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T R O U B L E D   C O M P A N Y   R E P O R T E R
      
       Friday, July 24, 1998, Vol. 2, No. 144
                    
                  Headlines

2CONNECT EXPRESS: Court Approves Disclosure Statement
APS HOLDING: Has Nod To Hire Blackstone
ALLEGHENY HEALTH: State Attorney General To Intervene
BARNEY'S: Seeks Extension of Exclusivity
BUILDERS TRANSPORT: Seeks Appointment of Responsible Person

CAMPO ELECTRONICS: Committee Seeks Counsel
COLOR TILE: Seeks Extension of Exclusivity Until Jan. 11
D&L VENTURE: Debtors Tap Noari Capital Corp
FPA MEDICAL: Interim Approval to Borrow Up to $34 Million
GOLDEN BOOKS: Investor Group To Invest Up To $25 Million

GEOTEK: Trustee Names Geotek Creditor Panel
GIBSON'S HOLDING: Seeks Time to Assume or Reject Leases
GOLF TRAINING: Default Continues; CEO Gordon Resigns
GREATE BAY HOTEL: Seeks Extension of Exclusivity
KOMAG INC: Stockholders Approve Proposals

MOLTEN METAL: Seeks Authority for Accountant and Auditor
MOTOROLA: Cross-Licensing Deal with AMD
OXFORD HEALTH: Letter Warns of Payment Cuts
RUSSELL CORP: Announces 19% Drop in Earnings
UNITED INFORMATION SYSTEMS: Files For Bankruptcy Protection
WORLD AIRWAYS: Says No Need For Concern

DLS CAPITAL PARTNERS: Bond Pricing For Week of July 20

                  *********


2CONNECT EXPRESS: Court Approves Disclosure Statement
--------------------------------------------- --------
On June 16, 1998, the Bankruptcy Court approved
the Debtor's amended  Disclosure Statement.


APS HOLDING: Has Nod To Hire Blackstone
---------------------------------------
APS Holding Corp. has received court authorization to hire
investment banker Blackstone Group L.P. The auto parts
distributor retained the firm after receiving a number of
unsolicited bids for all or parts of the company.
Blackstone will assist with operating and financial
strategies for APS and provide advisory services in
connection with a potential sale. (The Daily Bankruptcy
Review Copyright c July 23, 1998 - ABI 23-July-98)


ALLEGHENY HEALTH: State Attorney General To Intervene
-----------------------------------------------------
State Attorney General Mike Fisher will intervene in the
bankruptcy of Allegheny Health, Education and Research
Foundation, in an effort to protect its charitable assets
from creditors.

Fisher, a Republican from Upper St. Clair, also wants his
office to review the proposed sale of AHERF's nine
hospitals in the Philadelphia region, his office said
yesterday.

"The attorney general plans on asking the Bankruptcy Court
to segregate the charitable assets to ensure that they
cannot be used to pay the debts owed the creditors,"
spokesman Sean Connolly said. "He has also directed his
attorneys to develop an approach to ensure that his office
maintains legal standing to  review the proposed sale of
AHERF hospitals."

Since March, Vanguard and AHERF had been negotiating over
the sale of six of AHERF's Philadelphia-area institutions,
but that initial deal - estimated to bring the foundation
close to $400 million - fell apart because of differences  
over "several fundamental issues, including the final sale
price," according to an announcement by both sides. They
did not elaborate. (Pittsburgh Post Gazette - 07/22/98)


BARNEY'S: Seeks Extension of Exclusivity
----------------------------------------
The debtors, Barney's Inc. et al., seek an extension of
their exclusive periods to file and/ or advance their plan
or plans of reorganization and solicit acceptances and a
further extension of their time to file a disclosure
statement.

The debtors seek an additional 120-day extension of the
time periods to advance a plan and solicit acceptances to
the plan; through and including November 30, 1998 and
January 29, 1999 respectively.

The debtors believe that an additional 120-day extension is
essential to the efforts of the debtors, the Creditor
Group, and other major constituencies in these cases to
effectuate filing and confirming a consensual plan in the
near future.

It is the debtors understanding that the Creditor Group
will be filing the proposed creditor group plan during the
next 60 days.

The debtors state that they have fully cooperated with all
of the major constituencies in these cases and that the
termination of the exclusive periods at a time when the
proposed creditor group plan is close to being filed, with
the consent and support of the Committee, Isetan and the
debtors, will disrupt the investor plan process and could
impair the dramatic business and financial turnaround that
the debtors have enjoyed during the last 10 months.


BUILDERS TRANSPORT: Seeks Appointment of Responsible Person
-----------------------------------------------------------
Builders Transport and its affiliated companies, as
debtors, seek the appointment of a Responsible Person to
run the debtors through the balance of their chapter 11
cases.

The court has ordered that the debtors' assets be sold to
Schneider National, Inc. Schneider designated which of the
debtors' employees and operations it wished to have the
debtors continue pending closing of the sale on July 31,
1998. None of the debtors' senior management is included in
the group of employees to be continued.  Consequently, all
members of the debtors' senior management have resigned or
have indicated they intend immediately to resign.  The
appointment of a Chapter 11 trustee in this case is not
economically rational or justifiable.   The debtors ask
that Michael Guthrie, currently debtors' Chief Financial
Officer be appointed Responsible Person.


CAMPO ELECTRONICS: Committee Seeks Counsel
------------------------------------------
On June 22, 1998, the Unsecured Creditors' Committee of
Campo Electronics was authorized by U.S. Bankruptcy Judge
T.M. Brahney, III to retain Joseph E. Friend, Stephen F.
Chiccarelli and the law firm of Breazeale, Sachse & Wilson
LLP under general retainer as attorneys in all matters
relating to the performance of its duties as the Unsecured
Creditors' Committee.


COLOR TILE: Seeks Extension of Exclusivity Until Jan. 11
--------------------------------------------------------
Color Tile is seeking an extension of its exclusive period
for filing a reorganization plan to Jan. 11 to allow the
creditors' committee to continue to investigate claims and
causes of action against prepetition transferees and other
third parties.

The 180-day extension will not prejudice any party, and
will permit Color Tile and the committee to maximize the
estate's value, the former floor-covering retailer said.
(Federal Filings Inc. 22-July-98)


D&L VENTURE: Debtors Tap Noari Capital Corp
-------------------------------------------
The debtors, D&L Venture Corp., et al., apply for authority
to employ Noari Capital Corp as their investment banker in
connection with exploring options for a transaction or
combination of transactions to obtain capital for the
debtors.  The debtors have agreed to pay Noari an Advisor y
Fee in an amount equal to the greater of $125,000 or 6.5%
of any capital involved in any transaction.  


FPA MEDICAL: Interim Approval to Borrow Up to $34 Million
---------------------------------------------------------
FPA Medical Management Inc. has interim approval to borrow
up to $34 million under its $50 million debtor-in-
possession credit facility with BankBoston N.A. as agent.
After granting interim approval Monday, the U.S. Bankruptcy
Court in Wilmington, Del., scheduled an Aug. 10 final DIP
hearing. The proposed DIP financing is the only way to
avoid "immediate and irreparable harm" to reorganization
efforts as well as conversion to Chapter 7 liquidation, the
physician management company warned. (Federal Filings Inc.
22-July-98)


GOLDEN BOOKS: Investor Group To Invest Up To $25 Million
--------------------------------------------------------
Golden Books Family Entertainment, Inc.  (NASDAQ GBFE)  
announced today that Golden Press Holdings, L.L.C., an
investor group including Warburg, Pincus Ventures,  L.P.,
Barry Diller and Golden Books' Chief Executive Officer,  
Richard E. Snyder, has committed to invest up to $25
million in Golden Books Family Entertainment,  at the
Company's option.  Although Golden Books has no immediate  
plans to draw down any funds,  such funds  will be
available to the Company over the next year.

In exchange for any funds drawn down, Golden  Press  
Holdings will receive  convertible  preferred stock with a
coupon of 5% and a conversion price of $4.87,  a 20%
premium over the average price of Golden Books common stock
for the five days preceding this announcement.


GEOTEK: Trustee Names Geotek Creditor Panel
-------------------------------------------
The U.S. Trustee acting in Geotek Communications Inc.'s
chapter 11 proceedings appointed an official committee of
unsecured creditors: Bank of New York; Mitsubishi Consumer
Electronics America Inc.; IBM Corp.; Analog Devices Inc.;
Decision Systems Israel Ltd.; PSI Business Computers Inc.;
and Arthur Andersen LLP. The committee has retained Baker &
McKenzie as counsel. (The Daily Bankruptcy Review Copyright
c July 23, 1998 - ABI 23-July-98)


GIBSON'S HOLDING: Seeks Time to Assume or Reject Leases
-------------------------------------------------------
The debtors, Gibson's Holding Company, et al., are seeking
an order further extending their time to assume or reject
unexpired non-residential real property leases.  
The debtors are currently party to 24 unexpired non-
residential property leases subject to assumption or
rejection.  21 of the leases are for store locations at
which the debtors are currently conducting retail
operations.  The remaining leases are for warehouse space
related to the debtors' business operations.

On June 22, 1998 the court considered the debtors'
Disclosure Statement.  Although a small number of details
remain to be fully documented, the debtors hope to confirm
their plan in the third quarter of 1998.

Unless and until the debtors' plan is confirmed the debtors
cannot assume ore reject their leases without the risk of
prematurely assuming leases that the debtors later discover
are burdensome or prematurely rejecting leases that the
debtors later discover would have been beneficial to their
operation.

The debtors request that the court enter an order granting
the debtors a further extension of time through and
including October 15, 1998 to assume or reject each lease.
Without such an extension the debtor would be required to
make final decisions with respect to all of the leases by
July 17, 1998.


GOLF TRAINING: Default Continues; CEO Gordon Resigns
----------------------------------------------------
Golf Training Systems, Inc. (OTC Bulletin Board: GTSX)(GTS)
announced today that Daniel A. Gordon has resigned as Chief  
Executive Officer effective August 1, 1998.  Gordon will
continue to serve as an outside director of GTS, the
position he held prior to becoming CEO in February, 1997.

GTS remains in default of its obligation to pay principal
and interest due on its secured loan agreement with
Meadowcroft Golf Associates, Inc.

"While various alternatives were being explored, it became
obvious that reducing operating expenses through downsizing
and other cost reductions would be appropriate under any
scenario, " said Gordon.  "With the softness in the  
golf market affecting our retail store sales, and the lead
time needed to develop Coach sales through our redeveloped
web site, we have been unable to attain revenue levels
which justify our cost structure.  The gross margin  
improvement we have achieved must now be combined with a
leaner operating budget.  As the result of eliminating
certain positions, including mine, and changing other
compensation plans, we have reduced personnel costs by over
40  percent."

The common stock of GTS was delisted from the Nasdaq Small
Cap Market on July 17, 1998 because it was out of
compliance with applicable net tangible assets, market
price and market value of public float requirements.  The
common stock is eligible for trade on the OTC Bulletin
Board.


GREATE BAY HOTEL: Seeks Extension of Exclusivity
------------------------------------------------
The debtors, Greate Bay Hotel and Casino, Inc., GB
Holdings, Inc., and GB Property Funding Corp., are seeking
an order for a second extension of the debtors' exclusive
periods of time within which to file a plan of
reorganization and solicit acceptances thereof.

The debtors' exclusive periods to file a plan or plans of
reorganization expire on August 10, 1998.  the debtors'
exclusive solicitation periods terminate on October 9,
1998.  By this motion, the debtors seek a 90 day extension
of these deadlines to November 9, 1998 and January 8, 1999,
respectively.  The debtors require an extension to conclude
negotiations with potential plan funders and creditors
toward a consensual reorganization.

    The debtors resolved on an interim basis significant
aspects of a highly contentions motion to reject a
management services agreement.  The debtors have a large
number of personal injury claimants in more than 100 proofs
of claim.  The debtors are also involved in significant
discussion with their major bondholder creditors on issues
concerning strategies for emergence from Chapter 11.  In
particular, the debtors have been involved in discussions
with a merchant bank affiliate of an institutional investor
concerning their interest in filing a plan of
reorganization.  The debtors have also begun discussions
with another substantial financial source.  

The debtors state that they have made substantial progress
including the suspension of the management agreement, the
elimination of conflicts of interest emanating from the
parent company and affiliates and the resolution of the
rights of the debtor in the Software.  The debtors submit
that substantial cause exists to further extend the
exclusive periods to file and solicit acceptances of a plan
of reorganization.  The debtors' motion will be heard on
August 10, 1998.


KOMAG INC: Stockholders Approve Proposals
-----------------------------------------
Komag, Incorporated (Nasdaq: KMAG) today announced that its
stockholders approved by substantial margins two proposals
that will provide the company with additional flexibility
to meet the  financing requirements of its business. The
first proposal increases the amount of common stock the
company is authorized to issue from 85 million
shares to  150 million shares. The second proposal
authorizes the sale and issuance of up to $350 million of
common stock in equity and/or equity-linked
private  financing transactions at a price below book value
but at or above the then current market price of the common
stock.

"In addition to intensified efforts to conserve cash in our
business operations, we are actively exploring a variety of
financing alternatives to enhance the company's balance
sheet during this difficult period in the disk
media industry. An equity or equity-linked private
financing transaction represents one such alternative. The
passage of the two proposals at today's special meeting of
stockholders simply authorizes the use of this alternative  
as part of any financial restructuring subject to the
discretion of the company's management and board of
directors. We believe that any financial restructuring
should allow for sufficient operating flexibility, provide  
lenders with appropriate returns, and minimize stockholder
dilution," said Stephen C. Johnson, president and chief
executive officer of Komag, Incorporated.

The company ended the second quarter of 1998 with $149.8
million in cash and investments. The company's second
quarter loss of $261.9 million resulted in a default under
certain financial covenants contained in the company's  
various bank credit facilities. The company is not in
payment default under any of these facilities. The company
currently has $260 million of bank borrowings outstanding.
The company is in discussions with current lenders to
re-negotiate the terms of these existing agreements.


MOLTEN METAL: Seeks Authority for Accountant and Auditor
--------------------------------------------------------
Molten Metal Technology, Inc. and its affiliates seek
authority to employ the accounting firm of Coulter &
Justus, PC as its outside accountant and auditor.  The firm
requests a retainer of $35,000.

The firm has indicated to the company that it anticipates
the costs to be incurred over the next 4 months in
preparation of the reviews required by the Lenders will be
approximately $70,000. The firms hourly rates range from
$60 to $215 per hour.


MOTOROLA: Cross-Licensing Deal with AMD
---------------------------------------
Motorola Corp. has agreed to share with Advanced Micro
Devices Inc. its method for making microprocessors with
copper, intensifying an industry drive to improve
performance for an array of computers and electronics
products.

The agreement, part of a broad technology swap the
companies announced Monday, is critical to AMD's struggle
to compete against Intel Corp., whose microprocessors are
the brains in 90 percent of all personal computers.

AMD and other chipmakers are rushing to overhaul their
manufacturing processes to handle copper after
International Business Machines Corp. disclosed last year
that it found a way to switch from aluminum, long the metal
of choice in chips. Copper carries electrical signals
faster than aluminum, but chipmakers needed to figure out a
way to keep the metal from contaminating a microprocessor's
silicon surface.

In exchange for getting Motorola's technology, Sunnyvale,
Calif.- based AMD will share its manufacturing process for
making "flash" memory chips, the circuitry that lets
computers and other devices hold information even when  
they're turned off. The chips are heavily used in
electronics gear such as digital cameras, which store
images as computer code even when the battery is  
idle. (Dallas Morning News; 07/21/98)


OXFORD HEALTH: Letter Warns of Payment Cuts
-------------------------------------------
Oxford Health Plans is planning to cut payments to  
doctors and raise premiums as it tries to become profitable
again. Oxford also said in a letter to doctors Monday that
is considering shrinking the size of its hospital network
and wants to discourage members from going to doctors  
outside its network. Benefits consultants say some
employers have been told to expect premiums to rise about
10 percent.


RUSSELL CORP: Announces 19% Drop in Earnings
---------------------------------------------
According to an article in The Wall Street Journal on July
23, 1998, Russell Corp., the maker of athletic wear
reported that earnings in the second quarter ended July 5
fell 19% to $6.6 million from $8.1 million a year earlier.  
Revenue was up to $271.8 million from $270.3 million.  
The company announced plans to eliminate about 4,000 jobs
or 23% of its work force.


UNITED INFORMATION SYSTEMS: Files For Bankruptcy Protection
-----------------------------------------------------------
United Information Systems Inc. (OTCBB:UISI) Wednesday
filed for protection under Chapter 11 in US Bankruptcy  
Court in Miami.

Both the holding company, United Information Systems Inc.
and its Miami-based operating subsidiary, United
Information Systems Inc. (UIS) filed petitions.  UIS is
seeking to reorganize its debt to creditors, including
accounts payable to its suppliers  of over $14 million.

In the court documents, UIS listed assets of $15 million
and liabilities of $15 million. Paul Orshan, an attorney
with Tabas, Freedman and Orsban, P.A., a Miami-based law
firm, is representing the company and UIS in
these proceedings.

Orshan stated that although a vendor's committee was formed
on July 7th to negotiate an out-of-court workout of UIS'
accounts payable delinquencies, not all of the suppliers to
UIS were willing to participate in this non-binding  
negotiation.

The company continues its manufacturing operations through
its Manaus, Brazil factory. Customer deliveries,
particularly to Brazilian retailing giants Carrefour and
Pao de Acucar, are being maintained on schedule.


WORLD AIRWAYS: Says No Need For Concern
---------------------------------------
World Airways, Inc. (Nasdaq: WLDA) announced that it
expects to report a loss of between $0.35 to $0.45 per  
share for the second quarter ended June 30, 1998.  The
company had reported a loss of $0.40 per share for the
first quarter of 1998, and analysts were expecting that the
company's second quarter loss would not be as large.

The company has faced problems with both a Florida-based
cargo company that had smaller needs than expected and a
wet lease agreement with a Brazilian carrier company that
has yet to be approved. Three new customers represent
potential long-term relationships.

Chairman and CEO Russell Ray said that World Airways has
continued to receive calls from investors regarding the
financial health of the Company.  "Questions regarding the
events of default of WorldCorp (NYSE: WOA), which owns 80%
of the entity that owns 50.18% of our common shares, has
created that confusion.  We ended the quarter with $9
million in cash as well as an unused line of credit of $25  
million.  We therefore believe that the concern for our
economic stability is unwarranted."

World Airways provides worldwide passenger and cargo air
transportation under contracts with major airlines, the
U.S. Air Force and tour operators.  Operating a fleet of
MD-11 and DC-10 aircraft, World is owned 51% by WorldCorp  
(NYSE: WOA), 17% by MHS Berhad (KLSE: MHS), a Malaysian
strategic investor, and 32% by public investors.


DLS CAPITAL PARTNERS: Bond Pricing For Week of July 20
------------------------------------------------------
Following are indicated prices for selected issues:

Amer Pad & Paper 13 '05                        47 - 49
Amer Telecasting 0/14 1/2 '04                  24 - 26
Asia Pulp & Paper 11 3/4 '05                   83 - 84
APS 11 7/8 '06                                  6 - 9 (f)
Boston Chicken 7 3/4 '04                       25 - 26
Brazos 10 1/2 '07                              72 - 74
Brunos 10 1/2 '05                              15 - 17 (f)
CAI Wireless 12 1/4 '02                        24 - 25
Cityscape 12 3/4 '04                           39 - 41 (f)
E&S Holdings 10 3/8 '06                        73 - 75
Grand Union 12 '04                             58 - 59 (f)
Greate Bay 10 7/8 '04                          85 - 86 (f)
Harrah's Jazz 14 1/4 '01                       29 - 31 (f)
Hechinger 9.45 '12                             76 - 77
Liggett 11 1/2 '99                             73 - 75
Mobilemedia 9 3/8 '07                          44 - 46
Penn Traffic 9 5/8 '05                         35 - 36
Royal Oak 12 3/4 '06                           83 - 85
Service Merchandise 9 '04                      73 - 74
Zenith 6 1/4 '11                               33 - 35(f)

   


                  *********

The Meetings, Conferences and Seminars column appears in
the TCR each Tuesday.  Submissions via e-mail to
conferences@bankrupt.com are encouraged.

Bond pricing, appearing each Friday, is supplied by DLS     
Capital Partners, Dallas, Texas.

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.,
Princeton, NJ, and Beard Group, Inc., Washington, DC.  
Debra Brennan and Lexy Mueller, Editors.   

Copyright 1998.  All rights reserved.  This material is
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in any form (including e-mail forwarding, electronic re-
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