You've got a bad .MAIL file in LISTSERV's spool that contains mail-merge commands. (Well, it's probably not a bad .MAIL file per se, but the point is that you aren't using LSMTP as your outbound mailer, so it fails.) You can grep through the existing *.MAIL files in the spool for "XMRG" and identify the file or files causing the problem, then simply stop LISTSERV and remove the file(s) from the spool. Nathan