listed $28,859,000 in total assets and
$47,566,000 in total debts.


PLYMOUTH RUBBER: Has Until October 31 to Decide on Leases
---------------------------------------------------------
Plymouth Rubber Company, Inc., and Brite-Line Technologies, Inc.,
sought and obtained an extension from the U.S. Bankruptcy Court
for the District of Massachusetts, Eastern Division, of their time
to decide whether to assume, assume and assign, or reject
executory contracts and unexpired leases of nonresidential real
property pursuant to Section 365(d)(4) of the Bankruptcy Code.

The Debtors wanted an open-ended extension until confirmation of a
plan of reorganization.  The Bankruptcy Judge said the debtors
will have to come back with another request if they need an
extension beyond Oct. 31, 2005.

The Debtors need the extension to properly evaluate the leases.
They don't want to assume leases which could prove cumbersome to
the estates or reject leases that could prove useful to their
restructuring.

Headquartered in Canton, Massachusetts, Plymouth Rubber, Inc.,
manufactures and distributes plastic and rubber products,
including automotive tapes, insulating tapes, and other industrial
tapes, mastics and films.  Through its Brite-Line Technologies
subsidiary, Plymouth manufactures and supplies highway marking
products.  The Company and its subsidiary filed for chapter 11
protection on July 5, 2005 (Bankr. D. Mass. Case Nos. 05-16088
through 05-16089).  Victor Bass, Esq., at Burns & Levinson LLP,
represents the Debtors in their restructuring efforts.  When the
Debtors filed for protection from their creditors, they estimated
$10 million to $50 million in assets and debts.


RELIANCE GROUP: Bankruptcy Court Approves Disclosure Statement
--------------------------------------------------------------
The Hon. Arthur Gonzalez of the U.S. Bankruptcy Court for the
Southern District of New York put his stamp of approval on the
Disclosure Statement filed by the Official Committee of Unsecured
Creditors for Reliance Group Holdings, Inc., explaining its
chapter 11 plan for the parent company.

Judge Gonzalez says the Disclosure Statement contains adequate
information within the meaning of Section 1125 of the Bankruptcy
Code, complies with the requirements of the Bankruptcy Code and
Bankruptcy Rules, and, if creditors will read it, provides them
with ample information to make informed decisions when they vote
on the Committee's Plan.

The Creditors Committee is now authorized to distribute the
Disclosure Statement and solicit acceptances for the Plan.

The Official Committee of Unsecured Creditors filed the Plan of
Reorganization and an accompanying Disclosure Statement explaining
the Plan on Aug. 18, 2005.

The Creditors' Committee represents the Debtor's general unsecured
creditors, which hold an estimated $600 million in claims.  These
claims principally include:

   -- the claims of creditors holdings notes issued under certain
      senior and subordinated bond indentures;

   -- the claims of the Pension Benefit Guaranty Corporation; and

   -- the claims of certain of the Debtor's directors, officers,
      and employees.

                         About the Plan

The Plan is the result of extensive negotiations among the Debtor,
the Creditors' Committee, the Bank Committee, the PBGC, and the
Liquidator.

The Plan calls for RGH's liquidation, which will be principally
implemented through a Liquidating Trust.  The Plan distributes the
Debtor's remaining assets to its general unsecured creditors
through the Liquidating Trust, which will receive all of the
Debtor's assets.  The assets to be distributed include cash,
certain tax-related assets, and a portion of the recoveries from
certain lawsuits.  The Committee said that these distributions,
spread over all of the claims, provide less than full recovery to
general unsecured creditors.

A full-text copy of the Creditors' Committee's Liquidating Plan of
Reorganization for RGH is available for a fee at

     http://www.researcharchives.com/bin/download?id=050823010234

A full-text copy of the Disclosure Statement accompanying the Plan
is available for a fee at

     http://www.researcharchives.com/bin/download?id=050823010604

A full-text copy of the Liquidating Trust Agreement is available
for a fee at

     http://www.researcharchives.com/bin/download?id=050823020006

Headquartered in New York, New York, Reliance Group Holdings, Inc.
-- http://www.rgh.com/-- is a holding company that owns 100% of
Reliance Financial Services Corporation.  Reliance Financial, in
turn, owns 100% of Reliance Insurance Company.  The holding and
intermediate finance companies filed for chapter 11 protection on
June 12, 2001 (Bankr. S.D.N.Y. Case No. 01-13403) listing
$12,598,054,000 in assets and $12,877,472,000 in debts.  The
insurance unit is being liquidated by the Insurance Commissioner
of the Commonwealth of Pennsylvania.  (Reliance Bankruptcy News,
Issue No. 77; Bankruptcy Creditors' Service, Inc., 215/945-7000)


RELIANCE GROUP: Committee Has Until Oct. 28 to Solicit Acceptances
------------------------------------------------------------------
The Hon. Arthur Gonzalez orders the Official Unsecured Creditors'
Committee to distribute the Solicitation Materials before
Sept. 28, 2005.

Judge Gonzalez further sets:

   -- Sept. 23, 2005, as the Voting Record Date, to determine
      which holders of claims against Reliance Group Holdings,
      Inc., are entitled to receive Solicitation Materials, and
      which holders are entitled to vote to accept or reject the
      Plan of Reorganization;

   -- Oct. 28, 2005, 4:00 p.m., Prevailing Eastern time, as
      the Confirmation Objection Deadline; and

   -- Nov. 7, 2005, 2:00 p.m., Prevailing Eastern time, as
      the Confirmation Hearing Date.

Within 25 days before the Confirmation Objection Deadline, the
Creditors' Committee will publish the Confirmation Hearing Notice
once in The Wall Street Journal (National Edition).  The
Creditors' Committee will post the Solicitation Materials and the
Confirmation Hearing Notice on the Web site of Bankruptcy
Services, LLC, the Debtors' claims agent.

Parties challenging the allowance of claims for voting purposes
must serve upon counsel to the Creditors' Committee, and file
with the Court, by October 18, 2005, a request to temporarily
allow the Claim for purposes of voting to accept or reject the
Plan.  The requests and Confirmation Objections must be delivered
to:

        Counsel to the Creditors' Committee:

             Orrick, Herrington & Sutcliffe
             666 Fifth Avenue
             New York, New York 10103
             Attn: Arnold Gulkowitz, Esq.

        Counsel to RGH:

             Debevoise & Plimpton
             919 Third Avenue
             New York, New York 10022
             Attn: Steven R. Gross, Esq.

        Counsel to the Bank Committee:

             White & Case
             1155 Avenue of the Americas
             New York, New York 10036
             Attn: Andrew P. DeNatale, Esq.

        Counsel to the Liquidator:

             Blank Rome
             The Chrysler Building
             405 Lexington Avenue
             New York, New York 10174
             Attn: Michael Z. Brownstein, Esq.

        Counsel to the U.S. Trustee:

             The Office of the U.S. Trustee
             33 Whitehall Street, Suite 2100
             New York, New York 10004
             Attn: Mary Tom, Esq.

Ballots must be properly executed, completed and delivered to the
Voting Agent on or before Oct. 28, 2005, at 4:00 p.m., Prevailing
Eastern time.

Beneficial Holders must return their Ballots to the Record Holder
with sufficient time for the Record Holder to submit the Master
Ballot to the Voting Agent before the Voting Deadline.  Ballots
must be returned to the Voting Agent before the Voting Deadline
by:

   (1) mail in the return envelope provided with each Ballot;
   (2) overnight delivery; or
   (3) hand delivery.

Ballots submitted by facsimile or other electronic means will not
be counted.  Record Holders for holders of Class 3a Claims and
Class 3b Claims that make the Opt-Out Election must deliver the
related securities to the designated account in accordance with
the Depositary Trust Company's Automated Tender Offer Program by
the Voting Deadline.

Headquartered in New York, New York, Reliance Group Holdings, Inc.
-- http://www.rgh.com/-- is a holding company that owns 100% of
Reliance Financial Services Corporation.  Reliance Financial, in
turn, owns 100% of Reliance Insurance Company.  The holding and
intermediate finance companies filed for chapter 11 protection on
June 12, 2001 (Bankr. S.D.N.Y. Case No. 01-13403) listing
$12,598,054,000 in assets and $12,877,472,000 in debts.  The
insurance unit is being liquidated by the Insurance Commissioner
of the Commonwealth of Pennsylvania.  (Reliance Bankruptcy News,
Issue No. 77; Bankruptcy Creditors' Service, Inc., 215/945-7000)


RITE AID: Posts $1.6 Million Net Loss in Second Quarter
--------------------------------------------------------
Rite Aid Corporation (NYSE, PCX: RAD) reported financial results
for its second quarter ended Aug. 27, 2005.

Revenues for the 13-week first quarter were $4.13 billion versus
revenues of $4.12 billion in the prior year second quarter.
Revenues increased 0.2%.

Same store sales increased 0.5 percent during the second
quarter as compared to the year-ago like period, consisting
of a 0.8% pharmacy same store sales decrease and a
3% increase in front-end same store sales.  Prescription
sales accounted for 63% of total sales, and third party
prescription sales represented 93.9% of pharmacy sales.

The second quarter had a loss of $1.6 million or $0.03 per
diluted share compared to last year's second quarter net income of
$9.9 million or $0.00 per diluted share.  The decrease was due
primarily to a $21.6 million decrease in adjusted EBITDA (which
is reconciled to net loss or income on the attached table), a
$9.2 million loss on debt modification compared to $0.8 million
gain in the prior year quarter, a $6.8 million increase in the
LIFO charge and a $5.9 million premium paid to redeem the
outstanding shares of the company's Series F Cumulative
Convertible Pay-in-Kind Preferred Stock.

These negative factors were partially offset primarily by a
$9 million decrease in interest expense, a $6.4 million increase
in litigation settlement income and a $5.3 million decrease in
store closing and impairment charges.

Adjusted EBITDA amounted to $149.3 million or 3.6% of revenues.
This compares to $170.9 million or 4.1% of revenues for the like
period last year.  The decrease was due to an increase in
occupancy costs and selling, general and administrative expenses.

"Sales moved back into positive territory this quarter with solid
front end same store sales increases.  While still disappointing,
pharmacy sales also improved as we began to cycle the negative
impact of the United Auto Workers mandatory mail prescription
plan.  We expect these positive trends to continue for the
remainder of the year," said Mary Sammons, Rite Aid president and
CEO.  "We also continued to make good progress on our new store
development program and are on track to make our target of 80 new
and relocated stores by the end of fiscal 2006."

In the second quarter, the company relocated 9 stores, acquired 2
stores, closed 11 stores and remodeled 60 stores.  Stores in
operation at the end of the quarter totaled 3,345.

            Company Confirms Guidance for Fiscal 2006

Based on current trends and taking into consideration expected
insurance reimbursement for losses and damages resulting from
Hurricane Katrina, Rite Aid confirmed its fiscal 2006 guidance.
The company said it expects sales to be between $17.1 billion and
$17.4 billion, with same store sales improving 0.5% to 2% over
fiscal 2005.  Net income for fiscal 2006 is expected to be between
$31 million and $62 million or a loss per share of $0.01 to net
income of $0.04 per diluted share.  Adjusted EBITDA is expected to
be between $675 million and $725 million. Capital expenditures are
expected to be between $350 million and $400 million.

Rite Aid Corporation -- http://www.riteaid.com/-- is one of
the nation's leading drugstore chains with annual revenues of
$16.8 billion and approximately 3,400 stores in 28 states and the
District of Columbia.

                         *     *     *

As reported in the Troubled Company Reporter on Sept 1, 2005,
Moody's Investors Service lowered the Speculative Grade Liquidity
Rating of Rite Aid Corporation to SGL-3 from SGL-2, affirmed all
long-term debt ratings (Corporate Family Rating of B2), and
revised the rating outlook to negative from stable.  The downgrade
of the Speculative Grade Liquidity Rating reflects Moody's
expectation that mediocre operating cash flow and planned capital
investment increases over the next twelve months will require the
company to rely on external financing sources to cover the cash
flow deficit.

While liquidity over the next twelve months is adequate, revision
of the outlook to negative on Rite Aid's long-term debt ratings
reflects Moody's concern that operating results have stabilized at
a level insufficient to fully fund fixed charges such as debt
service, cash preferred stock dividends, and capital investment,
as well as the company's weak operating performance relative to
higher rated peers.

This rating is lowered:

   -- Speculative Grade Liquidity Rating to SGL-3 from SGL-2.

Ratings affirmed are:

   -- $860 million 2nd-lien senior secured notes (comprised of 3
      separate issues) at B2;

   -- $1.28 billion of senior notes (comprised of 8 separate
      issues) at Caa1;

   -- $250 million of 4.75% convertible notes (2006) at Caa1; and

   -- Corporate Family Rating (previously called the Senior
      Implied Rating) at B2.


ROYAL GROUP: Board of Directors OKs Comprehensive Improvement Plan
------------------------------------------------------------------
Royal Group Technologies Limited's (RYG-TSX; RYG-NYSE) Board of
Directors has approved a comprehensive improvement plan, which was
formulated over the past two months under the direction of
Lawrence J. Blanford, who was appointed as the Company's CEO on
May 13, 2005.  A premiere global strategic consulting firm
supported by PricewaterhouseCoopers has assisted Royal Group to
expeditiously assemble the plan.  On July 14, 2005, Royal Group
had begun the planning process and that its Board had approved the
four-part management plan framework involving:

   -- Business unit portfolio restructuring;
   -- Pursuit of cost and margin opportunities;
   -- Full potential strategic plans for core business units; and
   -- Exploration of options to refinance the Company.

Royal Group's plan is intended to support either the sale of the
Company, or its continuation as a public entity should an
acceptable offer not result from the previously announced sale
process.  The Company opened a data room on July 25, 2005,
containing historical financial, operational, legal and human
resource information for potential bidders to peruse.

Elements of the management plan will be included in a confidential
information memorandum to be provided to potential bidders in the
coming weeks.  Thereafter, qualified bidders will be invited to
management presentations of the plan and be given an opportunity
to propose offers for the company.  At this time, no offer has
been made to purchase shares or assets of Royal Group and there
can be no assurance that such an offer will be made.

"Our plan is founded on clear, achievable goals, which have been
established by those managers who will drive plan
implementation"," said Mr. Blanford.  "We are narrowing the focus
of Royal Group to best leverage our financial and human resources,
to better control costs, to position our product offerings, to
maximize profitability, and to create a financial structure that
will allow us to attain the full potential of our core
businesses," added Mr. Blanford.

Details of Management's Improvement Plan include:

    1. Business unit portfolio restructuring, involving actions to
       divest non-core operations and actions to recast or divest
       of non-performing operations

       On July 28, the Company reported its intention to divest
       of certain subsidiaries deemed to be non-core, including
       Baron Metal Industries, Royal Alliance and Roadex
       Transport.  In addition, the company announced its
       intention to divest of its unprofitable Polish subsidiary.
       Discussions with potential acquirers of these business
       units are active, with several letters of intent to
       potentially acquire Baron Metal Industries having been
       received.  Royal Group is presently concluding reviews of
       certain other business units, which may be divested of if
       they are found to be non-core or non-performing.

    2. Actions to secure cost and margin opportunities,
       divisionally and across the enterprise

       The Company's plan includes a number of initiatives to
       streamline its production processes and reduce costs,
       including:

       -- introduction of operator-employed statistical process
          control (SPC) techniques to approximately one third of
          extrusion lines by the end of 2006 and 50% by the end of
          2007;

       -- refitting about 20% of extrusion lines with high-speed
          tooling by the end of 2006, thereby further improving
          efficiencies;

       -- rationalization of 400,000 square feet of manufacturing
          space over the planning period, in excess of the plant
          space that will be eliminated through divestitures;

       -- increase use of global operations to assist in the
          procurement of materials and manufacturing of certain
          commodity products for the North American market;

       -- analyses of profit by product and customer in all
          divisions, driving profit improvement actions to be
          implemented throughout 2006;

       In addition to these initiatives, Royal Group will
       increasingly centralize its purchasing function to better
       leverage the purchasing power of the entire organization,
       engage in more coordinated logistical planning and raw
       material formulations across the manufacturing organization
       to improve efficiencies and attain cost savings.

    3. Pursuing the strategic full potential of core business
       units Management's strategic imperatives were determined
       through careful assessment of several key issues or
       questions for each of Royal's core businesses.  Outcomes
       from these analyses were then used to guide the strategic
       direction of each business and the enterprise.  Consistent
       with the strategic direction, initiatives, programs and
       projects were identified and outlined.
       There are many initiatives, including:

       -- a focus on cellular and composite technology.  In fact
          three new cellular and composite products will be
          introduced this year and fully commercialized in 2006.

       -- accelerated development of the Royal brand supported by
          enhanced strategic marketing capability.

       -- cross marketing and bundling of Royal's divisional
          product profiles.

       Finally, well defined financial targets for each business
       and the enterprise were established, drawing on cost,
       margin and strategic initiatives to calibrate the full
       potential of the Group.

    4. Exploration of options to refinance the Company

       The Company is in active discussions with a number of
       potential lenders to put in place a more efficient capital
       structure, create additional liquidity and capital to take
       advantage of growth opportunities that may arise during the
       planning horizon.  Refinancing plans will be developed and
       vetted over the next two months, so that they may be
       quickly executed should the company remain independent.

"The broader environment for our products remains positive.  We
believe that we are well positioned to take advantage of the
opportunities afforded by an aging housing stock and aging
homeowners with the resources to finance renovations", concluded
Mr. Blanford.

Royal Group Technologies Limited -- http://www.royalgrouptech.com/
-- manufactures innovative, polymer-based home improvement,
consumer and construction products.  The company has extensive
vertical integration, with operations dedicated to provision of
materials, machinery, tooling, real estate and transportation
services to its plants producing finished products.  Royal Group's
manufacturing facilities are primarily located throughout North
America, with international operations in South America, Europe
and Asia.

                         *      *      *

As reported in the Troubled Company Reporter on May 11, 2005,
Standard & Poor's Ratings Services lowered its long-term
corporate  credit and senior unsecured debt ratings on Royal
Group Technologies Ltd. to 'BB' from 'BBB-'.  At the same time,
Standard & Poor's removed its ratings on Royal Group from
CreditWatch, where they were placed with negative implications
Oct. 15, 2004.  S&P said the outlook is currently negative.


RUSSELL WYNN: Wants to Hire Ling Robinson as Bankruptcy Counsel
---------------------------------------------------------------
Russell D. Wynn, dba R D Wynn Farms, asks the U.S. Bankruptcy
Court for the District of Idaho for permission to employ Ling,
Robinson & Walker, as its general bankruptcy counsel.

As the Debtor's lead bankruptcy counsel, Ling Robinson will assist
the Debtor in all activities necessary to carry out its duties and
responsibilities as a debtor-in-possession in a chapter 11
bankruptcy and assist the debtor in preparing a proposed
disclosure statement and plan of reorganization.

Ling Robinson will also represent the Debtor in all further
proceedings in its case and provide all other legal services
necessary for its chapter 11 case.

Brent T. Robinson, Esq., a Partner of Ling Robinson, is the lead
attorney for the Debtor.  Mr. Robinson discloses that counsel of
his Firm performing services to the Debtor will charge $150 per
hour.

Ling Robinson had not yet submitted its retainer amount to the
Debtor when the Debtor filed its request with the Court to employ
the Firm as its bankruptcy counsel.

Ling Robinson assures the Court that it does not represent any
interest materially adverse to the Debtor or its estate.

Headquartered in American Falls, Idaho, Russell D. Wynn, dba R D
Wynn Farms, filed for chapter 11 protection on Sept. 14, 2005
(Bankr. D. Idaho Case No. 05-42144).  When the Debtor filed for
protection from its creditors, it listed estimated assets of
$1 million to $10 million and estimated debts of $10 million to
$50 million.


SAINT CASIMIR: Wants Rattet Pasternak as Bankruptcy Counsel
-----------------------------------------------------------
Saint Casimir Development Corporation asks the Honorable Adlai S.
Hardin, Jr., of the U.S. Bankruptcy Court for the Southern
District of New York, White Plains Division, for permission to
employ Rattet, Pasternak & Gordon Oliver, LLP, as its bankruptcy
counsel, nunc pro tunc to Sept. 23, 2005.

Rattet Pasternak will:

   (a) advise the Debtor with respect to its powers and duties as
       a debtor-in-possession and the continued management of its
       property and affairs;

   (b) work out a plan of reorganization, taking the necessary
       legal steps to effectuate that plan including, if need be,
       negotiations with creditors of the Debtor and other
       parties-in-interest;

   (c) prepare the necessary answers, orders, reports and other
       legal papers that are required;

   (d) appear before the Bankruptcy Judge and protect the
       interests of the Debtor and represent the Debtor in all
       matters pending before the Court;

   (e) perform all other legal services for the Debtor, which may
       be necessary to preserve the Debtor's estate and to promote
       the best interests of the Debtor, its creditors and its
       estate.

Jonathan S. Pasternak, Esq., a member of Rattet, Pasternak &
Gordon Oliver, LLP, discloses that the Firm received a $30,000
retainer.

The hourly rates of professionals engaged are:

      Professional                           Hourly Rate
      ------------                           -----------
      Robert L. Rattet, Esq.                     $500
      Jonathan S. Pasternak, Esq.                $415
      Richard J. Rubin, Esq.                     $375
      James B. Glucksman, Esq.                   $360
      Dawn Arnold, Esq.                          $350
      Arlene Gordon Oliver, Esq.                 $375
      Erica Feynman, Esq.                        $225
      Joseph C. Corneau, Esq.                    $225
      Julie A. Cvek, Esq.                        $180
      Paralegals                                 $105

The Debtor believes that Rattet, Pasternak & Gordon Oliver, LLP,
is disinterested as that term is defined in Section 101(14) of the
U.S. Bankruptcy Court.

With two offices in New York, Rattet, Pasternak & Gordon Oliver,
LLP -- http://www.rattetlaw.com/-- specializes in bankruptcy,
credit relationships, commercial litigation, real estate workouts,
and new venture developments.

Headquartered in Yonkers, New York, Saint Casimir Development
Corporation operates a 107-unit, independent living, low-income,
senior residence.  The Debtor also leases the concourse level to
commercial tenants.  The Debtor filed for chapter 11 protection on
September 23, 2005 (Bankr. S.D.N.Y. Case No. 24239).  Erica R.
Feynman, Esq., and Jonathan S. Pasternak, Esq., at Rattet,
Pasternak & Gordon Oliver, LLP, represent the Debtor in its
restructuring efforts.  When the Debtor filed for protection from
its creditors, it listed $5,600,000 in assets and $10,822,000 in
debts.


SAINT VINCENTS: Gets Final Court Nod to Access Cash Collateral
--------------------------------------------------------------
The U.S. Bankruptcy Court for the Southern District of New York
issued a final order granting Saint Vincents Catholic Medical
Centers of New York and its debtor-affiliates authority to use
Cash Collateral.

As reported in the Troubled Company Reporter, the Debtors asked
the Bankruptcy Court's permission to access Cash Collateral
securing repayment of prepetition secured debts owed to:

      Total
     Amount     Collateral
      Owed        Value      Lender
  ------------ ------------  ------
  $179,000,000 $349,000,000  Dormitory Authority of the
                             State of New York

    77,000,000  196,000,000  Sun Life Assurance Company of Canada

    16,000,000   76,000,000  RCG Longview II, L.P.

    50,000,000   84,000,000  Commerce Bank

    35,000,000  134,000,000  HFG HealthCo-4 LLC

     6,000,000    2,200,000  Primary Care Development Corporation

The Bankruptcy Court grants the holders of Liens on the Cash
Collateral valid, automatically perfected and enforceable
replacement liens upon, and security interests in, accounts
receivable generated after the Petition Date.

As additional adequate protection of, and to protect against
diminution in, the value of the Secured Creditors' interest in the
Cash Collateral, the Secured Creditors will be entitled to an
administrative expense claim under Section 507(b) of the
Bankruptcy Code with priority over any or all of the
administrative expenses specified in Section 507(a)(1).

The Final Cash Collateral Order incorporates the individual
stipulations the Debtors entered into to resolve objections by:

   -- Comprehensive Cancer Corporation of New York, Inc.,

   -- Sun Life Assurance Company of Canada and Sun Life Assurance
      Company of Canada (U.S.), and

   -- RCG Longview II, L.P.

To the extent not settled or withdrawn, all objections to the
Debtors' request are overruled.

Headquartered in New York, New York, Saint Vincents Catholic
Medical Centers of New York -- http://www.svcmc.org/-- the
largest Catholic healthcare providers in New York State, operate
hospitals, health centers, nursing homes and a home health agency.
The hospital group consists of seven hospitals located throughout
Brooklyn, Queens, Manhattan, and Staten Island, along with four
nursing homes and a home health care agency.  The Company and six
of its affiliates filed for chapter 11 protection on July 5, 2005
(Bankr. S.D.N.Y. Case No. 05-14945 through 05-14951).  Gary
Ravert, Esq., and Stephen B. Selbst, Esq., at McDermott Will &
Emery, LLP, represent the Debtors in their restructuring efforts.
As of Apr. 30, 2005, the Debtors listed $972 million in total
assets and $1 billion in total debts.  (Saint Vincent Bankruptcy
News, Issue No. 10; Bankruptcy Creditors' Service, Inc.,
215/945-7000)


SAINT VINCENTS: Revises Sun Life Cash Collateral Deal
-----------------------------------------------------
The U.S. Bankruptcy Court for the Southern District of New York
approved amendments to the Stipulation resolving issues related to
Saint Vincents Catholic Medical Centers of New York and its
debtor-affiliates continued use of Sun Life Assurance Company of
Canada's cash collateral.

As reported in the Troubled Company Reporter, Saint Vincent
Catholic Medical Centers of New York issued $78.3 million in
promissory notes to the order of Sun Life Assurance Company of
Canada and Sun Life Assurance Company of Canada (U.S.) prior to
its bankruptcy filing.  The Promissory Notes are secured by first
priority liens to the Debtors' various properties.  On July 1,
2005, SVCMC defaulted on its obligation to pay Sun Life $500,214
under the Loan Documents.

Sun Life asserted that its interest in the cash collateral is not
adequately protected from diminution in value during the pendency
of the Debtors' bankruptcy cases and consequently asked for
adequate protection.  The Debtors inked a stipulation to resolve
Sun Life's objection to the use of the cash collateral.

The Amended stipulation incorporates these terms:

   (A) The superpriority administrative claim will be subject to
       the Carve-out and the superpriority administrative claim
       of the DIP Lenders in connection with the DIP Loan, and
       will be pari passu with any other superpriority
       administrative claim arising under Section 507(b) of the
       Bankruptcy Code.  It will have priority in payment over
       all administrative expenses or priority claims; and

   (B) The Debtors will pay Sun Life $69,846 for professional
       fees and expenses due under the Loan Documents from the
       Petition Date through September 6, 2005, and will be
       allowed reimbursement of reasonable attorneys fees and
       expenses associated with the Debtors' cases not to exceed
       $10,000 on a monthly basis; and

   (C) The Reimbursement Cap will not apply to costs and expenses
       incurred in connection with any successful action by Sun
       Life to enforce any of the Loan Documents or any provision
       of the stipulation, and any fees and expenses incurred in
       excess of the Cap will be added to the Sun Life Claim.

Headquartered in New York, New York, Saint Vincents Catholic
Medical Centers of New York -- http://www.svcmc.org/-- the
largest Catholic healthcare providers in New York State, operate
hospitals, health centers, nursing homes and a home health agency.
The hospital group consists of seven hospitals located throughout
Brooklyn, Queens, Manhattan, and Staten Island, along with four
nursing homes and a home health care agency.  The Company and six
of its affiliates filed for chapter 11 protection on July 5, 2005
(Bankr. S.D.N.Y. Case No. 05-14945 through 05-14951).  Gary
Ravert, Esq., and Stephen B. Selbst, Esq., at McDermott Will &
Emery, LLP, represent the Debtors in their restructuring efforts.
As of Apr. 30, 2005, the Debtors listed $972 million in total
assets and $1 billion in total debts.  (Saint Vincent Bankruptcy
News, Issue No. 10; Bankruptcy Creditors' Service, Inc.,
215/945-7000)


SIGNATURE 5: Moody's Reviews $20 Million Class C Notes' B2 Rating
-----------------------------------------------------------------
Moody's Investors Service, as part of the rating monitoring
process, placed the following Class of Notes issued by Signature 5
L.P., a collateralized debt obligation issuance, on the Moody's
Watchlist for possible upgrade:

   * $20,000,000 Class C Fixed Rate Notes due 2012 rated "B2"

Moody's noted that the transaction has experienced a reduction in
the amount of indebtedness outstanding due to a partial redemption
of the CDO's most senior indebtedness.  Moody's stated that the
placement on the Moody's watchlist reflects Moody's opinion that
the credit quality of the Class C Notes may be improving.


SITESTAR CORP: Buying Idacomm Internet Assets for $1.698 Million
----------------------------------------------------------------
Sitestar Corporation entered into a Definitive Agreement acquiring
the dial-up internet related assets of Idacomm, Inc., an Idaho
corporation.  The deal consists of the acquisition of the dial-up
customers, select DSL and web hosting customers, the related
internet assets and a non-compete agreement.  The total purchase
was $1,698,000, which represented the fair value of the assets
acquired, net of deferred revenue.  The transaction also consisted
of a non-interest bearing promissory note of $1,698,000 payable
over seven months with the first payment of $250,000 paid at
Closing.

Sitestar Corporation, a holding company, provides Internet and
computer services to business and residential customers primarily
in the United States. The company's services include narrow and
broadband Internet access, toner recharge, custom networking,
technical consulting, ecommerce integration, Web application
development, and commercial-residential Internet services.

                         *     *     *

                      Going Concern Doubt

Bagell, Josephs & Company, L.L.C., the Company's auditor,
expressed substantial doubt in the Company's ability to continue
as a going concern, after it audited the Company's December 31,
2003, and 2004, financial statements, pointing to the Company's
working capital deficit.


SPECTRX INC: June 30 Balance Sheet Upside-Down by $6 Million
------------------------------------------------------------
Spectrx, Inc., reported its financial results for the quarter
ending June 30, 2005.

The Company reported net sales of $269,000 for the three months
ended June 30, 2005 compared with net sales of $272,000 for the
same period in 2004.

Since inception, the Company has financed its operations primarily
though private sales of debt and private and public sales of its
equity securities.  At June 30, 2005, the Company had cash of
approximately $1.0 million and negative working capital of
approximately $3.5 million.  $540,000 of its cash balance at June
30, 2005 was restricted to payment of sub-contractors under the
NIAAA contract.

The Company's major cash flows in the six months ended June 30,
2005 consisted of cash out-flows of $1.8 million from operations
(including $2.4 million of operating loss) and the purchase of
$35,000 of property and equipment and net proceeds of $2.1 million
from the sale of BiliChek assets.

                          Personal Loans

During the quarter ended June 30, 2005, two of the Company's
officers loaned a total of $100,000 to cover short-term cash
needs.  These loans were repaid in the quarter, along with
interest of $1,100.  Also during the second quarter of 2005, one
of the Company's investors loaned the company a total of $80,000
in the quarter, which was repaid during the second quarter of
2005, along with interest of $1,000.

                       Looking for Partners

The Company has historically received funds from milestones and
reimbursements from its collaborative partners.  The Company is
currently seeking a collaborative partner for its glucose
monitoring technology.  Until the Company reaches an agreement
with a new partner, it expects no such milestones or
reimbursements.  The Company has been successful in securing
grants to support some of its programs, including grants totaling
over $2.4 million, to be spent over 2004 and 2005, from the NCI
for our cervical cancer program.

                          Asset Sale

In March 2003, the Company sold the assets related to the BiliChek
products, as non-core assets, for $4.0 million of cash at closing,
an additional $1.0 million upon completion of some component
replacement engineering work, which we received in November 2003,
and up to $6.25 million in earnout payments based upon the future
performance of the business as conducted by the buyer,
Respironics.  The Company received $655,000 of earnout in the
first quarter of 2004 for performance during 2003 and received
approximately $1.0 million of earnout in 2005 for performance
during 2004.

The Company received $700,000 of this earnout in the first quarter
of 2005 and $331,000 of earnout was received in April 2005.  The
Company also received $1.1 million in the second quarter of 2005
as advance against future earnouts.

                    Going Concern Doubt

At June 30, 2005, the Company's current liabilities exceeded
current assets by approximately $3.5 million and the Company has a
capital deficit due principally to recurring losses from
operations.

The Company also initiated litigation against Abbott Laboratories,
Inc., asserting substantial damages and are withholding payment
due under its redeemable preferred stock agreement.  As a
consequence, the Company is in default on payments due under its
settlement with Abbott regarding our redeemable preferred stock
agreement.  These factors raise substantial doubt about our
ability to continue as a going concern.

Eisner LLP also expressed substantial doubt about Spectrx, Inc.'s
ability to continue as a going concern after it audited the
Company's financial statements for the year ended Dec. 31, 2004.

Additional debt or equity financing will be required for the
Company to continue as a going concern.  The Company currently
plans to raise additional funds through financing its accounts
receivable and seeking additional debt funding secured by its
potential BiliChek earnout.

                       Abbott Default

From early 2003 through Feb. 2005, the Company was in negotiations
with Abbott regarding patent issues and payments of "outstanding
accrued dividends" and "redemption" under the settlement.

On July 15, 2004 Abbott sent a letter notifying the Company that
it was in default on two separate payments due in 2004 and
demanding payment.  On July 22, 2004 the Company responded that it
was seeking to resolve the patent issues and renegotiate the
payment terms.  On October 25, 2004, Abbott sent a letter
notifying the Company that it was in default on an additional
payment due in 2004 and demanding payment.  The Company again
responded that it expects to continue to seek to resolve the
patent issues and renegotiate the payment terms.

On February 17, 2005, the Company initiated litigation against
Abbott Laboratories relating to its dispute over intellectual
property issues.  The Company is represented in this matter under
a contingency fee arrangement.  In connection with the dispute and
litigation, the Company has not made the four payments totaling
$1.4 million due in 2004.  On April 6, 2005, Abbott notified the
Company that it considered the Company in default on a total of
$1.4 million.

SpectRx, Inc. (OTCBB: SPRX) is a diabetes management company
developing and providing innovative solutions for insulin delivery
and glucose monitoring.  SpectRx hosts three Web sites at
http://www.spectrx.com/and http://www.mysimplechoice.com/and
http://www.guidedtherapeutics.com/ SpectRx markets the
SimpleChoice(R) line of innovative diabetes management products,
which include insulin pump disposable supplies.  SpectRx also
plans to develop a consumer device for continuous glucose
monitoring.  The company is commercializing its non-invasive
cancer detection technology through subsidiary company Guided
Therapeutics, Inc., which SpectRx intends to separately finance
with private funds.

At June 30, 2005, SpectRx, Inc.'s balance sheet showed a
$6,439,000 stockholders' deficit, compared to a $3,695,000 deficit
at Dec. 31, 2004.


SPIEGEL INC: Johnson & Morris Seek Reconsideration on $912K Claim
-----------------------------------------------------------------
Alfred R. Johnson and Clarence R. Morris ask the U.S. Bankruptcy
Court for the Southern District of New York to reconsider its
April 19, 2005, order disallowing and expunging their claims
against Spiegel Inc. and its debtor-affiliates aggregating
$912,042.

James P. Connors, Esq., at the Law Offices of James P. Connors,
in Columbus, Ohio, asserts that neither Mr. Johnson nor Mr.
Morris was notified of the Debtors' objection to disallow the
Claims and of the Court's order sustaining that objection.
Therefore, Mr. Johnson and Mr. Morris had no opportunity to
oppose the Objection.

Mr. Connors relates that Mr. Johnson and Mr. Morris only learned
of the Objection and Order when they were contacted with an offer
to buy their claims in late June 2005.  Subsequently, Mr. Johnson
has attempted several times to contact the Debtors' bankruptcy
administrator, Kate Mailloux, and their counsel to avoid having
to file a motion for reconsideration.  However, Ms. Mailloux has
not returned any of the calls despite several messages left with
her office.  A staff member of the Debtors' counsel returned a
call and left a message stating that the attorneys no longer had
any responsibility for the case and would not respond to the
issues raised by Mr. Johnson.

"The [D]ebtors obviously knew about both the claims and the
creditors," Mr. Connors argues.  "Their proven failure to serve
the objection or the order demonstrates that [those] actions took
place through no fault of either Mr. Johnson or Mr. Morris."

Moreover, Mr. Connors asserts that the Debtors' Objection is
based on "hearsay and conclusory statements," which have no basis
in fact.  The Debtors relied on the affidavit of declaration
submitted by James Pekarek, who did not offer any evidence based
on personal knowledge and knows virtually nothing about the
claims at issue.  Mr. Connors stresses that any statements by a
person who had no relationship of the Debtors' proceedings or
claims should be stricken and not considered since they form no
evidence on which to sustain judgment.

Furthermore, Mr. Connors tells Judge Lifland that the Debtors and
their affiliates destroyed the Claimants' property and committed
other intentional torts giving rise to significant damages.

Mr. Connors says that shortly before trial of the Claims in the
Franklin County Court of Common Pleas, the Debtors and their
counsel defaulted on the Claims and sent a letter to the Court
advising that they intended to default and did not intend to
defend the Claims asserted against them, thus conceding both
liability and damages.

Mr. Connors maintains that there can be no prejudice when the
result was a calculated intentional act on the Debtors' part.
Mr. Johnson and Mr. Morris also insist that the Debtors be
required to pay the reasonable attorney's fees and expenses
necessary to prepare and file the Motion for Reconsideration
since the Debtors' conduct is what necessitated that action.

                  Spiegel Creditor Trust Responds

Douglas E. Deutsch, Esq., at Chadbourne & Parke LLP, in New York,
vehemently argues that Mr. Johnson and Mr. Morris "place[d] great
weight on the allegation that they did not receive notice of the
Objection, yet they fail[ed] to overcome the presumption of
notice that attaches to a valid affidavit of service."

In addition, Mr. Deutsch contends that although Mr. Johnson and
Mr. Morris assert that excusable neglect authorizes the Court to
reconsider its Order, a review of the factors that are to be
considered before granting a motion to reconsider based on
"excusable neglect" all weigh in favor of the Spiegel Creditor
Trust.

Mr. Deutsch notes that Mr. Johnson and Mr. Morris failed to
explain how the Court should address the clear prejudice caused
by the allowance of the Claims when the Debtors' Plan was
confirmed and neither the Spiegel Creditor Trust nor the
Reorganized Debtors were funded for those Claims.

Mr. Deutsch maintains that Mr. Johnson and Mr. Morris also failed
to address the prejudice to the Creditor Trust in the Debtors'
cases, where 2,504 claims have been expunged.  Reconsidering the
Order may motivate the holders of those expunged claims to flood
the Court with similar motions.

"Finality is required here," Mr. Deutsch says.  Granting the
Motion is potentially dangerous given that the reconsideration is
sought post-effective date against a trust with limited assets.

Furthermore, Mr. Deutsch contends that Mr. Johnson and Mr. Morris
did not address which entity should be liable for their Claims
because the Plan:

   (i) created "Reorganized Debtors" free and clear of all claims
       as provided by Section 1141 of the Bankruptcy Code; and

  (ii) provided that the Creditor Trust is only responsible for
       certain enumerated and identified disputed claims.

"Allowing [Mr. Johnson and Mr. Morris] to proceed with the Claims
at this late stage would upset the careful balance between
creditors' and the Debtors' rights as memorialized in the Plan,"
Mr. Deutsch contends.

Mr. Deutsch asserts that Mr. Johnson and Mr. Morris have also
cited instances of the inadequacy of the details of the Objection
without addressing one fundamental issue regarding their Claims.
Mr. Deutsch glaringly points out that the Claims' sole support is
a judgment against a non-debtor.

According to Mr. Johnson and Mr. Morris, they sued non-debtor
Spiegel Properties, Inc., and Spiegel Management Group, Inc., in
Franklin County, Ohio.  Last year, clearly recognizing that
Spiegel Properties had been liquidated and had not provided any
funds upstream to its parent, the Debtors allowed a default
judgment to be entered against Spiegel Properties.  From that
judgment, Mr. Deutsch notes, Mr. Johnson and Mr. Morris
"miraculously" asserted in their Claims that Spiegel Management
should be liable.  However, Mr. Johnson and Mr. Morris failed to
explain "how a claim against X creates a claim against Y."

Thus, as part of the "excusable neglect" test cited by Mr.
Johnson and Mr. Morris, the Creditor Trust asks Judge Lifland to
deny the Motion for Reconsideration and to review and consider
the merits of the Claims in the Creditor Trust's favor.

          Johnson Insists Reconsideration is Appropriate

Mr. Johnson recounts that Spiegel Management and Spiegel
Properties were named as defendants in the Ohio case by way of a
First Amended Complaint filed on October 29, 2001.  Both Spiegel
entities collectively filed an answer to the First Amended
Complaint on December 19, 2001.  In that action, Mr. Connors
points out that neither Spiegel entity raised a purported defense
that Spiegel Properties was either defunct or insolvent.  Rather,
both Spiegel entities actively and vigorously defended the
action.

With regards to the assertion that Mr. Johnson and Mr. Morris
were served with the Objection, Mr. Connors argues that the
Creditor Trust offers no evidence for that allegation other than
an "affidavit" filed two weeks after the fact.

Mr. Connors tells Judge Lifland that the affidavit offered by the
Debtors is highly questionable, considering that:

   -- it is two weeks late;

   -- it is executed by a person who does not normally provide
      the affidavits for service; and

   -- it was executed on March 10, 2005, but was not filed until
      the end of March.

The affidavit asserts that the notice of the Objection was
enclosed in separate envelopes "to be delivered by first class
mail."  In other words, it does not affirm that the envelopes
were placed in the U.S. Mail, Mr. Connors argues.

The affidavit also contradicts what the Debtors and their counsel
wrote in the Objection concerning service -- that it was served
on Mr. Johnson and Mr. Morris and not their counsel.

Mr. Connors further contends that the Creditor Trust's failure to
timely file a "proper affidavit of mailing" from Ms. Mailloux in
March at the time the Objection was supposedly served
demonstrates that proper procedures were not followed in the
Debtors' case.

The Creditor Trust's allegation regarding the "presumption of
notice that attaches to a valid affidavit of service" fails to
explain how the Court should address "the clear prejudice" caused
by the lack of funding for the Claims, and that other claimants
may be motivated to challenge their disallowed claims, Mr.
Connors asserts.

Mr. Connors insists that in reconsidering the Order, there is no
prejudice to the Debtors because they were on notice, admittedly
since the outset of the State Court Action in 2001, that both Mr.
Johnson and Mr. Morris:

   -- had substantial claims against them, which were actively
      litigated in Ohio for over four years;

   -- initially filed proofs of claims in 2003; and

   -- filed a revised proof of claim in 2004 once judgment was
      rendered in the State Court Action on September 14, 2004.

"The [Creditor] Trust does not dispute or even address these
facts," Mr. Connors avers.

Moreover, Mr. Connors tells Judge Lifland that the quality of
notice given to Mr. Johnson about the bar date should also be
considered in determining the "excusable neglect" issue.

Mr. Connors also says that lack of funds is not a basis for
prejudice by itself, but has resulted from the Debtors' actions.
Based on the Plan's effectivity and the Creditor Trust's recent
application for payment of fees and expenses exceeding
$20 million, it appears that there are ample funds that remain
available to satisfy the Claims.

Mr. Connors further asserts that the Creditor Trust's last
argument -- that it does not know "how a claim against X equates
to a claim against Y" -- is "totally disingenuous and not well
taken."  He maintains that the claims at all times were litigated
and prosecuted against Spiegel Properties and Spiegel Management.
Spiegel actively litigated the claims, and not once did it plead
the insolvency of Spiegel Properties in defense of that action.

"Surely, if Spiegel Properties was insolvent many years prior to
that action, then Spiegel would have allowed a default judgment
instead of spending money and time in defense of the action," Mr.
Connors says.

Mr. Connors maintains that the active litigation of the Claims is
a testament to the validity of the Claims against Spiegel
Management, as well as Spiegel Properties.

Accordingly, Mr. Johnson asks the Court to reconsider its Order
pertaining to the Debtors' Objection in his favor.

Headquartered in Downers Grove, Illinois, Spiegel, Inc. --
http://www.spiegel.com/-- is a leading international general
merchandise and specialty retailer that offers apparel, home
furnishings and other merchandise through catalogs, e-commerce
sites and approximately 560 retail stores.  The Company filed for
Chapter 11 protection on March 17, 2003 (Bankr. S.D.N.Y. Case No.
03-11540).  James L. Garrity, Jr., Esq., and Marc B. Hankin, Esq.,
at Shearman & Sterling, represent the Debtors in their
restructuring efforts.  When the Company filed for protection from
its creditors, it listed $1,737,474,862 in assets and
$1,706,761,176 in debts.  The Court confirmed the Debtors'
Modified First Amended Joint Plan of Reorganization on May 23,
2005.  Impaired creditors overwhelmingly voted to accept the Plan.
(Spiegel Bankruptcy News, Issue No. 52; Bankruptcy Creditors'
Service, Inc., 215/945-7000)


STRATEGY INTERNATIONAL: Posts $3.5M Net Loss in 1st Quarter of '05
------------------------------------------------------------------
Strategy International Insurance Group, Inc., delivered its
quarterly report on Form 10-QSB for the quarter ending July 31,
2005, to the Securities and Exchange Commission on Sept. 23, 2005

For the three months ended July 31, 2005, Company incurred a net
loss of $3,495,222.  For the fiscal year ended April 30, 2005, the
Company reported a $14,958,708 net loss.  The Company also reports
a working capital deficit of $3,839,531 and $982,036 as of July
31, 2005 and April 30, 2005, respectively, and has generated
negative cash flows from operations.

Gross premiums written in the quarter ended July 31, 2005 amounted
to $293,197.  Unearned premiums amounted to $111,909 so that net
earned written premiums totaled $181,288.  Insurance premiums were
earned in these countries:

        Country                        Premiums Earned
        -------                        ---------------
        United Kingdom                     $116,959
        Canada                               19,633
        South East Asia                      44,696
                                        --------------
        Total                              $181,288

The Company expects to generate cash from its operations and from
external investors of its equity securities.  Monthly operating
expenses currently approximate $450,000.

                      Going Concern Doubt

Rotenberg Meril Solomon Bertiger & Guttilla, PC, expressed
substantial doubt about the Company's ability to continue as a
going concern after it audited the Company's financial statements
for the year ended April 30, 2005.  The Firm point to the
Company's operating loss, working capital deficit and negative
cash flows from operations.

                  About Strategy International

Strategy International Insurance Group, Inc., (OTCBB: SGYI) --
http://www.strategyunderwriting.com/-- operates as a holding
company for Strategy Holding Company Limited, which itself
operates as a holding company for Strategy Insurance Limited, a
Barbados-formed and licensed provider of specialty lines of
insurance, reinsurance and structured risk underwriting, focusing
on credit risk and credit enhancement.  Strategy has offices in
Barbados, London and Toronto.

With total assets at July 31, 2005 of $90,356,295 Strategy
International is an integrated, international group of providers
of specialty lines of insurance, reinsurance and structured risk
solutions, focusing on credit enhancement, contingent insurance
products, liability and other specialty insurance and reinsurance
products related directly to the travel and leisure industries.


SUN NETWORK: Going Concern Doubts Continue as Deficits Widen
------------------------------------------------------------
Sun Network Group Inc. delivered its quarterly report on Form 10-Q
for the quarter ending June 30, 2005, to the Securities and
Exchange Commission on Sept. 15, 2005.

At June 30, 2005, the Company reports an accumulated deficit of
$10,305,515 and net losses of $1,859,369.  Working capital of the
Company at June 30, 2005 was $16,267 and cash used in operations
in the six months ended June 30, 2005 was $135,837.

Sun Network Group's investments were funded through a Stock
Purchase Agreement with Dutchess Private Equities Fund II, L.P. to
sell up to $5 million of the Company's common stock over a 24-
month period in accordance with the offering circular under
Regulation E (file number 095-00254).  The Company's president
advanced $40,000 during the fourth quarter of 2004 and $56,500
during the first six months of 2005.  At June 30, 2005, the
Company's cash balance was $62.

                     Going Concern Doubt

Salberg & Company, PA, expressed substantial doubt about the
Company's ability to continue operating as a going concern in
connection with its audit of the Company's financial statements
for the fiscal year ended Dec. 31, 2004.

Salberg & Company pointed to the Company's:

   - nominal revenues.
   - accumulated deficit totaling $8,446,146 at December 31, 2004
   - working capital deficit of $51,011 at December 31, 2004
   - net losses in 2004 of $5,277,784; and
   - need for additional cash to fund operations over the next
     year.

                     About Sun Network

Sun Network Group, Inc., is a business development company
governed under the Investment Company Act of 1940.  Sun seeks out
investment opportunities in early stage and developing companies.

Its first portfolio investment since its election to become a BDC
is Aventura Networks, LLC which operates a VoIP network and sells
VoIP services.  At June 30, 2005, the Company's largest portfolio
investment was Aventura Networks, LLC., totaling $941,102 at
value, or 90.4% of the fair value of Sun Network's investments.

The Company is currently focused on increasing the value of its
investment portfolio and looking for additional investments all
with the goal of returning increased value to its shareholders.

Sun Network Group, Inc. filed for a name change with the State of
Florida on June 3, 2005 but has not consummated this change as the
new name might not coincide with the Company's mission statement.
Until such time as the Company files and receives acceptance of a
new trading symbol from the NASD, the Company will continue to be
known as Sun Network Group, Inc. for reporting purposes.


TERRY LYTLE: Case Summary & 20 Largest Unsecured Creditors
----------------------------------------------------------
Debtor: Terry L. Lytle
        dba American Pool and Spa
        26 Premier Estates
        Humboldt, Tennessee 38343

Bankruptcy Case No.: 05-14343

Type of Business: The Debtor sells and installs pools and spas.

Chapter 11 Petition Date: September 24, 2005

Court: Western District of Tennessee (Jackson)

Judge: G. Harvey Boswell

Debtor's Counsel: Timothy B. Latimer, Esq.
                  Utley & Latimer, P.C.
                  425 East Baltimore
                  Jackson, Tennessee 38301
                  Tel: (731) 424-3315

Total Assets:   $803,300

Total Debts:  $1,131,400

Debtor's 20 Largest Unsecured Creditors:

   Entity                     Nature of Claim       Claim Amount
   ------                     ---------------       ------------
Friendship Bank               Building (Bowling         $345,000
679 W. Church St.             Alley in Humboldt -
Lexington, TN 38351           surrender)
                              Value of security:
                              $249,400

SBA                           Building (Bowling         $210,000
c/o Colson Services           Alley in Humboldt -
P.O. Box 1289                 surrender)
Bowling Green Station         Value of security:
New York, NY 10274            $249,400

First Bank                    House & 4 acres;          $137,000
P.O. Box 388                  1 lot located at 26
Lexington, TN 38351           Premier Estates
                              Value of security:
                              $290,700

Friendship Bank               Restaurant equipment       $61,000
                              & fixtures located in
                              Bowling Alley in
                              Humboldt
                              Value of securiy:
                              $20,000

American Express                                         $18,000

Friendship Bank               1998 JCB 512 Backhoe       $14,000
                              Value of security:
                              $12,000

Chase                                                     $8,800

Beneficial                    Personal loan               $8,000

AMF                           35 cases of                 $5,000
                              bowling pins
                              (surrender)
                              Value of security:
                              $1,000

Citifinancial                                             $4,900

Capital One                                               $4,000

Capital One                                               $3,500

American Express Optima                                   $3,200

Humboldt Utilities            2551 N. Central             $1,500

Citi Card                                                 $1,300

TN Dept. of Revenue           941 taxes                   $1,000

TN Dept. of Revenue           Sales taxes - lien          $1,000
                              on 153 E. Park, Alamo

Verizon Wireless                                          $1,000

Capital One                                                 $950

Home Depot                                                  $600


THERMOVIEW INDUSTRIES: Files Chapter 11 Petition in W.D. Kentucky
-----------------------------------------------------------------
ThermoView Industries, Inc. (Amex: THV) and nine subsidiaries
filed for chapter 11 protection in the U.S. Bankruptcy Court for
the Western District of Kentucky on Sept. 26, 2005.  The
bankruptcy filing was prompted due to increasing pressure from
high debt levels, including senior debt coming due in mid-2006.

The Debtors, which employ over 700 people in 17 states, have been
struggling to overcome these pressures for some time and had
achieved several financial restructures with its senior lenders in
the last two years.  However, recent conditions had made it
impossible to continue operating outside of bankruptcy protection.

"We voluntarily filed for reorganization under Chapter 11 in the
best interests of our customers, suppliers and the 700 families of
our ThermoView employees," ThermoView CEO Charles L. Smith, said.
"It is our intention and belief that we will continue to operate
as near normally as possible during this time.  We will continue
to perform all contracted work and generally do whatever it takes
to make our customers happy.  It is crucial to the success of our
reorganization that we continue our high standards of customer
satisfaction throughout this process.  We look forward to emerging
from this reorganization a stronger company with a promising
future."  Mr. Smith further indicated that it would be contacting
all vendors and other business partners in the very near future
about the details of continuing relationships during and after the
reorganization.

                  Asset Purchase Agreement

The Company enters Chapter 11 with an interested buyer, an
affiliate of Milestone Capital Management, LLC, which has already
executed an Asset Purchase Agreement with the Company, subject to
the auction bidding process and court approval.  The Company also
expects Court approval of a $750,000 loan from an affiliate of
Milestone Capital to shore up its liquidity during the bankruptcy
proceedings.

The Company had been seeking various forms to restructure its
business, including:

   -- an infusion of capital;

   -- a buyout of the senior lenders' positions;

   -- sale of part or all of the company's assets to a strategic
      buyer; or

   -- an internal voluntary restructuring by all stakeholders.

Company officials stated they expect this financial restructuring
to result in ThermoView Industries becoming a stronger, more
efficient company.

"We are thrilled to have the opportunity to work with the
management team of ThermoView to reorganize the company and emerge
from bankruptcy," said Murry N. Gunty, Managing Partner of
Milestone Capital.  "Unfortunately, though the business is very
sound, they were operating under a legacy capital structure that
inhibited the company's performance and opportunities for growth.
Upon completion of the transaction, we look forward to growing the
business with management."

                       AMEX DeListing

ThermoView also stated that its Board of Directors resolved on
Sept. 22, 2005, to inform the American Stock Exchange that
ThermoView would not be able to regain compliance with the
Exchange's continued listing standards within the extension
provided by the Exchange.  ThermoView received notice from
Exchange staff by letter of April 28, 2005, indicating that the
Company was below certain of the Exchange's listing standards.
ThermoView was granted the opportunity to submit a plan of
compliance to the Exchange, and on May 31, 2005, presented its
plan to the Exchange.  In a June 28, 2005 letter, the American
Stock Exchange accepted ThermoView's plan of compliance and
granted the Company an extension of time to regain compliance.
However, the Company has informed the Exchange of its inability to
regain compliance with the continued listing standards.  Recent
charges for impairment of goodwill, as well as the Chapter 11
reorganization, ultimately necessitated this decision.
The Company expects the Exchange to begin delisting procedures
immediately.

                    Going Concern Doubt

The Company previously received a going concern opinion from its
auditors, Crowe Chizek and Company, LLC, in its financial
statements for the year ended Dec. 31, 2004.  The auditing firm
points to the Company's significant losses that could bring about
defaults in its debt agreements.

At June 30, 2005, ThermoView Industries Inc.'s balance sheet
showed a $13,108,879 stockholders' deficit, compared to a
$3,629,228 deficit at Dec. 31, 2004.

Milestone Capital Management, LLC -- http://www.milestonedc.com/
-- is a Washington, DC based private equity firm with $88 million
of capital under management.  Milestone seeks investments in a
range of industries, including manufacturing, distribution, health
care, restaurants and specialty retail.

Headquartered in Louisville, Kentucky, ThermoView Industries, Inc.
-- http://www.thv.com/-- is a national company that designs,
manufactures, markets and installs high-quality replacement
windows and doors as part of a full-service array of home
improvements for residential homeowners.  The Company and its
subsidiaries filed for chapter 11 protection on Sept. 26, 2005
(Bankr. W.D. Ky. Case Nos. 05-37123 through 05-37132).  David M.
Cantor, Esq., at Seiller-Handmaker, LLC, represents the Debtors in
their restructuring efforts.  When the Debtors filed for
protection from their creditors, they listed $3,043,764 in total
assets and $34,104,713 in total debts.


THERMOVIEW INDUSTRIES: Case Summary & 40 Largest Unsec. Creditors
-----------------------------------------------------------------
Lead Debtor: ThermoView Industries Inc.
             5611 Fern Valley Road
             Louisville, Kentucky 40228

Bankruptcy Case No.: 05-27123

Debtor affiliates filing separate chapter 11 petitions:

      Entity                                     Case No.
      ------                                     --------
      Leingang Siding and Window Inc             05-37124
      Primax Window Co.                          05-37125
      Rolox Inc                                  05-37126
      Thermal Line Windows Inc                   05-37127
      ThermoView Industries Inc of California    05-37128
      Thomas Construction Inc                    05-37129
      Thermo-Shield of America (Arizona), Inc.   05-37130
      Thermo-Shield of America (Michigan), Inc   05-37131
      Thermo-Shield Company LLC                  05-37132

Type of Business: The Debtor designs, manufactures, markets
                  and installs high-quality replacement windows
                  and doors as part of a full-service array of
                  home improvements for residential homeowners.
                  See http://www.thv.com/

Chapter 11 Petition Date: September 26, 2005

Court: Western District of Kentucky (Louisville)

Judge: Joan L. Cooper

Debtors' Counsel: David M. Cantor, Esq.
                  Seiller Handmaker, LLC
                  462 South, 4th Avenue, Suite 2200
                  Louisville, Kentucky 40202
                  Tel: (502) 584-7400

                                    Total Assets    Total Debts
                                    ------------    -----------
ThermoView Industries Inc             $3,043,764    $34,104,713

Leingang Siding and Window Inc          $895,039    $17,761,389

Primax Window Co.                     $1,661,968    $18,373,053

Rolox Inc                             $1,072,469    $18,064,413

Thermal Line Windows Inc              $2,752,657    $17,950,661

ThermoView Industries Inc             $1,087,679    $17,880,313
of California

Thomas Construction Inc               $2,352,296    $19,775,027

Thermo-Shield of America                      $0    $16,853,406
(Arizona), Inc.

Thermo-Shield of America                      $0    $16,853,406
(Michigan), Inc

Thermo-Shield Company LLC               $426,977    $17,146,962


Debtors' Consolidated List of 40 Largest Unsecured Creditors:

   Entity                                      Claim Amount
   ------                                      ------------
   GE Capital Equity Investments Inc.           $12,755,928
   120 Long Ridge Road
   Stamford, CT 06927

   Stephen A. Hoffman                            $1,284,962
   2631 Bushwood Road
   Louisville, KY 40223

   Winchester Indurstries Inc.                     $772,961
   P.O. Box 280
   Indiana, PA 15701

   Dart Investors                                  $555,553
   13397 Lakefront Drive
   Earth City, MO 63045

   Nelson Clemmons                                 $500,000
   2003 Goshen Lane
   Goshen, KY 40028

   Douglas Maxwell                                 $500,000
   300 Mockingbird Gardens
   Louisville, KY 40207

   Cardinal Building Material Inc.                 $414,798
   3634 Pennridge
   Bridgeton, MO 63044

   Great Lakes Window Corp.                        $398,572
   30499 Tracy Road
   Walbridge, OH 43465

   Charles L. Smith                                $307,171
   P.O. Box 1589
   Orange Grove, TX 78372

   Roycom Limited                                  $245,189

   Great Central Lumber                            $207,622

   Prolux LC - Stl                                 $187,396

   Cardinal CG                                     $185,108

   Robert L. Cox                                   $163,389

   Complast Inc.                                   $139,406

   Rosner Law & Mansfield                          $121,909

   Shelter                                         $110,556

   Noradex, Inc.                                   $108,807

   Robert L. Cox, II                                $98,033

   Allied Building Products Corp.                   $95,477

   Cardinal Printing Co.                            $78,414

   BWE Construction Co.                             $72,243

   Decore-ative Specialities                        $70,153

   BB&T                                             $68,351

   Hygrade Metal Moulding Mfg.                      $67,987

   Home Depot                                       $66,747

   Mitchell W. Wexler, Trustee                      $65,356

   Imperial Plastics, Ltd.                          $61,524

   Mission Valley Cabinet                           $58,450

   Lowe's Companies, Inc.                           $57,465

   Louisville Premium Finance Co.                   $56,250

   Joyce Manufacturing Co.                          $55,071

   Wholesale Plumbing Supply                        $51,571

   Textured Coating of America, Inc.                $46,374

   Affinity Insurance Ltd.                          $46,356

   Lami Wood Products                               $42,205

   Emerging Business Solutions                      $32,678

   Northern State Metal Inc.                        $31,836

   Chic Lumber & Hardware                           $29,491

   Alside Supply Center - Louisville                $25,001


UAL CORP: Court Authorizes MyPoints KERP Implementation
-------------------------------------------------------
UAL Corporation and its debtor-affiliates are in the process of
marketing their business unit, MyPoints.com.  To maximize the sale
price, the Debtors must retain current management throughout the
marketing and sales process.  With the assistance of employee
benefits advisor Towers Perrin, the Debtors developed a key
employee retention program for MyPoints employees.

According to James H.M. Sprayregen, Esq., at Kirkland & Ellis, in
Chicago, Illinois, the MyPoints KERP provides cash retention
award payments that will encourage key employees to remain with
MyPoints and obtain the most attractive sale terms.

Participation in the MyPoints KERP is limited to nine
individuals, Mr. Sprayregen explains.

The proposed structure of the MyPoints KERP has three elements:

   (1) Retention Payment

       The Retention Payment will be equal to 50% of annual
       salary for individuals deemed critical to the sales
       process.  The Retention Payment will be paid in two
       installments, half at the closing of the sale and the
       other half at the earlier of six months post-closing or
       termination of the individual by the purchaser.

   (2) Severance Payment

       The Severance Payment, equal to 50% of the individual's
       base salary, will be paid to seven individuals if MyPoints
       is sold and that individual's employment is terminated.

   (3) Sales Incentive

       Sales Incentives will be paid to MyPoints employees with
       the greatest impact on the sale price.  The amount of the
       Sales Incentive will depend on the MyPoints' sale price
       and will only be triggered if the price tag exceeds
       $21,000,000.  The Sales Incentive will increase
       incrementally from 0.25% to 5.0% of the incremental value
       of MyPoints above $11,000,000.  For example, if the
       MyPoints sale price is increased from $21,00,000 to
       $31,000,000, the incremental incentive would equal
       $1,050,000.  The percentage share will remain unchanged
       if MyPoints is sold for over $51,000,000.

                     KERP Must Be Approved

Mr. Sprayregen states that the MyPoints KERP is a product of the
Debtors' business judgment and is fair and reasonable.  Each of
the elements in the MyPoints KERP is commonly used to retain key
employees and to motivate management to maximize the sale price.
The total severance and retention costs for the sale of a
business are usually 3% to 5% of the expected sales price.  Under
the MyPoints KERP, severance and retention costs range from 1.1%
to 2.7%.  Total severance and retention rewards under the
MyPoints KERP could total $570,000.

The Debtors, therefore, seek the Court's authority to implement
the MyPoints KERP.

                         Parties Object

Matthew E. Babcock, Esq., at Guerrieri, Edmond, Clayman & Bartos,
in Washington, D.C., counsel to the Association of Flight
Attendants-CWA, AFL-CIO, notes that since the Petition Date, the
Debtors have laid off "tens of thousands" of employees.  For the
employees who have remained, their financial security has
steadily eroded.

Over the course of the bankruptcy, union-represented employees
have provided over $3,200,000,000 in annual wage, benefit and
work rule concessions, including $440,000,000 in annual
concessions from the Flight Attendants.  Each concession was met
with assurances that all of the Debtors' employees, including
management, were sharing the pain.

Against this backdrop of employee sacrifice and suffering, the
Debtors ask the Court to approve the MyPoints KERP, which could
pay out over $650,000, with proposed bonuses of over $500,000 for
unnamed "individuals."  Mr. Babcock says the Debtors do not
identify the eligible participants in the MyPoints KERP, nor how
the sale incentives would be distributed among participants.

The Court cannot determine whether the MyPoints KERP is necessary
because the Debtors have not identified by name, position or job
classification, any of the prospective participants, Mr. Babcock
contends.  It is not clear whether the prospective KERP
participants are employees or consultants, as the Debtors refer
to potential recipients simply as "individuals."  Mr. Babcock
wonders if the proposed participants are crucial employees that
are likely to search for other employment, or simply managers
seeking financial security.

The International Association of Machinists and Aerospace
Workers, AFL-CIO, supports the AFA's objection, says Sharon L.
Levine, Esq., at Lowenstein Sandler, in Roseland, New Jersey.

                        Debtors Respond

A quick and orderly sale of the MyPoints business unit will
require the full support and dedication of select MyPoints
employees, Marc Kieselstein, Esq., at Kirkland & Ellis, in
Chicago, Illinois, tells Judge Wedoff.

Mr. Kieselstein explains that the MyPoints KERP encourages key
individuals to help obtain the highest sale price for the
business.  The Debtors consulted with their employee benefits
advisor, Towers Perrin, and concluded that the MyPoints KERP is
in the best interests of the estates.

Since filing the KERP Motion, the Debtors have worked diligently
with the Official Committee of Unsecured Creditors to resolve
concerns about the MyPoints KERP.  The Debtors have modified the
MyPoints KERP to resolve these concerns so that:

   1) the Creditors' Committee's failure to object to the
      MyPoints KERP is not a waiver or a precedent for any other
      employee or management incentive programs;

   2) the Debtors will condition each participant's benefits
      under the MyPoints KERP on these factors:

         a) each participant must waive his or her rights under
            any other severance program or non-ordinary course
            incentive compensation as an employee or consultant
            of MyPoints, the Debtors or affiliates;

         b) the MyPoints KERP will be terminated if MyPoints is
            not sold by June 15, 2006;

         c) the MyPoints KERP sale that triggers benefits under
            the KERP excludes the sale of a MyPoints subsidiary;

         d) the professionals  of the Creditors' Committee will
            review the MyPoints KERP to ensure that its terms are
            consistent with the related Court order; and

         e) the Creditors' Committee reserves its rights if the
            MyPoints KERP's terms are inconsistent with the Court
            order.

   3) the Debtors will enter into six-month or greater
      restrictive covenants, including a non-compete, non-
      solicitation, non-disparagement and confidentiality
      agreements with individuals participating in the severance
      portion of the MyPoints KERP; and

   4) for individuals not participating in the severance portion
      of the MyPoints KERP, the Debtors will enter into greater
      than one-year restrictive covenant agreements, applicable
      only if participants receive more than the $500,000 success
      bonus.

Mr. Kieselstein says the modifications strike the right balance
between the need to retain certain MyPoints employees to maximize
the sale price, and the Creditors' Committee's concern that the
KERP creates the right incentives.

The AFA argues that the MyPoints KERP should not provide
incentive awards over $500,000.  Mr. Kieselstein explains that
the AFA's objection misses the point of the MyPoints KERP.  With
the exception of the $75,000 in retention awards, the MyPoints
KERP only rewards individuals:

      -- with a success bonus if MyPoints is sold above a
         threshold amount; and

      -- with a severance payment if they are terminated not
         for cause.

It is misleading to say the Debtors are harming the estate when
they are attempting to bring more value into the estate by
offering incentives to individuals who are responsible for
increasing the sale value of the MyPoints business.

Mr. Kieselstein notes that MyPoints is a small business with
about 100 employees.  The Debtors have a duty to protect the
confidentiality of the names and titles of the MyPoints KERP's
individual participants.  The Debtors fully described the
categories of participants entitled to the compensation awards
under the MyPoints KERP and provided the names to the Committee
on a confidential basis.

                          *     *     *

Judge Wedoff authorizes the Debtors to implement the MyPoints
KERP.

Headquartered in Chicago, Illinois, UAL Corporation --
http://www.united.com/-- through United Air Lines, Inc., is the
holding company for United Airlines -- the world's second largest
air carrier.  The Company filed for chapter 11 protection on
December 9, 2002 (Bankr. N.D. Ill. Case No. 02-48191).  James H.M.
Sprayregen, Esq., Marc Kieselstein, Esq., David R. Seligman, Esq.,
and Steven R. Kotarba, Esq., at Kirkland & Ellis, represent the
Debtors in their restructuring efforts.  When the Debtors filed
for protection from their creditors, they listed $24,190,000,000
in assets and $22,787,000,000 in debts.  (United Airlines
Bankruptcy News, Issue No. 101; Bankruptcy Creditors' Service,
Inc., 215/945-7000)


UAL CORP: Wants to Walk Away from Sky Chefs & Detroit Leases
------------------------------------------------------------
United Air Lines, Inc., is the counterparty for the Flight
Kitchen Sublease with Sky Chefs, Inc.

United also leased space at the Smith Terminal, Mezzanine Level,
at the Detroit Metropolitan Wayne County Airport.

The Debtors have abandoned the Flight Kitchen Sublease as well as
the Air Cargo space in the Detroit Airport.

For these reasons, the Debtors want to walk away from their
lease:

   * for space located at the Miami International Airport with
     Sky Chefs; and

   * with the Detroit Airport.

The Debtors believe that the rejection of the leases is in the
best interests of their estates, creditors and other parties-in-
interest.  The resultant savings from rejection of the lease will
favorably affect the Debtors' cash flow and assist in managing
future operations.

Headquartered in Chicago, Illinois, UAL Corporation --
http://www.united.com/-- through United Air Lines, Inc., is the
holding company for United Airlines -- the world's second largest
air carrier.  The Company filed for chapter 11 protection on
December 9, 2002 (Bankr. N.D. Ill. Case No. 02-48191).  James H.M.
Sprayregen, Esq., Marc Kieselstein, Esq., David R. Seligman, Esq.,
and Steven R. Kotarba, Esq., at Kirkland & Ellis, represent the
Debtors in their restructuring efforts.  When the Debtors filed
for protection from their creditors, they listed $24,190,000,000
in assets and $22,787,000,000 in debts.  (United Airlines
Bankruptcy News, Issue No. 101; Bankruptcy Creditors' Service,
Inc., 215/945-7000)


UNIFI INC: S&P Junks Corporate Credit & Sr. Unsecured Debt Ratings
------------------------------------------------------------------
Standard & Poor's Ratings Services lowered its corporate credit
and senior unsecured debt ratings on Unifi Inc., to 'CCC+' from
'B-'.

The outlook is negative.  Greensboro, North Carolina-based Unifi
had about $295 million of debt outstanding on March 27, 2005.

"The downgrade reflects our expectation that financial results
will be pressured due to continued escalating raw material costs,
in particular petroleum-based chemical derivative products, which
account for a significant portion of the company's cost
structure," said Standard & Poor's credit analyst Susan Ding.

Hurricane Katrina has accelerated the raw material cost increases
in the short term, and it is uncertain when these costs will
stabilize.  In addition, the difficult operating environment and
adverse market conditions, characterized by excess industry
capacity and a shrinking domestic customer base, have led to
negative unit volume and pricing trends.


UNOVA INC: Debt Reduction Cues Fitch to Raise IDR to BB- from B-
----------------------------------------------------------------
Fitch has upgraded UNOVA, Inc.'s issuer default rating to 'BB-'
from 'B-', senior unsecured debt to 'BB-' from 'B-', and the
company's bank credit facility to 'BB+' from 'BB-'.  In addition,
Fitch has withdrawn the 'R1' recovery rating for the company's
bank credit facility and the 'R4' rating for the senior unsecured
debt.  The Rating Outlook is Stable.

Fitch's rating actions reflect UNOVA's strengthening credit
metrics driven by debt reduction and the solid operating
performance of its wholly owned subsidiary Intermec Technologies
Corporation.  Fitch believes UNOVA has considerable potential for
earnings growth and margin expansion arising from the monetization
of Intermec's RFID patent portfolio following the successful
conclusion of its Rapid Start Licensing Program on Aug. 31, 2005.
Furthermore, Intermec is well positioned to benefit from the
strong market growth for Automated Information and Data Collection
products and services, especially radio frequency identification
devices, as a result of its broad product and patent portfolios.

Fitch views the company's divestiture of the Cincinnati Lamb
division on April 3, 2005 for $65.1 million, including $39.1
million of pension and post-retirement liabilities assumed by the
buyer, as a positive, given its operating losses and significantly
greater working capital requirements relative to the Intermec
segment, which increased the volatility of UNOVA's consolidated
free cash flow.

Although Landis Grinding Systems, the remaining business in the
Industrial Automation Systems segment, has performed well
financially, Fitch views its pending divestiture as a positive
given the limited synergies between Landis and Intermec, and
management's ability to focus its time and financial resources
solely on the higher growth Intermec business.  Fitch's ratings
upgrade anticipates that Landis will be sold in the fourth quarter
of 2005 or early 2006.

Fitch's rating concerns consist of the strong competition from
traditional bar code companies and new entrants, which include
larger, better capitalized companies intent on capitalizing on the
expected strong growth of the AIDC market, uncertainty regarding
the extent to which the transition to RFID could potentially
cannibalize Intermec's existing bar code business, and risks of
rapid technological change in the AIDC industry as RFID standards
evolve or alternate technologies emerge.  These risks are
mitigated by Intermec's significant product and patent portfolios,
supply chain expertise cultivated through years of bar code
technology deployments, ability to leverage existing customer
relationships if they desire to transition to RFID from bar code,
and strong brand name in the AIDC market.

Credit protection measures continue to improve as a result of debt
reduction funded by asset sales and free cash flow, which has been
driven by the strong operating performance of Intermec.  Leverage
(total debt/operating EBITDA), excluding volatile intellectual
property (IP) sales and settlements, declined to 1.6 times (x) for
the latest 12 months (LTM) ended July 3, 2004, from 3.4x and 5.5x
in 2004 and 2003, respectively.  Interest coverage (operating
EBITDA/interest expense), excluding IP sales and settlements,
improved to 4.7x for the LTM ended July 3, 2005 from 3.7x and 2.2x
in 2004 and 2003, respectively.  Both leverage and coverage have
improved significantly from three-year lows of 31x and 0.3x,
respectively, in 2002.  Fitch expects these metrics will continue
to improve as a result of increased profitability, with minimal
near-term debt reduction.

The company's liquidity at July 3, 2005 consisted of $173 million
in cash and cash equivalents, free cash flow before discontinued
operations of approximately $49 million in the LTM ended July 3,
2005, compared with $29.2 million in 2003, a $100 million asset-
based revolving credit facility (U.S. facility) that expires
September 2007 and a BP15 million (US$26.7 million) U.K. revolving
facility.  As of July 3, 2005, no borrowings were outstanding
under either facility, but UNOVA had borrowing capacity of only
$30.5 million under the U.S. facility and $7.8 million under the
U.K. facility due to outstanding letters of credit.  In addition,
the company expects to receive cash proceeds from the sale of
Landis in the fourth quarter of 2005.  Fitch believes that UNOVA
has more than sufficient liquidity and financial flexibility to
meet operational requirements and satisfy its next debt maturity
in March 2008.

As of July 3, 2005, total debt was $108.5 million, down from
$208.5 million at year-end 2004 and $448.9 million at year-end
2000.  The company redeemed an $8.5 million industrial revenue
bond upon maturity in July 2005, reducing total debt to $100
million.  The company's sole remaining outstanding debt issue,
consisting of $100 million of 7% senior unsecured notes, matures
in March 2008.


USG CORP: Futures Rep. Wants to Hire Michael Crames as Advisor
--------------------------------------------------------------
The Official Representative for Asbestos Personal Injury Claimants
appointed in USG Corporation and its debtor-affiliates' chapter 11
cases, Dean M. Trafelet, seeks authority from the U.S. Bankruptcy
Court for the District of Delaware to retain Michael J. Crames,
Esq., of Peter J.  Solomon, L.P., as his advisor, nunc pro tunc to
July 18, 2005.

The Futures Representative informs the Court that immediately
before joining P.J. Solomon, Mr. Crames was a special counsel at
Kaye Scholer LLP and was an integral part of the team
representing the Futures Representative in the Debtors' Chapter
11 cases.  As a result of Mr. Crames' extensive experience and
active involvement, the Futures Representative believes that it
is important that he continue to provide advice in connection
with the Debtors' cases.

As the Futures Representative's advisor, Mr. Crames' compensation
will be no greater than it was while he was at Kaye Scholer.
Thus, there will be no net increase in the cost to the Debtors'
estates as a result of his engagement.  Moreover, the Futures
Representative will ensure that he and his other professionals
carefully coordinate so as to avoid any duplication of effort.

Under a fee arrangement, Mr. Crames' compensation will accrue at
the rate of $10,000 per month, subject to an annual $120,000 cap,
provided:

   (a) that the Futures Representative and Mr. Crames will confer
       on a monthly basis to determine the reasonable value of
       Mr. Crames' services for the previous month;

   (b) if the value of Mr. Crames' services for the past month is
       determined to be less or more than $10,000, that shortfall
       will be carried over to the succeeding months until year-
       end; and

   (c) that each month, Mr. Crames will be entitled to be paid a
       sum equal to the Base Rate less any existing shortfall or
       plus any existing surplus.

Mr. Crames will also be reimbursed for necessary out-of-pocket
expenses incurred.

Given the relatively small compensation amount, the Futures
Representative further seeks the Court's authority to:

   -- pay the compensation on the submission of monthly fee
      statements;

   -- determine that the compensation and reimbursement payments
      due to Mr. Crames are entitled to priority as
      administration expenses, and those payments will be
      entitled to the benefits of any "carve outs" for
      professionals' fees and expenses in effect in the Debtors'
      cases; and

   -- modify the requirement of filing fee applications under
      Section 331 of the Bankruptcy Code so that all interim
      applications will be required to be filed annually rather
      than monthly.

The Futures Representative says that to require the filing of fee
applications under those circumstances would result in a needless
expenditure of estate funds, as the cost of preparation and
filing of those applications is borne by the Debtors' estates.

Mr. Crames assures the Court that neither he nor P.J. Solomon
represents any interest materially adverse to the interests of
the Futures Representative, the Debtors or their estates.  In
addition, he and the firm are each a "disinterested person" as
that term is defined in Section 101(14) of the Bankruptcy Code.

Headquartered in Chicago, Illinois, USG Corporation --
http://www.usg.com/-- through its subsidiaries, is a leading
manufacturer and distributor of building materials producing a
wide range of products for use in new residential, new
nonresidential and repair and remodel construction, as well as
products used in certain industrial processes.  The Company filed
for chapter 11 protection on June 25, 2001 (Bankr. Del. Case No.
01-02094).  David G. Heiman, Esq., and Paul E. Harner, Esq., at
Jones Day represent the Debtors in their restructuring efforts.
When the Debtors filed for protection from their creditors, they
listed $3,252,000,000 in assets and $2,739,000,000 in debts.  (USG
Bankruptcy News, Issue No. 94; Bankruptcy Creditors' Service,
Inc., 215/945-7000)


USGEN NEW ENGLAND: Inks Pact Resolving ET Power's & ET Gas' Claims
------------------------------------------------------------------
Pursuant to a host of agreements among USGen New England, Inc.,
and its affiliates, various amounts were owed to NEGT Energy
Trading-Power, L.P. formerly known as PG&E Energy Trading Power,
L.P., and due from USGen, and vice versa, with respect to
approximately 33,000 separate trades and other transactions.  In
anticipation of each of their Chapter 11 filings, ET Power and
USGen entered into a mutual release on July 3, 2003.  The Mutual
Release contemplated the orderly termination and liquidation of
all agreements between the parties and settlement of those
positions on an equitable basis, subject to further scrutiny by
creditors and, to the extent required, the Court.

Pursuant to the Mutual Release, ET Power and USGen released one
another with respect to the trades and other transactions, and
USGen's payment obligation to ET Power was netted out and fixed
at $81,886,746.

Before the Petition Date, ET Power, on behalf of itself and
USGen, posted certain cash collateral with ISO-New England, Inc.,
in support of transactions with ISO-NE.  By separate stipulation
and consent order, USGen and ISO-NE have agreed on a global
settlement whereby ISO-NE will continue to retain possession of
the ET Power Collateral and, subject to certain contingencies,
may be entitled to apply same in satisfaction of ISO-NE's claims
against USGen and ET Power.

On July 27, 2004, ET Power filed Claim No. 407 alleging claims,
rights and remedies against USGen in connection with intercompany
balances for $251,968,129, plus all amounts for any contingent or
unliquidated claims.

On the same day, NEGT Energy Trading-Gas Corporation filed Claim
No. 408 against USGen for $2,601,425, plus all amounts for any
contingent or unliquidated claims.

USGen objected to the ET Power Claim and the ET Gas Claim because
these were the subject of and subsumed by the Mutual Release.
Furthermore, USGen argued that those claims fail to properly take
into account certain of the parties' intercompany trades,
receivables, payables and other obligations that should be offset
and netted out.

USGen has acknowledged liability with respect to the ET Power
Claim for $81,886,746, and USGen continues to dispute any
liability to ET Power and ET Gas in excess thereof.

After lengthy negotiations, USGen, ET Power and ET Gas want to
resolve and fix the ET Gas Claim and the ET Power Claim in a
cost-effective and efficient manner.  Accordingly, in a Court-
approved Stipulation, the parties agree that:

   a. Claim No. 407 will be reduced and treated as an Allowed
      Class 3 Claim under USGen's Plan for:

      (1) $81,886,746, plus Postpetition Interest, or Modified
          Postpetition Interest, as the case may be, accruing
          through the Distribution Date; and

      (2) an amount not to exceed $25,000,000 from the Disputed
          Claim Reserve, plus Postpetition Interest, or Modified
          Postpetition Interest, as the case may be, accruing
          through the Distribution Date.

      USGen will fund the Disputed Claims Reserve with
      $25,000,000 -- plus an additional $1,635,000 as a reserve
      for Postpetition Interest thereon;

   b. Claim No. 408 will become an Allowed Class 3 Claim under
      USGen's Plan only to the extent and as may be fixed by
      final order of the Court or as otherwise mutually agreed by
      the parties, and will be paid solely from the ET Power/ET
      Gas Reserve provided, however, that the ET Power and ET Gas
      Disputed Claims, if allowed, will in the aggregate not
      exceed the amount of the ET Power/ET Gas Reserve;

   c. The maximum aggregate amount paid by USGen to ET Power and
      ET Gas with respect to Claim Nos. 407 and 408, inclusive of
      interest, will in no event exceed $115,000,000; and

   d. Without further delay, USGen will pay to ET Power
      $1,140,670, whereupon ET Power will be deemed to have
      assigned any and all of its rights in and to the ET Power
      Collateral to USGen.

Headquartered in Bethesda, Maryland, USGen New England, Inc., an
affiliate of PG&E Generating Energy Group, LLC, owns and operates
several electric generating facilities in New England and
purchases and sells electricity and other energy-related products
at wholesale.  The Debtor filed for Chapter 11 protection on July
8, 2003 (Bankr. D. Md. Case No. 03-30465).  John E. Lucian, Esq.,
Marc E. Richards, Esq., Edward J. LoBello, Esq., and Craig A.
Damast, Esq., at Blank Rome, LLP, represent the Debtor in its
restructuring efforts.  When it sought chapter 11 protection, the
Debtor reported assets amounting to $2,337,446,332 and debts
amounting to $1,249,960,731.  The Debtor filed its Second Amended
Plan of Liquidation and Disclosure Statement on March 24, 2005
(PG&E National Bankruptcy News, Issue No. 49; Bankruptcy
Creditors' Service, Inc., 215/945-7000)


VALHI INC: Fitch Retains BB- Rating on Senior Secured Debt
----------------------------------------------------------
Fitch Ratings has affirmed Valhi, Inc.'s senior secured credit
rating at 'BB-' and senior unsecured (implied) rating of 'BB-'.

Fitch also has affirmed Kronos International, Inc.'s senior
secured debt rating of 'BB'.  Additionally, Fitch has assigned a
'BB+' to KII's EUR 80 million senior secured credit facility.  The
Rating Outlook for both Valhi and KII remains Stable.

The Stable Rating Outlook reflects the likelihood that Valhi's
near-term financial performance and debt levels should remain
steady as TiO2 business conditions improve.  TiO2 prices are up
year-over-year.  Supply constraints are likely to keep the market
tight during the second half of the year.  Producers may be able
to push prices higher depending on how strong demand is in the
second half of 2005 and next year.  No major TiO2 production
additions are planned in the near term.

Valhi's ratings are supported by its ownership in diverse
businesses, specifically its significant ownership of Kronos
Worldwide, Inc., and its strong operating margins and market
position as a TiO2 producer.  The rating rationale also
incorporates Valhi's complex corporate structure, dependence on
dividends from affiliates, fundamentally acquisitive strategy and
dividend policy.  Credit strengths include Valhi's sufficient
liquidity of $120 million at June 30, 2005, comprised of $23
million cash at the parent level and $97 million available under
its undrawn senior secured credit facility.  Additionally, Valhi
has no significant near-term maturities of long-term debt until
2009.

Valhi's free cash flow (defined as cash flow from operations less
capital expenditures and dividends) was negative $38 million for
the latest 12 months ending June 30, 2005.  The negative free cash
flow was primarily driven by higher working capital needs, which
used approximately $35 million during the period.  In addition,
income taxes, dividends and capital expenditures were up during
the first half of 2005.  Valhi's senior secured credit facility
contains limitations on restricted payments, including dividends
and share repurchases; however, Fitch considers these credit
provisions to be relatively loose.  The senior secured credit
facility expires in October 2005 and Fitch expects the facility
will be renewed during the fourth quarter.

KII's credit ratings incorporate its strong market position in
Europe, strong profitability and cash flow.  In the current
favorable pricing environment for TiO2, Fitch expects cash flow to
improve in the near term.  Free cash flow was $53 million for the
LTM ending June 30, 2005.  The last couple of years KII's free
cash flow has been steady at the $50 million level.

KII's indenture for the outstanding senior secured notes includes
limitations on restricted payments and at June 30, 2005, KII had
the ability to declare approximately $84 million in dividends.  No
dividends were declared during the first half of 2005.  The credit
ratings could be negatively affected by dividends paid, if they
are not supported by operational cash flow.  The company's
liquidity was adequate with $10 million in cash and $95 million
available under its undrawn senior secured credit facility at June
30, 2005.

In general, titanium dioxide pricing has trended higher in the
last year.  Valhi's TiO2 prices in billing currencies were up
approximately 10% in the first half of 2005 compared to the same
period last year, even though sales volume was down approximately
7%.  This decline in sales volume in the first half of 2005 is
compared to a very strong first half last year.  The painting and
coating season this past spring was not as strong as originally
expected; however, volumes increased sequentially in the second
quarter of 2005 compared to the first quarter.

More recently titanium dioxide supply has been affected by
hurricane Katrina. E.I Dupont de Nemours and Company, the world's
largest supplier of titanium dioxide has declared force majeure
due to the shutdown of its DeLisle, Mississippi plant.  The plant
could be shutdown for possibly three months due to substantial
electrical damage as a result of the flooding at the facility.
The DeLisle plant accounts for approximately 27% of DuPont's
global production capacity and 16% of North American production
capacity.  This loss of production is occurring as the industry
typically realizes a seasonal slowdown; however, with low
inventory levels for the industry, pricing should remain firm.  If
demand growth continues, then the more likely scenario is that
producers will benefit from the tightness in the market and gain
pricing momentum.

For the LTM ending June 30, 2005, credit statistics for Valhi and
KII remain sufficient for the rating category with EBITDA-to-
interest incurred of 3.8 times (x) and 3.8x, respectively.
Valhi's balance sheet debt at the end of the second quarter was
approximately $712 million of which $461 million resides at KII.
Valhi and KII had a debt-to-EBITDA ratio of 2.8x and 2.9x,
respectively, for the LTM ending June 30, 2005.  Total adjusted
debt-to-EBITDAR ratios, incorporating gross rent, for Valhi and
KII were 3.0x and 3.2x, respectively for the same period.

Kronos International, Inc. is Europe's second largest producer of
TiO2 pigments.  The company is a wholly owned subsidiary of Kronos
Worldwide, Inc., a holding company which has additional ownership
interests in certain North American TiO2 producers.  TiO2 pigments
are used in paints, paper, plastics, fibers and ceramics.  KII
generated approximately $845 million of sales and reported EBITDA
of approximately $158 million for the trailing 12-months ending
June 30, 2005.

Valhi is a holding company with direct and indirect ownership
stakes in: NL Industries and Kronos Worldwide, Inc., producers of
TiO2 pigments; CompX, a producer of locks and ball bearing slides,
serving the office furniture industry; TIMET, a producer of
titanium metals products; and Waste Control Specialists, a
provider of hazardous waste disposal services.  Valhi generated
$1.41 billion of sales and approximately $257 million of EBITDA
for the LTM ending June 30, 2005.  Kronos Worldwide, Inc. is the
fifth-largest TiO2 producer in the world and has a significant
presence in Europe, through its operating subsidiary, KII.


VARIG S.A.: Brazilian Bankruptcy Judge Teams Up With Judge Drain
----------------------------------------------------------------
Judge Sergio Cavalieri, President of the Courts of Justice of the
State of Rio de Janeiro, appoints Judge Marcia Cunha Silva de
Carvalho of the Commercial Bankruptcy and Reorganization Court to
coordinate with Judge Drain of the United States Bankruptcy Court
for the Southern District of New York in dealing with Viacao
Aereas Rio-Grandense, S.A.'s bankruptcy proceedings.

Judge Cavalieri directs Judge de Carvalho to discuss with Judge
Drain the VARIG reorganization case in Brazil, the ancillary
proceedings in the U.S. Bankruptcy Court, and more generally, the
reorganization under the new Brazilian and U.S. Bankruptcy Codes.

"We believe that mutual understanding between [the] Courts and a
unified approach to the case are fundamentally important to the
successful reorganization of VARIG and the continuance of its
operations with the minimum possible adverse effect on the
airline's creditors, employees and contractors," Judge Cavalieri
said in a letter to Judge Drain.

"VARIG is important to Brazil, as a taxpayer, employer, and
member of the airline industry, and [it] plays a critical role
in connecting parts of the country which are accessible only by
air."

In line with the appointment, Judge Cavalieri emphasizes the
importance of close cooperation between the judiciary of Brazil
and the U.S. as a means of enhancing the commercial relations
between the two countries.

Headquartered in Rio de Janeiro, Brazil, VARIG S.A. is Brazil's
largest air carrier and the largest air carrier in Latin
America.  VARIG's principal business is the transportation of
passengers and cargo by air on domestic routes within Brazil and
on international routes between Brazil and North and South
America, Europe and Asia.  VARIG carries approximately 13
million passengers annually and employs approximately 11,456
full-time employees, of which approximately 133 are employed in
the United States.

The Company, along with two affiliates, filed for a judicial
reorganization proceeding under the New Bankruptcy and
Restructuring Law of Brazil on June 17, 2005, due to a
competitive landscape, high fuel costs, cash flow deficit, and
high operating leverage.  The Debtors may be the first case
under the new law, which took effect on June 9, 2005.  Similar
to a chapter 11 debtor-in-possession under the U.S. Bankruptcy
Code, the Debtors remain in possession and control of their
estate pending the Judicial Reorganization.  Sergio Bermudes,
Esq., at Escritorio de Advocacia Sergio Bermudes, represents the
carrier in Brazil.

Each of the Debtors' Boards of Directors authorized Vicente
Cervo as foreign representative.  In this capacity, Mr. Cervo
filed a Sec. 304 petition on June 17, 2005 (Bankr. S.D.N.Y. Case
Nos. 05-14400 and 05-14402).  Rick B. Antonoff, Esq., at
Pillsbury Winthrop Shaw Pittman LLP represents Mr. Cervo in the
United States.  As of March 31, 2005, the Debtors reported
BRL2,979,309,000 in total assets and BRL9,474,930,000 in total
debts. (VARIG Bankruptcy News, Issue No. 8; Bankruptcy
Creditors' Service, Inc., 215/945-7000)


VARIG S.A.: Aircraft SPC-6 Wary of Status of Assets
---------------------------------------------------
Aircraft SPC-6, Inc., asks the U.S. Bankruptcy Court for the
Southern District of New York to dissolve the Preliminary
Injunction and decline to enter any further injunctive relief so
that it can take any action necessary for it to protect its
rights.

Aircraft SPC-6 currently leases one Boeing 737-4YO aircraft, and
two CFM56-3C1 engines to Viacao Aerea Rio-Grandense, S.A.,
pursuant to a lease dated as of April 2, 2004.

Under the four-year lease term, VARIG is obligated to pay
Aircraft SPC-6, on a monthly basis, for its use of the Aircraft,
rent, maintenance reserves and other payments that may become due
under the Lease.  In addition, VARIG will also maintain the
Aircraft on a continuous basis.

Jon Yard Arnason, Esq., at Klestadt & Winters, LLP, in New York,
relates that before filing for bankruptcy in Brazil and before
its Section 304 proceedings in the United States Bankruptcy
Court, VARIG had defaulted in its obligations under the Lease,
and owed Aircraft SPC-6 $342,140, in rent, maintenance reserves
and other payments due under the Lease.

Mr. Arnason continues that VARIG has also defaulted in its
payment obligations under the Lease postpetition, and currently
owes Aircraft SPC-6 $210,490, in certain liabilities that have
accrued since June 17, 2005.  An additional payment of rent and
maintenance reserves -- which are estimated to exceed $200,000 --
became due on Sept. 12, 2005.

In addition, both engines on the Aircraft are due for overhaul in
October and November 2005.  At that time, the engines will
require removal from the airframe for the significant
maintenance.

Mr. Arnason relates that the position of Aircraft SPC-6 is
apparently shared by nearly all of the lessors.  Mr. Arnason
alleges that VARIG is treating its lessors selectively depending
on whether they insist on payment, contrary to VARIG's clearly
stated intent in its application for a preliminary injunction.

In this connection, Mr. Arnason reminds Judge Drain of the lift
injunction motions previously filed by Willis Engine Lease and
International Lease Finance Corporation.  Two other lessors,
which together lease 18 aircrafts to VARIG, have also asked to
lift the injunction because of non-payment.

"The patience of the lessors is clearly exhausted," Mr. Arnason
says.

Mr. Arnason also points out that on September 6, 2005, Judge
Marcia Cunha Silva Araujo de Carvalho appeared at a conference
held by the U.S. Court and made a "highly unusual plea" that the
lessors wait until October 10, 2005, for payment.  Judge de
Carvalho justified that a transaction for MatlinPatterson Global
Advisers, LLC's acquisition of a VARIG asset would be in place by
that date, and that the necessary Brazilian procedures to approve
that transaction would have taken place.

Mr. Arnason argues that the statements of Judge de Carvalho
herself showed that a transaction with MatlinPatterson is "highly
uncertain."

Mr. Arnason further notes that that the MatlinPatterson deal has
a "drop dead" date of September 22, 2005.

"The situation of VARIG is familiar," Mr. Arnason says.  "It is
clearly losing money [and] it has unnamed interested investors
and one identified investor which apparently has the right to
terminate its agreement with VARIG if the deal does not close by
September 22."

Furthermore, Mr. Arnason points out that the formation of a
creditors' committee does not end the uncertainty, including the
issues on the Matlin Patterson deal, the auction proceeding, and
VARIG's investor.

During the period of uncertainty, which may go on for a
substantial period of time, the lessors, including Aircraft
SPC-6, are asked to be involuntary lenders to VARIG and its
affiliates.  Mr. Arnason asserts that it is "not the basis on
which the Court entered the Preliminary Injunction, and the
serious injury being suffered by Aircraft SPC-6 and other lessors
clearly dictates denying any further injunctive relief."

In light of the serious financial condition of VARIG and its
historical pattern of not paying their vendors for performing the
significant engine work, Aircraft SPC-6 is seriously concerned
that the work will not be performed by VARIG, as is required
under the Lease and that its engines will be separated from the
airframe.  That would place Aircraft SPC-6 in a significantly
worse position, Mr. Arnason says.

Headquartered in Rio de Janeiro, Brazil, VARIG S.A. is Brazil's
largest air carrier and the largest air carrier in Latin
America.  VARIG's principal business is the transportation of
passengers and cargo by air on domestic routes within Brazil and
on international routes between Brazil and North and South
America, Europe and Asia.  VARIG carries approximately 13
million passengers annually and employs approximately 11,456
full-time employees, of which approximately 133 are employed in
the United States.

The Company, along with two affiliates, filed for a judicial
reorganization proceeding under the New Bankruptcy and
Restructuring Law of Brazil on June 17, 2005, due to a
competitive landscape, high fuel costs, cash flow deficit, and
high operating leverage.  The Debtors may be the first case
under the new law, which took effect on June 9, 2005.  Similar
to a chapter 11 debtor-in-possession under the U.S. Bankruptcy
Code, the Debtors remain in possession and control of their
estate pending the Judicial Reorganization.  Sergio Bermudes,
Esq., at Escritorio de Advocacia Sergio Bermudes, represents the
carrier in Brazil.

Each of the Debtors' Boards of Directors authorized Vicente
Cervo as foreign representative.  In this capacity, Mr. Cervo
filed a Sec. 304 petition on June 17, 2005 (Bankr. S.D.N.Y. Case
Nos. 05-14400 and 05-14402).  Rick B. Antonoff, Esq., at
Pillsbury Winthrop Shaw Pittman LLP represents Mr. Cervo in the
United States.  As of March 31, 2005, the Debtors reported
BRL2,979,309,000 in total assets and BRL9,474,930,000 in total
debts. (VARIG Bankruptcy News, Issue No. 8; Bankruptcy
Creditors' Service, Inc., 215/945-7000)


VARIG S.A.: Opposes GATX's Bid to Lift Preliminary Injunction
-------------------------------------------------------------
Vicente Cervo and Eduardo Zerwes, representatives for VARIG S.A.
and its debtor-affiliates ask the U.S. Bankruptcy Court for the
Southern District of New York deny GATX Financial Corporation's
request to lift the preliminary injunction.

As reported in the Troubled Company Reporter, GATX leases these
aircraft to the Debtors pursuant to certain lease agreements:

   Aircraft MSN     Aircraft Type    Lessee    Lease Date
   ------------     -------------    ------    ----------
      28870            B737-300       VARIG    05/19/1998
      30477            B737-800       VARIG    11/21/2001
      30571            B737-800       VARIG    09/06/2001
      23922            B737-3YO      Rio-Sul   11/01/2000

GATX asked the Bankruptcy Court to modify the Preliminary
Injunction so that it may protect its interests in four aircrafts
leased to the Debtors.  GATX claimed that its rights are not
adequately protected.

The Foreign Representatives do not deny that temporary liquidity
constraints have resulted in delayed lease payments.  However,
they argue that the Preliminary Injunction should continue for an
additional period to allow a pending financing transaction to
proceed.  That transaction, the Foreign Debtors point out, is
expected to cure all debts under the leases and provide adequate
assurance of current payments of all leases and other operating
expenses through completion of the restructuring process in the
foreign proceedings.

Rick B. Antonoff, Esq., at Pillsbury, Winthrop, Shaw, Pittman,
LLP, in New York, tells Judge Drain that with a brief extension
of the Preliminary Injunction, the Foreign Debtors have a
realistic chance of curing all post-June 17 lease arrearages and
successfully completing their bankruptcy proceedings in Brazil in
a reasonably short period of time.  However, if the Preliminary
Injunction is lifted, the Foreign Debtors would risk damage to
their business to the detriment of all their creditors.

Mr. Antonoff notes that all of the Foreign Debtors' lessors
received current payments during the first weeks immediately
following the Petition Date -- a right that the lessors would not
have had in a case under the Bankruptcy Code.  Furthermore, the
Debtors anticipate making partial payments to lessors so that no
one will be in arrears exceeding 35 days.

"Therefore, briefly extending the Preliminary Injunction at this
time should be deemed, on the whole, as consistent with United
States policy and practice, particularly where, as in this case,
a transaction is not just in prospect but is actually
pending," Mr. Antonoff asserts.

GATX's allegations regarding aircraft maintenance are
"misleading," Mr. Antonoff remarks.

Mr. Antonoff ascertains that the Foreign Debtors can demonstrate
that they have consistently carried out a sufficient maintenance
program for the leased GATX aircraft.

Mr. Antonoff affirms that the Foreign Debtors' high standard and
reputation for quality maintenance is a matter of wide industry
and regulatory recognition in Brazil, the U.S., and
internationally, and the subject of consistent inspection by
regulatory authorities.

In addition, Mr. Antonoff relates that the leased GATX aircraft
engine is being prepared to be sent to an outsourced engine shop
for repair or overhaul.  The Engine was not disassembled, Mr.
Antonoff clarifies.  Except for a few parts, which compose the
quick engine change kit or line replaceable units, the majority
of engine life limited parts are an integral part of the engine
core, which means that they can be removed only after
disassembling the engine in an engine overhaul shop.

Mr. Antonoff asserts that VARIG does not run an engine overhaul
shop, so it cannot "cannibalize" those internal parts from the
engine to install on other engines or aircraft.  Regardless,
removal of QEC/LRU components is required prior to sending an
engine to be overhauled on an engine overhaul shop.  The
components are individually controlled by the airline and are not
considered primary parts of the engine.

"The removal of those components from one engine and installation
on another of the same operator's engines is a normal and
permitted procedure in the aviation industry, and is in
accordance with governing aviation regulations," Mr. Antonoff
says.

Regarding storage, Mr. Antonoff says that VARIG follows aircraft
maintenance manual procedures and stores engines in a closed
warehouse that protects them from outside weather.

With respect to engine maintenance, VARIG has an engine
maintenance agreement with GE Engine Services to repair and
overhaul all GE and CFM engines.  Moreover, after the Petition
Date, VARIG has signed a maintenance agreement with TAP
Maintenance and Engineering to provide engine repair and overhaul
support.

Mr. Antonoff informs the Court that five CFM56-3 engines are
currently undergoing overhaul services in Lisbon, Portugal, and
will be returned to VARIG next September and October.  VARIG is
signing another agreement to send another five engines of the
same type to SNECMA Engines Services in France.

"These engine maintenance providers are very cooperative and are
adjusting their payment schedules to accommodate VARIG's cash
flow by allowing the payments to be made in monthly
installments," Mr. Antonoff tells Judge Drain.  "Therefore, it is
evident that both before and after June 17, 2005, VARIG has been
continuously paying for its engine maintenance."

The reorganization proceedings contemplate that adequate
resources will be allocated to maintenance, including engines.
VARIG plans to send the Engine to be overhauled by one of those
shops in the near future, Mr. Antonoff notes.

Mr. Antonoff avers that VARIG should be given the same
opportunity as any debtor in a case under the Bankruptcy Code to
reorganize and continue as vital contributor and member of a
commercial, economic and social community.

Mr. Antonoff notes that Section 105 of the Bankruptcy Code
permits the Court to keep the Preliminary Injunction in full
effect, at least until the Foreign Debtors have had a reasonable
opportunity to obtain approval of the interim financing and cure
the postpetition rental payment defaults to GATX.

If GATX is allowed to repossess aircraft and engines, then the
harm to the Foreign Debtors, who may be immediately forced to
cease operations, will far outweigh the harm that will be imposed
on GATX if it is required to stand down for an additional short
period for payment, Mr. Antonoff insists.

Headquartered in Rio de Janeiro, Brazil, VARIG S.A. is Brazil's
largest air carrier and the largest air carrier in Latin
America.  VARIG's principal business is the transportation of
passengers and cargo by air on domestic routes within Brazil and
on international routes between Brazil and North and South
America, Europe and Asia.  VARIG carries approximately 13
million passengers annually and employs approximately 11,456
full-time employees, of which approximately 133 are employed in
the United States.

The Company, along with two affiliates, filed for a judicial
reorganization proceeding under the New Bankruptcy and
Restructuring Law of Brazil on June 17, 2005, due to a
competitive landscape, high fuel costs, cash flow deficit, and
high operating leverage.  The Debtors may be the first case
under the new law, which took effect on June 9, 2005.  Similar
to a chapter 11 debtor-in-possession under the U.S. Bankruptcy
Code, the Debtors remain in possession and control of their
estate pending the Judicial Reorganization.  Sergio Bermudes,
Esq., at Escritorio de Advocacia Sergio Bermudes, represents the
carrier in Brazil.

Each of the Debtors' Boards of Directors authorized Vicente
Cervo as foreign representative.  In this capacity, Mr. Cervo
filed a Sec. 304 petition on June 17, 2005 (Bankr. S.D.N.Y. Case
Nos. 05-14400 and 05-14402).  Rick B. Antonoff, Esq., at
Pillsbury Winthrop Shaw Pittman LLP represents Mr. Cervo in the
United States.  As of March 31, 2005, the Debtors reported
BRL2,979,309,000 in total assets and BRL9,474,930,000 in total
debts. (VARIG Bankruptcy News, Issue No. 8; Bankruptcy
Creditors' Service, Inc., 215/945-7000)


VILLAGES AT SARATOGA: Hires Robert Frugal as Bankruptcy Counsel
---------------------------------------------------------------
The Villages at Saratoga Springs, LC, sought and obtained from the
U.S. Bankruptcy Court for the District of Utah authority to employ
Robert Frugal as its general counsel.

Mr. Frugal will:

    (a) examine officers of the Debtor and other parties as to the
        acts, conduct, and property of the Debtor;

    (b) advise, consult with and assist the Debtor concerning
        preparation and filing of reports, documents, statements,
        schedules, disclosure statements, plan, and any other
        papers required for effective administration of the case;

    (c) advise and consult with the Debtor concerning legal issues
        arising in the conduct of the administration of the estate
        and concerning the Debtor's legal rights and remedies with
        regard to the estate's assets and the claims of unsecured,
        preferred, and unsecured creditors and other parties in
        interest;

    (d) appear for, prosecute, defend and represent applicant's
        interest in motions, contested matters and adversary
        proceedings arising in or related to the case;

    (e) assist in the examination of legal documents, contracts,
        tax returns and other documents produced by the Debtor and
        creditors;

    (f) assist in the preparation of such pleadings, motions,
        notices and orders as required for the orderly
        administration of the estate;

    (g) review the filing of claims for legal sufficiency and to
        draft appropriate objections to inappropriate claims, as
        would be in the best interest of creditors;

    (h) advise the Debtor and prepare documents in connection with
        the ongoing operation of the Debtor's business;

    (i) assist in the identification and prosecution of claims and
        causes of action assertable by the Debtor on behalf of the
        estate;

    (j) advise the Debtor and prepare documents in connection with
        the liquidation of the assets of the estate including
        analysis and collection of outstanding receivables; and

    (k) counsel and represent the Debtor generally in connection
        with the chapter 11 case.

Documents submitted with the Court do not state how much Mr.
Frugal will be paid.

Mr. Frugal assures the Court that he is a "disinterested person"
as that term is defined by section 101(14) of the Bankruptcy Code.

Headquartered in Spanish Fork, Utah, The Villages at Saratoga
Springs, LC filed for chapter 11 protection on Aug. 29, 2005
(Bankr. D. Utah Case No. 05-33380).  Robert Fugal, Esq., at Bird &
Fugal, represents the Debtor in its restructuring efforts.  When
the Debtor filed for protection from its creditors, it listed
$26,002,293 in assets and $15,188,610 in debts.


VILLAGES AT SARATOGA: Files Schedules of Assets and Liabilities
---------------------------------------------------------------
The Villages at Saratoga Springs, LC, delivered its Schedules of
Assets and Liabilities to the U.S. Bankruptcy Court for the
District of Utah disclosing:

      Name of Schedule               Assets        Liabilities
      ----------------               ------        -----------
   A. Real Property                $26,000,000
   B. Personal Property                 $2,293
   C. Property Claimed
      As Exempt
   D. Creditor Holding                             $11,896,610
      Secured Claim
   E. Creditors Holding Unsecured
      Priority Claims
   F. Creditors Holding Unsecured                   $3,292,000
      Nonpriority Claims
   G. Executory Contracts and
      Unexpired Leases
   H. Codebtors
   I. Current Income of
      Individual Debtor(s)
   J. Current Expenditures of
      Individual Debtor(s)
                                   -----------     -----------
      Total                        $26,002,293     $15,188,610

Headquartered in Spanish Fork, Utah, The Villages at Saratoga
Springs, LC filed for chapter 11 protection on Aug. 29, 2005
(Bankr. D. Utah Case No. 05-33380).  Robert Fugal, Esq., at Bird &
Fugal, represents the Debtor in its restructuring efforts.  When
the Debtor filed for protection from its creditors, it listed
$26,002,293 in assets and $15,188,610 in debts.


VILLAGES AT SARATOGA: Section 341(a) Meeting Slated for Oct. 5
--------------------------------------------------------------
The U.S. Trustee for Region 19 will convene a meeting of The
Villages at Saratoga Springs, LC's creditors at 10:00 a.m., on
Oct. 5, 2005, at #9 Exchange Place, Boston Building, Suite 101,
Salt Lake City, Utah.

All creditors are invited, but not required, to attend.  This
Meeting of Creditors offers the one opportunity in a bankruptcy
proceeding for creditors to question a responsible office of the
Debtor under oath about the company's financial affairs and
operations that would be of interest to the general body of
creditors.

Headquartered in Spanish Fork, Utah, The Villages at Saratoga
Springs, LC filed for chapter 11 protection on Aug. 29, 2005
(Bankr. D. Utah Case No. 05-33380).  Robert Fugal, Esq., at Bird &
Fugal, represents the Debtor in its restructuring efforts.  When
the Debtor filed for protection from its creditors, it listed
$26,002,293 in assets and $15,188,610 in debts.


WATERMAN INDUSTRIES: Files Reorganization Plan in E.D. California
-----------------------------------------------------------------
Waterman Industries, Inc., filed its Plan of Reorganization and a
Disclosure Statement explaining that Plan with the U.S. Bankruptcy
Court for the Eastern District of California on Sept. 14, 2005.

                         Plan Funding

The Plan provides for the sale of all of the Debtor's assets,
except for real property, and certain litigation and account
receivables, to an entity formed by Galena National Investments
LLC.  Galena National is a successor in interest to Wells Fargo
Bank and asserts a first priority lien in a majority of the
Debtor's assets.

Galena National's purchase proposal includes:

    a) a $1.25 million cash payment;

    b) the assumption of all of the Debtor's debt to Galena;

    c) the assumption of ordinary course post-petition trade
       payables and ordinary course employee expenses not paid
       prior to the effective date of the Plan; and

    d) the lease of a portion of the Manufacturing Facility for an
       amount necessary to cover all payments to San Joaquin Bank.

As part of the sale agreement, Galena National agrees to forego
any deficiency unsecured claims it has against the Debtor.

The $1.25 million cash received from Galena National, proceeds
from litigation to be filed by the Debtor and collection of
certain accounts receivable will be used to pay the Debtor's
remaining creditors.  The Debtor estimates the total amount
available for distribution to general unsecured creditor at
$739,200 to $2,839,000.  Mr. Clifford Bressler, the Plan General
Manager, will manage all collections and distributions to be made
under the Plan.

The Debtor's receivables include tax refunds totaling $55,922 and
trade receivables with a collectible value between $450,000 to
$650,000.  The Debtor is entitled to retain the first $450,000
proceeds from  the trade receivable and any excess will be shared
with Galena National.

The Debtor expects to collect approximately $2 million from the
causes of action it intends to pursue against certain parties.
The Plan sets aside $200,000 to pay costs associated with the
litigation.

                    Treatment of Claims

Approximately $1.6 million of San Joaquin Bank's $2.3 million
claim will be treated as a secured claim.  The claim, secured by a
mortgage lien on the Debtor's Manufacturing Facility and Foundry,
will bear a 7% interest and will be paid in monthly installments
beginning at $12,500 per month and gradually increasing to $16,500
monthly. The Debtor allows San Jaoquin to foreclose on the
Manufacturing Facility if the Lease with Galena National
terminates prior to the full payment of its claim.

The estimated unpaid priority wage claims of $100,000 and health
and benefit claims of $400,000 will be paid in full on the
effective date of the Plan.

Priority tax claims will be paid, with statutory interest, either
on the effective date of the Plan or by deferred payments for a
period not exceeding six years after the date of the claim
assessment.

Oil city Iron Works, which holds a $210,000 secured claim, will be
allowed to foreclose on certain patterns that secure its claim.
Any deficiency amounts will be allowed as a general unsecured
claim.

General Unsecured Claims (Class 3-A) will receive pro rata
distributions from any proceeds of Plan Assets after payment of
all other secured and priority claims.  The General Manger will
schedule the payments.

Unsecured Convenience Class Claims (Class 3-B) will receive the
lesser of 50% of the allowed claim or $250.  Holders of General
Unsecured Claims equal to or less than $500 are automatically
included under this class. The General Manger will schedule the
payments.

Equity holders will get nothing under the Plan.

The Hon. W. Richard Lee will convene a hearing at 10:30 a.m. on
Oct. 13, 2005, to determine the adequacy of the Debtor's
Disclosure Statement.

Headquartered in Exeter, California, Waterman Industries, Inc.
-- http://www.watermanusa.com/-- provides water and irrigation
control services.  The Company filed for chapter 11 protection on
February 10, 2004 (Bankr. E.D. Calif. Case No. 04-11065).  Riley
C. Walter, Esq., at Walter Law Group, represents the Debtor in its
restructuring efforts.  When the Debtor filed for protection from
its creditors, it listed more than $10 million in estimated assets
and debts.


WERNER HOLDING: S&P Affirms Junk Corporate Credit Rating
--------------------------------------------------------
Standard & Poor's Rating Services affirmed its 'CCC+' corporate
credit rating on Greenville, Pennsylvania-based Werner Holding Co.
Inc. and revised its outlook to negative from stable.

"The rating action reflects the expectation of weaker earnings as
a result of continued pressure from transportation costs and raw
material prices, especially aluminum," said Standard & Poor's
credit analyst Lisa Wright.  "Weaker financial performance could
lead to covenant violations.  The outlook also reflects our
longer-term concern regarding the company's ability to refinance
its maturing debt in May 2007."

Greenville, Pennsylvania-based Werner Holding has about $377
million of debt outstanding, including amounts outstanding under a
nonrecourse accounts receivable securitization facility.

Werner primarily produces aluminum and fiberglass ladders, as well
as scaffolds, platforms, and step stools and is the largest U.S.
manufacturer of ladders.

"Rising sales, restructuring benefits, and adequate liquidity are
expected to be offset by high raw-material, transportation,
interest costs, and intensely competitive industry dynamics," Ms.
Wright said.  "The company's debt leverage is very aggressive and
its financial covenants are restrictive.  Ratings could be lowered
if Werner's liquidity deteriorates substantially, financial
covenants are breached, restructuring activities are delayed or
not successful.  Ratings could be raised or the outlook revised to
stable if the company substantially improves its cash flows
through higher sales or declining raw-material costs, if it
addresses debt maturities in a timely fashion, and if it
negotiates less restrictive financial covenants."


WESTPOINT STEVENS: Funds, et al. Wants Panel's Fee Request Denied
-----------------------------------------------------------------
As previously reported, the Steering Committee seeks $725,131,000
in fees and $73,947 in expenses for September 2004 through
July 2005, plus any additional fees and expenses incurred after
August 1, 2005, that have not yet been invoiced.

Likewise, on August 1, 2005, R2 Top Hat Ltd. filed with the Court
an application for interim professional compensation for
$1,038,823 in fees and $92,425 in expenses from June 2003 through
September 2004.

The Steering Committee and R2 Top Hat both assert that they are
entitled to reimbursement by the Debtors pursuant to the First
Lien Credit Agreement.

Two groups have responded to the fee requests:

(1) Aretex, et al.

Aretex LLC, WestPoint International, Inc., and WestPoint Home
Inc., purchasers of substantially all of the Debtors' assets, note
that R2 and the Steering Committee both admit that the value of
the collateral securing the amount due under the First Lien Credit
Agreement exceeds the amount of their claim.  Both Section 506(b)
of the Bankruptcy Code and the Adequate Protection Order only
permit fees to be paid to the extent authorized pursuant to the
First Lien Credit Agreement, and to the extent reasonable.  Thus,
the burden is on the Steering Committee and R2 to demonstrate that
their fees and expenses satisfy these conditions, Peter D.
Wolfson, Esq., at Sonnenschein Nath & Rosenthal LLP, in New York,
says.

Pursuant to Section 11.5(a) of the First Lien Credit Agreement,
the Debtors are obligated to pay only those costs and expenses of
the First Lien Lenders, including reasonable attorney's fees that
were incurred in connection with the "enforcement" of the credit
documents.  Mr. Wolfson points out that the Steering Committee and
the R2, without regard to the plain language of Section 11.5(a),
seek reimbursement of all fees and expenses they incurred during
the Debtors' Chapter 11 case, whether or not related to the
enforcement of the Credit Documents.

Mr. Wolfson asserts that neither the Steering Committee nor R2
took the trouble in its application to distinguish between which
may be reimbursable under the First Lien Credit Agreement and
which may not.  Moreover, a substantial portion, if not most, of
both applications do not consist of services covered by Section
11.5(a), and many of the Steering Committee's fees relate to its
joint bid with Wilbur Ross, Mr. Wolfson maintains.

Mr. Wolfson also says that even to the extent covered, a
significant portion of the fees and expenses do not meet the
reasonableness standard of the First Lien Credit Agreement or
Section 506(b).  "The applicants made no effort to discuss the
reasonableness of their fees, and even a cursory review of these
applications and the others received to date evidence significant
duplication of effort," Mr. Wolfson argues.  "This failure of
coordination among individual parties to the First Lien Credit
Agreement should not accrue to the detriment of the Debtors, its
other creditors or the Purchaser."

According to Mr. Wolfson, in the event the Court approves and
allows any portion of the fees and expenses requested, another
issue arises -- the source of payment.  The Order authorizing the
sale of substantially all of the Debtors' Assets contemplates full
satisfaction of the First Lien Indebtedness, which does include
appropriate fees and expenses pursuant to Section 11.5(a).
However, at the time the Court entered the Sale Order, no party
had delivered any invoices to the Purchaser, and the schedules of
First Lien Indebtedness attached to the Sale Order included only
principal plus interest.

To the extent any fees and expenses are allowed to applicants,
Mr. Wolfson asserts that those fees and expenses should be paid
out of the cash held in the escrow account or from the proceeds of
the assets excluded from the Sale.

Mr. Wolfson points out that most of the time, entries in the R2
and the Steering Committee applications do not fall within the
definition of allowable fees and expenses under the First Lien
Credit Agreement.  He notes that they do not relate to the
enforcement of rights under the First Lien Credit Agreement, are
duplicative of other fees already paid by the estate to the First
Lien Agent for similar services, and are simply not reasonable in
context of the case.

(2) Second Lien Agent and Funds

To the extent that the Steering Committee contends that the
request of Wilmington Trust Company as successor Administrative
Agent under the Second Lien Credit Agreement for disbursement of
the funds held in the Second Lien Adequate Protection escrow
should be held up pending payment of the Steering Committee's
legal fees, or that the escrowed amounts should be invaded to pay
those fees, the Second Lien Agent objects.

Although the Steering Committee requests that either the Debtors
or WestPoint International and WestPoint Home pay its fees and
expenses, the Steering Committee alleges that the Second Lien
Lenders "cannot receive any payment until the First Lien Lenders
have been paid in full, . . . include[ing] the payment of
[Hennigan, Bennett & Dorman LLP]'s fees and expenses requested
herein and incurred hereafter," Gordon Z. Novod, Esq., at Kramer
Levin Naftalis & Frankel LLP, in New York, relates.

The Court's Adequate Protection Order did not provide for current
payment of the fees and expenses of legal advisors to any First
Lien Lenders, but only of the First Lien Agent's legal fees and
expenses, Mr. Novod explains.  Therefore, on any day that payments
became due and payable to the Second Lien Lenders under the
Adequate Protection Order, those payments were free and clear of
any claim of individual First Lien Lenders to have their legal
fees paid.

"Whether the Steering Committee has a valid Section 506(b) claim
against the Debtors' estates for recovery of their reasonable
legal fees is irrelevant, because neither the Steering Committee
nor the Debtors' estates have any right to the funds in the
Adequate Protection Escrow," Mr. Novod asserts.  "The only remedy
for their claim is a superpriority administrative expense claim
against the estates . . . which would, in any event, be junior to
the claim that Adequate Protection Order granted to the 2nd Lien
Lenders."

Thus, GSC Partners, Pequot Capital Management, Inc., and Perry
Principals LLC -- the Funds -- and Wilmington Trust Company, as
Agent to the 2nd Lien Lenders, ask the Court to deny the Steering
Committee's Fee Request.

Headquartered in West Point, Georgia, WestPoint Stevens, Inc., --
http://www.westpointstevens.com/-- is the #1 US maker of bed
linens and bath towels and also makes comforters, blankets,
pillows, table covers, and window trimmings.  It makes the Martex,
Utica, Stevens, Lady Pepperell, Grand Patrician, and Vellux
brands, as well as the Martha Stewart bed and bath lines; other
licensed brands include Ralph Lauren, Disney, and Joe Boxer.
Department stores, mass retailers, and bed and bath stores are its
main customers.  (Federated, J.C. Penney, Kmart, Sears, and Target
account for more than half of sales.) It also has nearly 60 outlet
stores.  Chairman and CEO Holcombe Green controls 8% of WestPoint
Stevens.  The Company filed for chapter 11 protection on
June 1, 2003 (Bankr. S.D.N.Y. Case No. 03-13532).  John J.
Rapisardi, Esq., at Weil, Gotshal & Manges, LLP, represents the
Debtors in their restructuring efforts. (WestPoint Bankruptcy
News, Issue No. 56; Bankruptcy Creditors' Service, Inc.,
215/945-7000)


WHITEFORD FOOD: Case Summary & 20 Largest Unsecured Creditors
-------------------------------------------------------------
Debtor: Whiteford Food Products, Inc.
        1825 Seventh Street Northwest
        Rochester, Minnesota 55901

Bankruptcy Case No.: 05-46836

Type of Business: The Debtor supplies meat and food products.

Chapter 11 Petition Date: September 26, 2005

Court: District of Minnesota (Minneapolis)

Judge: Robert J. Kressel

Debtor's Counsel: Faye Knowles, Esq.
                  Fredrikson & Byron, P.A.
                  4000 Pillsbury Center
                  200 South Sixth Street
                  Minneapolis, Minnesota 55402-1425
                  Tel: (612) 492-7000
                  Fax: (612) 492-7077

Total Assets: $1 Million to $10 Million

Total Debts:  $1 Million to $10 Million

Debtor's 20 Largest Unsecured Creditors:

   Entity                        Nature of Claim    Claim Amount
   ------                        ---------------    ------------
Beef Products Inc                Goods/Services         $721,990
P.O. Box 8065
Des Moines, IA 50301
Tel: (605) 217-8000

Packerland Packing Co. Inc.      Goods/Services         $641,529
P.O. Box 952080
Saint Louis, MO 63195
Tel: (800) 753-7724

Huisken Meat Company             Goods/Services         $417,648
P.O. Box 86
Minneapolis, MN 55486
Tel: (507) 529-4700

Greater Omaha Packing Co.        Goods/Services         $204,925
P.O. Box 7566
Omaha, NE 68107

Packerland Plainwell             Goods/Services         $145,234
P.O. Box 952080
Saint Louis, MO 63195

Bell Packaging Corp.             Goods/Services         $120,318
P.O. Box 406882
Atlanta, GA 30384

Holland Group                    Goods/Services         $106,459
P.O. Box 633510
Cincinnati, OH 45263

Astro Meat Trading               Goods/Services         $102,862
P.O. Box 765
Indiana, PA 15701

Packaging Corp. of America       Goods/Services          $95,707
36596 Treasury Center
Chicago, IL 60694

Meat & Deli Marketing            Goods/Services          $70,853
3102 SE J Street
Bentonville, AR 72712

National Beef Packaging Co.      Goods/Services          $62,349
P.O. Box 875875
Kansas City, MO 64187

Linde Gas LLC                    Goods/Services          $56,859
P.O. Box 802807
Chicago, IL 60680

Moyer Packing Co.                Goods/Services          $55,896
P.O. Box 8500
Philadelphia, PA 19178

Jasons Foods Inc.                Goods/Services          $55,211
Lockbox 809289
Chicago, IL 60680

Gurrentz International Corp.     Goods/Services          $52,274
P.O. Box 360860
Pittsburgh, PA 15251

Taylor Packing Co. Inc.          Goods/Services          $51,660
P.O. Box 3021
Boston, MA 02241

AL Smith Trucking Inc.           Goods/Services          $48,909
8984 Murphy Road
Versailles, OH 45380

We Market Success                Goods/Services          $41,080
255 Colrain Street South
Grand Rapids, MI 49548

Gordon Food Service Inc.         Goods/Services          $35,947
P.O. Box 1787
Grand Rapids, MI 49501

Cargill Meat Solutions Corp.     Goods/Services          $34,474
P.O. Box 640960
Pittsburgh, PA 15264


WHITING PETROLEUM: S&P Rates Proposed $250 Million Notes at B-
--------------------------------------------------------------
Standard & Poor's Ratings Services affirmed its 'B+' long-term
corporate credit rating on oil and gas exploration and production
company Whiting Petroleum Corp. and removed the rating from
CreditWatch with negative implications.  The outlook is now
stable.

The rating was originally placed on CreditWatch on July 28, 2005.
At the same time, Standard & Poor's assigned its 'B-' rating to
Whiting's proposed $250 million senior subordinated notes due
2014.  Pro forma for the expected capital raises, Denver,
Colorado-based Whiting will have about $930 million in debt.

"The removal of the ratings from CreditWatch and subsequent stable
outlook is predicated on the successful execution of Whiting's
announced capital raises," said Standard & Poor's credit analyst
David Lundberg.  "The proceeds are expected to be used to pay down
revolver outstandings and fund the North Ward Estes acquisition
that closes on October 4," he continued.

On October 4, Whiting intends to issue $250 million in senior
subordinated notes and 5.7 million common shares.  There is also a
greenshoe option to increase the shares offering by 15%.

The stable outlook incorporates the expectation that Whiting will
prudently manage its financial profile.  The application of free
cash flow to debt reduction and the maintenance of capital
spending within cash flows are factored into the outlook.  The
outlook could be revised to negative if the company's operating
metrics deteriorate, capital expenditures rise materially above
expectations, or if the company pursues further debt-financed
acquisitions.

An outlook revision to positive requires evidence of a successful
integration of the recently acquired Celero Energy LP properties,
as well as further debt reduction.


WILLIAM BOYD: Case Summary & Largest Unsecured Creditors
--------------------------------------------------------
Debtor: William Boyd Printing Company, Inc.
        49 Sheridan Avenue
        Albany, New York 12210

Bankruptcy Case No.: 05-16900

Type of Business: The Debtor operates a printing press that
                  specializes in the production of loose-leaf
                  publications, perfectbound or saddle-stitched
                  books and journals of every kind.
                  See http://www.boydprinting.com/

Chapter 11 Petition Date: September 26, 2005

Court: Northern District of New York (Albany)

Debtor's Counsel: Robert J. Rock, Esq.
                  Law Office of Robert J. Rock
                  60 South Swan Street
                  Albany, New York 12210
                  Tel: (518) 463-5700

Estimated Assets: $1 Million to $10 Million

Estimated Debts:  $1 Million to $10 Million

A full-text copy of the Debtor's 23-page list of its 20 largest
unsecured creditors is available for free at
http://ResearchArchives.com/t/s?1da


WILLIAM FITZGERALD: Case Summary & Largest Unsecured Creditor
-------------------------------------------------------------
Debtor: William Fitzgerald
        26 Ormond Avenue
        Ewing, New Jersey 08638

Bankruptcy Case No.: 05-41674

Chapter 11 Petition Date: September 26, 2005

Court: District of New Jersey (Trenton)

Debtor's Counsel: Peter E. Zimnis, Esq.
                  Law Office of Peter E. Zimnis
                  1245 Whitehorse Mercerville Road, Suite 412
                  Trenton, New Jersey 08619
                  Tel: (609) 581-9353

Total Assets: $4,681,160

Total Debts:  $1,482,434

Debtor's Largest Unsecured Creditor:

   Entity                     Nature of Claim       Claim Amount
   ------                     ---------------       ------------
Teich Groh                    Commercial Property        Unknown
Re: Arja Ventures             in 1474 Prospect St.,
691 Route 33                  Ewing, NJ
Trenton, NJ 08619             Value of Security:
                              $3,350,000


WILLIAMS SCOTSMAN: S&P Upgrades Corporate Credit Rating to BB-
--------------------------------------------------------------
Standard & Poor's Ratings Services raised its ratings on Williams
Scotsman Inc., including the corporate credit rating to 'BB-' from
'B', and removed the ratings from CreditWatch with positive
implications, where they were placed on May 2, 2005.  The rating
actions follow Williams Scotsman's successful completion of a
$245 million IPO on September 19, 2005.  The outlook is stable.

"The company's financial profile has improved as a result of the
IPO," said Standard & Poor's credit analyst Betsy Snyder.
"Proceeds from both the IPO and the sale of $350 million of senior
notes due Oct. 1, 2015, will be used to redeem $550 million of 9
7/8% notes and $150 million of 10% notes," the analyst continued.

Ratings on Baltimore, Maryland-based Williams Scotsman Inc.
reflect its weak, but improved, financial profile, pro forma for
its recapitalization.  Ratings also incorporate the company's
strong market position in the leasing of mobile office units, a
business that has tended to be somewhat recession-resistant.  The
IPO will improve privately held Williams Scotsman's financial
profile somewhat, reducing debt to capital to under 80% from 98%
at December 31, 2004, and debt to EBITDA to the mid-5x area from
6.5x (as a leasing company, Williams Scotsman can operate at
higher leverage than a typical like-rated industrial company).

The recapitalization also includes the $650 million restated and
amended credit facility the company completed on June 28, 2005,
and $350 million of senior unsecured notes issued in conjunction
with the IPO.  However, the company's financial flexibility is
still constrained by a high percentage of secured assets
(approximately 46%) and will continue to be weaker than that
of its major competitor, GE Capital Modular Space, owned by
General Electric Capital Corp. (AAA/Stable/A-1+).

Williams Scotsman operates primarily as one of two major national
participants in the estimated $3 billion U.S. market for leasing
and sale of modular space.  Williams Scotsman and GE each have a
market shares of approximately 25%, with the rest of the market
highly fragmented.  The company's fleet is comprised of 97,000
units -- 77,000 mobile offices and 20,000 storage units.  The
company operates out of:

   * 76 branches in 39 states,
   * eight branches in Canada, and
   * one branch in Mexico.

It has approximately 25,000 customers in 450 industries; primarily
construction, education, and commercial and industrial users.  The
leasing of mobile office units has tended to be somewhat
recession-resistant, as it offers customers more flexibility and
lower costs than does building permanent facilities for certain
purposes.  In addition, the company has the flexibility to
redeploy assets to different geographic areas if demand and/or
supply necessitates.

Williams Scotsman's earnings and cash flow are expected to improve
along with demand.  However, an expected fairly substantial level
of capital spending will likely constrain any significant
improvement in its financial profile.  A reduced level of capital
spending or further equity issuance could result in a positive
outlook.  A material increase in capital spending or significant
debt-financed acquisitions could result in a negative outlook.


WILLBROS GROUP: Noteholders Agree to Waive Potential Defaults
-------------------------------------------------------------
Willbros Group, Inc. (NYSE: WG) received and accepted consents
from the holders of a majority in principal amount of its 2.75%
convertible senior notes due 2024 to:

   -- waive any potential defaults that may have occurred before
      the proposed amendments become effective;

   -- rescind a purported notice of default that was delivered to
      Willbros under the indenture; and

   -- clarify that for a period ending on the nine-month
      anniversary of the date the proposed amendments become
      effective, no default will occur if Willbros fails to timely
      file a periodic report with the Securities and Exchange
      Commission.

Bear, Stearns & Co. Inc. acted as the solicitation agent and D.F.
King & Co., Inc., served as the information agent and tabulation
agent for the consent solicitation.  Information regarding the
consent solicitation may be obtained by contacting Bear, Stearns &
Co., Inc., Global Liability Management Group at (877) 696-BEAR
(toll free) or (877) 696-2327 (toll free).

Willbros Group, Inc. -- http://www.willbros.com/-- is an
independent contractor serving the oil, gas and power industries,
providing engineering and construction, and facilities development
and operations services to industry and government entities
worldwide.


* Large Companies with Insolvent Balance Sheets
-----------------------------------------------
                                Total
                                Shareholders  Total     Working
                                Equity        Assets    Capital
Company                 Ticker  ($MM)          ($MM)     ($MM)
-------                 ------  ------------  -------  --------
ACCO Brands Corp        ABD         (28)         878     (364)
Abraxas Petro           ABP         (43)         106       (5)
AFC Enterprises         AFCE        (44)         216       52
Alliance Imaging        AIQ         (52)         621       43
Amazon.com Inc.         AMZN        (64)       2,601      782
AMR Corp.               AMR        (615)      29,494   (2,230)
Atherogenics Inc.       AGIX        (76)         235      213
Bally Total Fitn        BFT        (172)       1,461     (290)
Biomarin Pharmac        BMRN       (110)         167       (4)
Blount International    BLT        (220)         446      126
CableVision System      CVC      (2,430)      10,111   (1,607)
CCC Information         CCCG       (107)          96       20
Centennial Comm         CYCL       (480)       1,447       59
Choice Hotels           CHH        (185)         283      (36)
Cincinnati Bell         CBB        (625)       1,891      (18)
Clorox Co.              CLX        (553)       3,617     (258)
Coley Pharma            COLY         (5)          71       30
Compass Minerals        CMP         (81)         667      129
Crown Media HL-A        CRWN        (34)       1,289     (130)
Delphi Corp.            DPH      (4,392)      16,511      256
Deluxe Corp             DLX        (124)       1,508     (276)
Denny's Corporation     DENN       (260)         494      (73)
Domino's Pizza          DPZ        (574)         420      (21)
Echostar Comm-A         DISH       (972)       7,281      269
Emeritus Corp.          ESC        (123)         720      (43)
Foster Wheeler          FWLT       (490)       2,012     (175)
Guilford Pharm          GLFD        (20)         136       60
Graftech International  GTI         (34)       1,006      264
I2 Technologies         ITWO       (153)         386      124
ICOS Corp               ICOS        (57)         243      160
IMAX Corp               IMAX        (38)         241       27
Immersion Corp.         IMMR        (11)          46       30
Intermune Inc.          ITMN         (7)         219      133
Investools Inc.         IED         (22)          56      (47)
Isis Pharm.             ISIS       (124)         147       46
Kulicke & Soffa         KLIC        (44)         365      182
Lodgenet Entertainment  LNET        (72)         275       15
Lucent Tech Inc.        LU          (70)      16,437    2,517
Maxxam Inc.             MXM        (681)       1,024      103
Maytag Corp.            MYG         (77)       3,019      398
McDermott Int'l         MDR        (140)       1,489      123
McMoran Exploration     MMR         (39)         377      135
Nexstar Broadc - A      NXST        (51)         684       27
NPS Pharm Inc.          NPSP        (98)         310      215
ON Semiconductor        ONNN       (346)       1,132      270
Owens Corning           OWENQ    (8,225)       7,766    1,391
Primedia Inc.           PRM        (771)       1,506       16
Qwest Communication     Q        (2,663)      24,070    1,248
RBC Bearings Inc.       ROLL         (5)         247      125
Revlon Inc. - A         REV      (1,102)         925       70
Riviera Holdings        RIV         (27)         216        5
Rural/Metro Corp.       RURL       (184)         221       18
Ruth's Chris Stk        RUTH        (49)         110     (22)
SBA Comm. Corp.-A       SBAC        (50)         857       19
Sepracor Inc.           SEPR       (201)       1,175      717
St. John Knits Inc.     SJKI        (52)         213       80
US Unwired Inc.         UNWR        (76)         414       56
Vector Group Ltd.       VGR         (33)         527      173
Verifone Holding        PAY         (36)         248       48
Vertrue Inc.            VTRU        (48)         447      (96)
Weight Watchers         WTW         (36)         938     (266)
Worldspace Inc.-A       WRSP     (1,720)         560   (1,786)
WR Grace & Co.          GRA        (605)       3,423      811


                          *********

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

Each Tuesday edition of the TCR contains a list of companies with
insolvent balance sheets whose shares trade higher than $3 per
share in public markets.  At first glance, this list may look like
the definitive compilation of stocks that are ideal to sell short.
Don't be fooled.  Assets, for example, reported at historical cost
net of depreciation may understate the true value of a firm's
assets.  A company may establish reserves on its balance sheet for
liabilities that may never materialize.  The prices at which
equity securities trade in public market are determined by more
than a balance sheet solvency test.

A list of Meetings, Conferences and Seminars appears in each
Wednesday's edition of the TCR. Submissions about insolvency-
related conferences are encouraged. Send announcements to
conferences@bankrupt.com/

Each Friday's edition of the TCR includes a review about a book of
interest to troubled company professionals. All titles are
available at your local bookstore or through Amazon.com. Go to
http://www.bankrupt.com/books/to order any title today.

Monthly Operating Reports are summarized in every Saturday edition
of the TCR.

For copies of court documents filed in the District of Delaware,
please contact Vito at Parcels, Inc., at 302-658-9911. For
bankruptcy documents filed in cases pending outside the District
of Delaware, contact Ken Troubh at Nationwide Research &
Consulting at 207/791-2852.

                          *********

S U B S C R I P T I O N   I N F O R M A T I O N

Troubled Company Reporter is a daily newsletter co-published by
Bankruptcy Creditors' Service, Inc., Fairless Hills, Pennsylvania,
USA, and Beard Group, Inc., Frederick, Maryland USA. Yvonne L.
Metzler, Emi Rose S.R. Parcon, Rizande B. Delos Santos, Jazel P.
Laureno, Cherry Soriano-Baaclo, Marjorie Sabijon, Terence Patrick
F. Casquejo, Christian Q. Salta, Jason A. Nieva, Lucilo Junior M.
Pinili, and Peter A. Chapman, Editors.

Copyright 2005.  All rights reserved.  ISSN: 1520-9474.

This material is copyrighted and any commercial use, resale or
publication in any form (including e-mail forwarding, electronic
re-mailing and photocopying) is strictly prohibited without prior
written permission of the publishers.  Information contained
herein is obtained from sources believed to be reliable, but is
not guaranteed.

The TCR subscription rate is $675 for 6 months delivered via e-
mail. Additional e-mail subscriptions for members of the same firm
for the term of the initial subscription or balance thereof are
$25 each.  For subscription information, contact Christopher Beard
at 240/629-3300.

                *** End of Transmission ***