/raid1/www/Hosts/bankrupt/TCR_Public/990813.MBX    T R O U B L E D   C O M P A N Y   R E P O R T E R
        Friday, August 13, 1999, Vol. 3, No. 156                                              

AMERITRUCK: Emergency Application To Approve Special Advisor
AMPACE CORP: Seeks To Reject Agreements Not to Compete
BARNEY'S: Sibling Rivalry - The Real Thing
BREED TECHNOLOGIES: PACE Finds Serious Violations
CENTRAL EUROPEAN MEDIA: CET 21 Pre-empts CNTS/Broadcasts Nova TV

CRIIMI MAE: Committee Opposes Reimbursement Of Expenses
EDISON BROTHERS: Agreement With G+G Retail
EDISON BROTHERS: Kress Stores Offers $350,000 To Purchase Leases
FEDERAL EMPLOYEES: Final Order Approves Postpetition Financing
FIRST ASSURANCE: Officers Prosecuted For Looting Company

FORSTMANN: Wins Interim Nod For $50M DIP Credit Facility
FWT INC: Motion To Extend Exclusivity
GULF STATES: Meeting of Creditors
HARNISCHFEGER: Seeks Court Authority To Employ Special Counsel
HECHINGER: Builders Square Employees Seek Class Proof of Claim

HECHINGER: Order Authorizes Retention of PWC For Committee
IRIDIUM: Defaults on Loans  
LA POSADA: Historic Hotel Files Chapter 11
MCA FINANCIAL: Fourth Amendment To Financing
MCGINNIS PARTNERS: Continued Hearing and Disclosure Statement

NEXTWAVE: Nextel Communications Reached Agreement With DOJ
PHP HEALTHCARE: Seeks To Sell Assets Of Health Cost Consultants
PLUMA INC: Court Authorizes Sale of Assets of Stardust Division
RINCON ISLAND: California State Lands Commission Clarifies Law

SERVICE MERCHANDISE: Statement of Operations For May
SMITH CORONA: Reports Net Income of $.6 Million In Fourth Quarter
SUN HEALTHCARE: To Remain Open Even In Bankruptcy
TRANSTEXAS GAS: Bondholders Object To Termination of Exclusivity
UNITED COMPANIES: Objections to Arthur Andersen For Equity

XENO TECHNIX: Notice of Conversion To Chapter 7 Case
XENO TECHNIX: Order Approves Employment of Accountant
Z. FREDERICK ENTERPRISES: Committee Seeks To Convert Cases

BOND PRICING: For Week of August 9, 1999


AMERITRUCK: Emergency Application To Approve Special Advisor
The debtors, Ameritruck Distribution Corp., seek authorization to
retain and employ Victor Bremson & Associates Inc. as general
financial advisor to the debtors.  Specifically, Bremson would
work directly with the debtors' management to assist in
streamlining the debtors' operations and to help direct the more
efficient operations of the debtors' businesses.  FINOVA and the
Official Committee of unsecured creditors support the
application.  Bremson charges $200 per hour.

AMPACE CORP: Seeks To Reject Agreements Not to Compete
The debtors, Ampace Corporation and Ampace Freightlines, Inc.
seek to reject the consulting agreements and agreements not to
compete known as the Jenkins Agreement and the Widener Agreement.  
Both agreements were executed by the debtors in connection with
their acquisition of other trucking businesses.  At the time of
these transactions, the debtors believed it was necessary to
obtain the consulting services of Jenkins, and the agreements
that neither of the parties would compete with the debtors.  At
this time, none of the services or agreements are necessary.

BARNEY'S: Sibling Rivalry - The Real Thing
The New York Times reports on August 12, 1999 that Robert
Pressman, a former owner of Barney's Inc., was accused by his
sisters yesterday of taking nearly $30 million they say was

According to the report, the two sisters, Elizabeth Pressman-
Neubardt and Nancy Pressman Dressler, claimed in a suit filed in
State Supreme Court in Manhattan that their brother took more
than his share from the family business and transferred cash to
the clothing store without their permission.

The lawsuit said Robert Pressman took most of $17.5 million
generated from partnerships belonging to him, Ms. Pressman-
Neubardt and Ms. Pressman Dressler, and his brother, Gene, though
the cash should have been divided equally among the four.

Robert Pressman also transferred $24 million from a mortgage
refinancing without permission, including the sisters' $12.25
million share, the suit said.

BREED TECHNOLOGIES: PACE Finds Serious Violations
PACE International Union today released the following:
PACE International Union has released a review of hazardous
materials and waste practices of Breed Technologies, Inc. (NYSE:
BDT), finding serious violations and incidents, as well as
unaccounted-for waste, at the company's Florida operations.  The
report calls for tracking of the wastes to their disposal point,
to ensure that the taxpayers or purchasers of the company do
not end up picking up the tab of any cleanup.
The questions raised by PACE about the company's handling of
acutely toxic sodium azide, used in automotive air bags, come
amid Breed Tech. plant closures and its financial restructuring,
which may possibly include bankruptcy.  PACE has organized
outreach efforts to Breed workers in all three NAFTA countries.

"To the thousands of workers fired, exposed to serious hazards or
laid off in Breed Technologies plant closures we say, you're not
alone," said PACE International Union President Boyd Young.  "The
sordid reality of NAFTA is that communities, shareholders and
taxpayers are left to clean up the mess when companies move out
or, as in the case of Breed, simply fail to succeed in
the competitive arena."
Noted corporate accountability attorney Sanford Lewis prepared
the assessment of environmental issues at Florida, Indiana and
Tennessee Breed Tech. plants for PACE.  In releasing the report,
the union also pointed to Breed's errors in financial disclosures
required by the Securities and Exchange Commission.  The company
was placed on credit watch in June. Attorney Lewis recommended
that lenders assessing the company's future and any potential
purchasers track down the wastes in question to assess whether
there are potential long-term liabilities. "Lenders or purchasers
may be able to insist on disclosure of the ultimate disposition
of the wastes," said Lewis. "Another possibility is for the U.S.
Environmental Protection Agency to investigate."
PACE cited documents reporting a high volume of materials
containing highly toxic sodium azide going from Breed Tech.'s
Lakeland, Fla., operations to waste disposal facilities for
"storage and transfer."  A loophole in federal hazardous waste
laws allowed Breed to omit reporting the final disposition of
those wastes, and any potential liability associated with them.

In addition, in reporting year 1993 a discrepancy of almost one
ton of wastes is not explained. The EPA classifies sodium azide
as an acutely toxic hazardous chemical, and its pathways to harm
humans include the central nervous system, kidneys
and cardiovascular system.  "It may be that the wastes were
shipped to another location for incineration," Lewis said. "But
using a transporter such as Laidlaw does not release Breed from
eventual liability if the disposal causes harm."

As reported in Chemical Week, some manufacturers including
Mercedes Benz have taken special steps because sodium azide is
highly explosive.  The Florida Breed Tech. facility had several
serious accidents with sodium azide, with a "premature
deployment" in building 7 resulting in the death of an
employee on Jan. 9, 1996.  There were three other explosions and
fires later that year.     

Breed's 1995 biennial waste disposal report shows 28.11 tons of
toxic solid waste from cleaning operations contaminated with
sodium azide, plus 17.6 tons of "rejects and scrap from
processing" likewise contaminated.  These were sent to Laidlaw
Environmental Services in Clearwater, Fla., for "storage
and transfer."  Other environmental problems identified by PACE
cover waste storage and shipment problems at Breed Tech.'s
Knoxville, Tenn., and Grabill, Ind., plants.

In releasing the environmental assessment, PACE also pointed to
"supplemental disclosures" the company made last September under
pressure from the SEC.  The company agreed to "restate its
financial statements for certain prior periods" because it had
failed to disclose to shareholders vital information impacting
its prospects.
Unions and other groups in the U.S., Canada and Mexico have
pressured the company to reinstate 28 workers who were fired in a
May 1997 strike at the company's plant in Valle Hermoso, Mexico.  
PACE and the Canadian Steelworkers built solidarity with the
Mexican workers through the San Antonio, Texas-based Coalition
for Justice in the Maquiladoras as Breed downsized and eventually
closed facilities the unions represented.  The company bought
Canadian company Custom Trim in 1997, and also acquired major
automotive operations of United Technologies and Allied Signal.
In the wake of these, Breed's stock price has fallen to under $2
after fetching as much as $35-per-share five years ago.

PACE, based in Nashville, represents 320,000 workers in paper,
oil, chemical, automotive supply and other manufacturing

CENTRAL EUROPEAN MEDIA: CET 21 Pre-empts CNTS/Broadcasts Nova TV
Dateline: PRAGUE, Czech Republic, - Central European Media
Enterprises Ltd.  announces that broadcast operations at its 99%-
owned Czech subsidiary, Ceska nezavisla televizni spolecnost,
spol. sr.o. have been interrupted by CET 21, spol. sr.o.,
which pre-empted CNTS's transmission and began broadcasting
a substitute signal for Nova TV from a site other than CNTS
studios the morning of August 5th. CNTS and CME have urgently
requested the Czech Media Council to call an extraordinary
meeting to address breaches of the Czech media laws and
destablization of the Czech media market.

In a statement issued today, Fred Klinkhammer, President
and Chief Executive Officer of CME stated: "This action
by CET 21 constitutes a massive breach of our most basic
agreements with CET 21, violates the Czech media laws, the
terms of the broadcast license and the Czech Media Counc
il's recent instruction to the parties to work together to
resolve their disputes and not to disrupt normal broadcasting
of Nova TV. The time has come for the Czech Media Council
to recognize that CET 21 is flaunting its legal obligations
and holding the Czech public hostage to the ego of one man,
Dr. Vladimir Zelezny. We have worked to resolve any disputes
with CET 21 and Dr. Zelezny within the legal framework of our
agreements and the Czech Media Council's requirements. Dr.
Zelezny has refused our offers to negotiate and CET 21 has
now violated CNTS's copyrights, trademarks and licenses
by producing television programs registered to CNTS and
jeopardized the operations of CNTS, the largest commercial
television company in the Czech Republic. I urgently call upon
the Czech Media Council and other governmental authorities to
take strong action to enforce Czech media laws, and the terms
of the broadcast license, and to protect the Czech public
from being held hostage by these actions. CNTS and CME will
continue to take all available steps to enforce their legal
rights, including rights arising under international treaties
for the protection of foreign investment."

CET 21, CNTS, CME and Dr. Vladimir Zelezny, the executive
officer of CET 21, are engaged in an ongoing dispute with
respect to the operations of Nova TV and the rights and
obligations of each of CET 21 and CNTS. On April 19, 1999,
Dr. Zelezny was recalled as General Director and Executive
of CNTS for breaching his fiduciary duties and acting against
the interests of CNTS.

Under the CNTS Memorandum of Association and a Services
Agreement dated May 21, 1997, CNTS has provided substantially
all television and advertising sales services to CET 21 for
Nova TV. On June 10, 1999, Dr. Zelezny announced that CET 21
has reached an agreement with another Czech company to provide
television services to CET 21 and that CNTS would no longer
be the exclusive provider of television services to CET 21
for Nova CET 21 is now producing and broadcasting programs as
to which CNTS has registered with Czech trademark authorities
production and other intellectual property rights. CNTS has
notified CET 21 that it is violating CNTS's rights to such
programs and will promptly file requests for preliminary
injunctions against CET 21's further production and broadcast
of such programs.

Since the dismissal of Dr. Zelezny, CET 21 and CNTS have
filed a number of lawsuits with respect to their contractual
relationship. CNTS intends to file a preliminary injunction
with the Czech courts to enforce its rights to be the
exclusive provider of such services to CET 21 for Nova TV
under the Services Agreement, and will seek a court injunction
prohibiting CET 21 from entering into agreements for the
provision of similar services from third parties. CET 21 has
filed a petition with the Regional Commercial Court in Prague
to declare the Services Agreement invalid, which is pending.

In June 1999, the Media Commission of the Czech Parliament
requested the Czech Media Council to provide its opinion
regarding several issues related to the dispute, including
whether CNTS is entitled to be the exclusive provider of
television services to CET 21 for Nova TV. On July 26, 1999,
the Czech Media Council sent CNTS excerpts of its report
to the Media Commission. In the excerpts of its report,
the Media Council stated its view that the dispute between
CET 21 and CME was essentially of a commercial nature and,
as long as Czech media laws were not violated, that the Media
Council had no legal reason or right to intervene. The report
referred to several possible risks of breaches of the Czech
media laws arising from the dispute, including destablization
of the Czech media environment, and asked CET 21 and CNTS to
immediately cease their media campaigns and to inform the
Media Council before August 15, 1999 of the steps taken to
minimize risks of media law violations and towards settlement
of the dispute. CNTS and CME responded to the Media Council
that they will comply with the Media Council's request and have
offered to recommence negotiations to resolve the disputes with
Dr. Zelezny and CET 21. CNTS and CME, however, expressed their
disagreement with the Media Council's characterization of the
disputes as essentially commercial in nature, pointing out that
the Media Council has been intimately involved in approving the
structure of the legal relationships between CET 21 and CNTS,
and, in fact, mandated many of the contractual changes that
gave rise to the current disputes. In response to CME's offer
to immediately commence negotiations to resolve the disputes,
counsel to CET 21 wrote that the disputes were currently in
litigation and indicated no interest in negotiation.

The company indicates it believes that the recent actions
by CET 21 violate the Services Agreement and CET 21's
obligations under the CNTS Memorandum of Association, as
well as Czech media laws. If CNTS's operations continue to be
interrupted, CNTS's advertising revenues could be disrupted
or curtailed entirely, and CNTS's business operations could
be suspended. CNTS contributed $47.5 million of the company's
combined broadcast cash flow of $25.3 million in 1998 and
$3.4 million of the company's combined broadcast cash flow
of negative $3.5 million for the three-month period ended
March 31, 1999. Any significant disruption of CNTS's cash
flows would have a material adverse effect on the company
and could result in its inability to meet its debt service
and other financial obligations.

CME is the leading broadcaster in Central and Eastern Europe,
and operates eight television stations in six countries,
reaching an audience of 84 million people.

CRIIMI MAE: Committee Opposes Reimbursement Of Expenses
The Official Committee of Unsecured Creditors of CRIIMI MAE, Inc.
opposes the motion by the Management Committee to compel
reimbursement of administrative expenses incurred by CRIIMI MAE
Management, Inc. for the benefit of CRIIMI MAE, Inc. which was
filed by the Official Committee Unsecured Creditors of CRIIMI MAE
Management, Inc.

The Committee states that "the motion, which is devoid of legal
authority, seeks to enrich the bankruptcy estate of CRIIMI MAE
Management, Inc. at the expense of the creditors and shareholders
of CRIIMI MAE, Inc. by transferring Management's statutory
obligation to pay professional fees allowed as administrative
expenses in its bankruptcy case to CMI."

The Committee states that CMI and Management are two separate
debtor s and that CMI does not have any obligation to pay the
expenses incurred by Management.  Although CMI has historically
advanced funds to Management, there is no obligation to do so.  
The Committee also points out that Management is a solvent
debtor, able to pay its own professional fees and expenses, and
the issue of whether Management can assert an administrative
expense claim in the CMI case, for reimbursement of professional
fees paid by Management, does not need to be finally decided at
this point in the case.

EDISON BROTHERS: Agreement With G+G Retail
Judge Walrath granted the Debtors' request to enter into an
Assignment and Assumption Agreement with G+G Retail, Inc., and
consummate the sale of their interests in nine leases:
Sizes 5-7-9     Southwest Plaza, Littleton, CO          
J. Riggings     Oaks Mall, Gainesville, FL              
J. Riggings     Northpoint Mall, Alpharetta, GA         
Coda            Natick Mall, Natica, MA                         
J. Riggings     Northpark Mall, Ridgeland, MS          
J. Riggings     Chapel Hill Mall, Akron, OH             
J. Riggings     The Parks at Arlington, Arlington, TX     
J. Riggings     West Oaks Mall, Houston, TX             
J. Riggings     River Oaks, Calumet City, IL           

The Debtors tell Judge Walrath that Houlihan Lokey and Keen
Realty undertook an aggressive marketing campaign, shopping the
leases to scores of potential purchasers.  The Debtors are
convinced that G+G's offer of $371,000 is the highest and best
available to their estates.  

Judge Walrath granted the Debtors further authority, in
connection with the assignment of their leasehold interests, to
cure all prepetition obligations owed to their Landlords.  
(Edison Brothers Bankruptcy News Issue 32; Bankruptcy Creditors'
Services Inc.)

EDISON BROTHERS: Kress Stores Offers $350,000 To Purchase Leases
Kress Stores of Puerto Rico, Inc., offered $350,000 in cash to
purchase four J. Riggings Leases for stores located in Puerto
Rican shopping malls:

      (a) Plaza del Caribe in Ponce, Puerto Rico;

      (b) Montegiedra Town Center in San Juan, Puerto Rico;

      (c) Mayaguez Mall in Mayaguez, Puerto Rico; and

      (d) San Patricio Plaza in Guaynabo, Puerto Rico.

The Debtors accepted the offer.  Judge Walrath Granted the
Debtors the authority to assume the lease agreements, assign
their leasehold interests to Kress Stores, cure all pre-petition
lease-related obligations, and perform all other actions
necessary to consummate the transaction.  

FEDERAL EMPLOYEES: Final Order Approves Postpetition Financing
The court held a final hearing on August 4, 1999 to consider on a
final basis the emergency motion of the debtor, Federal
Employees' Distributing Company, d/b/a Fedco Inc. for interim and
final order approving postpetition financing and granting liens.  
By the interim order the court authorized the debtor to borrow up
to a maximum of $11,363,000.  The financing motion was granted on
a final basis.  The debtor is authorized to borrow money and seek
other financial accommodations from lenders up to a maximum of
$40 million under the DIP Facility.  The Facility Fee shall be $1

FIRST ASSURANCE: Officers Prosecuted For Looting Company
The President, auditor and a secretary-treasurer of First
Assurance & Casualty Co. Ltd. are being prosecuted for
looting the insurance company of nearly $ 7 million during a rare
bankruptcy proceeding.

Testimony indicated that all were officers in other companies
that prosecutors allege were used to siphon money from First
Assurance, an offshore company that filed for Chapter 11
reorganization in federal bankruptcy court in October 1993.

The trustee has alleged that the company's payments and receipts
were difficult to track down, and while normally First Assurance
would not be allowed to file bankruptcy since federal law, to
protect policyholders, bars insurance companies from seeking
protection from creditors, the case was allowed because Turks &
Caicos Islands, a British commonwealth, had suspended the
company's license to sell insurance.

FORSTMANN: Wins Interim Nod For $50M DIP Credit Facility
Forstmann & Co. has received interim approval to enter into a $50
million debtor-in-possession credit facility with Bank of America
NT & SA, pending a final hearing. In an Aug. 5 order, the U.S.
Bankruptcy Court in Manhattan concluded that, "Among other
things, entry of this order will minimize disruption of
Forstmann's business and operations and permit them to meet
payroll and other operating expenses, and maximize value for the
benefit of creditors." The order also noted that the objections
of the U.S. Trustee and creditor Newco Holdings LLC had been
resolved. (The Daily Bankruptcy Review Copyright c August 12,

FWT INC: Motion To Extend Exclusivity
FWT, Inc., debtor, states that it continues to negotiate toward
the settlement of contested issues which may facilitate a
consensual plan. The debtor states that the circumstances imposed
by creditors and the size of this case constitute cause to extend
the exclusivity deadlines.  

The debtor believes that it is possible to file the plan and the
disclosure statement on a timely basis and may do so while this
motion is pending.  However, the debtor requests an additional 60
days, being on or before October 13, 1999, during which time the
debtor has the exclusive right to file a plan, an additional
extension of 60 days being on or before December 13, 1999, during
which time the debtor has the exclusive right to pursue
confirmation of a plan.

GULF STATES: Meeting of Creditors
A meeting of creditors will be held in the case of Gulf States
Steel, Inc., of Alabama, debtor, on Monday August 30, 1999 at
10:30 AM, Gadsden Convention Hall, 334 South First Street,
Gadsden, AL

A bar date for filing proofs of claim or interest in this case
has been fixed on November 29, 1999.

HARNISCHFEGER: Seeks Court Authority To Employ Special Counsel
Nunc pro tunc to June 7, 1999, the Debtors seek the Court's
authority to employ Wachtell, Lipton, Rosen & Katz as special
counsel to perform corporate and strategic legal services they
will require during the course of these chapter 11 cases.  
Specifically, as more particularly described below, the Debtors
seek authorization for WLRK, their longtime legal
advisors with respect to matters of corporate law and strategy,
to advise senior management and the Board of Directors with
respect to mergers and acquisitions and other major corporate
transactions, corporate structure, corporate finance and capital
structure, and debt refinancing and restructuring, including such
of the foregoing matters as may arise in the formulation of a
plan of reorganization for the Debtors.

The Debtors have selected WLRK as special counsel to advise them
in connection with certain corporate and strategic aspects of
their reorganization because of WLRK's longstanding
representation of the Debtors and the firm's attendant intimate
knowledge of their businesses and affairs, as well as WLRK's
extensive experience and expertise in the fields of corporate and
transactional law and business reorganization.

For more than ten years, WLRK and certain of its members and
associates have rendered legal services to the Debtors and their
affiliates in connection with various corporate, litigation,
creditors' rights, and other related matters.  WLRK's corporate
services have included mergers and acquisitions, general
corporate and anti-takeover advice, takeover matters (such as a
takeover attempt of Giddings & Lewis and a consent
solicitation initiated by the Trinity Group), implementation of
executive compensation and benefits plans, negotiation of upper-
level employment agreements, and advice to senior management and
the Board of Directors in their efforts to resolve the Debtors'
financial difficulties outside of bankruptcy.  In addition to the
corporate and related advice previously described, the Debtors
note that commencing in approximately April of
1998, WLRK also represented the Debtors and certain of their
current and former officers and directors in purported
shareholder class action lawsuits that have been consolidated and
are currently pending in the United States District Court for the
Eastern District of Wisconsin as In re Harnischfeger Industries,
Inc. Securities Litigation, Civil Action No. 98-C-0524.

As a consequence, WLRK is intimately familiar with the complex
legal issues that have arisen and are likely to arise in
connection with the Debtors' corporate and debt structure, their
business and operations, their prospects for reorganization, and
their strategic and transactional goals.  The Debtors believe
that both the strategic interruption and the duplicative cost
involved in obtaining substitute counsel to replace
WLRK's unique role at this juncture would be extremely harmful to
the Debtors and their estates.  Were the Debtors required to
retain counsel other than WLRK in connection with the specific
and limited matters upon which the firm's advide is sought, the
Debtors, their estates and all parties in interest would be
unduly prejudiced by the time and expense necessary to replicate
WLRK's ready familiarity with the intricacies of
the Debtors' business operations, corporate and capital
structure, and strategic prospects.  

The Debtors currently seek to retain WLRK, subject to the
oversight and orders of the Court, to advise the Debtors and
their Board of Directors with respect to:

     (a) evaluation and negotiation of such mergers,
acquisitions, asset sales and other major corporate transactions
as may be proposed during the course of the chapter 11 cases;

     (b) corporate finance;

     (c) corporate and capital structure;

     (d) debt refinancing and restructuring; and

     (e) such of the foregoing matters as may arise in the
formulation of a plan of reorganization for the Debtors.

WLRK will not serve as bankruptcy and reorganization counsel to
the Debtors, and while certain aspects of the representations
will necessarily involve both WLRK and the Debtors' bankruptcy
and reorganization counsel, the Debtors believe that the services
WLRK will provide will be complementary rather than duplicative
of the services to be performed by bankruptcy and reorganization
counsel.  The Debtors are very mindful of the need to avoid
duplication of services, and appropriate procedures will be
implemented to ensure that there is minimal duplication of effort
as a result of WLRK's role as special counsel.  

The Debtors will compensate WLRK on an hourly basis at its
customary hourly rates for services rendered.  The primary
attorneys who will be handling the above matters and current
standard hourly rates are:

          (a) Richard D. Feintuch       $625 per hour
          (b) Andrew R. Brownstein      $575 per hour
          (c) David R. Caro             $150 per hour

The Debtors stress that WLRK will serve in a limited role as a
strategic advisor to senior management and the Board of Directors
with respect to the specific matters described.  Accordingly,
while the number of hours expenses by WLRK is expected to be
quite small as compared to the Debtors' general bankruptcy
counsel, a large proportion of those hours will necessarily
require the services of experienced senior partners such as
Messrs. Feintuch and Brownstein.  (Harnischfeger Bankruptcy News
Issue 8; Bankruptcy Creditors' Services Inc.)

HECHINGER: Builders Square Employees Seek Class Proof of Claim
Former employees of Builders Square Retail Stores have filed a
motion for approval of class proof of claim and for class
certification.   The employees request allowance and immediate
payment of administrative expense claims.  Approximately 200
claimants seek awards for compensation, severance benefits,
medical and other employment benefits, "BHQ" time, vacation time
and other benefits.

HECHINGER: Order Authorizes Retention of PWC For Committee
The US Bankruptcy Court for the District of Delaware entered an
order on July 29, 1999 authorizing the Official Committee of
Unsecured Creditors of the debtor, Hechinger Investment Company
of Delaware, Inc. et al. to retain PricewaterhouseCoopers as
accountants and financial advisers effective as of June 24, 1999.

IRIDIUM: Defaults on Loans  
Iridium World Communications LLC said yesterday that it defaulted
on loans totaling more than $1.5 billion, putting the global
satellite telecommunications network operator closer to
bankruptcy, Reuters reported. The defaults on an $800 million
loan and another $750 million loan occurred after Iridium failed
to meet revenue growth targets required under its $800 million
loan. The third extension on that loan expired yesterday,
triggering the subsequent default on the other loan. The default
could hurt Motorola Inc., which holds about 18 percent of the
company's equity. Motorola is the guarantor of the $750 million
loan in default. Iridium, still considering its restructuring
options, faces an Aug. 15 deadline for a $90 million in interest
payment on its $1.45 billion in bonds; the company received an
extension from July 15. (ABI 12-Aug-99)

LA POSADA: Historic Hotel Files Chapter 11
The owners of the historic La Posada hotel have filed for
protection from creditors to stop a foreclosure action against
the 60-year-old structure, which was one of Conrad Hilton's first

La Posada had been in escrow since March pending the sale or
refinancing of the property by its owners, La Posada Investors
Ltd., the group's president, Daniel Zerfas, said earlier this
year.  The deal eventually fell through.

In late June, a court ordered the property into receivership
after the owners failed to make several payments to a lender,
Allied Capital.

The court authorized the Hotel Group of Seattle to take over the
hotel's operations temporarily.

Albuquerque attorney Louis Puccini filed the Chapter 11 request
in bankruptcy court on behalf of the owners on Aug. 2 to prevent
a foreclosure expected Aug. 3.

Zerfas in the past attributed the hotel's financial problems to
the property's refurbishing to its former glory, along with a
drop in convention bookings and a weak hotel market in
Albuquerque.  Court documents show the Hotel Group of Seattle
will continue to operate the hotel.

MCA FINANCIAL: Fourth Amendment To Financing
Pursuant to a fourth amendment to final financing order to allow
additional postpetition financing and use of cash collateral, the
US Bankruptcy Court for the Eastern District of Michigan,
Southern Division, entered an order providing an increase in the
maximum amount of loans from $5,075,000 to $6,105,000.  The
debtors are authorized to use an additional $550,000 of the cash

MCGINNIS PARTNERS: Continued Hearing and Disclosure Statement
The court has continued the debtors' hearing on the proposed
Disclosure Statement to August 11, 1999 at 2:00 PM in the
courtroom of the Honorable Ronald B. King, US Bankruptcy Judge,
Alamo Plaza, 615 E. Houston Street, San Antonio, Texas.

NEXTWAVE: Nextel Communications Reached Agreement With DOJ
Nextel Communications, Inc. (Nasdaq: NXTL) announced that it had
reached agreement with the United States Department of Justice
and the Federal Communications Commission, and received their
endorsement of Nextel's contemplated plan to obtain the spectrum
that currently is entangled in the NextWave Personal
Communications, Inc., voluntary bankruptcy proceedings.

Nextel views the pursuit of a resolution of the NextWave
bankruptcy proceedings, which will provide Nextel with additional
spectrum, as a positive step for all stakeholders and a
particularly attractive opportunity for Nextel to apply its
substantial experience in constructing and operating
nationwide wireless network services.  Nextel is uniquely
positioned to facilitate a reorganization of the NextWave
debtors.  Such a reorganization will provide assured value to the
FCC, the creditor constituencies and other stakeholders, which
could be far superior to the continued delay and uncertainty
associated with the ongoing adversarial proceedings in the
bankruptcy and appellate courts.  Nextel considers such a
reorganization of the NextWave debtors to be in the public
interest.  Additionally, Nextel intends to work with
other interested parties to structure a workable plan and attain
a satisfactory and speedy resolution of NextWave bankruptcy

Nextel believes that its existing spectrum position is ample to
meet the needs of its current business plan.  Access to the
NextWave spectrum would allow Nextel greater flexibility in the
pursuit of new strategic initiatives and in the deployment of
future generations of wireless and telecommunications services.

The spectrum at issue covers areas of the United States where
approximately 165 million people live, and consists of so-called
"C-Block" licenses covering 63 Basic Trading Areas (BTAs), as
well as "D, E, and F Block" licenses covering 32 BTAs.  Most of
the licensed markets were not constructed by NextWave prior to
the commencement of the bankruptcy proceedings, and this spectrum
has been largely unutilized in the two and one- half years since
it was awarded to NextWave.

NextWave sought protection by commencing a voluntary bankruptcy
proceeding under Chapter 11 in June 1998, after failing to make
required payments to the FCC for the personal communications
services licenses that NextWave had been awarded in the spectrum
auction proceedings conducted in 1996. The bankruptcy proceedings
currently are pending in the United States Bankruptcy Court for
the Southern District of New York.

Nextel already has been in contact with appropriate
representatives of the creditor and equity groups of NextWave to
explore Nextel's potential role as the sponsor of a consensual
reorganization of the NextWave Debtors. Nextel has not yet
reached agreement with the parties and cannot predict whether
or when it will do so.  Any such plan of reorganization that may
ultimately be reached would remain subject to conditions to its
successful implementation, including the normal bankruptcy court
plan consideration and confirmation process and the receipt of
necessary regulatory approvals.  Nextel Communications, based in
Reston, Virginia, is the leading provider of fully integrated
wireless communications services and has built the largest
guaranteed all-digital wireless network covering thousands of
communities across the United States.  The Nextel National
Network currently serves approximately 3.6 million business
subscribers offering a communications tool with digital cellular
service including an innovative speakerphone feature,
text and numeric messaging services and Nextel Direct Connect(SM)
-- an instant digital two-way radio feature.  Nextel and Nextel
Partners, Inc., currently serve 92 of the top 100 U.S. markets.  
Nextel International has wireless operations and investments in
Canada, Mexico, Argentina, the Philippines, Peru, Japan and
Shanghai, China.  Please visit Nextel's Web site at

PHP HEALTHCARE: Seeks To Sell Assets Of Health Cost Consultants
The debtor, PHP Healthcare Corporation, seeks authorization to
purchase certain assets of Health Cost Consultants, Inc. and
simultaneously sell the same assets to EMEDX, Inc. for a purchase
price of $2.7 million.

The debtor's extensive marketing efforts have failed to turn up a
buyer interested in purchasing the stock of HCC.  Therefore, the
debtor asserts that its only realistic chance to recover any
significant value for HCC is pursuant to the proposed two-step
transaction.  After consummation of the transaction, the debtor
will be able to quickly and efficiently liquidate its ownership
interest in HCC.  The cash realized as a result of such a
liquidation would be used to pay the debtor's creditors pursuant
to its liquidating plan of reorganization.

PLUMA INC: Court Authorizes Sale of Assets of Stardust Division
The US Bankruptcy Court for the Middle District of North
Carolina, Greensboro Division, entered an order authorizing the
sale of the assets of the debtor, Pluma, Inc. utilized in
connection with the operation of the Stardust Division to TAM
Acquisition Corp.

RINCON ISLAND: California State Lands Commission Clarifies Law
The State of California ex rel. State Lands Commission filed a
response to inform the court and the parties of the California
statutory requirements that are imposed upon any transfer of
state oil and gas leases, and to seek clarification concerning
certain aspects of the financing transaction.  The Commission
reserves the right, power and discretion to approve or disapprove
of any assignment or transfer of an interest in the leases.  The
debtor is seeking court authority to a post-petition financing
plan that would grant John Tennant a first lien on a state oil
and gas lease.  The lien may grant Tennant the right or power to
effect a future transfer or conveyance.  The Commission must
insure that the lessees have the operating experience and
financial resources necessary both to fulfill all of the
obligations under the leases, and to conduct operations in an
environmentally sound manner.

In addition, the Commission states that there are several aspects
of the post-petition financing agreement which are unclear.  It
is not apparent what percentage of the outstanding shares of
stock are represented by the two million warrants that John
Tennant is to receive.

The Press Enterprise Co. reports on August 8, 1999 that
About 230 Santa Barbara Aerospace employees were laid off after
their company abruptly filed for Chapter 11 bankruptcy.

The jet maintenance company filed an emergency petition in U.S.
Bankruptcy Court in Riverside on Friday. Employees at the
facility on the former Norton Air Force Base were told at the end
of their shift Friday that the company would be closed in order
to reorganize.

Santa Barbara Aerospace operated in four hangers and 500,000
square feet of space at the former Norton Air Force Base.  The
company neglected to pay rent for nearly a year, said Jim Monger,
airport manager.  He said the rent was about $ 43,000 a month.

He said the Santa Barbara International Airport Authority had
been patient with Santa Barbara Aerospace but had recently
decided to file an unlawful detainer against the company to force
Santa Barbara Aerospace to either pay up or leave.

SERVICE MERCHANDISE: Statement of Operations For May
Net Sales                                             157,206,000
Cost of merchandise sold and buying
   and occupancy expense                              124,575,000
   Gross Margin                                        32,631,000

Selling, General and Administrative Expenses
Net Employment Expense                              23,468,000
Net Advertising                                      4,103,000
Banking and other fees                               1,754,000
Real Estate and Other Taxes                          1,870,000
Supplies                                             1,071,000
Communication and Equipment                            773,000
Travel                                                 385,000
Security and Other Services                            251,000
Legal and Professional                                 853,000
Insurance                                              826,000
Miscellaneous                                        2,442,000
Credit Card Services                                   967,000
Total SG&A                                       38,763,000

Other income, net                                           4,000
Restructuring charge                                            0
Depreciation and amortization                           3,366,000
EBITR                                               (9,502,000)

Interest expense -- debt                                3,341,000
Interest expense -- capitalized leases                    363,000
EBTR                                               (13,206,000)

Reorganization Items:
1997 Restructure 502(b)(6) Reversal                          0
Legal and Professional                               1,854,000
EBT                                                (15,060,000)

Income tax                                                    0
Net Earnings                                      (15,060,000)

SMITH CORONA: Reports Net Income of $.6 Million In Fourth Quarter
Smith Corona Corp. (Nasdaq:SCCO) announced its financial results
for the fourth quarter and fiscal year ended June 30,1999.

For the fourth quarter, the company reported net income of $ 0.6
million, or $ 0.15 earnings per diluted share, on sales of $ 7.9
million, compared with a loss of $ 4.4 million, or $ 1.51 per
share, on sales of $ 12.0 million for the same period last year.

The fourth-quarter results reflect an approximately 50 percent
reduction in selling, general and administrative expenses, as
well as gains of $ 0.3 million from the sale of the former
headquarters facility and tax benefits of $ 2.6 million from the
final liquidation of one of the company's international

Gross margins for the period were 15.6 percent of sales compared
with 8.4 percent for the same period last year.

"We are extremely pleased with our fourth-quarter results, which
are indicative of the many improvements that have taken place at
Smith Corona this year," stated John A. Bermingham, president and
chief executive officer of Smith Corona.

"As expected, the fourth quarter shows the benefits of the
company's year-long restructuring program and return to our core
business. This has been an extraordinary year of change for Smith
Corona with the successful rebuilding of the management and sales
teams and relocation of the company's headquarters to facilities
suited to a sales and marketing organization.

"The expansion of our distribution capabilities resulted in the
renewal of important customer relationships that are bringing new
sales opportunities to Smith Corona. Chief among these is our
recently announced agreement with Office Depot Inc., which
represents our first licensing agreement for office products. The
agreement will bring increased market exposure of the Smith
Corona name and new product sales that will add royalty dollars
direct to the bottom line in calendar year 2000."

Bermingham affirmed that the licensing agreement presents no
conflict with the company's business strategy to introduce new
products that support the company's legacy in printed document
and data transmission.

He announced that the company is in the process of introducing a
new product line in inkjet replacement cartridges called Inkjet
Solutions, which feature a proprietary Snap 'n Fill(TM) cap and
provide branded products at highly competitive prices.

This fall, Smith Corona will also expand its line of headsets to
include a new commercial product line. The new TelEsprit(TM)
headsets and amplifiers feature lightweight, comfort construction
and provide high margin potential with minimal marketing expense.

For the fiscal year ended June 30, 1999, Smith Corona reported a
net loss of $ 15.9 million, or $ 5.27 per share, on sales of $
43.7 million, compared with a loss of $ 6.6 million, or $ 2.36
per share, on sales of $ 58.9 million for the same period last

Results this year included nonrecurring restructuring expense of
$ 1.3 million, while last year's results included gains of $ 3.9
million from the sale of manufacturing operations and $ 1.2
million from favorable claims resolution.  Sales declines in
typewriters and related supplies were partially offset by
newly sourced product sales of $ 6.0 million for the year,
compared with new-product sales of $ 3.8 million last year.

SUN HEALTHCARE: To Remain Open Even In Bankruptcy
Sun Healthcare executives are assuring state regulators that the
company's nursing homes would remain open and patients would be
protected if Sun files for bankruptcy.

"It's very important for us to make sure that they know that if,
in fact, we do make that decision, that patient care will not be
affected," spokeswoman Karen Gilliland said. "We're certainly
going to make sure that the residents will be cared for, and it
will be business as usual."

Albuquerque-based Sun is one of the nation's largest nursing-home
chains, housing about 40,000 people. It operates eight homes in
New Mexico. The company has reported losses close to $ 867
million for 1998 and the first quarter of this year. It has cut
more than 10,000 jobs and has missed making debt payments.

The company said in June that bankruptcy is one of several

If the company were to declare bankruptcy, Sun executives said
the firm would have sufficient funds to continue operating its
nursing homes and maintain current levels of staffing and care,
Mulloy said.

Sun had more than $3 billion in revenues last year. Through job
cuts and other measures, the company is trying to cut annual
operating costs by $400 million.

It blames its financial troubles on reductions in Medicare
payments for nursing home care, although some other major nursing
home companies have withstood the cuts better. The federal
Medicare and Medicaid programs provide most of Sun's funding.

Sun's stock closed Tuesday at 38 cents a share, according to its
Web site. The stock hit $ 20 a share in February 1998 before it
plunged and was removed from the New York Stock Exchange.

Sun also faces several lawsuits alleging deficient care in its

Inspections in several states found nearly 39 percent of Sun's
321 homes caused actual harm to residents or put them in
immediate danger of serious injury or death, according to the
U.S. Health Care Financing Administration.

TRANSTEXAS GAS: Bondholders Object To Termination of Exclusivity
The Bondholder Lenders and the Bondholders Committee object to
the motion of the unsecured creditors of TransTexas Gas
Corporation et al. to terminate the exclusive periods granted to
the debtors.

The Bondholders and Bondholder Lenders state that the Committee's
displeasure with the terms of the debtors' plans does not
constitute cause for termination of the debtors' exclusivity.
They submit that the Creditors' allegation that the debtor have
ceded their exclusive rights to the Bondholder lenders is
"patently absurd."

Each of the debtors was required to file a plan of reorganization
in its respective Chapter 11 case in form and substance
satisfactory to the Administrative Agent and the Bondholder
Lenders as a condition to further funding under the DIP Credit
Agreement.  While the Bondholders had ample opportunity to
comment on and negotiate the terms of the plans, they assert that
they in no way "dictated" the terms of the plans.

UNITED COMPANIES: Objections to Arthur Andersen For Equity
The Official Committee of Equity Security Holders is seeking to
employ Arthur Andersen LLP as accountants and business and
financial advisors to the Equity Committee.

Objections to the application were filed, and a hearing will take
place on August 18, 1999 at 2:00 PM.

XENO TECHNIX: Notice of Conversion To Chapter 7 Case
A bankruptcy case concerning XenoTechnix, Inc. was originally
filed under Chapter 11 on June 3, 1999 and was converted to a
case under Chapter 7 on July 13, 1999.  Attorney for the debtor
is Mark S. Haltzman, One Belmont Avenue, Suite 300, Bala Cynwyd,
PA.  A meeting of creditors is set for September 3, 1999 at 2:30

XENO TECHNIX: Order Approves Employment of Accountant
By order of the US Bankruptcy Court for th e Eastern District of
Pennsylvania, the Trustee is authorized to employ Miller Coffey
Tate LLP, accountants under a general retainer.

Z. FREDERICK ENTERPRISES: Committee Seeks To Convert Cases
The Official Committee of Unsecured Creditors of Z. Frederick
Enterprises Ltd. and Kenar Enterprises, Ltd., debtors, seeks to
convert the debtors' chapter 11 cases to chapter 7.

The Committee asserts that the debtors have no reasonable
likelihood of proposing or effectuating a viable plan.
The Committee states that the estates are suffering continuing
losses.  Additionally, the continuous increase in the amount
borrowed under the debtors' post-petition DIP financing facility
diminishes the potential recovery to unsecured creditors. The
Committee submits that the debtors have no funds or assets
available to them to fund a Chapter 11 plan.  It therefore
follows that the debtors cannot effectuate a plan.

BOND PRICING: For Week of August 9, 1999
DLS Capital Partners, Inc., bond pricing for week of August 9,

Following are indicated prices for selected issues:

Acme Metal 10 7/8 '07                            17 - 20 (f)
Amer Pad & Paper 13 '05                          59 - 61
Asia Pulp & Paper 11 3/4 '05                     68 - 70
E & S Holdings 10 3/8 '06                        51 - 53
Geneva Steel 11 1/4 '01                          19 - 21 (f)
Globalstar 11 1/4 '04                            66 - 68
Hechinger 9.45 '12                               14 - 17 (f)
Iridium 14 '05                                   23 - 25 (f)
Jitney Jungle 10 3/8 '07                         35 - 37
Just for Feet 11 '09                             34 - 37
Loewen 7.20 '03                                  65 - 66 (f)
Planet Hollywood 12 '05                          20 - 22 (f)
Purina Mills 9 '10                               31 - 36
Samsonite 10 3/4 '08                             83 - 85
Service Merchandise 9 '04                        20 - 21 (f)
Sterling Chemical 11 3/4 '06                     68 - 72
Sun Healthcare 9 1/2 '07                         11 - 13 (f)
Sunbeam 0 '18                                    16 - 17
TWA 11 3/8 '06                                   63 - 65
Vencor 9 7/8 '05                                 24 - 27 (f)
Zenith 6 1/4 '11                                 20 - 23 (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 in each Friday edition of the TCR, is provided byDLS
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, Yvonne L. Metzler and
Lexy Mueller, Editors.  Copyright 1999. All rights reserved.
ISSN 1520-9474.

This material is copyrighted and any commercial use, resale
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Information contained herein is obtained from sources believed
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