June 16, 2004

Senate's Daschle Says Still
Time for Asbestos Deal

There is still time for Congress to pass legislation
on asbestos reform this year, the Senate Democratic leader said on
Tuesday, Reuters reported. Sen. Tom Daschle (D-S.D.) acknowledged that
progress might be taking place 'at a snail's pace,' but said he and
Senate Republican Leader Bill Frist (R-Tenn.) were still seeking a
bipartisan consensus on setting up a national fund to pay asbestos
victims' claims. 'We aren't going to give up until it's absolutely clear

that there is no possibility of achieving agreement,' Daschle said. 'We
still have time, and if it's a bipartisan agreement that Senator Frist
and I feel comfortable proposing to our caucus, I think we can pass it
in a reasonable period of time and get it over to the House (of
Representatives).' Daschle said. 'And if they could see fit to do the
same, we could still get it on the president's desk this year, and
that's
my hope,' Daschle added, the newswire reported.

Pension Conversion Issue Back to Congress



Lawmakers yesterday vowed to renew their efforts to craft legislation to

govern companies seeking to switch from traditional pension plans to
less-expensive 'cash balance' accounts after the Treasury Department
withdrew proposed rules that would have allowed such conversions,
CongressDaily reported. Conversions to
cash balance plans are controversial because critics claim they
disadvantage older workers whose retirement benefits grow the most at
the end of their careers. Following age discrimination lawsuits, the
Treasury imposed a moratorium on cash balance conversions in 1999, and
the 2002 proposed rules were intended to allow them to go forward
again.

Work on cash balance
legislation already was underway in both chambers. House Education and
the Workforce Chairman John Boehner (R-Ohio) had scheduled a hearing on
the topic next month, and plans to include cash balance plans in
comprehensive pension legislation he is preparing for debate next year,
the newswire reported.



Enron Bankruptcy Plan Short on Details, Critics
Say

Enron's plan to exit its bankruptcy lacks important
financial information and shouldn't be approved, some of the company's
creditors told a U.S. judge on Monday, Reuters reported. Enron, which
owes creditors more than $74 billion, failed to provide a detailed
liquidation analysis as well as its methodology for determining how much

creditors would receive under the plan, the creditors said during the
seventh day of hearings to consider confirmation of the plan in
bankruptcy court in New York.

Enron is trying to win confirmation of its plan in
order to exit from bankruptcy this year and begin paying creditors in
early 2005. While most of its creditors have voted in favor of the plan,

some still question whether creditors wouldn't receive more money if a
court-appointed trustee liquidates the company, the newswire
reported.

Public Company
Bankruptcy Filings Declining

Greater pricing power and improving corporate
profitability will take the number of U.S. companies filing for
bankruptcy to a six-year low this year, according to a new report. A
report (the
Phoenix Forecast) by PricewaterhouseCoopers (PwC) predicts just 110
groups will file this year, part of a continuing decline in the
bankruptcy rate. Last year, 133 companies filed, a drop of nearly half
from 2001, when a record 257 companies went bust.

PwC said the size of groups involved in bankruptcies
was also likely to fall this year. In 2003, only energy supplier Mirant
ranked among the top 50 bankruptcies since 1970. In 2001, 11 groups made

the top 50, led by Enron. Twelve, including WorldCom, made it in 2002.
The biggest improvements this year are likely to be among airlines,
health care companies and computer hardware and software producers,
according to the report.

The upturn began in the second
half of last year, when unexpectedly strong economic growth and
still-falling borrowing costs helped the rate of bankruptcies in the
second half of the year fall to 52 from 88 in the first six months, PwC
said.

SEC, Bankruptcy Judge Seen
in Parallel MCI Probes

The Securities and Exchange
Commission and a federal judge have launched 'parallel' probes of
WorldCom Inc.'s use of a tax shelter, according to sources familiar with

the matter, who said this could strengthen the states' back tax claims,
Reuters reported. More than a dozen U.S. states have sued WorldCom (MCI
Inc.), charging that the telecommunications company used the shelter to

dodge taxes, the newswire reported. The states' claims could add up to
$2.75 billion.

U.S. District Court Bankruptcy
Judge Arthur Gonzalez has now committed himself to reviewing the same 35

boxes of documents from WorldCom and KPMG as the SEC, said the sources,
who declined to be named, Reuters reported. Yet undertaking the same
review could put the judge in a tough spot, according to the newswire.
If Gonzalez denies the states' claims, he runs the risk of having the
SEC later reach the opposite conclusion. The SEC's probe is expected to
take several months, according to the sources. Gonzalez had appeared
likely to deny the states' claims, the sources said, noting he had
denied the states' request for discovery.

Delta CEO: Airline Can't
Survive as Is

Delta Air Lines CEO Gerald
Grinstein said on Wednesday it is 'completely clear' the airline cannot
survive as is as fare levels continue to erode despite an improving
economy, Reuters reported. But he said chapter 11 bankruptcy protection
would only be used if no other path were available.
face='Times New Roman' size='3'>Speaking at a transportation conference
in New York, Grinstein said the company's access to capital markets for
money has 'virtually disappeared' and that it will not accept
concessions from unionized pilots that provide only a partial solution
to the airline's cost problem. A company review he began in January is
expected to be complete by the second or third week of August, Grinstein

added, the newswire reported.

Pegasus Satellite Sues
DirecTV, Telecoms Co-Op

Pegasus Satellite Television said it filed suit on Monday in
bankruptcy court against DirecTV Group Inc. and the National Rural
Telecommunications Cooperative (NRTC), alleging the two companies sought

'to destroy' Pegasus, Reuters reported. Pegasus Satellite, a unit of
Pegasus Communications Corp., filed for bankruptcy on June 2 after
DirecTV and the NRTC agreed to dissolve an agreement giving it the
exclusive right to distribute DirecTV television service to 8 million
rural homes in 42 states. A bankruptcy court judge ruled that DirecTV
had not violated a bankruptcy court ruling by competing with Pegasus for

subscribers in those areas. Pegasus is seeking an injunction preventing
DirecTV and the NRTC from terminating their contract as well as punitive

and actual damages, the newswire reported.